Novant Health Innovation in Healthcare Dr. William Bill Hammill, MD - PowerPoint PPT Presentation

Novant Health Innovation in Healthcare Dr. William “Bill” Hammill, MD Senior Physician Executive Chairman and Service Line Leader – Department of Pediatrics Novant Health Making healthcare remarkable

NOVANT HEALTH – Who We Are We are an integrated system of physician practices, hospitals, outpatient centers, and more – each element committed to delivering a remarkable healthcare experience for you and your family. With world-class technology, personal connections, and care that’s easier to access and understand, Novant Health is with you every step of the way on your journey to health and wellness. Our promise is to deliver remarkable healthcare. Part of that promise involves being proactive in the communities we serve and helping people to be healthier every day. We aren’t just here when our patients are sick; we’re with them every step of their journey toward health and wellness. That means reaching out, starting conversations and staying engaged. And most of all, it means inspiring and empowering communities to stay healthy. 2 Novant Health: Enter Presentation Title in Footer Menu 10/31/2012

Vision Values Mission Novant Health exists Diversity and Inclusion We, the Novant Health team, to improve the health will deliver the most remarkable Teamwork of communities, one patient experience in every Personal excellence person at a time. dimension, every time. Courage Compassion Safety • Quality Authentic personalized relationships Voice & choice • Easy for me Affordability Our people We are an inclusive team of purpose-driven people inspired and united by our passion to care for each other, our patients and our communities. Our promise We are making your healthcare experience remarkable. We will bring you world-class clinicians, care and technology – when and where you need them. We are reinventing the healthcare experience to be simpler, more convenient and more affordable, so that you can focus on getting better and staying healthy. Making healthcare remarkable

How it All Fits Together Rating Investments & Agencies Liquidity Capital Accounting External Debt Income Balance Environment Markets Statement Sheet Competition Banks Governance Operations & & Controls Performance Revenue Cycle Growth 4

Novant Health Environmental Look Back/ Look Forward Last 5 – 10 Years Next 5 – 10 Years  Pressure on pricing  Reimbursement changes ‒ Site-neutral payments  Increasingly uncertain state regulatory ‒ Pay for performance environment – changes to CON  M&A activity has grown steadily and  Emergence of consumer anticipate increased consolidation of hospital systems  Emergence of value based care and population health  Federal regulatory reform – changes to the Affordable Care Act  Improving financial environment  State regulatory reform  Payor mix changes with the enactment of the Affordable Care Act ‒ Managed Medicaid program ‒ CON fully/partially repealed? ‒ Medicaid expansion?  Consumerism 5

Changing Environment Recent Past Near-Term Medium-Term (2012 – 2016) (2017 – 2019) (2020 – 2025) • No Medicaid expansion • Regulatory/political • Expect drug pricing to in any of our footprint uncertainty (future of continue to be in the states ACA) spotlight • Significant investments • Continued shift towards • Increased focus on in IT (EHR) and process site-neutral payments value-based improvement reimbursements and • Growth of services bundled payments • Decrease in self pay and covered by bundled indigent care patients payments • Continued industry consolidation; new • Evolution of impact of partnership models MACRA, MSSP, and Medicare ACOs • Increased consumerism • Industry consolidation; new partnership models 6

CMS Payment Reform Impact on Novant Health  Medicare, Managed Medicare, and Medicaid reimbursement changes have been impacting us unfavorably by about $20 million per year for the past few years.  CMS has a stated goal of 80% of their payments to be based on “value” by 2020 so we will be forced to do more of the bundled payment arrangements.  Currently losing approximately $5 million a year on bundled/cost sharing arrangements but expect that to improve as we gain experience with this new framework.  Managed care payors may catch up with CMS and force more value-based payments and narrow networks.  CIN/ACO development by health systems will also likely gain traction. 7

