Discovery Limited · JSE:DSY
Discovery — Discovery Health Medical Scheme — Shareholder Meeting (June 2024)
77 slides from Discovery's shareholder meeting presentation, Jun 27, 2024
Slide 1: Annual General Meeting
ANNUAL GENERAL MEETING CHARLOTTE MBEWU PRINCIPAL OFFICER 27 JUNE 2024
Slide 2: Ensuring value for our members
Ensuring value for our members 01 02 03 04 05 CURRENT LANDSCAPE ENSURING THE GUARANTEEING REGULATORY AND 2024 AND FOR MEMBERS AND SUSTAINABILITY SUPERIOR QUALITY GOVERNANCE BEYOND THE SCHEME OF THE SCHEME AND VALUE FOR EXCELLENCE MEMBERS Macro-economic Financial strength, ability Delivering the high
Slide 3: Medical Schemes Landscape: Current landscape for members and medical schemes
MEDICAL SCHEMES LANDSCAPE CURRENT LANDSCAPE FOR MEMBERS AND MEDICAL SCHEMES MEDICAL SCHEME HEALTHCARE REGULATORY CONTEXT INDUSTRY CHANGES AFFECTING PRESSURES MEDICAL SCHEMES • Affordability pressures • Aging membership • National Health Insurance • Muted industry growth • Increasing disease burden •
Slide 4: Operating landscape for members and medical schemes
MEDICAL SCHEMES LANDSCAPE OPERATING LANDSCAPE FOR MEMBERS AND MEDICAL SCHEMES AFFORDABILITY MUTED CONTINUED CONSOLIDATION PRESSURES INDUSTRY GROWTH AND FLIGHT TO QUALITY Peaking interest rates increasing Total beneficiaries Number of open medical affordability pressures open medical schemes schemes
Slide 5: Healthcare industry pressures faced by medical schemes
MEDICAL SCHEMES LANDSCAPE HEALTHCARE INDUSTRY PRESSURES FACED BY MEDICAL SCHEMES AVERAGE AGE OF INCREASED OVERLAP OF CHRONIC INDUSTRY OVER TIME DISEASE BURDEN CONDITIONS Average age Chronic ratio DHMS members living with open medical schemes open medical schemes chronic conditions 35.8 26.3% Mental
Slide 6: DHMS committed to engagement with policymakers on workable NHI solution
MEDICAL SCHEMES LANDSCAPE DHMS IS COMMITTED TO CONTINUED ENGAGEMENT WITH POLICYMAKERS TO FIND A WORKABLE SOLUTION FOR THE BENEFIT OF ALL SOUTH AFRICANS DHMS CORE CHALLENGES LOOKING POSITION WITH NHI ACT AHEAD DHMS supports universal Funding of the NHI No impact on membership health coverage and the
Slide 7: Role of medical schemes | Section 33 of NHI Act
MEDICAL SCHEMES LANDSCAPE ROLE OF MEDICAL SCHEMES | SECTION 33 OF NHI ACT Section 33: “Once National Health Insurance has been fully implemented as determined by the Minister through regulations in the Gazette, medical schemes may only offer complementary cover to services not reimbursable by the Fu
Slide 8: Committee established for review of Prescribed Minimum Benefits
MEDICAL SCHEMES LANDSCAPE COMMITTEE ESTABLISHED FOR REVIEW OF PRESCRIBED MINIMUM BENEFITS According to the Medical Schemes Act, Prescribed Minimum Benefits (PMBs) should undergo review at least every 2 years. As communicated in Circular 15 of 2023, the current PMB review is focused on establishing a
Slide 9: Ensuring value for our members
Ensuring value for our members 01 02 03 04 05 CURRENT LANDSCAPE ENSURING THE GUARANTEEING REGULATORY AND 2024 AND FOR MEMBERS AND SUSTAINABILITY SUPERIOR QUALITY GOVERNANCE BEYOND THE SCHEME OF THE SCHEME AND VALUE FOR EXCELLENCE MEMBERS Macro-economic Financial strength, ability Delivering the high
Slide 10: How do we ensure we are here for our members, tomorrow and in the future?
