Purposeful Disruption Four Strategic Priorities in Focus

1. Purposeful DisruptionFour Strategic Priorities in Focus May 16, 2019

2. Verily (a Google company) patented a smart syringe that can be used to track medication adherence for diabetics. #SmarterShots

3. Verily (a Google company) patented a smart syringe that can be used to track medication adherence for diabetics. TRUE #SmarterShots

4. “Hey Alexa! What do you think this rash is?” Amazon is combining natural language with AI to diagnose acute medical conditions and recommend a course of treatment. #AlexaKnowsTooMuch

5. “Hey Alexa! What do you think this rash is?” Amazon is combining natural language with AI to diagnose acute medical conditions and recommend a course of treatment. FALSE (for now) #AlexaKnowsTooMuch

6. There is a wearable that detects stress levels in your brain, and automatically turns down your stress response using vibrations. #Ommmmmmmmmm

7. There is a wearable that detects stress levels in your brain, and automatically turns down your stress response using vibrations. TRUE #Ommmmmmmmmm

8. “The pace of change has never been this fast. And yet, it will never be this slow again in the future”.

9. 23.1bn (2018)

11. So what does that mean to us? Cycle time to reach 50 Million Users Source: visual capitalist via statista

12. Change in the healthcare market continues to outpace itself.An overwhelming focus on the consumer Unique consumer data points Consumer loyalty Distribution channels people actually want to use An ever-expanding cast of tech giants entering the healthcare scene… …and the evolving sophistication of digital options that started as direct-to-consumer offerings. New business models with an unprecedented level of real consumer-centricity

13. Employer Framework for ChangeDriving positive change without cost shifting Driving members to High quality care using data technology + user insights Embracing positive disruption in the healthcare ecosystem Paying for care based on quality and outcomes,not volume Personalizingbenefit experiences

14. Employers are making progress in transforming healthcare… Employer-Driven Healthcare TransformationVitals for change insights 37% 85% 35% 66% have pushed their health plan partners to evaluate current approaches and share results impact “social determinants of health” by offering telehealth are creating business case for change with internal leaders, socializing the business imperative for change • give their members access to information about provider quality …yet opportunity remains Vitals for Change Scorecard 2019 Benchmark Report; Mercer and Catalyst for Payment Reform, n = 89 14

15. Employers have the opportunity to do more… Employer-Driven Healthcare TransformationVitals for change insights 89% 32% 75% 18% • feel that the pay-for-value strategies currently in place in the health program are slightly or not effective at all address health literacy and health awareness in culturally relevant and appropriate ways believe there is real potential for change and disruption with genetic technologies (e.g., genetic testing and screening) • had conversations with key healthcare providers about how important quality is to your company …and the shifting healthcare market will continue to demand that employers take action Vitals for Change Scorecard 2019 Benchmark Report; Mercer and Catalyst for Payment Reform, n = 94 15

16. Innovation UpdateOur Annual Agenda Human-Centered Design New Tech and Data Frontiers Brave new world Redefining Consumerism (v4.0) Personalizing the experience through bundles Hidden figures and new data

17. Consumerism 4.0

18. ConsumerismWhere we’ve been – This is not a new term At first, “consumerism” was synonymous with Consumer Driven Health Plans. CDHP Prevalence CDHP full replacement Appears to be leveling off Avg. medical plan cost per employee, among large employers Widely accepted that consumer-driven plans cost less on the surface CDHP Perception 5k+ EEs 20k+ EEs Have already moved to strategy for majority of employees Likely /very likely Unlikely /very unlikely HMO PPO PPO w/ $10k+deductible HSA-eligibleCDHP

19. ConsumerismA new reality – Trend over time Healthcare costs continue to outpace inflation in the US 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 20191 Annual change, total health benefit cost per EE:Expected trend before plan changes Annual change, total health benefit cost per EE:After plan changes

20. Consumerism 4.0Where we’re going – Employee benefits, meet HCD “Human Centered Design (HCD) is a mindset and discipline that puts the person, rather than the person’s health condition, at the center.” Fig. 1. CoDesign Graphic. Kaiser Permanente.

21. Consumerism 4.0Where we’re going The most powerful HCD products have these things in common Delight in design Customer-driven Ease in transactions Constant feedback loops Data rich

22. Consumerism 4.0Human Centered Design – Now what?

23. Consumerism 4.0Human Centered Design – Now what? Partner Promote Learn & apply • While the notion of Amazon Prime Health is a rumor, are there unconventional DTC companies with whom we should pursue new partnerships? • Which offerings in the public domain can we promote? • What areas can we right-size your investments in enterprise programming? • What are the dimensions of successful DTC healthcare offerings that we can isolate and apply to our benefits offerings? • How does this refine vendor procurements, performance guarantees, and metrics to track partner performance?

