BOARD OF GOVERNORS MEETING #250

November 5, 2015 ● 2:00 PM

L.A. Care Health Plan1055 W. 7th Street, Los Angeles, CA 90017

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www.lacare.org Facebook/lacarehealth LinkedIn/company/l.a.-care-health-plan Twitter: @lacarehealth

Mission Statement

L.A. Care’s mission is to provide access to quality health care for Los Angeles County's vulnerable and low-income communities and residents and to support the safety net required to achieve that purpose.

Overview

Committed to the promotion of accessible, affordable and high quality health care, L.A. Care Health Plan (Local Initiative Health Authority of Los Angeles County) is an independent local public agency created by the State of California to provide health coverage to low-income Los Angeles County residents. With more than 1.8 million members in five product lines, L.A. Care is the nation’s largest publicly operated health plan.

L.A. Care Health Plan is governed by 13 board members representing specific stakeholder groups, including consumer members, physicians, federally qualified health centers, children’s health care providers, local hospitals and the Los Angeles County Department of Health Services.

L.A. Care advances individual and community health through a variety of targeted activities including a Community Health Investment Fund that has awarded more than $132 million throughout the years to support the health care safety net and expand health coverage. The patient-centered health plan has a robust system of consumer advisory groups, including eleven Regional Community Advisory Committees (governed by an Executive Community Advisory Committee), health promoters, and three Family Resource Centers that offer free health education and exercise classes to the community, and has made significant investments in Health Information Technology for the benefit of the more than 10,000 doctors and other health care professionals who serve L.A. Care members.

Programs

Medi-Cal – In addition to offering a direct Medi-Cal line of business, L.A. Care works with three subcontracted health plans to provide coverage to Medi-Cal members. These partners are Anthem Blue Cross, Care 1st Health Plan, and Kaiser Permanente. Since 2012, L.A. Care has enrolled more than 170,000 Seniors and Persons with Disabilities as members, and as of January 1, an additional 164,000 Healthy Way LA members transitioned to L.A. Care’s Medi-Cal program. Medi-Cal beneficiaries represent a vast majority of L.A. Care members.

L.A. Care Covered™ – As a state selected Qualified Health Plan, L.A. Care provides the opportunity for all members of a family to receive health coverage under one heath plan in the Covered California state exchange.

L.A. Care Cal MediConnect Plan– L.A. Care Cal MediConnect Plan provides coordinated care for Los Angeles

County seniors and people with disabilities who are eligible for Medicare and Medi-Cal.

L.A. Care Healthy Kids (0-5) – Sponsored by First 5 LA and the Children’s Health Initiative of Greater Los Angeles, Healthy Kids (0-5) provides health coverage for children who do not qualify for Medi-Cal and Healthy Families.

PASC-SEIU Homecare Workers Health Care Plan – L.A. Care provides health coverage to Los Angeles County’s In-Home Supportive Services (IHSS) workers, who enable our most vulnerable community members to remain safely in their homes by providing services such as meal preparation and personal care services.

About L.A. Care Health Plan

Updated 7/8/2015

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AGENDABOARD OF GOVERNORS MEETING No. 250Thursday, November 5, 2015, 2:00 P.M.L.A. Care Health Plan, 10th Floor, 1055 W. 7th Street, Los Angeles, CA 90017

Welcome Mark Gamble, Chair

1. Approve today’s Agenda Chair

2. Public Comment Chair

3. Approve October 1, 2015 meeting minutes Chair

4. Approve Consent Agenda Items

EXE 100 - Amendment No. 19 to Contract 04-36069 between the CaliforniaDepartment of Health Care Services and L.A. Care Health Plan, and to ratify any non-substantive changes)

FIN 100 - Quarterly Investment Report

FIN 101 - Health eConnex Contract Amendment

FIN 102 - Office Ally Contract Amendment

FIN 103 - Dickerson Employee Benefit Insurance Services Contract

FIN 104 - Annual Investment Policy

FIN 105 - Authorization to purchase eProcurement and Contract Management Software

FIN 106 - Cognizant Contract for ELDA

FIN 107 - FlexTech Contract Amendment

FIN 108 - Infosys Public Services Contract Amendment

FIN 109 - Cognizant, FlexTech, HCL and Infosys Contract Amendment for StaffAugmentation

FIN 110 - Delegation of authority to execute a Transforming Clinical Practice Initiative(TCPI) Practice Transformation Networks (PTN) grant from Centers for Medicare &Medicaid Services (CMS) for L.A. Care to help L.A. County primary care providers

ECA 100 - RCAC/CCI Membership

ECA 101 - Ratify Election of CCI Chair and Vice Chair

Chair

ADJOURN TO CLOSED SESSION (Est. time: 20 mins.) Chair

5. CONTRACT RATESPursuant to Welfare and Institutions Code Section 14087.38(m)

Plan Partner Rates

Provider Rates

DHCS Rates

6. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATIONPursuant to Section 54956.9 (d)(4) of the Ralph M. Brown ActOne potential case

RECONVENE IN OPEN SESSION Chair

7. Chairperson’s Report Chair

8. Chief Executive Officer Report

2015 Board of Governors Retreat Summary

Operations Report

Year-End Organizational Performance Report FY 2014-15

John BaackesChief Executive Officer

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Board of Governors Meeting AgendaNovember 5, 2015Page 2 of 2

Standing Committee Reports

Executive Committee

9. Government Affairs Update Cherie FieldsDirector, Government Affairs

Finance & Budget Committee

10. August 2015 Financial Report (FIN 111) Tim ReillyInterim Chief Financial Officer

11. Monthly Investment Report Tim Reilly

Governance Committee

12. 2016 Meeting Schedule and meeting frequency proposal (GOV 100) Elected Governance Chair

Advisory Committee Reports

13. Executive Community Advisory Committee Hilda Perez/Ozzie LopezBoard Consumer member and Advocate member

Adjournment

The next meeting will be on Thursday, December 3, 2015at L.A. Care Headquarters, 1055 W. 7th Street, Los Angeles, CA 90017

The order of items appearing on the agenda may change during the meeting. Teleconference arrangements may changeprior to the meeting. Those planning to participate by telephone should confirm with L.A. Care Board Services prior to

the meeting. Please keep your comments to three minutes or less.

THE PUBLIC MAY ADDRESS THE BOARD OF GOVERNORS ON ALL MATTERS LISTED ON THE AGENDA BY FILLING OUT A“REQUEST TO ADDRESS” FORM AND SUBMITTING THE FORM TO L.A. CARE STAFF PRESENT AT THE MEETING BEFORE THEAGENDA ITEM IS ANNOUNCED. YOUR NAME WILL BE CALLED WHEN THE ITEM YOU ARE ADDRESSING IS DISCUSSED. THE

PUBLIC MAY ALSO ADDRESS THE BOARD ON L.A. CARE MATTERS DURING PUBLIC COMMENT. AN AUDIO RECORDING OFTHE MEETING IS MADE TO ASSIST IN WRITING THE MINUTES AND IS RETAINED ONLY FOR 30 DAYS.

NOTE: THE BOARD OF GOVERNORS CURRENTLY MEETS ON THE FIRST THURSDAY OF MOST MONTHS AT 2:00 P.M. POSTEDAGENDA and PRINTED MEETING MATERIALS ARE AVAILABLE FOR INSPECTION AT Board Services, 1055 W. 7th Street – 10th Floor,

Los Angeles, California 90017.

Any documents distributed to a majority of the Board Members regarding any agenda item for an open session after the agenda hasbeen posted will be available for public inspection at Board Services, L.A. Care Health Plan, 1055 W. 7th Street, 10th Floor, Los Angeles,

CA 90017, during regular business hours, 8:00 a.m. to 5:00 p.m., Monday – Friday.

Meetings are accessible to people with disabilities. Individuals who may require any accommodations (alternative formats – i.e., large print, audio, translation of meetingmaterials, interpretation, etc.) to participate in this meeting and wish to request an alternative format for the agenda, meeting notice, and meeting packet may contact L.A.

Care’s Board Services Department at (213) 694-1250. Notification at least one week before the meeting will enable us to make reasonable arrangements to ensureaccessibility to the meetings and to the related materials.

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For information on the current month’s meetings, check calendar of events at www.lacare.org. Meetings may be cancelled or rescheduled at the last

moment. To check on a particular meeting, please call (213) 694-1250 or send email to boardservices@lacare.org.Prepared by mhbalones/printed on 10/30/15

Monday Tuesday Wednesday Thursday Friday Saturday Sunday

1

2 3 4Governance

2 pm(for approximately 2 hours)

5Board of Governors

2 pm(for approximately 2 hours)

6 7 8

9 10 11ECAC10 am

(for approximately 2 hours)

12 13 14 15

16 17CHCAC8:30 am

(for approximately 1-1/2hours)

18Finance & Budget

1 pm(for approximately 1-1/2hours)

Executive2:30 pm

(for approximately 2 hours)

19Compliance & Quality

2 pm(for approximately 2 hours)

20 21 22

23 24 25 26 27 28 29

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Schedule of Meetings

November 2015

5

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

1055 W. 7th Street, 10th Floor, Los Angeles, CA 90017Tel. (213) 694-1250 / Fax (213) 438-5728

MEETING DAY, TIME,

& LOCATION

MEETING DATES

MEMBERS

Board ofGovernors

General Meeting

1st Thursday2:00 PM

(for approximately 3 hours)1055 W. 7th Street,

10th Floor,Los Angeles, CA 90017

November 5December 3**

**Strategic Focusfrom 12:00-2:00 p.m. in

addition to regularBoard meeting from

2:00-5:00 p.m.

Mark Gamble, ChairpersonLouise McCarthy, Vice ChairpersonMichael Rembis, FACHE, TreasurerAlexander K. Li, MD, SecretaryHonorable Michael D. AntonovichHector De La TorreJann Hamilton LeeThomas Horowitz, DOOzzie LopezHilda PerezG. Michael Roybal, MD, MPHSheryl SpillerKimberly Uyeda, MD, MPH

Staff Contact:John Baackes, Chief Executive Officerx4102Linda Merkens, Manager, Board Services,x4050

Board of Governors & Public Advisory Committees

2015 Meeting Schedule / Member Listing

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

Board of Governors - Standing Committees

MEETING DAY,

TIME,

& LOCATION

2015

MEETING

DATES

MEMBERS

ExecutiveCommittee

4th Wednesday of themonth2:30 PM

(for approximately 2 hours)1055 W. 7th Street,

10th Floor, Los Angeles,CA 90017

** moved due toThanksgiving holiday

November 18**No meeting in

December

Mark Gamble, ChairpersonLouise McCarthyMichael Rembis, FACHEAlexander K. Li, MDThomas Horowitz, DOG. Michael Roybal, MD, MPH

Staff Contact:Linda Merkens, Manager, Board Services,x4050

Compliance &Quality

Committee

3rd Thursday every 2months2:30 PM

(for approximately 2 hours)

1055 W. 7th Street,10th Floor, Los Angeles,

CA 90017

November 19No meeting in

December

G. Michael Roybal, MD, MPH,ChairpersonSupervisor Michael AntonovichJann Hamilton LeeAlexander Li, MDHilda PerezKimberly Uyeda, MD

Staff Contact:Malou BalonesCommittee Liaison, Board Services, x 4183

Finance &Budget

Committee

4th Wednesday of themonth1:00 PM

(for approximately 2 hours)1055 W. 7th Street,

10th Floor, Los Angeles,CA 90017

** moved due toThanksgiving holiday

November 18**No meeting in

December

Michael A. Rembis, FACHE, ChairpersonMark GambleJann Hamilton LeeOzzie LopezLouise McCarthyHilda Perez

Staff Contact:Malou BalonesCommittee Liaison, Board Services/x 4183

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

MEETING DAY,

TIME,

& LOCATION

2015

MEETING

DATES

MEMBERS

GovernanceCommittee

1055 W. 7th Street,10th Floor

Los Angeles, CA 90017

MEETS AS NEEDED

November 42 pm

Chairperson to be electedThomas Horowitz, DOHector De La TorreOzzie LopezHilda PerezSheryl Spiller

Staff Contact:Malou BalonesCommittee Liaison, Board Services/x 4183

ServiceAgreementCommittee

1055 W. 7th Street,10th Floor

Los Angeles, CA 90017

MEETS AS NEEDED

Hector De La Torre, ChairpersonLouise McCarthyHilda PerezSheryl Spiller

Staff ContactMalou BalonesCommittee Liaison, Board Services/x 4183

Audit Committee 1055 W. 7th Street,10th Floor

Los Angeles, CA 90017

MEETS AS NEEDED

Chairperson to be electedHector De La TorreJann Hamilton LeeAlexander K. Li, MD

Staff ContactMalou BalonesCommittee Liaison, Board Services, x 4183

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

MEETING DAY,

TIME,

& LOCATION

MEETING

DATES MEMBERS

L.A. CareCommunity

Health

Meets Annually or asneeded

1055 W. 7th Street,10th Floor, Los Angeles,

CA 90017

Mark Gamble, ChairpersonLouise McCarthy, Vice ChairpersonMichael Rembis, FACHE, TreasurerAlexander K. Li, MD, SecretaryHonorable Michael D. AntonovichHector De La TorreJann Hamilton LeeThomas Horowitz, DOOzzie LopezHilda PerezG. Michael Roybal, MD, MPHSheryl SpillerKimberly Uyeda, MD, MPH

Staff Contact:John Baackes, Chief Executive Officerx4102Linda Merkens, Manager, Board Services,x4050

L.A. Care JointPowers Authority

Meets Quarterly or asneeded

1055 W. 7th Street,10th Floor, Los Angeles,

CA 90017

Mark Gamble, ChairpersonLouise McCarthy, Vice ChairpersonMichael Rembis, FACHE, TreasurerAlexander K. Li, MD, SecretaryHonorable Michael D. AntonovichHector De La TorreJann Hamilton LeeThomas Horowitz, DOOzzie LopezHilda PerezG. Michael Roybal, MD, MPHSheryl SpillerKimberly Uyeda, MD, MPH

Staff Contact:John Baackes, Chief Executive Officerx4102Linda Merkens, Manager, Board Services,x4050

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

Public Advisory Committees

MEETING DAY,

TIME,

& LOCATION

MEETING

DATES STAFF CONTACT

Children’s HealthConsultant Advisory

CommitteeGeneral Meeting

3rd Tuesday of every othermonth

8:30 AM(for approximately 2 hours)

1055 W. 7th Street,10th Floor, Los Angeles,

CA 90017

November 17 Lyndee Knox, PhD, Chairperson

Staff Contact:Malou BalonesCommittee Liaison, Board Services/x 4183

ExecutiveCommunity

Advisory Committee

2nd Wednesday of themonth

10:00 AM(for approximately 2 hours)

1055 W. 7th Street,10th Floor, Los Angeles,

CA 90017

November 11December 9

Elda Sevilla, Chairperson

Staff Contact:Idalia Chitica, Community Outreach &Education, Ext. 4420

Technical AdvisoryCommittee

4th Thursdays every othermonth

9:00 AM(for approximately 2 hours)

1055 W. 7th Street,10th Floor, Los Angeles,

CA 90017

The Committee isbeing restructured

Chairperson to be elected

Staff Contact:Malou BalonesCommittee Liaison, Board Services/x 4183

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

REGIONAL COMMUNITY ADVISORY COMMITTEES

REGION

MEETING DAY,

TIME,

& LOCATION

MEETING

DATE

STAFF CONTACT

Region 1Antelope Valley

3rd Friday of every othermonth

10:00 AM(for approximately 2-1/2 hours)Chimbole Cultural Center38350 N. Sierra Highway

Palmdale, CA 93550(661) 267-5656

December 18 Adela Guadarrama, Chairperson

Staff Contact:Judy Hsieh BigmanCommunity Outreach & Education, Ext.4199

Region 2San Fernando

Valley

3rd Monday of every othermonth

10:00 AM(for approximately 2-1/2 hours)

Family Resource Center-Pacoima

10807 San Fernando RoadPacoima, CA 91331

(844) 858-9942

December 21 Carlos Aguirre, Chairperson

Staff Contact:Judy Hsieh BigmanCommunity Outreach & Education, Ext.4199

Region 3Alhambra,

Pasadena andFoothill

3rd Tuesday of every othermonth

9:30 AM(for approximately 2-1/2 hours)

Rosemead Center3936 N. Muscatel Avenue,

Room 3Rosemead, CA 91770

(626) 569-2160

December 15 Lidia Parra, Chairperson

Staff Contact:Kristina ChungCommunity Outreach & Education, Ext.5139

Region 4Hollywood-

Wilshire, Centraland Glendale

3rd Tuesday of every othermonth

9:00 AM(for approximately 2-1/2 hours)Hope Street Family Center1600 Hope Street, Rm 305

Los Angeles, CA 90015(213) 742-6385

November 17 Hercilia Salvatierra, Chairperson

Staff Contact:Kristina ChungCommunity Outreach & Education, Ext.5139

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

REGION

MEETING DAY,

TIME,

& LOCATION

MEETING

DATE

STAFF CONTACT

Region 5West

3rd Monday of every othermonth2:00 PM

(for approximately 2-1/2 hours)Veterans Memorial Building

Garden Room4117 Overland AvenueCulver City, CA 90230

(310) 253-6625

December 21 Romalda Meza, Chairperson

Staff Contact:Martin VicenteCommunity Outreach & Education, x 4423

Region 6South, Compton,

Inglewood

3rd Thursday of everyother month

3:00 PM(for approximately 2-1/2 hours)Saint John’s Well Child &

Family Center808 W. 58th Street

Los Angeles, CA 90037(323) 541-1600

December 17 Dove Savage Pickney, Chairperson

Staff Contact:Frank MezaCommunity Outreach & Education, x 4239

Region 7San Antonio and

Bellflower

3rd Thursday of everyother month

4:30 PM(for approximately 2-1/2 hours)

Old Timers FoundationFamily Center

3355 E. Gage AvenueHuntington Park, CA 90255

(323) 582-6090

November 19 Dalia Cadena, Chairperson

Staff Contact:Frank MezaCommunity Outreach & Education, x 4239

Region 8Torrance and

Harbor

3rd Friday of every othermonth

10:30 AM(for approximately 2-1/2 hours)

Harbor Vista HousingCommunity Area

430 N. Wilmington Blvd.Wilmington, CA 90744

(310) 835-7660

November 20 Ana Romo – Chairperson

Staff Contact:Frank MezaCommunity Outreach & Education, x 4239

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

REGION

MEETING DAY,

TIME,

& LOCATION

MEETING

DATE

STAFF CONTACT

Region 9Long Beach

3rd Monday of every othermonth

9:00 AM(for approximately 2-1/2 hours)

Miller Family HealthEducation Center

3820 Cherry AvenueLong Beach, CA 90807

(562) 570-7987

November 16 Christina Deh-Lee, Chairperson

Staff Contact:Kristina ChungCommunity Outreach & Education, Ext.5139

Region 10East Los Angeles,

Whittier and North-East

3rd Thursday of everyother month

4:00 PM(for approximately 2-1/2 hours)Boyle Heights Technology

Youth Center1600 East 4th Street

Los Angeles, CA 90033(323) 526-0145

December 17 Elsa Gervacio, Chairperson

Staff Contact:Martin Vicente, Community Outreach &Education, Ext. 4423

Region 11Pomona and El

Monte

3rd Thursday of everyother Month

9:00 AM(for approximately 2-1/2 hours)

dA Center for the Arts252 D South Main Street

Pomona, CA 91766(909) 397-9716

November 19 Elda Sevilla, Chairperson

Staff Contact:Martin Vicente, Community Outreach &Education, Ext. 4423

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BOARD OF GOVERNORS & PUBLIC ADVISORY COMMITTEES

2015 MEETING SCHEDULE / MEMBER LISTING

For information on the current month’s meetings, check calendar of events at www.lacare.org.

Meetings may be cancelled or rescheduled at the last moment. To check on a particular meeting,

please call (213) 694-1250 or send email to boardservices@lacare.org.

COORDINATED CARE INITIATIVE (CCI) CONSUMER COUNCIL

REGION

MEETING DAY,

TIME,

& LOCATION

MEETING

DATE

STAFF CONTACT

Area 1Antelope Valley

3rd Tuesday of every othermonth

10:00 AM(for approximately 2-1/2 hours)Chimbole Cultural Center38350 N. Sierra Highway

Palmdale, CA 93550(661) 267-5656

November 17

Staff Contact:Jerry EdmondCommunity Outreach & Education, Ext.5254

Area 2San Fernando

Valley

4th Wednesday of everyother month

10:00 AM(for approximately 2-1/2 hours)

Family Resource Center-Pacoima

10807 San Fernando RoadPacoima, CA 91331

(877) 287-6290

November 18 *

*will meet the 3rd

Wednesday

Elizabeth Lyons, Chairperson

Staff Contact:Susan MaCommunity Outreach & Education, Ext.4586

Area 3South Los Angeles

4th Wednesday of everyother month

10:00 AM(for approximately 2-1/2 hours)

Rogers Park CommunityCenter

400 W. Beach AvenueInglewood, CA 90302

(310) 412-5504

December 16*

*Will meet the 3rd

Wednesday

Brenda White, Chairperson

Staff Contact:Jerry EdmondCommunity Outreach & Education, Ext.5254

Area 4Long Beach

4th Tuesday of every othermonth1:00 PM

(for approximately 2-1/2 hours)Mark Twain Branch Library

1325 E. Anaheim StreetLong Beach, CA 90813

(562) 570-1046

December 22

Staff Contact:Susan MaCommunity Outreach & Education, Ext.4586

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Page 1 of 14

DRAFT

Board of GovernorsGeneral Meeting # 249Meeting Minutes – October 1, 2015L.A. Care Health Plan Conference Room 1018-10191055 W. Seventh Street, Los Angeles, CA 90017

Members Management/StaffMark Gamble, Chairperson Thomas Horowitz, DO John Baackes, Chief Executive OfficerLouise McCarthy, Vice Chairperson Ozzie Lopez, MPA Gertrude S. Carter, MD, Chief Medical OfficerMichael A. Rembis, FACHE, Treasurer * Hilda Perez Jonathan Freedman, Interim Chief Operating Officer andAlexander K. Li, MD, Secretary G. Michael Roybal, MD, MPH Chief of Strategy, Regulatory & External AffairsMichael D. Antonovich Sheryl Spiller Augustavia J. Haydel, General CounselHector De La Torre Kimberly Uyeda, MD, MPH Tim Reilly, Interim Chief Financial OfficerJann Hamilton Lee Tom Schwaninger, Chief Information Officer

*Absent ** Teleconference

AGENDAITEM/PRESENTER MOTIONS / MAJOR DISCUSSIONS ACTION TAKENWELCOME

Mark Gamble

Mark Gamble, Chairperson, called the meeting to order at 2:05 p.m. and congratulated staff onthe opening of the member services center in the lobby.

He announced that the public may address the Board on any matter at the Public Commentsection at the beginning of this meeting, before or during the Board’s consideration of itemslisted on the Agenda. Guests are welcome to introduce themselves or can choose to remainanonymous. He welcomed the members of L.A. Care’s Regional Community AdvisoryCommittees(RCACs) and Coordinated Care Initiative (CCI) Councils and thanked them forcoming to the meeting.

Chairperson Gamble asked for a moment of silence in memory of Board Member Perez’grandfather, Loreto. He suggested that the meeting be adjourned in Loreto’s memory.

APPROVAL OFMEETING AGENDA

Mark Gamble

The meeting agenda was approved as presented. Approved unanimously.10 AYES (De La Torre,Gamble, Hamilton Lee,Horowitz, Li, McCarthy,Perez, Roybal, Spiller andUyeda).

PUBLIC COMMENT Member Perez left the meeting.

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Board of Governors MeetingOctober 1, 2015, Page 2 of 14 DRAFTDRAFT

AGENDAITEM/PRESENTER MOTIONS / MAJOR DISCUSSIONS ACTION TAKEN

Vivienne Grant-Peart, Manager of the Pico Women’s Medical Group, a contracted providerwith L.A. Care suggested that L.A. Care can do much more to bring value to the members bychanging the structure of L.A. Care from a delegated model, which does not work most of thetime, to a structure that directly contracts with providers to bring the plan and providers closerin providing care to the members. L.A. Care’s performance depends on the providers, andthere is a disconnect between the plan and providers. Authorizations for treatment are notprocessed in time to help the members get services in a timely manner. Authorizations aredenied without regard to treatment guidelines. Denied authorizations put patients at risk.

When Pico Women’s Medical Group had a direct contract with the health plan this was not aproblem. There is a problem in providing access to specialists. Specialists do not participate inthe plan because of low reimbursement and problems in getting paid. The patients are at riskwithout access to specialists. With the expansion of the Affordable Care Act (ACA) there hasbeen an influx of patients that have not routinely seen a physician in many years, who needchronic care management. She asked L.A. Care to look into direct contracting with its providersto improve services to members. She encouraged training for providers on the NationalCommittee for Quality Assurance (NCQA) guidelines and in billing codes to improve data onpatient care.

Mr. Baackes indicated to Ms. Grant-Peart that L.A. Care recognizes the problems with itsproviders and is working with providers to improve communication and performance, and toimprove access to quality services for L.A. Care members. Mr. Gamble thanked Ms. Grant-Peart for her comments and added that L.A. Care will be regularly communicating directly withall providers and will work with them to improve the organization’s performance.

Marcia Ramos, Chairperson, CCI Consumer Council Area 1, informed the Board that there arespecialists in the Antelope Valley but there are complaints about patient wait time to seespecialists. Some patients do not speak up because they do not want to have to drive outside theAntelope Valley to see a specialist. She reported that recently someone made a doctorappointment in her name, using her insurance card. Mr. Baackes noted that the provider shouldask for a photo ID to verify the insurance card. He also indicated that he will discuss thespecialists and providers in the Antelope Valley during his CEO report later in the meeting.

ACCEPTANCE OFMINUTES OFMEETING

Mark Gamble

The minutes of the September 3, 2015 meeting were approved as submitted. Approved unanimously.9 AYES (De La Torre,Gamble, Hamilton Lee,Horowitz, Li, McCarthy,Roybal, Spiller and

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Board of Governors MeetingOctober 1, 2015, Page 3 of 14 DRAFTDRAFT

AGENDAITEM/PRESENTER MOTIONS / MAJOR DISCUSSIONS ACTION TAKEN

Uyeda)

APPROVAL OFCONSENT AGENDA

Mark Gamble

Member Perez rejoined the meeting.

Workforce Solutions Group Contract (EXE 100)

Milliman, Inc. Contract (FIN 100)

Language Select Contract (FIN 101 )

MCG Contract (FIN 102)

2015-16 Compliance Plan and 2015-16 Code of Conduct (COM 100)

RCAC/CCI Membership (ECA 100)

Ratify Election of CCI Chair and Vice Chair (ECA 101)

New CHCAC Members (CHC 100)

Re-appointment of CHCAC Members (CHC 101)

Approved unanimously.10 AYES (De La Torre,Gamble, Hamilton Lee,Horowitz, Li, McCarthy,Perez, Roybal, Spiller andUyeda)

ADJOURN TOCLOSED SESSION

Mark Gamble

Augustavia J. Haydel, Esq., General Counsel, announced the following items to be discussed in closed session. The Boardadjourned to a closed session at 2:20 p.m.

CONTRACT RATESPursuant to Welfare and Institutions Code Section 14087.38(m)

Plan Partner Rates

Provider Rates

DHCS Rates

REPORT INVOLVING TRADE SECRETPursuant to Welfare and Institutions Code Section 14087.38(n)Discussion Concerning New Product LinesEstimated date of public disclosure: October 2017

Member Antonovich joined the meeting

CONFERENCE WITH REAL PROPERTY NEGOTIATORSProperty: 1200 West 7th Street, Los AngelesAgency Negotiator: John BaackesNegotiating Parties: Jason L. Warner, Managing Director of Jones Lang LaSalle; Charter Holdings, Inc.; RML Leasing Corp.,Wells Fargo Bank; David Conrad, CRA/LAUnder Negotiation: Price and Terms of Payment

CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATIONPursuant to Section 54956.9 (d)(4) of the Ralph M. Brown Act

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AGENDAITEM/PRESENTER MOTIONS / MAJOR DISCUSSIONS ACTION TAKEN

One potential case

RECONVENE INOPEN SESSION

Mark Gamble

The Board reconvened in open session at 2:42 p.m. Ms. Haydel reported that during the ClosedSession, the Board authorized staff to initiate a legal proceeding under item 8. CONFERENCEWITH LEGAL COUNSEL – ANTICIPATED LITIGATION, Pursuant to Section 54956.9(d)(4) of the Ralph M. Brown Act, one potential case.

CHAIRPERSON’SREPORT

Mark Gamble

Chairperson Gamble reported that he enjoyed attending the Consumer Advisory Group FallConference. He stressed the importance of involving members in L.A. Care’s structure andencouraged Board Members to attend RCAC meetings. He expressed his appreciation to theL.A. Care members that attend the Board Meetings. He recognized the importance of the newmember services center and thanked Board members for attending the opening event held justprior to this Board Meeting. He encouraged Board Members to recognize the unique focus ofL.A. Care on its members and asked Board Members to keep them in mind.

CHIEF EXECUTIVEOFFICER REPORT

John Baackes

John Baackes, Chief Executive Officer, reported:

At the September Retreat he presented a strategic vision for moving the company forwardbased on the growth of the plan resulting from expansion in membership. Since thenmeetings were held with managers and directors, and more recently with all staff, to explainthe strategic vision, the attributes that the organization will strive for going forward, anoperating plan, a structural reorganization and additional contracting options for providers.L.A. Care is recruiting for additional leadership staff.

Member Antonovich left the meeting.

As part of the strategic vision L.A. Care is asking for more accountability from its delegatedentities. A meeting was held on August 19 to present the delegated entities with theirindividual quality results. There was tremendous variation in the results. L.A. Care’sNCQA rating is only at the accredited level. L.A. Care is working with the providers toimprove the NCQA accreditation level and L.A. Care’s performance under quality measuresimposed by regulators, as these will increasingly be used to determine the level of paymentsto L.A. Care. Mr. Baackes will present the results to other L.A. Care service providers to gettheir participation in the effort to improve performance results for L.A. Care and help thecompany improve services to members.

With regard to the lack of access in the Antelope Valley (AV); L.A. Care has over the lastseveral months been in the AV developing contracts directly with providers. As of January1, L.A. Care will add 31 primary care providers and 44 specialists that were not previously

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contracted with L.A. Care. This will provide an opportunity to improve access for L.A.Care members. This will not solve every access issue in AV but will help many members.

Mr. Baackes reported that as the fall enrollment marketing season begins for Medicare andthe California Health Benefit Exchange, L.A. Care will also conduct marketing for Cal Medi-Connect (CMC) enrollment. He noted that 250 members were added in September.Medicare marketing will begin October 15, and L.A. Care will market L.A. Care Covered inNovember. Board Members will see advertising for L.A. Care. The goal is to build a brandand present a value proposition for audiences that can voluntarily enroll in L.A. Care.

Mr. Baackes will continue to visit RCAC and CCI meetings to hear member issues andsuggestions. He referenced the written report included in the materials for this meeting (acopy of the report can be obtained by contacting Board Services).

Member DeLaTorre asked for monthly notice of the RCAC meeting schedule.

Member Perez appreciates the effort to increase providers in the AV. She noted that membershave said providers will not take L.A. Care members, and she asked that staff look into how thatsituation can be improved. She thanked all who have visited RCAC, CCI Council and ECACmeetings. She reported that last week she attended two events at family resource centers(FRCs). She reported that on a hot day there was not enough water for attendees at one event.She thinks L.A. Care needs an overall coordinator for FRCs, to ensure that members have apleasant experience so they will return to FRCs and will encourage others to come to events atFRCs. She thanked everyone for their work on projects to improve L.A. Care services for itsmembers.

Mr. Freedman apologized for the shortage of water at the FRC event. He noted that L.A. Careis interviewing for the vacancy in FRC manager and is working on developing concepts for theFRCs. Ms. Perez asked Mr. Freedman to comment on expansion of the FRCs. Mr. Freedmannoted that the Board has given authority to staff to explore expansion of current FRCs and tolook for opportunities to open additional FRCs.

CHIEF MEDICALOFFICER REPORT

Gertrude S. Carter, MD

Gertrude S. Carter, MD, Chief Medical Officer, referred to the written report and asked forquestions. She reported that staff is working on HEDIS and patient satisfaction to improveL.A. Care’s quality ratings.

ADVISORY COMMITTEE REPORTS

Executive CommunityAdvisory Committee

Hilda Perez, Consumer Representative Board Member, reported that ECAC met on September 9.

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Hilda Perez/Ozzie LopezMember Perez thanked the RCAC / CCI Members attending today’s Board meeting and invitedthem to speak to the Board. She encouraged members to come to other meetings at L.A. Careby contacting Board Services or Community Outreach and Engagement staff.

RCAC1 Rut Hernandez2 Laura Rhone3 Gonzalo Sandoval4 Herceys Catalina Donis5 Mirna Aldana6 Edith Moreno7 Guadalupe Pérez8 Judith Lemaroy9 Ana Villaseñor10 Saraí Ángeles11 Claudia Cardona

CCI CouncilsArea 1 Marcia RamosArea 2 Elizabeth LyonsArea 3 Brenda WhiteArea 4 Bertha Poole

The Board approved motions for RCAC and CCI Council membership and ratification ofelected CCI Chairs and Vice Chairs for Areas 2 and 3, earlier on the Consent Agenda.

ECAC approved a proposed process for the 2016 election of a consumer representative andconsumer advocate representative to the Board of Governors by L.A. Care consumers.RCAC 2 members provided input on the election process. The revised 2016 electionprocess will be discussed at RCAC and CCI meetings in September and October 2015.Comments on the election process from the RCAC and CCI meetings will be brought byRCAC Chairs to the November 2015 ECAC meeting with the final election processdocument to be considered for approval by ECAC in December 2015.

(Member Lopez joined the meeting.)

On September 23, RCAC members met for the annual conference. The theme of theconference was “Empowered to make a difference”. Mark Gamble and John Baackesattended the conference.

On September 29, ECAC met with staff regarding the Interdisciplinary Committee. TheInterdisciplinary Committee was initiated as a tool to provide an opportunity for membersto give their input to L.A. Care and help improve quality. Members Perez and Lopez metwith Dr. Carter and Ms. Ferrer. The Committee was another way for members toparticipate in L.A. Care. A Member Services member attends each RCAC and CCI Councilmeeting to gather member input.

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Member Lopez asked that members be educated on the difference between filing agrievance and providing an opinion or describing a universal issue in the community. Hesuggested that members can be helpful if they are informed. He encouraged staff to findways to communicate effectively with members.

Mr. Baackes noted that during the recent regulatory audits L.A. Care was informed that themember input through the Interdisciplinary Committee was not being properly processedthrough the regulated grievance procedures. Staff is working with members on the purposeand process for member input on widespread community issues.

PUBLIC COMMENTMaggie Belton thanked Board Members for the opportunity to describe a long-standingproblem for an L.A. Care member regarding billing for out of network services.

Mr. Baackes thanked Ms. Belton for coming to the meeting. He clarified that the member isenrolled in the PASC-SEIU plan through L.A. Care. Mr. Freedman responded that it is verydisappointing to hear the description of the problem and L.A. Care will work to resolve it. Ms.Belton indicated that she is concerned that there may be others that have similar problems butmay not want to speak up for themselves.

Member Perez noted that she attended a meeting and spoke with Ms. Belton about the sameissue, and she clarified with Ms. Belton that the problem had not yet been resolved.

Member De La Torre thanked Ms. Belton for coming to the meeting, and he noted that he isopposed to the sub-plan at L.A. Care. His view is that everyone at L.A. Care should have accessto the full provider network offered by L.A. Care.

Motion ECA 100.1015*To approve the following candidate(s) to the Regional Community AdvisoryCommittees (RCAC), and Coordinated Care Initiative Councils (CCI) as reviewed bythe Executive Community Advisory Committee (ECAC) during the September 9, 2015ECAC meeting.

NameRCAC/CCI Area

Council #Type of Member

(Agency, if applicable)Deena M. Des Voigne RCAC 1 ConsumerJorge Trinidad RCAC 2 ConsumerDarlene T. Mcfield RCAC 2 ConsumerMaria Luisa Navarrete RCAC 5 Consumer

Motions ECA 100 andECA 101 wereunanimously approved aspart of the ConsentAgenda earlier in themeeting. 10 AYES.

