“Cleveland Clinic, a non-profit academic medical center, provides clinical and hospital care and is a leader in research, Innovation, education and health information.”

Cleveland Clinic

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At the vanguard of the changing At the vanguard of the changing healthcare delivery modelhealthcare delivery model

The Future of Healthcare

HospitalsNO LONGER IN THE “HOTEL”

BUSINESS

What was to WhatWill Be

A Perfect Storm?

Regulatory

FinancingHealthcare Reform

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• Demographic/Clinical Trends− A rapidly aging population;

need for long term chronic disease management − Preventable Diseases− Our bodies out living our brains

• Healthcare Reform− Payors taking action to reduce reimbursements,

placing increasing pressure on hospitals to manage costs − Beyond the Hospital a continuum of care

• Regulatory Environment− FDA uncertainty; longer, more expensive approval cycles

• Private Financing Trends− Venture financing availability severely limited− Early stage funding challenging

Macro Drivers in a Changing Environment

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The New World in Healthcare DeliveryVolume-Based Value-Based

Payment Fee-for-Service Outcome Based

Incentives Volume Value

Focus Acute Episodes Populations

Role of Provider Single Episodes Care Continuum

Information Retrospective Predictive

New Economics Drive New NeedsNew Needs Drive New Innovation

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Adapting to the New Innovation Environment

A new drug or device has to be either much better than the standard of care

at the same costOr

Equivalent to the standard of care at a much lower cost

Jack Lasersohn, Vertical Group

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The Future of Healthcare Delivery

Health Care Process

Symptoms

Primary Diagnosis

Recommendation

Second Opinion

Confirmation

Alternatives

Care System

Cleveland Clinic Integrated Care Model

Retail Venues Home

CC ClinicCommunity- Based

Organizations

Ambulatory D&TIndependent Physician

Offices

Hospitals

Rehab

Skilled Nursing Facilities

MyChart

EmergencyPost-Acute(other)

An enterprise-wide eHealth services program that is

presently changing the paradigm of medical practice

by applying Health IT solutions to improve patient

care, enhance operational and administrative

efficiency, reach out to patients and community

physicians, and create new knowledge through

ongoing research and education initiatives.

ClevelandClinic

HFairview Hospital

Lakewood Hospital

H

Lutheran Hospital

H

Ashtabula County Medical Center

H

Euclid Hospital

H

Hillcrest Hospital

H

South PointeHospital

H

Marymount Hospital

H

ClevelandClinic

Florida

HMedinaHospital

HLorain Family HealthAnd Surgery Center

FHC

Elyria FamilyHealth Center

Westlake FamilyHealth Center

FHC

FHC LakewoodFamily Health

Center

FHC

Strongsville Family Health and Surgery Center

FHC

Brunswick FamilyHealth Center

FHCWooster FamilyHealth Center

FHC

Independence FamilyHealth Center

FHC Solon FamilyHealth Center

FHC

Chagrin Falls FamilyHealth Center

FHC

Beachwood FamilyHealth and Surgery Center

FHC

Willoughby HillsFamily Health Center

FHC

FHC

R.E. JacobsHealth Center

Lou Ruvo Centerfor Brain Health

Las Vegas, Nevada

FHC

ClevelandClinic

Toronto

FHC

S.T.J. Health Center

HC

Twinsburg FamilyHealth Center

FHC

Patients in MyPractice: 6.7 Million (Electronic Medical Record System)

MyPractice:Electronic Medical

Record System

MyPractice:Electronic Medical

Record System

Dr.Connect:Improved

Communication; Improved Care

MyPractice:●

Community

eHealth Services

VirtualVisit:Patient/Physician

Interaction Globally

MyConsult:Your First Choice for

a Second Opinion

MyChart:Your Personal

Health Connection

MyMonitoring:Ongoing Condition

Reporting from Home

Providers Patients

MyPractice●

Hospital

True Value of Health Data Exchange to Cleveland Clinic Patients

All data available to Cleveland Clinic treating

physicians

Patient transfers data from all physicians, hospitals, retail pharmacies, commercial laboratories and digital devices.

