MORE OF WHAT MATTERS Update: UnitedHealthcare Pharmacy Benefit Transition February 26, 2013
Success matters It s time for a better plan. At UnitedHealthcare, we give you more of what matters: MORE ACCOUNTABILITY MORE HEALTH IMPROVEMENT MORE ENGAGEMENT 2 Proprietary information of UnitedHealth Group. Do not distribute or reproduce without express permission of UnitedHealth Group.
Today s Agenda 1 2 Streamlining Our Resources Aligning resources to meet your needs Wave 1 Migration Update Overview of Wave 1 results and next steps 3 Differentiate Deliver new market potential to address emerging industry trends 3
Streamlining How We Go To Market
The United Family of Companies UnitedHealth Group is consolidating pharmacy benefit services to better meet customers needs now and in the future. UnitedHealth Group OptumRx Year End 2013 (estimated) Health Benefits Health Services Pharmacy Lives 28M Pharmacy Spend >$32B Prescriptions 500M 39M Lives Almost 60M Lives UnitedHealthcare UnitedHealthcare Pharmacy Pharmacy 5 5
OptumRx Positioned Well to Serve Your Clients 28 million lives Year end 2013 (estimated) A part of Optum, which supports 1 in 5 Americans Employer Payer Medicaid Medicare Started in 1989 as a part of a major healthcare system. Now the nation s 3 rd largest PBM serving the largest Medicare population 96% 98% 100% member satisfaction first call resolution real-time audit process 26% 52% 11% 11% Assumes migration of 12M UHC commercial lives in 2013. 6
Streamlining Our Business Dirk McMahon CEO Bruce Mead Client Development Client Management Client Service & Implementation Client Effectiveness Clinical Engagement Consultant & Collaborative Relations Marketing John Drakulich Paul Kiser Wayne Miller Patrick Stroh Mary Jenkins Jane Lutz Rick Swartz One face to the market for all business: Pharmacy Only to Fully Synchronized 7
Serving 2 Markets 1 RFP Process Markets We Serve Employer Commercial Public Sector/UMR Labor and Trust Payer Health Plans TPA PBMs Welcome Kathy Hohner Where to send your RFP Vice President for Pharmacy Proposal Services and Strategy Proven Sales & Account Management executive with 17 years of success, including: OptumRx Central Region Vice President CVS/Caremark Vice President Strategic Proposals 1 OR 2 Submit to the OptumRx proposal inbox at pharmacyproposalservices_inbox@optum.com Work with the sales person in the associated market/region 8
Offering a Full Spectrum of Pharmacy Solutions Pharmacy Only Fully Synchronized Driving to lowest pharmacy costs Cross-carrier solution Ability to synchronize Optum capabilities Core Value Total Cost Management Leading Member & Client Experience Clinical Care Coordination Driving to better health and lowest total cost Fully synchronized benefits One platform One member experience One client experience We ll work with you to design the right total health care and cost solution for your clients. 9
UnitedHealthcare Migration to OptumRx
Reminder: What Clients Can Expect Essential elements will remain the same and will not require any client action; we will simply transition information in to our new system: No Changes to Your Benefit Benefit Plan Designs Prescription Drug Lists (PDLs) Retail Experience (same level of access) Clinical Programs Specialty Pharmacy Services Account Management Teams Contract Terms Services transitioning to OptumRx: Claims processing Mail service pharmacy (open mail service refills will be transferred to OptumRx) Select aspects of member service, including mail service call center and pharmacy website support The value-defining aspects of our customers pharmacy programs and member support, have been, and will continue to be managed by UnitedHealth Group. 11
Pharmacy Benefits Staged Transition Membership 1 1/1/2013 UnitedHealth Group employees and select clients 390 K 4/1/2013 West region and Northeast region 1.9 M 6/1/2013 Central region 2.7 M 7/1/2013 National Account clients across all regions 2.2 M 9/1/2013 Southeast region 1.2 M 10/1/2013 Other acquired entities 2.5 M 1 Projected estimated membership migrating by wave. 12 12
Our Testing Results: Wave 1 We are well prepared for a smooth transition, as evidenced by our testing and quality validation results. Business Function Testing End-to-End Testing Client Readiness Testing Third-Party Validation Technology and processes tested individually for desired function result. Technology and processes tested in sequence to confirm that systems align. Client-specific claims samples for three months of activity re-adjudicated. Claim samples are quality reviewed by independent third party auditor. 99% accuracy 99% accuracy Wave 1 Results 99.5% accuracy 99.63% accuracy 13
Migration Update: Wave 1 Successful Start Members are getting their prescriptions, claims are being paid and service levels are strong. Benefit set up >99.8% accuracy Claims paid Over 300,000 scripts Call center activity 12% below projected call volume Average speed to answer: 11 seconds * All statistics are as of 1/31/2013 for business migrating to OptumRx for wave 1 on January 1, 2013. Operations Portal Migration Command Center Client Service Migration Command Center Member Communications Member Services Network Meets daily to assess, assign, track, immediately engage and resolve issues. 14
