1

Bellin HealthLessons from a Successful Medicare Pioneer ACO

March 31, 2016

2

Table of Contents

I. We Are Doing Some Good Things – Rating Agency Actions

II. Who We Are – Bellin Health’s Platform

Organizational Structure

Market and Scorecard Measures

II. Lessons From A Top Performing Medicare Pioneer ACO

2

3

Strategic Initiatives

We Are Doing Some Good Things –Bellin Health’s Ratings Actions

Continued Very Strong Financial Performance• Operating performance measures continue to strengthen in 2014

• Results are ahead of budget for first fiscal quarter of fiscal 2015.

• Liquidity has also improved due to positive performance and capital structure and debt service ratios are

very strong.

4

3

5

Bellin Started at BBB+6/04

Bellin Upgraded 

to A‐6/06

Bellin Upgraded 

to A10/10

Bellin Affirmed A

4/14

Bellin Upgraded to A+3/15

Data as of Dec. 31, 2014.

© Standard & Poor’s 2015.

6

Initial Rating Assigned

BBB+ Stable 9/01

RatingAffirmed

8/05

BellinUpgraded

to A34/06

RatingAffirmed

11/03

RatingAffirmed

10/08

OutlookRevisedto A3

Positive6/10

BellinUpgraded

to A212/11

Affirmed

A2Rating3/13

Affirmed

A2Rating6/14

Affirmed

A2Rating3/15

Source: Moody’s

4

7

Strategic Initiatives

Who We Are –Bellin Health’s Platform

8

5

Our Corporate Structure

9

Bellin Health Systems, Inc.501(c)(3)

Lake Michigan Health Care Services, Inc.

501(c)(3)

Bel-Regional Home Medical, Inc..

Taxable

D1 Sports Training of Green Bay, LLC

Taxable

Bellin College, Inc.

501(c)(3)

Bellin Foundation, Inc.

501(c)(3)

Bellin Psychiatric Center, Inc.

501(c)(3)

Bellin Memorial Hospital, Inc.

501(c)(3)

Oconto Hospital and Medical Center, Inc.

501(c)(3)

Bellin-ThedaCare Healthcare Partners,

Inc. Taxable

Unity Limited Partnership

501(c)(3)

Bellin Orthopedic Surgery Center, LLC

Taxable

NorthReach Healthcare, LLC

501(c)(3)

Bellin Health Partners, Ltd.

Taxable

AboutHealth, LLC

Taxable

Obligated Group Member

Who We Are

10

Bellin Health provides quality healthcare to the residents of a 12-county area covering northeastern Wisconsin and the Upper Peninsula of Michigan. Strong and long-standing relationships with physicians

73% of our revenue is derived from outpatient services

BELLIN MEMORIAL HOSPITAL 71-bed acute care multi-specialty hospital; known as

the region’s heart center, it was the first hospital in the area to offer a comprehensive heart program

BELLIN HEALTH OCONTO HOSPITAL 10-bed critical access hospital

BELLIN PSYCHIATRIC CENTER 65-bed freestanding hospital; the Center’s team of

professionals treats children, adolescents, and adults with emotional and/or addictive disorders

BELLIN MEDICAL GROUP Employs 151 physicians in 38 locations Continued increases in visits

NORTHREACH HEALTHCARE 14 physicians and 14 midlevel providers

BELLIN HEALTH FOUNDATION $5.2 million in assets as of September 30, 2015 for

the benefit of the organization

BELLIN COLLEGE Offers a four-year degree for students pursuing a Bachelor of

Science in Nursing, Master of Science in Nursing, and a Bachelor of Science in Radiologic Technology

Medical College of Wisconsin now on Bellin College Campus

ABOUTHEALTH Statewide network involving six other healthcare organizations:

Aspirus, Aurora Health Care, Gundersen Health System, Marshfield Clinic, ProHealth Care, ThedaCare, and University of Wisconsin Hospital & Clinics developed to build upon and advance the clinical quality, efficiency, and customer appreciation

BELLIN-THEDACARE HEALTHCARE PARTNERS Pioneer Accountable Care Organization (“ACO”) Model

comprised of the Hospital, ThedaCare, and approximately 700 independent and employed physicians, providing services throughout Northeastern Wisconsin and the Upper Peninsula of Michigan

BELLIN HEALTH PARTNERS Locally, clinically integrated network Participating in Next Generation Medical ACO

6

Our Scorecards Follow and Measure Our Strategies

• Bellin has a System Scorecard that is

driven by individual Brand Scorecards to

define and measure progress toward

achieving our Strategies.