24. Personalizing the Experience: Bundles

25. Point solutionsWhere we’ve been Data Analytics Perks Emerging Physical Activity/Wellness Medical Devices Pharmacy Financial Sleep Transparency Weight / Nutrition TeleHealth Behavioral Health 2nd Opinion Condition Mgmt. Care Coordination Broad Advocacy Navigation/Aggregation Pregnancy / Family Onsite/ Near-site  Population  Managing Cancer At Work  Population  Incentives  Focus  Assessments/Testing Communications Smoking / Substance Abuse Provider Networks Member Narrow Employer-Sponsored/Exchange Narrow

26. Point solutionsWhere we’ve been – MSK Prevention Return to Work Treatment Early Detection

27. Point solutionsWhere we are today – Challenges Engagement Strategic Programmatic Tactical ? ? ?

28. Custom,curatedMSK bundle Back to Human-Centered DesignWhere we are going – cohesive experience Illustrating the core functions for an end-to-end solution • Best-practice plan design recommendations and incentives • Ability to select from panel of start-ups for preventive health offerings • Integration with carrier offerings and steerage to high quality care • Ability to select from panel of start-ups for early detection offerings Consumer focus Comprehensive strategy Prevention Early detection • Best-practice non-surgical alternative treatment options available through start-ups and supported by custom plan design options • Conservative navigation of care /surgical options • Integrated disability/RTW modelto reduce lost productivity time • Ability to select from panelof start-ups for RTW offerings; integrates into medical and disability Treatment Return-to-work

29. Point solutionsWhere we are going – Key Considerations Strategy Contracting • Who holds the contract? • How do we design agile contracts? • How can we share the relevant data to track outcomes? • How do we protect the data of our employees? • How do we normalize data across entities? • Can we design a pricing structure where everyone wins when the entire bundle is successful? • How can we work with vendors to actively manage risks? Pricing Data

30. Brave New World

31. Brave New WorldWhere we are now – What we’re describing Genetic tests Pharmacogenomics Gene therapy Cancer treatments High-cost biologics Specialty Rx

32. Brave New WorldWhere we are now – The genetic testing explosion Retail side of healthcare industry Food industry – “neutraceuticals” Average net new genetic testing units (GTUs) – per day 2015 2016 2017

33. New Tech and Data FrontiersFrom Treating Illness to Curing Disease What would you do if you had an employee with a high cost treatment? Bob has diabetes. Instead of taking insulin for the rest of his life, which correlates to $$, a new therapy emerges that will treat his diabetes. It costs $$$$$$. You pay for it. One month later, Bob leaves your company. Should you cover it? Your employee, Bob Are there other ways to pay for it? Do you hold Bob accountable if he leaves? Or if he leads an unhealthy lifestyle? What happens if covering this for Bob means you have to reduce plan richness for all? If so, based on what criteria?

34. New Tech and Data FrontiersWhere we’re going Impact Effort Next-gen utilizationmanagement Across timeAcross people Two new ways ofsharing risk Mind thepipeline

35. Hidden Figures

36. Hidden FiguresData is everywhere Approximately 33 Zettabytes of data were created in 2018; saving that information would require: 660 billion Blu-ray discs (50 GB) 375 million pre-teen world wide webs (88 TB) 330 million top-notch hard drives (100 TB) 33 million human brains (1 PB) Source: https://www.statista.com/outlook/digital-markets/digitalEconomyCompass2019.pdf

37. Hidden FiguresThe Data Goes Far Beyond Claims Data Source: Visual Capitalist

38. Hidden FiguresThe data gold rush Carriers/PBMs Providers Vendors (new/old) Data warehouses Consumers

39. Hidden figures A new role for employers 430598436973249882339483209580923840923840923840832094823055484233812348780213858717234320481230958147598347598324842394230948983475923742374923615817236489723159876102347632987469231659827364981272365981263949862348732615981276359812634982136598126348286498213765169126591041632084723015693456000640249126358976142987756129436023642650162562536459826349862135879162385961023460123561248765922469873268740162356263518465981263498213650625652195827567823647321659812650235601263521836508126350872365087623056210873651028375601826530123658217650238650128652635762016387561208375618270524665886068567456345135942356293485792847329859238479386794572039487692834769230847538947692837496729387496732948672039

40. In ClosingTwo (and a half) quotes “Give me six hours to chop down a tree and I will spend the first four sharpening the axe” – Abraham Lincoln “Pitter patter, let’s get at ‘er.” – source unknown, most frequently used by my mother