athenahealth — Investor Day (December 2014)
126 slides from athenahealth's investor day presentation, Dec 11, 2014
Slide 1: 7th Annual Investor Summit December 11, 2014
7th Annual Investor Summit December 11, 2014
Slide 2: Welcome to Our 7th Annual Investor Summit
Welcome to Our 7th Annual Investor Summit! Dana Quattrochi Executive Director, Investor Relations
Slide 3: Agenda
Agenda 3 Opening Remarks Jonathan Bush, Chairman & Chief Executive Officer 1 2 Financial Discussion Kristi Matus, EVP, Chief Financial & Administrative Officer 3 Core Business Update Ed Park, EVP, Chief Operating Officer 4 Emerging Services Update Jeremy Delinsky, SVP, Chief Technology Officer 5 Cli
Slide 4: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements reflecting athenahealth, Inc. (“athenahealth” or “we”) management’s expectations for: futur
Slide 5: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures 5 In our earnings releases, conference calls, slide presentations, or webcasts, we may use or discuss non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each non-GAAP financial measure used or discusse
Slide 6: Opening Remarks
Opening Remarks Jonathan Bush Chairman & CEO
Slide 7: Patients disconnected from their own care and from cost
Patients disconnected from their own care and from cost patients without a PCP 62M http://www.nachc.com/pressrelease- detail.cfm?pressreleaseID=897 88% of patients not receiving “Well Patient” visits SOURCE: http://downloads.cms.gov/files/Beneficiaries-Utilizing-Free- Preventive-Services-by-State-YT
Slide 8: Providers disconnected from patients by EMRs, regulations
Providers disconnected from patients by EMRs, regulations, etc. Average visit duration :08M http://well.blogs.nytimes.com/2013/05/30/for-new-doctors-8-minutes-per-patient/?_r=0
Slide 9: Providers disconnected from each other
Providers disconnected from each other... of referrals come back with no information 55% Source: The New England Journal of Medicine, March 6, 2008, p. 1065.
Slide 10: ... and from the rest of the continuum
... and from the rest of the continuum USA rank in global life expectancy #42 https://www.cia.gov/library/publications/the-world- factbook/rankorder/2102rank.html
Slide 11: ... and from their sense of purpose
... and from their sense of purpose. of doctors wouldn’t recommend medicine 59% http://www.prweb.com/releases/2013/6/prweb10881121.htm
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Slide 13: We continue to follow the same principles
We continue to follow the same principles 13 To build the national health information backbone. To be health care providers’ most trusted service, helping them do well by doing the right thing. We are teachers and learners; in it for the mission and rewarded by team success. VISION MISSION CULTURE
Slide 14: Strategic priorities remain the same for 2015
And our strategic priorities remain the same for 2015 14 Transform the provider user experience Support the full continuum of care Open athenaNet® and build an ecosystem of partners Equip providers to win at alternative reimbursement
Slide 15: We focus our work with a one-pager
We focus our work with a one-pager 15 athenaNation • Develop seamless connection & knowledge flow among employees and offices • Launch “athena-Moves-Faster” • Spread & embed our mobile competence across athenaNation athenaNet • Make athenahealth the continuum of care clinical and financial record •
Slide 16: New and more heavily weighted corporate scorecard
We have a new and more heavily weighted corporate scorecard 16 • Bookings • Revenue • Non-GAAP Net Income Financial (45% weight) Satisfaction (20% weight) Performance (25% weight) Stability (10% weight) • Net Promoter Score • Client Days in Accounts Receivable • Closed-Loop Order Rate • Voluntary Tu
Slide 17: Organizing around strategic priorities
We are organizing ourselves around these strategic priorities 17 2015 Organization Chart “Same Game. New Teams” All Sales and account management for clients on athenahealth’s core services athenahealth network Administration of athenaNation Awareness by and access to the nation’s health care provide