ENSURING SUSTAINABILITY HOW DO WE ENSURE WE ARE HERE FOR OUR MEMBERS, TOMORROW AND IN THE FUTURE? We measure key metrics for a sustainable medical scheme: MEMBERSHIP FINANCIAL STABILITY STRENGTH Membership size Financial performance Quality of membership growth Long-term sustainability Market share
Slide 11: DHMS continues to attract high quality, healthy growth
ENSURING SUSTAINABILITY DISCOVERY HEALTH MEDICAL SCHEME CONTINUES TO ATTRACT HIGH QUALITY, HEALTHY GROWTH STABLE HEALTHY SCHEME BENEFIT DESIGN MEETING MEMBERSHIP NEW GROWTH OF CHOICE MEMBER NEEDS DHMS Young and healthy Market share Majority of members principal members new joiner profile open medica
Slide 12: DHMS continues to provide certainty and stability
ENSURING SUSTAINABILITY DHMS CONTINUES TO PROVIDE CERTAINTY AND STABILITY DHMS IS IN A ROBUST DHMS MOST SUSTAINABLE OPEN FINANCIAL POSITION SCHEME IN THE INDUSTRY IN 2023 Net healthcare result (NHR)* Most sustainable open medical scheme adjusted for increase deferrals** (R’m) 2023/2024 Alexforbes Me
Slide 13: Majority of contribution income used to cover cost of claims
ENSURING SUSTAINABILITY MA JORITY OF CONTRIBUTION INCOME USED TO COVER THE COST OF CLAIMS 2022 2023 EXPENSE BREAKDOWN EXPENSE BREAKDOWN 100.0% 91.7% 56 100.0% 90.8% 57 million million healthcare claims healthcare claims 1.2 million more 1 million more claims than in the claims than in the previous y
Slide 14: Industry-wide introduction of IFRS17 accounting standards
ENSURING SUSTAINABILITY INDUSTRY-WIDE INTRODUCTION OF IFRS17 ACCOUNTING STANDARDS WHAT IFRS17 MEANS CHANGES IN CHANGE IN PRESENTATION OF FOR MEDICAL SCHEMES TERMINOLOGY OPERATING PERFORMANCE IFRS17 is a new accounting standard Key changes to reporting terminology effective from 1 January 2023 for me
Slide 15: 2023 DHMS financial highlights: financial position
ENSURING SUSTAINABILITY 2023 DHMS FINANCIAL HIGHLIGHTS The Scheme remains financially secure Financial position at 31 December 2023 2022 2023 Measure (R ’000) (R ’000) Non-current assets 24,348,071 25,022,693 Current assets 12,512,461 12,281,727 TOTAL ASSETS 36,860,532 37,304,420 Non-current liabili
Slide 16: 2023 DHMS financial highlights: performance
ENSURING SUSTAINABILITY 2023 DHMS FINANCIAL HIGHLIGHTS The Scheme remains financially secure Performance for current year 2022 2023 % change Measure (R ’000) (R ’000) YoY Insurance revenue (risk contribution income) R 65,637,399 R 73,328,203 12% Insurance service expense (relevant healthcare expendi
Slide 17: Key factors determining contribution increase and benefit changes for 2024
ENSURING SUSTAINABILITY KEY FACTORS THAT DETERMINED CONTRIBUTION INCREASE AND BENEFIT CHANGE CONSIDERATIONS FOR 2024 MEDICAL INFLATION VARIED UTILISATION EXPERIENCE FOR 2024 ACROSS DHMS BENEFIT OPTIONS Utilisation index 13% Average utilisation 10.5% Executive CPI + 4% CPI + 3% 9% Comprehensive Prior
Slide 18: Medical inflation for 2024
ENSURING SUSTAINABILITY MEDICAL INFLATION FOR 2024 - + 1.0% - Net: 1.0% 1.5% + - 10.5% + 1.5% 1.0% 4.5% 6.0% Tariffs Supply-side Risk Demand-side Health & Non-healthcare Medical utilisation management utilisation Wellness expenses inflation Rise in the price Demand Managing Demand Managing Managing
Slide 19: Balancing affordability and sustainability in 2024
