1. Provider Workshop North Carolina Health Insurance Institute
October 26-27, 2017

2. About MedCost

4. A
Who We Are INTEGRATED
Founded in 1983, MedCost is a benefits solutions company based in Winston Salem, NC, serving employers through NC, SC and VA through:
Third party administration for self-funded businesses ranging in size from 50 – 25,000 employees
Care Management programs cited as best in class by national consulting firms
Proprietary network of 75,000+ providers
We remain committed to our contracted providers and welcome the opportunity to collaborate on innovative industry initiatives, while keeping the greater concept of value in mind for our clients and your patients.
MedCost has 30+ years experience developing innovative care management programs and managing an extensive and stable provider network
1983 MedCost formed and PPO Network and Utilization Review programs developed
1996 MedCost acquired by Carolinas HealthCare System and North Carolina Baptist Hospital
1998 MedCost Benefit Services formed as TPA to gain more control over distribution of products and services to better compete with large national carriers
TRANSITION: After 30+ years these are some of the companies who have chosen to work with us.

5. The Evolution and Growth of MedCost Journey to Integrated Benefits Solutions
Providing TPAs and
Insurance carriers with
a PPO Network in NC
and Medical Management
Services
1983
1998
2006
2011
Started TPA to offer employers full-service integrated programs
MedCost ownership change - CHS and WFBH
Acquisition of Health Care Savings (PPO) network
Launched nurse coaching program for at-risk population
Expanded product offerings to include pricing transparency and online health and wellness
Expanded product options to include behavioral health, reference pricing and benefit administration solutions
1990
2003
2014
Expansion of PPO Network to South Carolina
Launched Maternity Management Program
Acquisition of Piedmont Administrators (TPA)
Expanded services to include COBRA administration
Invested in integrated advanced analytics
Deployed telehealth product offering
2009
Acquisition of Medical Claims Management (TPA)
2017
Acquisition of Virginia Health Network (PPO)
MedCost Today
34 years of experience providing solutions to employers
Regional presence in NC, SC and VA
260 employees; headquartered in Winston-Salem, NC
TPA serving 190,000 members
Network serving 350,000 members
Strong provider network in the Carolinas and Virginia with over 75,000 participating providers
Administered $1.5 billion dollars in health care in 2016, balancing cost and care with integrated solutions

6. Population We Serve Health Care Providers Employers Consumers
Programs and services that provide affordable health benefit options
Improve health of employee population
Alternative to insurance companies
Comprehensive benefit plans
Health and wellness programs
Higher level of flexibility, customization, service and affordability
Employer-specific reporting
True partnership
Improving health care through strong consumer engagement programs
Consumer-friendly programs offering broad access and choice
Care management programs to advocate for patients and their families
Transparency tools to empower consumers to make informed health care decisions
Exceptional member services
An alternative that allows providers to diversify their payer mix which promotes competition in the marketplace
Collaborative relationships in achieving affordable health care
Robust data sharing to identify cost trends
Managing benefits for over 40 hospitals and their employees
Strategic partnership on behalf of the community and our membership

7. Our Clients
Headquarters

8. Regional & National Network Solutions
Primary
Network
Ancillary
Network
Multi-State
North and South Carolina (MedCost Network)
Virginia (Virginia Health Network)
Progressive Contracting Strategies
Comprehensive Access
Pricing Transparency
URAC-Accredited in Provider Credentialing
Innovative Network Solutions
Strategic partnership with national network for primary coverage for members residing in other states or traveling
MedCost Network
Largest independent PPO network in the Carolinas
Comprised of more than 11,000 primary care physicians, over 27,000 specialists and more than 1,300 hospitals/facilities/ ancillary providers
MedCost Ultra partnered with Virginia Health Network in VA.
Ancillary (leased) Network
Access to national networks for primary PPO and travel
LSP NOTES:
MBS Direct & Ultra: contracting strategies not available to TPAs leasing the MedCost PPO network.
Competitive Markets: Charlotte, Asheville, Hickory, Winston-Salem, Greenville, NC

