Medica 2019 Annual Report

Our 2019 annual report, The Power of Community, highlights the accomplishments and impact of Medica and the Medica Foundation in communities across the heartland of America.



Looking back through the lens of 2020 — with its pandemic, economic crisis and the pain being felt throughout our community — 2019 seems like a lifetime ago. However, 2019 did prepare us well for what was to come. At Medica, 2019 is remembered as a successful year of growth and expansion, enhanced stewardship, furthering our collaboration with trusted partners, innovation and bold thinking, and compassionate and timely responses to the needs of the individuals and communities we serve. It’s part of our culture at Medica to start and end meetings by sharing real experiences of how we deliver on our mission to be your trusted health plan of choice. We call these special times “Mission Moments.” On behalf of the entire Medica team, I’m pleased to share some of our 2019 Mission Moments with you in this report.

John Naylor President & CEO

We’re your neighbor. We’re proud of the relationships we’ve built with our members, business partners and fellow nonprofit organizations across nine states in the heartland of America. From our home base in Minneapolis- St. Paul to our regional offices in Duluth, St. Cloud, Fargo and Omaha, Medica is your neighbor. Look us up! Learn more about us in this report. You can also find us at or by searching @Medica4Me on Facebook, Twitter, Instagram and YouTube.









Our vision is to be trusted in the community for our unwavering commitment to high-quality, affordable health care. Our mission is to be the trusted health plan of choice for customers, members, partners and our employees.

THE POWER OF Performance

As a nonprofit health plan, we’re committed to understanding and responding to community needs. In 2019, we offered new health insurance products in every market segment and extended our reach to more people and places than ever before.

Case Study: Medica + CHI Health

ACOs Drive Growth and Improve Health We partner with premier health systems across our service area to create Accountable Care Organization (ACO) products that deliver high-quality, affordable care with personalized service and support. In 2019, more than 150,000 Medica members were enrolled in an ACO product featuring a trusted local provider system. We’re able to deliver more effective care for these members by sharing data and working with our care system partners to encourage adherence to evidence-based best practices, reduce variation, close gaps in care, and continuously pursue improvement opportunities. It works. Members enrolled in our ACO health plans during 2019 experienced fewer hospitalizations, fewer hospital readmissions, fewer emergency room visits, and higher rates of preventive care utilization compared to members in open- access networks. When care is more appropriate, efficient and effective, member satisfaction follows. In fact, 97% of all Medica members who were enrolled in an ACO plan through an employer group during 2019 renewed it for 2020.

It’s in our DNA to partner with the health care systems our members know and trust. CHI Health — a leading health system with 14 hospitals and 400 providers across eastern Nebraska and southwestern Iowa — is a great example. With more than 30,000 members enrolled in our Medica with CHI Health SM individual and family plans by 2019, it was only natural to extend the benefits of our partnership to other market segments. We offered our first ACO-type Medicare Advantage plans to seniors in the Lincoln/ Omaha/Council Bluffs area in the fall of 2019, and are expanding the Medica with CHI Health ACO-plan portfolio to employer groups for 2021 enrollments.

Our ACO Partners Altru Health System | Ascension St. John | CHI Health | Essentia Health | LifeCare Health Services M Health Fairview | Mayo Clinic | Nebraska Health Network | North Memorial Health | Park Nicollet Health Services Ridgeview Medical Center | Saint Luke’s Health System | Stormont Vail Health | UnityPoint Health

The More We Grow, the More We Give We’re continuously learning about local needs and lending our support to community-based efforts to improve health and well-being. As our service area has expanded, the Medica Foundation’s grant making has followed. Nebraska is a great example:

2018 3 GRANTS TOTALING $75,000

2019 20 GRANTS TOTALING $397,000

Investing in Community Health In 2019, the Medica Foundation awarded 137 grants to nonprofit organizations in Minnesota, Nebraska, North Dakota, South Dakota, Wisconsin and Iowa. Our giving, which totaled more than $1.8 million, was concentrated for strategic impact in the following funding areas:

$520,000 Early Childhood Health

$450,000 Behavioral Health

$325,500 Rural Health

$314,500 General Health Improvement

$200,000 Mental Health & Housing

To learn more, visit .

JDRF @JDRF We applaud health insurance provider, @Medica4Me as they

THE POWER OF Innovation Being innovative requires more than bright ideas. It takes courage. Boldness. A willingness to be the first to try, and sometimes to fail. To question what is, to envision what could be, and to blaze a trail between them. Tackling the Insulin Crisis The cost of insulin has risen so much in the last decade that it has actually become one of the life-threatening complications of diabetes. According to the medical journal Diabetes Care , the annual per-capita expense for medications to treat diabetes reached nearly $5,000 by 2017. Unable to afford their medicine, many people began to ration it and some died as a result. We recognized this issue as a public health crisis, and we knew we couldn’t wait for others to solve the problem. We chose to act immediately to protect our members. In August 2019, we announced a limit to the member out-of-pocket cost for insulin. We implemented a cap of $25 per month for our individual and fully insured group members in Minnesota, North Dakota, South Dakota and Wisconsin, with no increase in premiums. We were the first health plan in our service area to do so, as noted by the many journalists, political leaders and diabetes advocates who spread the word and cheered our move. We were proud to lead our industry on this important issue.

announce a monthly cap for out-of- pocket expenses for #insulin. We continue to urge other plans to do the same to ensure this life-saving drug is affordable for those who need it. #Coverage2Control

Jill Burcum @jburcum Bravo, Medica! Glad to see this MN insurer volunteer one of the many solutions needed for insulin affordability crisis. Private sector shouldn’t wait for #mnleg. Would like to see @_HealthPartners, @ucaremn & Blue Cross MN step up.