• Focus of measures involves primary care

growth, physician and staff engagement,

improving the health of the population,

including clinical quality which impacts

financial performance and financial

measures.

• The System Scorecard drills down to the

department level to show clear

accountability.

11

12

Utilization Data

7

13

Strategic Initiatives

Lessons from a Top Performing Medicare ACO in the Country

14

SYSTEM RESOURCES

• 715 Physicians

• 57 Primary Care Locations

• 3 Tertiary Hospitals

• 4 Critical Access Hospitals

• 1 Psychiatric Hospital with full-service Behavioral Health Clinic

• Hospice & Palliative Care Services

• Skilled Nursing Facilities (1 system-owned)

POPULATION SEGMENTS

• Employees, Children & Families 540,000 people

• Medicare160,000 people

• Medicaid 180,000 people

• Uninsured 120,000 people

• Total Population 1,000,000 people

Bellin-ThedaCare Healthcare Partners

8

15

Bellin Health-ThedaCare Relationship Characteristics

• Contiguous markets with similar demographics and economic base

• Early adopters of process improvement theory

• Similar governance

• Common competitors

• Operated a joint venture, provider-based health plan for 10 years (1995-2005)

• Share an enterprise-wide medical record based on Epic software

• In 2006 - established a clinically integrated delivery system, know today as Bellin-ThedaCare Healthcare Partners

BTHP

2 Hospital Systems740 Physicians1.2 Million Population20k Pioneer Pts.

Pioneer

16

9

Pioneer Recap

17

Attribution• 20,000 Medicare fee-for-service beneficiaries• Primarily PCP attribution

Financial Accountability• Medicare Parts A&B (not Part D)• ALL claim files for our population• Baseline expenditure vs. National Baseline expenditure

Quality Accountability• 33 quality metrics• National comparison

Bellin-ThedaCare Pioneer ACO

18

10

Generate savings/lossesCMS

BTHP

Quality Score

The Math Summary

19

4 Domains of QualityPioneer ACO must report on 33 MetricsOverall score determined the % of Shared Saving returned to the ACO

20

Domain Source # indicators

# pts Weighting

Patient/Caregiver Experience

CG-CAHPS 61

122

25%

Care Coordination/Patient Safety

ClaimsEHRreportingEMR

312

644

25%

Preventive Health

EMR 8 16 25%

At Risk Population

EMR 12 14 25%

11

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2

BTHP Pioneer Results 2012

21

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2

BTHP Pioneer Results 2012

National Trend

22

12

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2

BTHP Pioneer Results 2012

National Trend

BTHP

23

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2

Expected Target

BTHP Pioneer Results 2012

National Trend

BTHP

24

13

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2

Expected Target

BTHP Pioneer Results 2012

National Trend

BTHP

25

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2

Expected Target

BTHP Pioneer Results 2012

National Trend

BTHP

Savings: $389 per bene

Savings

26

14

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2

Expected Target

BTHP Pioneer Results 2012

National Trend

BTHP

Savings: $389 per beneQuality: 100% Reported

Savings

27

$7,500

$8,000

$8,500

$9,000

$9,500

$10,000

$10,500

$11,000

$11,500

Baseline Year 1 Year 2 Year 3

Pioneer 2012-2014

National Trend

$10,914 (PY1)

$10,731 (PY1) $10,990 (PY2)

$8,419 (PY1)$8,583 (PY1)

$8,030 (PY1)

$8,451 (PY2)

$8,274 (PY2)

BTHP

20132012

$10,819 (PY3)

$8,355 (PY3)

$8,521 (PY3)

