the future health ecosystem today - cascadia capital · 2019-01-22 · big data patient engagement...

The Future Health Ecosystem Today

1 | @chasedave

> The Future Health Ecosystem Today

> Current Problems

> Clinical Care

> Patient-Centric Care

> Wellness & Prevention

> Overview of Cascadia Capital

CONTENTS

2 | @chasedave

THE FUTURE HEALTH ECOSYSTEM TODAY

3 | @chasedave

THE FUTURE HEALTH ECOSYSTEM WILL FOCUS ON THE TRUE DRIVERS OF OUTCOMES

Source: RWJF/UWPHI.3

GENETICS DIET & EXERCISE

TOBACCO USE

ALCOHOL & DRUG USE

SLEEP SEXUALACTIVITY ACCESS

TO CAREQUALITY OF CARE

EDUCATION EMPLOYMENT INCOME FAMILY/SOCIAL

SUPPORT

COMMUNITY SAFETY

AIR QUALITY

WATER QUALITY

HOUSING TRANSIT

4 | @chasedave

Vector 2:Evidence-Based Decisions

Vector 3:B2C Health

Improvement Programs

Vector 1:Next Generation Primary Care

Sleep Tracking/ Testing:Wearables/Hardware

Personalized Medicine/Genomics

Health Information

Care Navigation

Disease Management

Peer Networks

Health Coaching

Decision-Making Tools

Care Access

Remote Patient Monitoring

Patient Engagement

Wellness Programs

GENETICS DIET & EXERCISE TOBACCO USE ALCOHOL & DRUG USE SLEEP SEXUAL ACTIVITY

Family Support and Self-Help

Patient Groups

Source: RWJF/UWPHI.

5 | @chasedave

Vector 5:Analytics and

Clinical Decision Support

Vector 2:Next Generation

Primary Care

Vector 3:Value-Based Care

Vector 4:Operational Efficiency

Vector 1:Disease-Specific Care Pathways

Transparency

Virtual MedicineRemote Patient

Monitoring

Retail Clinics, DPC

Care Coordination

Patient EngagementBig Data

Personalized Medicine

Medication Management

Nanotechnology

House Calls

Practice Management, EMRs, Pharmacy Management

ACCESS TO CARE QUALITY OF CARE

Tech-Enabled Services

Knowledge Sharing

Source: RWJF/UWPHI.

6 | @chasedave

Advance Directives Programs/Services

Next Gen Benefits

Social Services Access/Management

Vector 1:Equilibrating

Healthcare Expense

Vector 2:Community-Based Health Initiatives

Vector 3:Aging & End-of-

Life Programs

House Calls Hospice Programs

Virtual Medicine

Incentive ProgramsWellness Programs

EDUCATION EMPLOYMENT INCOME FAMILY/SOCIAL SUPPORT

COMMUNITY SAFETY

Early ID and Prevention Programs

Source: RWJF/UWPHI.

7 | @chasedave

GPS-Enabled SensorsVector 1:Targeted

Monitoring and Rapid Response

Vector 2:Community-Based Health

InitiativesFood, Housing and

Transportation Access

Next Generation Public Transport

Environmental Response Mechanisms

Continuous Monitoring (wi-fi, bluetooth, etc.)

Vector 3:Affordable Living

and Access

AIR QUALITY WATER QUALITY HOUSING TRANSIT

Built Environment Design

Broadband Connectivity

Source: RWJF/UWPHI.

8 | @chasedave

Personalized Medicine

Continuous Monitoring of Clinical and Non-Clinical Data

Better Understanding of How Patient Behaviors

Affect Outcomes

Episodic to Real-Time, Micro-Targeted Care

Predictive and Actionable Analytics

Access to Care

Proactive Medicine > Reactive Medicine

Care Coordination

Enhanced Cell Identification and Tracking

THE PREVIOUSLY UNFATHOMABLE WILL BECOME A REALITY

CURRENT PROBLEMS

10 | @chasedave

A STARK IMBALANCE WITH DRAMATIC REPERCUSSIONS

Source: RWJF/UWPHI; Bipartisan Policy Center.

4%Health

Behaviors

8%Other

88%Medical Services

10%Physical

Environment

20%Clinical Care

30%Health

Behaviors

40%Social &

Economic Factors

What Drives Outcomes? Where Do We Spend Money?

Unhealthy Workforce

Collateral Damage Chronic Disease

Obesity

Wasted Spending

Overtreatment

11 | @chasedave

THE SWANS ARE IN THE WATER, BUT WHAT COLOR ARE THEY?

Cadillac Tax A consumer movementis triggered Aging-in-place Medicare pricing expands

to self-insured

Medicare allowed to negotiate with pharma

Tax-exempt healthsystems lose status

State AG’s pursue physician non-competes

The bursting of thehospital bond bubble

Like the newspaper/publishing industry at the internet’s inception, the healthcare industry is on the verge of its transistor moment. Which of today’s healthcare incumbents will fail to survive?

12 | @chasedave

HEALTHCARE’S COLLATERAL DAMAGE IS SIGNIFICANT

> State budgets for healthcare coverage vs other priorities

Mental Health Public Health Education Human ServicesInfrastructure

& HousingLaw &

Public Safety Local Aid

$0 B

$3 B

$6 B

$9 B

$12 B

$15 B

-22% -31%

-12%

-11%

-14%

-13%

-51%

FY01

FY14

GIC, MassHealth & other coverage

+ $5.4b+ 37% −$3.6b

− 17%

Source: Massachusetts Budget and Policy Center; figures all adjusted for GDP growth.

% change

13 | @chasedave

AN UNHEALTHY WORKFORCE BURDENS EMPLOYERS AND ECONOMY

SMOKING

+ $5,800

Additional annual costs per employee with various lifestyle risks

> Lost Revenue$1,900-$2,250

per employee per year

> Lost Employee Time45,000,000 avoidable

sick days per year

> Lost Output$576 billion is lost by the U.S.

economy due to workforce illness

Poor employee health leads to...

And adds costs to employers budgets

DIABETES

+ $4,413OBESITY

+ $4,237HIGH BLOOD PRESSURE

+ $1,077

Source: Berman et al., tobaccocontrol.bmj.com; NBCH, Februrary 2012; Van Nuys et al., American Journal of Health Promotion, May/June 2014; Kowlessar et al., JOEM, May 2011.

14 | @chasedave

OUR POPULATION IS AGING AND SICKER THAN EVER

50+ 65-74

> The U.S. population aged 50+ is expected to grow to 132mm...

2010109mm

2030132mm

203039mm

…and the number aged

65-74 will nearly double

201022mm

$0.75 of

every $1 spent

> Chronic disease is an epidemic that is expected to worsen...

...and account for the vast majority of healthcare expenditures

2010 2030

TOTAL(MM) 149mm 171mmPROPORTION 48% 49%

15 | @chasedave

THIS GENERATION’S TOBACCO: SUGAR AND A SEDENTARY LIFESTYLE

> For every additional serving above the USDA’s recommended 12 tsp sugar per day, a child is 60% more likely to become obese.

4x# of TVs in homeshas QUADRUPLED

2x# of foodservice establishments has DOUBLED

2x 3xSoda consumption has DOUBLED in girls, and

TRIPLED in boys

Obesity in children aged 6-11

1980

6.5%2008

19.6%

2010

1 in 3children are

overweight or obese

1+hrs

7.5 hrsDAILY SCREEN TIME

1.5hrs4.5hrs

for children ages 8-10 (2009)

Soft drink consumption has spiked

1978 2002

16.9 oz/day 26.8 oz/day

12tsp sugar 22tsp HFCS

Source: CDC; Whitehouse.gov.