Slide 18: Business Model Reminder
Business Model Reminder
Slide 19: Results
~~ RESULTS
Slide 20: Five integrated services that deliver immediate value
We provide five integrated services that deliver immediate value to providers and health systems 20 Improved clinical care and patient outcomes Population Health Management Revenue cycle management Documentation and workflow efficiency athenaCommunicator® Patient Engagement athenaCollector® Revenue
Slide 21: Who We Target
Who We Target
Slide 22: First signs that physician consolidation has leveled off
First signs that physician consolidation has leveled off 22 Source: athenahealth’s addressable market (physicians) based on athenahealth analysis using SK&A, HIMSS, and self-collected data 800 700 600 500 400 300 200 100 - 2011 2012 2013 2014 % Employed Physicians 650K 676K 684K 692K 44% 50% 57% 57%
Slide 23: It is not just large health systems employing physicians
13% 13% 74% 101-300 physicians Under 100 physicians 301+ physicians It is not just large health systems employing physicians 23 Source: athenahealth’s addressable market (physicians) based on athenahealth analysis using SK&A, HIMSS, and self-collected data Hospitals and Health Systems Employing Phys
Slide 24: National awareness continues to increase
And our national awareness continues to increase in the market 24 Base: All Respondents National (1060) Q8: Which of these companies are you aware of? Q11: To the best of your knowledge, what products or services does athenahealth provide? National Market Awareness of athenahealth 50% 40% 30% 20% 10
Slide 25: NOT The Preservers
NOT The Preservers Cut non-clinical costs Identify missed opportunities Get full credit for the care delivered
Slide 26: The Newbies
The Newbies e.g., Privia; Target; MedExpress Make money through scale & access Use data to drive decisions Empowered to use their own data
Slide 27: The Transformers
The Transformers e.g., Ascension; CHRISTUS; Steward Position for the ability to shop, sell, harvest Actively identify and harvest savings Aggressively grow patient share Need a new photo – crazy ones?
Slide 28: Key to market share is patient engagement and experience
The key to market share is cracking the code on patient engagement and patient experience 28 #2 #1 #3 Quality Empathy Access
Slide 29: The Land War
We have built our growth strategy around the “Land War” 29 The Land War
Slide 30: Winning the Hearts and Minds
…And also by building powerful brand bonds to get providers onto our network 30 Winning the Hearts and Minds
Slide 31: This is how we are going after the market
And this is how we are going after the market 31 Enterprises CDS, CME, athenaTextSM athenaText athenaOne® Enterprise Clinicals Enterprise Communicator Enterprise Collector Enterprise Coordinator Enterprise Individuals Informal groups Formal groups
Slide 32: On the right side of history; significant opportunity
We are on the right side of history and the opportunity for us is significant 32 Still have the right strategy 1 2 3 Still room to shop Still having fun
Slide 33: Financial Discussion
Financial Discussion Kristi Matus EVP, Chief Financial & Administrative Officer
Slide 34: Consistent track record of profitable growth
We have a consistent track record of profitable growth with significant opportunity ahead of us 34 Our strategies target massive, untapped market opportunities 1 2 3 Our success is aligned with our clients’ long-term success Our focused investments fuel future growth and profitability
Slide 35: Demonstrated track record of growth above 30% target
We have a demonstrated track record of growth: above our 30% target 35 1 CAGR from 2007 to 2015 Guidance (Mid Point) Consolidated Revenue ($M) $98 $1,000 $800 $600 $400 $200 $- 2007 (IPO) 2008 2009 2010 2011 2012 2013 2014 Mid Pt 2015 Mid Pt $136 $189 $246 $324 $422 $595 $740 $913
Slide 36: Years ago we were an emerging company