2014

28

15

2012-14 Pioneer Summary Totals

Investment Return

2012 $773,000 $5,136,000

2013 $834,260 $2,268,660

2014 $816,000 $2,180,463

Total $2,421,668 $9,585,123

29

Pioneer’s Average Cost Per Beneficiary

 7,800

 8,800

 9,800

 10,800

 11,800

 12,800

 13,800

 14,800

 15,800

 16,800

2012 2013 2014

Medicare Pioneer ACO'sAverage Annual Expenditure Per Aligned Beneficiary

Allina Health Atrius Health

Banner Health Network Beacon Health

Bellin‐ThedaCare Healthcare Partners Beth Israel Deconess Care Organization

Brown & Toland Physicians Dartmouth‐Hitchcock ACO

Fairview Health Services Franciscan Alliance

Heritage California ACO Michigan Pioneer ACO

Monarch Healthcare Montefiore ACO

Mount Auborn Cambridge Independent Practice Association OSF Healthcare System

Park Nicollet Health Services Partners HealthCare

Steward Healthcare Network Trinity Pioneer ACO

30

16

Pioneer’s Quality Results

68.00%

70.00%

72.00%

74.00%

76.00%

78.00%

80.00%

82.00%

84.00%

86.00%

88.00%

90.00%

92.00%

94.00%

96.00%

2013 2014

Medicare Pioneer ACO's Overall Quality Score

Allina Health Atrius Health

Banner Health Network Beacon Health

Bellin‐ThedaCare Healthcare Partners Beth Israel Deconess Care Organization

Brown & Toland Physicians Dartmouth‐Hitchcock ACO

Fairview Health Services Franciscan Alliance

Heritage California ACO Michigan Pioneer ACO

Monarch Healthcare Montefiore ACO

Mount Auborn Cambridge Independent Practice Association OSF Healthcare System

Park Nicollet Health Services Partners HealthCare

Steward Healthcare Network Trinity Pioneer ACO

31

32

Pioneer Quality Results

17

33

Quality Recognition at National Headlines

34

18

35

Pioneer – Defining Which Projects to Target by Creating a Driver Diagram

36

19

Pioneer – Defining Which Projects to Target by Creating a Driver Diagram (closer look)

37

Defined criteria to subdivide the Pioneer population

• Broke Pioneer population into 4 subsets based on spend and chronic diseases

Purpose

• To identify how the subsets varied from one another

• To identify how to best manage the health and experience for each subset

• To identify the largest areas for opportunity to make improvements for the population

Pioneer – Examining a Subset of the Pioneer Population

38

20

Pioneer Strategy

Strategy#1:PrimaryCareStrategy100% of our Pioneer population

1. Leverage our existing and Primary Care system

2. Medicare Annual Wellness visit

3. Pioneer metrics

4. Patients with chronic conditions are well managed and in control

Strategy#2:SuperUserStrategy3% who spend 30% of the costs

1. Predictive modeling

2. Identify barriers (physical, psychosocial, cultural)

3. Care coordination

39

1) Continuation of trend2) Rigorous systems of improvement3) New initiatives spurred by financial

construct4) Leveraged primary care and common EMR5) Spread Risk6) Hearts and Minds

Pioneer Success Factors

40

21

Lessons Learned

1) Population health – big endeavor

2) Pioneer alone is not enough value-based care

3) Claims based attribution is not accurate enough

4) Financial construct – devils in the details

5) Fee for service is deeply engrained

6) Quality hazards everywhere – metrics, specs,

measurement, reporting

41

Steps to improve

1) Move away from FFS - Total cost of care

2) Cost accounting

3) Attribution – attestation, panels

4) Reward improvement and achievement

5) Better data

6) Standardize quality platform

7) Patient incentives

8) Get out of the way, let the market work

42

22

Manage Populations to Achieve the Triple Aim– Driver Diagram

43

Future Direction

1) >50% revenue in value based contracts

2) Participating in CMMI Next Generation ACO

3) Payment to front line aligned with goals

4) Data to the point of care

5) Redesign of care systems around the patient

6) Shared responsibility – patient, provider,

payer

7) Partnership across community

44