16 | @chasedave

$210bnUnnecessary Services

$190bnAdministrative Costs

$130bnInefficient

Delivery of Care

$55bnPrevention

Failures

$105bnInflated Prices $75bn

Fraud

U.S. HEALTHCARE WASTE = NETHERLANDS GDP

$765bnin wasted spending

Source: Institute of Medicine (2009 data); The World Bank (2009 data)

17 | @chasedave

AND TOTAL HEALTHCARE SPENDING IS SEVERELY DISPROPORTIONATE

5% of patients

50% of dollars

Source: U.S. Agency for Healthcare Research and Quality.

18 | @chasedave

Angiogram

CT scan, head

Cost per hospital day

Appendectomy

Hip replacement

Coronary artery bypass

LOWER COST PROCEDURES

HIGHER COST

HIGHEST COST

$30 $800

$1000

$1350

$68,000

$100

HIGHER PRICES = HIGHER SPENDINGArgentina, Canada, Chile, India France, Germany, Spain, Switzerland United States

Source: International Federation of Health Plans. Graphic: Wilson Andrews - The Washington Post. Published March 2, 2012.

19 | @chasedave

HIGHER SPENDING ≠ BETTER HEALTH OUTCOMES

Rank Country

1 France

2 Switzerland

3 Denmark

4 Netherlands

5 Australia

6 Canada

7 Germany

8 Norway

9 UK

10 U.S.A

11 New Zealand

Rank Country

1 UK

2 New Zealand

3 Switzerland

4 Canada

5 Norway

6 Australia

7 Netherlands

8 France

9 Denmark

10 U.S.A

11 Germany

Diabetes Extremity Amputation(1=best)

Asthma Mortality (1=best)

2.5xAsthma

6.7xDiabetes

3.0xCongestive Heart Failure

> U.S. chronic disease hospital admissions compared to peer countries

Source: OECD Health Care Quality Indicators Data 2009, data from 2007, compared to Canada; OECD Health Data 2011, The Commonwealth Fund

20 | @chasedave

22

Knee Replacements 1stTonsillectomy 1stMRI Exams 2rdCT Exams 3rd

VOLUME INCENTIVE = OVERTREATMENT AND SPECIALTY-RICH CARE

87.5% of U.S.

physicians are specialists

61.3% OECD average

> HAIs: Longer stays, more provider volume

5

98,987People die annually in

the U.S. from HAIs, more than breast cancer

and prostate cancer COMBINED

Average hospital stay (days)

28k

Prostate Cancer

41k

BreastCancer

99k

HAIs

> USA winning the race for most procedures

Source: GE, JESS3; OECD Health Data 2012.

21 | @chasedave

“Physician burnout climbs 10% in 3 years, hits 55%”- MEDSCAPE

LAYERING BUREAUCRACY ON TOP OF FLAWED SYSTEM, PLACING STRAIN ON ALREADY DISGRUNTLED PHYSICIAN WORKFORCE

Source: Medscape’s 2014 Physician Compensation Report; 2014 Survey of America’s Physicians.

Do not feel fairly compensated50%Would not choose medicine as their career today42%

Plan to accelerate retirement39%Plan to limit access to their practices

44%

Anticipate ICD-10 will cause severe problems in their practice

50% Physicians transitioning tocash-only (2011-2013)100%

CLINICAL CARE

23 | @chasedave

1. Government intervention = catalyst

2. Employers shifting risk and insurers responding to regulation and a new marketplace for covered lives

3. Providers must respond to shifting reimbursement, cost sharing, and volume reallocation> And are beginning to do so in a number of ways

4. The era of open information in healthcare is underway> But there is still a long way to go to begin realizing the value of population health

5. Keeping patients out of the hospital, and on the internet> But an uncertain regulatory landscape is stifling growth

CLINICAL CARE OVERVIEW

24 | @chasedave

GOVERNMENT INTERVENTION = CATALYST

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Mar: PPACA

> HITECH Act: a bonanza for incumbent EHR vendors

Feb: HITECH Act

Jan: ACO Medicare incentives

Oct: CMS payments for VBP

Jan: MLR, Stage 1 of Meaningful Use (MU)

Oct: Open enrollment begins

Jan: Individual Mandate

Medicaid expansion

Dec: Stage 2 of

MU

King v. Burwell

Medicare Access and CHIP Reauthorization Act

Stage 3 of MU

Jan: Cadillac Tax

> ACA driving shift from volume to value

> Cadillac Tax: a bonanzafor health innovators

GOALS

> Access> Standardization > Affordability

25 | @chasedave

EMPLOYERS SHIFTING RISK OR SELF-FUNDING

Percent of Covered Workers Enrolled in a $1,000+ Deductible Plan (Single Coverage by Employer Size) Percentage of Covered Workers in Self-Funded Plans

> ACA Benefits Standards Avoidable Through Self-funding

2009 2013 2000 2014

49% 61%

Source: Kaiser Family Foundation and Health Research & Educations Trust, “Employer Health Benefits 2013 Annual Survey,” August 2013; Gabel JR et al., “Small Employer Perspectives On the Affordable Care Act’t Premiums, SHOP Exchanges, and Self-Insurance,” Health Affairs; The Advisory Board Company.

40%

13%

58%

28%

Essential health benefits

1Modified

community rating

2Guaranteed issue and renewability

3MLR

Requirements

4

26 | @chasedave

95%

TRADITIONAL INSURERS ARE ADMINISTRATIVELY INEFFICIENT, HAVE CAPPED MARGINS, AND ARE IN A NEW BATTLEGROUND FOR CUSTOMERS

MLR Requirement Limiting MarginsPortion of Premium Dollars Mandated for Medical Care

Growth in U.S. Healthcare Workforce (1990-2012)

Portion of growth in doctors

Portion of growth in administrative staff

1DOCTOR

5NURSES

10ADMINS

Source: Bureau of Labor Statistics, NCHS, Himmelstein/Woolhandler analysis of CPS; The Advisory Board Company.

+75%New Market Issuers Offering Qualified

Health Plans On Exchanges

Federally-Facilitated Marketplace (36 states)

State-Based Marketplace (8 states reporting)

191

2014

248

2015

61

2014

67

2015

80%

Individual and Small-Group Markets

Large Group Market

85%

5%

27 | @chasedave

Prominent Employers Using Private Exchanges

172> Private exchange operators as of October 2014

PRIVATE EXCHANGE ENROLLMENT IS FORECASTED TO TAKE OFF

39

19

30

40

2014 2015 2016 2017 2018

Potential Growth Path for Private Exchange Enrollment

(mm lives)

Source: Accenture, “Are You Ready? Private Health Insurance Exchanges are Looming,”; privatehealthexchange.com; The Advisory Board Company.

> Low-wage employers most active to date

> Skilled industries in the wings

ACTIVE EMPLOYEES(MEDICARE ADVANTAGE, MEDIGAP PLANS)

RETIREES

28 | @chasedave

REIMBURSEMENT CUTS DEMAND A CHANGE IN OPERATIONS AND STRATEGY BY PROVIDERS

> Medicare FFS payment cuts and move to alternative reimbursement will be significant

Source: CMS; The Advisory Board Company

$260bnHospital payment rate cuts

(2013-2022)

$415bnTotal FFS rate cuts

(2013-2022)

50%Medicare alternative

payment target (2018)

29 | @chasedave

VOLUMES SHIFTING OUTPATIENT, AND THE GOVERNMENT WILL TAKE CONTROL OF THE INPATIENT SETTING

42% 58%

19%

15%33%25%

6% 2%

2012 2022

Average Inpatient Case Mix by VolumeN=785 hospitals

MEDICARE MEDICAID COMMERCIAL SELF-PAY

Source: “Report to the Congress: Medicare Payment Policy,” MedPAC, March 2014; The Advisory Board Company.