7 years ago we were an emerging company just starting to grow… 36 providers Collector (2000) 12k
Slide 37: Today a proven aggressive growth company
providers Epocrates (2013) 1.1M receiver nodes Coordinator (2012) 5k providers Communicator (2010) 39k providers Clinicals (2006) 23k …and today we are a proven aggressive growth company 37 providers Collector (2000) 59k
Slide 38: Our market opportunity is massive and growing
Our market opportunity is massive and growing 38 1 Calculated by multiplying athenahealth’s average billing rate of each service offering by $880B Hospital Expenditures and $560B Physician & Clinical Services, Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistic
Slide 39: We contribute directly to client success
increase in collections decrease in no-show rate Meaningful Use attestation rate reduction in days in accounts receivable EHR adoption rate We contribute directly to client success
Slide 40: Aligned incentives
ALIGNED INCENTIVES We succeed when our clients succeed 40 Client revenue and profit athenahealth fees Client revenue and profit athenahealth fees
Slide 41: Continued rapid adoption of core services
We enjoy continued rapid adoption of our core services 41 74% of 2014 Deals were athenaOne1 1 YTD Q3 2014 athenaCollector Providers 80,000 60,000 40,000 20,000 - 2007 2008 2009 2010 2011 2012 2013 Q3 YTD 2014 80% 60% 40% 20% 0% 12,118 18,768 23,366 27,114 32,740 39,752 50,212 59,415 athenaCommunicat
Slide 42: We grow as our clients grow
26%1 38%1 30%1 We grow as our clients grow 42 1 Percentage of athenaCollector Providers added from existing clients (go-live dates from prior years) 5,000 4,000 3,000 2,000 1,000 - Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 1,183 1,486 2,736 1,607 1,185 2,921 3,337 2,017 2,674
Slide 43: Client retention is high
Client retention is high, and forward results are predictable Source: “Ambulatory EMR Perception 2014: New Leaders Emerging as Market Shifts,” August 2014. © KLAS Enterprises, LLC. All rights reserved. Stuck between a Rock and a Hard Place Are you leaving, do you wish you could leave, or are you sta
Slide 44: Client retention is high, 95% retention rate
Client retention is high, and forward results are predictable Source: “Ambulatory EMR Perception 2014: New Leaders Emerging as Market Shifts,” August 2014. © KLAS Enterprises, LLC. All rights reserved. Stuck between a Rock and a Hard Place Are you leaving, do you wish you could leave, or are you sta
Slide 45: The power of our business model
45 This is the power of our business model 1 2 3 4 5 Low Customer Acquisition Costs: $0.55 to $0.60 of sales and marketing spend to get $1 recurring revenue Quick Payback: payback period to recover customer acquisition costs is less than 1 year High Lifetime Value of a Customer: ~6-7x customer acqui
Slide 46: Delivered both growth and profitability
As we have grown, we have delivered both growth and profitability - 100 200 300 400 2009 2010 2011 2012 2013 y/y Non-GAAP Adj. Gross Margin ($M) y/y Non-GAAP Adj. Op Inc Margin ($M) 1. Represents revenue and bookings growth from athenahealth branded-services (excludes Epocrates branded-services and
Slide 47: Continuously improving gross margin
We continuously improve our gross margin while investing in our services 47 70’s1 Mature Services Emerging Services New Services 50’s – 60’s1 20’s or below1 1 Non-GAAP Adjusted Gross Margin, excluding implementation fees and implementation costs
Slide 48: Growing share from lower cost athena-owned channels
Growing share from lower cost athena-owned channels 48 2015 budget includes a 30%+ increase in leads Developing low cost and high close rate channels 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2011 2012 2013 2014E 2015B Epocrates Affiliates Client Channel Partners Online Offline Events
Slide 49: Growing R&D investment focused on true innovation
Growing percentage of our R&D investment is focused on true innovation 49 1 R&D Project Categories: C1 (Stability), C2 (Gross Margin and Productivity), C3 (Service Enhancement), C4 ( New Service Development) 16% 12% 8% 4% 0% 2009 2010 2011 2012 2013 2014E 2015B C1/C2 61% 58% 56% 52% 50% 41% 39% C3/C