Physicians Hospitals Com. LaboratoriesRetail PharmaciesHome Devices

Patient transfers data to Cleveland Clinic MyPractice

MyPracticeElectronic Medical Record System

NHINStateHIE

Since 1921A Unique Model of Care

• Four doctors share a vision

- Non-profit, physician-led group practice

- Collaboration across disciplines

- All physicians are salaried

- Patient-centered mission

FRANK E. BUNTS, MDFRANK E. BUNTS, MD

JOHN PHILLIPS, MDJOHN PHILLIPS, MD

GEORGE CRILE SR., MDGEORGE CRILE SR., MD

WILLIAM E. LOWER, MDWILLIAM E. LOWER, MD

The Cleveland Clinic • Founded in 1921

• Not-for-profit group practice

• 3,034 physiciansand scientists

• 1,300 bed hospital

• 16 Family Health Centers

• Cleveland Clinic System Statistics:*

♦ Clinical visits: 5,085,842 ♦ Surgical cases: 200,808♦ Admissions: 157,474 ♦ Emergency visits: 456,613

• Health System Hospitals:♦ Euclid♦ Fairview♦ Hillcrest♦ Lakewood♦ Lutheran♦ Marymount♦ South Pointe♦ Cleveland Clinic Florida♦ Medina

The Cleveland Clinic

*Cleveland Clinic 2012 Annual Report, “A Unique Model of Medicine;” remaining, Cleveland Clinic “Facts and Figures, 2013”

CLEVELAND CLINICCLEVELAND CLINIC INNOVATIONS &

GLOBAL CARDIOVASCULAR INNOVATON CENTER

BACK UP INFORMATION

• 5.1M Patient Visits 5.1M Patient Visits

• 43,890 Employee Caregivers43,890 Employee Caregivers

• 27 Institutes providing care in 120 27 Institutes providing care in 120 subspecialtiessubspecialties

• LocationsLocations• Main CampusMain Campus

• 8 Community Hospitals 8 Community Hospitals

• 16 Family Health Centers in NE Ohio16 Family Health Centers in NE Ohio

• Facilities in Florida, Nevada, Toronto & Abu DhabiFacilities in Florida, Nevada, Toronto & Abu Dhabi

• EMR Leader – My ChartEMR Leader – My Chart

• Top 4 Hospital by U.S. News & World Top 4 Hospital by U.S. News & World ReportReport

Cleveland ClinicCleveland Clinic

• 2,500 Patent Applications2,500 Patent Applications• 450 Royalty Licenses450 Royalty Licenses• 67 Spin-Off Companies67 Spin-Off Companies• $768M in Equity Investments$768M in Equity Investments• $68M to Inventors$68M to Inventors• $150M in State Grants$150M in State Grants• 1,200 Jobs Created1,200 Jobs Created• World-Wide RecognitionWorld-Wide Recognition

Innovations Scorecard: 2013Innovations Scorecard: 2013

Global Cardiovascular Innovation CenterMission and Scope

• Catalyze economic development in Ohioby developing, incubating andcommercializing cardiovasculartechnology

• A consortium of university, hospital,industry, and economic developmentpartners within Ohio

• Established by $60M grant from Ohio Third Frontier Project, 2007

• Also managing

• Goals:• Job Creation: 855 at average wage of $69,500• New Venture-Backed and Recruited Companies: 43• Seed and Venture Capital Invested: $207M

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GCIC Programs

• Commercialization Funding• Provide seed funding and support to new product development

• Product Development Acceleration Provide product management and business planning support

by industry-experienced staff

• Business Attraction Bring new businesses to Ohio

to grow the Cardiovascular cluster

• New Company Incubation Operate and manage incubator facility

for start-up companies

• Preclinical Investigation Capabilities Operate state-of-art preclinical facility

for sponsored research, product development, procedure training

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GCIC as Enabler

Beyond our Funding Programs…

•Provide Project Management Guidance• Hands-On Project Management• Design Input, Prototyping Resources• Business Strategy• Market Analysis• Clinical, Regulatory Strategy• Cost/Reimbursement Strategy• Staffing Referrals

•Position Companies for Follow-on Funding• Commercialization Advisory Board Visibility

•Education Programs for Inventors and Developers

•Incubation Space and Services

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GCIC – a Successful Catalyst and Magnet for New Business in Ohio

• 57 Commercialization Funding Awards Granted.• $17.9M awarded for development of 48 technologies• Supporting 37 companies and 8 institution-based projects

• 21 New Businesses Attracted to and Operating in Ohio.

• GCIC Incubator facility supporting 29 companies.

• 847 Added Ohio Jobs in Companies Funded, Attracted or Incubated by GCIC. Growing steadily as companies mature

• $734 Million in Follow-on Funding, M&A Returns Secured. Growing significantly as companies secure additional later round financing

As of end Q3 2014

“The future belongs to those who seize the opportunities created by innovation.“

Delos M. Cosgrove, MDCEO & PresidentCleveland Clinic

The Future of Healthcare