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Deysi Corona RCAC 5 ConsumerLillie B. Greene RCAC 6 ConsumerElsa Martinez RCAC 7 ConsumerLiduvina Cortez RCAC 7 ConsumerLaura Lopez RCAC 7 ConsumerMaria Montes RCAC 8 ConsumerClaire McKay CCI Area 4 Consumer

Motion ECA 101.1015*To approve the elections of the following Chairperson and Vice Chairperson of theCoordinate Care Initiative (CCI) Councils for FY 2015-2016 as reviewed by the ExecutiveCommunity Advisory Committee (ECAC) at the September 9, 2015 meeting:

Elizabeth Lyons, Chair of CCI Area 2

Wilma Ballew, Vice-Chair of CCI Area 2

Brenda White, Chair of CCI Area 3

Lolita Willis, Vice-Chair of CCI Area 3

Children’s HealthConsultant AdvisoryCommittee

Kimberly Uyeda, MD

Member Uyeda reported that the Committee met on September 15. (A copy of the minutes may beobtained by contacting Board Services.)

The Committee motions to approve two new members and re-appointments of othermembers were approved earlier on the Consent Agenda.

The Committee received a report on the Perinatal Patient Experience. In March 2015, L.A.Care and CHCAC conducted patient experience interviews with three L.A. Care memberswho had recently delivered babies: one woman was a first-time mother, and the other twohad older children. The goal was to ascertain L.A. Care members’ experiences with perinataland postpartum care in an effort to identify barriers to accessing timely care.o Members shared challenges in enrolling with their OB of choice.o One member reported a three-month gap in her perinatal care because her request to

change health plans took three months.o Members reported up to three hours wait times at the doctor’s office for the first

prenatal visit.o They were unable to deliver at their preferred hospital due to the providers’ hospital

affiliation.o Members’ opinions of delivery hospitals were based largely on word-of-mouth as well as

their experiences during previous.o One member reported that a nurse told her that the baby was given a shot because the

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mother had an infection. The mother later found out that she did not have an infection,and she felt that the baby had been given the shot unnecessarily.

o Members reported high levels of satisfaction with L.A. Care’s phone call reminder for apostpartum visit.

o One member shared that the South Bay Clinic “Centering” program for well-babychecks in a group appointment setting resulted in shorter wait times.

o All three had taken measures to follow up with their providers when they hadexperienced some type of barrier to care.

o All three reported limited access to health education resources from their provider’soffice.

Member Uyeda noted that this small project demonstrates some of the things the Board hasrecently heard from L.A. Care members, and reflects the retreat discussion on the added valueof L.A. Care members as well as access issues and creative ways to improve access care for L.A.Care members. She has taken notes today on the new member services center, the FRCs andevents for members, and she particularly stressed the importance of the RCAC members andconsumer members as valuable partners in understanding areas where L.A. Care can improve itsservices to members.

Member Perez asked for information about the source of the experience survey. MemberUyeda responded that three members provided their input for the survey. Member Perezreported that CHCAC had previously discussed involving L.A. Care consumer members.Member Uyeda noted that for CHCAC members, the results of the survey drove home a needto work on the access issues for L.A. Care members.

Motion CHC 100.1015*To approve the nominations of :

Maryjane Puffer, representing Undesignated Seat 1 of 4

Nayat Mutafyan, representing Department of Children and Family Services Seatas Members of the Children’s Health Consultant Advisory Committee, for the first 4-year term from October 2015 to September 2019.

Motion CHC 101.1015*To approve the re-appointment of the following:

Tumaini Coker, MD, American Academy of Pediatrics

Maria Chandler, MD, MBA, Community Clinic Association of Los Angeles County

Lyndee Knox, PhD, Undesignated

Motions CHA 100 andCHA 101 wereunanimously approved aspart of the ConsentAgenda earlier in themeeting. 10 AYES.

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as member of the Children’s Health Consultant Advisory Committee, for the 2nd 4-yearterm for the period from September 2015 to August 2019.

STANDING COMMITTEE REPORTS

Executive Committee The Executive Committee met on September 23. Minutes are available by contacting BoardServices.

Government AffairsUpdate

Cherie Fields, Director of Government Affairs, reported:

Congress passed a continuing resolution to provide temporary budget funding untilDecember 11 to avoid a government shutdown. Republican members oppose funding forPlanned Parenthood, support increases for defense spending, and want a decrease indomestic spending on government programs.

Speaker Boehner announced his intent to retire from Congress. Two members haveformally announced their candidacy for Speaker of the House, one is from Florida and thesecond is Kevin McCarthy, from Kern/Tulare Counties in California.

In California, the legislature ended its regular session on September 11. Governor Brown hasuntil October 11 to take action on most of the legislation.

SB 147 (Hernandez), the L.A. Care sponsored legislation on Federally Qualified HealthCenter Alternative Payment Methodology pilot, was passed by the Legislature and is on theGovernor's desk for action. It is expected he will sign the bill.

The Special Session on health care financing called by the Governor to address the managedcare organization (MCO) is still open. There was no agreement on a model for the MCOtax, and no further action is expected before the next session of the Legislature, whichbegins in January 2016. Mr. Freedman clarified that the current MCO tax provides $1billion for health care in California. There is industry opposition to the tax, which willrequire 2/3rds vote of the legislature for passage. A large and difficult Medi-Cal fundingcrisis could evolve from this disagreement.

The only bill that passed out of the Special Session is a right to die bill, ABX2 X15, which iscurrently on the Governor's desk for action.

Member Lopez asked about issues under consideration by municipalities that may affect L.A.Care, to which Mr. Freedman responded that L.A. Care does not routinely monitor citygovernment activities. L.A. Care does participate in city events and programs, which areregularly reported to the Board as sponsorships. Member Lopez suggested that initiatives suchas the City of Los Angeles' Mayor's initiative on the homelessness may be of significance forL.A. Care. Mr. Freedman indicated that L.A. Care is actively discussing homelessness with Los

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Angeles County and Los Angeles City staff to building relationships to work on aligning mentalhealth and health resources with substance use programs, housing, and other support programsoutside the health plan.

Ms. Fields continued her report:

Dave Jones, California's Insurance Commissioner, has indicated he will run for CaliforniaAttorney General in 2018.

Member McCarthy asked for updates on statewide measures on the ballot. Ms. Fields and Ms.Haydel discussed that L.A. Care typically does not take formal positions on ballot initiatives, butthey would review the issues.

Motion approved under theConsent Agenda

Motion EXE 100.1015*To authorize staff to execute a contract with Workforce Solutions Group, LLC (WSG) inthe amount of $6,695,000 for temporary staff vendor management services for the periodbeginning October 1, 2015, through September 30, 2016, with a total contract amount notto exceed $16,027,111.

Motion EXE 100 wasunanimously approved aspart of the ConsentAgenda earlier in themeeting. 10 AYES.

Finance & BudgetCommittee

Mark Gamble, Chairperson, reported that the Committee met on August 26, 2015. (Minutes of themeetings can be obtained by contacting Board Services.)

Motions approved underthe Consent Agenda

Motion FIN 100.1015*To authorize staff to execute contracts not to exceed $650,000 in total, with Milliman,Inc., to provide actuarial models, services and support for Medicare and the IndividualExchange through September 30, 2016.

Motion FIN 101.1015*To authorize the Chief Executive Officer to execute a three-year contract with LanguageSelect for the provision of telephonic interpreting services in the amount of $2,670,000from January 1, 2016 to December 31, 2018.

Motion FIN 102.1015*To authorize staff to execute a contract with MCG for an amount not to exceed$5,000,000 from November 1, 2015 to October 31, 2018.

Motions FIN 100, FIN 101and FIN 102 wereunanimously approved aspart of the ConsentAgenda earlier in themeeting. 10 AYES.

Financial Report

Tim Reilly

Tim Reilly, Interim Chief Financial Officer, provided a summary of the financial statements throughAugust 2015.Chairperson Gamble left the meeting.

Approved unanimously.10 AYES (De La Torre,Hamilton Lee, Horowitz,

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Vice Chairperson McCarthy presided for the discussion and vote on Motion FIN 103.

Motion FIN 103.1015To accept the Financial Report for the ten months ended July 31, 2015, as submitted.

Li, Lopez, McCarthy,Perez, Roybal, Spiller andUyeda)

Monthly InvestmentTransaction Report

Mr. Reilly referenced the August 2015 Investment Transaction Report included in the meetingmaterials (a copy of the report can be obtained by contacting Board Services). He reported that L.A. Caremaintains investment accounts of $1.7 billion. Smaller amounts are invested in the Los AngelesCounty Pooled Investment Fund and in the Local Agency Investment Fund. The transactionreport is for funds which are managed by Payden & Rygel.

Chairperson Gamble rejoined the meeting.

Financial Report for August,2015

Mr. Reilly reported that through August, 2015, L.A. Care operated at a surplus of $26 million,resulting in a year-to-date surplus of $179.5 million. Positive results are expected to continuefor September. Staff is in the process of closing the books for the fiscal year, and L.A. Care’soutside financial auditors (Deloitte) have begun their work on site.

Compliance & QualityCommittee

G. Michael Roybal, MD

Committee Chairperson Roybal reported that the Committee met on September 17 (Minutes areavailable by contacting Board Services).

Committee members reelected me as the Committee Chairperson.

Denise Corley, Compliance Officer, provided an update on audits performed on L.A. Care andaudits performed by L.A. Care on Plan Partners and provider groups.o On July 21, L.A. Care received a Notice of Non-Compliance regarding re-submissions

for core and state-specific reports. Corrective steps have been taken by implementingdesktop procedures with technical guidance to ensure a quality review of reports is donebefore final submission.

o Final reports on the DHCS and DMHC joint audit are expected by the end of the year.Based on preliminary results, deficiencies may be identified in the following area: Inaccuracies in the Provider Directory as to status and location of Providers Care Coordination Individual Care Plan goals appear to be geared more to the plan than focused on

the member. Issues found with care coordination between CCS and PPGs. L.A. Care

provides a list of CCS members to PPGs but L.A. Care cannot verify that PCPscoordinate care and communicate with CCS providers.

Lack of specialists with experience was noted in the L.A. Care network. Credentialing

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Variance observed between certain provider medical records and the plan’sroster of credentialed providers

Failure to file a report to the Medical Board per California Business &Professions Code Section 805 for a provider whose arrest was witnessed by staffthat were conducting a Facility Site Review.

With regard to Prevention Quality Indicators, poor coordination of data was notedwith credentialing, peer review and PNO when looking at a provider.

Deficiencies on Utilization Management Clinical decision making Inconsistencies in L.A. Care’s authorization processes and its delegates Denial reason language at too high a reading level Incorrect delegation of oversight

L.A. Care has a new PBM. L.A. Care did not realize that processes were notupdated. Some policies have not been revised to reflect L.A. Care’s new relationshipwith Navitus.

Grievance and Appeals delegation oversight Claims timeliness

The Committee reviewed and approved the 2015-16 Compliance Work Plan and the Codeof Conduct.

The Committee met in closed session to discuss Peer Review. There was no reportableaction taken during the closed session.

Motion approved under theConsent Agenda

Motion COM 100.1015*To approve L.A. Care’s 2015-2016 Compliance Plan and 2015-2016 Code of Conduct, assubmitted.

Motion COM 100 wasunanimously approved inthe Consent Agendaearlier in the meeting. 10AYES.

ADJOURNMENT Mr. Baackes encouraged Board members to visit the Care Harbor LA event which begins onOctober 15, and is sponsored by L.A. Care.

Member Lopez encouraged the Board to consider an offsite meeting and at a different time ofday to increase opportunity for members to participate, or, in the alternative, he also suggestedconsideration of live streaming board meetings on the internet.

The meeting was adjourned at 3:56 p.m. in memory of Member Perez’ grandfather, Loreto.

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Board of Governors MeetingOctober 1, 2015, Page 14 of 14 DRAFTDRAFT

Respectfully submitted by:APPROVED BY: _______________________________________

Linda Merkens, Manager, Board Services Alexander Li, MD, SecretaryMalou Balones, Committee LiaisonJennifer Carabali, Committee Liaison

Date Signed _______________________________________

28

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. EXE 100.1115

Committee: Executive Chairperson: Mark Gamble

Issue: Execution of Amendment No. 19 (Contract No. 04-36069 A19) to L.A. Care’s Medi-Cal

Contract with the California Department of Health Care Services (DHCS).

Background: L.A. Care received Amendment No. 19 from DHCS on October 21, with a

request that it be reviewed, signed, and returned to DHCS by October 28, 2015. Amendment No. 19 extends the term of the L.A. Care/DHCS Medi-Cal Contract from December 31, 2015 to December 31, 2016.

Staff requests ratification of the Chief Executive Officer’s execution of Amendment No. 19.

Budget Impact:

Motion: To recommend that the Board ratify the Chief Executive Officer’s execution of Amendment No. 19 to Contract 04-36069 between the California Department of Health Care Services and L.A. Care Health Plan, and to ratify any non-substantive changes to Amendment No. 19 which may be made or negotiated by the Chief Executive Officer and/or his designees.

29

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 100.1115

Committee: Finance & Budget

Chairperson: Michael Rembis

Issue: Acceptance of the Investment Report for the quarter ended September 30, 2015.

Background:

Budget Impact:

Motion: To accept the Quarterly Investment Report for the quarter ended September 30, 2015, as submitted.

30

DATE: October 15, 2015

TO: Finance & Budget Committee

FROM: Timothy Reilly, Chief Financial Officer

SUBJECT: Quarterly Investment Report – September 2015 As of September 30, 2015, L.A. Care's combined investments market value was approximately $1.63 billion. Interest income and realized gains were around $1.7 million for the quarter. Based upon an independent compliance review performed at the end of the quarter, LA Care is in compliance with its investment policy guidelines pursuant to the California Government Code and the California Insurance code. At quarter end $1.57 billion (or 96% of total investments) were under the management of Payden and Rygel, an external professional asset management firm. The nature of these invested funds was as follows:

Holdings: U.S. Agency Securities 40% Corporate bonds 22% U.S. Treasury Securities 17% Asset Backed and Mortgage Backed Securities 15% Money Market 5% Other 1%

Average credit quality: AA Average duration: 0.4 years Average yield to maturity: 0.4%

These funds are managed as two separate portfolios by Payden & Rygel based on investment style – 1) the short-term portfolio and 2) the low duration portfolio. The short-term portfolio had approximately $1.49 billion invested as of 9/30/2015 and returned 0.06% for the quarter. The comparative short term money market index used as a benchmark returned 0.01%. The extended term portfolio had approximately $84 million invested and returned 0.12% for the quarter. The comparative 1-year Treasury note used as a benchmark had a return of 0.11%.

31

LA Care also invests with 2 government pooled investment funds - $49.6 million in Local Agency Investment Fund (LAIF) & $10 million in Los Angeles County Pooled Investment Fund (LACPIF). Based on most recent available data for the quarter, the Local Agency Investment Fund (LAIF) yielded approximately 0.33% in the quarter. Its total market value as of 9/30/15 was 66.5 billion with a weighted average maturity of around 210 days. LAIF is administered and overseen by the State Treasurer’s office. The fund’s investment holdings as of September 30, 2015 are as follows:

U.S. Treasury Securities 52% CD’s and bank notes 20% Agencies 14% Time deposits 9% Commercial paper 4% Other 1%

The Los Angeles County Pooled Investment Fund (LACPIF) yielded approximately 0.73% and 0.77% for the months of July and August, respectively. (September investment data has not been released yet by LACPIF.) Its total portfolio market value as of 8/31/2015 was around $21 billion, with a weighted average maturity of 608 days. LACPIF is administered and overseen by the Los Angeles County Treasurer. The fund’s most recent investment holdings (8/31/2015) is as follows:

U.S. Govt. and Agency Securities 66% Commercial paper 23% Negotiable CD’s 10% Other 1%

Other related items: The amount invested in BofA’s Treasury Reserve money market fund as of 9/30/15 is $65.4M.

32

Sperry Capital Inc.

Three Harbor Drive, Suite 101

Sausalito, CA 94965

Tel: 415.339.9201 Fax: 415.339.6030

JMartling@SperryCapital.com

October 14, 2015

Mr. Timothy Reilly

Chief Financial Officer

L.A. Care Health Plan

1055 West 7th Street, 10th Floor

Los Angeles, CA 90017

Re:

L.A. Care Health Plan

Quarterly Investment Report

July 1, 2015 through September 30, 2015

OVERVIEW

The California Government Code requires the L.A. Care Treasurer to submit a quarterly report

detailing its investment activity for the period. This investment report covers the three month period

from July 1, 2015 through September 30, 2015.

PAYDEN & RYGEL PORTFOLIO SUMMARY

As of September 30, 2015 the market values of the portfolios as managed by Payden & Rygel are as

follows:

Portfolios Payden & Rygel

Cash Portfolio #2365 $1,485,587,204.92

Low Duration Portfolio #2367 $ 83,891,964.51

Total $1,569,479,169.43

COMPLIANCE WITH THE ANNUAL INVESTMENT POLICY

Based upon an independent compliance review performed by Sperry Capital Inc. of the monthly

investment reports prepared by Payden & Rygel, L.A. Care is in compliance with L.A. Care’s

investment guidelines pursuant to the California Government Code and the California Insurance

Code. The Payden & Rygel investment reports include a monthly transaction summary along with the

current market values of the investments as of each month end. The Payden & Rygel investment

reports for L.A. Care are available upon request.

LA Care has invested funds California’s Local Agency Investment Fund (LAIF), the Los Angeles

33

Sperry Capital Inc.

October 14, 2015

Page 2 of 4

County Treasurer’s Pooled Investment Fund (LACPIF), and a Bank of America Merrill Lynch (BAML)

sweep account money market fund. In a LAIF statement dated October 1, 2015, the statement shows a

September 30, 2015 balance of $49,611,898.59. In the LACPIF statement dated October 6, 2015, the

LACPIF September 1, 2015 balance was $10,012,985.78. The LACPIF September 1, 2015 ending balance

does not reflect accrued interest. LACPIF will report the September 30, 2015 balance in the October

report. In the BAML report as of September 30, 2015 LA Care had $65,416,850.07 in a BAML market

sweep account.

Copies of the LAIF, LACPIF, and BAML monthly statements are available for review.

California Government Code Compliance Verification Detail as of September 30, 2015

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

UST US Agencies State of CA Negotiable

CDs

MTN's MMFs Mort/Asset

Backed

Total Payden & Rygel Portfolio

($1,569,479,169.43 as of September 30, 2015)

Maximum Percentage Actual Percentage

34

Sperry Capital Inc.

October 14, 2015

Page 3 of 4

California Government Code Compliance Payden & Rygel Verification Detail as of September 30,

2015

#2365 #2367 #2365 #2367

Enhanced Cash Low Duration Enhanced Cash Low Duration Compliance

US Treasuries 5 Years 5 Years 1.3 Years 0.8 Years Yes

US Agencies 5 Years 5 Years 2.5 Years 2.0 Years Yes

State of CA 5 Years 5 Years 1.8 Years 1.8 Years Yes

Negotiable CDs 270 Days 270 Days 148 Days 148 Days Yes

Corporates (MTNs) 5 Years 5 Years 2.9 Years 2.9 Years Yes

MM & Mutual Funds NA NA 1 Day 1 Day Yes

Mortgage/Asset-Backed 5 Years 5 Years 4.6 Years 4.5 Years Yes

Actual Maximum MaturityMaximum Permitted Maturity

MARKET COMMENTARY

Short-term interest rates were generally flat in the third quarter. However the 10 year U.S. Treasury

bond yield dropped by almost 25 basis points to close at 2.06% September 30.

U.S. economy shows signs of slowing: Good news for the U.S. economy continued in September, but

signs of slowing growth were apparent. Positive data points included rising auto sales, at 10-year

highs, and very strong results from the service sector, which constitutes seven-eighths of the economy

and where the primary business surveys remain at close to 10-year highs. Personal income and

spending also showed reasonable gains, with strong underlying details.

Other economic news, however, was mixed. New home sales continued to grow at a strong rate, and

confidence in the homebuilding industry set a new high, but existing home sales were down. The

pattern of mixed data continued in retail sales, which grew less than expected, although that was

largely due to declines in gasoline prices.

The weakest part of the month was employment. Job gains were well below expectations, at 142,000,

far less than the 200,000-plus levels of recent months.

Despite economic gains, given the signs of a U.S. slowdown and risks elsewhere in the world, the

Federal Reserve (Fed) decided to postpone raising rates, a somewhat surprising decision that rattled

markets. The Fed did indicate that it would likely raise rates this year, but the continued uncertainty

about timing, along with fears regarding what the Fed is seeing that prevented it from raising rates,

likely contributed to September's market turmoil.

35

Sperry Capital Inc.

October 14, 2015

Page 4 of 4

COMPLIANCE WITH THE ANNUAL INVESTMENT POLICY

Based on Sperry Capital’s review of Payden & Rygel’s month-end reports, L.A. Care’s Payden &

Rygel’s portfolios were in compliance with its Annual Investment Guidelines and the California

Government Code and the Insurance Code sections noted above. Based on Sperry Capital’s review of

the LAIF and LACPIF quarterly reports and their respective investment guidelines, the LAIF and

LACPIF investments are in compliance with the Annual Investment Policy and the California

Government Code and the California Insurance Code.

Sincerely,

James W. Martling

Principal

Copy: Jason Chen, LA Care

36

QUARTERLY PORTFOLIO REVIEWQUARTERLY PORTFOLIO REVIEW

PAYDEN.COM

LOS ANGELES | BOSTON | LONDON | PARIS

3rd Quarter 2015

37

October 2015

Dear Client,

Three months ago when I sat down to pen the last quarterly letter, Greece dominated the headlines. Today almost nobody asks me, “What do you think about a Grexit?” As usual, the lesson is that what the media wants to talk about does not have an enduring impact on your portfolio.

As I write this letter I am tempted to comment on what the Federal Reserve might do in the months ahead or on recent Chinese economic and financial market developments, but I am not going to do that. Instead, I want to remind you that even if the Fed acts in 2015 the global economic backdrop remains largely unchanged. Let’s review the major trends. First, inflation has slowed over the last 30 years. In 1980, 92% of countries had inflation over 5%, today only 31% have inflation over 5%. Second, the world is more interconnected than ever before. How do we measure that? We look at exports as a share of global GDP. In 1914, at the peak of the previous era of globalization and on the eve of the First World War, exports’ share of GDP was 16% whereas today it is 32%.

So what does all of this mean for your portfolio? Low inflation and slightly slower growth imply low global interest rates, all else equal. Both shorter- and longer-term government bond yields are low, and will likely remain low, regardless of what the Fed does in the next few months. Further, the more globalized the world becomes, the more synchronous the economy. Sure, we can tell you that only 1% of U.S. GDP is generated from exports to China. However, in a hyper-globalized world, we are truly all in it together, and a slowdown in one country or region can reverberate worldwide. Even Federal Reserve officials admitted as much at their September meeting.

I’ve witnessed one of the greatest economic development stories in history with the transformation of the global economy over the last 30 years. I suspect some opportunities will present themselves as investors adjust to the next phase of global growth.

How does this translate into returns over the next few quarters? In the near term, it is likely that we will experience low single-digit returns. Looking a bit further ahead, a pick-up in the global economy will present opportunities domestically and abroad. The world is positioned for growth over the next decade, and we are cautious but optimistic, focusing our investment philosophy on providing diversification and flexibility for our clients.

Best wishes for the autumn,

Joan A. Payden

President & CEO

LETTER FROM THE CEO

38

Payden&Rygel 333 S. Grand Avenue Los Angeles, California 90071 (213) 625-1900 www.payden.com

Absolute ReturnAbsolute Return

L.A. Care Health Plan Combined PortfolioPortfolio Review – 3rd Quarter 2015

Sector Allocation Maturity Distribution

PORTFOLIO RETURNS – All Periods Annualized

Market Value $1,569,479,169Average Credit Quality AAAverage Duration 0.4 yearsAverage Yield to Maturity 0.4%

PORTFOLIO CHARACTERISTICS (As of 09/30/15)

Market Value PercentCash $10,563,164 0.7%Money Market 83,033,364 5.3%Treasury 260,897,711 16.6%Agency 624,931,995 39.8%Credit 341,387,590 21.8%ABS/MBS 229,006,426 14.6%Municipal 19,658,919 1.3%

$1,569,479,169 100.0%

Percent Maret Value<90 day 51.4% $807,053,373

90 days-1 year 41.0% 643,146,460

1 - 2 years 5.2% 81,036,752

2 - 5 years 2.4% 38,242,584

100.0% $1,569,479,169

Periods ended 09/30/15

* iMoneyNet Institutional Taxable Money Market Yield** Merrill Lynch 1-3 Yr Treasury Index from inception to 3/31/2010; Merrill Lynch 1-Yr Treasury Index thereafter.

3rd Qtr 2015 YTDTrailing

1 YrTrailing

3 Yrs

Short Term Portfolio 0.06% 0.16% 0.18% 0.24%

Money Market Index* 0.01% 0.02% 0.02% 0.02%

Extended Term Portfolio 0.12% 0.47% 0.53% 0.48%

1-year Treasury Note** 0.11% 0.32% 0.25% 0.27%

Combined Portfolio 0.07% 0.18% 0.20% 0.29%

39

Payden&Rygel 333 S. Grand Avenue Los Angeles, California 90071 (213) 625-1900 www.payden.com

L.A. Care Health Plan Short Term PortfolioPortfolio Review – 3rd Quarter 2015

Sector Allocation Maturity Distribution

PORTFOLIO RETURNS – All Periods Annualized

Market Value $1,485,587,205Average Credit Quality AAAverage Duration 0.4 yearsAverage Yield to Maturity 0.4%

PORTFOLIO CHARACTERISTICS (As of 09/30/15)

Market Value PercentCash $9,598,625 0.6%Money Market 75,030,154 5.1%Treasury 250,270,735 16.8%Agency 609,831,428 41.0%Credit 308,642,580 20.8%ABS/MBS 213,338,223 14.4%Municipal 18,875,460 1.3%

$1,485,587,205 100.0%

Percent Maret Value<90 day 51.4% $764,214,390

90 days-1 year 41.6% 617,531,817

1 - 2 years 4.7% 69,954,942

2 - 5 years 2.3% 33,886,056

100.0% $1,485,587,205

Periods ended 09/30/15

* iMoneyNet Institutional Taxable Money Market Yield** Merrill Lynch 1-3 Yr Treasury Index from inception to 3/31/2010; Merrill Lynch 1-Yr Treasury Index thereafter.

3rd Qtr 2015 YTDTrailing

1 YrTrailing

3 Yrs

Short Term Portfolio 0.06% 0.16% 0.18% 0.24%

Money Market Index* 0.01% 0.02% 0.02% 0.02%

40

Payden&Rygel 333 S. Grand Avenue Los Angeles, California 90071 (213) 625-1900 www.payden.com

Portfolio Review and Market Update – 3rd Quarter 2015

MARKET THEMES

Financial markets experienced a flight to quality during the quarter sparked by growth concerns in Chinaand a renewed deterioration across the commodity sector. Risk assets, including all credit-related fixed-income sectors, underperformed U.S. Treasuries. Citing global growth concerns, the Federal OpenMarket Committee did not increase the Federal Funds rate in September, despite data indicatingimprovement in employment and growth situations. The 2-year Treasury yield ranged between 0.54%and 0.81% intra-quarter, and closed September at 0.63%, demonstrating the investor uncertaintyregarding the future path of interest rates.

STRATEGY

The portfolio holds a diversified mix of credit sectors for income generation and is positioned inanticipation of a hike in short-term interest rates by the Federal Reserve before year end. The 0.4year duration position is structured with a mix of fixed- and floating-rate securities, while maintaininglonger duration exposure in corporate bonds to take advantage of their yield premium.

Corporates remain attractive, and we continue to participate in the new issue market to takeadvantage of pricing concessions. Within corporates we are maintaining our floating-rate exposure.

We maintain our allocation to high-quality asset-backed and mortgage-backed securities (ABS/MBS)with short duration profiles for their yield and diversification benefits.

INTEREST RATES

Treasury yields declined during the quarter generating positive returns.The portfolio’s duration position added to performance, as yields generally fell across the curve.The longer-maturity corporate positions contributed positively to total return despite modest creditspread widening.

SECTOR

Credit spreads widened on overall global economic weakness, with energy, mining and auto sectorsfaring poorly. The portfolio overweight to credit detracted from alpha, while the overweight to thefinancial sector was positive.ABS and MBS spreads widened due to increased market volatility. The performance impact wasneutral as the yield advantage was offset by modestly lower prices.

41

Payden&Rygel 333 S. Grand Avenue Los Angeles, California 90071 (213) 625-1900 www.payden.com

L.A. Care Health Plan Extended Term PortfolioPortfolio Review – 3rd Quarter 2015

Sector Allocation Maturity Distribution

PORTFOLIO RETURNS – All Periods Annualized

Market Value $83,891,965Average Credit Quality AAAverage Duration 0.5 yearsAverage Yield to Maturity 0.6%

PORTFOLIO CHARACTERISTICS (As of 09/30/15)

Market Value PercentCash $964,539 1.1%Money Market 8,003,210 9.5%Treasury 10,626,975 12.7%Agency 15,100,567 18.0%Credit 32,745,010 39.0%ABS/MBS 15,668,204 18.7%Municipal 783,560 0.9%

$83,892,065 100.0%

Percent Maret Value<90 day 51.1% $42,838,984

90 days-1 year 30.5% 25,614,644

1 - 2 years 13.2% 11,081,809

2 - 5 years 5.2% 4,356,528

100.0% $83,891,965

Periods ended 09/30/15

* iMoneyNet Institutional Taxable Money Market Yield** Merrill Lynch 1-3 Yr Treasury Index from inception to 3/31/2010; Merrill Lynch 1-Yr Treasury Index thereafter.

3rd Qtr 2015 YTDTrailing

1 YrTrailing

3 Yrs

Extended Term Portfolio 0.12% 0.47% 0.53% 0.48%

1-year Treasury Note** 0.11% 0.32% 0.25% 0.27%

42

Payden&Rygel 333 S. Grand Avenue Los Angeles, California 90071 (213) 625-1900 www.payden.com

Portfolio Review and Market Update - 3rd Quarter 2015

MARKET THEMES

Financial markets experienced a flight to quality during the quarter sparked by growth concerns in Chinaand a renewed deterioration across the commodity sector. Risk assets, including all credit-related fixed-income sectors, underperformed U.S. Treasuries. Citing global growth concerns, the Federal OpenMarket Committee did not increase the Federal Funds rate in September, despite data indicating animprovement in employment and growth. The 2-year Treasury yield ranged between 0.54% and 0.81%intra-quarter, and closed September at 0.63%, demonstrating investor uncertainty regarding the futurepath of interest rates.

STRATEGY

The portfolio holds a diversified mix of credit sectors for income generation and is positioned inanticipation of a hike in short-term interest rates by the Federal Reserve before year end. The defensiveduration position is structured with less emphasis on 1- to 2-year maturities, as they have the mostsensitivity to Fed actions, while maintaining longer duration exposure in corporate bonds to takeadvantage of their yield premium.

Corporates remain attractive, and we continue to participate in the new issue market to take advantageof pricing concessions. Within corporates we favor 3-year fixed-rate bonds.

We maintain our allocation to high-quality asset-backed and mortgage-backed securities (ABS/MBS)with short duration profiles for their yield and diversification benefits.

INTEREST RATES

Treasury yields declined during the quarter, generating positive returns.The portfolio’s defensive duration position detracted from performance, as yields generally fell across the curve. The longer-maturity corporate positions contributed positively despite modest credit spread widening.

SECTOR

Credit spreads widened on overall global economic weakness, with energy, mining and auto sectorsfaring poorly. The portfolio overweight to credit detracted from performance, while the overweight tothe financial sector was positive.ABS and MBS spreads widened due to increased market volatility. The performance impact wasneutral as the yield advantage was offset by modestly lower prices.

43

Appreciate the History of the Chinese Yuan

MARKET PERSPECTIVE

6.0

Yuan

Per

Dol

lar

(Inve

rted

Axi

s) 6.5

7.0

7.5

8.0

8.5

9.01997 2003 2006 20092000 2012 20151994

1 2

3 4

5 6

78

Appreciation (yuan buys more dollars)

Depreciation (yuan buys fewer dollars)

News that China’s currency, the yuan, would be allowed to depreciate against the U.S. dollar rattled global markets in the third quarter. Investors were surprised, and the media labeled the move as an unexpected devaluation. We think the news was overhyped, particularly when viewed historically. In 1994, after years of rapid inflation, Chinese policymakers pegged the currency to the U.S. dollar to promote monetary stability and credibility. The move paid huge economic dividends; China became a mega global trader, foreign investment flowed into the country, the economy blossomed, and the currency appreciated. The August move, where the currency fell by about 4%, is small in the grand scheme of things. Why then, would China take such action? It could have been to boost exports; however, a better explanation might be China’s desire to push the yuan toward global reserve currency status. To achieve that status a free floating currency is required. A history of the Chinese yuan is provided below.

After years of inflation, China pegs its currency to the U.S. dollar to bring monetary stability.

U.S. Treasury calls China a “currency manipulator.”

China joins the World Trade Organization.

Yuan is pegged against a basket of currencies; Beijing allows it to strengthen by 2.1% under pressure from the U.S.

China stops the appreciation amid slowing exports.

U.S./G20 convince China to let the yuan “float.” Policymakers seem to accept that an increase in the currency’s purchasing power will help consumers as part of the transition to consumer led growth.

IMF says the yuan is “fairly valued.”

The yuan is devalued by 4% and is made more reliant on market forces in the context of an imminent rate hike by the Fed and low export numbers.

Source: Federal Reserve Bank of St. Louis, Wall Street Journal, Bloomberg

1

2

3

4

5

6

7

8

44

US DOMICILED MUTUAL FUNDS

DUBLIN DOMICILED UCITS FUNDS

CASH BALANCEPayden/Kravitz Cash Balance Plan Fund

EQUITYEquity Income Fund

GLOBAL FIXED INCOMEEmerging Markets Bond FundEmerging Markets Corporate Bond FundEmerging Markets Local Bond FundGlobal Fixed Income Fund Global Low Duration Fund

TAX-EXEMPT FIXED INCOMECalifornia Municipal Income Fund

US FIXED INCOMEAbsolute Return Bond FundCash Reserves Money Market FundCore Bond FundCorporate Bond FundFloating Rate FundGNMA FundHigh Income FundLimited Maturity FundLow Duration FundStrategic Income FundUS Government Fund

EQUITYWorld Equity Fund

FIXED INCOMEAbsolute Return Bond FundGlobal Emerging Markets Bond FundGlobal Emerging Markets Corporate Bond FundGlobal Government Bond Index FundGlobal High Yield Bond FundGlobal Inflation-Linked Bond Fund

Global Bond FundGlobal Short Bond FundSterling Corporate Bond Fund – Investment GradeUS Core Bond FundUSD Low Duration Credit Fund

LIQUIDITY FUNDSEuro Liquidity FundSterling Reserve FundUS Dollar Liquidity Fund

For more information about Payden & Rygel’s, contact us at a location listed below.

LOS ANGELES 333 South Grand Avenue Los Angeles, California 90071 213 625-1900

BOSTON 265 Franklin StreetBoston, Massachusetts 02110617 807-1990

LONDON1 Bartholmew LaneLondon EC2N 2AX United Kingdom+ 44 (0) 20-7621-3000

PARISRepresentative Office54, 56 Avenue Hoche75008 Paris,France+ 33-607-604-441

PAYDEN.COM

LOS ANGELES | BOSTON | LONDON | PARIS

OVER 30 YEARS OF INSPIRINGC O N F I D E N C E W I T H A N UNWAVERING COMMITMENT TO OUR CLIENTS’ NEEDS.

45

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 101.1115

Committee: Finance and Budget Chairperson: Michael Rembis

Issue: Amend the contract with Health eConnex to provide optical character recognition (OCR) and

electronic data interchange (EDI) services for paper claim documents.