ENSURING SUSTAINABILITY BALANCING AFFORDABILITY AND SUSTAINABILITY IN 2024 SIMPLIFICATION OF THE KEYCARE BENEFIT ADJUSTMENTS TO OPTIMISATION OF DAY-TO-DAY COMPREHENSIVE SERIES MANAGE DEMAND-SIDE INFLATION BENEFITS Cumulative change in chronic ratio Increased affordability pressures on members 2023 2
Slide 20: DHMS maintains long-term sustainability and affordability
ENSURING SUSTAINABILITY DISCOVERY HEALTH MEDICAL SCHEME MAINTAINS LONG-TERM SUSTAINABILITY AND AFFORDABILITY FOR MEMBERS DIFFERENTIATED CONTRIBUTIONS REMAIN MORE STRONG FINANCIAL OUTLOOK INCREASES IN 2024 AFFORDABLE THAN THE MARKET POST BENEFIT CHANGES Weighted average increase of 7.5% Average contr
Slide 21: Administration expenditure among the lowest in the industry
ENSURING SUSTAINABILITY MEMBERS BENEFIT FROM ADMINISTRATION EXPENDITURE THAT IS AMONG THE LOWEST IN THE INDUSTRY ADMINISTRATION EXPENDITURE AS % OF ADMINISTRATION EXPENDITURE AS % OF GROSS CONTRIBUTION INCOME (2013 – 2022) GROSS CONTRIBUTION INCOME (2022) DHMS All other open schemes Ranked 4th lowes
Slide 22: Members receive outstanding value from Discovery Health
ENSURING SUSTAINABILITY OUR MEMBERS RECEIVE OUTSTANDING VALUE FROM DISCOVERY HEALTH Value generated for DHMS Members For every R2.12 R1 spent R2.08 on managed care and administration fees, R2.03 members of R2.02 DHMS derived R2.08 R1.88* in value Reviewed by Deloitte *Decrease is result of decrease
Slide 23: How do we ensure we are here for our members?
ENSURING SUSTAINABILITY HOW DO WE ENSURE WE ARE HERE FOR OUR MEMBERS, TOMORROW AND IN THE FUTURE? We measure key metrics for a sustainable medical scheme: MEMBERSHIP FINANCIAL STABILITY STRENGTH Membership 2.79m 1.37m Financial R26.9bn 30.6% size Beneficiaries Principal members performance Insurance
Slide 24: Ensuring value for our members
Ensuring value for our members 01 02 03 04 05 CURRENT LANDSCAPE ENSURING THE GUARANTEEING REGULATORY AND 2024 AND FOR MEMBERS AND SUSTAINABILITY SUPERIOR QUALITY GOVERNANCE BEYOND THE SCHEME OF THE SCHEME AND VALUE FOR EXCELLENCE MEMBERS Macro-economic Financial strength, ability Delivering the high
Slide 25: Exceptional healthcare cover for every stage of life
GUARANTEEING QUALITY EXCEPTIONAL HEALTHCARE COVER FOR EVERY STAGE OF LIFE R4.5m R4.1m Trauma R1.7m Heart transplant Lupus R800,000 Near drowning R6m incident Hemophilia 11,300 7,500 R4.9m 30,000 Mental health Surgical R3.8m Liver transplant Births claims procedures on 9,900 Leukaemia uterus/ovaries
Slide 26: Superior healthcare cover and quality for routine healthcare
GUARANTEEING QUALITY SUPERIOR HEALTHCARE COVER AND QUALITY WHEN ACCESSING ROUTINE HEALTHCARE EXTENSIVE PROVIDER NETWORKS TO WITH SUPERIOR, HIGH-VALUE BENEFITS MINIMISE MEMBER SHORTFALLS FOR ROUTINE HEALTHCARE Screening & prevention Benefit Vital screening tests for early detection Discovery Health G
Slide 27: Highest quality care and provider networks for advanced healthcare needs
GUARANTEEING QUALITY HIGHEST QUALITY CARE AND PROVIDER NETWORKS TO MEET THE ADVANCED HEALTHCARE NEEDS OF MEMBERS EXTENSIVE PROVIDER NETWORKS INDUSTRY-LEADING SUPERIOR, HIGH-VALUE BENEFITS TO MINIMISE MEMBER SHORTFALLS HOSPITAL COVER FOR ADVANCED HEALTHCARE Discovery Health In-hospital Extensive mate
Slide 28: Comprehensive cover when members and families need it most
