© CGI Group Inc.

Innovation Opportunities for Health

Kelowna Health Summit June 23, 2015

Canada underperforms relative to other countries.

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AUS CAN FRA GER NETH NZ NOR SWE SWIZ UK US

Overall Ranking (2013) 4 10 9 5 5 7 7 3 2 1 11

Quality Care 2 9 8 7 5 4 11 10 3 1 5

Effective Care 4 7 9 6 5 2 11 10 8 1 3

Safe Care 3 10 2 6 7 9 11 5 4 1 7

Coordinated Care 4 8 9 10 5 2 7 11 3 1 6

Patient Centered Care 5 8 10 7 3 6 11 9 2 1 4

Access 8 9 11 2 4 7 6 4 2 1 9

Cost Related Problem 9 5 10 4 8 6 3 1 7 1 11

Timeliness of Care 6 11 10 4 2 7 8 9 1 3 5

Efficiency 4 10 8 9 7 3 4 2 6 1 11

Equity 5 9 7 4 8 10 6 1 2 2 11

Healthy Lives 4 8 1 7 5 9 6 2 3 10 11

Health Expenditures / Capita, 2011** $3,800 $4,522 $4,118 $4,495 $5,099 $3,182 $5,669 $3,925 $5,643 $3,405 $8,508

Country rankings

Top 2*

Middle

Bottom 2*

Notes: * Includes ties. ** Expenditures shown in $US PPP (purchasing power parity); Australian $ data are from 2010.Source: Calculated by The Commonwealth Fund based on 2011 International Health Policy Survey of Sicker Adults; 2012 International Health Policy Survey of Primary Care Physicians; 2013 International Health Policy Survey; Commonwealth Fund National Scorecard 2011; World Health Organization; and Organization for Economic Cooperation and Development, OECD Health Data, 2013 (Paris: OECD, Nov. 2013).

Drivers of healthcare expenditure growth between 1995 and 2009 in OECD countries

Healthcare expenditure growth

1. Population Growth & Aging

2. Price Inflation of Health Goods &

Services & Physician Expenditures

3. Inefficiencies in Health System Delivery

Health Costs are rising faster than Inflation

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Source: National Health Expenditure Trends, 1975 to 2014, Canadian Institute for Health Information, Oct. 2014

How do we sustain our Healthcare system?

Healthcare will absorb 69% of total revenues available to provinces / territories by 2037 (compared to 44% today) at current rate, and the system will not be sustainable at current levels unless we implement:

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Significantly increase GDP growth

Increase taxes / healthcare usage fees

Reduce/Cut Other Government Programs

Lower cost methods of healthcare delivery

Source: Sustainability of the Canadian Health Care System and Impact of the 2014 Revision to the Canada Health Transfer, Canadian Institute of Actuaries, Sept. 2013

Invention

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Traditional management methodology

Innovation

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New approaches to innovation Innovation

North America’s first fully Digital Hospital

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Benefits

Building Automation

Fire System

RTLS AGVs

Pharmacy Robotics

Wayfinding Security

CCTV

Nurse Call

Unified Communications

Mobile

Laptops / Bedside

Person Directory

Email EHR

RFID

Medical Equipment

Connect

Patient Flow Code call workflow Equipment Utilization Self Registration

Action situational awareness Intelligent Agents

Know me…who, where, what Follow me…across devices, channels Serve me…search, inform, act

100+ vendors 40,000 endpoints 1,000s events / day M’s digital transactions / day

X X =

Patient & Family Engagement

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Coordinator Manager

Relatives

Client, Patient

360° care

Clinician

Impact

•  Time dedicated to clients has increased 30% •  The feeling of safety has increased amongst patients, clients and care

providers; Security of clients homes improved with wireless door locks •  Reduced Hospital (re) admissions by 10% to 30%

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Targeted Disease Prevention

Early Disease Detection

Accelerated Diagnosis

Targeted Therapy

Improves Outcomes

ê$

Precision Medicine in Clinical Care

Achieving Full Value from Analytics

Diagnostic Analytics

Predictive Analytics

Prescriptive Analytics

Descriptive Analytics

What happened?

Why did it happen?

What will happen?

How we can make it happen

in the best feasible way?

Analytics Maturity

Measurable Business

Value

Prescribe an alternate more cost effective course of action, preapprove payments for preventative therapy such as life style courses

Bus

ines

s In

telli

genc

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dvan

ced

Ana

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Adapted from Davenport & Harris’s Competing Analytics: the New Science of Winning (2007)

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Optimizing Performance

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16% increase in access to inpatient

beds

2000 fewer unnecessary ED

visits annually

Annual cost savings of up to $18M CAD

Increase in 1000 elective procedures

annually

“The findings of the proof-of-concept are not exact results but are derived from real data and scenarios and do show direction and comparability of the impact of the scenarios.”

Jewish General Hospital, Montreal •  637-bed university teaching hospital •  23,000 admissions, 300,000 outpatient

visits, 67,000 emergency visits, 4,000 births annually

Key challenges with ED Visits •  Fixed funding •  Inability to turn patients away •  Numerous discharge barriers

What is the impact across the hospital of changes to clinical service programs and how can we optimize operations?

Funding: Sources of Capital in US, UK, Canada Limited funding sources in Canada beyond Governments1

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Model Description Risk Ownership

Government financed

Funded through government tax revenues or government-issued debt Government

Philanthropy Gifts from donors and fundraising efforts through healthcare foundations’

campaigns Healthcare institution

Working Capital Self financing of capital project from healthcare institutions’ own reserves/

operating margin Healthcare institution

Design-build-finance-maintain

(DBFM) P3

Integration of multiple phases of a capital project into a single contract that shifts project risks to a private consortium in return for a risk premium

Private consortium

Debt capital (bonds, etc.)

Debt issued directly by healthcare institutions, technically unsecured by government

Healthcare institution

Equity offerings Equity issued by healthcare institutions Investors

Financial Engineering

Vendors bundle cost of capital expenditure in “per use model” limiting up front capital expenditures. Arrangements where capital is provided in

exchange for longterm contracts, etc. Shared

Social finance A partnership agreement between government, private investors, and agencies with social outcomes targets as basis for financial returns

Shared

1Capital Spending in Healthcare: A Missed Opportunity for Improvement, CFHI, June 2013

Examples of funding innovation

How do Health systems afford Innovations given our fiscal constraints?

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P3 / DBFM Leveraging private financing to include ICAT solutions in a new Hospital build.

Benefits funded Innovation Leverage analytics & technology to reduce overhead costs; re-direct Capex & Opex funds towards Innovation.

Hitesh Seth Global Health Industry hitesh.seth@cgi.com 416-716-9630