Please check all applicable: New Contract Amendment Sole Source

Preferred Vendor RFP/RFQ was conducted

Background: L.A. Care staff requests approval to amend the contract with Health eConnex in the

amount of $200,000 (total amount not to exceed $1,545,000) from December 31, 2015 to April 30, 2016. The vendor will continue to provide optical character recognition (OCR) and electronic data interchange (EDI) services for paper claims. Claim volumes have increased over budgeted projections. This amendment allows L.A. Care to continue to scan and capture data from paper claim documents. In 2013, L.A. Care sought to increase the quality of scanned claims data and reduce costs associated with processing these documents. A competitive request for proposal (RFP) was conducted at that time, and Health eConnex was chosen as the vendor with the best capability of providing OCR and EDI services. Claims volumes have surpassed the allotted budget; therefore additional funds are needed for the remainder of the contract. Currently, L.A. Care spends an average of $50,000 per month for EDI services.

Budget Impact: Sufficient funds are budgeted in the Claims Department for FY 2015-16.

Motion: To authorize staff to amend the contract with Health eConnex in the amount of $200,000 (total amount not to exceed $1,545,000) from December 31, 2015 to April 30, 2016 to provide optical character recognition (OCR) and electronic data interchange (EDI) services.

46

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 102.1115

Committee: Finance and Budget Chairperson: Michael Rembis

Issue: Amend a contract with Office Ally to continue to provide claims electronic data interchange

(EDI) services.

Please check all applicable: New Contract Amendment Sole Source

Preferred Vendor RFP/RFQ was conducted

Background: L.A. Care staff requests approval to amend a contract with Office Ally in the amount

of $240,000 from December 31, 2015 to June 30, 2016. The extension of this contract will allow L.A. Care to continue receiving electronic claims from Office Ally. Office Ally is L.A. Care’s largest electronic data interchange (EDI) claims clearinghouse and the exclusive clearinghouse for a majority of providers who submit electronic claims. L.A. Care conducted a competitive bid in May 2014 selecting Emdeon to replace Office Ally as our primary EDI vendor, offering the lowest transaction cost to handle EDI services. However, extensive delays are prolonging Emdeon’s implementation, which is not anticipated to be completed until late in the first quarter of 2016. This request allows L.A. Care to continue with Office Ally until the implementation and transition to Emdeon takes place.

Budget Impact: Sufficient funds are budgeted in the Claims department for FY 2015-16.

Motion: To authorize staff to amend a contract with Office Ally in the amount of $240,000 (total contract amount not to exceed $1,261,000), from December 31, 2015 to June 30, 2016 for inbound claims electronic data interchange services.

47

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 103.1115

Committee: Finance and Budget Chairperson: Michael Rembis

Issue: Amend contracts with Dickerson Employee Benefit Insurance Services (Dickerson) and

HealthCare Access Insurance Services (HCA) to support enrollment and retention services for L.A. Care Covered.

New Contract Amendment Sole Source

Preferred Vendor RFP/RFQ was conducted

Background: L.A. Care is currently contracted with General Agents to support new member

enrollment and retention for the L.A. Care Covered product line. In preparation for the 2016 L.A. Care Covered open enrollment period, staff has identified a need to increase funding for contracts with Dickerson and HealthCare Access. L.A. Care staff requests approval to amend the contract with Dickerson for $850,000 and HealthCare Access for $440,000 through September 30, 2016. The vendors will provide product education, outreach marketing support, and enrollment and retention services for individuals and small employer groups in all languages required to increase L.A. Care’s market share. In 2013, L.A. Care released a request for proposal (RFP) to select brokerage firms to represent the L.A. Care Covered product line. Both, Dickerson and HCA, were two of the four agencies selected to provide enrollment support for LACC. L.A. Care will conduct a competitive bid process for these vendors in 2016. Dickerson has 585 L.A. Care certified agents, and HealthCare Access 151 certified agents that have effectively engaged with consumers. The agencies are committed to supporting L.A. Care’s consumer outreach campaign and will continue to provide educational, outreach and enrollment support for L.A. Care Covered.

Budget Impact: Sufficient funds are budgeted in the Sales & Marketing Department budget for FY

2015-16.

Motion: To authorize staff to amend contracts with Dickerson Employee Benefit Insurance Services in the amount of $850,000 (total contract amount not to exceed $2,099,249) and HealthCare Access Insurance Services in the amount of $440,000 (total contract amount not to exceed $1,187,811), through September 30, 2016 to support enrollment and retention services for L.A. Care Covered.

48

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 104.1115

Committee: Finance & Budget Chairperson: Michael Rembis

Issue: Approval of Annual Investment Policy

Background: L.A. Care policy and procedure requires annual review and approval by the Finance

& Budget Committee of the Annual Investment Policy AFS-008 (previously FS-001) and the Desktop Procedure AFS.DP-008A. The following material changes were made to the policy which was last reviewed in October 2014:

1. The policy was updated to the new policy and procedures format established by the Compliance Department, which included the creation of the complementing Desktop Procedure AFS.DP-008A.

2. AFS.DP-008A Section 1.5.5 was revised to include provisions of California and Local Agency Obligations (Government Code Section 53601 (a), (c), (e)), which allows for investments in all State of California notes, regardless of rating. However, L.A. Care is maintaining a conservative approach and adding language to expand the allowable rating from AA to include all ranges of AA, AA3/AA-.

3. AFS.DP-008A Section 1.5.6 was revised to allow for investing in registered treasury notes or bonds of any of the other 49 United States in addition to California under (Government Code Section 53601 (d)).

4. AFS.DP-008A Section 1.5.16 was revised to allow for investing in supranational obligations (Government Code Section 53601 (q)). A Supranational is a multi-national organization whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in the member countries. L.A. Care has decided to take a conservative approach by allowing a maximum portfolio allocation not exceed 15%, despite the Government Code allowing for an amount not to exceed 30%.

Budget Impact: None.

Motion: To approve Financial Services Policy AFS-008 (Annual Investment Policy) and Desktop Procedure AFS.DP-008A, as submitted.

49

1 of 5

ANNUAL INVESTMENTS AFS-008

DEPARTMENT ACCOUNTING AND FINANCIAL SERVICES

CATEGORY DATES

PP-Mandated

PP-Non-Mandated

Effective Date 1/1/1996 Review Date ##/##/2015 Next Annual Review Date

##/##/2016

Legal Review Date

9/22/2015 C&Q/BOG Review Date

9/17/2014 BOG Motion # (if applicable)

FIN 100.1013

Supersedes Policy Number(s)

FIN-001, AS-001

LINES OF BUSINESS Medi-Cal – Plan Partners MCLA Cal MediConnect Internal Operations

Healthy Kids PASC-SEIU Plan L.A. Care Covered

ACCOUNTABILITY MATRIX

ATTACHMENTS

SUBJECT MATTER EXPERT NAME DEPARTMENT TITLE

Irene Lem Accounting and Financial Services

Controller

ELECTRONICALLY APPROVED BY THE FOLLOWING OFFICER DIRECTOR COMMITTEE CHAIR

NAME Tim Reilly Irene Lem DEPARTMENT Executive Services Accounting Services

TITLE Chief Financial Officer Controller

50

ANNUAL INVESTMENTS AFS-008

2 of 5

AUTHORITIES Government Code of Regulations (CCR), §§53600-53609 and 53646 Title 31, Code of Federal Regulations (CFR), §§306.1 et seq. and 350.0 et seq. L.A. Care Conflict of Interest Code L.A. Care Code of Conduct California Health & Safety Code §§1346(a)(11), 1375.1, and 1376 Knox Keene Health Care Service Plan Act of 1975, Ch. 2.2, §1340 et seq. of Div. 3 of the Health

& Safety Code, including the Rules of the DMHC

REFERENCES

AFS.DP-008A, “Annual Investments”

POLICY HISTORY

REVIEW DATE COMMENTS NEXT ANNUAL

REVIEW DATE

01/01/1996 New Policy 01/01/1997 04/01/2012 Annual review; primarily format changes 04/01/2013 02/28/2013 Annual review; primarily format changes 02/28/2014 09/11/2014 Annual review 09/11/2015

##/##/2015 Annual review; primarily format changes ##/##/2016

DESKTOP PROCEDURES

Desktop procedures are incorporated by reference in all L.A. Care policies

DEFINITIONS Please visit the L.A. Care intranet for a comprehensive list of definitions used in policies:

http://insidelac/ourtoolsandresources/departmentpoliciesandprocedures

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ANNUAL INVESTMENTS AFS-008

3 of 5

1.0 OVERVIEW:

1.1 To establish the investment guidelines for all operating funds and Board designated reserve funds of L.A. Care Health Plan (L.A. Care) invested on and after October 1st, 2015. The objective is to ensure L.A. Care’s funds are prudently invested according to the Board of Governors’ objectives to preserve capital, provide necessary liquidity, and to achieve a market average rate of return through economic cycles.

2.0 POLICY:

2.1 Investment of funds may only be made as authorized by this policy, which conforms to California Government Code (the Code) §53600 et seq., and complies with §1346(a)(11) and §1375.1 et seq. of the California Health & Safety code, specifically §1376, related to the operations of a licensed health service plan engaged in Medi-Cal, Medicare, and other programs, as well as to customary standards of prudent investment management. Should the provisions of the Code become more restrictive than those contained herein, such provisions will be considered immediately, incorporated into this policy, and appropriately adopted by the Board of Governors and L.A. Care management.

2.2 Investment Objectives: In accordance with the regulations cited herein, L.A.

Care’s primary annual investment objectives are in order of priority as follows: 2.2.1 Safety and Preservation of Capital – There are inherent risks associated

with any investment activities, including credit risk and market risk. 2.2.1.1 Credit risk will be mitigated through diversification of the

investment portfolio. 2.2.1.2 Market risk will be mitigated by matching maturity dates to

coincide, as much as possible, with L.A. Care’s cash flow requirements. It is explicitly recognized herein, however, that in a diversified portfolio, occasional capital losses are inevitable and must be considered within the context of the overall investment return.

2.2.2 Liquidity and Flexibility – The portfolio investments need to be comprised of investments for which there is a secondary market and which offer the flexibility to be sold at any time at prevailing market values with minimal risk of loss of principal and interest.

2.2.3 Total Return – L.A. Care’s portfolio will be designed to achieve a market

average rate of return similar to other authorized instruments and securities which have similar security, maturities and levels of risk.

2.3 Prudence

2.3.1 L.A. Care’s Board of Governors, Chief Financial Officer (CFO), and persons authorized to make investment decisions on behalf of L.A. Care

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ANNUAL INVESTMENTS AFS-008

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are trustees and fiduciaries subject to the Prudent Investor Standard, defined as follows: 2.3.1.1 The Prudent Investor Standard, as defined in Government Code

§53600.3, requires that when investment officials are investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing funds on behalf of L.A. Care, the investment officials shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of L.A. Care that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of L.A. Care. The Prudent Investor Standard shall be applied in the context of managing an overall portfolio.

2.3.1.2 L.A. Care’s investment professionals acting in accordance with this policy and any applicable written procedures shall be relieved of personal responsibility for an individual security’s credit risk or market risk.

2.4 Authority to Invest

2.4.1 The CFO shall have the authority to invest L.A. Care funds and manage the investment portfolio. Such authority is derived by order from the Board of Governors. 2.4.1.1 No person may engage in an investment transaction except as

provided herein and in the procedures established by the CFO and/or Board of Governors. The CFO may designate an investment manager(s) to manage all or such portions of L.A. Care’s funds as the CFO shall determine from time to time. Such investment manager(s) shall be subject to this policy and any directions provided by the CFO. The CFO will be responsible for all actions undertaken and shall establish a system on internal controls to regulate the activities of subordinate officials, including the investment manager.

2.5 Safekeeping, Performance Benchmarks, and Investment Activities

2.5.1 Ethics and Conflict of Interest 2.5.1.1 L.A. Care’s officers and employees involved in the investment

process or having authority or influence over such activities are not permitted to have any material financial interests in financial institutions that conduct business with L.A. Care, and they are not permitted to have any personal financial investment holdings that could be materially related to the performance of L.A. Care’s investments.

2.5.1.2 L.A. Care officers and employees involved in the investment of funds will follow applicable compliance policies related to

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ANNUAL INVESTMENTS AFS-008

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disclosure of potential conflicts to the extent the personal business activity or material financial interest is one capable of being known.

2.5.2 Other Investments 2.5.2.1 Any investments not specifically referred to herein or in

AFS.DP-008A, “Annual Investments” will be considered a prohibited investment.

2.6 Authorized Investments 2.6.1 Maturity and Term – All investments are subject to a maximum five

year maturity or term. 2.6.2 Eligible Instruments – L.A. Care’s policy is to invest in the high quality

instruments as permitted by the Government Code, subject to the limitations of this policy and its desktop procedures. For a complete list of the eligible investment instruments, please refer to AFS.DP-008A.

2.7 Diversification Guidelines 2.7.1 For all other securities described in AFS.DP-008A that are permitted

investments, no more than two percent of L.A. Care’s funds may be invested with any one company, corporation bank, local agency, or other investment vehicle, unless otherwise stated

2.7.2 L.A. Care’s investment manager(s), if any, must review the portfolio he/she manages to ensure compliance with L.A. Care’s diversification guidelines at the time of each purchase.

2.7.3 For more information, please refer to the “Diversification Guidelines” attachment.

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DESKTOP PROCEDURE AFS.DP-008A: ANNUAL INVESTMENT POLICY

Complements Policy AFS-008: Annual Investment Policy

The Annual Investment Policy AFS-008 establishes the investment guidelines for all Operating Funds and Board Designated Reserve Funds of L.A. Care Health Plan (“L.A. Care”) invested on and after September 1, 2014 (“Annual Investment Policy”). The objective of the Annual Investment Policy is to ensure L.A. Care’s funds are prudently invested according to the Board of Director’s objectives to preserve capital, provide necessary liquidity and to achieve a market average rate of return through economic cycles.

1.0 PROCEDURES: 1.1. Investment Objectives:

1.1.1. Safety and Preservation of Capital

1.1.1.1. Each investment transaction shall seek to ensure that the capital

losses are avoided due to market erosion of security value and institutional default or broker-dealer default. L.A. Care shall seek to preserve capital by mitigating the two types of risk, Credit Risk and Market Risk as follows: 1.1.1.1.1. Credit Risk will be mitigated through diversification

of the investment portfolio.

1.1.1.1.2. Market Risk will be mitigated by matching Maturity dates to coincide, as much as possible, with L.A. Care’s cash flow requirements. It is explicitly recognized herein, however, that in a diversified portfolio, occasional capital losses are inevitable and must be considered within the context of the overall investment return.

1.1.2. Liquidity and Flexibility

1.1.2.1. The portfolio investments need to be comprised of investments

for which there is a secondary market and which offer the flexibility to be sold at any time at prevailing market values with minimal risk of loss of principal and interest.

1.1.3. Total Return

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1.1.3.1. L.A. Care’s portfolio will be designed to achieve a market average rate of return similar to other authorized instruments and securities which have similar security, maturities and levels of risk.

1.2. Authority to Invest 1.2.1. The CFO may designate an Investment Manager(s) to manage all or such

portions of L.A. Care’s funds as the CFO shall determine from time to time. Such Investment Manager(s) shall be subject to this Annual Investment Policy and any directions provided by the CFO. The CFO will be responsible for all actions undertaken and shall establish a system on internal controls to regulate the activities of subordinate officials, including the Investment Manager.

1.3. Board of Governors & Finance and Budget Committee Oversight 1.3.1. Board of Governors

1.3.1.1. The CFO is responsible for providing the Board of Governors

with an Annual Investment Policy, and the Board of Governors is responsible for adopting the Annual Investment Policy and ensuring investments are made in compliance with the AFS-008, Annual Investment Policy. Investments will be made in recognition of L.A. Care’s need to comply with tangible net equity and other solvency and financial reporting requirements set forth by the Department of Managed Health Care. This Annual Investment Policy shall be reviewed and approved annually by the Board of Governors at a public meeting pursuant to Section 53646(a) (2) of the California Government Code.

1.3.1.2. The CFO is responsible for directing L.A. Care’s investment program and for compliance with this policy pursuant to the delegation of authority to invest funds or to sell or exchange securities. The CFO shall provide a quarterly report to the Board of Governors. The CFO shall also provide the Board of Governors with a monthly report of investment transactions.

1.3.1.3. Duties and responsibilities of the Finance and Budget Committee are distinct from those of the CFO as follows:

1.3.1.3.1. The CFO and staff are responsible for the day-to-day

management of L.A. Care’s investment portfolio and the making of specific investments.

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1.3.1.3.2. The Board of Governors is responsible for the Annual Investment Policy. The Finance and Budget Committee shall not make or direct L.A. Care management to make any particular investment, purchase any particular investment product, or do business with any particular investment companies or brokers. It shall not be the purpose of the Finance and Budget Committee to provide advice to the CFO on particular investment decisions of L.A. Care.

1.3.1.4. The duties and responsibilities of the Finance and Budget

Committee shall consist of the following:

1.3.1.4.1. Review of the Annual Investment Policy annually before its consideration by the Board of Governors and recommend revisions.

1.3.1.4.2. Review L.A. Care’s investment portfolio quarterly to confirm compliance with the Annual Investment Policy, including its diversification and maturity guidelines.

1.3.1.4.3. Provide comments to the CFO regarding potential investment and potential investment strategies.

1.3.1.4.4. Periodically review investment security diversification and investment strategies with Investment Manager(s).

1.3.1.4.5. Perform such additional duties and responsibilities as may be required from time to time by specific action and direction of the Board of Governors.

1.3.2. Quarterly Review

1.3.2.1. At a minimum, the CFO shall present a quarterly report with

investment transaction information in adequate detail to allow the Finance and Budget Committee to review the investment activities of L.A. Care.

1.3.2.2. The quarterly report will be summarized and presented as a

report from the Finance and Budget Committee to the full Board of Governors in accordance with Government Code Section 53646(b).

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1.3.3. Audit 1.3.3.1. Investment transactions of L.A. Care may be reviewed during

the annual audit performed by the public accounting firm selected by the Finance and Budget Committee and approved by the Board of Governors. The results of the audit of the investment transactions shall be presented in a report prepared by the auditors to the Finance and Budget Committee and the Board of Governors for their review, acceptance, and action as the Board of Governors deems necessary. A full audit of the investment of L.A. Care may be requested by the Finance and Budget Committee or Board of Governors at any time.

1.4. Safekeeping, Performance Benchmarks, and Investment Activities

1.4.1. Safekeeping

1.4.1.1. Investments purchased shall be held by a Custodian bank acting

as agent for L.A. Care and such custody agreement shall be in compliance with Government Code Section 53608.

1.4.2. Performance Benchmarks

1.4.2.1. L.A. Care’s investment portfolio shall be designed to achieve a

market-average rate of return through economic cycles similar to authorized investment instruments, which have similar security maturities and levels of risk.

1.4.2.2. The performance benchmarks for the investment portfolio will be based upon the market indices for short term investments of comparable risk and duration. These performance benchmarks will be agreed to by the CFO and the Investment Manager(s) and the relative performance of the investment portfolio will be reviewed with the Finance and Budget Committee quarterly.

1.4.3. Ethics and Conflict of Interest

1.4.3.1. L.A. Care’s officers and employees involved in the investment

of funds shall refrain from personal business activity that could conflict or engender the perception of conflict with the proper execution of the investment activities, or which could impair their ability to make impartial investment decisions.

1.4.4. Securities Lending

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1.4.4.1. Investment securities shall not be lent to an Investment Manager or Broker-Dealer.

1.4.5. Leverage

1.4.5.1. The investment portfolio, or investment portfolios managed by

an Investment Manager cannot be used as collateral to obtain additional investment funds

. 1.4.6. Underlying Nature of Investments

1.4.6.1. L.A. Care and its Investment Manager(s) shall not make

investments in organizations which have a line business which is visibly in conflict with public health or the mission of L.A. Care.

1.4.6.2. L.A. Care and its Investment Manager(s) shall not make investments in Negotiable Certificates of Deposit of a state or federal credit union if a member of its Board or Executive Officers also serves on the Board of Governors of that credit union.

1.4.6.3. L.A. Care will provide the Investment Manager (s) with a list of corporations that do not comply with the Annual Investment Policy and shall notify its Investment Manager(s) of any changes.

1.4.6.4. Investment Manager(s) will not enter into any investments with any institutions with which the Investment Manager is affiliated.

1.4.7. Derivatives

1.4.7.1. Investments in derivative securities are not allowed, except as permitted by this Annual Investment Policy, including but not limited to, US Treasury STRIPS as discussed in Section 1.5.3.

1.4.8. Rating Downgrades

1.4.8.1 L.A. Care may from time to time be invested in a security whose

rating is downgraded below the quality permitted in this Annual Investment Policy Desktop Procedure.

1.4.8.2 Any security held as an investment whose rating falls below the

investment guidelines or whose rating is put on notice for

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possible downgrade shall be immediately reviewed for action. The decision to retain the security until Maturity, sell or put the security, or other action shall be approved by the CFO.

1.4.9. Rating Guidelines

1.4.9.1. A security must be rated by a minimum of two rating agencies. If a security is rated by only two rating agencies, i.e., Standard & Poor’s, Moody’s or Fitch Ratings, the higher of the two ratings will apply. If a security has three ratings, the middle rating will apply.

1.4.9.2. Notwithstanding the Section 1.4.9.1, LA Care may invest in Government Pooled Funds that invest only in high grade securities or obligations.

1.4.10. Investment Manager 1.4.10.1 The CFO may designate an Investment Manager(s) to manage

any portion of the investment portfolio. Any designated Investment Managers shall be a fiduciary subject to the Prudent Investor Standard in Section 2.3.1.1 AFS-008, Annual Investment Policy, with respect to the funds under management. The CFO will:

1.4.10.1.1. Evaluate candidates for the role of Investment

Manager(s). The selected candidates will be reviewed and approved by the Chief Executive Officer (CEO), and Finance and Budget Committee and the Board of Governors.

1.4.10.1.2. Obtain certification from outside Investment Managers that they will purchase securities from broker-dealers (other than themselves) or financial institutions in compliance with Government Code Section 53601.5 and the AFS-008, Annual Investment Policy.

1.4.10.1.3. Provide all Investment Manager(s) with a copy of the AFS-008, Annual Investment Policy and Desktop Procedure which will be included in the Investment Manager’s contract.

1.4.10.1.4. Establish and review the targeted average maturities periodically with the Investment Manager(s).

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1.4.10.1.5. Review the investment diversification and portfolio

performance monthly to ensure that the Investment Manager’s compliance with this policy, risk levels and returns are reasonable, and that investments are diversified according to the policy.

1.4.10.1.6. Investigate any investment made by the Investment Manager(s) which is not authorized by the policy for possible cause for termination of contract.

1.5. Authorized Investments

1.5.1. Maturity and Term

1.5.1.1. All investments are subject to a maximum five (5) year

Maturity or Term.

1.5.2. Eligible Instruments 1.5.2.1. L.A. Care’s Policy is to invest in the high quality instruments as

permitted by the Government Code, subject to the limitations of the AFS-008, Annual Investment Policy and Desktop Procedure.

1.5.3. U.S. Treasuries (Government Code Section 53601(b))

Types of US Treasuries Description

Treasury Bills 3 months, 6 months, and one year securities and traded at a discount.

Treasury Notes and Bonds

Interest bearing instruments issued with maturities’ of 2 to 30 years

Treasury STRIPS US Treasury securities that have been separated into their component parts of principal and interest payments and recorded as such in the Federal Reserve book-entry record keeping system.

US Treasury coupon and principal STRIPS

These are not to be considered to be derivatives for the purpose of the AFS-008, Annual Investment Policy and are permitted investments.

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1.5.3.1. Maximum Term: Five (5) Years

1.5.4. Federal Agencies and US Government Sponsored Enterprises (Government Code Section 53601(f)) 1.5.4.1. These are U.S. Government related organizations, the largest of

which are federal intermediaries assisting credit markets, and are often simply referred to as “Agencies.” Any Federal Agency and U.S. Government Sponsored Enterprise security not specifically listed below is not a permitted investment instrument.

1.5.4.2. Maximum Term: Five (5) Years

“Agencies” are limited to:

Federal Agriculture Mortgage Association FRMDN

Federal Home Loan Banks FHLB

Federal Home Loan Mortgage Corporation FHLMC

Federal National Mortgage Association FNMA

Federal Farm Credit Banks FFCB

Student Loan Marketing Association SLMA

Government National Mortgage Association GNMA

Small Business Administration SBA

Export-Import Bank of the United States Ex-Im Bank

U.S. Maritime Administration MARAD

U.S. Department of Housing and Urban Developments HUD

Tennessee Valley Authority TVA

1.5.5. State of California and Local Agency Obligations (Government Code Sections 53601(a), (c), (e))

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1.5.5.1. Such obligations must be rated A-1, P-1, or equivalent or better short term; or Aa3/AA- or better long term, by a nationally recognized rating agency. Public agency bonds issued for private purposes (industrial development bonds) are specifically excluded as permitted investments.

1.5.5.2. Maximum Term: Five (5) Years

1.5.6. Other States’ Obligations (Government Code Sections 53601(d)

1.5.6.1. Other states’ obligations are permitted provided that:

1.5.6.1.1. Registered treasury notes or bonds of any of the

other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California. However, ownership of out of state local agency bonds is not allowed.

1.5.6.1.2. Such obligations must be rated A-1, P-1, or equivalent or better short term; or AA/Aa2 or better long term, by a nationally recognized rating agency.

1.5.6.2. Maximum Term: Five (5) Years

1.5.7. Bankers’ Acceptances (BA) (Government Code Section 53601(g)) 1.5.7.1. These short term notes are sold at a discount, and are

obligations of the drawer (the bank’s trade finance client) as well as the bank. Once accepted, the bank is irrevocably obligated to pay the BA upon Maturity if the drawer does not pay.

1.5.7.2. Eligible Bankers’ Acceptances are Bankers’ Acceptances that

are eligible for purchase by the Federal Reserve System, and

1.5.7.3. Drawn on and accepted by a bank rated F1 or better by Fitch, or are rated A-1 for short-term deposits by Standard and Poor’s or P-1 for short-term deposits by Moody’s, or are comparably rated by a nationally recognized rating agency.

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1.5.7.4. No more than five percent (5%) of L.A. Care’s investment funds may be invested in any one commercial bank.

1.5.7.5. Maximum Term: 180 days

1.5.8. Commercial Paper (Government Code Section 53601(h)) 1.5.8.1. Commercial Paper is negotiable, although it is usually held to

Maturity. The maximum Maturity is 270 days with most Commercial Paper issued for terms of less than 30 days.

1.5.8.2. Investments in Commercial Paper must be:

1.5.8.2.1. Rated P-1 by Moody’s or A-1 or better by Standard

and Poor’s 1.5.8.2.2. Issued by corporations with a rating or ratings A-3

by Moody’s and A- by Standard & Poor’s or better on long term debt, if any, and

1.5.8.2.3. Issued by U.S. corporations or non-U.S. corporations organized and operating within the United States and having total assets in excess of five hundred million dollars ($500,000,000).

1.5.8.2.4. Asset backed Commercial Paper issued by special purpose vehicles (structure investment vehicles) are prohibited.

1.5.8.3. L.A. Care’s investment funds may not be used to purchase more than ten percent (10%) of the outstanding Commercial Paper issued by any single issuer.

1.5.8.4. Maximum Term: 270 days

1.5.9. Negotiable Certificates of Deposit (CD) / Time Deposits

(Government Code Sections 53601(i)) 1.5.9.1. Negotiable Certificates of Deposit must be issued by a

nationally or state charged bank or savings association, state or federal credit unions or by a state licensed branch of a foreign bank, which have been rated as F1 or better by Fitch, or rated as A-1 for short-term deposits by Standard & Poor’s or P-1 for short-term deposits by Moody’s, or comparably rated by a

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nationally recognized rating agency. No investment shall be made in Negotiable Certificates of Deposit issued by a state or federal credit union if an Investment Official also serves on the board of directors, or any committee appointed by the board of directors, or the credit committee or the supervisory committee of the state or federal credit union issuing the Negotiation Certificate of Deposit.

1.5.9.2. Maximum Term: Negotiable CD’s 270 days

1.5.9.3. Maximum Term: Time Deposit 2 days

1.5.10. Repurchase Agreements (Government Code Section 53601(j))

1.5.10.1. Repurchase Agreements are permitted provided that: 1.5.10.1.1. The terms of the agreement does not exceed one

year. 1.5.10.1.2. Repurchase Agreements are permitted if

collateralized by U.S. Agencies or U.S. Treasuries with any registered broker-dealer or commercial bank insured by the FDIC so long as at the time of the investment:

1.5.10.1.3. Such registered broker-dealer is a recognized

primary dealer, and

1.5.10.1.4. Such primary broker-dealer (or its parent) has an uninsured, unsecured and unguaranteed obligation rated P-1 short term or A-2 long term or better by Moody’s and A-1 short term or A long term or better by Standard & Poor’s.

1.5.10.2. A broker dealer master Repurchase Agreement must be signed

by the Investment Manager (acting as “Agent”) and approved by the Investment Professional prior to entering into any repurchase transaction.

1.5.10.3. The securities are held free and clear of any lien by L.A. Care’s

Custodian or Agent for the Custodian, and such third party is a:

1.5.10.3.1. Federal Reserve Bank, or

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1.5.10.3.2. A bank which is a member of the Federal Deposit Insurance Corporation (FDIC) and which has a combined capital surplus and undivided profits of not less than $50 million and the Custodian shall have received written confirmation from such third party that it holds such securities, free and clear of any lien, as Agent for L.A. Care’s Custodian, and

1.5.10.3.3. A perfected first security interest under the Uniform Commercial Code, or book entry procedures prescribed at 31 C.F.R. 306.1 et seq., or 31 C.F.R 350.0 et seq. in such securities is created for the benefit of L.A. Care’s Custodian.

1.5.10.4. The Agent must provide L.A. Care’s Custodian and Investment

Professionals with a valuation of the collateral securities value no less frequently than weekly and shall liquidate the collateral securities if any deficiency in the required one hundred and two percent (102%) collateral percentage is not restored within two business days of such valuation.

1.5.10.5. Maximum Term: One (1) year 1.5.10.6. Reverse Repurchase Agreements are not allowed

1.5.11. Medium Term Maturity Corporate Securities (Government Code

Section 53601(k)) 1.5.11.1. Medium Term Maturity Corporate Securities are corporate and

depository institution debt securities with a maximum remaining maturity of five years (5) or less. Medium Term Maturity Corporate Securities must:

1.5.11.1.1. Be Corporate Securities that have a rating of A2 by

Moody’s and A by Standard and Poor’s or better with a Maturity of five (5) years or less,

1.5.11.1.2. Be issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or by any state and are operating within the United States that have total assets in excess of five hundred million dollars ($500,000,000),

1.5.11.1.3. Represent no more than five percent (5%) of the issue in the case of a specific public offering. This limitation does not apply to debt that is

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“continuously offered” in a mode similar to Commercial Paper. ( i.e., medium term notes (MTN’s) ),

1.5.11.1.4. Represent no more than 5% of the portfolio for both MTN’s or any corporate security of any one corporate issuer.

1.5.11.2. Maximum Term: Five (5) years

1.5.12. Money Market and Mutual Funds (Government Code Section 53601(l)

1.5.12.1. Investments in shares of beneficial interest issued by diversified management companies (Money Market Funds or Mutual Funds) must be with a company that:

1.5.12.1.1. Attained the highest ranking of the highest letter and

numerical rating provided by not less than two nationally recognized rating services, or

1.5.12.1.2. If unrated, all funds must be invested 100% in government securities or securities backed by government collateral.

1.5.12.1.3. Any investments in a Mutual Fund must be with a Mutual Fund that invests in the securities and obligations authorized by Government Code Sections 53601(a) to (k), inclusive, and (m) to (o), inclusive.

1.5.12.1.4. Any investments in a Money Market Fund must be with a Money Mutual Fund that follows regulations specified by the SEC under the Investment Company Act of 1940.

1.5.12.1.5. Not more than ten percent (10%) of L.A. Care’s investment funds may be invested in any one Mutual Fund.

1.5.13. Mortgage or Asset Backed Securities (Government Code Section 53601(o))

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1.5.13.1. Though these securities may contain a third-party guarantee, they are a package of assets being sold by a trust, not a debt obligation of the sponsor. Other types of “backed” debt instruments have assets (such as leases or consumer receivables) pledged to support the debt service. However, Mortgage Backed Securities primarily backed by sub-prime collateral are not allowed.

1.5.13.2. Investments in any Mortgage Pass-Through Securities,

collateralized Mortgage Obligations, Mortgage Backed or other pay through bond, equipment lease backed certificate, consumer receivable pass through certificate, or consumer receivable backed bonds must be:

1.5.13.2.1. Rated AA by a nationally recognized rating service,

and

1.5.13.2.2. Issued by an issuer having an A or better rating service by a nationally recognized rating service for its long term debt.

1.5.13.3. Maximum Term: Five (5) years

1.5.14. Variable and Floating Rate Securities 1.5.14.1. Variable and Floating Rate Securities are an appropriate

investment when used to enhance yield and reduce risk. They should have the same stability, Liquidity and quality as traditional market securities.

1.5.14.2. Variable and Floating Rate Securities with a final Maturity not

to exceed five (5) years as described above, must utilize traditional Money Market asset indices such as U.S. Treasury Bills, Federal Funds, Commercial Paper or LIBOR. Investment in Floating Rate Securities whose reset is calculated using more than one of the above indices are not permitted, i.e., dual index notes.

1.5.14.3. No investments shall be made in inverse floaters, range notes,

interest-only strips derived from mortgage pools, and securities that could result in zero-interest accrual if held to maturity. Zero-interest accruals means the security has the potential to realize zero interest depending upon the structure of the security. Zero coupon bonds and similar investments that start

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at a level below the face value are permissible because the value does increase.

1.5.15. Government Pooled Funds (Government Code Section 53601(p))

1.5.15.1. Investments are permitted in Government Pooled Funds

including, but not limited to, County Pooled Investment Funds, Joint Powers Authority Pools, the Local Agency Investment Fund, and the Voluntary Investment Program Fund.

1.5.15.2. A Joint Powers Authority Pool must retain an investment

advisor who is registered with the SEC (or exempt from registration), has assets under management in excess of $500 million, and has at least five years experience investing in instruments authorized by Government Code Sections 53601(a) to (o).

1.5.15.3. Any investments in the Voluntary Investment Program Fund

must be between $200 million and $10 billion dollars and must be approved by the Board of Governors.

1.5.15.4. For any investments in the Local Agency Investment Fund or

County Pooled Investment Fund, the CFO may provide to the Board of Governors and the auditor the most recent statement or statements received from those institutions in lieu of the information otherwise required to be provided in the quarterly reports pursuant to Section 1.3.2.2 of this Annual Investment Policy Desktop Procedure.

1.5.15.5. Maximum Term: Five (5) years (per Government Code

Section 53601)

1.5.16. Supranational Obligations (Government Code Section 53601(q)) 1.5.16.1. Certain supranational obligations are permitted provided that

the obligations are:

1.5.16.1.1. U.S. Dollar denominated, 1.5.16.1.2. Senior Obligations,

1.5.16.1.3. Issued or unconditionally guaranteed by the

International Bank for Reconstruction and

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Development, International Finance Corporation, or Inter-American Development Bank,

1.5.16.1.4. Eligible for purchase and sale within the United States, and

1.5.16.1.5. Rated AA or better by a nationally recognized rating agency.

1.6. Diversification Guidelines 1.6.1. Investment Security Diversification at the time of purchase:

Type of Security Maximum Portfolio %

US Treasuries, including STRIPS 100%

Federal Agencies, and US Government Enterprises 100%

State Obligations (CA and others) and CA Local Agency Obligations

Bankers Acceptances

25%

40%

Commercial Paper 25%

Negotiable Certificates of Deposit 30%

Repurchase Agreements 100%

Medium Term Maturity Corporate Securities 30%

Money Market Funds and Mutual Funds Combined 20%

Mortgage and Asset Backed Securities 20%

Variable and Floating Rate Securities

Government Pooled Funds

Certain Supranational Obligations

50%

100%

15%

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1.6.2. Issuer / Counterparty Diversification Guidelines:

Issuer / Counterparty Maximum Portfolio %

Any one Federal Agency or Government Sponsored Enterprise

100%

Any one Repurchase Agreement counterparty name:

If Maturity / Term is less than or equal to 7 days 50%

If Maturity / Term is greater than 7 days 25%

1.6.3. For all other securities described under Authorized Investments that are permitted investments, no more than two percent (2%) of L.A. Care’s funds may be invested with any one company, corporation bank, local agency, or other investment vehicle, unless otherwise stated

1.6.4. L.A. Care’s Investment Manager(s) (if any) must review the portfolio he/she manages to ensure compliance with L.A. Care’s Diversification guidelines at the time of each purchase.