GUARANTEEING QUALITY COMPREHENSIVE COVER WHEN MEMBERS AND THEIR FAMILIES NEED IT MOST 10 of the highest member claims paid in 2023: R69.1 m R9.4m Age 60 Surgical procedures for infectious or parasitic diseases R 8.3m Age 54 Procedures on the nervous system 305 years worth of contributions to R 6.9m
Slide 29: Ensuring value for our members
Ensuring value for our members 01 02 03 04 05 CURRENT LANDSCAPE ENSURING THE GUARANTEEING REGULATORY AND 2024 AND FOR MEMBERS AND SUSTAINABILITY SUPERIOR QUALITY GOVERNANCE BEYOND THE SCHEME OF THE SCHEME AND VALUE FOR EXCELLENCE MEMBERS Macro-economic Financial strength, ability Delivering the high
Slide 30: Strong independent governance structures with majority member-elected trustees
GOVERNANCE EXCELLENCE STRONG INDEPENDENT GOVERNANCE STRUCTURES WITH MA JORITY MEMBER-ELECTED TRUSTEES OUR GOVERNANCE TO PROMOTE DESIRED OUTCOMES STRUCTURES IN ACCORDANCE WITH KING IV INDUSTRY REGULATION AN ETHICAL GOOD CULTURE PERFORMANCE GOVERNS MANDATES BELONG TO Board of SUPPORTS Board ELECT Trus
Slide 31: Roles, responsibilities and fiduciary duties of trustees
GOVERNANCE EXCELLENCE ROLES, RESPONSIBILITIES AND FIDUCIARY DUTIES OF TRUSTEES Provision of administration Scheme sustainability and managed care services Compliance with the Scheme Strategic risk management Rules, the Medical Schemes BOARD OF Act and other legislation TRUSTEES Stakeholder relations
Slide 32: Ensuring value for our members
Ensuring value for our members 01 02 03 04 05 CURRENT LANDSCAPE ENSURING THE GUARANTEEING REGULATORY AND 2024 AND FOR MEMBERS AND SUSTAINABILITY SUPERIOR QUALITY GOVERNANCE BEYOND THE SCHEME OF THE SCHEME AND VALUE FOR EXCELLENCE MEMBERS Macro-economic Financial strength, ability Delivering the high
Slide 33: Enhancing access and delivering the highest quality of care
2024 AND BEYOND ENHANCING ACCESS AND DELIVERING THE HIGHEST QUALITY OF CARE FOR OUR MEMBERS SCREENING POPULATION HEALTH QUALITY AND PREVENTION MANAGEMENT HEALTHCARE Continuous development of existing DHMS is making a significant investment Enhancing quality healthcare through managed care initiative
Slide 34: Increase in screening rates ensures early detection of disease
2024 AND BEYOND AN INCREASE IN SCREENING RATES ENSURES EARLY DETECTION OF DISEASE AND APPROPRIATE CONDITION MANAGEMENT 2023 SCREENING RATES HIGHER THAN EFFECTIVE IDENTIFICATION AND MANAGEMENT OF PRE-COVID-19 LEVELS CHRONIC CONDITIONS Proportion of eligible members screening 6,400+ Unique enrolments
Slide 35: The WELLTH Fund delivers immediate value to members
2024 AND BEYOND THE WELLTH FUND DELIVERS IMMEDIATE VALUE TO MEMBERS 520 000 +R707m Members have activated Paid in claims from the their WELLTH Fund WELLTH Fund +47% WELLTH FUND TOP 5 SERVICES USED INCREASE IN HEALTH CHECKS IN 2023 Dentist R167m GP R157m Physiotherapist R45m 6,400+ Optometrist R41m U
Slide 36: Population health management programmes for high prevalence conditions
2024 AND BEYOND POPULATION HEALTH MANAGEMENT PROGRAMMES TARGETING MEMBERS LIVING WITH HIGH PREVALENCE CONDITIONS OBJECTIVES PROGRAMMES CONDITION MANAGEMENT 35% of members, accounting for 75% of Prevention and management of high Improved outcomes for members costs, are targeted for Population Health