9. Benefit Solutions Administrative Services
Consumer
Driven
Health Plans
Claims
Administration
Ancillary
Services
Medical
Prescription
Stop Loss
Dental
Vision
Flex Spending Accounts
COBRA
Compliance
Underwriting
HIPAA
Disability
Benefit Design
Health Reimbursement Accounts
Health Savings Accounts
MedCost comes with 15+ years experience, a flexible, open architecture plan designs, and comprehensive administrative services that exceed industry expectations. We can deliver:
Expertise and guidance on benefits and funding options that fit an employer’s business needs and goals
Administration of an employer’s plan based on their specifications
Seamless interface with a client’s preferred vendors and partners
TRANSITION: We understand the special needs of self-funded clients and offer ancillary services to support those requirements – like customized stop-loss protection and legal expertise to help navigate health care compliance requirements.
LSP NOTES: Seamless interface with a client’s preferred vendors and partners for ancillary products
Evaluating an enrollment platform that would streamline data exchange.

10. MedCost Core Competencies Integrated Health Solutions Experts
Core Administration
& Claims Adjudication
Customer
Service
INTEGRATED
SOLUTIONS
Data
Analytics
Compliance
We believe our value proposition is a fully integrated benefits solution.
Network claims will go to a single location
Health management team will have access to eligibility, benefits, and claim information.
Clinical Care Management
Network
Management

11. A Hybrid that Makes Us Different
The sophistication and integration of a national brand combined with the flexibility, pricing and service of a local business
Solutions Management
Flexible
Network
Customer-Focused
Care
Management
TIP… Use this slide to wrap-up and reconnect to the audience benefits sited at the beginning of the presentation.
LSP NOTES:
We are large enough to offer all the bells and whistles of a carrier but small enough that we do not lose sight of what’s important to you our customer…..flexibility, customization, reporting, and customer service.
Customized
Pharmacy Benefit Management
Health & Wellness
Integrated

12. Service Excellence

13. Service Excellence Customer Service Results
2015
2016
Call Center
Calls Resolved on First Contact
95%
97%
% of Calls Answered Within 30 Sec
75%
73%
Average Speed of Answer
26 sec
29 sec
Caller Satisfaction
Real-Time Audit of Calls
96%
Web Chat
11 sec
16 sec
% of Chats Answered Within 10 Sec
87%
99%
Same and better than industry benchmarks/matrix.
97% of caller when they hang up their issue has been resolved.
The remaining 3% are resolved within 48hours….claim correction or review, eligibility, anything that requires referral outside that business unit.
Call satisfaction is measured by… random selected 2% of callers is asked if they would like to take a 5 question survey which is ed. Any negative responds (below acceptable level) are followed up telephonically or via to find out why they rate the experience that way and what could be done differently.
Accuracy of call audits - Two people dedicated to auditing calls live and record – to identify training needs and trends about certain issues in all business units – ID card example.
LSP NOTES:
93% of caller when they hang up their issue has been resolved.
The remaining 7% are resolved within 48 hours….claim correction or review, eligibility, anything that requires referral outside that business unit.

14. Service Excellence Claims Operations Results
2015
2016
Average Claim Turnaround
4.5 days
5.3 days
Auto Adjudication
59.2%
60.6%
Claim Procedural Accuracy
99.8%
Claim Financial Accuracy
99.5%
99.7%
% of Electronic Claims
99%
Average claim turnaround is 5 business days – the goal is 10 days.
Low auto adjudication numbers (industry is somewhere around 75-80) is due to high standards for accuracy affords by a very careful implementation process.
Claim procedural and financial accuracy is based on combination of claim audits, customer service referral, new group audits and check run audits and adjustment audits (re-work transactions)
High percent of electronic claims due to technology and recruitment and resources to build out electronics to where they are today.
LSP NOTES:
Average claim turnaround is 5.3 business days – the goal is 10 days.