-20 -10 0 10 20 30 40

Neurosurgery

Orthopedics

Vascular Services

Cardiac Services

All Payer Volume Growth Projections(2013-2018)

INPATIENT OUTPATIENT

-11% 11%

16%

15%

17%

-3%

5%

14%

30 | @chasedave

RISK-SHARING AND THE INCORPORATION OF OPERATIONAL EXPERTISE ARE THE FUTURE

Risk-Based Revenue Breakdown (% of providers), N=116

71%

21%5% 3%

13%

39% 38%

10%0%

20%

40%

60%

80%

Under 25% 25-50% 50-75% Over 75%TODAY IN 3 YEARS

20% 25%25%

30%40%

30%

30%

30%25%

70%45%

20% 10%

FY 2013 FY 2014 FY 2015 FY 2016

EFFICIENCY OUTCOMES OF CARE PATIENT EXPERIENCE CLINICAL PROCESS

Medicare VBP Program Domain Weights

OTHER MANDATORY RISK PROGRAMS

HAIPenalties

Readmission Penalties

Source: 2013 Care Transformation Survey, The Advisory Board Company; CMS.

65%of the Medicare VBP

program will depend on quality metrics by 2016

31 | @chasedave

ACO GROWTH HAS RESULTED IN WIDENING REACH, BUT MANY ARE STRUGGLING TO REDUCE SPENDING

MSSP Cohort First-year spending reduction

Growth of Accountable Care Organizations (ACOs)

32 146 253 253109164

205 235

0

200

400

600

1Q12 3Q12 1Q13 3Q13

Medicare Non-Medicare

Source: Leavitt Partners; The Advisory Board Company.

67% Portion of U.S. population in a primary care area with an ACO

Portion of U.S. population treated by an ACO17%

Earned Shared Savings

25%

Reduced Spending But Did Not Earn Shared Savings

22%

Did Not Reduce

Spending53%

32 | @chasedave

High out-of-pocket costs...

COST SHARING BY PAYERS AND PATIENTS BRINGS WITH IT REPERCUSSIONS AND NEW OPPORTUNITY FOR PROVIDERS

> As a result, providers are turning to technologies that can improve referrals, marketing efforts and operational efficiencies, as well as reduce administrative burden.

Source: The Advisory Board Company; Aon Hewitt; “Medical Debt Among People With Health Insurance,” Kaiser Family Foundation; Bankrate.com; National Survey of Employer-Sponsored Health Plans 2014, Mercer.

…discourage utilization

Large medical bills...

…means more bad debt

Can’t meet the higher range of out-of-pocket health cost limits

63%

Don’t have savings to cover a $1,000

ER visit 62%

Americans struggling with medical debt are insured

70%Patients becoming price-sensitive...

…and more likely to shop

Forgoing care when sick or injured because of cost15%

Patients report using home remedies

instead of seeking medical attention

33%

Large employers now offer a price transparency tool77%

Average U.S. Employee will pay:

$2,487out of pocket/yr

$6,600 $13,200

Under ACA, 2015 out-of-pocket cost ceilings:

Worker’s share of costs

52%over last 5 years

33 | @chasedave

PAYERS

CLAIMS COSTS/FINANCE UTILIZATION EMR

PROCEDURES OUTCOMES

PRESCRIPTIONS

SUPPLY CHAIN

• Coordinated care• Improved outcomes• Interoperability• Population health

• Lower costs• Disease prevention• Adherence

SATISFACTION

THE ERA OF OPEN INFORMATION IN HEALTHCARE IS UNDERWAY

TRIAL RESULTS AND EFFICACY SALES AND DRUG HISTORY

• R&D productivity• Trial improvement

• Improving efficacy• Care access• Price transparency

• Convenience and cost• Good health

EXERCISE DATA PURCHASES BEHAVIORS, SOCIAL

DAT

A

PROVIDERS

GO

ALS

PATIENTS

DAT

AG

OAL

S

PHARMA

DATA

GO

ALSD

ATAG

OALS

CLAIMS COSTS

• Payment innovation• Data acquisition• Provider-performance

transparency

• Lowering costs• Reducing claims paid• Winning share• Wellness & prevention

34 | @chasedave

TRADITIONAL PAYERS ARE RESPONDING IN NUMEROUS WAYS

Source: The Advisory Board Company.

Tren

ds ✚ Omni-Channel Understanding and Delivery Model for Reaching Out to and Engaging with Consumers

✚ Relationships and Partnerships with Providers That Support Value-Based Reimbursement Models

✚ Private Cloud Solutions to Better Manage Data Collection, Aggregation, and Analytical Efforts

✚ Data Management and Warehousing

Tech

nolo

gy

Partn

ersh

ips

Health Matters

Cons

olid

atio

n

$38 billionJuly 2015

$1.25bn cost savings

$6.8 billion

July 2015

$52 billionJune 2015

$2bn cost savings$14 billion

March 2015

35 | @chasedave

SHIFT FROM VOLUME TO VALUE IS UNDERWAY, BUT A LONG WAY TO GO

...but many providers still don’t have financial “skin in the game”

47% of value-oriented payments

exclude financial risk

Commercial health plans have dramatically shifted how they pay physicians and hospitals...

% of commercial health plan payments that are value-based

2013 2014

11%

40%

% of patients attributed to a provider with a payment reform contract

2013 2014

2%15%

10% of payments to specialists

are value-oriented

24%of payments to primary care physicians are value-oriented

Source: The Scorecard of Payment Reform 2014, Catalyst for Payment Reform; plans responding represent 65% of commercially-insured lives in the U.S.

36 | @chasedave

WHILE HOSPITALS FOCUS ON M&A, INNOVATORS ARE INNOVATING

Hospital M&A Activity has accelerated Partnerships and Affiliations on the rise

Heart & Vascular Center

Markey Cancer Center

020406080

100120

2009 2010 2011 2012 2013 2014 1Q2015

An incredibly fragmented U.S. hospital system

4,500 acute care hospitals 2,000 hospital companies

...means a perceived opportunity to control costs and coordinate care

Source: Pricewaterhouse Coopers.

37 | @chasedave

PATIENT REGISTRATION CARE COORDINATION INSURANCE ELIGIBILITY VERIFICATION

CODING SCHEDULING PATIENT STATEMENTS

ANALYTICS RCM E-PRESCRIBING

ACCOUNT ALERTS REFERRAL MANAGEMENT DENIAL MANAGEMENT

PROVIDERS ARE BEGINNING TO EMBRACE TECHNOLOGY TO STREAMLINE WORKFLOWS

38 | @chasedave

EHR INCUMBENTS USING TRADITIONAL STRATEGIES TO PROTECT MARKET POSITION

Fragmented Players

23% 9%

2014

CONCERNS

1DATA BLOCKING

2DATA SILOS

3VENDOR LOCK-IN

4POOR INFORMATION EXCHANGE

Source: MedScape EHR Report 2014.

10 YEARS AGO 2014

CONCERNS

39 | @chasedave

VENDORS THAT RESPOND TO POPULATION HEALTH-FOCUSED CUSTOMER NEEDS WILL WIN

Identification of various sub-populations with different needs

Tools that enable collaboration across providers, patients and payers

Tools that aggregate community level data

Ability to gather and incorporate continuous data on total populations

Solutions that analyze clinical, claims, and socioeconomic data

> Identifying, collecting, and utilizing actionable information will be critical

1 2 3

4 5

40 | @chasedave

BUT THERE IS STILL A LONG WAY TO GO TO BEGIN REALIZING THE VALUE OF POPULATION HEALTH

of payers and providers think a national public HIE is at least 10 years away

92%PHYSICIANS

81%HOSPITALS

94%INSURERS/PAYERS

remain meaningfully unconnected in regardsto intelligent interoperability

POPULATION HEALTH REQUIRES CHANGES IN THE BUSINESS MODEL OF CURRENT VENDORS

Open APIs and PaaSfor developers

HIE Application Ecosystem

Rapidly Extended Functional Capabilities

> Firms with a wide offering of population health tools, revenue cycle management services, patient portals, dashboards, and analytics will emerge as the next wave of health IT leaders

In effort to coordinate care, private exchanges will outpace public efforts

Cerner wins DoD contract with interoperability capabilities and partnerships

Epic launches Care Everywhere

Source: Healthcare IT News; HIMSS Analytics.