Keeping You and Your Clients Informed We will keep you and your customers informed throughout the migration. Online Resources In addition, prior to each wave, customers will receive confirmation of their migration date. Customer Confirmation Customers will receive transitionrelated information, employer newsletter copy, final member communications Continued Updates Continued communications and account team meetings Transition Resource Full details, communication samples uhctogether.com/rxaprila 55 Days Out (M-55) (Migration minus 55 days) Migration date (M) Pharmacy InFocus Newsletter Migration updates and ongoing news ConsultantPharmacyInFocus.com 15
Reminder: Member Migration Communications Call Centers are trained to support members throughout the transition Point of Sale Messaging will help members at the retail counter Communications Employer templates Will be provided for additional communication to employees (Newsletter, FAQ) (M-90) Member mailing w/faq (M-35) 35 Days Out (M-35) (Migration minus 35 days) Online transition messaging (M-30) New ID cards mailing (M-20) Online pharmacy tour (M) Migration date (M) Data Files Member Profile Set Up starts prep for communications and call center (~M-90) Customer Implementation Benefit information, PDL, plan design, programs, etc. (~M-50 to 60) Member Data Transfer Files Open refills, accumulators, Rx activity and history, prior authorizations (initial load and frequent updates) 16
Differentiate: Our Unique Value
Problem: Complexity costs money and compromises health 96% of U.S. consumers fail to ask questions about how to use their medications Consumers DON T KNOW they re at risk and DON T UNDERSTAND their treatment. $20 100 billion lost annually in the U.S. to improper medication use due to lack of knowledge Clinical Pharmacists, Specialty Care Coordinators Health Coaches, Behavioral Specialists Customer Service Advocates Dietitians, Nutritionists Physicians, Nurse Case Managers We collectively manage over 100 million touchpoints per month Mail Service & Rx Customer Service Care Mgmt., Behavioral & Wellness Specialty Rx Clinical Management Medical Plan Customer Service 18 A Call to Action: Protecting U.S. Citizens from Inappropriate Medication Use. Institute for Safe Medication Practices; 2007. http://www.ismp.org/pressroom/viewpoints/communitypharmacy.pdf. Accessed November 9, 2012.
Differentiate: Unique Value SYNCHRONIZATION Physicians Medical Data Nurses Behavioral Data Pharmacists Engaging Consumers to improve health Managing Total Cost to reduce spend Simplifying Experiences to increase value faster smarter simpler Behavioral Specialists Pharmacy Data Case Managers Lab Data Customer Service Advocates Working better together to drive lower total costs, improve health outcomes and simplify the consumer experience. 19
Specialty Pharmacy: Lowering Total Healthcare Costs TOTAL CARE COORDINATION LEADS TO BETTER OUTCOMES. Oncology (oral drugs) Pharmacy Benefit savings $1,939 Medical Benefit savings $15,441 Total Savings per user, 1st, year $17,380 Fewer emergency room visits Less hospitalization Pharmacy Benefit Savings Increased drug use ($2,348) Reduced waste $1,115 Network savings $928 Medical Benefit Savings Office visits $ 850 ER visits ($41) Outpatient hospital $11,852 Reduced drug waste Utilization Mgmt $2,244 Inpatient hospital $2,533 Other medical $247 $343,000 Average savings (10,000 life group). Typical savings for combined medical and pharmacy costs across 12 specialty conditions. 1. Specialty program outcomes based on UHC commercial membership 2007 to 2010. Network contract savings based on 2011 commercial FI membership. Utilization management savings based on a sample of 2011 commercial ASO membership. Individual plan results may vary.
Synchronization: One System One Team One consumer touch point through synchronized, enhanced service model We re creating a simplified experience for consumers. 21
Synchronization: Pharmacists Within The Care Team 1,700+ New Consumers Enrolled in Care Mgmt. Programs Comprehensive Medication Reviews (CMR) Early Results Early Phase Results 218 CMRs Conducted 175,000 Consumers / 11 Customers ~$600,000 Estimated Savings Annualized First Phase Averaging 6 opportunities identified per CMR One System One Team Real Results Post-CMR Review 72% of opportunities delivered immediate cost savings 28% of opportunities addressed clinical gaps 22
Vision: A Phased Approach We aren t a PBM building out care management strategies, we re a health care enterprise delivering best in class strategies together. Acceleration Early Phase (2012-2013) Innovation Initial Phase (2013-2014) Revolution Advanced Phase (2015 ) 23
The Next Phase in Healthcare SYNCHRONIZATION: Working better together. Simplify the consumer experience Improve health outcomes Drive lower total costs 24
Questions?