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 105.1115

Committee: Finance & Budget

Chairperson: Michael Rembis

Issue: Execute a contract with a vendor to purchase eProcurement and Contract Management software,

implementation, and support services.

New Contract Amendment Sole Source Preferred Vendor RFP/RFQ was conducted

Background: L.A. Care staff requests approval to execute a contract with either, Ivalua or SciQuest, to

purchase eProcurement and Contract Management software, implementation and support services, from an estimated start date of January 1, 2016 to December 31, 2018, for a total amount not to exceed $1,700,000.

L.A. Care needs an eProcurement and Contract Management system for procurement and contract management to better manage contracts with an integrated contract repository for L.A. Care, a single point of entry online for purchasing requisitions, contracts, and purchase orders, vendor and provider qualification capability, and electronic invoice processing. Provider Network Operations (PNO) currently has no contract management system in place. The system will provide specific contracting requirements for procurement and PNO, in order to better manage contract expirations; approvals; and oversee invoice and payments.

The vendor will provide L.A. Care with eProcurement and Contract Management software licenses, install the software, and provide ongoing support to make sure it is functioning according to L.A. Care’s specifications. The estimated solution is to be implemented in phases by the second quarter of 2016.

RFP Process In July 2015, a request for proposals was issued to seven software vendors that were selected from market research reports and internal expertise. L.A. Care received proposals from four vendors: Ariba (SAP), Coupa, Ivalua and SciQuest. After an extensive review of the proposals and on-site presentations, an L.A. Care evaluation team comprised of Procurement, PNO, Legal Services and Information Technology (IT) staff selected two finalists based upon software functionality, user friendliness, interface capability, implementation expertise, and cost. The two finalist vendors are Ivalua and SciQuest. The L.A. Care team is conducting further evaluation of the finalists’ solutions, reviewing the scopes of work, pricing and contract review.

Implementation The selected vendor, and possibly other third party vendors, will provide implementation services including project management, installation, configuration, integration, data migration, customization, testing, training, documentation, and post implementation support.

The software will be Cloud hosted with no hardware purchase required, and a preliminary review was completed for both vendors on compliance, cloud security, reliability, disaster recovery, and interface requirements.

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Board of Governors

MOTION SUMMARY

Cost After preliminary negotiation of cost for licenses and scoping, the total three year cost as proposed by the two finalist vendors is estimated to be up to $1,700,000, including software, annual support, and implementation. L.A. Care is still in negotiations for further reductions to the proposed cost, so a request is made for authorization up to $1,700,000. Cost in FY 2015-16 is not expected to exceed $1,000,000, with annual costs for Year 2 and Year 3 not to exceed $350,000 each. The start date will be finalized when the contract is executed.

Budget Impact: $1,000,000 is included in the FY15-16 Accounting Department Budget. Sufficient funds for the eProcurement and Contract Management software and support services will be included in future fiscal year budgets for Accounting and Financial Services. Motion: To authorize staff to execute a contract with a vendor, and potentially

other third party vendors still to be determined, to implement eProcurement and Contracting software for a total amount not to exceed $1,700,000, for an estimated contract term of January 2016 through December 31, 2018.

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 106.1115

Committee: Finance and Budget Chairperson: Michael Rembis

New Contract Amendment Sole Source

Preferred Vendor RFP/RFQ was conducted

Issue: Execute a contract with Cognizant to provide professional services to streamline L.A. Care’s

Extended Delegated Authorization process.

Background: L.A. Care staff requests approval to execute a contract with Cognizant through September

30, 2016 in the amount of $633,880. The vendor will provide professional services to streamline and rectify workflow problems associated with the extended delegated authorization process.

L.A. Care’s current delegated authorization approach needs critical improvements to allow the organization to adjudicate claims within required deadlines. The vendor will assist L.A. Care in incorporating features and capabilities that align with L.A. Care’s current and future business needs. The vendor will provide L.A. Care with the following services:

Detailed Project Plan

Detailed business and technical requirements document

Solutions document

Unit test scripts

System Integration Testing

UAT sign off document

Other services to support the contract work plan.

A request for proposal (RFP) was not conducted for these services. Cognizant is considered a sole source vendor with in-depth technical knowledge of L.A. Care’s applications in various projects across all lines of business. Cognizant is currently assisting L.A. Care with ICD-10 and Care Advance implementations. Their knowledge and expertise requires minimal training allowing them to easily immerse themselves into the project, allowing greater efficiency, time and cost savings. The vendor is a leader in providing services to the health care and information technology industries.

Budget Impact: Sufficient funds are budgeted in the Information Technology budget for FY 2015-16.

Motion: To authorize staff to execute a contract with Cognizant in the amount of $633,880, through September 30, 2016 for professional services to streamline the current extended delegation model and support the expansion of this process.

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 107.1115

Committee: Finance and Budget Chairperson: Michael Rembis

Issue: Amend a contract with FlexTech to increase the amount of the contract from $1,500,000 to

$3,000,000 to cover additional FlexTech staffing utilized in FY15, originally allocated to be used for HCL consultants.

New Contract Amendment Sole Source

Preferred Vendor RFP/RFQ was conducted

Background: At the June 4, 2015 Board of Governors meeting, motion FIN 107.0615 was

approved. The motion requested approval to execute contracts with the following existing key vendors: Cognizant, FlexTech, HCL, and Infosys for ongoing and new professional services. The motion allocated $1,500,000 to each vendor for a total amount of $6,000,000. Staff requests that the amount of $1,500,000 originally allocated towards the HCL vendor be realigned to the FlexTech contract. At the time the motion was written, the precise apportionment of budget dollars to each vendor was unknown and therefore was spread evenly between the vendors. As the work progressed, requirements dictated that FlexTech be utilized more heavily due to its expertise and involvement in various projects. The HCL consultants were not employed. The result of this reallocation of resources is over-funding for HCL and underfunding for FlexTech.

Budget Impact: Sufficient funds are available in the Information Technology Department Strategic

Projects budget for FY 2015-16.

Motion: To authorize staff to amend a contract with FlexTech to reallocate $1,500,000 from HCL for Information Technology staff augmentation services (total contract not to exceed $3,000,000).

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 108.1115

Committee: Finance and Budget Chairperson: Michael Rembis

Issue: Execute a contract with Infosys Public Services (Infosys) for professional services to support L.A.

Care’s QNXT environment setup, QNXT- Clinical Care Advance (CCA) application installations, configurations, and maintenance.

New Contract Amendment Sole Source Preferred Vendor RFP/RFQ was conducted

Background: L.A. Care requests approval to execute a contract with Infosys through September 30,

2016 in an amount not to exceed $600,000. The vendor will provide support services for L.A. Care’s QNXT environment setup, QNXT-Clinical Care Advance (CCA) application installations, configurations, and maintenance. These services are needed to successfully complete L.A Care’s Core System Project (CSP Plus). L.A. Care has used this vendor since 2013 for similar services, including QNXT configuration support for ICD-10 testing of several lines of business. A request for proposal (RFP) was not conducted for these services; Infosys is considered a sole source vendor. The vendor’s current knowledge, familiarity with L.A. Care’s QNXT system, and strategic partnership with TriZetto makes Infosys the leading vendor to provide these services. Infosys’s knowledge and expertise requires minimal training, which allows for time and cost savings. Staff worked with the vendor to negotiate rates for this project, and a variability of 5% increase in work requested was agreed to be absorbed by the vendor per month at no additional cost to L.A. Care.

Budget Impact: Sufficient funds are allocated in the Information Technology budget for FY 2015-16.

Motion: To authorize staff to execute a contract with Infosys Public Services in the amount not to exceed $600,000 through September 30, 2016, to provide professional services for L.A. Care’s QNXT environment setup, QNXT- Clinical Care Advance (CCA) application installations, configurations, and maintenance.

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 109.1115

Committee: Finance and Budget

Chairperson: Michael Rembis

New Contract Amendment Sole Source Preferred Vendor RFP/RFQ was conducted

Issue: Authorize spending with Cognizant, FlexTech, and Infosys, HCL for professional services to

support various Information Technology (IT) efforts during FY 2015-16.

Background: On June 4, 2015 the Board of Governors approved motion FIN 107.0615; it requested

approval to negotiate contracts with Cognizant, FlexTech, and Infosys, HCL, following a competitive bidding process. Since the approval of the motion, Master Services Agreements (MSAs) were/are being negotiated and executed with each of these vendors, setting forth competitive billing Rate Cards, Work Order procedures, and other terms through 2017.

Staff requests approval to authorize spending against the existing MSAs for FY 2015-16, in an aggregate amount not to exceed $15,000,000 for staff augmentation expenditures among the four vendors. The exact amount to be distributed among each vendor is unknown at this time. Staff augmentation is needed to ensure continuity and completion of projects currently underway and approved in the budget for FY 2015-16.

The approved budget for Strategic Projects FY 2015-16 includes $43.3 million in Information Technology Strategic Projects, which includes staffing augmentation, professional fees and capitalized equipment. A number of Strategic Projects are carried forward from last year, such as the Core System Project, while others are new and in various states of readiness for resourcing, which will occur through staff augmentation and/or fixed-price competitive bids, as appropriately determined for each project.

The total budget impact of this recommendation is based on IT’s department maximum obligation estimate for FY 2014-15 and intended allocations for FY 2015-16:

Vendors Estimated Maximum Obligation FY 2014-15 Tentative Allocation FY 2015-16

Cognizant $ 3,000,000 $2,000,000 - $4,000,000

Infosys $ 8,000,000 $2,000,000 - $4,000,000

FlexTech $ 3,000,000 $5,000,000 - $7,000,000

HCL $ 1,000,000 $2,000,000 - $4,000,000

TOTAL: $15,000,000 $15,000,000

Budget Impact: Sufficient amounts have been budgeted in the Information Technology department

for FY 2015-16.

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Board of Governors

MOTION SUMMARY

Motion: To authorize spending with the following existing key vendors: Cognizant, FlexTech, HCL and Infosys in an aggregate amount not to exceed $15,000,000 for staff augmentation expenditures through September 30, 2016.

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 110.1115

Committee: Finance & Budget Chairperson: Michael Rembis

Issue: Accept and delegate authority to execute a Transforming Clinical Practice Initiative (TCPI)

Practice Transformation Networks (PTN) grant from Centers for Medicare & Medicaid Services (CMS).

New Contract Amendment Sole Source

Preferred Vendor RFP/RFQ was conducted

Background: TCPI was created by CMS to help clinicians achieve large-scale health transformation.

TCPI is designed to support more than 140,000 clinician practices over four years in sharing, adapting, and developing comprehensive quality improvement strategies. TCPI is part of a strategy advanced by the Affordable Care Act to strengthen the quality of patient care and spend health care dollars wisely.

In October 2014, the Funding Opportunity Announcement (CMS-1L1-15-003) for TCPI was released with a maximum amount of $685,000,000 for all award recipients. In response to the notice, L.A. Care submitted an application in February 2015 to help L.A. County primary care providers, behavioral health specialists, and other providers as appropriate transform their practices to improve care for patients with diabetes and/or depression. CMS announced on September 29, 2015 that 39 organizations across the country were awarded grants, including L.A. Care. L.A. Care’s award is for $15,800,000 over four years, starting September 29, 2015, to help 3,100 L.A. County primary care and behavioral health providers. Funding is approved by CMS annually.

L.A. Care will use grant funds for on-the-ground practice coaching delivered through Network Partners and Service Partners to support providers, using a data-driven PDSA approach. Network Partners will engage providers, manage the program for their network, provide on-the-ground coaches, and collect data. Service Partners will provide additional on-the-ground coaching to providers.

Authorization is requested to execute subcontracts with Community Clinic Association of Los Angeles County (CCALAC), Department of Mental Health (DMH), AltaMed, Adventist Health, Citrus Valley, Object Health, LA NET, and other vendors as appropriate to support the program. Additional vendors include a Support and Alignment Network (SAN) to implement learning collaboratives to ensure consistent progress across all participating providers; an organization to train coaches; and a vendor to provide software and services for data collection and reporting. Contracts will be required for the duration of the program with several organizations serving in each role:

Network Partners: CCALAC, DMH, AltaMed, Adventist Health, Citrus Valley

Service Partners: Object Health, LA NET

Additional vendors include Network for Regional Healthcare Improvement (NRHI), National Resource Center for Academic Detailing (NaRCAD), and a data collection software company to be determined

Network Partners, Service Partners, and other vendors are sole source; so requests for proposals were not distributed. Longstanding, successful partnerships have been in place between L.A. Care and Network and Service Partners on related programs. Selection of the data collection software company

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Board of Governors

MOTION SUMMARY

through a RFP process is currently underway. NRHI and NaRCAD are funded under other programs to perform services; and L.A. Care will only pay for their travel expenses.

L.A. Care staff requests approval to: 1. Accept the grant from CMS in the amount of $15,800,000 over four years conditional upon

CMS funding, with an approximate period of performance September 29, 2015 to September 28, 2019,

2. Delegate authority to execute the grant, allowing L.A. Care to serve 3,100 L.A. County primary care providers, behavioral health specialists, and other providers as appropriate,

3. Execute subcontracts for up to $11,500,000 collectively with CCALAC, DMH, AltaMed, Adventist Health, Citrus Valley, Object Health, LA NET, and other vendors as appropriate to support the program.

Budget Impact: No budget impact. Award funding will support all associated expenses of the

program.

Motion: To authorize L.A. Care to accept a grant from Centers for Medicare and Medicaid Services (CMS) in the amount of $15,800,000, conditional upon CMS funding, for the approximate period of September 29, 2015 to September 28, 2019 for L.A. Care to provide practice transformation support to 3,100 L.A. County primary care providers, behavioral health specialists, and other providers as appropriate; and delegate authority to execute subcontracts for up to $11,500,000 collectively, with Community Clinic Association of Los Angeles County (CCALAC), Los Angeles County Department of Mental Health (DMH), AltaMed, Adventist Health, Citrus Valley, Object Health, LA NET, and other vendors as appropriate to support the program.

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. ECA 100.1115

Committee: Executive Community Advisory

Chairperson: Elda Sevilla

Issue: Approval of additional member (s) to the Regional Community Advisory Committees (RCACs)

and Coordinated Care Initiative (CCI) Demonstration Project Councils.

Background: Senate Bill 2092 requires that L.A. Care Health Plan ensure community involvement

through a Community Advisory Committee. L.A. Care’s Regional Community Advisory Committee (RCAC) structure is composed of 5-35 members per RCAC. RCAC member recruitment is on-going to ensure the highest possible community involvement. L.A. Care Health Plan developed a Memorandum of Understanding (MOU) with the State of California ensuring that seniors and people with disabilities who are participants in the Coordinate Care Initiative (CCI) Demonstration Project also known as CalMedi-Connect are provided an opportunity to participate in L.A. Cares consumer stakeholder committees and processes. The Coordinated Care Initiative (CCI) Consumer Councils structure is composed of up to 11 members to ensure the highest possible community involvement and feedback.

Budget Impact: None.

Motion: To approve the following candidate(s) to the Regional Community Advisory Committees (RCAC), and Coordinated Care Initiative Councils (CCI) as reviewed by the Executive Community Advisory Committee (ECAC) during the October 14, 2015 ECAC meeting.

Name RCAC/CCI Area Council #

Type of Member (Agency, if applicable)

Ramona Torres CCI Area 2 Consumer

Arsine Grigoryan RCAC 4 Consumer

Raul Montes RCAC 8 Consumer

Petra Fernandez RCAC 9 Consumer

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Board of Governors

MOTION SUMMARY

Date: November 5, 2015

Motion No. ECA 101.1115

Committee: Executive Community Advisory

Chairperson: Elda Sevilla

Issue: Coordinated Care Initiative (CCI) Council Chair and Vice Chair Elections.

Background: L.A Care Health Plan developed a Memorandum of Understanding (MOU) with

the State of California ensuring that seniors and people with disabilities who are participants in the Coordinate Care Initiative (CCI) Demonstration Project also known as CalMedi-Connect are provided an opportunity to participate in L.A. Cares consumer stakeholder committees and processes. The candidates listed below were elected by their individual CCI Councils during the month of September 2015.

Budget Impact: N/A Motion: To approve the elections of Marcia Ramos and Demetria Saffore as

Chair and Vice Chair of Coordinate Care Initiative (CCI) Council Area 1 for FY 2015-2016 as reviewed by the Executive Community Advisory Committee (ECAC) at the October 14, 2015 meeting.

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October 27, 2015

TO: Board of Governors

FROM: John Baackes, Chief Executive Officer

SUBJECT: CEO Report – November 2015

Please find below an update on organizational activities that occurred in October 2015. Additionalupdates will be made at the November 5, 2015 Board meeting.

1. Annual Board RetreatPlease find attached to my report a summary of the annual Board Retreat held on September 3,2015 at The California Endowment. Many thanks to Board members, L.A. Care staff, andmembers of the public for participating in the day-long retreat.

2. DMHC Approves of Blue Shield of California Acquisition of Care 1st Health PlanOn October 8, 2015, the Department of Managed Health Care (DMHC) issued a press releaseoutlining their approval of Blue Shield’s acquisition of Care 1st. The proposed merger wasreviewed by DMHC to ensure access to health services for patients, financial viability of theplan, organizational and administrative changes, and many other areas that could be impacted bythe transaction. Blue Shield committed to approximately $200 million in investments tostrengthen California’s health care delivery system and improve consumer assistance programs.With Care 1st being a subcontracted health plan to L.A. Care, staff also conducted a significantamount of due diligence prior to agreeing to assign Care 1st’s L.A. Care Medi-Cal agreement toBlue Shield, upon completion of the acquisition. Just prior to the closing of the BlueShield/Care 1st acquisition, L.A. Care and Care 1st entered into an extension of the L.A. Caresubcontract.

3. Vision to Learn Recognized by White House Initiative on Educational Excellence for HispanicsOn October 15, 2015, Vision to Learn was highlighted as one of the 2015 “Bright Spots inHispanic Education” as part of the White House Initiative on Educational Excellence forHispanics. The initiative recognizes programs that promote educational attainment for theHispanic community. L.A. Care has been involved in Vision to Learn in Los Angeles to deliverquality vision care to students in Title I schools. By providing free eye exams and glasses tochildren in need, students can come to school ready to learn. Congratulations to Vision to Learnand to the L.A. Care staff working on this program.

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4. Care Harbor LA at the Los Angeles Sports ArenaFor the fourth consecutive year, L.A. Care was presenting sponsor at Care Harbor LA and hadsignificant presence at the event. The one-of-a-kind clinic was held on October 15-18 at the LASports Arena. Prior to the event, all of the 4,000 wristbands available for the clinic were handedout to individuals seeking medical, dental, and vision care. New this year was a secondwristbanding location at Ted Watkins Park in Watts, which experienced a good turn-out. SeveralL.A. Care staff members were interviewed by media and Board Members Gamble, Horowitz,and Perez participated and/or volunteered at the event. Many thanks to staff and L.A. Care’sBoard for continuing to support Care Harbor LA.

5. New Advertising Campaigns for L.A. Care Covered Open EnrollmentOpen enrollment for Covered California is scheduled to begin on November 1, 2015 and willend January 31, 2016. L.A. Care has developed and will be activating an integrated advertisingand marketing campaign that includes print, outdoor, television, and radio programming.During the November 5 Board meeting, we plan to share some of the print and radio ads thatwill be in circulation in the coming days.

6. L.A. Care Receives Transforming Clinical Practice Initiative AwardThe federal Department of Health and Human Services recently announced L.A. Care as one of39 health care collaborative networks selected to participate in the Transforming ClinicalPractice Initiative. L.A. Care will receive up to $15 million over four years to provide technicalassistance support to practices in Los Angeles County to help approximately 3,000 providersexpand their quality improvement capacity, collaborative learning, and achieve common goals ofimproved care, better health outcomes, and reduce cost.

7. Operations Report and Update on FY 2014-2015 Strategic PrioritiesPlease find attached to my report an operations update from Jonathan Freedman, Interim ChiefOperating Officer and also, the year end FY 2014-2015 Strategic Priorities Performance Report.

8. Events of InterestOn October 20, 2015, I attended the annual meeting of the California Association of HealthPlans (CAHP) and participated in a panel discussion on the expansion and future of California’sMedicaid program.

On October 14, 2015, I met with the Senate Financing Committee Working Group on ChronicCare in Washington DC. This meeting was coordinated by the SNP Alliance, a trade associationserving special needs plans (of which L.A. Care is a member).

A Health Promoter Program training was held on October 2, 2015 at L.A. Care’s headquarters.The featured topic of discussion was diabetes.

In addition, I participated in several events and meetings this month including:

My Health LA Anniversary Reception – October 5, 2015

RCAC Region 10 Meeting – October 15, 2015

Eisner Women’s Health Center Ribbon Cutting – October 23, 2015

Please find attached to my report a listing of events that L.A. Care sponsored in October.

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Attachments:

October sponsorship list

Board Retreat summary memo

Operations report

FY 2014-2015 Strategic Priorities Performance Report

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October 2015 Participation and Sponsorship List

Event Date Organization Event Location

10/3/2015 Special Needs Network, Inc. Evening Under The Stars The Sony Picture Lot

10/3/2015Neighborhood Legal

Services of Los AngelesJust Neighbors Celebration Westin Pasadena

10/10/2015 EL ARCALupita Infante Benefit

ConcertCity of Bell

10/11/2015L.A. Trust for Children's

HealthTooth Fairy Convention Exposition Park

10/15/2015 Downtown Women's Center Dinner With A Cause JW Marriott at LA Live

10/15/2015 Care HarborCare Harbor LA Healthcare

Clinic

Los Angeles Sports

Arena

10/15/2015California Primary Care

Association (CPCA)CPCA Annual Conference

Sacramento Convention

Center

10/17/2015 KJLH Radio Taste of SoulCrenshaw Blvd., Los

Angeles

10/21/2015 The City of Los Angeles Disability Mentoring Day City Hall

10/23/2015 JWCH Institute, Inc.Hand and Heart Wesley

BenefitCity Club Los Angeles

10/24/2015 Alzheimer's Association Walk to End Alzheimer's East Los Angeles

10/25/2015 Act TodayDenim and Diamonds

Annual Fundraiser

Four Seasons Hotel,

Westlake Village

10/29/2015Antelope Valley Partners for

HealthWellness Symposium

AVPH Conference

Center

10/29/2015 Center for Oral HealthCenter for Oral Health

Annual SymposiumThe Westin, LAX

10/29/2015California Black Health

NetworkHeroes in Health Marina del Rey Marriott

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October 27, 2015

TO: Board of Governors

FROM: John Baackes, Chief Executive Officer

SUBJECT: 2015 Board of Governors Retreat Summary

The Board of Governors annual retreat took place on September 3, 2015. The retreat focused onmarket trends, L.A. Care’s strategic priorities and organizational structure, and furthering thedevelopment of L.A. Care’s brand. A summary of the retreat can also be found in the minutes fromthe September 3 Board meeting.

The following questions were used to frame the retreat and discussions:1. How do the larger market trends of vertical integration, large scale mergers and acquisitions, and

increasingly consumer-driven markets impact L.A. Care?

2. How will reorganization improve accountabilities and help L.A. Care better manage complex

populations?

3. What is L.A. Care’s value proposition to members and providers and how can we modify our

branding to better reflect that value?

Steve Valentine, President of the Camden Group, presented on current healthcare trends. Hediscussed larger trends in California’s commercial, Medicaid, and Medicare markets, including theresults of Medi-Cal expansion, the duals demonstration, and the launch of California’s health benefitexchange. He noted that while L.A. Care retains higher market share than Health Net in the Medi-Cal market, we are not currently competitive in the Covered California market. Mr. Valentine alsoreviewed the market forces behind the recent mergers, acquisitions, and vertical integration of manypayers and providers. Relatedly, he discussed the potential benefits of directly contracting withproviders and thereby reducing the need for certain IPAs and MSO functions. Finally, Mr. Valentineled a conversation on the increasingly consumer-driven healthcare market. He noted that consumersare expecting more convenience and tailored care from their health plan; without these benefits,consumers have the ability to easily change plans. Mr. Valentine suggested considering new modelsof care that may include contracts with retail clinics, patient-centered medical homes, and chroniccare management as exemplified by CareMore’s successful model.

CEO John Baackes presented L.A. Care’s new strategic vision and proposed reorganization.

Future ActionThe Board will hold future discussions on the rollout of the Operating Plan and reorganization. TheOrganizational Performance Report will be reported quarterly to the Board. Provider performancewill also be a future discussion topic.

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Operations ReportSeptember 2015

Jon Freedman, Interim Chief Operating Officer

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Total L.A. Care membership as of September 1, 2015 was 1,841,788. This is anincrease of nearly 1% or a 12,651 member increase month-over-month.

Total growth year-to-date is 17.3% or 271,972 members.

Line of Business Jul-15 Aug-15 Sept-15

Medi-Cal Plan Partner 877,532 884,607 891,769

MCLA 854,526 867,556 877,089

Medicare 0 0 0

PASC-SEIU 45,937 45,762 45,658

Healthy Kids 411 418 442

CMC 15,896 14,910 14,491

L.A. Care Covered 16,365 15,877 12,326

LACC – Direct 7 7 13

TOTAL 1,810,674 1,829,137 1,841,788

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90

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15

Receipts 226,667 236,333 261,757 303,454 265,162 308,705 318,616 272,765 300,437

Production 180,977 203,397 238,796 262,227 226,987 277,843 299,675 316,384 335,095

Total Inventory 99,190 132,126 154,110 196,120 234,295 265,157 284,098 236,407 231,917

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Total current enrollment for Cal MediConnect (CMC) is 14,493 as of September 30, 2015.

Effective July 1, 2015, enrollment into CMC is on a voluntary basis only. In the third quarter, L.A. Care staff achieved 355voluntary enrollments.

Our member in-reach campaign included mailings to L.A. Care’s MCLA 70,000+ dual members and age-ins.

Challenges with Health Care Options negatively impact enrollment efforts. Staff continues to work with Centers forMedicare and Medicaid Services (CMS), Department of Health Care Services (DHCS) and other CMC plans to addressissues impacting the CMC voluntary enrollment process.

CY2016 CMC member materials, including the Member Handbook, provider directories and other materials have beenfinalized.

Educational materials on issues impacting CMC members, such as balance billing and deeming, continue to be circulatedto members as well as providers in newsletters and additional mailings.

Staff continue to coordinate efforts to provide key deliverables for CMS, including the CMC network adequacy, encounterdata submission, and preparations for the September sweeps period for Medicare risk adjustment.

2015 Accuracy Study: On September 29, 2015, Centers for Medicare & Medicaid Services (CMS) informed L.A. Care it had passed their Call

Center Accuracy audit. A CMS contractor, IMPAQ, monitored L.A. Care between June 20 – August 14, 2015. During thismonitoring process, calls were placed to L.A. Care’s customer service number Monday – Friday from 8 a.m. to 8 p.m.

Measure Part C Part C ResultsCompliant withCMS Standards?

Part D Part D ResultsCompliant withCMS Standards?

Accuracy 98% Compliant 94% Compliant

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New and revised Participating Provider Group (PPG) and Hospitalamendments are in process. Several amendments have been received with a10/1/15 and 11/1/15 start dates.

L.A. Care’s Skilled Nursing Facility (SNF) contracted network is now over 300.

Huntington Memorial Hospital and Good Samaritan Hospital have been addedto L.A. Care’s network for all products.

Transgender Health Services contracts have been developed and will bedistributed to targeted providers.

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Access to the Homeless Management Information System (HMIS):

L.A. Care has been working with Los Angeles Homeless Services Authority(LHASA) to obtain access to the Homeless Management Information System(HMIS), a database of known homeless individuals in Los Angeles County.

LHASA expects to grant L.A. Care access to HMIS, and provide training forit, by the end of November 2015.

The HMIS database will enable L.A. Care to cross reference whether an L.A.Care member is indeed homeless and where the member was last seen.

The ability to cross reference this information, will allow L.A. Care to identifythe appropriate homeless services providers where the member can beengaged in receiving an L.A. Care ID to obtain health and mental healthservices.

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Improvement in DHS HEDIS Administrative Rates for RY2015

SNI and Quality Improvement Departments collaborated to improve DHS data submission andquality for Reporting Year (RY) 2015.

L.A. Care and DHS met regularly beginning in June 2014 to strategize and track progress, andjointly identified additional data sources and extraction methodologies to improve rates for keyHEDIS measures.

The HEDIS Administrative rates released in June 2015 show that DHS experienced significantimprovement in several key measures from RY2014 to RY2015, including:

Measure RY2014DHS Rate

RY 2015DHS Rate

Change

Annual Monitoring of Persistent Medications –ACE Inhibitors & ARBs

27.70% 88.07% +60.37%

Annual Monitoring of Persistent Medications –Diuretics

30.00% 87.30% +57.30%

Comprehensive Diabetes Care – Hemoglobin A1ctesting

76.70% 84.00% +7.70%

Well Child Visits in the 3rd, 4th, 5th, and 6th Years 55.00% 64.00% +9.00%

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October 22, 2015

TO: Executive Committee

FROM : Jonathan Freedman, Chief Strategy Officer

SUBJECT: Fourth Quarter FY 2014-15 Organizational Performance Report

The organizational performance report summarizes the status of organizational goals andobjectives outlined in the Board-approved FY 2014-15 budget.

Among the notable activities for the fourth quarter are:

L.A. Care has completed provider contracting for its Antelope Valley direct contract networkdevelopment, adding 31 new primary care providers (PCPs) and 41 new specialists, improvingaccess for members in this region. The network now has 39 PCPs and 111 Specialists, alongwith lab, radiology, and other ancillary service providers. Additionally, L.A. Care’s specializedlong term care (LTC) network of five participating provider groups (PPGs) has expanded tocover all members receiving LTC in skilled nursing facilities (SNFs) in L.A. County. Ourfocused partnerships with these organizations have strengthened coordination of care andoversight, encouraging better outcomes and increased satisfaction among members,providers, and facilities.

As of September 1, 2015, L.A. Care met the target voluntary disenrollment rate of less than0.36%. The Member Outreach, Retention and Engagement unit led a Medi-Cal MemberRetention Workgroup this fiscal year and identified data-based retention strategies. The mostsignificant initiatives undertaken were an enhanced monthly transfer survey and improvedredetermination outreach among members in L.A. Care’s directly contracted network.

L.A. Care's initiatives with safety net providers continued apace. The mobile Vision To Learnpilot served approximately 750 children during the fourth quarter, of whom an estimated 350are L.A. Care members. In addition, L.A. Care continued its planning collaborative to createHealth Neighborhoods in partnership with the L.A. County Departments of Health Services,Mental Health, and Public Health, and the Community Clinic Association of Los AngelesCounty. The Collaborative has developed conceptual models to improve health outcomesfor individuals experiencing homelessness who have mental health and Substance UseDisorder (SUD) needs. The Blue Shield of California Foundation fully funded the project fora second year ($150,000 from October 1, 2015 through September 30, 2016) to conductoperational planning and implement interventions in pilot communities.

97

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 1

L.A. Care FY 2014-15 Strategic Priorities – Performance Report

Objective Measure Status Quarterly UpdateGoal 1: Improve medical care by increasing quality and the responsiveness of care networks.

1.1. By next review, maintainNCQA accreditation for Medi-Cal.

For 2015-2017, maintain 100%on Standards review throughongoing monitoring &assessment of compliance withthe Standards.

Implement QualityImprovement activities toachieve statistically significantimprovement in HEDIS scoresin the following measures:

2015: Avoidance of antibiotictreatment in adults with acutebronchitis2015: CDC HbA1c TestingTotal

Lead: Carter

NCQAaccreditation(Status=accredited)

100% compliancewith Standardsreview

HEDIS score of35.45% forAvoidance ofantibiotic treatmentin adults with acutebronchitis

HEDIS score of31.14% for CDCHbA1c TestingTotal

Q1: Oct – Dec 2014: A gap analysis has been conducted anda work plan established to maintain 100% on Standardsreview. HEDIS scores for AAB and CDC-A1c will beavailable June 2015. Preliminary HEDIS 2015 results as ofOctober 14, 2014 are AAB 33.64% and CDC A1c Testing66.01%.

Q2: Jan – Mar 2015: Implementation of new MEMstandards is on schedule for July 1, 2015. Work is in progressto monitor compliance with NCQA standards.A1c testing and avoidance of antibiotic treatment in acutebronchitis are currently being addressed through diseasemanagement activities and work teams. Performance onmeasurement year 2014 HEDIS rates will be evaluated afterthey are released in June 2015.

Q3: April – June 2015: Implementation of new MEMstandards began on June 24, 2015, prior to the effective dateof July 1, 2015. NCQA Mock Audit was conducted June 2-4,2015 to monitor compliance with NCQA standards.HEDIS results for measurement year 2014 have beenfinalized and submitted. L.A. Care anticipates final rates fromNCQA by September. The rates submitted to NCQA formeasurement year 2014 show improvement in both rates;CAC A1c testing improved from 31.14% to 83.14%; AABimproved from 35.45 to 29.73, this is a measure where alower rate is better.

Q4: July – September 2015: 2016 NCQA Standards includenew Network Management Standards, which are designed toenhance core patient protection for access to clinicallyappropriate care. New Utilization Management standardshave also been added which hold Plans responsible for

98

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 2

Objective Measure Status Quarterly Updateinforming their members of certain coverage details. Trainingfor the new standards is scheduled for October. Ongoingmonitoring is in progress for all other standards.

Of the measure of avoidance of antibiotic treatment in adultswith acute bronchitis, there was a decline to 29.73% of whichis > NCQA 2015 50th Percentile. We are monitoring theperformance at this time.For HbA1c screening, there was improvement from 31.14%to 83.14% but we remain at the 25th NCQA 2015Percentile. We are implementing a member incentive formembers to receive their A1c screen, Nephropathy testingand eye exam. In addition, we are conducting a memberoutreach focused on A1c screening and assisting members toget the testing complete.

1.2. By September 30, 2015, achieveor maintain a Medicare STARSrating of 3.5 for Part C and 3.0for Part D.

Lead: Freedman (COO)

Processesdeveloped andinternal reportingestablished for eachmeasure in Part Cand Part D CMCStar reporting.(Y/N)

Medicare STARSrating

Q1: Oct – Dec 2014: Based on the Medicare Star Rating finalresults, L.A. Care cured the 2014 Low Performing Icon.After careful consideration, L.A, Care decided to end itsparticipation in the Dual Eligible Special Needs Plan (DSNP)in preparation for Cal MediConnect (CMC). The MedicareStar work plan was reprioritized to focus on CMCinterventions and measures that have decreased by 1 to 2stars.

On January 1, 2015, many DSNP members transitioned intothe CMC product. An internal review of the Centers forMedicare and Medicaid Services’ (CMS) 2016 Star proposalhas also been conducted to identify changes for upcomingyears. Staff is expected to measure Consumer Assessment ofHealthcare Providers and Systems (CAHPS), HealthOutcome Survey (HOS), and administrative measures in2015 while Healthcare Effectiveness Data and InformationSet (HEDIS) will be added to the measurement set in 2016.

Q2: Jan – Mar 2015: Improvements related to Part C and

99

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 3

Objective Measure Status Quarterly UpdatePart D star ratings continue with the development of a three-pronged intervention for each measure that includes memberengagement, member and provider relationship, and systemsenhancement. Reasons for disenrollment from the CMCproduct are being identified and analyzed through focusgroups and surveys.

Q3: April – June 2015: Part C and Part D improvementefforts are focused on member, provider and group levelinterventions. In addition, Star priority areas are being re-evaluated and outreach developed accordingly. L.A. Care willbe responsible for reporting on national and state-specificquality withhold measures for Cal MediConnect. CMS willrelease withhold methodology and benchmarks for measureson a rolling basis and plans will receive a “pass” or “fail” foreach withhold measure as all measures are weightedequally. Several HEDIS, CAHPS, and HOS metrics areincluded in Demonstration Year 1 through 3. These and allQuality Withhold measures will be closely be monitored andincorporated into the overall Star work plan.

