Kathy Feeny

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Kathy Feeny Executive Vice President
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Secure Horizons Senior Solutions Vision
GOAL Helping mature adults navigate through
their life events
PROCESS by providing an array of products,
services and resources to
RESULT achieve personal health and well-being
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National Medicare Enrollment
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Environmental Scan Medicare Choice
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Environmental ScanMedicare Choice
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Environmental Scan Medicare Choice Secure
Horizons
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Environmental Scan Medicare ChoiceWashington
Radar Screen
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Environmental Scan Medicare ChoiceWashington
Radar Screen

• Congress passes important MC Administrative
  reform
• Contained in Public Health Security and
  Bio-terrorism Response Act
• Delays Lock-in until 2005
• Moves ACR filing from July 1 to second Monday in
  September
• Extends annual open enrollment period until
  December 31
• Moves announcement of payment raises from March 1
  to second Monday in May
• The President is expected to sign the bill

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Environmental Scan Medicare ChoiceWashington
Radar Screen

• President Bush has proposed 190 billion over 10
  years for Medicare improvements and modernization
• In 2003 - 2005, 3.7 billion would go toward MC
• Minimum counties would receive 6.5 payment
  increase in 2003
• House Floor Action on Medicare Reform Legislation
  Expected within the Next 3 to 6 weeks
• Key Provisions increasing MC Funding
• Increased Funding for MC (5 to 6.5) for
  2002-2005
• Include IME Funding in the MC base (estimates
  not yet final but might up to an additional 2 in
  some areas)
• Expanded Drug Benefit (approximately 350 Billion
  for 2003-2012)
• Potential Increases in Provider and Hospital
  updates (indirect funding which raises the
  MedicareChoice baseline)

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Environmental Scan Medicare ChoiceWashington
Radar Screen

• Senate Floor Action Slated for Late Summer/Early
  Fall
• Key Provisions
• Increased Funding for Rural Healthcare Providers
• Drug Benefit in the Range of 450 to 750 Billion
  over 8 to 10 years
• Slight possibility of more MC funding

• Conference Committee Votes Predicted for Last
  Action Before Recess in October
• Expected Provisions
• MC Funding Increases
• Rural Funding
• Some Additional Provider Increases

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Environmental Scan Medicare ChoiceWashington
Radar Screen
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Strategy Medicare Choice
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Strategy Medicare Choice
2002 - 2003
Network
HCC
Revenue
Benefits Cost Sharing
Member
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2003 Benefits Strategy Medicare Choice

• Maintain Square Deal
• Balanced Member Cost Sharing
• Recognize Variances in Healthcare Costs

• Hoping for news on relief sooner than later .
  . .
• Exit as Last Resort
• Retain Membership

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Medicare ChoiceIf Relief Later than Sooner . .
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Secure Horizons 2002-2005Southern California
without Relief
68
107
-39
1
45
45
125
100
39
75
68
(146)
50
45
44
25
0
40
-25
-50
CMS Revenue 2
HCC Trend 8
Member Premium
Benefit Change
2002 GM
2005 GM
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New Health Products
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Environmental Scan New Health
ProductIndividual Medicare Supplement
Enrollment Trends from MC Exits

• 84 of Medical Supplement have no Drug Benefit
• 52 have a Drug Discount Card for Prescription
  Drugs

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New Health ProductIndividual Medicare Supplement
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New Health ProductIndividual Medicare Supplement
Today (2002)
Later Today (2002/2003)
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Strategy for GrowingIndividual Medicare
Supplement
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Environmental ScanNew Health Product Senior
Supplement
Complete Customer Solution - Sole Source
Carrier Active through Retiree coverage

• Senior Supplement - Group Medicare Indemnity
• National Capability
• Product designed with customer flexibility in
  mind creating
• A through Z plans
• Standard Supplement look-a-like A, C, F G
• Riders Pharmacy, Vision, Hearing
  Chiropractic

Secure Horizons - MedicareChoice Regional
Capability Standardized National Group
Retiree Plans Riders Pharmacy, Vision,
Hearing Chiropractic Committed to offering
MedicareChoice in counties where reimbursement
from the federal government allows for stability
in provider network
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Strategy for GrowingSenior Medicare Supplement
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Senior Market Dynamics
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Secure Horizons Senior Solutions Product
Innovation Looking Forward
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Secure Horizons Senior Solutions Priorities for
2002 and Beyond
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Product Development Timeline (2002)