15. The Changing Landscape of Health Care – Trends
Employer offers self-funded plan to 26

16. Reference-Based Pricing Limited/High Performance Networks
Industry Landscape Current Environment – All Players Concerned about the Future
Employer Concerns
Member
Concerns
Focus on Affordability
Changing landscape with ACA
Uncertainty of Future Company Viability
Want a Voice in their Care
Want Choice in Benefits/Providers
Want Affordability
Emerging
Models
PCMH
Value-Based Pricing
Reference-Based Pricing
Limited/High Performance Networks
Provider Concerns*
Payer Concerns
Need for Quality Focus
Need to Deliver Affordability
Need to Deliver Transparency
Shrinking Reimbursement Levels
Access to Information
Need for Quality Focus
Technology Challenges
ICD-10
* Source: BeckersHospitalReview.com

17. Industry Landscape Triple Aim Commitment
Population Health
TRIPLE AIM COMMITMENT
Experience of Care
Cost Per Capita

18. MedCost & MedCost Benefit Services
Industry Landscape Current Environment – All Players Concerned About the Future
Price sensitive market focused on affordability
Health care reform and provider consolidation continue to drive increased costs
Innovative solutions needed for old and new problems
Growth in consumer driven health plans (HDHP) to drive individual responsibility
Health Care Reform is a catalyst for change
Private Exchange: 33% of employers would consider offering
ACA concerns expand interest in self-funding to smaller employers
Government programs seeking more affordable options
Movement of “pay for volume” to “pay for value”
Employers expect different and effective solutions
Physicians/hospitals moving to valued based models (ACOs/CINs)
Medicare/Medicaid costs driving innovative payment structure
Success/ Effectiveness to be determined
Increasing focus and popularity of self-funding
Effective management of health plan costs
Timely response and issue resolution
Commitment to reinvesting in technology
Solutions management
Experienced partner
TIP: Use this slide to discuss and probe for what your audience is interested in, i.e., “When thinking about providing this important benefit to your employees, in today’s environment, what are your concerns?”
Very Price Sensitive Market -- Primary focus is affordability
Sluggish economy pressures health cost trend
Health care reform will increase costs in 2014
Innovative solutions needed for old and new problems
Individual consumers making benefit purchase decisions
Health Care Reform is a catalyst for change
Private Exchange: 56% of employers would consider offering
PPACA concerns spark interest in Self-Funding
More larger employers and smaller employers
Government programs seeking more affordable options
Movement of “pay for volume” to “pay for value”
Employers expect different and effective solutions
Administrative, Clinical, Wellness and Payment
Physicians/hospitals moving to valued based models (ACOs)
Medicare/Medicaid costs driving innovative payment structure
TRANSITION: More and more employers are venturing into self-funded benefits plans. For groups new to these funding arrangements, the benefits of teaming with an experience partner can’t be overstated.
MedCost & MedCost Benefit Services

19. Value Based Reimbursement Methodologies
Focuses on reducing inappropriate care and identifying and rewarding best-performing providers
Medical Home Models Incentives for primary care to coordinate care and meet specific quality metrics. Primary care physicians are paid an additional PMPM for their care coordination efforts in addition to fee for service (PPO model)
Pay for Performance Provider payments based on meeting defined quality metrics. Some tiered models being defined as Pay for Performance are actually based on moving providers with the best pricing (discount) into a higher reimbursement tier
Bundled Payments Identify specific episodes of care and determine reimbursement for the episode that bundles payment for all service providers involved
TIP… Use this slide to provide examples of how MedCost is constantly monitoring industry trends and innovations and then adopting new methodologies to reduce inappropriate care reward high performing providers.

20. Network Pricing Transparency
Member Price Comparison Tool
Allows members to access episodic costs for certain medical procedures, based on the MedCost PPO provider allowable
75 different procedures
Nationally recognized quality indicators and members’ feedback about provider experiences
Within our network we have invested in technology to promote true pricing transparency with…
HealtheReports Member Price Comparison Tool
Allows members to access episodic costs for certain medical procedures, based on MedCost Network provider allowable
Currently 64 different procedures
View nationally recognized quality indicators and feedback from other members on experiences with a particular provider
TRANSTION to Managing the Health of Your Population… We’ve talked about bare-bones of an employer’s health care plan – benefit design, admin services and network. But we don’t stop there.