82%

REALITY TAKEAWAY/RESPONSE

REALITY TAKEAWAY/RESPONSE

41 | @chasedave

VIRTUAL MEDICINE HOLDS PROMISE

74%

Source: CDC; Truven Analytics; Center for Connected Health Policy, as of September 2014; Teladoc.

71%of employer-sponsored ER visits not necessary

417 mm(33%) could be treated

through telehealth

1.25bnAmbulatory care

visits per year in US

Employees are open to virtual care

Currently offer telehealth services

Plan to offer telehealth in coming year

54% of 18-29 Year Olds

49% earn > $71,000

53% work > 35 Hours

And Employers Are Responding

48%

42 | @chasedave

KEEPING PATIENTS OUT OF THE HOSPITAL IS THE NEW GOAL

“I think my job ultimately is to close every one of our hospitals...If it were my wife or my mom or my kids, I never want them in the hospital.” -- David Feinberg, CEO Geisinger Health System

REMOTE PATIENT MONITORING

201426%

of providers utilized some form of RPM

4m

Units

2020>20m

UnitsBlood pressure monitor market share

71%

Mount Sinai accountable care program(Sep 2010 – May 2012) resulted in:

• Paramedics trained for and completing home visits for high-risk patients

• 911 callers offered options besides ER• Nurse health line for non-emergency situations

RE-THINKING OPERATIONS

Admissions43%

ER Visits54%

Source: HIMSS Analytics; Allied Market Research; Berg Insight.

43 | @chasedave

BUT AN UNCERTAIN REGULATORY LANDSCAPE REMAINS

Mental HealthOffice VisitsSmoking Cessation

Substance AbuseWellness VisitProlonged Outpatient

Rural Eligible Facilities

Source: CMS; Center for Connected Health Policy.

FEDERAL LEVEL

Current Medicare Coverage

SERVICES LOCATION

Telehealth Enhancement Act of 2013

Medicare TeleHealth Parity Act of 2015?

Medicare Health Parity Act of 2014

STATE LEVEL

State Medicaid programs that reimburse for:

Live Video Store-and-forward Remote Patient Monitoring47 9 1629

States with telehealth parity laws

8States with proposed parity law

47States that require physician

to be licensed in state of patient

13States with cross-border

telemedicine license

44 | @chasedave

BUT THIS HASN’T SLOWED THE BATTLE TO BUILD A NETWORK

Business Model

Delivery Method Freemium B2C B2B2C

Video/Phone

Kiosks

Text

Store-and-forward

C O M P A N I E S / D E A L A C T I V I T Y / I N V E S T O R S

46 | @chasedave

PAYER MANAGEMENT/BENEFITS MANAGEMENT

CLINICAL CARE INNOVATORS

MOBILITY, VIRTUAL MEDICINE, AND REMOTE PATIENT MONITORING

CARE COORDINATION / NEW ENTRANTS

47 | @chasedave

CLINICAL CARE INNOVATORS

DATA ANALYTICS AND POPULATION HEALTH PRACTICE MANAGEMENT/RCM/PRODUCTIVITY TOOLS AND POC MANAGEMENT/EHR

48 | @chasedave

$63mm

$50mm

$16mm

$70mm

$58mm

$40mm

2013

WORKFLOWS ANALYTICS/PH TELEHEALTH OTHER

2014


2015


$40mm$85mm $29mm

$400mm $100mm $89mm

$78mm $54mm $45mm

$36mm $30mm $30mm

$131mm $125mm

$100mm $41mm

$25mm $21mm

$24mm $15mm

$81mm $50mm

$32mm $24mm

$21mm

$110mm

$82mm

$71mm

$101mm $41mm $19mm

NOTABLE RECENT FINANCINGS

$395mm $120mm $70mm

$55mm $54mm $25mm

$500mm

$178mm

$100mm

PRIVATE PLACEMENTS

49 | @chasedave

IPOs $131mm $261mm $1.3bnBENEFITS WORKFLOWS ANALYTICS

SEPT. 2013 OCT. 2013 APRIL 2014

$75mm $127mm $53mm $600mmWORKFLOWS BENEFITS BENEFITS ANALYTICS

JUNE 2014 JULY 2014 DEC. 2014 FEB. 2015

$223mm $196mm $100mm $157mmWORKFLOWS ANALYTICS WORKFLOWS TELEHEALTH

MAY 2015 JUNE 2015 JUNE 2015 JUNE 2015


50 | @chasedave

PATIENT-CENTRIC CARE

51 | @chasedave

1. Patients become educated price-seekers

> Entrepreneurs are empowering them

2. Decentralized medicine and physician extenders

3. On-demand is making its way to healthcare

4. Healthcare is the next extension of our online lives

5. Patient = center of future health ecosystem

> Stakeholders must respond to this new normal or perish

PATIENT-CENTRIC CARE OVERVIEW

52 | @chasedave

> The number of Americans with an HSA Account is expected to skyrocket

PATIENTS ARE BEING FORCED TO TAKE CONTROL OF THE HEALTHCARE THEY RECEIVE

$1.7bn $15.5bn

2006 2012

17mm 50mm

2014 2020

HSA enrollment in large employer plans

2006

4%

2007

5%

2008

8%

2009

8%

2010

13%

2011

17%

2012

19%

2013

20%

2014

20%

> HDHP/SO Enrollment for Employer-Sponsored Plans

74%

> National HSA assets have grown over 9x from 2006-2012

Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2014.

53 | @chasedave

AND SELF SELECTING INTO HIGH DEDUCTIBLE AND LEAN HEALTH PLANS

Annual Deductibles of Individual Plans Selected on eHealth (October 2013-March 2014)

Metal Tiers of Plans Chosen on public exchanges (All Enrollees; October 2013-March 2014)

<$50013% $500-$999

3%

$1,000-$1,99911%

$2,000-$2,9995%

$6,000+38%

Silver64%Gold

9%

Platinum 5%

Catastrophic2%

Bronze 20%

Source: Breakaway Policy Strategies, “Eight Million and Counting: A Deeper Look at Premiums, Cost Sharing and Benefit Design in the New Health Insurance Marketplaces,” May 2014; eHealth, “Health Insurance Price Index Report for Open Enrollment and Q1 2014,” May 2014; HHS Summary Report, May 2014; The Advisory Board Company.

$3,000-$5,99930%

54 | @chasedave

A NEW KIND OF PATIENT IS IN THE WAITING ROOM

> Millennials are beginning to utilize the healthcare system more regularly, with significant consequences for industry stakeholders

0%

25%

50%

75%

100%

1995 1Q 2015

Post-Millennials

Millennials

Gen Xers

Boomers

Silents

Greatest

31% SILENTS

2% GREATEST

49% BOOMERS

18% GEN XERS 34% MILLENNIALS

1% POST-MILLENIALS

34% GEN XERS

29% BOOMERS

2% SILENTS

Source: Pew Research Center.

55 | @chasedave

> Various tools are being created with the goal of improving care navigation and transparency, and empowering and educating the patient-consumer

ENTREPRENEURS ARE RESPONDING

How exactly does my insurance

work?

How much should I be paying?

How do I know who the best doctor is?

My doctor’s hours don’t match my hours.

Can someone explain my condition to me

in normal words?Does my doctor think about me after I leave the office?

