ACSG Presentation

Creating Value Based Healthcare

Patented Population Management

Presented by:

Jack Hill, Partner

© 2011 Accountable Care Solutions Group, LLC

Your LogoJUNE, 2011

• Key Family of Companies and who we are; Why KBA, AHDI & ACSG?

• Value Based Healthcare for Tomorrow…Turning Data into Intelligence

and the future delivery of integrated healthcare

• ACO Development with Patented Population Management

Contents

1

Key Family of Companies

Key Benefit Administrators - KBA Provides administrative infrastructure for population management

Risk management specialists

Highly integrated administrative infrastructure necessary to support healthcare budget

management

American Health Data Institute - AHDI A data warehouse and targeted utilization management partner that combines all the

necessary elements for controlling healthcare costs from both the demand and supply

side of the healthcare equation

A Premier Partner of TriZetto – The largest claims software vendor in the U.S.

TriZetto represents 353 Payers (62% of all BCBS Organizations), 173 Million Lives

Under Contract (36% of Managed Medicare), and 144 Million Lives in Production

(Processing 38% of Managed Medicaid)

Accountable Care Solutions Group, LLC - ACSG A distribution and consulting firm for managed care strategies and development,

uninsured mitigation programs, and the Patented Population Management processes

applicable to any payer segment2

• Size and Stability – The Key Family was founded in 1979 as a full-service group benefits

administration firm specializing in self-funded medical plans. Since that time, the Key Family has

grown to become one of the country’s largest independently owned third party administrators,

supporting a wide variety of group benefit plans. With its two major locations in Indianapolis,

Indiana, and Fort Mill, South Carolina, the Key Family is a commonly held group of benefits-related

organizations with over 400 employees, over 3,000 corporate customers, and over 500,000

members under management.

• Integrated Systems - All of our systems, nurse coaches, case management and disease

management are all connected. This allows our systems, in combination with AHDI, to deliver

meaningful information so that our clients can make critical decisions relative to their integrated

system or healthcare plan.

• Reporting – AHDI utilizes the payers’ medical and Rx claims data to develop standard reports. In

combination with these statistics, an expansive industry data set, and sophisticated analytical tools,

AHDI performs multiple analysis necessary to evaluate costs, quality and efficiency. Ordinary

claims data is transformed into powerful, actionable intelligence.

• Resources - As part of our package, you will have access to a Medical Director and ERISA

Attorney to assist you with plan design, HIPAA compliance, COBRA issues and Healthcare Reform.

• Planning - It is not just about what happens during an “ACO readiness assessment” or the

inaugural launch of an integrated healthcare solution; it’s truly about supporting the demands of

your local payer community and ensuring that value is delivered.

Key Family of Companies

3

AHDI: Calculation of Value Based Healthcare

• Effectively control healthcare costs while improving health quality, the

following data must be analyzed:

– Population health statistics

– Provider data: quality, cost and compliance

• To ensure standardization, implement the application of the same

statistical measures across all payers

• The American Health Data Institute (AHDI) has been measuring

population health and provider data in order to provide actionable

intelligence to payers

• AHDI has been the central technology engine among a variety of payers

in any given geography

4

• Provider practice and cost deviations– Practice patterns which result in low total costs for the types of illnesses comparable to other

physicians of the same specialty (cost efficiency index)

– Delivery of high levels of post-primary preventive care services for chronically ill patients

– Patterns of clinical and billing practices that avoid service up-coding, services that are not

appropriate for the diagnosis, invalid diagnostic coding and services performed more frequently

than typically appropriate.

• It has been statistically validated that Endorsed Providers are on average 40% less expensive than providers who do not pass the three, clinically based tests

• There are on average 15% Non-Endorsed Providers in areas where there are enough episodes to statistically measure

• It has been actuarially validated that Non-Endorsed Providers on average will add 10% excess cost to an employers health plan costs

AHDI: Provider Practice & Cost Deviation

6 5

• AHDI’s Chronic Disease Management Program has documented the

following results:

– Multiple payers in two different large geographic areas of the country saved

between 6.4% and 7.3% of medical claims cost each year by using the AHDI

model for managing chronic conditions

– After 5 years these multiple payers

saved between 11-17% of medical

claims cost by using the AHDI model

for managing chronic conditions

AHDI: Results

7 6

AHDI: ResultsSelf Funded Employer Groups – Case Studies for 200-1,000 Employee Lives

8

$-

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

2005 2006 2007 2008 2009 2010

Tota

l Me

dic

al C

ost

s

Company 2 Trend

$-

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

2005 2006 2007 2008 2009 2010

Tota

l Me

dic

al C

ost

s

Company 1 Trend

32%

Savings17%

Savings

Company 1 Textile Manufacturer - Healthcare Index 1.22 Company 2 Trucking Company - Healthcare Index 1.21