21. Care Management

22. The Mission of Care Management
Manage member needs while promoting efficient use of health care resources with targeted assessment • education • intervention
TIP: Use this slide to introduce MedCost’s Care Management programs and the deep and wide bench of experience and expertise used to help individuals living with illness and manage costs in the Acute, Chronic and Catastrophic health care settings. Under the “Care Management” umbrella we offer Utilization Management programs (aimed at Acute population), Nurse Coach and Disease Management programs (aimed Chronic population), and Catastrophic Case Management programs.
Average Tenure
22 years nursing experience
22 years management team
Staff Expertise
22 nurses on staff including 8 CCMs
Clinical Leadership
Seasoned Medical Director and panel of 70 physician consultants

23. Utilization Management Process Focus
Balance the needs of the patient with an efficient process for the provider to achieve top quality outcomes
PATIENT
PROVIDER
Eligibility Verification
Service Review
Proactive Discharge Planning
Timely Notification
Referral to MedCost Care Management Support Programs
Web and Telephonic Certification Available
Immediate Referral Assignment
Eligibility Verification
Timely Notification
Peer-to-Peer availability per Providers schedule
TIP: Use this slide to introduce MedCost’s Care Management programs and the deep and wide bench of experience and expertise used to help individuals living with illness and manage costs in the Acute, Chronic and Catastrophic health care settings. Under the “Care Management” umbrella we offer Utilization Management programs (aimed at Acute population), Nurse Coach and Disease Management programs (aimed Chronic population), and Catastrophic Case Management programs.

24. Utilization Management Program Results
2015
2016
National Avg1
Inpatient Review
Days per 1000 lives
145
139
168
Admissions per 1000 36 33
Readmission rate within 30 days
4.5%
3.8%
7.9%
Average certified days
4.0
4.2
4.7
Requested days not certified2
13.2%
12.9%
Outpatient Review
ROI
5.7:1
5.4:1
Procedures not approved 4%
4.3%
MRI3
4.7%
5.3%
CT Scan4
3.9%
MedCost’s discharge planning and utilization review received Best Practice designation from a national consulting firm indicating that our programs validating the strength of our programs.
1 MCG Guidelines 21st Edition
2 Cost avoidance of approx. $4,800 per day avoided
3 Cost avoidance of approx. $2,907 per procedure avoided
4 Cost avoidance of approx. $4,112 per procedure avoided

25. 2016 Care Management Outcomes
CASE MANAGEMENT
PERSONAL CARE MANAGEMENT
SMARTSTARTS
TELADOC
Participation Rate
95%
ROI
5:1
Patient Satisfaction
100%
Participants with High Risk 65%
ROI
33:1
Patient Satisfaction
100%
Participants with Positive Health Status Change
90%
Reduction in A1C 90%
Reduction in Blood Pressure
48%
Reduction in Avoidable ED Visits 4
ROI Range
3:1 to
6:1

26. Explaining Pharmacy Trend
Price Inflation
Big driver!
Manufacturer price hikes
Estimated 16-17% increase in brand-name and specialty drug costs per year
Specialty Medications
Treatment of rare, previously untreatable diseases
Influx of new drugs to market
Accounts for approximately 35-45% of pharmacy spend, expected to increase to 50% by 20181
Increased Utilization
Healthcare knowledge more readily available
Emphasis on health & wellness
Generics control increasing trend by promoting competition
Notable in 2016: Crestor, Zetia, Benicar
Problems? biosimilars, patent extenders
Estimated 80 Rx TV commercials per hour, 24 hours a day2
28% of patients ask their doctor about a Rx seen advertised & 12% say their doctor prescribed the advertised medication3
Patent Expirations
Advertising
American Journal of Managed Care, “The Growing Costs of Specialty Pharmacy—Is This Sustainable?”, Feb 8, 2013.
NPR.org, “Selling Sickness: How Drug Ads Changed Health Care”.
Kaiser Family Foundation, “Prescription Drug Costs Remain Atop the Public’s National Health Care Agenda, Well Ahead of Affordable Care Act Revisions and Repeal”,