Slide 50: Investments to attract, stimulate, and retain talent
We are making the necessary investments to attract, stimulate, and retain talent 50 San Francisco, CA Mobile Innovation Center of Excellent 200+ employees today Austin, TX Research & Development Hub 60+ today; 600 employees in 10 years Watertown, MA Company Headquarters 1400+ employees today Atlanta
Slide 51: We are athenaNation
51 We are athenaNation 3,525 employees 7 locations 5 services 48K applicants YTD 2014 5K unique candidate interviews YTD 2014 1200 new hires YTD 2014 44% new hires from employee referrals 4 day new hire immersive course 99% new hires attended NHO 4-7 week training for client-facing roles 30+ compete
Slide 52: Path to long-term profitability targets
Path to long-term profitability targets 52 Today 63% 10% Long Term Goals Mid-High 70s Low- Mid 30s Gross Margin: Increasing automation and leveraging the network effect Growth: Increasing awareness and leveraging strong client relationships Innovation: Spending more on emerging services for our clie
Slide 53: 2015 guiding principles
53 2015 guiding principles 1 2 3 4 5 Grow bookings by 30% over fiscal year 2014 Maintain cost of bookings flat to fiscal year 2014 Improve non-GAAP adjusted gross margin for each service and overall Increase investment in research and development to support building our continuum of care strategy Sc
Slide 54: Strong revenue visibility into next year
83% 6% 7% 4% Existing Client Base (as of 09/14), less attrition* At Risk - To be implemented in Q4 2014 and FY 2015 At Risk - To be sold in Q4 2014 and FY 2015 Pharma Client Base The company continues to enjoy strong revenue visibility into next year 54 *Includes Epocrates subscription revenue and A
Slide 55: Fiscal year 2015 growth and profitability expectations
We are introducing our fiscal year 2015 growth and profitability expectations 55 Fiscal Year 2015 Expectations GAAP Total Revenue $900 - $925 million Non-GAAP Adjusted Gross Margin1 63.0% - 64.0% Non-GAAP Adjusted Operating Income1 $80 - $90 million Non-GAAP Adjusted Net Income per Diluted Share1 $1
Slide 56: The seeds of the health care internet are sprouting
The seeds of the health care internet are sprouting 56 Our strategies target massive, untapped market opportunities 1 2 3 Our success is aligned with our clients’ long- term success Our focused investments fuel future growth and profitability
Slide 57: Additional points of interest and guidance for fiscal year 2015
Additional points of interest and guidance for fiscal year 2015 57 It is best to assess our business on a year-over-year basis as there is typically an increase in expense levels during Q1 versus Q4 • FICA payroll tax reset, benefit rate changes, trade shows, etc. The number of working days varies e
Slide 58: Use of Non-GAAP financial measures
Use of Non-GAAP financial measures In our earnings releases, conference calls, slide presentations, or webcasts, we may use or discuss non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measure most directly comparable to each non-GAAP financial measure used or discussed,
Slide 59: Non-GAAP reconciliation for fiscal year 2014 expectations
Non-GAAP reconciliation for fiscal year 2014 expectations 59 Please note that the figures presented above may not sum exactly due to rounding. Non-GAAP Adjusted Gross Margin LOW HIGH Total revenue 725.0$ 755.0$ Direct operating expense 292.4 295.9 Total revenue less direct operating expense 432.6$ 4
Slide 60: Non-GAAP reconciliation for fiscal year 2014 expectations
Non-GAAP reconciliation for fiscal year 2014 expectations 60 Non-GAAP Adjusted Operating Income Please note that the figures presented above may not sum exactly due to rounding. LOW HIGH Total revenue 725.0$ 755.0$ GAAP net loss (6.8) (1.2) Add: (Benefit) provision for income taxes (0.6) 1.7 Add: To
Slide 61: Non-GAAP reconciliation for fiscal year 2014 expectations