Slide 37: Improving quality and outcomes through value based care and care coordination
2024 AND BEYOND IMPROVING HEALTHCARE QUALITY AND OUTCOMES THROUGH VALUE BASED CARE AND IMPROVED CARE COORDINATION CARE COORDINATION BY A ENHANCED CARE EXPERIENCE AND GUIDING MEMBERS TO SINGLE PRIMARY CARE GP HEALTH OUTCOMES IN YOUR HOME CENTRES OF EXCELLENCE Highly accessible network of Hospital lev
Slide 38: DHMS benefits introduced to ensure value and support member experience
2024 AND BEYOND DHMS BENEFITS INTRODUCED TO ENSURE VALUE AND SUPPORT MEMBER EXPERIENCE SPEAK TO A DOCTOR ENHANCED SUPPORT SUPPORT FOR FOR URGENT CARE FOR MENTAL WELLNESS MUSCULOSKELETAL RECOVERY Access to a dedicated panel of doctors Convenient access to evidence-based internet-based Evidence based
Slide 39: Ensuring value for our members
Ensuring value for our members 01 02 03 04 05 CURRENT LANDSCAPE ENSURING THE GUARANTEEING REGULATORY AND 2024 AND FOR MEMBERS AND SUSTAINABILITY SUPERIOR QUALITY GOVERNANCE BEYOND THE SCHEME OF THE SCHEME AND VALUE FOR EXCELLENCE MEMBERS Macro-economic Financial strength, ability Delivering the high
Slide 40: Annual General Meeting
ANNUAL GENERAL MEETING CHARLOTTE MBEWU PRINCIPAL OFFICER 27 JUNE 2024
Slide 41: Discovery Health Overview
DISCOVERY HEALTH OVERVIEW Discovery Health Medical Scheme Annual General Meeting Dr Ron Whelan, CEO Discovery Health
Slide 42: Our people
OUR PEOPLE 6.2k DISCOVERY HEALTH EMPLOYEES AND CONTRACTORS 42
Slide 43: Discovery Health structured to provide best possible service to DHMS
Discovery Health structured to provide best possible service to Discovery Health Medical Scheme (DHMS) and its members Actuarial Benefit design & modeling Innovation Disease management & managed care >2.7m Policy & Regulation Lives Service & operations Systems excellence 43
Slide 44: Agenda
Agenda 01 02 03 04 NATIONAL HEALTH OPERATIONS AND QUALITY, ACCESS AND INNOVATION INSURANCE UPDATE SERVICE EXCELLENCE COST OPTIMISATION 44
Slide 45: Agenda
Agenda 01 02 03 04 NATIONAL HEALTH OPERATIONS AND QUALITY, ACCESS AND INNOVATION INSURANCE UPDATE SERVICE EXCELLENCE COST OPTIMISATION 45
Slide 46: Overview: National Health Insurance
Overview Discovery Health unequivocally supports universal health coverage and believes that a workable NHI is central to achieving this Implementation will be complex and protracted with no impact on medical schemes for a long time Funding is the core issue; the NHI Act is unworkable without privat
Slide 47: South Africa has significant health resource constraints
South Africa has significant health resource constraints LOWER HEALTHCARE SPEND PER FEWER DOCTORS AND INEQUALITY IN HEALTHCARE CAPITA HEALTHCARE PROFESSIONALS FUNDING Health spend per capita US$ in 2020 Physicians per 1 0002 Healthcare funding available per person (purchasing power parity) 2500 8 00
Slide 48: Almost all countries globally have a private health insurance market
Almost all countries globally have a private health insurance market Countries without a private Countries with a private healthcare insurance market healthcare insurance market 169 countries 17 countries Algeria Central African Republic Gambia Lebanon Oman South Sudan Afghanistan Andorra Chad Georg
Slide 49: Funding is the core problem
