Presented by: Bob Gilbert President, MedStar Ambulatory Services

November 3, 2016

The Retail Clinic Phenomenon

MedStar Health at a Glance

2

CatalyzingaShi-inNetworkDemands

Source:HealthCareAdvisoryBoardinterviewsandanalysis.

Market Forces Turning Patients into Consumers

Tradi&onalMarket RetailMarket

Growingnumberofbuyers1

Prolifera3onofproductop3ons2

Increasedtransparency3

Reducedswitchingcosts4

Greaterconsumercostexposure5

Passiveemployer,price-insulatedemployee

AcIvistemployer,price-sensiIveindividual

Broad,opennetworks Narrow,customnetworks

NoplaJormforapples-to-applesplancomparison

ClearplancomparisononexchangeplaJorms

DisrupIveforemployerstochangebenefitopIons

Easyforindividualstoswitchplansannually

ConstantemployeepremiumcontribuIon,low

deducIbles

VariableindividualpremiumcontribuIon,highdeducIbles

3

3

MedStar’s Consumer Strategy = Retail Strategy

MedStar Health’s Retail Strategy is to provide

health care efficiently and effectively:

Ø  where it’s wanted

Ø  when it’s wanted

Ø  how it’s wanted

. . . at a reasonable price.

4

Tele-Medicine

CVSMinuteClinic

FreeStandingED

Mul&-SpecialtyCenter

AcuityAcuteCareHospital

IPRehab

SNF OPRehab

HomeHealth

Hospital

Recovery&Rehabilita&on

Care

MedStar 2020 – Distributed Care Delivery Network

Campus-BasedAmbulatory

MACC

5

UrgentCare

Disruptive Technology: Telehealth? ProjecIonsAgreeonGrowth,ButHowAggressive?

Sources: Herman B, “Virtual reality: More insurers are embracing telehealth,” Modern Healthcare, February 2016, available at: http://www.modernhealthcare.com/article/20160220/MAGAZINE/302209980; ”Global Telemedicine Market – Growth, Trends and Forecasts (2015-2020),” Mordor Intelligence, http://www.mordorintelligence.com/industry-reports/global-telemedicine-market-industry, December 2015; Japsen, Bruce, “Doctors’ Virtual Consults with Patients to Double by 2020,” Forbes, http://www.forbes.com/sites/brucejapsen/2015/08/09/as-telehealth-booms-doctor-video-consults-to-double-by-2020/#2d4da3675d66, August 2015; Market Innovation Center research and analysis.

1)  CMS data. 2)  2015 HIS Analytics report.

16.6

26.9

2.1 5.4

14.5

21.5

2015 2020

Total

PCP Visits

Specialty Consults

$2.5

$17.6

0.0

5.0

10.0

15.0

20.0

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Year-Over-YearMedicareReimbursementforTelehealthServices1

Inmillionsofdollars

Es&matedU.S.GrowthinVirtualConsults2

MillionsofVisits5-YR

Growth

62%

48%

157%

604%Growth

6