Q4: July – September 2015: L.A. Care made efforts toimprove Part C and D measures by developing and launchingintervention programs for all measures, with a focus onpriority measures that have decreased by 1 or 2 Stars. Keyinterventions in the 4th quarter include: collaboration withcommunity based organizations, continuous memberoutreach and education, and annual in-home assessments forhomebound Cal MediConnect members. Additionally, weare focusing on member retention and satisfaction efforts byconvening internal workgroups to strategize and monitorongoing activities, analyzing enrollment and disenrollmenttrends, and streamlining member touch points.

L.A. Care has passed the CMS Call Center Accuracy auditwith a Part C score of 98% and Part D score of 94%. Both

100

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 4

Objective Measure Status Quarterly Updatescores are above the average set across all MMP contracts inthe program.

1.3. By March 31, 2015, develop animproved process to evaluateprovider compliance withencounter reporting and bySeptember 30, 2016, implementsanctions for providers withreporting levels below anacceptable threshold.Recommended encounterthresholds are:

Medi-Cal –TANF- 4encounters PMPY

SPD – 6 encounters PMPY

CMC – 8 encounters PMPY

No sanctions for the first year,but consider a corrective actionplan with rigorous requirements.

Lead: Reilly (in consultation withCarter)

Process developedto evaluate providercompliance withencounterreporting. (Y/N)

% of providersmeeting encounterthresholds

Q1: Oct – Dec 2014: Data are currently under review.Encounter thresholds for the goal will be adjusted in thesecond quarter of this fiscal year.

Q2: Jan – Mar 2015: After considerable coordination withTransUnion, staff has obtained a report of submittedencounters broken down by PPG. The report includes thestatus and what L.A. Care accepted. This will allow staff todetermine low volumes and low acceptance rates. Thresholdsfor plan partner submissions will be determined later thisfiscal year as data continues to be analyzed.

Q3: April – June 2015: New benchmarks have beencalculated for Plan Partners as well as for providers. Thenumbers are being communicated to recipients this month(July 2015) for feedback. Specific encounter numbers listed inthe goal objective may need to be adjusted.

Q4: July – September 2015: Benchmarks werecommunicated to Plan Partners for feedback in July and weare compiling their responses. In addition HOA calculatedbenchmarks per PPG for incentive efforts and arecommunicating those to the individual PPGs as well.

Due to internal and external factors including file formatchanges, competing priorities, and incomplete data sources,the percentage of providers meeting encounter thresholdshas not been calculated at this time. Reporting for the Medi-Cal line of business has been provided to providers for P4Ppurposes, but an overall percentage of those providersmeeting the threshold have not yet been created. Estimatesare that it will be created by end of next quarter. The effort tocreate PPG level reporting continues.

101

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 5

Objective Measure Status Quarterly Update1.4. By March 31, 2015, develop a

deliberate network strategy byproduct line to increase controlover quality and cost; developspecialized physician networksfor certain high-cost medicalconditions.

Lead: Freedman (COO) (inconsultation w/Carter)

Product linespecific networkstrategy designedand implemented(Y/N)

Specializedphysician networksdeveloped (Y/N)

Q1: Oct – Dec 2014: The Tertiary Care Committee willdetermine which tertiary care facilities will be considered“Preferred” for L.A. Care Members. The Network will beseparately identified and available to the ParticipatingPhysician Groups (PPG). Additionally, the Provider NetworkOperations (PNO) Contracting Unit will be expanding thenetwork to include more tertiary care facilities under contractfor all products. This includes direct Specialty Care Physiciannetworks.

Q2: Jan – Mar 2015: Staff is working with all applicabledepartments to build a network strategy to have dual riskarrangements for MCLA. The expectation is to have it in theimplementation phase by fourth quarter.

Q3: April – June 2015: A specialized network of five PPGswas developed to care for L.A. Care’s CMC and Medi-Calmembers in long term care (LTC). These “InstitutionalPPGs” have established SNFist programs, whose healthcareprofessionals visit our members in the LTCsetting. Extensive training and collaboration is ongoing withthese providers.

New shared risk and dual risk DOFRs and correspondingrates were finalized for Medi-Cal and Covered CA. Thesenew and improved arrangements better align the financialincentives of L.A. Care and our PPG, hospital, SNF, andancillary networks. They reward our providers forcontrolling costs and improving quality, by moving moreancillary services (which our PPGs manage from a UMperspective) under the hospital shared risk pool (or capitatedhospital responsibility, in the case of dual risk deals).L.A. Care has nearly finished developing a directly contractedprovider network in the Antelope Valley. Multipledepartments are collaborating and planning to ensure asmooth implementation of this new model in late 2015.

102

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 6

Objective Measure Status Quarterly Update

Q4: July – September 2015: L.A. Care’s specialized LongTerm Care network of five PPGs has expanded to cover allmembers receiving LTC in SNFs in L.A. County. Ourfocused partnerships with these organizations havestrengthened our coordination of care and oversight,encouraging better outcomes and member/provider/facilitysatisfaction.

The new shared risk and dual risk amendments for MCLAand Covered CA/L.A. Care Covered have beencommunicated to providers. They include the followingprovisions, which aim to increase control over quality andcost, while developing specialized physician networks forcertain high-cost medical conditions.

New Aid Categories and Rateso Rates are no longer age/sex adjusted

New Universal DOFR

Transgender & Transplant Services are all L.A. CareRisk, and we are developing a direct network ofcontracted specialists

Home Infusion and Self-Injectables are Rx Benefit,rather than PPG risk or L.A. Care Medical Benefit.

Completed provider contracting for Antelope Valley DirectNetwork development. It is contracted with 39 PCPs and111 Specialists, along with lab, radiology, and other ancillaryservice providers. This network represents 31 new PCPs and41 new specialists.

1.5. By September 30, 2015,implement a leveragedpurchasing strategy thatincentivizes high quality andlower cost care across productlines, providers, and planpartners, to maximize L.A.

Plan for leveragedpurchasing strategy(Y/N)

Implementation ofleveraged purchasingstrategy. (Y/N)

Q1: Oct – Dec 2014: Work has not started on this goalobjective. Staff will provide an update next quarter.

Q2: Jan – Mar 2015: No update available. Work on theobjective has been delayed.

Q3: April – June 2015: No update available. Work on the

103

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 7

Objective Measure Status Quarterly UpdateCare’s purchasing power.

Lead: Freedman (COO)

objective has been delayed.

Q4: July – September 2015: No update available. Work onthe objective has been delayed.

Goal 2: Improve member and provider satisfaction with L.A. Care.2.1. By September 30, 2015, achieve

a score of 85.3% on the SNPCAHPS indicator “OverallRating of Health Plan.”

Lead: Carter

SNP CAHPS indicator“Overall Rating ofHealth Plan” is 83.5%

Q1: Oct – Dec 2014: On schedule for launch andsubmission of Medicare CAHPS 2015 data for CMCpopulation to CMS by required due dates. Staff is interpretingwhat drove results in the previous survey cycle and offeringguidance and analysis on key drivers to the Member StrategyWork Group.It is important to note that the goal of 85.3% on the SNPCAHPS indicator “Overall Rating of Health Plan” was basedon data from the DSNP population. Although some formerDSNP members have transitioned into the CMC population,there are differences between the two.

Q2: Jan – Mar 2015: Staff is on schedule for submission ofMedicare CAHPS 2015 data for the CMC population toCMS.The unofficial Medicare CAHPS 2015 report is expected inthe first half of August. CMS results for Star rating measuresfrom Medicare CAHPS are expected during that same timeframe.

Q3: April – June 2015: The survey firm submitted MedicareCAHPS 2015 data for the CMC population to CMS bydeadline, and it passed initial data checks by RAND. Theunofficial Medicare CAHPS 2015 report is in process, and is

104

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 8

Objective Measure Status Quarterly Updateexpected in the first half of August. CMS results for Starrating measures from Medicare CAHPS typically arriveduring that same time frame.

Q4: July – September 2015: CMS has not distributedMedicare CAHPS 2015 results for CMC (H8258) as of10/02/2015. The only scores that L.A. Care has received forMedicare CAHPS are from the survey firm’s unofficialreport. These generally differ from CMS scores due toundisclosed elements of CMS case mix adjusting. Theunofficial score for the Health Plan Rating is77.73% favorable (“8”s, “9”s, and “10”s on a scale of 0-10).

2.2. By September 30, 2015, achievean increase of 2 percentagepoints for each provider type onthe Provider Satisfaction Surveyindicator “Overall Satisfactionwith L.A. Care,” whichrepresents significantimprovement per provider type.

Lead: Carter

Provider SatisfactionSurvey indicator“Overall Satisfactionwith L.A. Care”increased by 2percentage points

Primary Care

Specialist

Hospital

Q1: Oct – Dec 2014: The 2014 Provider Satisfaction Surveysare being fielded and results will be available no earlier thanSeptember 2015. An internal study showed that incentivizedPrimary Care Providers (PCP) responded more favorable to“Overall level of satisfaction with L.A. Care programs.”Seventy-four percent (74.2%) of incentivized PCPs ratedtheir overall level of satisfaction with L.A. Care assatisfied/very satisfied, compared with 25.8% of non-incentivized respondents. Seventy-seven percent (77.4%) ofthose incentivized respondents reported satisfaction withL.A. Care’s Pay-for-Performance program, compared with66.9% of those not incentivized.

Q2: Jan – Mar 2015: The 2014 Provider Satisfaction Surveyfinal report was released in March 2015. Data showed nosignificant changes year-over-year among Medi-Cal surveyedprovider groups, but satisfaction summary rate scoresincreased for PCP and Specialty Care Providers surveys, anddecreased slightly for the Clinic survey between 2013 and2014. Small increases in summary rate scores across multiplesatisfaction measures indicates that L.A. Care is moving inthe right direction with meeting providers’ needs.

PCP Overall level of satisfaction increase

105

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 9

Objective Measure Status Quarterly Update2.2%

SCP Overall level of satisfaction increase 1.9%.

Clinic Overall level of satisfaction decreased 3.7%

Provider satisfaction scores for new lines of business: CMC,LACC, and PASC-SEIU ranged from 77.0% to 90.8% forPCP; 88.5% to 91.0% for SCP; and 77.7% to 96.6% forClinic respondents. Provider satisfaction with CMC was thelowest among all provider types.

Q3: April – June 2015: The project is on schedule. Surveysare expected to begin as early as August 1st, 2015.Provider Satisfaction Survey indicator “Overall Satisfactionwith L.A. Care” is estimated to increase by 3 percentagepoints:

Overall level of satisfaction (87.0% to 90.0%)

Primary Care Physicians (88.3% to 90.3%)

Specialist (81.5% to 86.5%)

Clinics (92.9% to 95.0%)Note: This 3% projected increase is based on NCQA goalsetting standards, given a 3 year trend. It is not guaranteed,but having solved problems transitioning from DSNPproduct to CMC line in 2014, L.A. Care should improve in2015 by moving the CMC rate.

LACC and CMC lines of business are primary targets forimproving L.A. Care provider overall level of satisfaction.LACC and CMC summary rate satisfaction scores (SRSS)were 9.4% and 7.1% below the least of the remainingbusiness line for specialist, respectively. CMC SRSS was14.8% below the Clinic overall SRSS.

Q4: July – September 2015: The kick off for the 2015Provider Satisfaction Survey took place September 17,2015. Initial surveys will then be fielded on October 26th.

106

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 10

Objective Measure Status Quarterly UpdateThe Surveys will remain in the field until sufficient samplesizes are achieved, but fielding should not exceed December31st. Final Report and deliverables are expected by the firstweek of February 2016

2.3. By September 30, 2015, reduceavoidable Medi-Caldisenrollment by 0.05% byassessing reasons fordisenrollment and employingstrategies to address the driversof disenrollment.

Lead: Freedman (COO)

Medi-Cal voluntarydisenrollment(target=.36%, whichrepresents a .05%reduction)

Q1: Oct – Dec 2014: Staff began creating reports that willassess reasons for Medi-Cal disenrollment. These reports willcontribute to the development of strategies to reducedisenrollment.

Q2: Jan – Mar 2015: The target of .36% overall voluntarydisenrollment has been met. Based on January 2014 throughJanuary 2015 data, Medi-Cal membership grew 22.6% andthe change in disenrollment year-over-year is 57% lower.

Q3: April – June 2015: L.A. Care continues to meet thetarget, maintaining an overall voluntary disenrollment rateless than 0.36%. Based on May 2014 through May 2015 data,Medi-Cal membership grew 27% while the change indisenrollment year-over-year is 49% lower.

Q4: July – September 2015: As of September 1, 2015, L.A.Care met the voluntary disenrollment rate target of less than0.36%. The Member Outreach, Retention and Engagement(MORE) unit led a Medi-Cal Member Retention Workgroupthis fiscal year and identified data- based retention strategies.Key initiatives undertaken, included an enhanced monthlyMCLA transfer survey and improved MCLA redeterminationoutreach.

2.4. By September 30, 2015,improve members’ andproviders’ ability to obtaininformation and receivecommunications from L.A. Carethrough enhanced member and

Communicationmethodsimplementation onschedule for:

Member portal

Provider portal

Q1: Oct – Dec 2014: The L.A. Care Covered Health BenefitExchange Member Portal and Mobile application wereredesigned to simplify the member experience. Providerportal enhancements included a PPG self-service capabilityfor add, change, and delete requests that were manual andlabor intensive previously.

107

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 11

Objective Measure Status Quarterly Updateprovider portals, mobileapplications, and other means ofelectronic communication.

Lead: Freedman(COO)/Schwaninger

Mobile applications

Other means ofelectroniccommunication

Strategies to improve the member and provider portals weredeveloped.Executing the Member and Provider Portal Strategy andother initiatives will be carried out during 2015. These willdrive adoption and utilization of the new communicationmethods dramatically.

Q2: Jan – Mar 2015: Staff has made improvements to theprovider portal for a better user experience.A vendor has been selected to extend the mobile applicationsand the member and provider portals to all remaining lines ofbusiness.

Q3: April – June 2015: Launched a new member portal thatmeets both National Committee for Quality Assurance(NCQA) Member Connection Standards and HealthInsurance Portability and Accountability (HIPAA)requirements.This portal is available for our Cal MediConnect, Medi-Caland L.A. Care Covered members who register for onlineaccess. The most exciting features of this new portal includepersonalized resources to help these members be moreinvolved with their own health and care. Members can:• View and print their ID card• Request a change of PCP• View and print a list of their prescriptions• Participate in wellness programs• Chat live online with a nurse• View claims (as applicable by line of business)

Q4: July – September 2015: The new member portal hasbeen launched. Next steps are to move PASC membership tothe new HealthX portal in November. The mobile App forall LOBs will also be released in November. Both steps arecurrently in review with Quality Assurance.

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Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 12

Objective Measure Status Quarterly UpdateThe provider portal is included in the scope for the CSP plusprogram and is in initiation and discovery Phase. The nextstep is to create the Project Charter and provide ProjectScope. Phase I ETA is July 2016.

2.5. By March 31, 2015, coordinatethe departments that interactwith members/providers andstreamline and tailormember/providercommunications to increaseeffectiveness.

Lead: Freedman (COO)

Process implemented tomanage and coordinateoutbound membercommunications acrossdepartments andproduct lines. (Y/N)

Process implemented tomanage and coordinateoutbound providercommunications acrossdepartments andproduct lines. (Y/N)

Q1: Oct – Dec 2014: The Member Outreach andEngagement Unit has begun working on strategies to manageand coordinate outbound member communications acrossdepartments. The Provider Relations Unit has implementedan internal Provider Communications Protocol. This willstreamline departments’ communication with the providernetwork. The Provider Portal has been expanded with newservices, and the Provider Data Unit has implemented aninteractive online system with the PPGs to add/deletephysicians in the network.

Q2: Jan – Mar 2015: Through a cross-functional effort, staffhave redesigned the Joint Operating Committee Meetingswith the PPGs and hospitals. Meetings will now occurregularly. There are also monthly webinars conducted withthe skilled nursing facilities for more effectivecommunication.The Member Portal for non-LACC lines of business is beingdeveloped; NCQA MEM standards-related functions havebeen prioritized. A member communications plan soon to becreated will include Executive Community AdvisoryCommittee feedback, comprehensive member educationmaterials, and Member Services training for membertechnical support.

Q3: April – June 2015: L.A. Care launched L.A. CareConnect, a new member portal that meets both NCQAMember Connection Standards and Health InsurancePortability and Accountability (HIPAA) requirements. Thisportal is available for our Cal MediConnect, Medi-Cal and

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Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 13

Objective Measure Status Quarterly UpdateL.A. Care Covered members who register for online access.

In addition to quarterly Joint Operating Committee (JOC)Meetings with all PPGs and hospitals, Provider Relations haslaunched monthly operational meetings with our PPG andhospital network. These meetings provide a forum for real-time education and discussion of day to day business issues,while the JOC meetings continue to be the venue fordialogue around strategic partnership opportunities.

Q4: July – September 2015: The MORE unit continues tolead subsequent phases of the L.A. Care Connect memberportal project, implementing content, usability andoperational improvements.

The MORE unit also streamlined the internal membercommunications submission and approval process incollaboration with a cross functional stakeholder team. Thenew process enables the centralized tracking of membermaterials across all channels and ensures Call Center staff iswell- equipped to address member inquiries about any L.A.Care member communications.

Provider network training regarding the new amendmentsand DOFR changes are all being coordinated through PNO,and includes material developed based upon feedback fromall departments (Medical Management, Member Services,Claims, Legal, Finance, etc.)

Goal 3: Implement an operational excellence strategy to excel at the full range of product lines offered by L.A. Care.3.1. By September 30, 2015 and

continuing through September30, 2017, perform organization-wide risk assessments andmitigate compliancevulnerabilities identified in our

Annual riskassessmentcompleted (Y/N)

75% of risksidentified as “high”are mitigated within

Q1: Oct – Dec 2014: A preliminary organization-wide riskassessment was completed. After reviewing the final report, ithas been determined that additional compliance riskassessment work is needed. Staff is in the planning processfor this next phase of the risk assessment.

110

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 14

Objective Measure Status Quarterly UpdateState and Federal programs.

Lead: Freedman

90 days Q2: Jan – Mar 2015: An additional risk assessment onMedicare and CMC was completed and the report wasreviewed and approved by the Internal ComplianceCommittee and by the Compliance and QualityCommittee. Steps for risk mitigation were outlined in thereport and are being implemented by staff.

Q3: April – June 2015: Mitigation steps outlined in the riskassessment continue to be performed, which includeconducting of internal monitoring and administration ofroutine internal compliance procedures, including CMScomplaint tracking and resolution, HPMS memorandumfulfillment, and material review and approval.

Q4: July – September 2015: Monitoring activities areongoing and have been reported to the Internal ComplianceCommittee. Corrective Action Plans have been implementedwhere required and monitored to ensure implementation.

3.2. By December 31, 2014, improveaccuracy of claims paymentswithin the QNXT system toachieve overall processingaccuracy of 98.5% with acorresponding decrease ininterest payments of 20% frominterest payments seen in MHC.

Lead: Freedman (COO)

Claims processingaccuracy(target=98.5%)

Interest payments(target=20% decreasefrom MHC level)

Auto-adjudication rate

Q1: Oct – Dec 2014: The claims processing accuracy was96.10% in October. Data are being analyzed for Novemberand December 2014 and will be reported in the secondquarter.Given that the QNXT conversion is not complete, the dataon interest payments is not yet fully automated. Theseupdates will be available next quarter.Blended auto adjudication between MHC and QNXT was11% as of December 31, 2014.

Q2: Jan – Mar 2015: Claims accuracy averaged 99% duringthe second quarter, exceeding the target for the Medicare lineof business. Accuracy levels for non-Medicare lines ofbusiness averaged 96% with the primary driver for notachieving the goal attributed to significant increases ininventory.Interest payments met target with a decrease being seen in

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Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 15

Objective Measure Status Quarterly Updateboth MHC and QNXT.Blended auto adjudication rate at the end of March was 11%with 7% auto adjudication being achieved in MHC whileQNXT auto adjudication increased to 14%.

Q3: April – June 2015: Claims accuracy averaged 96.4%during April and May 2015 for the Medicare line of business.Accuracy levels for non-Medicare lines of business averaged92% with the primary driver for not achieving the goalattributed to significant increases in inventory.The adjudication rate for April was 6% while the autoadjudication rate for May was 10% in MHC.June is not included in this data as the entire month was notable to be obtained.

Q4: July – September 2015: Claims accuracy averaged99.9% during July and August 2015 for the Medicare line ofbusiness. Accuracy levels for non-Medicare lines of businessaveraged 96.7%.The adjudication rate for June was 8%; July 10%; August 8%.September is not included in this data as the entire monthwas not able to be obtained.

3.3. By September 30, 2015,implement a regular reviewprocess for balanced scorecardand product-line specificdashboard reports, and developan escalation process whenmetrics fall below a targetedrange.

Lead: Freedman (in consultationwith Reilly)

Monthly LG review ofdashboard with follow-up/escalation processimplemented (Y/N)

Q1: Oct – Dec 2014: The dashboard has been drafted andpresented to L.A. Care’s Leadership Group, and is currentlybeing fine-tuned to best represent organizational needs.

Q2: Jan – Mar 2015: The dashboard will be revised to reflectmetrics associated with updated strategic priorities developedin conjunction with L.A. Care’s new CEO.

Q3: April – June 2015: Strategic Vision document is underdevelopment and will be shared with the Board at theSeptember Board retreat. The accompanying operationalplan, currently under development, includes metrics for eachtactic. Key metrics will be identified and compiled into an

112

Status: Green – On target; Yellow – Partially met or at risk for not meeting target; Red – Not on target; No color – Update pending

Updated 10/21/2015; Page 16

Objective Measure Status Quarterly Updateorganizational dashboard

Q4: July – September 2015: The Board approved theStrategic Vision and operating plan at its annual retreat; thereporting tool with metrics is being developed. L.A. CareLeadership Team has resumed regular review of the KeyPerformance Indicator Report.

3.4. By March 30, 2015, improve theuse of data by establishingshared, accountable ownershipof enterprise data through aData Governance Councilcomprised of Data Owners andassigned Data Stewards for eachdata domain.

Lead: Reilly

Implementation ofData Governanceprocess on schedule.(Y/N)

Q1: Oct – Dec 2014: Implementation of Data Governance ison schedule. Ownership by data domain is in place, and DataStewards have been identified and are participating in DataGovernance tasks specific to their domain expertise.

Q2: Jan – Mar 2015: Data Governance continues to evolveand is now an integrated piece of the enterprise-wide datawarehouse (EDW) effort. The Council meetings for DataGovernance have now been combined with the EDWmeetings, and data stewards from each domain are involvedin the definition of data elements, as well as the preliminaryarchitecture model.

Q3: April – June 2015: The objective to identify data ownersand assign data stewards is an ongoing effort as theparticipants frequently change, however there is and has beena process in place to accomplish this on an ongoingbasis. EDW efforts have moved forward for Membership,Provider and Claims domains with participation from DataStewards in each of the efforts.

Q4: July – September 2015: Data Governance continueswith the Electronic Data Warehouse (EDW) efforts. DataStewards and EDW developers have combined efforts. Thefirst release (1.2) of the EDW has been implemented. TheEDW remains in its infancy, but this is a step towardscentralizing data efforts.

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Objective Measure Status Quarterly Update3.5. By September 30, 2017, design

and deploy an enterprise-widedata warehouse solution that isrobust and adaptable to addressboth current and future L.A.Care business informationneeds.

Lead: Schwaninger

Implementation ofEDW modules andtools rolled out byscheduled milestonedates. (Y/N)

Q1: Oct – Dec 2014: The setup for the development andproduction environments that is required for EDW wascompleted in October 2014. The Member EDW physicaldata model was completed in December 2014. Thedeployment for an EDW solution is on target.

Q2: Jan – Mar 2015: The required test environments neededto validate the design and data load for the EDW werecompleted. As of end March 2015 project efforts for therelease of 1.0 were 92% complete for Design, 81% completefor Development, and 19% complete for QualityAssurance.

Q3: April – June 2015: Finalized the physical/logical datamodels for member and provider data in the Enterprise DataWarehouse. Data loads for member data were tested. Setupand configuration of the new Data Warehouse productionserver (virtual) was installed and configured with the latestrelease of Oracle database software. Completed Release 1.1 –Medi-Cal member data including provider assignments.

Q4: July – September 2015: Completed Code Review, UserAcceptant Test, and QA Sign-off for the new (EDW) DataWarehouse.Put the EDW into production for phase 1.X and successfullyloaded 5 years of data for Members and Providers into theData Warehouse.

3.6. By December 2014 andcontinuing through September30, 2017, ensure that turnoveramong staff employed at L.A.Care for at least one yearremains below the industrystandard (currently 15.2%) andmonitor the turnover rate

Turnover rate (target=below industrystandard; currently15.2%)

employees with lessthan one yeartenure

employees with

Q1: Oct – Dec 2014: Employee turnover in the less than oneyear tenure category for the first quarter of 2014-15 was7.36%. Annualized, the turnover rate would be 25.04% basedon data from Jan-Dec 2014.Turnover for employees with greater than one year tenurewas 3.27% for the first quarter of 2014-15. Annualized, theturnover rate would be 15.81% based on data from January-December 2014.

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Objective Measure Status Quarterly Updateamong employees with less thanone year to ensure that itremains consistent with industrystandards for new employees.

Lead: Turner

more than one yeartenure Q2: Jan – Mar 2015: Employee turnover in the less than one

year tenure category for the second quarter of 2014-15 was5.24%. Annualized, the turnover rate would be 23.67% basedon data from April 2014-March 2015.Turnover for employees with greater than one year tenurewas 3.94% for the second quarter of 2014-15. Annualized,the turnover rate would be 15.55% based on data from April2014- March 2015.Q1 to Q2 comparison: turnover for employees with less thanone year of service declined 2.12% and turnover foremployees with more than one year of service increased.67%.

Q3: April – June 2015: Employee turnover in the less thanone year tenure category for the third quarter of 2014-15 was4.83%. Annualized, the turnover rate would be 22.55% basedon data from July 2014-June 2015.Turnover for employees with greater than one year tenurewas 3.15% for the third quarter of 2014-15. Annualized, theturnover rate would be 14.49% based on data from July2014-June 2015.Q2 to Q3 comparison: turnover for employees with less thanone year of service declined by .041% (better) and turnoverfor employees with more than one year of service decreasedby 0.79% (better).

Q4: July – September 2015: Employee turnover in the lessthan one year tenure category for the fourth quarter of 2014-15 was 6.72%. Annualized, the turnover rate would be24.13% based on data from October 2014- September 2015.Turnover for employees with greater than one year tenurewas 3.19% for the fourth quarter of 2014-15. Annualized, theturnover rate would be 13.62% based on data from October2014- September 2015.Q3 to Q4 comparison: Turnover for employees with less

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Objective Measure Status Quarterly Updatethan one year of service increased by 1.89% and turnover foremployees with more than one year of service increasedby 0.04%.

Goal 4: Improve financial sustainability of direct product lines.4.1. Maintain an MCLA medical cost

ratio of 94% through September30, 2015, and achieve an MCLAmedical cost ratio of 93% bySeptember 30, 2017.

Lead: Tim Reilly/ Trudi Carter

MCLA medical costratio (target for2015=94%)

Q1: Oct – Dec 2014: First quarter financial information wasnot available at the time this report was prepared, but will bereported at the January Finance and Budget CommitteeMeeting. The MCLA MCR for the first two months of thefiscal year was favorable at 90.2% of revenue.

Q2: Jan – Mar 2015: The MCLA MCR was 91.0% for thefirst five months ending February 2015. The year-to-datebudgeted ratio for this period was 90.9%, making the actualperformance 0.1% unfavorable to the plan. The full secondquarter financial information will be reported at the AprilFinance & Budget Committee meeting.

Q3: April – June 2015: The MCLA MCR was 93.0% for theeight months ending May 2015. The year-to-date budgetedratio for this period was 92.7%, making the actualperformance 0.3% unfavorable to the plan. The full thirdquarter financial information will be reported at the JulyFinance & Budget Committee meeting.

Q4: July – September 2015: The MCLA MCR was 91.7%for the eleven months ending August 2015. The year-to-datebudgeted ratio for this period was 93.5%, making the actualperformance 1.8% favorable to the plan. The full fourthquarter financial information will be reported at the OctoberFinance & Budget Committee meeting.

4.2. By December 31, 2014,establish financial andperformance objectives related

Operating margin byproduct line (targets arethe budgeted operating

Q1: Oct – Dec 2014: Financial and performance objectivesrelated to financial sustainability were established. Directproduct operating margins through the first two months of

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Objective Measure Status Quarterly Updateto financial sustainability ofdirect product lines and achieveobjectives by September 30,2015.

Lead: Tim Reilly

margins) the fiscal year were unfavorable for MCLA, L.A. CareCovered, and Healthy Kids. The operating margin for CMC,Medicare, and PASC-SEIU had a favorable variance. The fullfirst quarter will be reported at the January Finance andBudget Committee Meeting.

Q2: Jan – Mar 2015: Financial and performance objectivesrelated to financial sustainability were established. Directproduct operating margins through the first five months ofthe fiscal year were unfavorable for CMC and L.A. CareCovered. The operating margin for MCLA, Medicare, PASC-SEIU and Healthy Kids (0-5) had a favorable variance. Thefull second quarter financial information will be reported atthe April Finance and Budget Committee Meeting.

Q3: April – June 2015: Financial and performance objectivesrelated to financial sustainability were established. Directproduct operating margins through the first eight months ofthe fiscal year were unfavorable for CMC, L.A. Care Coveredand PASC-SEIU. The operating margin for MCLA, Medicareand Healthy Kids (0-5) had a favorable variance. The fullthird quarter financial information will be reported at the JulyFinance & Budget Committee meeting.

Q4: July – September 2015: Financial and performanceobjectives related to financial sustainability were established.Direct product operating margins through the first elevenmonths of the fiscal year were unfavorable for CMC, L.A.Care Covered and PASC-SEIU. The operating margin forMCLA, Medicare and Healthy Kids (0-5) had a favorablevariance. The full fourth quarter financial information will bereported at the October Finance & Budget Committeemeeting.

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Objective Measure Status Quarterly Update4.3. By March 30, 2015, develop a

conceptual framework for analternate contracting model forcertain hospitals and PPGs tobetter align risk and costreduction opportunities, andimplement model by September30, 2016.

Lead: Freedman (COO)

Conceptual frameworkfor alternate contractingmodel developed (Y/N)

Q1: Oct – Dec 2014: Work has not started on this goalobjective. Staff will provide an update next quarter.

Q2: Jan – Mar 2015: No update available. Work on theobjective has been delayed.

Q3: April – June 2015: A new DOFR that aligns risk andcost reduction opportunities for all lines of business has beenfinalized. Rates have been developed for this newcontracting model, and amendments will be distributed inQ3-2015. Covered CA line of business will have the newDOFR and rate structure implemented in Q3-2015, with thetransition from shared to dual risk to follow in 2016. CMC isalready predominately contracted under this newDOFR/rate/dual-risk model, so few (if any) changes will bemade to that line of business.

Q4: July – September 2015: New MCLA and Covered CAamendments were communicated to providers. The newmodel includes: PMPMs not age/sex adjusted, alignedDOFR risk, and reduced cost exposure.

L.A. Care has initiated its first dual-risk MCLA contractmodel, and is working with Medical Management tostrengthen the oversight and monitoring policies andprocedures necessary in order to expand this model.

4.4. By March 31, 2015, develop anenterprise-wide delegationstrategy to ensure a consistentand simplified approach acrossall providers and product linesand improve L.A. Care’soversight of delegationcompliance.

Lead: Freedman (COO)

Enterprise-widedelegation strategydeveloped (Y/N)

Q1: Oct – Dec 2014: A cross-functional effort by PNO andUtilization Management (UM) designed and codified astandard Division of Financial Responsibility (DOFR) for allproducts. Additionally, every PPG is being audited forextended delegation for each product line. All PPGs in CMCare considered extended delegates. By the end of 2015, thegoal is to have all PPGs be extended delegates.

Q2: Jan – Mar 2015: Staff is working on implementing thestrategy in order to have all of PPGs audited for Extended

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Objective Measure Status Quarterly UpdateDelegation by the first quarter of calendar year 2016. Astandardized DOFR will be sent to PPGs and applicablehospitals by July 1, 2015.

Q3: April – June 2015: The standardized DOFR is nowcomplete, and its corresponding rates are now developed forMedi-Cal and Covered CA. This new DOFR and thecorresponding rates will be going out to all PPGs with theupdated extended delegation agreement in July 2015. Weremain on track to have our entire network operating asextended delegates by the end of 2015.

Q4: July – September 2015: The new amendments includeextended delegation for all capitated PPGs. The shiftsintroduced by the new universal DOFR represent anenterprise-wide delegation strategy which ensures aconsistent and simplified approach across all providers andproduct lines and improves L.A. Care’s oversight ofdelegation compliance. Additional delegation agreementupdates are projected for implementation via an amendmentin Q4-2015 or Q1-2016.

4.5. By September 30, 2015, evaluatealternate care delivery models,such as expanded scope ofpractice for non-physicianclinicians.

Lead: Carter

Alternate care deliverymodels evaluated.(Y/N)

Q1: Oct – Dec 2014: Staff is considering alternate caredelivery models, including the neighborhood delivery systemmodel, the modified Medi-Cal Accountable CareOrganizations model, and an integrated partner Countymodel.

Q2: Jan – Mar 2015: No update available. Staff continues toresearch alternate delivery models and will have an updatenext quarter.

Q3: April – June 2015: Staff continues research on modelsand will have assigned deliverable by September date.

Q4: July – September 2015: L.A. Care invited a consultant

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Objective Measure Status Quarterly Updateto conduct a preliminary look at care models in CMC. Thefinal report will be provided in two weeks. Preliminaryrecommendations suggested using a mixed model –delegation to highly competent PPGs and a best in classdirect model. We will continue to flesh out preliminaryrecommendations out and have final recommendations bythe next reporting period.

Goal 5: Ensure access to care for low income and vulnerable populations through supporting the safety net and demonstrating value of theLocal Initiative under the Medi-Cal Two-Plan model.

5.1. By September 30, 2015, providecommunity clinic and CountyDHS providers with training,technical assistance and othersupport to enable both HCLAand the County to achieve animprovement of 5% relative tocurrent scores on HEDIS auto-assignment measures.

Lead: Freedman (COO)/Carter

Trainings and technicalassistance provided toHCLA and CountyDHS. (Y/N)

Safety net HEDIS auto-assignment measuresfor reporting year 2015(target=5% increase)

DHS

HCLA

Q1: Oct – Dec 2014: Staff are working with HCLA, one ofL.A. Care’s largest safety net Independent PhysicianAssociations and DHS to improve member engagement anddevelop a strategy for HEDIS performance improvement.Meetings will occur, at minimum, quarterly with an increasedfrequency during early 2015. Example agenda items includeprioritization of measures, interventions to improveperformance, and data capture/transmission.

Q2: Jan – Mar 2015: Staff continue to meet with DHS andHCLA to structure meaningful and impactfulinterventions. The work plan is being finalized to ensuremembers receive necessary care per HEDIS specifications.Interventions have been put into place to addressimprovement strategies. DHS passed the primary sourceverification audit and was able to provide data as evidence ofcare and service being rendered.

Q3: April – June 2015: DHS has shown improvement intheir measurement year 2014 rates, most of which isattributed to improved data submission/capture.L.A. Care and DHS collaborated to mine all available datasources for HEDIS, resulting in significant increases in DHS’administrative HEDIS scores for reporting year 2015. Forexample, DHS’s score on Annual Monitoring of PersistentMedications – ACE Inhibitors & ARBs increased from

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Objective Measure Status Quarterly Update27.7% in RY2014 to 87.1% in RY 2015, and AnnualMonitoring of Persistent Medications – Diuretics increasedfrom 30% in RY2014 to 87.3% in RY2015. Because DHSrepresents more than a quarter of L.A. Care’s directpopulation, DHS’ improvements have a large impact onoverall scores.