27. Care Management Program Integrated Care Team with the Provider
MedCost Care Managers connect with the entire clinical care team to meet the patient goals through support of the providers treatment plan
Educates patient to close clinical gaps in care
Facilitates Home Health Care, Durable Medical Equipment,
etc.
Notifies PCP of ER utilization, clinical gaps in care, current and predictive risk factors
Provides social and financial support and referrals
Coordinates high cost specialty medications
TIP: Use this slide to introduce MedCost’s Care Management programs and the deep and wide bench of experience and expertise used to help individuals living with illness and manage costs in the Acute, Chronic and Catastrophic health care settings. Under the “Care Management” umbrella we offer Utilization Management programs (aimed at Acute population), Nurse Coach and Disease Management programs (aimed Chronic population), and Catastrophic Case Management programs.
MedCost Care Manager

28. Managing the Health of Your Population
Health & Wellness
Acute
Health Promotion
Health Risk Assessment
Biometric Health Screenings
Health Coaching
Gaps in Preventive Care Member & Provider Outreach
Behavioral Health
Substance Abuse
Depression
Anxiety
Chronic Pain Management
Health and Wellness Toolkit
Personal Health Suite Online Resource
Lifestyle/Behavioral Health Programs
Personal Health Record
Health Tools & Trackers
Utilization Management
Inpatient & Outpatient Care Review
All inpatient admissions
MRI, CT, PET
Behavioral Health Intermediate Levels of Care
Emergency Department Utilization Outreach
Pre/Post-Discharge Planning
Telehealth
At-Risk/Chronic
TIP: If necessary this single slide could be used to explain MedCost’s 1)Health and Wellness and 2) Care Management programs that addresses the entire continuum of care to manage medical and Rx claims cost. From healthy and staying healthy to assisting those living with illness, we can design a custom solutions that leverages the greatest cost control opportunities.
Nurse Coaching and Chronic Disease Management
Personal Care Management
Nurse Coaching
Transitional Care
Cellular-Enabled Diabetes Management Solution
Maternity Management (SmartStarts)
Chronic Disease Education
Complex
Complex Case Management
Transplants
Dialysis
Oncology
Behavioral Health
Rehab
High Risk Maternity
Chronic Complex

29. MedCost Administration

30. MedCost Network
Request for verification of benefits should be directed to the claim administrator as indicated on the member’s ID card. MedCost does not maintain member level eligibility.
Plan design will vary by each individual employer group.
Ensure you check benefits so that you may collect appropriate co-payment or co-insurance amounts at the time of service.
Provider may collect co-insurance amounts based on actual charge.

31. MedCost Network Online Tools – Non-Secure Portal
No registration/password required and have access to the following:
Locate a Provider
Provider Manual (part of your contract)
Update Demographics
Credentialing Information
Provider Education
Payers with Online Claim Status
News – register for eCommunications

32. MedCost Network Online Tools – Secure Portal
Under MedCost Network - Web Applications Services, you can select from the following to obtain useful information:
Claims Repricing Inquiry
Reference Guides
Physician Claim Activity Report
Facility Claim Activity Report
Fee Allowables

33. MedCost Benefit Services - TPA Online Tools – Secure Portal
Under MedCost Benefit Services, you can select from the following to obtain useful information:
View claim status (search by claim number, patient name or date range)
View member eligibility
Display benefit plan details
Submit NPI numbers
Contact customer service

34. Thank You For Participating!
Contact Information
Customer Service Contact Center
Monday - Friday, 8:30 a.m. to 5:00 p.m.
Visit our website at
Thank You For Participating!

35. Questions?