Funding is the core problem Healthcare funding available per person remains constrained (R) Impact on public sector Impact on medical 31% increase in personal income tax or; healthcare consumers scheme members 2332 – 69% R200bn 6.5% increase in VAT (from 15% to 21.5%) or; Additional funding 714 714
Slide 50: Timelines between NHI Act and NDoH differ, amendments are likely
Timelines between NHI Act and NDoH differ, amendments are likely 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Significant implementation and legal • Publication of draft regulations complexity • Some appointments to NHI structures No near-term changes to NHI Act • Appointment of Board, CEO and
Slide 51: Agenda
Agenda 01 02 03 04 NHI OPERATIONS AND QUALITY, ACCESS AND INNOVATION UPDATE SERVICE EXCELLENCE COST OPTIMISATION 51
Slide 52: DHMS beneficiaries overview
Discovery Health Medical Scheme (DHMS) beneficiaries overview AVERAGE PRINCIPAL MEMBER AGE AVERAGE MEMBERSHIP DURATION 48 YRS 8.6YRS AVERAGE BENEFICIARY AGE CLAIMS PER MEMBER PER YEAR 37 YRS 23 % MEMBERS LIVING WITH OLDEST MEMBER CHRONIC DISEASES % 106 YRS 32% MEMBERSHIP SPLIT PREFEERRED PLAN SERIES
Slide 53: Discovery Health service and operations overview
Discovery Health service and operations overview NATIONAL FOOTPRINT STAKEHOLDERS INTERACTIONS per annum GAUTENG >2.7m 6,408 82,484,432 5,891,745 420,839 30,060 2,147 153 11 1 0 1,305 DHMS COVERED FINANCIAL CLAIMS RECEIVED TEAM MEMBERS LIVES ADVISORS 13,850,606 1,731,326 216,416 27,052 3,381 423 53 7
Slide 54: Comprehensive support to DHMS beneficiaries across the member lifecycle
Discovery Health provides comprehensive support to DHMS beneficiaries across all stages of the member lifecycle MEMBER LIFECYCLE NEW MEMBER & WELLNESS & BENEFITS & MANAGED ONBOARDING PREVENTION SERVICE SUPPORT CARE Membership activated 35 911 health R49 million paid in 2 785 hospital admissions ever
Slide 55: Data science models enable personalised and precise service
Data science models enable personalised and precise service, and enhanced client experience REGULAR EFI EXEC INBOX IVR SENTIMENT SPEECH ANALYTICS CALL BACK UT D BOUN O VOICE IVR REDESIGN AFFINITY CONSERVATIONS LOW SURVEY CONTACTABILITY SENTIMENT SPAM TOPIC Personalised RKFLOW WO A PP Proactive Senti
Slide 56: Service ratings consistently high across all key stakeholders
10.0 10.0 0.0 2.0 4.0 6.0 8.0 0.0 2.0 4.0 6.0 8.0 Apr-22 Apr-22 Jun-22 Jun-22 MEMBER Aug-22 Aug-22 PROVIDER Oct-22 Oct-22 Dec-22 Dec-22 Feb-23 Feb-23 Apr-23 Apr-23 stakeholders Jun-23 Jun-23 Aug-23 Aug-23 Oct-23 Oct-23 Dec-23 Dec-23 Feb-24 Feb-24 8.7 9.2 Apr 2024 Apr-24 Apr-24 Apr 2024 0.0 2.0 4.0 6
Slide 57: Discovery Health widely regarded as the leading medical scheme administrator
Discovery Health widely regarded as the leading medical scheme administrator across the industry EMPLOYER BROKER PROVIDER 8.60 8.50 8.45 8.30 8.22 8.18 8.09 8.10 8.10 8.10 8.06 8.03 8.00 8.00 8.00 8.00 8.00 8.00 7.97 7.90 7.90 7.90 7.80 7.71 7.53 Sizwe Discovery MMI PPS Bestmed Industry Umvuzo Medih
Slide 58: Agenda
Agenda 01 02 03 04 NHI OPERATIONS AND QUALITY, ACCESS AND INNOVATION UPDATE SERVICE EXCELLENCE COST OPTIMISATION 58
Slide 59: Managed care initiatives yield savings of ~15% of DHMS risk spend