56 | @chasedave

0

10

20

30

40

50

60

0

10

20

30

40

50

60

0

10

20

30

40

50

60

TOOLS AIMED AT FIXING PRICE FAILURES ARE EMPOWERING PATIENT-CONSUMERS

Tulsa, OK

$0.6mm 51%

Seattle, WA

$1.1mm 46%

Rockford, IL

$1.0mm 50%

Savi

ngs (

$K)

Total $ Savings Average % Savings

Source: The Zero Card. Representative of procedures completed in 2012-2014; Tusla (n=134), Seattle (n=301), Rockford (n=170).

57 | @chasedave

TOTAL – Big 6

Sites,Market Share 901 50% 457 24% 140 8% 103 6% 80 4% 30 2% 1,711 93%

Health System Affiliations 47 6 4 46 2 3 108

DECENTRALIZED MEDICINE AND PHYSICIAN EXTENDERS ARE THE NEW NORM

> The retail clinic market is highly concentrated and dominated by house-hold names

18% of PCP visits could be handled at retail clinics.> 10 million visits per year by Americans at retail clinics represents only 2% of all primary care encounters.

Annual ED Visits

Non-Urgent ED visits shifted to other care sites

132mm 47mmAnnual PCP

VisitsVisits Eligible for

NP-Led Care

573mm

103mm

Source: CDC/NCHS, “National Ambulatory Medical Care Survey, National Hospital Ambulatory Medical Care Survey.” 2009-2010; The Value Proposition of Retail Clinics, April 2015, RWJF; The Advisory Board Company.

58 | @chasedave

AND A NEW PRIMARY CARE MODEL IS IN THE MAKING> Concierge/DPC practices have grown dramatically since 2005 and offer numerous distinct advantages

Source: Wall Street Journal; Forbes; Oliver Wyman.

48%ER VISITS

2005 2015146

5,500

✚ Number of concierge practices is up 3,700% 80 / 100

COMMON DIAGNOSES COVERED

Why use the equivalent of auto insurance for an oil

change?

NET PROMOTER SCORES

93NPS

51NPS

05,00010,00015,00020,00025,00030,00035,000

0.0

0.5

1.0

1.5

2.0

2.5

Patie

nts

Tran

sact

ion

Vol

ume

($m

m)

Monthly Transaction Volume ($) Patients

41%HOSPITALIZATIONS

25%OUTPATIENTUTILIZATION

59 | @chasedave

While some practices are working with insurers on bundled products for the individual market, in the near future, a national health insurer will team with a national player in primary care, such as Walgreen’s, to offer DPC at scale to consumers via a gym-like monthly membership fee, taking DPC from a niche offering to a new model consumers begin to understand.

TRADITIONAL INSURERS ARE BEGINNING TO EMBRACE DPC, AND OTHERS ARE DRIVING CHANGE

United Food and Commercial Workers UnionUnitedHERE, Atlantic City

Freelancer’s Union, BrooklynCulinary Workers Union, Las Vegas

2012 2013 2014 2015

UNIONS COMPANIES


60 | @chasedave

ON-DEMAND IS MAKING ITS WAY TO HEALTHCARE

Heal Pager Medicast Retrace Health

FOUNDED 2014 2014 2013 2013 2014

FEE/SERVICE$99

On site doctor in 1 hour

$200 for urgent care$75-100 for wellness NA $50: NP video consult

$200: in-person $150

REGION Los AngelesSan Francisco

NYCSan Francisco NA Minneapolis Atlanta

TARGET CUSTOMER Adults & Kids Adults & Kids Health Systems Adults & Kids Pediatric Care

61 | @chasedave

FINANCES DOCUMENTS

ACTIVITY SOCIAL=

CONSUMERS ARE BRINGING THEIR LIVES TO THE INTERNET AT A RAPID PACE

62 | @chasedave

AND HEALTHCARE IS NEXT mHealth apps are set to become a regular part of care

86%of clinicians believe mHealthapps will be important for patient health management over next 5 years

90%Use mobile devices to engage patients

app-enabled patient portals

telehealth services

text communicationsremote patient monitoring

73% 62%

57% 49%

7 in 10 U.S. adults track at leastone health indicator

And the means of tracking are remarkably primitive

49%IN HEAD

34%PAPER

8% MEDICAL DEVICE

7%APP

5%SPREADSHEET

1% ONLINE TOOL

Source: Pew Self-Tracking, June 2013; Pew Internet & American Life, January 2014; 2013 Accenture Consumer Electronics Products and Services Usage Report; MedData Group, April 2014; HIMSS 2015 Mobile Technology Survey.

63 | @chasedave

THE PATIENT WILL BE AT THE CENTER OF THE FUTURE HEALTHCARE SYSTEM

FUTURE FOCI:

Primary Physician

Consulting Physician

LabInsurance

Pharmacy

Non-Clinical Activity

Family

Hospital

Post-Acute and Home Care

Ancillary Sites

Personalized treatment

1Controls method and

venue of care delivery

2Shops for quality

and cost

3

64 | @chasedave

CARE EPISODE REIMBURSEMENTTraditional Foci

1. Diagnostics

2. Technology

3. Drugs

4. Beds

5. Procedures

PROVIDERS ARE ALTERING THEIR GOALS TO REFLECT THIS NEW FOCUS

LONG-TERM HEALTH MANAGEMENTPatient-Centricity

1. Multi-provider patient portal/tools

2. Medical information is made relevant

3. Patient-generated data is sought out

4. Portable and on the patient’s terms

5. Collaborative care process with shared decision making tools


65 | @chasedave

INDUSTRY STAKEHOLDERS MUST EMBRACE PATIENT ENGAGEMENT

Those with Significant Investments in Patient Engagement and Relationship Management Solutions

Patient relationship management and engagement work

And industry players are responding

LESS ACTIVATED MORE ACTIVATED

30-Day Readmissions

Medical Errors

Poor Communication Health Consequence

28%

13%36%

19%

49% 13%

Greater Patient Engagement = Improved Outcomes

Source: AARP survey of patients over 50 with 2 or more chronic conditions.

66 | @chasedave

PAYERS WERE FIRST TO DO SO WITH MIXED RESULTS

Health Matters

GOLDWALKERCOLORFALL

67 | @chasedave

> Vendors providing frictionless and secure integration with consumer health data, leading to actionable clinical data will win with providers

4EHR integration is a must; seek interoperability opportunities

1Analytics are as important as

data collection and warehousing

5 Build partnerships with payers to provide health and wellness incentives for patients

2User must be empowered

via actionable clinical insights

6Easy identification of high-risk patients

3 The simpler the better

AND PROVIDERS HAVE MUCH TO LEARN FROM THEIR EFFORTS

68 | @chasedave

CareMore: A PROVIDER EMBRACING A PATIENT-CENTRIC MODEL

1Early intervention is central to their model. Longitudinal records (8-10 sources) and predictive modeling allow for

early intervention to prevent acute episodes.

2 “A high percentage of physician services can be

delivered by non-physicians.”

3 A patient can go from being in the easy chair to ICU in

12 hours so they must rapidly intervene. speedy delivery within minutes can save.

4Capitation is freedom, not risk. Education is what the

patient needs, and longitudinal.

Key Takeaways from CareMore Business and Care Management Model

> Age- and health-adjusted payment for its full patient panel> Patient-first business design required total rethink of patient

relationship, health model, and care team> Physician hospitalists include treatment of patients outside

hospital

> Each chronic condition has its own holistic treatment plan> Information is rapidly processed and forwarded to all

members of care team

A Medicare healthcare company based in Southern California providing care to an exclusively Medicare Advantage population Acquired by Wellpoint in 2011 for $800 million

Source: Oliver Wyman.

