DOUBLE YOURAMBULATORY PLATFORM

Chris BishopCEO

OUTPATIENT EXPANSION

• 40% growth in urgent care centers over the last 2 years

• Will spend an additional $3 Billion on outpatient expansion this year

• Purchase of USPI

• Will spend an additional $100-150 Million annually on outpatient growth

• Outpatient now accounts for 28% of Tenet’s EBITDA vs. 5% in 2014

• Design new healthcare solution for 1.1 million employees in partnership with JP Morgan / Berkshire

• Innovator / Disrupter

Healthcare market is at a tipping point – Innovators are committing significant resources to outpatient growth

“Somebody else is going to do it to us if we don’t do it ourselves” – Trevor Fetter, CEO, Tenet Health

Source: WSJ, “Hospitals Invest in Outpatient Clinics,” Sept. 26, 2017

REGENT SURGICAL HEALTH

2001; Largest Private JV ASC OperatorFounded in

Led partners through major market evolutions: Development, Turnaround, Hospital/Physician Joint Ventures,

Hospital Ambulatory Strategy, HOPD Conversions

Among the first to:setting, develop OON strategies, develop centers for TJR,

implement bundled payments

bring new procedures to outpatient

Today’s focus:care with ambulatory surgery strategies

helping hospitals race toward value-based

ARE YOU MOVING TOWARDS

HOW FAST

VALUE-BASED CARE?

Value-Based Care

Total Joints Replacement

Bundled Payments

HOPD Conversions

Employed Physician

Ownership

Cardiovascular

Centers

• Shift to Value – IP ORs are considered cost center and targets for reduction by payors/risk bearing entities (ACO/CIN)

• Reimbursement Shifts – CMS approving new procedures for outpatient setting (by removing IP only designation) and narrowing gap b/w ASC and Hospital Rates. Move toward bundled payments and risk-based contracts.

• Outpatient Capabilities – Technology, smaller incisions, and advances in anesthesia and pain management techniques encourage more cases to go outpatient.

• Physician Preference – Better alignment of incentives with Physician Ownership. Physicians have better control and material financial returns.

• Patient Preference – Provides lower costs for those with high deductible plans. ASCs tend to be more convenient, less crowded, and less confusing than hospitals.

MOVING TOWARDS VALUE-BASED CARE

MAJOR HEALTH SYSTEMS

& PAYORS20 pledge to convert

OF BUSINESS75% to value-

2020

BY

According to chairman of the

taskforce, CEO Richard

Gilfillan, MD, of Trinity Health

based arrangements

PROJECTED GROWTH IN THE OUTPATIENT SPACE

SG2 Research projects by 2026, 51% of primary hip and knee joint replacements will be performed in an outpatient setting

EXAMPLE: 90 DAY TJR BUNDLE

DEVELOPING A BUNDLED PAYMENT STRATEGY

Site of Service Optimization

• Surgical Costs comprise 30% of every healthcare premium dollar spent

• ASCs Site of Service is consistent with Triple Aim Objectives – lower cost, higher quality, better patient experience

Physician Alignment is Critical to Success

• Effective management of a surgical episode requires heavy surgeon involvement

• Aligning incentives to engage physician’s will be critical to long-term success

CMSSelf-Insured

Employers

Commercial

Pilots around

TJR

BPCI

CJR

Lowes

PBG

Bridgehealth

Cigna

United

The Blues

WHO WILL PAY FOR THE BUNDLE?

Initial growth was slow, but some health systems and Physicians are beginning to see the advantages

STRATEGY DEVELOPMENT• Framework• Physician Alignment

5-YEAR PLAN• Target Markets• Ambulatory Toolbox

5-YEAR PLAN EXECUTION

• Capabilities & Speed to Market

1

2

3

HUB & SPOKE MODEL

STRATEGY

Managed Care

• Define current position

• Outline 5-year reimbursement strategy (FFS and Value Based Options)

Bundled Payments

ACO

Population Health

Assessing Physical Assets

• Physician alignment

• Employed vs. independent

• Service line development

DEVELOPING A PLAN

Target Markets

• Find an Expert(s)

• Turbo Charge Development

• Assessing Physical Assets

SPIDER WEB MODEL

DEVELOPING A PLAN

Target Markets

• Find an Expert(s)

• Turbo Charge Development

• Assessing Physical Assets

Ambulatory Toolbox

JV

De Novo

Acquisition

Standalone ASC

Ambulatory Campus

Urgent Care

Imaging

HOPDs

Outpatient ED

MOB

Cancer treatment

Dialysis

Telemedicine

Micro-hospital

Birthing Center

HOPD Conversion

HOPD TO ASC JOINT VENTURE CONVERSIONS

The key is to identify

incremental case volume

through strategic

physician alignment.

Mark Murphy, Sr. VP

St. Joseph’s Hospital

Syracuse, NY

• In support of a larger value-based care strategy

• Hospitals now support moving cases to ASCs as they

take on risk with new payer contracts

• In CON states, regulations to convert existing HOPD may

be easier than building de novo

• As a growth strategy – drive volume by partnering with

independent or “splitter” surgeons

• As a retention strategy – retain partnerships with key

surgeons looking to partner with a competitive health

system or develop their own

Diagnostic Procedures

•Angiography

•Noninvasive Diagnostic

Cardiology

•MRI

•Carotid Ultrasound

•Exercise Stress Testing

•Non-invasive vascular

imaging

Interventional Procedures

•Coronary Angioplasty

•Stenting

•Artherectomy

•Septal Closure

Devices

•Thrombectomy

•Peripheral angioplasty

•Carotid angioplasty

•Renal artery

angioplasty

•Venous angioplasty

Electrophysiology

•Pacemaker Placement

•Defibrillator (ICD)

Placement

•Implantable Loop

Recorder

•Cardioversion

•Cardiac Ablation

Other Vascular Procedures

•Varicose vein

ablations

•Venous access for

dialysis

CARDIOVASCULAR LAB PROCEDURES

EXECUTION

Expertise

Identify the expertise needed – and find an expert

Speed

JV Services you know you can’t execute quickly

Strategy

Develop and work from a 4 year strategy and plan

AMBULATORY ASSESSMENT

POTENTIAL ACQUISITION TARGETS

PHYSICIAN RECRUITING

CASE MIX / VOLUME ASSESSMENT

MANAGED CARE ANALYSIS

ASC DESIGN

CONSTRUCTION BUDGET

OPERATING / STAFFING BUDGET

COST TO INVEST / REVENUE PROJECTIONS /

ROI PROJECTIONS

Stop by booth #34 to connect with a member of the Regent team

or schedule a 20 minute assessment.

Chris Bishopcbishop@regentsurgicalhealth.com

615-202-4800

THANK YOU!