Discovery Health managed care initiatives yield savings to the value of ~15% of DHMS risk spend annually 2022 Managed Care Savings1 (R m) Contracting and Health Professionals Clinical Policy, Medicines and Medical Devices Population Health Management Fraud, Waste and Abuse 8,939 1,544 380 11.1% 4-5x
Slide 60: DHMS average age increasing, more beneficiaries with chronic disease
DHMS average age increasing by 0.3 yrs. p.a., 305k more beneficiaries living with chronic disease since 2015 DHMS average age and chronic ratio DHMS chronic condition and prevalence (%) +64k +94k DHMS member average age Diabetes (158k) Mental Health (172k) 6.0% 0.3 yrs 36.4 p.a. 5.0% 3.5% 3.4% 33.7
Slide 61: Significant increase in DHMS healthcare spend since 2019
Significant increase in DHMS healthcare spend since 2019 – mainly because of increased disease burden, higher utilisation and cost of care HOSPITAL SPEND (R bn) RADIOLOGY SPEND (R bn) ONCOLOGY SPEND (R bn) 96% 40% % of DHMS in- % of DHMS annual +9.8% +12.8% hospital claims paid risk expenditure 3.6
Slide 62: Broad range of initiatives to optimise access, quality and efficiency
A broad range initiatives to optimise access, quality and efficiency of healthcare services for DHMS beneficiaries 1 2 3 4 5 Corporate contracting Health professionals Population health Clinical policy, medicines Fraud, waste and (incl. hospitals, pathology, risk management management and medical de
Slide 63: Increased quality and affordability through provider networks
1 Corporate Contracting 2 Health Professionals 3 Population Health Management 4 Clinical Policy and Medicines 5 Fraud, Waste and Abuse Increased quality and affordability through a range of provider networks DHMS hospital network evolution Other Networks No. of lives 60% 1 048 000 (38%) of new joine
Slide 64: Value-based care programmes to improve quality and outcomes
1 Corporate Contracting 2 Health Professionals 3 Population Health Management 4 Clinical Policy and Medicines 5 Fraud, Waste and Abuse Value-based care programmes to improve quality and outcomes RENAL DIALYSIS ARTHROPLASTY CARDIO CARE Performance against Bundled fee Flat episode fee for quality scor
Slide 65: Extensive engagement with healthcare professionals
1 Corporate Contracting 2 Health Professionals 3 Population Health Management 4 Clinical Policy and Medicines 5 Fraud, Waste and Abuse Extensive engagement with healthcare professionals to provide support and strengthen the health system Future of Collaborative think-tank of senior doctor leaders ch
Slide 66: Population health management interventions focus on biggest areas of spend
1 Corporate Contracting 2 Health Professionals 3 Population Health Management 4 Clinical Policy and Medicines 5 Fraud, Waste and Abuse Discovery Health population health management interventions focus on biggest areas of spend and greatest potential impact ~R37.8bn (58%) Diabetes (R9.5bn) of total s
Slide 67: Comprehensive population health programmes for members with chronic disease
1 Corporate Contracting 2 Health Professionals 3 Population Health Management 4 Clinical Policy and Medicines 5 Fraud, Waste and Abuse Comprehensive population health management programmes supporting members living with chronic disease PREDICTIVE AND RISK-BASED APPROACH CARE PROGRAMMES Complex cases