Non-GAAP reconciliation for fiscal year 2014 expectations 61 Please note that the figures presented above may not sum exactly due to rounding. Non-GAAP Adjusted Net Income & Non-GAAP Adjusted EPS LOW HIGH GAAP net loss (6.8)$ (1.2)$ Add: Stock-based compensation expense 48.6 48.6 Add: Amortization o
Slide 62: Non-GAAP reconciliation for fiscal year 2014 expectations
Non-GAAP reconciliation for fiscal year 2014 expectations 62 Please note that the figures presented above may not sum exactly due to rounding. Non-GAAP Adjusted EPS LOW HIGH GAAP net loss per share - diluted (0.17)$ (0.03)$ Add: Stock-based compensation expense 1.23 1.23 Add: Amortization of capital
Slide 63: Non-GAAP reconciliation for fiscal year 2015 expectations
Non-GAAP reconciliation for fiscal year 2015 expectations 63 Please note that the figures presented above may not sum exactly due to rounding. Non-GAAP Adjusted Gross Margin LOW HIGH Total revenue 900.0$ 925.0$ Direct operating expense 359.5 359.5 Total revenue less direct operating expense 540.5$ 5
Slide 64: Non-GAAP reconciliation for fiscal year 2015 expectations
Non-GAAP reconciliation for fiscal year 2015 expectations 64 Please note that the figures presented above may not sum exactly due to rounding. Non-GAAP Adjusted Operating Income LOW HIGH Total revenue 900.0$ 925.0$ GAAP net loss (7.2) (3.1) Add: (Benefit) provision for income taxes (2.9) (0.4) Add:
Slide 65: Non-GAAP reconciliation for fiscal year 2015 expectations
Non-GAAP reconciliation for fiscal year 2015 expectations 65 Please note that the figures presented above may not sum exactly due to rounding. Non-GAAP Adjusted Net Income and Non-GAAP Adjusted EPS LOW HIGH GAAP net loss (7.2)$ (3.1)$ Add: Stock-based compensation expense 61.4 61.4 Add: Amortization
Slide 66: Non-GAAP reconciliation for fiscal year 2015 expectations
Non-GAAP reconciliation for fiscal year 2015 expectations 66 Please note that the figures presented above may not sum exactly due to rounding. Non-GAAP Adjusted EPS LOW HIGH GAAP net loss per share - diluted (0.18)$ (0.08)$ Add: Stock-based compensation expense 1.53 1.53 Add: Amortization of capital
Slide 67: Presentation Break
Presentation Break
Slide 68: Core Business Update
Core Business Update Ed Park EVP, Chief Operating Officer
Slide 69: 69
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Slide 70: View From The Air
View From The Air
Slide 71: Care is moving out of the hospital while outpatient visits rise
Care is moving out of the hospital while outpatient visits continue to rise 71 Source: MedPac Medicare Payment Advisory Commission, A Data Book: Health Care Spending and the Medicare Program, June 2014 http://www.medpac.gov/-documents-/data-book 2006 2007 2008 2009 2010 2011 2012 35 30 25 20 15 10 5
Slide 72: Patients are bearing more of the cost of sick-care
Well Visit (n=646,000) Colonoscopy (n=70,000) Outpatient Office Visit (n=6,683,000) MRI (n=45,000) Total Knee Replacement (n=15,000) One reason for this is that patients are bearing more of the cost of sick-care 72 Source: athenahealth data 2009 2012 $300 $250 $200 $150 $100 $50 $0 $15 Average Finan
Slide 73: ( Tay oO a
( Tay oO a Weavers) § (xHospitacs Qpatients (fcovernment
Slide 74: The government is taking an axe to Medicare
74 Source: Centers for Medicare & Medicaid Services, Office of the Actuary, Estimated Financial Effects of the “Patient Protection and Affordable Care Act,” as Amended, April 22, 2010 http://www.cms.gov/research-statistics-data-and-systems/research/actuarialstudies/downloads/ppaca_2010-04-22.pdf Med
Slide 75: Hospital margins will fall off a cliff
Hospitals will bear the brunt of these cuts and margins will fall off a cliff 75 Source: http://www.tha.com/blog/Default.aspx?pid=17 5.0% 0.0% -5.0% -10.0% -15.0% -20.0% -25.0% Total Hospital Medicare Margins by Year 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 201
Slide 76: Providers in Medicaid expansion states getting some reprieve