Q4: July – September 2015: DHS and L.A. Care conducteda root cause analysis of DHS scores on HEDIS auto-assignment measures and identified relevant interventionsand data strategies to build on progress made duringMeasurement Year 2014. DHS and L.A. Care continue tomeet monthly to coordinate intervention strategies with L.A.Care member incentives, and have implemented a dataexchange schedule for the remainder of 2015. One next stepis to examine how DHS' implementation of the ORCHIDEHR will impact HEDIS. L.A. Care and DHS continue tomeet on a monthly basis to align strategy and ensureappropriate data flow. We are also continuing our work withHCLA who has 6 clinics that are part of the Tranquada Vgrant to improve HEDIS performance and data flow.

5.2. By September 30, 2015,implement at least onesignificant pilot project withsafety net providers and asecond by September 30 2016to improve health status and/orincrease quality and lower costof care for L.A. Care members.

Lead: Freedman/Freedman(COO)

Pilot projectimplemented (Y/N)

Q1: Oct – Dec 2014: On January 1, 2015, L.A. Careimplemented the Mobile Vision Care Pilot pursuant to SenateBill 870. The three-year pilot will deliver vision care servicesto children enrolled in Medi-Cal at school sites in LosAngeles County.L.A. Care is the lead agency for a year-long collaborativeplanning process to create “Health Neighborhoods” thatimprove care coordination, funded by a grant from the BlueShield of California Foundation. Project partners are DHS,Department of Mental Health, Department of Public Health,and the Community Clinic Association of Los AngelesCounty.

Q2: Jan – Mar 2015: L.A. Care continues to collaborate withsafety net providers on a variety of projects. Recent progress

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Objective Measure Status Quarterly Updateincludes approximately 2,500 children that have receivedservices through the Mobile Vision Care Pilot, of which aportion are L.A. Care members.L.A. Care is also partnering with the L.A. CountyDepartments of Health Services, Mental Health, and PublicHealth, and the Community Clinic Association of LosAngeles County for a year-long collaborative planningprocess to create “Health Neighborhoods” that improvehealth outcomes for homeless individuals with co-occurringmental health and substance use disorders. The project wasfunded by the Blue Shield of California Foundation.

Q3: April – June 2015: L.A. Care’s current collaborationswith safety net providers are continuing to make progress.Vision to Learn, the provider contracted for the MobileVision Services pilot, has served approximately 1,800 L.A.Care members between January 1, 2015 and May 1, 2015.DHCS approved a revised reimbursement model on April30, 2015, which will streamline administration and enableVision to Learn to focus more resources on providing visioncare to children at school sites.

L.A. Care is leading a year-long collaborative planningprocess to create homeless-focused “Health Neighborhoods”in partnership with the L.A. County Departments of HealthServices, Mental Health, and Public Health, and theCommunity Clinic Association of Los Angeles County. Inthe last quarter, the Collaborative has selected four pilotcommunities (Pacoima, Hollywood,MLK/Watts/Willowbrook, and Southeast L.A./GatewayCities) and conducted interviews with key providerstakeholders in each one. The Collaborative also applied fora second year of funding from the Blue Shield of CaliforniaFoundation, which will be used to create a sharedmeasurement strategy across agencies and provide technical

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Objective Measure Status Quarterly Updateassistance for implementation.

Q4: July – September 2015: L.A. Care's initiatives withsafety net providers continued apace. The Mobile VisionServices pilot served approximately 750 total children duringthe 4th quarter, which included summer vacationmonths. Approximately 350 are estimated to be L.A. Caremembers.

In addition, L.A. Care continued its planning collaborative tocreate Health Neighborhoods in partnership with the L.A.County Departments of Health Services, Mental Health, andPublic Health, and the Community Clinic Association of LosAngeles County. The Collaborative has developedconceptual models to improve health outcomes forindividuals experiencing homelessness who have mentalhealth and SUD needs. The Blue Shield of California fullyfunded the project for a second year ($150,000 from10/1/2015 through 9/30/2016) to conduct operationalplanning and implement interventions in pilot communities.

5.3. By March 31, 2015 andcontinuing through 2017,educate internal and externalstakeholders and activelypromote the value of the Two-Plan Model and the LocalInitiative in meeting localcommunity and safety netneeds.

Lead: Freedman

Stakeholder educationalmaterials developed(Y/N)

Q1: Oct – Dec 2014: Three fact sheets are being developedto educate internal and external stakeholders on the value ofthe Two-Plan Model and the Local Initiative.Communications staff will provide specific data by legislativedistrict of sponsorship investments over the past year toassist with the Government Affairs Department’s strategicefforts.

Q2: Jan – Mar 2015: Fact sheets to educate internal andexternal stakeholders on the value of the Two-Plan Modeland the Local Initiative have been completed. An additionalfact sheet with useful L.A. Care operating statistics has alsobeen developed, as well as an updated organization overviewPowerPoint presentation. All materials are now updated on amonthly basis and sponsorship investments data are availableby legislative district.

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Objective Measure Status Quarterly Update

Q3: April – June 2015: Updated fact sheets on the value ofthe Two-Plan Model and the Local Initiative have beencompleted and continue to be distributed to stakeholders.Fact sheet with L.A. Care operating statistics andorganizational overview presentation also updated. Newemployee orientation organizational overview and historypresentation created and is now offered to new hires on aweekly basis. 2013-14 Annual report content, design andlayout completed, report printed and printed copiesdistributed internally and externally. Electronic version alsoavailable.

Q4: July – September 2015: Updated fact sheets on thevalue of the Two-Plan Model and the Local Initiative havebeen completed and continue to be updated and distributedto stakeholders. Fact sheet with L.A. Care operating statisticsand organizational overview presentation has also beenupdated. New employee orientation organizational overviewand history presentation was created and is being updatedand expanded to include additional organizationalinformation. Basic organizational overview presentation foruse by staff is now updated monthly to reflect new operatingand membership statistics. Planning meetings for the 2014-15annual report have begun. An electronic version only optionis being considered with a change in content direction tobetter meet organizational and stakeholder needs.

5.4. By March 31, 2015 andcontinuing through 2017,developing a more proactiveand comprehensive advocacystrategy to preserve the Two-Plan Model, including Boardlegislative advocacy days inSacramento and identifying and

Advocacy strategydeveloped (Y/N)

Legislative AdvocacyDays held (Y/N)

Q1: Oct – Dec 2014: L.A. Care Advocacy Strategy for 2015has been developed and was presented to the Board ofGovernors at the December 2014 meeting.On November 18, 2014, L.A. Care participated in aLegislative Briefing at the State Capitol with Local HealthPlans of California. Staff conducted a presentation on L.A.Care’s experience with the Medi-Cal Expansion transition.Attendees were legislative offices, Department of Managed

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Objective Measure Status Quarterly Updatecultivating legislativechampions.

Lead: Freedman

Health Care, Legislative Analyst's Office, and Department ofHealth Care Services.

Q2: Jan – Mar 2015: During the second quarter, meetingswere held with 14 Los Angeles Congressional DelegationOffices in Washington D.C. and with each of the LosAngeles State Senate and Assembly Delegation Offices, aswell as with key committee offices. In addition, theLegislative Black Caucus invited L.A. Care to present on theMCO tax and other budget issues of concern to L.A. Careduring their February Caucus meeting.On February 19th, L.A. Care held a briefing at L.A. Careheadquarters to educate local elected offices of importantdevelopments in health policy issues related to L.A Care andthe community. There were 33 state and congressionaloffices in attendance.

Q3: April – June 2015: During the third quarter, meetingswere held with 8 state legislative offices, 5 congressionaloffices in DC, and 6 officials from the Governor’sAdministration. L.A. Care’s CEO attended these meetings aswell as the Director of Government Affairs.

Q4: July – September 2015: During the fourth quarter,several meetings were held with key leadership members(Senators Hernandez and Lara) regarding the MCO taxproposals/Special Session. During the various meetings,L.A. stressed importance of maintaining Two Plan Modeland value.

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Government Affairs

L.A. Care Legislative MatrixUpdated as of October 14, 2015

The following are enacted bills relevant to L.A. Care’s operations. If there are any questions, please contact CherieFields, Director of Government Affairs, at cfields@lacare.org or by telephone at (916) 930-0043.

AB 91 AUTHOR: Assembly Budget CommitteeTITLE: Budget Act of 2015SUMMARY: Amends the Budget Act of 2014 by amending, adding, and repealing items of

appropriation.POSITION: Watch, CAHP – WatchSPONSOR: N/ADISPOSITION: Enacted

AB 93 AUTHOR: Weber [D]TITLE: Budget Act of 2015SUMMARY: Makes appropriations for the support of State government for the 2015-16 fiscal

year.POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

AB 119 AUTHOR: Weber [D]TITLE: Public Health: Medi-Cal: Nursing FacilitiesSUMMARY: Modifies the Medi-Cal nursing facility calculation of rates. Extends the assessment

of the quality assurance fee, implementation of the rate methodology, and theimplementation of related provisions. Makes changes to the amount of set-asides tobe transferred to the Skilled Nursing Facility Quality and Accountability SpecialFund. Requires the Department of Health Care Services to report specifiedinformation to the relevant legislative budget committees.

POSITION: Watch, CAHP – WatchSPONSOR: N/ADISPOSITION: Enacted

AB 187 AUTHOR: Bonta [D]TITLE: Children’s Services Program: Medi-Cal: Managed CareSUMMARY: Extends the termination of the prohibition against the State Children's Services

Program from being incorporated into a Medi-Cal managed care contract enteredinto after a specified date.

POSITION: Watch; CAHP – WatchSPONSOR: N/ADISPOSITION: Enacted

AB 250 AUTHOR: Olbernolte [R]TITLE: Telehealth: Marriage and Family Therapy InternsSUMMARY: Expands the definition of health care provider to include a marriage and family

therapist intern or trainee. Authorizes a marriage and family therapist intern andtrainee to provide services via telehealth if he or she is supervised as required by theLicensed Marriage and Family Therapist Act, and is acting within the scopeauthorized by the Act and in accordance with any regulations governing the use of

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telehealth promulgated by the Board of Behavioral Sciences.POSITION: Watch, CAHP – WatchSPONSOR: N/ADISPOSITION: Enacted

AB 339 AUTHOR: Gordon [D]TITLE: Health Care Coverage: Outpatient Prescription DrugsSUMMARY: Prohibits health care service plan or health care insurance formularies from

discouraging the enrollment of individual with health conditions and reducing thegenerosity of the benefit for those with a particular condition. Provides that a drugcopay shall not exceed a specified amount for a specified supply. Provides anexception. Requires coverage of a single antiretroviral drug treatment needed to treatAIDS/HIV. Relates to coverage for medically necessary drugs. Relates tononformulary drug requests.

POSITION: Watch, CAHP – OpposeSPONSOR: N/ADISPOSITION: Enacted

AB 374 AUTHOR: Nazarian[D]TITLE: Health Care Coverage: Prescription DrugsSUMMARY: Authorizes a request for an exception to a health care service plan's or health

insurer's step therapy process for prescription drugs to be submitted in the samemanner as a request for prior authorization for prescription drugs. Requires the planand insurer to respond to such request in the same manner as prior authorizationrequests. Requires the State departments of Managed Health Care and Insurance toinclude a provision for step therapy exception requests in the prior authorizationform.

POSITION: Watch; CAHP – OpposeSPONSOR: N/ADISPOSITION: Enacted

AB 614 AUTHOR: Brown [D]TITLE: Health Care Standards of PracticeSUMMARY: Authorizes the State Department of Public Health to use a revised administrative

process to update regulatory references to health care standards of practice adoptedby a State or national association when outdated standards are already referenced inregulations. Requires the posting the update on the Department's Internet Web site,notify stakeholders of the proposed change, and regulatory change, acceptcomments, and to consider such comments prior to adopting new regulations.Relates to eating disorders.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

AB 627 AUTHOR: Gomez [D]TITLE: Pharmacy Benefit Managers: Contracting PharmaciesSUMMARY: Relates to workers' compensation. Requires a pharmacy benefit manager

reimbursing a contracting pharmacy for a drug on a maximum allowable cost basisto include contract information identifying any national drug pricing compendia orother data sources used to determine the maximum allowable cost for the drugs ona maximum allowable cost list and to provide for an appeal process. Requires themanager to provide the most up-to-date cost list or lists used by the manager in a

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Web-based format.POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

AB 964 AUTHOR: Chau [D]TITLE: Civil Law: PrivacySUMMARY: Defines encrypted for purposes of existing law that provides the regulation of

entities that own or licenses computerized data that includes personal informationto disclose a breach of the security of the system or data to any State resident whoseunencrypted person information was, or is reasonably believed to have been,acquired by an unauthorized person.

POSITION: Watch, CAHP – WatchSPONSOR: CPCADISPOSITION: Enacted

AB 1163 AUTHOR: Rodriguez [D]TITLE: Health Care Services Plan and Health InsurersSUMMARY: Prohibits a material change made to the terms and conditions of a contract between

a health care service plan and a solicitor or a health insurer and a life agent, frombecoming effective until the plan or insurer has delivered to the solicitors or lifeagent written or electronic notice of the change or changes to the contract, within aspecified time period.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

AB 1436 AUTHOR: Burke [D]TITLE: In-Home Support Services: Authorized RepresentativesSUMMARY: Authorizes an applicant for, or recipient of, in-home supportive services to

designate in writing a person to act as an authorized representative for purposes ofthe In-Home Supportive Services program. Provides that the representative has alegal responsibility to act in the applicant or recipient's best interest. Excludespersons with conviction for fraud. Requires the development of a form, with thecounty to retain the original of the form. Includes domestic, personal care andparamedical services.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

AB 1541 AUTHOR: Gatto [D]TITLE: Medical Records Electronic DeliverySUMMARY: Amends an existing law which requires a business that owns, licenses, or maintains

personal information to implement and maintain reasonable security procedures andpractices. Revises the definition of personal information to include health insuranceinformation and a username or email address combined with a password or securityquestion and answer for access to an online account.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

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SB 4 AUTHOR: Lara [D]TITLE: Health Care Coverage: Immigration StatusSUMMARY: Relates to individuals under a specified age enrolled in restricted-scope Medi-Cal to

be enrolled in the full-scope benefits, if otherwise eligible, if a specifieddetermination regarding immigration status is made. Requires monthly updates tospecified legislative committees. Requires such individuals to enroll in a Medi-Calmanaged care health plan.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 36 AUTHOR: Hernandez [D]TITLE: Medi-Cal: Demonstration ProjectSUMMARY: Authorizes the Director of Health Care Services, if federal assurances regarding a

demonstration project under the Medi-Cal program that includes better carecoordination for seniors and persons with disability and to reduce the number ofuninsured individuals, to request temporary extension until the approved effectivedate of the project. Provides the required actions to be performed by theDepartment of Health Care Services subsequent to federal approval.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 43 AUTHOR: Hernandez [D]TITLE: Health Care Coverage: Essential Health BenefitsSUMMARY: Prohibits, for an individual or small group health care service plan contract or an

individual or an small group health insurance policy limits on habilitative andrehabilitative services from being combined on health care service plans or policies.Revises the definition of such services. Authorizes the Department of ManagedHealth Care and the Department of Insurance to adopt emergency regulationsimplementing amendments made to provisions under the federal Patient Protectionand Affordable Care Act.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 75 AUTHOR: Senate Budget & Fiscal Review CommitteeTITLE: HealthSUMMARY: Provides provisions regarding health to include Medicaid clinical labs quality

control, nursing facility licensing, long-term care facility and hospital complaints,breast and cervical cancer screening, the Food Safety Fund, clean needle and syringeexchange, persons with HIV drug treatment, Hepatitis C Care Project, Medi-Caldental treatment for children, Major Medical Insurance Program, gamblingtreatment, emergency medical transportation, Medi-Cal provider payments, and theState Health Benefit Exchange.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

129

Government Affairs

SB 79 AUTHOR: Senate Budget & Fiscal Review CommitteeTITLE: Human ServicesSUMMARY: Provides provisions regarding human services to include suspension of funds to

counties for a high rate of child support collection, fees for criminal records checksfor community care facilities and day care facilities, the Fund for Senior Citizens,unemployment information to forecast social service programs, CalWORKseligibility, the Relative Caregiver Funding Option Program, refugee services,payments to local child support agencies, vehicle license fees, sales tax proceeds, andCalFresh eligibility.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 82 AUTHOR: Senate Budget & Fiscal Review CommitteeTITLE: Human ServicesSUMMARY: Relates to developmental services to include the leasing of developmental center

grounds, the requirement that facilities for developmental disabled have securedperimeters, plans to close more developmental centers, eligibility for a specifieddevelopmental centers, reports on savings from center closures, providing a copy ofindividual program plans to clients and reporting of that requirement, center annualperformance objectives, center provider rates and minimum wage, overtime forHISS services.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 125 AUTHOR: Hernandez [D]TITLE: Health Care CoverageSUMMARY: Extends annual enrollment periods under the federal Patient Protection and

Affordable Care Act and the Knox-Keene Health Care Services Plan Act. Requeststhe University of California to include essential health benefits and the impact of theState Health Benefit Exchange in a specified analysis, and to assess legislation thatimpacts benefit design, cost sharing, and premiums. Defines small employer.Extends the Health Benefit Review Program and an annual charge on health serviceplans and insurers.

POSITION: Support, CAHP – Support, LHPC – SupportSPONSOR: N/ADISPOSITION: Enacted

SB 137 AUTHOR: Hernandez [D]TITLE: Health Care Coverage: Provider DirectoriesSUMMARY: Requires a health care service plan and certain insurers that contracts with

provisions for alternative rates of payment, to publish and maintain a relatedprovider directory or directories, and to make such directory or directories availableon the plan's or insurer's Internet Web site. Requires the development of directorystandards. Requires assurances of correct directory information and periodicupdates. Requires reimbursement for any amount paid for the difference of in-network services.

POSITION: Watch, CAHP – Concerns, LHPC – WatchSPONSOR: N/ADISPOSITION: Enacted

130

Government Affairs

SB 147 AUTHOR: Hernandez [D]TITLE: Federally Qualified Health CentersSUMMARY: Requires the Department of Health Services to authorize a pilot project for federally

qualified health centers that agree to participate for a specified time period. Requiresthe determination of the supplemental capitation amount for each aid category to bepaid to each principal health plan that contains at least one participating center in itsprovider network. Requires contracting with an independent entity to perform anevaluation of the pilot project.

POSITION: Co-Sponsor, CAHP – Watch, LHPC - WatchSPONSOR: L.A. Care, CPCA, CAPHDISPOSITION: Enacted

SB 272 AUTHOR: Hertzberg [D]TITLE: State Public Records Act: Local Agencies: InventorySUMMARY: Requires each local agency, in implementing the State Public Records Act, to create

a catalog of enterprise systems, to make the catalog publicly available upon requestin the office of the person or officer designated by the agency's legislative body, andto post the catalog on the local agency's Internet Web site. Requires the catalog todisclose a list of the systems utilized by the agency and, among other things, thecurrent system vendor and product, citing the justification therefor.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 276 AUTHOR: Wolk [D]TITLE: Medi-Cal: Local Educational AgenciesSUMMARY: Requires the State Department of Health Care Services to seek federal financial

participation for covered services provided by local educational agencies to aneligible Medi-Cal beneficiary regardless of an individualized education plan orindividualized family service plan, or whether the same services are provided at nocharge if the local agency pursues payment from liable parties. Expands a localeducational agency to include a charter school. Relates to case management services.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 277 AUTHOR: Pan [D]TITLE: Public Health: VaccinationsSUMMARY: Eliminates the exemption from existing specified immunization requirements based

upon personal beliefs. Allows an exemption from future requirements deemedappropriate by the State Department of Public Health for either medical reasons orpersonal beliefs, and provides details. Exempts pupils in specified programs.Provides an temporary exclusion is only for a child who has been exposed to aspecified disease and whose proof of status does not show proof of immunizationagainst one of specified diseases.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

131

Government Affairs

SB 282 AUTHOR: Hernandez [D]TITLE: Health Care Coverage: Prescription DrugsSUMMARY: Authorizes the prescribing provider to additionally use an electronic process

developed specifically for transmitting prior authorization information that meets aspecified standard for electronic prior authorization standards. Requiresdevelopment of a prior authorization form. Provides when prior authorizationprovisions do not apply. Relates to a health care service plan grievance process.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 337 AUTHOR: Pavley [D]TITLE: Physicians AssistantsSUMMARY: Requires the medical record of each episode of care for a patient, identify the

physician and surgeon who is responsible for the supervision of the physicianassistant. Authorizes a physician assistant, while under prescribed supervision of aphysician and surgeon, to administer or provide medication to a patient, or transmitorally, or in writing on a patient's record or in a drug order, an order to a personwho may lawfully furnish the medication or medical device. Establishes an recordreview.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 388 AUTHOR: Mitchell [D]TITLE: Health Care Coverage: Solicitation and EnrollmentSUMMARY: Relates to group health and health insurers providing a written summary of benefits

and coverage under the Patient Protection and Affordable Care Act. Provides thatsummary constitutes a vital document and would require a plan or insurer to complywith requirements applicable to those documents. Requires the development oftranslations of the template uniform summary of benefits and coverage and to makethose translations available in specified languages on respective Internet Web sites.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 407 AUTHOR: Morrell [R]TITLE: Comprehensive Perinatal Services Program: MidwivesSUMMARY: Amends the Comprehensive Perinatal Services Program. Authorizes a health care

provider to employ or contract licensed midwives for the purpose of providingcomprehensive perinatal services. Provides that a licensed midwife shall be eligibleto serve as a comprehensive perinatal provider. Requires the State Department ofHealth Care Services to commence the revision of existing regulations as itdetermines are necessary for the implementation of these provisions.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

132

Government Affairs

SB 408 AUTHOR: Morrell [R]TITLE: Midwife AssistantsSUMMARY: Authorizes a midwife assistant to perform assistive activities under the supervision

of a licensed midwife or certified nurse-midwife, including the administration ofmedicine, the withdrawing of blood, and midwife technical support services.Prohibits a midwife assistant from being employed for inpatient care in a licensedgeneral acute care hospital.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 570 AUTHOR: Jackson [D]TITLE: Personal Information: Privacy: BreachSUMMARY: Amends existing law requiring a person or business conducting business in the State

and any agency that owns or licenses computerized data that includes personalinformation to disclose a breach of the security of the system in the most expedienttime possible and without unreasonable delay. Provides the format and contents ofthe breach notification. Prescribes a model security breach notification form.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

SB 671 AUTHOR: Hill [D]TITLE: Pharmacy: Biological ProductSUMMARY: Authorizes a pharmacist to select an alternative biological product when filling a

prescription order for a prescribed biological product if the alternative biologicalproduct is interchangeable and the prescriber does not personally indicate that asubstitution is not to be made. Requires a pharmacist or a designee to make anelectronically accessible entry in a described entry system of the specified biologicalproduct provided to the patient, and provides an alternative method thereto.

POSITION: Watch, CAHP - OpposeSPONSOR: N/ADISPOSITION: Enacted

Special Session Legislation

ABX2 15 AUTHOR: Eggman [D]TITLE: End of LifeSUMMARY: Enacts the End of Life Option Act. Authorizes a qualified adult to make a request

for a drug for the purpose of ending their life. Establishes procedures and forms.Prohibits a will, or other agreement, from being conditioned upon or affected by aperson making or rescinding a request for such drug. Prohibits the sale of insuranceconditioned or affected by such request. Provides for an exception from civil andcriminal liability and professional discipline. Provides for a felony for specifiedviolations.

POSITION: WatchSPONSOR: N/ADISPOSITION: Enacted

133

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137

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. FIN 111.1115

Committee: Finance & Budget Chairperson: Michael Rembis

Issue: Acceptance of the Financial Report for the ten months ended August 31, 2015. Background:

Budget Impact:

Motion: To accept the Financial Report for the ten months ended August 31, 2015, as submitted.

138

8/31/2015

Financial Performance August 2015

139

Financial Performance Results Highlights August 2015

Overall

Plan Partners

Medi-Cal Direct (MCLA)

Cal MediConnect (CMC)

Total enrollment for August is 1,829,137 members. Membership is slightly above the budget. However, the member months are 374,108 favorable,

driven by higher than expected growth in MediCal Expansion, offset by lower than expected enrollment from Plan Partners, L.A. Care Covered, and

Cal MediConnect. Fiscal year-to-date (eleven months) performance is a surplus of $179.5 million or 3.1% on revenue of $5.8 billion, and is $114.6

million favorable to plan. The favorable budget variance is driven by lower than expected healthcare expenses and administrative savings.

Total enrollment for August is 884,607 members which is 24,560 members unfavorable to the budget. Fiscal year-to-date performance is a surplus of

$76.6 million, and is $36.9 million favorable to plan. The favorable budget variance is driven by lower than expected healthcare expenses, which

include retroactive rate adjustments and administrative savings.

Total enrollment for August is 867,556 members. Fiscal year-to-date performance is a surplus of $143.4 million, and is $79.1 million favorable to plan

driven by higher than expected revenue resulting from enrollment growth in MediCal Expansion and administrative savings.

Cal MediConnect is operated as a separate line of business that launched in April 2014. Total enrollment for August is 14,910 members, which

include members from Medicare D-SNP members selecting CMC (with the closure of L.A. Care's D-SNP product) and passive enrollment. Fiscal

year-to-date performance is a deficit of $28.5 million and is $14.4 million unfavorable to budget driven by lower than expected membership growth

and revenue rates.

140

Financial Performance Results Highlights August 2015

L.A. Care Covered (LACC)

Medicare

PASC-SEIU

Healthy Kids

Community Programs

HITEC-LA

Total enrollment for August is 45,762 members. Fiscal year-to-date performance is a deficit of $870,000, and is $761,000 unfavorable to plan driven

by higher than budgeted operating expenses.

Total enrollment for August is 418 members. Fiscal year-to-date performance is a surplus of $196,000, and is $166,000 favorable to plan. The First

Five LA Commission has approved an extension of the program through September, 2016.

Fiscal year-to-date performance is a deficit of $7.2 million, and is $2.8 million favorable to plan driven by lower than budgeted grant expense.

The federal grant is drawn-down based upon expenses incurred. Fiscal year-to-date performance is a deficit of $128,000, and is $21,000 favorable to

plan.

L.A. Care Covered enrollment for August is 15,877 members. Membership is substantially lower than plan. Fiscal year-to-date performance is a

deficit of $10.7 million, and is $3.8 million unfavorable to plan driven by lower than expected revenue resulting from lower enrollment and Risk

Adjustments from Covered California. The adjustments were retroactive to the January 2014 product launch.

L.A. Care closed its Medicare D-SNP product line as of December 31, 2014. Fiscal year-to-date performance is a surplus of $8.6 million, and is $10.1

million favorable to plan driven by higher than expected revenue and lower than budgeted healthcare expenses.

141

Combined Operations Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

1,829,137 1,810,674 18,463 Current Membership 1,829,137 1,807,868 21,269

1,849,253 1,831,985 17,268 Member Months 19,164,272 18,790,164 374,108

Revenue

$569,159 307.78 $516,021 281.67 $53,137 26.10 Capitation $5,648,897 294.76 $5,903,572 314.18 ($254,676) (19.42)

10,829 5.86 7,821 4.27 3,008 1.59 Maternity Kick 112,179 5.85 122,061 6.50 (9,882) (0.64)

2 0.00 47 0.03 (45) (0.02) Premiums 252 0.01 491 0.03 (239) (0.01)

67 0.04 60 0.03 7 0.00 Grants/Others 1,605 0.08 1,336 0.07 269 0.01

580,058 313.67 523,949 286.00 56,108 27.67 Total Revenues 5,762,933 300.71 6,027,460 320.78 (264,527) (20.07)

Healthcare Expenses

254,484 153.05 274,853 150.03 (20,369) 3.02 Capitation 3,080,142 162.21 3,186,290 169.57 106,148 7.36

6,111 3.30 5,263 2.87 848 0.43 Maternity Kick 70,869 3.70 80,315 4.27 9,446 0.58

15,439 8.35 (5,229) (2.85) 20,669 11.20 Provider Incentives and Shared Risk 126,771 6.61 123,759 6.59 (3,011) (0.03)

92,237 49.88 84,988 46.39 7,250 3.49 Inpatient Claims 834,575 43.55 926,393 49.30 91,818 5.75

116,456 62.97 88,164 48.12 28,292 14.85 Outpatient Claims 786,353 41.03 956,331 50.90 169,978 9.86

40,944 22.14 36,871 20.13 4,073 2.01 Pharmacy 394,954 20.61 357,871 19.05 (37,083) (1.56)

6,003 3.25 6,807 3.72 (804) (0.47) Medical Administrative Expenses 75,752 3.95 93,118 4.96 17,366 1.00

531,674 302.94 491,716 268.41 39,958 34.53 Total Healthcare Expenses 5,369,416 281.67 5,724,078 304.63 354,662 22.96

MCR(%)

48,384 10.73 32,233 17.59 16,150 (6.86) Operating Margin 393,517 19.04 303,382 16.15 90,135 2.90

21,192 11.46 21,277 11.61 (85) (0.15) Total Operating Expenses 213,200 11.12 229,621 12.22 16,422 1.10

Admin Ratio(%)

27,191 (0.73) 10,956 5.98 16,235 (6.71) Income from Operations 180,317 7.92 73,760 3.93 106,557 3.99

(932) (0.50) (2,502) (1.37) 1,570 0.86 Total Non-Operating Income (Expense) (817) (0.04) (8,811) (0.47) 7,994 0.43

$26,259 (1.23) $8,454 4.61 $17,805 (5.85) Net Surplus(Deficit) $179,500 7.88 $64,949 3.46 $114,551 4.42

Margin(%)

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

1.8%

Month Month (Decrease) Actual Budget Budget

91.7% 93.8% -2.2% 93.2% 95.0%

1.1% 2.0%

3.7% 4.1% -0.4% 3.7% 3.8% 0.1%

4.5% 1.6% 2.9% 3.1%

142

MediCal Plan Partner Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

884,607 877,532 7,075 Current Membership 884,607 909,167 (24,560)

896,347 889,483 6,864 Member Months 9,455,801 9,633,970 (178,169)

Revenue

$208,423 232.52 $186,325 209.48 $22,098 23.05 Capitation $2,098,051 221.88 $2,153,829 223.57 ($55,778) (1.69)

5,120 5.71 5,179 5.82 (60) (0.11) Maternity Kick 66,638 7.05 76,263 7.92 (9,625) (0.87)

213,543 238.24 191,505 215.30 22,038 22.94 Total Revenues 2,164,688 228.93 2,230,092 231.48 (65,404) (2.56)

Healthcare Expenses

188,256 231.36 167,421 188.22 20,835 43.14 Capitation 1,943,793 207.59 2,023,279 210.02 79,485 2.43

4,712 5.26 4,777 5.37 (65) (0.11) Maternity Kick 61,412 6.49 69,965 7.26 8,553 0.77

1,810 2.02 1,747 1.96 62 0.05 Provider Incentives and Shared Risk 23,866 2.52 31,419 3.26 7,553 0.74

419 0.47 10 0.01 408 0.46 Outpatient Claims 1,617 0.17 0 - (1,617) (0.17)

767 0.86 796 0.89 (29) (0.04) Medical Administrative Expenses 9,971 1.05 14,507 1.51 4,536 0.45

195,964 239.96 174,752 196.46 21,212 43.49 Total Healthcare Expenses 2,040,660 217.83 2,139,170 222.04 98,511 4.21

MCR(%)

17,579 (1.72) 16,753 18.83 826 (20.56) Operating Margin 124,029 11.09 90,922 9.44 33,107 1.66

4,602 5.13 4,895 5.50 (294) (0.37) Total Operating Expenses 47,420 5.01 51,216 5.32 3,796 0.30

Admin Ratio(%)

12,978 (6.85) 11,858 13.33 1,120 (20.19) Income from Operations 76,608 6.08 39,705 4.12 36,903 1.96

$12,978 (6.85) $11,858 13.33 $1,120 (20.19) Net Surplus(Deficit) $76,608 6.08 $39,705 4.12 $36,903 1.96

Margin(%)

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

1.7%

Month Month (Decrease) Actual Budget Budget

91.8% 91.3% 0.5% 94.3% 95.9%

1.8%

2.2% 2.6% -0.4% 2.2% 2.3% 0.1%

6.1% 6.2% -0.1% 3.5% 1.8%

143

MCLA Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

867,556 854,526 13,030 Current Membership 867,556 765,662 101,894

873,997 861,251 12,746 Member Months 8,790,432 7,856,352 934,080

Revenue

$323,445 370.08 $285,897 331.96 $37,548 38.12 Capitation $3,156,728 359.11 $2,834,365 360.77 $322,362 (1.66)

5,709 6.53 2,641 3.07 3,068 3.47 Maternity Kick 45,542 5.18 45,798 5.83 (257) (0.65)

329,154 376.61 288,539 335.02 40,615 41.59 Total Revenues 3,202,269 364.29 2,880,163 366.60 322,106 (2.31)

Healthcare Expenses

42,530 48.66 84,632 98.27 (42,102) (49.60) Capitation 887,943 101.01 768,430 97.81 (119,514) (3.20)

1,399 1.60 486 0.56 913 1.04 Maternity Kick 9,457 1.08 10,350 1.32 893 0.24

13,699 15.67 6,998 8.13 6,702 7.55 Provider Incentives and Shared Risk 103,273 11.75 78,036 9.93 (25,236) (1.82)

80,780 92.43 68,157 79.14 12,623 13.29 Inpatient Claims 765,033 87.03 730,495 92.98 (34,538) 5.95

113,862 130.28 86,624 100.58 27,238 29.70 Outpatient Claims 765,397 87.07 788,205 100.33 22,808 13.26

38,856 44.46 34,336 39.87 4,519 4.59 Pharmacy 367,868 41.85 269,661 34.32 (98,207) (7.52)

3,923 4.49 3,909 4.54 14 (0.05) Medical Administrative Expenses 44,210 5.03 47,020 5.98 2,810 0.96

295,049 337.59 285,141 331.08 9,907 6.51 Total Healthcare Expenses 2,943,182 334.82 2,692,197 342.68 (250,985) 7.86

MCR(%)

34,106 39.02 3,397 3.94 30,708 35.08 Operating Margin 259,088 29.47 187,967 23.93 71,121 5.55

11,434 13.08 12,089 14.04 (656) (0.95) Total Operating Expenses 115,698 13.16 123,707 15.75 8,009 2.58

Admin Ratio(%)

22,672 25.94 (8,692) (10.09) 31,364 36.03 Income from Operations 143,389 16.31 64,259 8.18 79,130 8.13

$22,672 25.94 ($8,692) (10.09) $31,364 36.03 Net Surplus(Deficit) $143,389 16.31 $64,259 8.18 $79,130 8.13

Margin(%)

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

1.6%

Month Month (Decrease) Actual Budget Budget

89.6% 98.8% -9.2% 91.9% 93.5%

2.2%

3.5% 4.2% -0.7% 3.6% 4.3% 0.7%

6.9% -3.0% 9.9% 4.5% 2.2%

144

CMC Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

14,910 15,896 (986) Current Membership 14,910 35,300 (20,390)

14,452 15,052 (600) Member Months 136,671 259,244 (122,573)

Revenue

$19,833 1,372.34 $23,069 1,532.60 ($3,236) (160.26) Capitation $191,672 1,402.43 $611,111 2,357.28 ($419,439) (954.85)

19,833 1,372.34 23,069 1,532.60 (3,236) (160.26) Total Revenues 191,672 1,402.43 611,111 2,357.28 (419,439) (954.85)

Healthcare Expenses

8,706 602.38 9,037 600.42 (332) 1.96 Capitation 88,246 645.68 183,978 709.67 95,732 63.99

960 66.44 1,035 68.76 (75) (2.32) Provider Incentives and Shared Risk 9,919 72.58 3,737 14.41 (6,183) (58.16)

11,977 828.72 16,369 1,087.49 (4,392) (258.77) Inpatient Claims 54,148 396.19 177,755 685.67 123,607 289.47

1,994 138.00 1,082 71.88 912 66.11 Outpatient Claims 17,033 124.63 143,106 552.01 126,072 427.38

569 39.39 1,178 78.24 (608) (38.85) Pharmacy 14,827 108.49 72,689 280.39 57,862 171.90

999 69.15 1,785 118.56 (785) (49.42) Medical Administrative Expenses 16,882 123.52 23,238 89.64 6,356 (33.88)

25,205 1,744.08 30,486 2,025.36 (5,280) (281.28) Total Healthcare Expenses 201,055 1,471.09 604,503 2,331.79 403,447 860.70

MCR(%)

(5,372) (371.74) (7,417) (492.76) 2,045 121.02 Operating Margin (9,384) (68.66) 6,608 25.49 (15,992) (94.15)

1,866 129.12 1,970 130.86 (104) (1.74) Total Operating Expenses 19,161 140.20 20,797 80.22 1,635 (59.98)

Admin Ratio(%)

(7,238) (500.86) (9,387) (623.62) 2,148 122.76 Income from Operations (28,545) (208.86) (14,188) (54.73) (14,357) (154.13)

($7,238) (500.86) ($9,387) (623.62) $2,148 122.76 Net Surplus(Deficit) ($28,545) (208.86) ($14,188) (54.73) ($14,357) (154.13)

Margin(%)

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

-6.0%

Month Month (Decrease) Actual Budget Budget

127.1% 132.2% -5.1% 104.9% 98.9%

-2.3% -12.6%

9.4% 8.5% 0.9% 10.0% 3.4% -6.6%

-36.5% -40.7% 4.2% -14.9%

145

L.A. Care Covered Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

15,877 16,365 (488) Current Membership 15,877 48,161 (32,284)

18,210 19,615 (1,405) Member Months 238,400 466,131 (227,731)

Revenue

$3,289 180.61 $6,517 332.23 ($3,228) (151.62) Capitation $14,566 61.10 $110,982 238.09 ($96,416) (176.99)

2 0.12 47 2.38 (45) (2.27) Premiums 250 1.05 466 1.00 (216) 0.05

3,291 180.73 6,563 334.61 (3,272) (153.88) Total Revenues* 14,816 62.15 111,448 239.09 (96,633) (176.95)

Healthcare Expenses

2,662 146.20 1,409 71.84 1,253 74.36 Capitation 13,918 58.38 57,557 123.48 43,639 65.10

(546) (29.97) (14,039) (715.74) 13,493 685.77 Provider Incentives and Shared Risk (9,464) (39.70) 9,232 19.81 18,696 59.50

111 6.10 503 25.66 (392) (19.57) Inpatient Claims 4,185 17.55 6,285 13.48 2,100 (4.07)

60 3.27 202 10.29 (142) (7.02) Outpatient Claims (1,085) (4.55) 17,934 38.47 19,019 43.03

353 19.36 346 17.66 6 1.70 Pharmacy 3,895 16.34 4,410 9.46 515 (6.88)

116 6.38 121 6.18 (5) 0.20 Medical Administrative Expenses 1,495 6.27 5,046 10.83 3,551 4.56

2,756 151.34 (11,457) (584.10) 14,213 735.44 Total Healthcare Expenses 12,943 54.29 100,464 215.53 87,520 161.23

MCR(%)

535 29.39 18,021 918.72 (17,485) (889.32) Operating Margin 1,873 7.86 10,985 23.57 (9,112) (15.71)

1,490 81.84 810 41.29 681 40.56 Total Operating Expenses 10,326 43.32 13,574 29.12 3,248 (14.19)

Admin Ratio(%)

(955) (52.45) 17,211 877.43 (18,166) (929.88) Income from Operations (8,454) (35.46) (2,589) (5.55) (5,865) (29.91)

(149) (8.19) (48) (2.45) (101) (5.74) Total Non-Operating Income (Expense) (2,287) (9.59) (4,388) (9.41) 2,101 (0.18)

($1,104) (60.64) $17,163 874.99 ($18,267) (935.62) Net Surplus(Deficit) ($10,741) (45.05) ($6,977) (14.97) ($3,763) (30.08)

Margin(%)

* Revenue reflects retroactive adjustments to January 2014.