70 | @chasedave

PATIENT-CENTRIC CARE INNOVATORS

HEALTH INFORMATION, TRANSPARENCY, AND PLAN INFORMATION

PATIENT RELATIONSHIP MANAGEMENT AND ENGAGEMENT/REMOTE PATIENT MONITORING

71 | @chasedave

PATIENT-CENTRIC CARE INNOVATORSCONSUMER-FRONTING PAYER PRODUCTS THAT HELP MANAGE BENEFITS AND PAYMENT

CARE ACCESS/RETAIL CLINICS/DIRECT PRIMARY CARE/HOUSE CALLS/CARE ANYWHERE

72 | @chasedave

NOTABLE RECENT FINANCINGSPRIVATE PLACEMENTS

2013

ENGAGEMENT INFORMATION CARE ACCESS

$10mm $8mm $68mm $40mm $24mm $15mm

$6mm $15mm $10mm $14mm $14mm

2014


$82mm $26mm

$110mm $17mm $11mm

$81mm $50mm $32mm

$25mm $15mm $27mm $24mm $21mm

2015


$500mm $20mm

$178mm $130mm $20mm $63mm $50mm $28mm

$35mm $13mm $13mm $20mm $16mm $15mm

$16mm s

73 | @chasedave

$91mm $178mm $100mmCARE ACCESS INFORMATION INFORMATION

JAN. 2014 MARCH 2014 MARCH 2014


IPOs

74 | @chasedave

WELLNESS & PREVENTION

75 | @chasedave

1. The era of open information in healthcare is underway

2. Wearables show promise, but not perfected

3. The life science industry’s “transistor moment” has the potential to revolutionize medicine

4. Large pharma can’t resist for long

5. America’s growing culture of wellness is beginning to penetrate the workplace, but are the results real?

6. The race to build a healthcare data platform is on

WELLNESS & PREVENTION OVERVIEW

76 | @chasedave

PAYERS

CLAIMS COSTS/FINANCE UTILIZATION EMR

PROCEDURES OUTCOMES

PRESCRIPTIONS

SUPPLY CHAIN

• Coordinated care• Improved outcomes• Interoperability• Population health

• Lower costs• Disease prevention• Adherence

SATISFACTION

THE ERA OF OPEN INFORMATION IN HEALTHCARE IS UNDERWAY

TRIAL RESULTS AND EFFICACY SALES AND DRUG HISTORY

• R&D productivity• Trial improvement

• Improving efficacy• Care access• Price transparency

• Convenience and cost• Good health

EXERCISE DATA PURCHASES BEHAVIORS, SOCIAL

DAT

A

PROVIDERS

GO

ALS

PATIENTS

DAT

AG

OAL

S

PHARMA

DATA

GO

ALSD

ATAG

OALS

CLAIMS COSTS

• Payment innovation• Data acquisition• Provider-performance

transparency

• Lowering costs• Reducing claims paid• Winning share• Wellness & prevention

77 | @chasedave

WEARABLES SHOW PROMISE

65%WEIGHT

61%BLOOD SUGAR

57%BLOOD

PRESSURE

54%EXERCISE

36%NUTRITION

36%PAIN

35%SLEEP

2012 2013 2014E 2015E 2016E 2017E 2018E 2019E

EXPENSE

PRIVACY

LOOK

COMFORT

HEALTH RISK

Leading barriers to purchase cited by U.S. consumers

Source: IMS Research, MeMD, ABI Research, Deloitte, Rackspace; TNS Global, October 2013.

> 88% of physicians want patients to monitor health parameters at home. Their top priorities include:

While wearable technology in healthcare is expected to triple in size by 2019, there are major consumer impediments to purchase.

> Fitness and medical wearables were 60% of the wearables market in 2013

10%

13%

13%

31%

54%

$2.0bn$2.7bn

100m units $5.8bn

78 | @chasedave

> Declining rate of sustained activity tracker use over ownership

BUT COULD BE A FAD AND ARE TARGETING THE WRONG POPULATION

0%

25%

50%

75%

100%

0 3 6 9 12 15 18 21 24

Rate

of S

usta

ined

U

tiliza

tion

Time (months)

Daily engagement falls below 50% within 18 months of purchase

0%

10%

20%

30%

18-24 25-34 35-44 45-54 55-64 65+% of activity tracker owners % of U.S. population

Americans own a wearable1 in 5 1 in 10 Wear it

daily

> Activity tracker ownership age demographic

Ages 25-34 Goal: Fitness Optimization

Ages 55-64 Goal: Overall health improvement and longevity

Source: Endeavour Partners, September 2013; PwC.

79 | @chasedave

86%wearables would make users

vulnerable to security breaches

82%feared wearables would

invade their privacy

72%wearables would hurt

our ability to relate to each other

CONSUMER AND DOCTOR SENTIMENT ON WEARABLES IS MIXED

46%employer should fund wearable

technology for employees

72%would use a smartwatch

if employer paid

63%would use a fitness band

if employer paid

> “Doctors would love to be excited about wearables — they’re gadget guys at heart — but theirday-to-day is spent battling 30 year old fax machines to get your last lab report.”

- Jeff Tangney, CEO of Doximity

Source: PricewaterhouseCoopers.

> “We can't make the leap that just because the data from these low-risk devices is coming indigitally doesn't mean that it's accurate.”

- Dr. Michael Blum, UCSF

80 | @chasedave

Rapidly declining cost of sequencing the human genome

THE LIFE SCIENCE INDUSTRY’S “TRANSISTOR MOMENT”

Allows previously unthinkable questions to be answered

What is my unique physiology?

What can I metabolize?

What drugs would not interact well for me?

What is the best dosage for me?

What is unique about my cancer?

What is my pre-disposition to disease?

2009

$100k2015

$1k

Source: PricewaterhouseCoopers.

81 | @chasedave

HAS THE POTENTIAL TO REVOLUTIONIZE MEDICINE

TRADITIONAL MEDICINEOne size does not fit all

PERSONALIZED MEDICINE:The application of genomics, pharmacogenomics,

and proteomics for improved efficacy

HIGH FAILURE RATES LOW FAILURE

Source: Brian Spear, Margo Heath-Chiozzi, Jeffrey Hugg, “Clinical Trends in Molecular Medicine”.

BIOMARKER DIAGNOSTICS(Blood, DNA, Tissue)

THERAPY

SSRIS 38%ASTHMA 40%DIABETES 43%

ARTHRITIS 50%ALZHEIMER’S 70%CANCER 75%

TARGETED THERAPY

82 | @chasedave

LARGE PHARMA CAN’T RESIST FOR LONG

3 Include diagnostics in development,

trial design, and treatment

Payers are beginning to recognize the real and increasing cost of administering ineffective drugs and treating side effects, and pharma must respond or face a frustrating future of declining sales and profits

1Forge alliances with

diagnostic companies

2 Communicate safety and efficacy advantages of targeted therapies

BLOCKBUSTER TARGETED

Mass Phenotype Targeted GenotypeMarkets

Disease State Disease Life CycleFocus

1 Drug – 1 Disease State Numerous StatesTreatments/Drugs

Scale KnowledgeEconomics

Large Runs Small RunsManufacturing

Few, Large Multiple, SmallSales Force

Few ManyProduct Portfolio

BUSINESS MODEL TRANSITION

Source: The Changing Face of R&D in the Future Pharmaceutical Landscape, Deloitte.

83 | @chasedave

0

2,000

4,000

6,000

8,000

10,000

1996 2000 2004 2008 2012 2013

AMERICA’S GROWING CULTURE OF WELLNESSO

rgan

ic Fa

rms

2002

2012

7,323

17,281

266%Organic market sales growth

(2002-2011), totaling $31.5 billion in 2011

# of farmers markets per USDA

78% of families

buy organic

THE TASTES OF A NEW GENERATION...

When asked if they will increase or decrease their spending in 50 different categories over the next 12 months, the proportion of millennials answered:

1FRESH FRUITS AND VEGETABLES

⬆37%

And the organic movement is showing rapid growth

3xgrowth in farmers markets

2ORGANIC FOOD

⬆25%

3NATURAL PRODUCTS

⬆23%

Source: Boston Consulting Group 2013 Global Consumer Sentiment Survey of U.S. Millennials’ Saving and Spending Intentions; USDA; Organic Trade Association.