One silver lining: providers in Medicaid expansion states are getting some reprieve 76 Source: athenaResearch Samples Approximately 19 million visits to practices active on the athenahealth network before 2011 Proportion of Adult (18-64) PCP Visits from Medicaid and Uninsured Patients Medicaid Expan
Slide 77: The new world order is creating a scramble for patient volume
77 The new world order is creating a scramble for patient volume
Slide 78: Four consolidation plays on the healthcare chessboard
Small Physician Group We see four consolidation plays on the healthcare chessboard 78 Hospital Imaging Center Lab Pharmacy Special Surgery Retail Clinic Small Physician Group At-risk health system Urgent Care Hospital Small Physician Group Small Physician Group Orthopedics Specialty Clinic At-risk h
Slide 79: Providers need a partner to minimize controllable risks
Regardless of strategy, providers need a partner to minimize controllable risks 79 Operational Risk Need “instant-on” implementations and best-practice core workflows 1 2 3 Regulatory Risk Need to guarantee MU/MU2 and be future-proofed against regulatory uncertainty– e.g., ICD-10 Financial Risk Must
Slide 80: The view from the trenches
The view from the trenches ah SOSTAIN 07 Nea All in favor mye of waiting until someone invites us out of the pot...
Slide 81: Running a medical practice is messy and complicated
Running a medical practice is a messy, complicated business 81 •Schedule visit •Run eligibility inquiry •Send reminder call •Collect co-pay via credit card or e-check transaction •Ask about P4P-related clinical protocol measure •Document visit •Order prescription •Order lab order •Send referral •Ord
Slide 82: ... and it is only getting more complex
… and it is only getting more complex • Portal Registration • Direct scheduling • Referral management • Pre- authorization • Pre-certification • CCD exchange 82
Slide 83: Results
~~ RESULTS
Slide 84: 84
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Slide 85: Tried and true approach for scaling and growing services
We follow a tried and true approach for scaling and growing our services 85 Volume Cos t HIGH LOW LOW HIGH Service Maturity Perform & Learn Standardize & Aggregate Automate
Slide 86: Software or services
Many folks still think of what we do as mostly software or mostly services Cost to operate & deliver services 86 Cost to license, implement & maintain software vs.
Slide 87: We're both, creating a powerful and forgiving business model
The truth is that we’re both, and that has created a powerful and forgiving business model 87
Slide 88: Visibility Insight Action
1 Visibility 2 Insight 3 Action
Slide 89: Paper is still ubiquitous
One example: although we’re in the age of “digitization,” paper is still ubiquitous 89
Slide 90: Building interfaces to eliminate paper creates a scalable asset
Building interfaces to eliminate this paper has created a scalable asset 90 # Electronic Transactions (Millions) # Active Interfaces (Thousands) 1,000 750 500 250 - 2010 2011 2012 2013 Q3 YTD 2014 200 150 100 50 0
Slide 91: This drives margins, plenty of room to run
This, in turn, drives margins – and there is plenty of room to run here 91 1 Non-GAAP Adjusted Gross Margin, excluding implementation fees and implementation costs 70’s1 Mature Services Emerging Services New Services 50’s – 60’s1 20’s or below1 Total Automation Rate just 50% Today
Slide 92: Same discipline applied to client performance metrics
We apply this same discipline to client performance metrics 92 Provider Documentation Time Same Day Encounter Close Rate 0 1 2 3 4 Months Live 80% 75% 70% 65% 60% 55% 50% % of Encou n te rs Set A Set B 66% 70% 71% 69% 70% 71% 74% 72% 76% 61% 0 1 2 3 4 Months Live 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 M in
Slide 93: Helping clients close gaps in care
And we’re applying this discipline to help clients close gaps in care 93 Medicare Annual Wellness Visit % of patients who utilized annual service 12% 33% National average athenahealth clients SOURCE: http://downloads.cms.gov/files/Beneficiaries-Utilizing-Free-Preventive-Services-by-State-YTD2013.pdf
