1. EXPERTISEPARTNERSHIP VALUE November 16, 2011 UNIVERSITY OF ALASKA 1 ST QUARTER FY12 UTILIZATION REVIEW – 7/1/2011 TO 9/30/2011 TRENDSANALYSISSTATISTICSPLANNINGTOOLS

2. Premera – Medical

3. Premera Medical – Inpatient & Outpatient 3  Inpatient − Paid claims per member per month for inpatient services decreased significantly from $85.94 for 1 st quarter FY11 (7/10-09/10) to $64.11 for 1 st quarter FY12 (07/11-09/11)  Large Claims stabilized between 1st quarter FY12 compared to FY11 − The average length of stay for inpatient services decreased from 4.03 to 3.61 and 1 st quarter FY 12 was below the Premera Norm of 4.19  Outpatient − Visits per 1,000 members for outpatient services increased from 1,069 to 1,116 from 1 st quarter FY11 to FY12 but was well below the Premera Norm of 1,155 − Services per 1,000 members for outpatient services increased slightly from 4,255 for 1 st quarter FY11 to 4,286 for 1 st quarter FY12 but was below the Premera Norm of 4,395 − Paid claims per service decreased 10.8% from 1 st quarter FY11 to 1 st quarter FY12

4. Premera Medical – Emergency Room & Large Claims 4  Emergency Room − Paid claims per member per month for ER services decreased from $17.81 for 1 st quarter FY11 (7/10-09/10) to $16.34 for FY12 (7/11-09/11) and the paid claims per visit decreased 16% from $1,453.42 to $1,221.75 − Visits per 1,000 members for ER services increased from 147 for 1 st quarter FY11 to 160 for 1 st quarter FY12 but are below the Premera norm of 209  Large Claims − Large Claims stabilized between 1st quarter FY12 compared to FY11  There are 7 large claimants over $100k for FY12 YTD  The average large claimant paid amount decreased from $195,549 to $129,591, a 33.7% decrease from 1 st Qtr FY 12 to 1 st Qtr FY11  Large claimants in the 1 st quarter FY11 made up 42.6% of the total medical and Rx claims whereas for 1 st quarter FY12 it is 22.4%  There were 10 large claimants over $100k in the first quarter FY11 − 2 of those 10 claimants were over $300k

5. Medical Utilization 5 Norm is based on Premera’s Alaska large group book of business

6. Large Claims Analysis 6

7. Top 30 Large Claimants– 1 st Quarter FY12 7

8. Top 30 Large Claimants– 1 st Quarter FY11 8 Claimant #’s 1, 2, and 4 dropped off in 2012. Claimant #3 remains #3 in 2012

9. Major Diagnostic Category 9 Musculoskeletal system continue to be #1 Genitourinary Systems jumped from #9 to #3 Neoplams dropped from #2 to #6

10. Caremark - Pharmacy

11. Pharmacy Observations 11  The number of total scripts/claims from FY12 1 st quarter (7/1/11 to 09/30/11) decreased 4.9% compared to FY11 1 st quarter (7/1/10 to 09/30/10)  The number of mail order scripts/claims increased 52.3% from FY11 to FY12 1 st quarter − Introduction of mail order for maintenance drugs at 7/1/2011  The total gross costs increased $205,641 from FY11 to FY12 1 st Quarter from $1,965,996 to $2,171,637  The generic dispensing rate increased from 65.1% to 68.1%, a 4.7% increase  Specialty drug gross costs increased 25.7% and made up 13.8% of the total gross pharmacy cost

12. Pharmacy 1 st Qtr FY 11 to FY12 Comparison 12

13. Top 25 Drugs by Gross Cost 13

14. Appendix

15. Medical Utilization Definitions 15  Contract Months – Number of enrolled employees for a 12 month period  Medical Total PMPM – Total medical cost on a per member per month basis  Inpatient – Services provided to patients who are hospitalized  Outpatient – Hospital based services where the employee is not admitted  Professional – Primary Care or Specialist Care Physician services  Average Contract Size – The average number of dependents (Spouse and Children) for each enrolled employee

16. 16 Our Mission To be the worldwide value and service leader in insurance brokerage and risk management services Our Goal To be the best place to do business and to work www.lockton.com © 2009 Lockton, Inc. All rights reserved. Images in this publication © 2009 Jupiterimages Corporation