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

2.8%

Month Month (Decrease) Actual Budget Budget

83.7% -174.6% 258.3% 87.4% 90.1%

-66.2%

45.3% 12.3% 32.9% 69.7% 12.2% -57.5%

-33.6% 261.5% -295.0% -72.5% -6.3%

146

Medicare Financial Statement ($ in thousands)

($) ($) ($) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

0 0 0 Current Membership 0 0 0

(3) (10) 7 Member Months 26,706 26,052 654

Revenue

($6) $0 ($6) Medicare Part C $27,054 1,013.03 $25,270 970.00 $1,784 43.03

(0) (1) 0 Medicare Part D 2,485 93.03 0 - 2,485 93.03

(7) (1) (6) Total Revenues 29,539 1,106.06 25,270 970.00 4,268 136.06

Healthcare Expenses

50 0 50 Capitation 10,963 410.52 9,898 379.95 (1,065) (30.57)

(486) (968) 482 Provider Incentives and Shared Risk (864) (32.36) 592 22.73 1,456 55.09

(704) (304) (400) Inpatient Claims 7,678 287.49 7,748 297.42 71 9.93

(26) 4 (30) Outpatient Claims 1,456 54.53 2,364 90.74 908 36.21

17 50 (32) Pharmacy (1,461) (54.72) 2,214 85.00 3,676 139.72

(0) (0) (0) Medical Administrative Expenses 1,075 40.26 1,350 51.81 275 11.55

(1,149) (1,219) 70 Total Healthcare Expenses 18,847 705.72 24,167 927.64 5,320 221.92

MCR(%)

1,142 1,218 (76) Operating Margin 10,692 400.34 1,104 42.36 9,588 357.98

0 0 (0) Total Operating Expenses 2,069 77.46 2,570 98.65 501 21.18

Admin Ratio(%)

1,142 1,218 (76) Income from Operations 8,623 322.88 (1,466) (56.29) 10,089 379.17

$1,142 $1,218 ($76) Net Surplus(Deficit) $8,623 322.88 ($1,466) (56.29) $10,089 379.17

Margin(%)

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

31.8%

Month Month (Decrease) Actual Budget Budget

63.8% 95.6%

35.0%

7.0% 10.2% 3.2%

29.2% -5.8%

147

PASC-SEIU Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

45,762 45,937 (175) Current Membership 45,762 49,578 (3,816)

45,815 46,175 (360) Member Months 512,194 541,233 (29,039)

Revenue

$14,122 308.24 $14,161 306.69 ($39) 1.55 Capitation $157,844 308.17 $166,759 308.11 ($8,915) 0.06

14,122 308.24 14,161 306.69 (39) 1.55 Total Revenues 157,844 308.17 166,759 308.11 (8,915) 0.06

Healthcare Expenses

12,266 267.72 12,340 267.25 (75) 0.47 Capitation 135,147 263.86 142,910 264.05 7,764 0.19

0 - 0 - 0 - Provider Incentives 0 - 9 0.02 9 0.02

73 1.60 265 5.74 (192) (4.14) Inpatient Claims 3,538 6.91 4,059 7.50 521 0.59

147 3.21 240 5.19 (93) (1.98) Outpatient Claims 1,966 3.84 4,600 8.50 2,634 4.66

1,146 25.02 958 20.75 188 4.27 Pharmacy 9,793 19.12 8,850 16.35 (944) (2.77)

197 4.29 195 4.22 2 0.07 Medical Administrative Expenses 2,103 4.11 1,939 3.58 (165) (0.52)

13,829 301.84 13,998 303.15 (169) (1.31) Total Healthcare Expenses 152,548 297.83 162,367 299.99 9,819 2.16

MCR(%)

293 6.40 163 3.53 130 2.86 Operating Margin 5,296 10.34 4,392 8.12 904 2.22

565 12.34 596 12.91 (31) (0.57) Total Operating Expenses 6,167 12.04 4,502 8.32 (1,665) (3.72)

Admin Ratio(%)

(272) (5.94) (433) (9.37) 161 3.43 Income from Operations (870) (1.70) (110) (0.20) (761) (1.50)

($272) (5.94) ($433) (9.37) $161 3.43 Net Surplus(Deficit) ($870) (1.70) ($110) (0.20) ($761) (1.50)

Margin(%)

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

0.7%

Month Month (Decrease) Actual Budget Budget

97.9% 98.8% -0.9% 96.6% 97.4%

-0.1% -0.5%

4.0% 4.2% -0.2% 3.9% 2.7% -1.2%

-1.9% -3.1% 1.1% -0.6%

148

Healthy Kids 0-5 Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

418 411 7 Current Membership 418 0 418

416 411 5 Member Months 3,990 7,182 (3,192)

Revenue

$49 117.00 $48 117.00 $1 - Capitation $467 117.08 $1,256 174.82 ($788) (57.74)

0 0.35 0 0.36 (0) (0.01) Premiums 2 0.43 25 3.42 (23) (2.99)

49 117.35 48 117.36 1 (0.01) Total Revenues 469 117.51 1,280 178.24 (811) (60.73)

Healthcare Expenses

14 32.64 13 32.64 0 0.00 Capitation 131 32.81 240 33.35 109 0.54

1 3.27 (4) (10.31) 6 13.58 Provider Incentives and Shared Risk 38 9.51 735 102.28 697 92.78

0 0.14 (0) (0.73) 0 0.87 Inpatient Claims (3) (0.70) 50 7.00 53 7.70

0 1.11 2 4.70 (1) (3.59) Outpatient Claims (13) (3.21) 122 17.00 135 20.21

1 2.89 3 7.01 (2) (4.12) Pharmacy 26 6.57 47 6.49 20 (0.08)

1 3.43 2 3.66 (0) (0.23) Medical Administrative Expenses 15 3.66 18 2.44 3 (1.22)

18 43.48 15 36.97 3 6.51 Total Healthcare Expenses 194 48.64 1,211 168.57 1,017 119.93

MCR(%)

31 73.87 33 80.39 (2) (6.52) Operating Margin 275 68.87 69 9.67 205 59.20

4 9.34 4 8.94 0 0.41 Total Operating Expenses 78 19.67 40 5.51 (39) (14.16)

Admin Ratio(%)

27 64.53 29 71.46 (3) (6.93) Income from Operations 196 49.20 30 4.16 166 45.03

$27 64.53 $29 71.46 ($3) (6.93) Net Surplus(Deficit) $196 49.20 $30 4.16 $166 45.03

Margin(%)

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

53.2%

Month Month (Decrease) Actual Budget Budget

37.1% 31.5% 5.6% 41.4% 94.6%

39.5%

8.0% 7.6% 0.3% 16.7% 3.1% -13.6%

55.0% 60.9% -5.9% 41.9% 2.3%

149

Community Programs Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

0 0 0 Current Membership 0 0 0

0 0 0 Member Months 0 0 0

Revenue

$39 - $39 - ($0) - Grants/Others $472 - $0 - $472 -

39 - 39 - (0) - Total Revenues 472 - 0 - 472 -

0 - 0 - 0 - Total Healthcare Expenses 0 - 0 - 0 -

39 - 39 - (0) - Operating Margin 472 - 0 - 472 -

532 - 334 - 198 - Total Operating Expenses 5,175 - 5,315 - 140 -

(494) - (295) - (199) - Income from Operations (4,703) - (5,315) - 612 -

(462) - 0 - (462) - Total Non-Operating Income (Expense) (2,447) - (4,583) - 2,137 -

($955) 0.00 ($295) 0.00 ($660) 0.00 Net Surplus(Deficit) ($7,150) 0.00 ($9,898) 0.00 $2,749 0.00

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

Month Month (Decrease) Actual Budget Budget

150

HITEC-LA Financial Statement ($ in thousands)

($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM) ($) (PMPM)

Membership

0 0 0 Current Membership 0 0 0

0 0 0 Member Months 0 0 0

Revenue

$29 - $21 - $8 - Grants/Others $1,133 - $1,336 - ($203) -

29 - 21 - 8 - Total Revenues 1,133 - 1,336 - (203) -

0 - 0 - 0 - Total Healthcare Expenses 0 - 0 - 0 -

29 - 21 - 8 - Operating Margin 1,133 - 1,336 - (203) -

34 - 24 - 10 - Total Operating Expenses 1,261 - 1,484 - 223 -

(5) - (2) - (3) - Income from Operations (128) - (148) - 21 -

($5) 0.00 ($2) 0.00 ($3) 0.00 Net Surplus(Deficit) ($128) 0.00 ($148) 0.00 $21 0.00

August 2015

Current Prior Increase YTD YTD Fav<Unfav>

Month Month (Decrease) Actual Budget Budget

151

Comparative Balance Sheet

(Dollars in thousands) Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15

ASSETS

CURRENT ASSETS

Total Current Assets 2,132,513 1,955,883 2,281,861 2,384,970 2,204,007 2,434,814

Capitalized Assets - net 35,219 37,286 37,918 39,420 41,974 43,182

NON-CURRENT ASSETS 10,315 10,300 10,280 9,840 9,806 9,806

TOTAL ASSETS 2,178,047 2,003,469 2,330,059 2,434,230 2,255,787 2,487,802

LIABILITIES AND FUND EQUITY

Total Current Liability 1,889,970 1,717,348 2,004,215 2,065,720 1,878,828 2,084,589

Long Term Liability 3,661 3,657 3,652 3,648 3,643 3,639

Total Liabilities 1,893,631 1,721,004 2,007,867 2,069,368 1,882,472 2,088,228

FUND EQUITY

Invested in Capital Assets, net of related debt 35,219 37,286 37,918 39,420 41,974 43,182

Restricted Equity 300 300 300 300 300 300

Minimum Tangible Net Equity 111,888 120,052 121,437 125,167 128,133 136,153

Board Designated Funds 137,008 124,826 162,537 199,974 202,908 219,939

Total Fund Equity 284,415 282,465 322,192 364,862 373,316 399,575

TOTAL LIABILITIES AND FUND EQUITY $2,178,045 $2,003,469 $2,330,059 $2,434,230 $2,255,787 $2,487,802

Solvency Ratios

Working Capital Ratio 1.13 1.14 1.14 1.15 1.17 1.17

Cash to Claims Ratio 1.19 1.25 1.15 0.80 1.32 1.36

Tangible Net Equity Ratio 2.54 2.35 2.65 2.91 2.91 2.93

August 2015

152

DATE:

TO:

FROM:

October 15, 2015

Finance & Budget Committee

Timothy Reilly, Chief Financial Officer

SUBJECT: Monthly Investment Transaction Report – September 2015

In order to keep the Committee apprised of L.A. Care’s investment portfolios and to comply with California government code section #53607, presented herein are the investment transaction details from September 1, 2015, to September 30, 2015.

As of September 30, 2015, L.A. Care's total investments market value was $1.63 billion. This includes approx. $50 million invested with the Los Angeles County Pooled Investment Fund (LACPIF) and $10 million invested with the Local Agency Investment Fund (LAIF). These government pooled funds are overseen by the County Treasurer (LACPIF) and State Treasurer’s Office (LAIF). The remainder, $1.57 billion, is managed by Payden & Rygel, an external professional asset management firm and is divided to two separate portfolios based on investment style,

1. The Short-term Portfolio and2. The Extended Portfolio

Presented herewith the transactions related to these two portfolios.

153

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN-LOW DURATION PORT 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/03/15 09/08/15 Buy 800,000.000 SUMITOMO MITSUI YCD 01/07/16 0.37 86563R2Z0 (800,000.00) (800,000.00)

09/08/15 09/10/15 Buy 800,000.000 BNP PARIBAS YCD 12/10/15 0.32 05574RB95 (800,000.00) (800,000.00)

09/08/15 09/10/15 Buy 800,000.000 BANK OF TOKYO-MITSUBISHI Y 11/02/15 0.23 06538J5K8 (800,000.00) (800,000.00)

09/08/15 09/10/15 Buy 800,000.000 LLOYDS BANK YCD 01/21/16 0.38 53945GKR1 (800,000.00) (800,000.00)

09/08/15 09/15/15 Buy 170,000.000 HOME DEPOT FRN 09/15/17 0.71 437076BJ0 (170,000.00) (170,000.00)

09/18/15 09/22/15 Buy 2,000,000.000 FHLMC DISCOUNT NOTE 10/30/15 313396NQ (1,999,883.89) (1,999,883.89)

09/28/15 09/29/15 Buy 2,800,000.000 FHLB DISCOUNT NOTE 10/16/15 313384NA3 (2,799,947.11) (2,799,947.11) 8,170,000.000 (8,169,831.00) (8,169,831.00)

09/01/15 09/01/15 Coupon CISCO SYSTEMS FRN 03/01/19 0.82 17275RAQ 400.07 400.07

09/01/15 09/01/15 Coupon ILLINOIS TOOL WORKS 02/25/17 0.90 452308AS8 1,800.00 1,800.00

09/01/15 09/01/15 Coupon ELI LILLY & CO 03/01/18 1.25 532457BK3 611.11 611.11

09/01/15 09/01/15 Coupon PNC BANK FRN 06/01/18 0.74 69353REN4 897.96 897.96

09/02/15 09/02/15 Coupon CHEVRON FRN 03/02/18 0.50 166764AW 487.03 487.03

09/02/15 09/02/15 Coupon CHEVRON 03/02/18 1.37 166764AV2 1,357.42 1,357.42

09/03/15 09/03/15 Coupon CATERPILLAR FINANCIAL FRN 03/03/17 0.56 14912L5Y3 510.79 510.79

09/03/15 09/03/15 Coupon CISCO SYSTEMS 03/03/17 1.10 17275RAT9 1,595.00 1,595.00

09/06/15 09/06/15 Coupon EXXON MOBIL 03/06/18 1.31 30231GAL6 5,024.25 5,024.25

09/08/15 09/08/15 Coupon MANUFACTURERS & TRADERS F 03/07/16 0.63 55279HAB6 1,227.91 1,227.91

09/08/15 09/08/15 Coupon PACCAR FINANCIAL FRN 06/06/17 0.52 69371RL95 107.85 107.85

09/08/15 09/08/15 Coupon STATE STREET BANK FRN 12/08/15 0.53 85744NAB7 305.96 305.96

Payden & Rygel Page 1154

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN-LOW DURATION PORT 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/08/15 09/08/15 Coupon SUMITOMO MITSUI BANK YCD 09/08/15 0.27 86563RSE9 658.13 658.13

09/09/15 09/09/15 Coupon LLOYDS BANK YCD 09/09/15 0.30 53945GCK5 750.00 750.00

09/09/15 09/09/15 Coupon PACCAR FINANCIAL 03/09/18 1.45 69371RM4 1,160.00 1,160.00

09/10/15 09/10/15 Coupon BNP PARIBAS YCD 09/10/15 0.28 05574RWT 688.33 688.33

09/10/15 09/10/15 Coupon MITSUBISHI UFJ YCD 09/10/15 0.27 60682AXB7 663.75 663.75

09/10/15 09/10/15 Coupon CHARLES SCHWAB 03/10/18 1.50 808513AK1 1,500.00 1,500.00

09/11/15 09/11/15 Coupon US BANK OHIO FRN 09/11/17 0.53 90331HMJ9 521.10 521.10

09/12/15 09/12/15 Coupon TEXAS INSTRUMENTS 03/12/17 0.88 882508AX2 875.00 875.00

09/13/15 09/13/15 Coupon FFCB 1ML FRN 02/13/17 0.25 3133EDFB3 804.11 804.11

09/14/15 09/14/15 Coupon JPMORGAN CHASE FRN 06/13/16 0.67 48121CJM9 700.53 700.53

09/14/15 09/14/15 Coupon WELLS FARGO FRN 09/14/18 0.74 94974BGD 736.15 736.15

09/15/15 09/15/15 Coupon CHASE 2014-A1 A1 CDT 01/15/19 1.15 161571GJ7 479.17 479.17

09/15/15 09/15/15 Coupon CHASE 2015-A3 A CDT 1MOFRN 04/15/19 0.46 161571GW 288.45 288.45

09/15/15 09/15/15 Coupon CISCO SYSTEMS FRN 06/15/18 0.65 17275RAY8 593.25 593.25

09/15/15 09/15/15 Coupon DRYROCK 2014-2 A 1MOFRN CD 03/16/20 0.55 06742LAC7 433.07 433.07

09/15/15 09/15/15 Coupon DRYROCK 2014-2 A 1MOFRN CD 03/16/20 0.55 06742LAC7 433.07 433.07

09/15/15 09/15/15 Coupon HONDA 2014-4 A2 CAR 01/17/17 0.58 43814JAB0 302.65 302.65

09/15/15 09/15/15 Coupon JOHN DEERE 2014-A A3 EQP 04/16/18 0.92 47787VAC5 1,150.00 1,150.00

09/15/15 09/15/15 Coupon JOHN DEERE 2015-A A2A EQP 02/15/18 0.87 47787UAB9 569.13 569.13

09/15/15 09/15/15 Coupon GEORGIA POWER FRN 03/15/16 0.66 373334KB6 356.11 356.11

Payden & Rygel Page 2155

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN-LOW DURATION PORT 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/15/15 09/15/15 Coupon TOYOTA 2013-B A3 CAR 07/17/17 0.89 89236VAC4 490.51 490.51

09/15/15 09/15/15 Coupon TOYOTA 2013-B A3 CAR 07/17/17 0.89 89236VAC4 103.01 103.01

09/15/15 09/15/15 Coupon TOYOTA 2015-A A2 CAR 07/17/17 0.71 89236WAB 272.17 272.17

09/15/15 09/15/15 Coupon TOYOTA 2015-B A2A GREEN CA 11/15/17 0.77 89237CAB7 385.00 385.00

09/15/15 09/15/15 Coupon USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 263.64 263.64

09/17/15 09/17/15 Coupon FFCB 1ML FRN 04/17/17 0.26 3133EDJX1 319.82 319.82

09/18/15 09/18/15 Coupon HONDA 2013-4 A3 CAR 09/18/17 0.69 43814FAC6 481.32 481.32

09/20/15 09/20/15 Coupon VOLKSWAGEN 2013-2 A3 CAR 04/20/18 0.70 92867PAC7 426.63 426.63

09/21/15 09/21/15 Coupon GEDFT 2014-2 A 1MOFRN FLOO 10/20/19 0.67 36159LCN4 583.78 583.78

09/21/15 09/21/15 Coupon HONDA 2015-2 A3 CAR 02/21/19 1.04 43813NAC0 216.67 216.67

09/22/15 09/22/15 Coupon AMERICAN EXPRESS FRN 09/22/17 0.62 0258M0DS 445.28 445.28

09/22/15 09/22/15 Coupon GEEMT 2014-1 A2 EQP 04/24/17 0.64 36163TAB9 192.49 192.49

09/23/15 09/23/15 Coupon GEET 2015-1 A2 EQP 11/24/17 0.89 36164EAB1 155.75 155.75

09/25/15 09/25/15 Coupon BMW 2013-A A3 CAR 11/27/17 0.67 05578XAC2 317.12 317.12

09/01/15 09/25/15 Coupon FHMS K502 A1 CMBS 12/25/16 0.73 3137B03V4 200.32 200.32

09/25/15 09/25/15 Coupon FHMS KF01 A 1MOFRN CMBS 04/25/19 0.55 3137AUP52 17.35 17.35

09/01/15 09/25/15 Coupon FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 7.35 7.35

09/01/15 09/25/15 Coupon FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 2.92 2.92

09/01/15 09/25/15 Coupon FNA 2014-M4 ASQ2 CMBS 01/25/17 1.27 3136AJB21 634.98 634.98

09/01/15 09/25/15 Coupon FNA 2014-M5 FA 1MOFRN CMBS 01/25/17 0.56 3136AJ2A3 77.59 77.59

Payden & Rygel Page 3156

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN-LOW DURATION PORT 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/01/15 09/25/15 Coupon FNA 2014-M5 FA 1MOFRN CMBS 01/25/17 0.56 3136AJ2A3 77.59 77.59

09/01/15 09/25/15 Coupon FNA 2014-M8 FA 1MOFRN CMBS 05/25/18 0.46 3136AKQJ5 320.84 320.84

09/01/15 09/25/15 Coupon FNA 2015-M4 FA 1MOFRN CMBS 09/25/18 0.41 3136AMTM 375.51 375.51

09/01/15 09/25/15 Coupon FNA 2015-M4 FA 1MOFRN CMBS 09/25/18 0.41 3136AMTM 130.47 130.47

09/26/15 09/26/15 Coupon BANK OF AMERICA 03/26/18 1.65 06050TLY6 4,125.00 4,125.00

09/29/15 09/29/15 Coupon FFCB 1ML FRN 08/29/17 0.23 3133EDTT9 326.53 326.53

09/30/15 09/30/15 Coupon U.S. TREASURY NOTE 03/31/16 0.38 912828C40 187.50 187.50

09/30/15 09/30/15 Coupon U.S. TREASURY NOTE 03/31/16 0.38 912828C40 937.50 937.50

09/30/15 09/30/15 Coupon U.S. TREASURY NOTE 03/31/16 0.38 912828C40 1,875.00 1,875.00 41,936.99 41,936.99

09/01/15 09/01/15 Income 5.480 STIF INT USD 5.48 5.48

09/16/15 09/21/15 Sell Long 3,000,000.000 U.S. TREASURY NOTE 04/15/16 0.25 912828UW 2,997,646.20 3,258.20 3,000,904.40

09/21/15 09/23/15 Call 750,000.000 BNY MELLON 10/23/15 0.70 06406HCD 750,000.00 2,187.50 752,187.50

09/23/15 09/29/15 Call 860,000.000 FHLMC C 6/29/17 Q 06/29/17 1.00 3134G7AY7 860,000.00 2,150.00 862,150.00 4,610,000.000 4,607,646.20 7,595.70 4,615,241.90

09/15/15 09/15/15 Pay Princpl 82,610.180 HONDA 2014-4 A2 CAR 01/17/17 0.58 43814JAB0 82,610.18 82,610.18

09/15/15 09/15/15 Pay Princpl 62,974.633 TOYOTA 2013-B A3 CAR 07/17/17 0.89 89236VAC4 62,974.63 62,974.63

09/15/15 09/15/15 Pay Princpl 13,224.673 TOYOTA 2013-B A3 CAR 07/17/17 0.89 89236VAC4 13,224.67 13,224.67

09/15/15 09/15/15 Pay Princpl 55,394.045 USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 55,394.05 55,394.05

Payden & Rygel Page 4157

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN-LOW DURATION PORT 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/18/15 09/18/15 Pay Princpl 72,837.986 HONDA 2013-4 A3 CAR 09/18/17 0.69 43814FAC6 72,837.99 72,837.99

09/20/15 09/20/15 Pay Princpl 45,957.967 VOLKSWAGEN 2013-2 A3 CAR 04/20/18 0.70 92867PAC7 45,957.97 45,957.97

09/22/15 09/22/15 Pay Princpl 36,633.717 GEEMT 2014-1 A2 EQP 04/24/17 0.64 36163TAB9 36,633.72 36,633.72

09/25/15 09/25/15 Pay Princpl 50,529.580 BMW 2013-A A3 CAR 11/27/17 0.67 05578XAC2 50,529.58 50,529.58

09/01/15 09/25/15 Pay Princpl 69,016.440 FHMS K502 A1 CMBS 12/25/16 0.73 3137B03V4 69,016.44 69,016.44

09/25/15 09/25/15 Pay Princpl 4,874.660 FHMS KF01 A 1MOFRN CMBS 04/25/19 0.55 3137AUP52 4,874.66 4,874.66

09/01/15 09/25/15 Pay Princpl 18,463.590 FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 18,463.59 18,463.59

09/01/15 09/25/15 Pay Princpl 7,340.960 FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 7,340.96 7,340.96

09/01/15 09/25/15 Pay Princpl 22,049.480 FNA 2014-M4 ASQ2 CMBS 01/25/17 1.27 3136AJB21 22,049.48 22,049.48

09/01/15 09/25/15 Pay Princpl 10,457.652 FNA 2014-M5 FA 1MOFRN CMBS 01/25/17 0.56 3136AJ2A3 10,457.65 10,457.65

09/01/15 09/25/15 Pay Princpl 10,457.652 FNA 2014-M5 FA 1MOFRN CMBS 01/25/17 0.56 3136AJ2A3 10,457.65 10,457.65

09/01/15 09/25/15 Pay Princpl 727.353 FNA 2014-M8 FA 1MOFRN CMBS 05/25/18 0.46 3136AKQJ5 727.35 727.35

09/01/15 09/25/15 Pay Princpl 988.260 FNA 2015-M4 FA 1MOFRN CMBS 09/25/18 0.41 3136AMTM 988.26 988.26

09/01/15 09/25/15 Pay Princpl 343.380 FNA 2015-M4 FA 1MOFRN CMBS 09/25/18 0.41 3136AMTM 343.38 343.38 564,882.208 564,882.21 564,882.21

09/08/15 09/08/15 Mature Long 750,000.000 SUMITOMO MITSUI BANK YCD 09/08/15 0.27 86563RSE9 750,000.00 750,000.00

09/09/15 09/09/15 Mature Long 750,000.000 LLOYDS BANK YCD 09/09/15 0.30 53945GCK5 750,000.00 750,000.00

09/10/15 09/10/15 Mature Long 750,000.000 BNP PARIBAS YCD 09/10/15 0.28 05574RWT 750,000.00 750,000.00

Payden & Rygel Page 5158

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN-LOW DURATION PORT 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

Fixed Income - cont.09/10/15 09/10/15 Mature Long 750,000.000 MITSUBISHI UFJ YCD 09/10/15 0.27 60682AXB7 750,000.00 750,000.00

3,000,000.000 3,000,000.00 3,000,000.00

Payden & Rygel Page 6159

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/01/15 09/01/15 Buy 50,000,000.000 FHLB DISCOUNT NOTE 09/18/15 313384LW (49,998,701.39) (49,998,701.39)

09/01/15 09/01/15 Buy 20,000,000.000 FHLB DISCOUNT NOTE 09/18/15 313384LW (19,999,480.56) (19,999,480.56)

09/01/15 09/01/15 Buy 35,000,000.000 FHLB DISCOUNT NOTE 09/24/15 313384MC (34,998,658.33) (34,998,658.33)

09/01/15 09/01/15 Buy 50,000,000.000 TVA DISCOUNT NOTE 09/22/15 880592MA (49,998,250.00) (49,998,250.00)

09/01/15 09/01/15 Buy 23,000,000.000 TVA DISCOUNT NOTE 09/22/15 880592MA (22,999,195.00) (22,999,195.00)

09/02/15 09/02/15 Buy 50,000,000.000 U.S. TREASURY BILL 09/10/15 912796GE3 (49,999,833.33) (49,999,833.33)

09/02/15 09/02/15 Buy 45,000,000.000 U.S. TREASURY BILL 09/10/15 912796GE3 (44,999,850.00) (44,999,850.00)

09/02/15 09/02/15 Buy 50,000,000.000 FHLB DISCOUNT NOTE 09/09/15 313384LM9 (49,999,465.28) (49,999,465.28)

09/02/15 09/02/15 Buy 23,000,000.000 FHLB DISCOUNT NOTE 09/09/15 313384LM9 (22,999,754.03) (22,999,754.03)

08/31/15 09/03/15 Buy 1,892,486.060 FNA 2015-M8 FA 1MOFRN CMBS 11/25/18 0.37 3136ANMF (1,891,303.25) (39.16) (1,891,342.41)

09/03/15 09/08/15 Buy 7,500,000.000 SUMITOMO MITSUI YCD 01/07/16 0.37 86563R2Z0 (7,500,000.00) (7,500,000.00)

09/08/15 09/10/15 Buy 7,500,000.000 BNP PARIBAS YCD 12/10/15 0.32 05574RB95 (7,500,000.00) (7,500,000.00)

09/08/15 09/10/15 Buy 7,500,000.000 BANK OF TOKYO-MITSUBISHI Y 11/02/15 0.23 06538J5K8 (7,500,000.00) (7,500,000.00)

09/09/15 09/10/15 Buy 50,000,000.000 FHLB DISCOUNT NOTE 09/30/15 313384MJ5 (49,998,055.56) (49,998,055.56)

09/08/15 09/10/15 Buy 7,500,000.000 LLOYDS BANK YCD 01/21/16 0.38 53945GKR1 (7,500,000.00) (7,500,000.00)

09/09/15 09/10/15 Buy 40,000,000.000 TVA DISCOUNT NOTE 09/29/15 880592MH (39,998,733.33) (39,998,733.33)

09/08/15 09/15/15 Buy 1,500,000.000 HOME DEPOT FRN 09/15/17 0.71 437076BJ0 (1,500,000.00) (1,500,000.00)

09/28/15 09/29/15 Buy 35,000,000.000 FHLB DISCOUNT NOTE 10/09/15 313384MT3 (34,999,902.78) (34,999,902.78)

Payden & Rygel Page 1160

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

Fixed Income - cont.09/10/15 09/30/15 Buy 10,000,000.000 FNA 2015-M12 FA 04/25/20 0.54 3136AP3Z3 (9,996,400.00) (4,350.00) (10,000,750.00)

514,392,486.060 (514,377,582.84) (4,389.16) (514,381,972.00)

09/01/15 09/01/15 Coupon BRANCH BANKING & TRUST FR 12/01/16 0.75 07330NAF2 455.37 455.37

09/01/15 09/01/15 Coupon BRANCH BANKING & TRUST FR 12/01/16 0.75 07330NAF2 2,732.21 2,732.21

09/01/15 09/01/15 Coupon BRANCH BANKING & TRUST FR 12/01/16 0.75 07330NAF2 910.74 910.74

09/01/15 09/01/15 Coupon BRANCH BANKING & TRUST FR 12/01/16 0.75 07330NAF2 1,056.45 1,056.45

09/01/15 09/01/15 Coupon CISCO SYSTEMS FRN 03/01/19 0.82 17275RAQ 800.14 800.14

09/01/15 09/01/15 Coupon CISCO SYSTEMS FRN 03/01/19 0.82 17275RAQ 430.08 430.08

09/01/15 09/01/15 Coupon CISCO SYSTEMS FRN 03/01/19 0.82 17275RAQ 726.13 726.13

09/01/15 09/01/15 Coupon CISCO SYSTEMS FRN 03/01/19 0.82 17275RAQ 2,600.47 2,600.47

09/01/15 09/01/15 Coupon CA GOLDEN EMPIRE SCH FRN 05/01/16 0.22 381008AS0 1,573.15 1,573.15

09/01/15 09/01/15 Coupon COCA-COLA 09/01/16 1.80 191216AU4 48,339.00 48,339.00

09/01/15 09/01/15 Coupon COCA-COLA 09/01/16 1.80 191216AU4 4,383.00 4,383.00

09/01/15 09/01/15 Coupon ELI LILLY & CO 03/01/18 1.25 532457BK3 4,888.89 4,888.89

09/01/15 09/01/15 Coupon PNC BANK FRN 06/01/18 0.74 69353REN4 7,183.67 7,183.67

09/02/15 09/02/15 Coupon CHEVRON FRN 03/02/18 0.50 166764AW 2,898.96 2,898.96

09/02/15 09/02/15 Coupon CHEVRON FRN 03/02/18 0.50 166764AW 1,449.48 1,449.48

09/02/15 09/02/15 Coupon CHEVRON 03/02/18 1.37 166764AV2 8,144.50 8,144.50

09/02/15 09/02/15 Coupon FFCB 1ML FRN 01/02/18 0.24 3133EEWS 2,075.54 2,075.54

Payden & Rygel Page 2161

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/02/15 09/02/15 Coupon FFCB 3ML FRN 03/02/18 0.30 3133EEDP2 1,296.94 1,296.94

09/03/15 09/03/15 Coupon CATERPILLAR FINANCIAL FRN 03/03/17 0.56 14912L5Y3 3,929.17 3,929.17

09/03/15 09/03/15 Coupon CATERPILLAR FINANCIAL FRN 03/03/17 0.56 14912L5Y3 654.86 654.86

09/03/15 09/03/15 Coupon CATERPILLAR FINANCIAL FRN 03/03/17 0.56 14912L5Y3 2,619.44 2,619.44

09/03/15 09/03/15 Coupon CATERPILLAR FINANCIAL FRN 03/03/17 0.56 14912L5Y3 374.58 374.58

09/03/15 09/03/15 Coupon CISCO SYSTEMS 03/03/17 1.10 17275RAT9 2,915.00 2,915.00

09/03/15 09/03/15 Coupon CISCO SYSTEMS 03/03/17 1.10 17275RAT9 5,527.50 5,527.50

09/03/15 09/03/15 Coupon FFCB 1ML FRN 10/03/16 0.22 3133ED3B6 897.71 897.71

09/04/15 09/04/15 Coupon JOHN DEERE CAPITAL 09/04/15 0.70 24422ERV3 980.00 980.00