Slide 94: Client results: collections, no-show rate, receivables
6% increase in collections 8% decrease in no show rate 95% Meaningful Use attestation rate (2013) 32% reduction in days in accounts receivable 97% provider adoption rate
Slide 95: Rewarded as a first mover in a post-software world
We are being rewarded as a first mover in a post-software world 95 athenaCollector Providers athenaClinicals Providers athenaCommunicator Providers 2007: 12,118 2009: 1,471 2010: 1,213 2014: 59,415 2014: 23,053 2014: 38,699
Slide 96: Key takeaways
Key takeaways 96 The rules of the game keep changing and it is straining providers’ capabilities to keep up 1 2 3 Over the years, we’ve built a scalable asset that helps our clients thrive It is still the early innings of a long game and our results are being rewarded with growth
Slide 97: Emerging Services Update
Emerging Services Update Jeremy Delinsky SVP, Chief Technology Officer
Slide 98: Success formula requires an experience native to athenaNet
Our success formula requires an experience that feels native to athenaNet 98
Slide 99: Track record of commercializing core workflow products
We have a tremendous track record of commercializing core workflow products within athenaNet 99 Started development: Generally available: Best in KLAS: 1997 2004 2008 2000 2006 2010 2003 2011 2013 * © 2014 KLAS Enterprises, LLC. All rights reserved. www.KLASresearch.com
Slide 100: Disciplined M&A in core product development
Disciplined M&A has long been a key part of our core product development theory 100 Product Acceleration Capability and Expertise Access and Awareness Cost and Complexity ✔ ✔ ✔ ✔
Slide 101: Integration of cloud-based services: network, marketplace, accelerator
More recently, the seamless integration of other cloud-based services became a key component of product theory 101 • Entrepreneurs and startups with a shared mission • Conferences, hackathons, and other events encourage collaboration across the continuum of care Network • Disruptive health IT soluti
Slide 102: This is how we are going after the market
And this is how we are going after the market 102 Enterprises CDS, CME, athenaTextSM athenaText Clinicals Enterprise Communicator Enterprise Collector Enterprise Coordinator Enterprise Individuals Informal groups Formal groups
Slide 103: Emerging Service athenaText
Emerging Service athenaTextSM
Slide 104: athenaText awareness and access
104 Awareness and access Distribution of clinical decision support Personal hub for all physicians Remote control layer on top of EHR
Slide 105: Physicians using consumer tools to coordinate care
Physicians are using tools from their consumer lives to coordinate care 105 82% of physicians indicate the need for better collaboration in patient care 7% no need 11% unsure 42% Unsecure text message non-HIPAA compliant 58% EHR HIPAA compliant 42% secure email HIPAA compliant 71% phone call HIPAA c
Slide 106: Three overlapping user communities for athenaText
There are three overlapping user- communities for athenaText 106 athenaClinicals Epocrates Users athenaCoordinator Core Existing and new athenaClinicals client athenaText is a new feature Added convenience Used by Physicians & staff MD/DO & NPI have the ability to invite Existing & new athenaCoordin
Slide 107: athenaText will launch on three platforms
athenaText will simultaneously launch on three platforms 107 Secure. Immediate. Designed for health care providers. athenaText is a secure messaging application for medical professionals that enables better collaboration around patient care. Collaborative Connect across care teams Convenient Share i
Slide 108: Growth hacking for network adoption
We are carefully “growth hacking” for network adoption 108 athenaClinicals & athenaCoordinator Core Users Epocrates Users
Slide 109: Emerging Service athenaCoordinator Enterprise
Emerging Service athenaCoordinator® Enterprise
Slide 110: Front-end of the health system is a revenue sieve