$1,600,000

$2,600,000

$3,600,000

$4,600,000

$5,600,000

$6,600,000

$7,600,000

2008 2009 2009

Tota

l Me

dic

al C

ost

s

Company 3 Trend

12%

Savings

Company 3 City Government - Healthcare Index 1.25

7

The Role of ACSG within an Integrated

Healthcare Management System

Structural

Organization

Phys

Hosp/etc

Data

Warehousing

Medical

Referral

Control

Employer

Stop Loss

Data Drill

Down

Capabilities

Gain

Sharing

Formulas

Small

Employer

Financial

Targets

Recognition

of High Cost

Patients

Geographic

Benchmarks

Gain Sharing

Distribution

Methodologies

Episodic

AnalysisPredictive

Modeling

Clinically

Integrated NetworkDelivery of Quality Healthcare

Controlled Healthcare Costs

Healthier Members

=

Step Down

UM

Management

Ongoing

Educational

Resources

Employee

Healthcare

Indexing

Employer

Benefit

Consulting

Hospital/

Physician

Discounts

Physician

Profiling

Employer

Healthcare

Indexing

ACO

Medical

Director

Chronic

Disease

Management

Treatment

Criteria

Compliance

Member

Incentive

Program

Personal

Health

Records

Wellness

Programs

On-site

Testing

Professional

Telephonic

Nurse Coaching

Health

Risk

Assessments

* *

*

* * *

* *

* *

*

*

The services work together to provide an end result where the whole is greater

than the sum of its parts.

*Items incorporated in United States Patent #7,711,577

8

What Could ACSG Bring to Your Community?

Clinically Integrated Network

CMS Employer 1

TPA 2

Employer 2

Blue Cross & Blue Shield Plan

Gain Sharing

Employer DistributionACO Distribution – Hospitals &

Physicians

Data Extract to AHDIIndividual & Aggregate Employer

Reporting PackageACO Reporting

9

The Role of Your ACO with our Patented

Integrated Healthcare Management System

A proven system of

population management that

can assist medical providers

in their management of new

payment reforms under

Medicare, Medicaid,

commercial health plan risk

contracts, and proprietary

employer health plan

management.

10

Population Management Patent – So What?

• Patent awarded in 2010.

• Identifies patients from a covered population likely to

generate expensive healthcare, determines whether

they have received healthcare services, sets up a

regimen of care, identifies qualified providers with best

practices, and prompts patients to obtain needed care.

• Broadly defined definitions on processes that

encompass most managed care delivery systems (e.g.,

PHOs, HMOs, IPAs, etc.), including ACOs.

• Health Economic Zones can be states, zip codes,

counties, cities, etc.

• US Patent Office did not uncover any “Prior Art”

concerning processes being used by any other

organization.

• Patented processes have been utilized with

quantifiable results.

11

What is ACSG’s Value? So What?

Support of ACO Infrastructure

• ACSG through ADHI can support all key elements, such as data warehouse and data

sources, the use of disease registries to provide physicians and their care teams with

meaningful information inclusive of reports for tracking financial and clinical performance.

• Through nurse navigator coaching and beneficiary compliance with minimum levels of

care;

– Interventions can quickly generate savings and ROI

– Support of long-term interventions aimed at better managing chronic disease

• Can support One-sided & Two-sided Models through financial reporting and management.

– Can measure all the claims-based clinical quality measures under CMS/ACO regulations

– Risk Management model with access to “integrated” reinsurance for Two-sided models.

• Can support bundled payments, partial and full capitation models.

• Can support eligibility management for various attribution and commercial membership

models.

• Can assist in establishing three-year cost and utilization reporting in addition to trend

analysis.

– Cost and utilization trend reports, mix of services analysis, provider reimbursement analysis,

utilization management analysis, and disease management and other medical intervention analysis

12

What is ACSG’s Value? So What?

Support of ACO Infrastructure

• Operational services:

– Access to data to identify and attribute beneficiaries;

– Use of our contract rates with ACO participating provider;

– Use of our contract rates with providers “outside” the ACO;

– Claims adjudication;

– Data analysis services performed by our actuarial and analytical staff;

– Use of our utilization management services such as nurse navigators, nurse help-line and contracts

with PBMs; and

– Calculation of bonus amounts according to agreed-upon formulas.

• Can supply ACO with deployment of a proprietary employer based program(s) for

population management:

– Utilizing our proven results;

– Utilizing our patented processes;

– Utilizing our gain sharing methodologies;

– For small and large employers; and

– Establishing ACO’s benchmarks for future CMS Medicare launch.

13

Jack Hill

Executive Vice President & Partner

Phone: 630.878.7539

Email: [email protected]