84 | @chasedave

WELLNESS IS BEGINNING TO PENETRATE THE WORKPLACE

WHAT THEY OFFER

BIOMETRIC TESTING

HEALTH RISK ASSESSMENT

SUBSIDIZED GYM MEMBERSHIPS

FREE FLU SHOTSWEIGHT LOSS GROUPS

SMOKING CESSATION PROGRAMS LIFESTYLE

COACHING

24-HOUR NURSE LINE

HEALTH FAIRSPHYSICAL ACTIVITY

PROGRAMS

Source: Fidelity Investments and National Business Group on Health.

And spending more per employee on wellness incentives

201520142010

$430$595

$693

of U.S. employers with >50 employees offer wellness programs

50%

85 | @chasedave

BUT ARE THE RESULTS REAL?

PEPSICO

> Employee engagement is questionable

24% actually participate in

employer wellness programs

...to whoever shows wellness works.-Al Lewis & Vik Khanna

Insurance Thought Leadership.com

Source: RAND Group; HBR.org; Gallup.

> For every $1 spent on wellness, these studies showed healthcare savings of:

J&J DISEASE MANAGEMENT LIFESTYLE MANAGEMENT TOTAL MILANI/LAVIE

$2.71$3.80

$0.50$1.50

$6.00

12% strongly agree they have higher overall well-being

because of employer

> Prompting the “Wellness Prize”

$1 MILLION

86 | @chasedave

THE RACE TO BUILD A HEALTHCARE DATA PLATFORM IS ON

ACQUISITIONSINVESTMENTSPLATFORMSPARTNERSHIPS

INN

OV

ATO

RS

34 Total Healthcare Investments

88 | @chasedave

PHYSICAL FITNESS DIET & NUTRITION

VITAL SIGN MONITORING & WEARABLE TECH WELLNESS & PREVENTION PROGRAMS

WELLNESS & PREVENTION INNOVATORS

89 | @chasedave

SOCIAL ENGAGEMENT, NETWORKS, COACHING MEDICATION MANAGEMENT AND ADHERENCE

GENOMICS/PRECISION MEDICINE BEHAVIORAL AND EMOTIONAL HEALTH

WELLNESS & PREVENTION INNOVATORS

90 | @chasedave

2013

PRECISION/GENOMICS BEHAVIORIAL HEALTH WEARABLES WELLNESS

$40mm

$30mm $239mm $43mm $63mm $21mm

$12mm $35mm $30mm $19mm $18mm

2014


$480mm $120mm

$40mm

$147mm $204mm $29mm$70mm $62mm

$32mm $23mm $19mm$60mm $58mm

2015


$200mm $100mm

$50mm

$300mm $92mm $58mm

$100mm $79mm $35mm $48mm $30mm

$30mm$55mm $50mm $19mm$23mm

NOTABLE RECENT FINANCINGSPRIVATE PLACEMENTS

91 | @chasedave

$102mm $732mmGENOMICS WEARABLES

FEB. 2015 JUNE 2015


IPOs

OVERVIEW OF CASCADIA CAPITAL

93 | @chasedave

Leading diversified investment bank> M&A, private placements, advisory services> Specialized in-depth expertise across 10 industry verticals

Founded in 1999, Cascadia has a successful 16 year history> Successfully completed over 190 transactions with $5.6 billion in

transaction value> Representing clients in the U.S. and globally, including Europe, Asia and

Australia

Experienced team with successful track record> Wall Street training and experience > Decades of investment banking and operational expertise> Deep capital markets expertise

Coordinated delivery of appropriate expertise across the firm> 40 investment banking professionals> 11 Managing Directors in six cities

> Headquartered in Seattle, with Managing Directors in Houston, Los Angeles, Minneapolis, New York and Spokane

OUR FIRM

94 | @chasedave

PROVIDING A FULL SUITE OF BANKING SERVICES

MERGERS & ACQUISITIONS

We have completed M&A transactions ranging in size from $20-$500 million. Our thorough and disciplined process, in combination with our deep industry expertise, has resulted in a proven track record of delivering successful outcomes for our clients.

ENGAGEMENTS INCLUDE:• Sell Side Representation• Buy Side Representation

CORPORATE FINANCE

We have extensive experience placing equity and debt capital ranging from $10-$250 million. We leverage our deep relationships with institutional investors; including private equity, growth equity, venture capital, family office, mezzanine and venture debt, hedge funds and BDCs.

ENGAGEMENTS INCLUDE:• Private Equity Capital Raises• Public Company Capital Raises• Recapitalizations

STRATEGIC ADVISORY SERVICES

We provide our clients with analytical data and insights to facilitate strategic decision-making. We advise our clients on how to maximize shareholder value and then provide support for transaction implementation.

ENGAGEMENTS INCLUDE:• Corporate Valuations• Fairness Opinions• Shareholder Rights Planning

PRIVATE CAPITAL

We listen carefully to business owners and managers and then work closely with them to custom design long-term and flexible capital solutions. Our approach resonates particularly well with family-owned and closely-held companies.

ENGAGEMENTS INCLUDE:• Acquisition/Organic Growth Capital• Corporate Divestitures• Management Buyouts• Minority Stakes

• Debt Financings & Restructurings• Project Finance

• Shareholder Value Analysis• Strategic Partnerships & Joint Ventures

• Partial Liquidity Events• Recapitalizations• Special Situations

• Management Buyouts• Leveraged Buyouts

95 | @chasedave

PROVEN RESULTSMOST RECENT TRANSACTIONS

96 | @chasedave

PROCESS AND EXPERIENCE DELIVER RESULTS

Cascadia is a Highly Active Diversified Investment Bank

• Record-breaking 2014, having closed 26 transactions with over $1.3 billion in value

• Over $4.0 billion in total M&A transactions closed in the firm’s history

• Over $1.6 billion in total capital raised in the firm’s history

Team Members Have Deep Industry Expertise

• With bankers in ten different industry verticals, we have the experience to offer industry breadth while maintaining sector depth

• Dedicated resource model with comprehensive vertical expertise from Managing Director to Analyst

We Differentiate Each Process With a Customized Approach

• We are thoughtful advisors who deliver a tailored process to suit the needs of our clients

• We understand the strategies of the counterparties, enabling us to tell them why they should be interested – allowing Cascadia to drive the transaction and maximize results

Our Experience and Approach Drive Results

• We have experience, industry focus and a differentiated process that drives success

• Our transactions are built upon delivering the best quantitative and qualitative terms with the most desirable counterparty

97 | @chasedave

OVER $4 BILLION IN M&A TRANSACTIONSMOST RECENT TRANSACTIONS

98 | @chasedave

OVER $1.6 BILLION OF CAPITAL RAISED MOST RECENT TRANSACTIONS

99 | @chasedave

CASCADIA CAPITAL LEADERSHIP TEAM

• Leading diversified investment bank advisory firm serving domestic and global clientele

• Coordinated delivery of appropriate expertise across the firm• Strategic insight to assist in identifying and

executing a range of alternatives• 11 Managing Directors in six cities• 40 investment banking professionals• Over $5.6 billion in transactional value

Cascadia has a distinguished team of investment banking professionals with expertise in a multitude of industries and capital markets.

100 | @chasedave

HEALTHCARE & DIGITAL HEALTH

Auto Aftermarket

Business Services

Consumer & Retail

Energy & Applied Technology

Financial Services

Food & Agribusiness

Healthcare & Digital Health

Industrials

Real Estate

Technology

PRINCIPAL SECTOR FOCUS

Consumer Driven Health IT & Mobile Health Aging Population

Workflow Solutions Healthcare Services

Insurance & Reimbursements Data Access & Communication

OVERVIEWWe have four professionals with over 40 years of collective experience who have originated and executed over $1 billion of M&A and financing transactions in the Healthcare sector. Emerging trends in the industry are driven by consumers demanding higher quality care with cost transparency, integrated health information, and better provider access and communication. The solutions lie at the intersection of healthcare and technology, where innovation provides for better, more accessible care at lower costs. Cascadia’s team is perfectly primed to meet the growing needs of the industry’s players, leveraging vast experience coupled with a thorough understanding of the market.