The front-end of the health system is a revenue sieve… in an era of unprecedented financial pressure 110 Patients wait 33.4 days for follow-up care by playing appointment charades3 The average practice’s schedule is only3 70% full hospitals provided over $49B of uncompensated care in 20131 50% Of co
Slide 111: 3-pronged approach to deliver value
athenaCoordinator Enterprise uses a 3-pronged approach to deliver value 111 Open and optimize capacity 1 Identify patients in need of care 2 Enable seamless transitions in care 3
Slide 112: Promising results in Alpha deployment
The results, though early, are promising in our Alpha deployment experience 112 Our tools help manage 8% of the at-risk lives in the country 18.8% of direct scheduled appointments made by affiliated entities 45.6% improvement in first year ACO33 quality scores 65.2% reduction in referral- related de
Slide 113: Emerging Service athenaClinicals Enterprise
Emerging Service athenaClinicals® Enterprise
Slide 114: Virtually all physicians and hospitals intend to adopt an EHR
Virtually all physicians and hospitals intend to adopt an EHR EH EP Active Registrations as a Percentage of Eligible Participants 100% 90% 80% 70% 60% 50% 50% 30% % of R e g is te re d 2011 2012 2013 2014 33% 61% 84% 66% 83% 93% 95% 94% Source: http://www.cms.gov/Regulations-and- Guidance/Legislatio
Slide 115: Intentions aren't translating into results
Those intentions aren’t translating into results 87% of physicians can’t exchange information electronically with others outside their organization of eligible hospitals attested to Stage 1 MU of eligible hospitals have attested to Stage 2 MU 85% 34% 41% of EHR adopters can’t even enter lab and imag
Slide 116: Fewer vendors passing basic MU-driven requirements
Fewer vendors than ever are passing today’s basic, MU-driven functional requirements 116 LOSSES WINS LEGEND Losses, 1-200 Beds Losses, Over 200 Beds Wins, 1-200 Beds Wins, Over 200 Beds Source: “Clinical Market Share 2014: Competition Mounts as Markets Collide,” June 2014. © KLAS Enterprises, LLC. A
Slide 117: Hospital business model under assault
And the hospital business model is under assault, necessitating new operating platforms 117 Source: http://www.tha.com/blog/Default.aspx?pid=17 5.0% 0.0% -5.0% -10.0% -15.0% -20.0% -25.0% Total Hospital Medicare Margins by Year 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 20
Slide 118: Declaration of the post-EHR era
…Which has led to declaration of the “post-EHR” or “post-MU” era 118 “U.S. providers are feeling themselves in a place where they may have implemented the full functionality of an EHR, and they look at the roadmap for their EHR supplier and do not see the types of tools they need in order to restore
Slide 119: Ready to lead a post-software service-rich future
We’re ready to lead a “post-software” service-rich future beyond ambulatory Ready for fee-for-value Open platform Easy, automatic updates Rapid, low-cost implementation Best in KLAS usability #1 No capex Designed first for mobile Single patient record across the continuum of care Visibility, insight
Slide 120: Past performance is not an indicator of future outcomes
Past performance is not an indicator of future outcomes… but we love our chances Convenient care Physician Office Ancillary Setting Hospital Post-Acute Care Long-Term Care Home Generally available: 2000 2006 2010 2015 2015 1997 2004 2008 2013 2014 2015 Started development: Best in KLAS: 2003 2011 20
Slide 121: Presentation Break
Presentation Break
Slide 122: Client Panel Discussion
Stephen Kahane, M.D., M.S. President, Enterprise Solutions Client Panel Discussion
Slide 123: Client Panel
Client Panel 123 Andrew Aronson, M.D. Chief Medical Officer Privia Health Peter Plantes, M.D. CEO & Chief Physician Executive CHRISTUS Physician Network John Stewart SVP & Operations Leader Ascension Physician Services Moderator Stephen Kahane, M.D., M.S., President, Enterprise Solutions Panelists
Slide 124: Management Q&A
Management Q&A
Slide 125: Closing Remarks
Closing Remarks Jonathan Bush Chairman & CEO
Slide 126: Thank You
Thank You