09/04/15 09/04/15 Coupon FFCB 1ML FRN 08/04/17 0.24 3133EDUD 1,995.63 1,995.63

09/04/15 09/04/15 Coupon NGN 2010-R2 1A 1MOFRN NCUA 11/06/17 0.57 62888UAA8 1,088.42 1,088.42

09/04/15 09/04/15 Coupon NGN 2010-R2 1A 1MOFRN NCUA 11/06/17 0.57 62888UAA8 1,131.02 1,131.02

09/04/15 09/04/15 Coupon NGN 2011-R1 1A 1MOFRN NCUA 01/08/20 0.65 62888YAA0 5,606.49 5,606.49

09/04/15 09/04/15 Coupon NGN 2011-R1 1A 1MOFRN NCUA 01/08/20 0.65 62888YAA0 955.53 955.53

09/04/15 09/04/15 Coupon NGN 2011-R2 1A 1MOFRN NCUA 02/06/20 0.60 62889CAA7 648.27 648.27

09/04/15 09/04/15 Coupon NGN 2011-R4 1A 1MOFRN NCUA 03/06/20 0.58 62889FAA0 4,621.65 4,621.65

09/04/15 09/04/15 Coupon NGN 2011-R4 1A 1MOFRN NCUA 03/06/20 0.58 62889FAA0 551.51 551.51

09/06/15 09/06/15 Coupon EXXON MOBIL 03/06/18 1.31 30231GAL6 30,210.75 30,210.75

09/08/15 09/08/15 Coupon AMERICAN EXPRESS FRN 06/05/17 0.60 0258M0DN 3,840.59 3,840.59

09/08/15 09/08/15 Coupon BNY MELLON FRN 03/06/18 0.77 06406HCK3 459.30 459.30

Payden & Rygel Page 3162

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/08/15 09/08/15 Coupon BNY MELLON FRN 03/06/18 0.77 06406HCK3 918.59 918.59

09/08/15 09/08/15 Coupon MANUFACTURERS & TRADERS F 03/07/16 0.63 55279HAB6 3,173.34 3,173.34

09/08/15 09/08/15 Coupon MANUFACTURERS & TRADERS F 03/07/16 0.63 55279HAB6 2,219.12 2,219.12

09/08/15 09/08/15 Coupon PACCAR FINANCIAL FRN 06/06/17 0.52 69371RL95 179.75 179.75

09/08/15 09/08/15 Coupon PACCAR FINANCIAL FRN 06/06/17 0.52 69371RL95 3,415.16 3,415.16

09/08/15 09/08/15 Coupon PACCAR FINANCIAL FRN 06/06/17 0.52 69371RL95 275.61 275.61

09/08/15 09/08/15 Coupon PACCAR FINANCIAL FRN 06/06/17 0.52 69371RL95 3,774.65 3,774.65

09/08/15 09/08/15 Coupon STATE STREET BANK FRN 12/08/15 0.53 85744NAB7 305.96 305.96

09/08/15 09/08/15 Coupon STATE STREET BANK FRN 12/08/15 0.53 85744NAB7 1,529.82 1,529.82

09/08/15 09/08/15 Coupon STATE STREET BANK FRN 12/08/15 0.53 85744NAB7 1,462.51 1,462.51

09/08/15 09/08/15 Coupon STATE STREET BANK FRN 12/08/15 0.53 85744NAB7 5,397.20 5,397.20

09/08/15 09/08/15 Coupon SUMITOMO MITSUI BANK YCD 09/08/15 0.27 86563RSE9 6,581.25 6,581.25

09/09/15 09/09/15 Coupon LLOYDS BANK YCD 09/09/15 0.30 53945GCK5 7,500.00 7,500.00

09/09/15 09/09/15 Coupon PACCAR FINANCIAL 03/09/18 1.45 69371RM4 7,032.50 7,032.50

09/10/15 09/10/15 Coupon BNP PARIBAS YCD 09/10/15 0.28 05574RWT 6,883.33 6,883.33

09/10/15 09/10/15 Coupon MITSUBISHI UFJ YCD 09/10/15 0.27 60682AXB7 6,637.50 6,637.50

09/10/15 09/10/15 Coupon NGN 2011-R3 1A 1MO FRN NCU 03/11/20 0.60 62889EAA3 2,976.36 2,976.36

09/10/15 09/10/15 Coupon NGN 2011-R3 1A 1MO FRN NCU 03/11/20 0.60 62889EAA3 337.32 337.32

09/10/15 09/10/15 Coupon NGN 2011-R3 1A 1MO FRN NCU 03/11/20 0.60 62889EAA3 385.82 385.82

09/10/15 09/10/15 Coupon CHARLES SCHWAB 03/10/18 1.50 808513AK1 9,000.00 9,000.00

Payden & Rygel Page 4163

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/11/15 09/11/15 Coupon US BANK OHIO FRN 09/11/17 0.53 90331HMJ9 930.54 930.54

09/11/15 09/11/15 Coupon US BANK OHIO FRN 09/11/17 0.53 90331HMJ9 3,722.17 3,722.17

09/12/15 09/12/15 Coupon TEXAS INSTRUMENTS 03/12/17 0.88 882508AX2 2,187.50 2,187.50

09/13/15 09/13/15 Coupon FFCB 1ML FRN 02/13/17 0.25 3133EDFB3 1,005.13 1,005.13

09/14/15 09/14/15 Coupon FFCB 3ML FRN 09/12/17 0.27 3133EETJ9 5,688.31 5,688.31

09/14/15 09/14/15 Coupon JPMORGAN CHASE FRN 06/13/16 0.67 48121CJM9 1,556.73 1,556.73

09/14/15 09/14/15 Coupon JPMORGAN CHASE FRN 06/13/16 0.67 48121CJM9 2,257.26 2,257.26

09/14/15 09/14/15 Coupon JPMORGAN CHASE FRN 06/13/16 0.67 48121CJM9 2,023.75 2,023.75

09/15/15 09/15/15 Coupon BB&T CORPORATION FRN 06/15/18 1.20 05531FAP8 4,392.43 4,392.43

09/15/15 09/15/15 Coupon BB&T CORPORATION FRN 06/15/18 1.20 05531FAP8 878.49 878.49

09/15/15 09/15/15 Coupon CHASE 2014-A1 A1 CDT 01/15/19 1.15 161571GJ7 3,354.17 3,354.17

09/15/15 09/15/15 Coupon CHASE 2014-A1 A1 CDT 01/15/19 1.15 161571GJ7 1,916.67 1,916.67

09/15/15 09/15/15 Coupon CHASE 2014-A1 A1 CDT 01/15/19 1.15 161571GJ7 2,875.00 2,875.00

09/15/15 09/15/15 Coupon CHASE 2015-A3 A CDT 1MOFRN 04/15/19 0.46 161571GW 2,596.08 2,596.08

09/15/15 09/15/15 Coupon CISCO SYSTEMS FRN 06/15/18 0.65 17275RAY8 11,271.75 11,271.75

09/15/15 09/15/15 Coupon DRYROCK 2014-2 A 1MOFRN CD 03/16/20 0.55 06742LAC7 4,330.67 4,330.67

09/15/15 09/15/15 Coupon DRYROCK 2014-2 A 1MOFRN CD 03/16/20 0.55 06742LAC7 2,165.33 2,165.33

09/15/15 09/15/15 Coupon HONDA 2014-4 A2 CAR 01/17/17 0.58 43814JAB0 570.65 570.65

09/15/15 09/15/15 Coupon HONDA 2015-1 A2 CAR 06/15/17 0.70 43814KAB7 991.67 991.67

09/15/15 09/15/15 Coupon HONDA 2015-1 A2 CAR 06/15/17 0.70 43814KAB7 1,633.33 1,633.33

Payden & Rygel Page 5164

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/15/15 09/15/15 Coupon JOHN DEERE 2013-B A3 EQP 08/15/17 0.87 477879AC4 1,511.90 1,511.90

09/15/15 09/15/15 Coupon JOHN DEERE 2014-A A3 EQP 04/16/18 0.92 47787VAC5 2,319.17 2,319.17

09/15/15 09/15/15 Coupon JOHN DEERE 2015-A A2A EQP 02/15/18 0.87 47787UAB9 3,559.75 3,559.75

09/15/15 09/15/15 Coupon JOHN DEERE 2015-A A2A EQP 02/15/18 0.87 47787UAB9 94.25 94.25

09/15/15 09/15/15 Coupon JOHN DEERE 2015-A A2A EQP 02/15/18 0.87 47787UAB9 616.25 616.25

09/15/15 09/15/15 Coupon GEORGIA POWER FRN 03/15/16 0.66 373334KB6 402.55 402.55

09/15/15 09/15/15 Coupon GEORGIA POWER FRN 03/15/16 0.66 373334KB6 1,145.73 1,145.73

09/15/15 09/15/15 Coupon TOYOTA 2014-B A3 CAR 03/15/18 0.76 89231RAC8 2,546.00 2,546.00

09/15/15 09/15/15 Coupon TOYOTA 2015-A A2 CAR 07/17/17 0.71 89236WAB 1,704.00 1,704.00

09/15/15 09/15/15 Coupon TOYOTA 2015-A A2 CAR 07/17/17 0.71 89236WAB 769.17 769.17

09/15/15 09/15/15 Coupon TOYOTA 2015-B A2A GREEN CA 11/15/17 0.77 89237CAB7 3,606.17 3,606.17

09/15/15 09/15/15 Coupon TOYOTA 2015-C A2A CAR 02/15/18 0.93 89231TAB6 3,681.25 3,681.25

09/15/15 09/15/15 Coupon USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 494.61 494.61

09/15/15 09/15/15 Coupon USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 1,782.47 1,782.47

09/15/15 09/15/15 Coupon USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 2,258.41 2,258.41

09/15/15 09/15/15 Coupon WACHOVIA FRN 06/15/17 0.61 929903DU3 3,551.26 3,551.26

09/15/15 09/15/15 Coupon WACHOVIA FRN 06/15/17 0.61 929903DU3 2,130.76 2,130.76

09/16/15 09/16/15 Coupon FFCB 1ML FRN 04/16/18 0.26 3133EEZC7 1,476.49 1,476.49

09/17/15 09/17/15 Coupon FFCB 1ML FRN 01/17/18 0.24 3133EEZM5 1,959.89 1,959.89

09/17/15 09/17/15 Coupon FFCB 1ML FRN 04/17/17 0.26 3133EDJX1 639.63 639.63

Payden & Rygel Page 6165

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/20/15 09/20/15 Coupon VOLKSWAGEN 2013-2 A3 CAR 04/20/18 0.70 92867PAC7 6,399.38 6,399.38

09/20/15 09/20/15 Coupon VOLKSWAGEN 2013-2 A3 CAR 04/20/18 0.70 92867PAC7 1,066.56 1,066.56

09/21/15 09/21/15 Coupon GEDFT 2013-1 A 1MOFRN FLOO 04/20/18 0.62 36159LCF1 522.38 522.38

09/21/15 09/21/15 Coupon GEDFT 2013-1 A 1MOFRN FLOO 04/20/18 0.62 36159LCF1 262.53 262.53

09/21/15 09/21/15 Coupon GEDFT 2013-1 A 1MOFRN FLOO 04/20/18 0.62 36159LCF1 642.93 642.93

09/21/15 09/21/15 Coupon GEDFT 2013-1 A 1MOFRN FLOO 04/20/18 0.62 36159LCF1 2,001.13 2,001.13

09/21/15 09/21/15 Coupon GEDFT 2013-1 A 1MOFRN FLOO 04/20/18 0.62 36159LCF1 238.42 238.42

09/21/15 09/21/15 Coupon GEDFT 2013-1 A 1MOFRN FLOO 04/20/18 0.62 36159LCF1 878.68 878.68

09/21/15 09/21/15 Coupon GEDFT 2013-1 A 1MOFRN FLOO 04/20/18 0.62 36159LCF1 107.16 107.16

09/21/15 09/21/15 Coupon GEDFT 2014-2 A 1MOFRN FLOO 10/20/19 0.67 36159LCN4 2,218.36 2,218.36

09/21/15 09/21/15 Coupon HONDA 2015-2 A3 CAR 02/21/19 1.04 43813NAC0 4,285.67 4,285.67

09/22/15 09/22/15 Coupon AMERICAN EXPRESS FRN 09/22/17 0.62 0258M0DS 801.50 801.50

09/22/15 09/22/15 Coupon AMERICAN EXPRESS FRN 09/22/17 0.62 0258M0DS 2,909.16 2,909.16

09/22/15 09/22/15 Coupon AMERICAN EXPRESS FRN 09/22/17 0.62 0258M0DS 2,226.40 2,226.40

09/22/15 09/22/15 Coupon BB&T CORPORATION 03/22/17 2.15 05531FAK9 24,187.50 24,187.50

09/22/15 09/22/15 Coupon GEEMT 2014-1 A2 EQP 04/24/17 0.64 36163TAB9 346.48 346.48

09/22/15 09/22/15 Coupon GEEMT 2014-1 A2 EQP 04/24/17 0.64 36163TAB9 1,039.44 1,039.44

09/23/15 09/23/15 Coupon GEET 2015-1 A2 EQP 11/24/17 0.89 36164EAB1 967.88 967.88

09/25/15 09/25/15 Coupon BMW 2014-A A3 CAR 11/26/18 0.97 09658UAC3 1,705.58 1,705.58

09/01/15 09/25/15 Coupon FHMS K708 A2 CMBS 01/25/19 2.13 3137AQT24 2,378.50 2,378.50

Payden & Rygel Page 7166

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/01/15 09/25/15 Coupon FHMS K708 A2 CMBS 01/25/19 2.13 3137AQT24 1,775.00 1,775.00

09/01/15 09/25/15 Coupon FHMS K710 A2 CMBS 05/25/19 1.88 3137ARPY6 2,997.11 2,997.11

09/25/15 09/25/15 Coupon FHMS KF01 A 1MOFRN CMBS 04/25/19 0.55 3137AUP52 78.06 78.06

09/01/15 09/25/15 Coupon FNA 2012-M9 ASQ2 CMBS 12/25/17 1.51 3136A7L26 2,611.19 2,611.19

09/01/15 09/25/15 Coupon FNA 2013-M1 ASQ2 CMBS 11/25/16 1.07 3136ABPT4 1,050.36 1,050.36

09/01/15 09/25/15 Coupon FNA 2013-M7 ASQ2 CMBS 03/26/18 1.23 3136AEGM 1,904.45 1,904.45

09/01/15 09/25/15 Coupon FNA 14-M1 ASQ2 CMBS 11/25/18 2.32 3136AHUV 3,871.67 3,871.67

09/01/15 09/25/15 Coupon FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 13.29 13.29

09/01/15 09/25/15 Coupon FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 5.32 5.32

09/01/15 09/25/15 Coupon FNA 2014-M3 ASQ2 CMBS 03/25/16 0.56 3136AJKZ8 1,618.35 1,618.35

09/01/15 09/25/15 Coupon FNA 2014-M3 ASQ2 CMBS 03/25/16 0.56 3136AJKZ8 1,573.50 1,573.50

09/01/15 09/25/15 Coupon FNA 2014-M5 FA 1MOFRN CMBS 01/25/17 0.56 3136AJ2A3 155.19 155.19

09/01/15 09/25/15 Coupon FNA 2014-M8 FA 1MOFRN CMBS 05/25/18 0.46 3136AKQJ5 577.51 577.51

09/01/15 09/25/15 Coupon FNA 2014-M6 FA 1MOFRN CMBS 12/25/17 0.50 3136AJ7D2 451.81 451.81

09/01/15 09/25/15 Coupon FNA 2015-M3 FA 1MOFRN CMBS 06/25/18 0.42 3136AMMC 478.13 478.13

09/01/15 09/25/15 Coupon FNA 2015-M4 FA 1MOFRN CMBS 09/25/18 0.41 3136AMTM 4,455.15 4,455.15

09/01/15 09/25/15 Coupon FNA 2015-M7 ASQ2 CMBS 04/25/18 1.55 3136ANJY4 4,843.75 4,843.75

09/01/15 09/25/15 Coupon FNA 2015-M8 FA 1MOFRN CMBS 11/25/18 0.37 3136ANMF 4,044.35 4,044.35

09/01/15 09/25/15 Coupon FNA 2015-M8 FA 1MOFRN CMBS 11/25/18 0.37 3136ANMF 543.27 543.27

09/26/15 09/26/15 Coupon BANK OF AMERICA 03/26/18 1.65 06050TLY6 21,862.50 21,862.50

Payden & Rygel Page 8167

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/30/15 09/30/15 Coupon U.S. TREASURY NOTE 03/31/16 0.38 912828C40 93,750.00 93,750.00

09/30/15 09/30/15 Coupon U.S. TREASURY NOTE 03/31/16 0.38 912828C40 93,750.00 93,750.00 621,130.87 621,130.87

09/01/15 09/01/15 Income 2,581.380 ADJ NET P&I USD 2,581.38 2,581.38

09/01/15 09/01/15 Income 120.540 STIF INT USD 120.54 120.54 2,701.920 2,701.92 2,701.92

09/01/15 09/01/15 Contributn 180,000,000.000 NM USD 180,000,000.00 180,000,000.00

09/02/15 09/02/15 Contributn 170,000,000.000 NM USD 170,000,000.00 170,000,000.00 350,000,000.000 350,000,000.00 350,000,000.00

09/11/15 09/14/15 Sell Long 15,000,000.000 FHLB DISCOUNT NOTE 09/18/15 313384LW 14,999,602.09 297.91 14,999,900.00

09/14/15 09/15/15 Sell Long 10,000,000.000 FHLB DISCOUNT NOTE 09/18/15 313384LW 9,999,744.44 213.89 9,999,958.33

09/15/15 09/16/15 Sell Long 25,000,000.000 FHLB DISCOUNT NOTE 09/18/15 313384LW 24,999,322.92 572.91 24,999,895.83

09/15/15 09/16/15 Sell Long 20,000,000.000 FHLB DISCOUNT NOTE 09/18/15 313384LW 19,999,458.34 458.33 19,999,916.67

09/15/15 09/16/15 Sell Long 47,000,000.000 TVA DISCOUNT NOTE 09/22/15 880592MA 46,997,963.33 1,175.00 46,999,138.33

09/21/15 09/23/15 Call 500,000.000 BNY MELLON 10/23/15 0.70 06406HCD 500,000.00 1,458.33 501,458.33

09/21/15 09/23/15 Call 2,000,000.000 BNY MELLON 10/23/15 0.70 06406HCD 2,000,000.00 5,833.33 2,005,833.33

09/21/15 09/23/15 Call 1,300,000.000 BNY MELLON 10/23/15 0.70 06406HCD 1,300,000.00 3,791.67 1,303,791.67

Payden & Rygel Page 9168

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

Fixed Income - cont.09/23/15 09/29/15 Call 15,000,000.000 FHLMC C 6/29/17 Q 06/29/17 1.00 3134G7AY7 15,000,000.00 37,500.00 15,037,500.00

135,800,000.000 135,796,091.11 51,301.38 135,847,392.49

09/04/15 09/04/15 Pay Princpl 52,002.205 NGN 2010-R2 1A 1MOFRN NCUA 11/06/17 0.57 62888UAA8 52,002.20 52,002.20

09/04/15 09/04/15 Pay Princpl 54,037.379 NGN 2010-R2 1A 1MOFRN NCUA 11/06/17 0.57 62888UAA8 54,037.38 54,037.38

09/04/15 09/04/15 Pay Princpl 199,709.303 NGN 2011-R1 1A 1MOFRN NCUA 01/08/20 0.65 62888YAA0 199,709.30 199,709.30

09/04/15 09/04/15 Pay Princpl 34,036.994 NGN 2011-R1 1A 1MOFRN NCUA 01/08/20 0.65 62888YAA0 34,036.99 34,036.99

09/04/15 09/04/15 Pay Princpl 22,242.289 NGN 2011-R2 1A 1MOFRN NCUA 02/06/20 0.60 62889CAA7 22,242.29 22,242.29

09/04/15 09/04/15 Pay Princpl 432,149.858 NGN 2011-R4 1A 1MOFRN NCUA 03/06/20 0.58 62889FAA0 432,149.86 432,149.86

09/04/15 09/04/15 Pay Princpl 51,569.196 NGN 2011-R4 1A 1MOFRN NCUA 03/06/20 0.58 62889FAA0 51,569.20 51,569.20

09/10/15 09/10/15 Pay Princpl 105,632.195 NGN 2011-R3 1A 1MO FRN NCU 03/11/20 0.60 62889EAA3 105,632.19 105,632.19

09/10/15 09/10/15 Pay Princpl 11,971.649 NGN 2011-R3 1A 1MO FRN NCU 03/11/20 0.60 62889EAA3 11,971.65 11,971.65

09/10/15 09/10/15 Pay Princpl 13,693.062 NGN 2011-R3 1A 1MO FRN NCU 03/11/20 0.60 62889EAA3 13,693.06 13,693.06

09/15/15 09/15/15 Pay Princpl 155,761.180 HONDA 2014-4 A2 CAR 01/17/17 0.58 43814JAB0 155,761.18 155,761.18

09/15/15 09/15/15 Pay Princpl 130,687.374 JOHN DEERE 2013-B A3 EQP 08/15/17 0.87 477879AC4 130,687.37 130,687.37

09/15/15 09/15/15 Pay Princpl 103,925.112 USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 103,925.11 103,925.11

09/15/15 09/15/15 Pay Princpl 374,522.573 USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 374,522.57 374,522.57

09/15/15 09/15/15 Pay Princpl 474,525.982 USAA 2014-1 A3 CAR 12/15/17 0.58 90290KAC9 474,525.98 474,525.98

09/20/15 09/20/15 Pay Princpl 689,369.502 VOLKSWAGEN 2013-2 A3 CAR 04/20/18 0.70 92867PAC7 689,369.50 689,369.50

09/20/15 09/20/15 Pay Princpl 114,894.917 VOLKSWAGEN 2013-2 A3 CAR 04/20/18 0.70 92867PAC7 114,894.92 114,894.92

Payden & Rygel Page 10169

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/22/15 09/22/15 Pay Princpl 65,940.690 GEEMT 2014-1 A2 EQP 04/24/17 0.64 36163TAB9 65,940.69 65,940.69

09/22/15 09/22/15 Pay Princpl 197,822.071 GEEMT 2014-1 A2 EQP 04/24/17 0.64 36163TAB9 197,822.07 197,822.07

09/25/15 09/25/15 Pay Princpl 21,935.970 FHMS KF01 A 1MOFRN CMBS 04/25/19 0.55 3137AUP52 21,935.97 21,935.97

09/01/15 09/25/15 Pay Princpl 2,247.762 FNA 2012-M9 ASQ2 CMBS 12/25/17 1.51 3136A7L26 2,247.76 2,247.76

09/01/15 09/25/15 Pay Princpl 21,010.960 FNA 2013-M1 ASQ2 CMBS 11/25/16 1.07 3136ABPT4 21,010.96 21,010.96

09/01/15 09/25/15 Pay Princpl 1,539.626 FNA 2013-M7 ASQ2 CMBS 03/26/18 1.23 3136AEGM 1,539.63 1,539.63

09/01/15 09/25/15 Pay Princpl 33,367.920 FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 33,367.92 33,367.92

09/01/15 09/25/15 Pay Princpl 13,347.150 FNA 2014-M2 ASQ2 CMBS 09/25/15 0.48 3136AJDN3 13,347.15 13,347.15

09/01/15 09/25/15 Pay Princpl 984,138.220 FNA 2014-M3 ASQ2 CMBS 03/25/16 0.56 3136AJKZ8 984,138.22 984,138.22

09/01/15 09/25/15 Pay Princpl 956,867.500 FNA 2014-M3 ASQ2 CMBS 03/25/16 0.56 3136AJKZ8 956,867.50 956,867.50

09/01/15 09/25/15 Pay Princpl 20,915.304 FNA 2014-M5 FA 1MOFRN CMBS 01/25/17 0.56 3136AJ2A3 20,915.30 20,915.30

09/01/15 09/25/15 Pay Princpl 1,309.235 FNA 2014-M8 FA 1MOFRN CMBS 05/25/18 0.46 3136AKQJ5 1,309.24 1,309.24

09/01/15 09/25/15 Pay Princpl 43,470.970 FNA 2014-M6 FA 1MOFRN CMBS 12/25/17 0.50 3136AJ7D2 43,470.97 43,470.97

09/01/15 09/25/15 Pay Princpl 1,436.400 FNA 2015-M3 FA 1MOFRN CMBS 06/25/18 0.42 3136AMMC 1,436.40 1,436.40

09/01/15 09/25/15 Pay Princpl 11,725.140 FNA 2015-M4 FA 1MOFRN CMBS 09/25/18 0.41 3136AMTM 11,725.14 11,725.14

09/01/15 09/25/15 Pay Princpl 225,379.690 FNA 2015-M8 FA 1MOFRN CMBS 11/25/18 0.37 3136ANMF 225,379.69 225,379.69

09/01/15 09/25/15 Pay Princpl 30,274.880 FNA 2015-M8 FA 1MOFRN CMBS 11/25/18 0.37 3136ANMF 30,274.88 30,274.88 5,653,460.258 5,653,460.24 5,653,460.24

Payden & Rygel Page 11170

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/04/15 09/04/15 Mature Long 280,000.000 JOHN DEERE CAPITAL 09/04/15 0.70 24422ERV3 280,000.00 280,000.00

09/08/15 09/08/15 Mature Long 7,500,000.000 SUMITOMO MITSUI BANK YCD 09/08/15 0.27 86563RSE9 7,500,000.00 7,500,000.00

09/09/15 09/09/15 Mature Long 50,000,000.000 FHLB DISCOUNT NOTE 09/09/15 313384LM9 49,999,465.28 534.72 50,000,000.00

09/09/15 09/09/15 Mature Long 23,000,000.000 FHLB DISCOUNT NOTE 09/09/15 313384LM9 22,999,754.03 245.97 23,000,000.00

09/09/15 09/09/15 Mature Long 7,500,000.000 LLOYDS BANK YCD 09/09/15 0.30 53945GCK5 7,500,000.00 7,500,000.00

09/10/15 09/10/15 Mature Long 50,000,000.000 U.S. TREASURY BILL 09/10/15 912796GE3 49,999,833.33 166.67 50,000,000.00

09/10/15 09/10/15 Mature Long 45,000,000.000 U.S. TREASURY BILL 09/10/15 912796GE3 44,999,850.00 150.00 45,000,000.00

09/10/15 09/10/15 Mature Long 7,500,000.000 BNP PARIBAS YCD 09/10/15 0.28 05574RWT 7,500,000.00 7,500,000.00

09/10/15 09/10/15 Mature Long 7,500,000.000 MITSUBISHI UFJ YCD 09/10/15 0.27 60682AXB7 7,500,000.00 7,500,000.00

09/14/15 09/14/15 Mature Long 50,000,000.000 FNMA DISCOUNT NOTE 09/14/15 313588LS2 49,969,847.22 30,152.78 50,000,000.00

09/14/15 09/14/15 Mature Long 50,000,000.000 FNMA DISCOUNT NOTE 09/14/15 313588LS2 49,969,847.22 30,152.78 50,000,000.00

09/22/15 09/22/15 Mature Long 3,000,000.000 TVA DISCOUNT NOTE 09/22/15 880592MA 2,999,895.00 105.00 3,000,000.00

09/22/15 09/22/15 Mature Long 23,000,000.000 TVA DISCOUNT NOTE 09/22/15 880592MA 22,999,195.00 805.00 23,000,000.00

09/24/15 09/24/15 Mature Long 35,000,000.000 FHLB DISCOUNT NOTE 09/24/15 313384MC 34,998,658.33 1,341.67 35,000,000.00

09/29/15 09/29/15 Mature Long 40,000,000.000 TVA DISCOUNT NOTE 09/29/15 880592MH 39,998,733.33 1,266.67 40,000,000.00

09/30/15 09/30/15 Mature Long 50,000,000.000 FHLB DISCOUNT NOTE 09/30/15 313384MJ5 49,998,055.56 1,944.44 50,000,000.00 449,280,000.000 449,213,134.30 66,865.71 449,280,000.00

09/09/15 09/09/15 Withdrawal (75,000,000.000) WD USD (75,000,000.00) (75,000,000.00)

09/14/15 09/14/15 Withdrawal (120,000,000.000) WD USD (120,000,000.00) (120,000,000.00)

Payden & Rygel Page 12171

TRANSACTIONS BY TYPE

Account Name: L.A. CARE HEALTH PLAN 09/01/2015Account Number: through 09/30/2015

Trade Settlement Transaction Maturity Coupon Accrued Interest TotalDate Date Type Units Description Date Rate CUSIP Proceeds / (Cost) (Purch) or Sold Amount

09/16/15 09/16/15 Withdrawal (100,000,000.000) WD USD (100,000,000.00) (100,000,000.00)

09/24/15 09/24/15 Withdrawal (50,000,000.000) WD USD (50,000,000.00) (50,000,000.00)

09/30/15 09/30/15 Withdrawal (75,000,000.000) WD USD (75,000,000.00) (75,000,000.00) 420,000,000.000) (420,000,000.00) (420,000,000.00)

Payden & Rygel Page 13172

APPROVED

BOARD OF GOVERNORSFinance & Budget CommitteeMeeting Minutes – September 23, 20151055 W. 7th Street, Los Angeles, CA 90017

Members Management/Staff Guest/PublicMichael Rembis, Chairperson John Baackes, Chief Executive Officer Laurie Garcia, Anthem Blue CrossMark Gamble Gertrude S. Carter, MD, Chief Medical Officer Alan Bloom, Care 1stJann Hamilton Lee Jonathan Freedman, Chief of Strategy, Regulatory and External Affairs Avanti Wadu, iHealth, Inc.Ozzie Lopez ** and Interim Chief Operating Officer* Pablo Gabella, Bristol-Myers SquibbLouise McCarthy Augustavia Haydel, General CounselHilda Perez Tim Reilly, Interim Chief Financial Officer

Tom Schwaninger, Chief Information Officer**Absent ** Via Teleconference

AGENDAITEM/PRESENTER

MOTIONS / MAJOR DISCUSSIONS ACTION TAKENCALL TO ORDER

Michael Rembis

Michael Rembis, Committee Chairperson, called the meeting to order at 1:07 p.m.

He announced that members of the public may address the Committee on each matterlisted on the agenda before or during the Committee’s consideration of the item, or onany other topic at the Public Comment section.

APPROVE MEETINGAGENDA

Michael Rembis

The Agenda for today’s meeting was approved. Approved unanimouslyby roll call. 6 AYES(Gamble, Hamilton Lee,Lopez, McCarthy, Perezand Rembis)

PUBLIC COMMENTS There were no public comments.

APPROVE MEETINGMINUTES

Michael Rembis

The minutes of the August 26, 2015 meeting were approved as presented. Approved unanimouslyby roll call. 6 AYES

173

Finance and Budget CommitteeSeptember 23, 2015Page 2 of 4 APPROVED

AGENDAITEM/PRESENTER

MOTIONS / MAJOR DISCUSSIONS ACTION TAKENADJOURN TO CLOSEDSESSION

Augustavia J. Haydel, Esq., General Counsel, announced the items that the Committee will discuss in closed session.There was no public comment on the Closed Session items and the meeting adjourned to closed session at 1:10 p.m.

CONTRACT RATESPursuant to Welfare and Institutions Code Section 14087.38(m)

Plan Partner Rates

Provider Rates

DHCS Rates

RECONVENE IN OPENSESSION

The meeting reconvened in open session at 1:15 p.m. No reportable actions weretaken during the closed session.

CHAIRPERSON’SREPORT

There was no report from the Chairperson.

CHIEF EXECUTIVEOFFICER REPORT

John Baackes, Chief Executive Officer, reported:

Discussions have been held with staff regarding the organizational restructuring toimplement and align L.A. Care operations with the strategic vision the Boardapproved at the September meeting. Recruitment has begun for the product lineExecutive Directors, and recruitment continues for COO and CFO.Implementation of the organizational restructuring will be finalized in January 2016.

Participating Provider Groups (PPGs) joined L.A. Care staff last month to discusstheir accountability for meeting quality standards and how they can participate inimproving L.A. Care’s quality ratings.

COMMITTEE ITEMS

FINANCIAL OFFICERREPORT

Tim Reilly

Tim Reilly, Interim Chief Financial Officer, reviewed the Medi-Cal Expansion rate cut andhas sent reduced rates to providers to avoid a future reconciliation.

Monthly InvestmentTransactions Report

Mr. Reilly referred to the report on investment transactions included in the meetingmaterials for Committee review. (A copy of the report can be obtained by contacting BoardServices).

174

Finance and Budget CommitteeSeptember 23, 2015Page 3 of 4 APPROVED

AGENDAITEM/PRESENTER

MOTIONS / MAJOR DISCUSSIONS ACTION TAKENJuly 2015 Financial Report Mr. Reilly provided a summary of L.A. Care’s financial performance:

Reviewed the revenue and performance by product line.

All key financial indicators are within budget and on par with prior months’performance.

Revenue is slightly behind budget while administrative and healthcare expenses aretracking under budget.

There is a similar trend for net income by lines of business over the last fewmonths.

Financial indicators are on track; there is sufficient working capital, the cash toclaims ratio is positive and the tangible net equity is continues to increase.

Net revenue for July was $8.5 million, which increased year-to-date surplus to $153million.

Based on levels maintained by other similar financially-stable health plans, thecommittee agreed to set a goal for the upper limit of L.A. Care’s financial reserves at500% of the minimum tangible net equity.

Motion FIN 100.1015To accept the Financial Report for the ten months ended July 31, 2015, assubmitted.

Approved unanimouslyby roll call. 6 AYES

Milliman, Inc. Mr. Reilly presented a motion for approval of contracts with Milliman to provideactuarial models and services for Medicare and the California Health Benefit Exchange(Individual Exchange).

Motion FIN 101.1015To authorize staff to execute contracts not to exceed $650,000 in total, withMilliman, Inc., to provide actuarial models, services and support for Medicareand the Individual Exchange through September 30, 2016.

Approved unanimouslyby roll call. 6 AYES

By consensus, theCommittee recommendedthis motion be includedon the Consent Agendafor the October 1 Boardmeeting.

Language Select

Gertrude S. Carter, MD

Gertrude S. Carter, MD, Chief Medical Officer, presented a motion requesting approval toexecute a three-year contract with Language Select for telephonic interpreting services.

Motion FIN 102.1015To authorize the Chief Executive Officer to execute a three-year contract with

175

Finance and Budget CommitteeSeptember 23, 2015Page 4 of 4 APPROVED

AGENDAITEM/PRESENTER

MOTIONS / MAJOR DISCUSSIONS ACTION TAKENLanguage Select for the provision of telephonic interpreting services in theamount of $2,670,000 from January 1, 2016 to December 31, 2018.

FIN 102 and FIN 103were approvedunanimously by roll call.6 AYES

By consensus, theCommittee recommendedMotions FIN 102 and 103be included in theConsent Agenda for theOctober 1 Board meeting.

MCG Contract

Gertrude S. Carter, MD

Dr. Carter presented a motion requesting approval to execute a contract with MCG.Regulatory statute, contractual obligations and accreditation standards require L.A. Caremedical management staff to use evidence-based clinical criteria when determiningmedical necessity for specialty referrals, concurrent inpatient reviews and casemanagement.

Motion FIN 103.1015To authorize staff to execute a contract with MCG for an amount not to exceed$5,000,000 from November 1, 2015 to October 31, 2018.

ADJOURNMENT The meeting was adjourned at 1:36 p.m.

APPROVED BY:

Respectfully submitted by:Malou Balones, Committee Liaison, Board Services __________________________________________Jennifer Carabali, Committee Liaison, Board Services Michael Rembis, ChairLinda Merkens, Manager, Board Services Date Signed _____________________________________

176

Board of Governors

MOTION SUMMARY

Date: November 5, 2015 Motion No. GOV 100.1115

Committee: Chairperson: .

Issue: Approval of 2016 schedule of meetings for the Board of Governors and Committees.

Background: The schedule of meetings will be considered at the November 4, 2015 Governance

Committee meeting and will be distributed to the Board members on November 5, 2015.

Budget Impact: None.

Motion: To approve the 2016 Board of Governors meeting schedule as submitted.

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