REPRESENTATIVE TRANSACTIONS

101 | @chasedave

OUR HEALTHCARE EXPERIENCE & EXPERTISE

APPROACH TO HEALTHCARE

• Healthcare information technology• Full spectrum: pre-, point-of, post-care• Healthcare services

RELEVANT, DEEP EXPERTISE

• Originated / executed over $1 billion of M&A and financing transactions in the healthcare sector

• Regular dialog with key industry players regarding “live” transactions• Unprecedented financial sponsor relationships

SELECTED CASCADIA HEALTHCARE & DIGITAL HEALTH TRANSACTIONS

102 | @chasedave

THE HEALTHCARE & DIGITAL HEALTH TEAM

P R O F E S S I O N A L F O C U S P R I O R E X P . E D U C A T I O N

Kevin CableManaging [email protected](206) 696 - 7922

Healthcare & Digital Health

• Board Member (e.g., Innovate Washington, Technology Alliance, Washington Software Alliance)

• CEO, Numera Software• VP Corp. Dev., Molecular Simulations

BS, Cell & Molecular Biology, University of Washington

Dave ChaseSenior Advisor Healthcare & Digital Health

• Managing Partner, Healthfundr• Advisory Board, Oliver Wyman Health Innovation Center• Co-Author, 2014 Healthcare Book of the Year• Contributing Writer, TechCrunch, Forbes• SVP, WebMD• CEO, Co-Founder, Avado

BA, Business & Mathematics, University of WashingtonExecutive Education, Northwestern University

Jerome KimSenior [email protected](206) 436 – 2542

Healthcare & Digital Health• Business Analysis Manager, Starbucks • Sr. Associate, BMO Capital Markets• Analyst, Salomon Smith Barney

MBA, Corporate Finance, Columbia Business SchoolBA, Economics & Spanish, Willamette College

Novan [email protected](206) 436 – 2510

Healthcare & Digital Health • Analyst, FT Partners• Corporate Development, Quanex

BA, Finance, University of Washington

103 | @chasedave

SCI SOLUTIONS ACQUISITION OF CLARITY HEALTH

OVERVIEW – GROWING SAAS HEALTHCARE CARE COORDINATION SOFTWARE PLATFORM

SITUATION – KEY ACQUISITION TO ACCELERATE GROWTH

• SCI was in a process to acquire Clarity Health, a referral management, payer rules-engine and insurance processing software platform for hospitals, imaging centers and physician offices. The acquisition would create one of the largest referral management and care coordination software firms, serving more than 10,000 physician practices and 700 hospitals, health systems and imaging centers in 275 geographic markets across the United States.

• SCI was seeking to refinance its existing senior debt which had been in place since its acquisition by Wicks / NEA• SCI engaged Cascadia based on its experience in the digital health space and its debt placement capabilities

CASCADIA PROCESS – EFFICIENT, COMPETITIVE DEBT PLACEMENT

• SCI builds, implements, and operates healthcare business process software for a national network of hospitals, diagnostic imaging centers, physician groups, and post-acute care organizations

• It has the most widely adopted cloud workflow platform for referrals, orders, messaging, patient scheduling, revenue-cycle management and provider/consumer self-services

• Ownership includes private equity firms The Wicks Group, New Enterprise Associates, and management

• Cascadia’s Debt Group ran a targeted process focused on a group of technology-centric lenders including banks and non-bank capital sources for an enterprise-value based loan package

• Within weeks, Cascadia’s process generated several term sheets, giving SCI transparency to market pricing and terms

• Lender diligence was run concurrent with SCI’s buyer diligence, and several lenders received credit committee approval to proceed with the deal

• Orix Ventures, the technology lending division of Orix Corporation, provided a competitive financing package with terms superior to SCI’s current credit facility, as part of a new capital structure better aligned with SCI’s growth strategy

104 | @chasedave

INTEGRA GROUP’S ACQUISITION BY JM SMITH CORPORATION

• Transaction Completed: August 2015• Transaction Amount :Undisclosed

• Transaction Summary: Integra Group was acquired by JM Smith Corporation. Further details of the transaction were not disclosed.• Cascadia Capital Role: Exclusive financial advisor to Integra.

• Opportunity to broaden JM Smith’s current offering through complementary software systems• Once integrated with JM Smith, Integra will lead the long-term care business channel of the combined company and facilitate the

development of a portfolio of new products and services

• The acquisition will position the combined company as a leading provider of products and services to the institutional pharmacy market

• A supplier of services and technology to pharmacies, institutions, local government agencies, and businesses across America

• Selected prior investments/ acquisitions: RxMedic Systems and CornerDrugstore.com

TRANSACTION OVERVIEW

STRATEGIC RATIONALE

JM SMITH CORP.

• Integra designs and develops innovative software systems for the institutional pharmacy marketplace

• Provides internet access, website hosting and design, shopping carts and databases through four core modules

INTEGRA GROUP

105 | @chasedave

• By consolidating a fragmented urgent care market in the Pacific Northwest and undertaking a joint venture with a strategic partner in the Northeast, GoHealth is well-positioned to become a national leader in the urgent care market. Strategic advantages include:• Opportunity for widespread consolidation in a hyper-fragmented market• Pipeline of joint ventures to establish a nationwide presence• Strong management team of tenured healthcare industry professionals

• Capital raised will be used to acquire standalone urgent care clinics while undertaking the construction of de novo clinics across the Northeast

• Multi-sector focused private equity and venture capital fund based in Forth Worth, TX

• Selected Investments: Avaya, Chesapeake Energy, Domo

GOHEALTH’S EQUITY FINANCING

TPG CAPITAL

• GoHealth develops and operates leading networks of outpatient urgent care facilities throughout the Pacific Northwest and nationally

• GoHealth provides patients with expanded access to affordable, high-quality, patient-centric care in convenient locations

GOHEALTH

• Transaction Completed: March 2014• Capital Raised: $30,450,000

• Transaction Summary: GoHealth announced a growth equity investment by TPG Capital. Further terms of the investment were not disclosed.

• Cascadia Capital Role: Exclusive financial advisor to GoHealth


STRATEGIC RATIONALE

106 | @chasedave

• With over 50% year-over-year growth, Clinicient has a significant opportunity to become the leading software and services provider to healthcare rehab clinics:• Compelling business model• Strong barriers to entry• Limited competition, only one other dedicated opponent in the market• Only solution that provides a fully integrated end-to-end platform

• Capital raised will be used to complete technology investments in the platform and invest in the sales and marketing function

• Technology-enabled services growth equity fund located in New York, NY• Selected Investments: Mindbody, Ascentis, MediaMath

CLINICIENT’S $15 MILLION EQUITY FINANCING

CATALYST INVESTORS

• Based in Portland, Oregon, Clinicient is a provider of integrated revenue cycle management software and services for outpatient rehabilitation clinics

• Clinicient provides rehab clinics with the software and services to effectively manage their practices and increase the efficiency of the claims reimbursement process

CLINICIENT

• Announcement Date: March 4, 2014• Capital Raised: $15 million in equity capital

• Transaction Summary: Clinicient announced a $15 million Series C investment by Catalyst Investors. Further terms of the investment were not disclosed.

• Cascadia Capital Role: Exclusive financial advisor to Clinicient


STRATEGIC RATIONALE

the future health ecosystem today - cascadia capital · 2019-01-22 · big data patient engagement...

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