Current State: Declining Admissions, Rising Employment, Something Has To Give… All Employees, Hospitals, Thousands, Seasonally Adjusted Inpatient Medicare Admissions (per 1,000 beneficiaries) 338 National, 270 2007 2008 2009 2010 2011 2012 2013 2014 2015 ____________________ Source: Medicare Administrative Data (CMS), Bureau of Labor Statistics 8

Non-Acute Activity Is At Record Highs Across the health services sector, volume is rapid and multiples are increasing 9

National Innovation in Healthcare Amazon Last year, Amazon bought online pharmacy PillPack. It also announced a partnership with Warren  Buffett’s Berkshire Hathaway (BRKB) and banking giant JPMorgan Chase (JPM) to create a new health care company that they touted would be “free from profit-making incentives and constraints.” Experts expect more deals like this in the future since nobody in Silicon Valley will want to let  Amazon get a big head start on health care. “Tech companies can either sit back and wait to see if Amazon messes up in health care or they  can get involved now,” said Don Townswick, director of equities portfolio management at Conning. Microsoft and Walgreens Microsoft (MSFT) announced a partnership with Walgreens Boots Alliance (WBA).  As part of the deal, Microsoft will become Walgreen’s new cloud provider.  The two said they will also work on solutions to lower health care costs.  Walgreens will open up 12 “digital health corners” in stores that will sell health care-related  gadgets. The two companies said the partnership will help Walgreens gain personalized data about their  customers’ health, which will allow pharmacists to give better, customized nutrition and wellness solutions. 10 Novant Health: Novant Health and Innovation in Healthcare 02/07/2019

United Healthcare’s Value-Based Care Results – Screen More, Use Hospitals Less… And this is just for one payer… https://www.uhc.com/content/dam/uhcdotcom/en/ValueBasedCare/PDFs/UHCvaluebasedcare_factsheet.pdf 11

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Novant Health and Innovation in Healthcare 13 Novant Health: Novant Health and Innovation in Healthcare 02/07/2019

Doing More with Less  Healthcare Reform and federal/state budget pressures have forced not-for-profit hospitals to deliver higher-quality care with reduced reimbursement  Hospitals and health system must be proactive in implementing various strategies in order to do more with less ‒ Redesign delivery of hospital care to achieve lower costs ‒ Increase physician alignment ‒ Implement growth strategies to increase scale and reduce costs ‒ Improve balance sheet by increasing reserves and reducing risk ‒ Add expertise to board and executive management “The strategic shift now taking place will challenge business models and require forward thinking strategies to manage through a transition period that will unfold over the foreseeable future.” – Moody’s Investors Services 14

Novant Health and Innovation in Healthcare CNA to RN Program Charlotte, N.C. – August 29, 2018 – Novant Health and Atrium Health are  announcing an initiative to support the professional development and advancement of certified nursing assistants (CNAs) to the position of registered nurse (RN). Atrium Health and Novant Health are piloting this CNA-to-RN scholarship program for CNAs in the Charlotte area as a joint ONE Charlotte Health Alliance effort. The first scholarships have been offered to 10 CNAs – five at each health system – interested in becoming registered nurses. The two health systems collaborated to identify CNAs as a segment of team  members to pilot career growth programs. This pilot program serves as an upward mobility initiative to support internal advancement and improve financial well- being among team members, particularly those living in priority zip codes as identified in the Charlotte Opportunity Task Force. 15 Novant Health: Novant Health and Innovation in Healthcare 02/07/2019

Novant Health and Innovation in Healthcare Project 658/Smith Family Wellness Center Movement Family Wellness Center 16 Novant Health: Novant Health and Innovation in Healthcare 02/07/2019

Novant Health and Innovation in Healthcare Michael Jordan Clinics 17 Novant Health: Novant Health and Innovation in Healthcare 02/07/2019

Novant Health and Innovation in Healthcare Mecklenburg County / CRC Partnership 18 Novant Health: Novant Health and Innovation in Healthcare 02/07/2019