Slide 68: High-cost drugs are a significant contributor to oncology costs
1 Corporate Contracting 2 Health Professionals 3 Population Health Management 4 Clinical Policy and Medicines 5 Fraud, Waste and Abuse High-cost drugs are a significant contributor to oncology costs MARKET-LEADING ONCOLOGY BENEFITS ONCOLOGY ACCOUNTS FOR ~50% OF HIGH -COST DRUG SPEND ADVANCED ILLNESS
Slide 69: Agenda
Agenda 01 02 03 04 NHI OPERATIONS AND QUALITY, ACCESS AND INNOVATION UPDATE SERVICE EXCELLENCE COST OPTIMISATION 69
Slide 70: Innovation in line with global healthcare trends
Discovery Health innovation in line with global healthcare trends; DHMS members at the centre of all innovation VALUE AND IN YOUR HANDS AT HOME ACCESSIBLE PERSONALISED VALUES Proliferation of Substantial growth Increasing shifts Big data and Consumers seeking mobile health apps in at home towards da
Slide 71: New Discovery Health App is the digital front door
New Discovery Health App is the digital front door for the health system SPEAK TO ORDER VIRTUAL DIGITAL THERAPEUTICS A DOCTOR NOW MEDICINE PHYSICAL THERAPY FOR DEPRESSION Speak to a doctor Order over the counter meds Professional support for Convenient access to for urgent care through our pharmacy
Slide 72: Discovery Health App and HealthID digital health ecosystem
Together, the Discovery Health App and HealthID bring to life a unique digital health ecosystem for DHMS members Member Health App Health ID (Consumers) (Healthcare Providers) My cover Get care My Health Personal Patient Chronic illness Patient programme (manage funds) (speak to a doctor (Health his
Slide 73: Alternative settings of care promoting greater accessibility
Alternative settings of care promoting greater accessibility CONVENIENT CARE RETAIL-BASED PRIMARY DAY CLINICS POINT OF CARE CENTRES CARE CLINICS Routine surgeries shifting from Imaging and lab services shifting Treatments shifting to bespoke Primary care shifting from acute hospitals to day clinics
Slide 74: Sophisticated data science and AI for personalised healthcare
Sophisticated data science and AI to make healthcare more personalised and precise for members of DHMS >30 YEARS CLINICAL, LIFESTYLE & BEHAVIOURAL INSURANCE DATA LIFESTYLE DATA BEHAVIOURAL DATA CLINICAL DATA Exercise Engagement Pathology Family history Sleep Propensity Doctor consults Chronic condit
Slide 75: Behaviour change proven to reduce mortality and healthcare costs
Clinical and lifestyle behaviour change proven to reduce mortality and healthcare costs REDUCED MORTALITY RISK REDUCED HEALTHCARE COSTS IMPROVED BEHAVIOUR AND HABITS Relative mortality In-hospital reduction* (over 1 year) Value of healthy habits Age 45-65 (Causal risk-adjusted model) 0 (base) Low Me
Slide 76: Personal Health Pathways available to all DHMS adult members
Personal Health Pathways available to all 2.1 million DHMS adult members Health and lifestyle progress Healthy actions ring Complete recommended next best actions to close ring. Unlock rewards based on value to the Scheme when closing ring Personalised next best Exercise ring Weekly physical activit
Slide 77: Our core purpose
Value Values Our core purpose is to make people healthier and to enhance and protect their lives 77
Discovery Health Medical Scheme — Shareholder Meeting (June 2024) on 6ix