UnitedHealthcare Expects to More Than Double Industry-Leading Accountable Care Contracts to $50 Bill

UnitedHealthcare Expects to More Than Double Industry-Leading Accountable Care Contracts to $50 Billion by 2017

• Company is increasingly rewarding care providers for delivering quality care

• Variety of accountable care payments available to care providers, ranging from primary care bonus programs to accountable care organization (ACO) incentives

• Accountable care programs show promising results, such as a 4 to 4.5 percentage point reduction in medical cost trend due to use of Patient-Centered Medical Homes

MINNETONKA, Minn.--(BUSINESS WIRE)-- UnitedHealthcare will significantly expand its already substantial base of accountable care contracts over the next five years across its employer-sponsored, Medicare and Medicaid health benefit businesses, helping transform how health care is delivered, paid for and rewarded.

UnitedHealthcare is placing much greater emphasis on rewarding care providers for better care and lower costs as it dramatically reduces the use of exclusively fee-for-service contracts.

Already more than $20 billion of UnitedHealthcare's reimbursements to hospitals, physicians and ancillary care providers are paid through contracts that link a portion of the reimbursement to quality and cost-efficiency measures. UnitedHealthcare expects that number to increase to $50 billion by 2017 as more care providers join the transition to accountable care contracts that reward quality and value-based health care.

UnitedHealthcare offers the largest care provider network in the United States and has accountable care relationships with more than 575 hospitals, 1,100 medical groups and 75,000 physicians across the country.

"We are improving health outcomes for patients at lower costs by moving even more broadly to value-based payment models and integrating those with our care provider network, product and clinical strategies," said Austin Pittman, president, UnitedHealthcare Networks. "Our unparalleled experience with accountable care models - and there are many - demonstrates that they can work better for everyone in health care, from patients to payers to care providers."

Accountable Care Strategy
UnitedHealthcare's accountable care strategy includes three categories of programs that offer varying levels of integration with care providers depending on their ability to assume financial risk and affect health outcomes. By creating a flexible approach, UnitedHealthcare is able to align its programs with all types of care providers across its employer-sponsored, Medicare and Medicaid benefit plans.

The level of shared accountability and financial risk between UnitedHealthcare and care providers increases with each of the three programs:

• Performance-based programs - may include bonus-based incentives for primary care practices, or performance-based contracts with hospitals, physicians and ancillary care providers that reward them for successfully improving patient health outcomes and lowering costs.

• Centers of Excellence programs - reimbursements are bundled for specific treatments and/or procedures (e.g., organ transplants) rather than charging for each visit or drug administered.

• Accountable care programs - ACOs and Patient-Centered Medical Homes are among the most common. In these programs, both the health plan and care provider share in the risk and savings associated with managing patients' health.

"Physicians have increasingly decided that the current fee-for-service model is not sustainable in the long term, but they want payment models that are more customized to meet their specific needs," said Ruth Benton, CEO of Denver-based New West Physicians. "One size certainly doesn't fit all, and UnitedHealthcare has worked with us closely to create a model that provides financial incentives and infrastructure support for delivering evidence-based high-quality care."

Programs Show Promising Results
UnitedHealthcare's accountable care strategy is showing promising trends in improving evidence-based care and quality outcomes while reducing costs.

For example:

• Performance-based programs have demonstrated improved quality and cost-efficiency outcomes, such as a 14 percent reduction in the use of non-Tier 1 prescriptions and a 25 percent reduction in the use of out-of-network laboratory services.

• The transplant Centers of Excellence program has demonstrated a 25 percent reduction in average length of hospital stays for transplant patients, a 16 percent reduction in transplants due to applying evidence-based care approaches and improved transplant survival rates at Centers of Excellence.

• Accountable care programs have proven results that demonstrate improved health outcomes, such as a 4 to 4.5 percentage point reduction in medical cost trend, a 16 percent reduction in emergency room visits and a 17 percent reduction in inpatient days, in addition to clinical quality results trending above program targets on 95 percent of all measures.

• Accountable care programs focused on Medicare Advantage plan members achieved at least a 4 Star HEDIS level on screenings for diabetes, cardiovascular care, colorectal cancer and rheumatoid arthritis.

"Through our work with UnitedHealthcare and leading primary-care practices, we believe a health care system that rewards care providers for accountable care, instead of fee-for-service care, results in better health outcomes and curbs health care costs for our employees," said Charlie Montreuil, Best Buy vice president, Enterprise Rewards. "Best Buy and UnitedHealthcare will continue to work together to help transform our health care system to make health care more accessible, affordable and accountable for quality and outcomes."

For more information about UnitedHealthcare's accountable care initiatives, visit www.AccountableCareAnswers.com.

About UnitedHealthcare
UnitedHealthcare is dedicated to helping people nationwide live healthier lives by simplifying the health care experience, meeting consumer health and wellness needs, and sustaining trusted relationships with care providers. The company offers the full spectrum of health benefit programs for individuals, employers and Medicare and Medicaid beneficiaries, and contracts directly with 780,000 physicians and other health care professionals and 5,900 hospitals and other care facilities nationwide. UnitedHealthcare serves more than 40 million people in health benefits and is one of the businesses of UnitedHealth Group (NYS: UNH) , a diversified Fortune 50 health and well-being company.

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UnitedHealthcare
Will Holman, 952-979-5862
william_s_holman@uhc.com

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