– Star Tribune editorial writer

New Interventions for Youth Experiencing Homelessness The Medica Foundation awarded a strategic grant of $200,000 to YouthLink, a Minneapolis nonprofit that connects youth ages 16-24 who are experiencing homelessness with community resources to meet their immediate needs and help them build stable futures. We were impressed with YouthLink’s innovative proposal to develop a holistic, trauma- informed model that integrates health and wellness support into every point of contact with the youth they serve. The needs of homeless youth go beyond food, shelter and safety. More than 80% of the 2,000 young people YouthLink serves each year have experienced some form of abuse, trauma or victimization in their lives. Survivors of childhood trauma often have difficulty regulating their emotions in response to stress, which can lead to negative consequences in housing, school, employment and relationships. With our grant, YouthLink invested in important training to help staff to recognize the many stress triggers of homeless youth. YouthLink also created a dedicated space where young people can relax, center themselves and practice self-calming skills. With its new Integrative Health and Wellness Service Model in place, YouthLink has transformed from an organization focused on crisis intervention to one that is well equipped to provide long-term solutions for the unique mental, physical, emotional and spiritual needs of homeless youth.

“I want to extend to you, on behalf of all of us here at Nebraska Farm Bureau, a BIG THANK YOU for your work in keeping our plan alive and well.” Rob Robertson Chief Administrator, Nebraska Farm Bureau

Protecting Access to Affordable Coverage

With some farm families paying as much as $40,000 a year for premiums in the individual market, the scarcity of affordable health care options was a top concern of Nebraska Farm Bureau members in 2018. A solution was urgently needed, so the Farm Bureau teamed with Medica to offer a large-group Association Health Plan (AHP) in 2019. Farmers and ranchers who didn’t qualify for a subsidized premium in the individual market could save as much as 25% by signing up, and a lot of them did. The Farm Bureau AHP suffered a setback almost immediately. In March 2019, a federal court ruled that sole proprietors aren’t permitted to participate in group AHPs under the Affordable Care Act (ACA). Absent another innovative solution, many Nebraska farmers and ranchers would lose their coverage. We immediately sat down with the Farm Bureau and got to work. Together, we created limited-duration policies under the ACA that provide farmers and ranchers with access to affordable coverage on an interim basis and buy time for a long-term solution to emerge as the ACA is further shaped by Congress and the courts. These policies now cover more than 1,100 people across Nebraska who otherwise would have lost coverage.

$318,000 total funds granted to YouthLink over 12 years to develop innovative approaches to supporting homeless youth


We’ve built our business and our reputation on a foundation of trust achieved through collaboration and partnership. You can count on us to deliver on our commitments, and you know there’s a friendly face and an outstretched hand whenever you need us.

Partnering with Providers to Improve Health Care Through our unique Accountable Care Organization (ACO) arrangements, we work closely with leading health care providers across our nine-state service area to improve quality, manage costs and enhance the experience of care. Face-to-face relationships and collaboration are key to the exceptional outcomes we achieve together. During 2019, Medica clinical teams hit the road for at least two site visits with each of our 14 ACO health system partners. In these sessions, we sit down with health system leaders to review clinical data for our shared ACO members, identify opportunities for improvement, plan interventions and monitor our progress against shared goals. We also hosted our second annual ACO Clinical Engagement Summit in September 2019 at our headquarters in Minnesota. The event brought together dozens of clinical leaders from our ACO partner health systems across the Midwest to discuss population health and share peer-to-peer insights. We focused on topics such as telehealth, collaborative care management, predictive modeling and the social determinants of health.

Helping Our Members Navigate Coverage Options

Health insurance is complicated. We make it easier to choose and use our plans by taking time to connect in person with our members, customers and their trusted agents each year at enrollment time. During the fall of 2019, we:

Omaha, Nebraska

Reaching Out to Our Friends and Neighbors

Hosted 17 training sessions attended by more than 1,300 insurance agents across nine states to help them learn about our coverage options for employer groups, individuals, families and Medicare beneficiaries in 2020.

Engaging with the communities we serve is a big priority for Medica. The grant making of the Medica Foundation is an important way for us to establish real connections with the organizations and people who are doing critical work to advance health and well-being at the community level. In 2019, we were thrilled to begin building new connections in Omaha and Kearney, Nebraska, through a series of outreach meetings with local nonprofit organizations, health systems, public health departments and foundations. Participants came together to share their challenges and successes, and help us learn about the health needs in their communities. Their authenticity and willingness to share insights is informing our philanthropic focus as we expand our giving in Nebraska. We’re looking forward to continuing these discussions in different regions across the state.

Served up coffee, cookies, flu shots, benefit information and one-to-one customer service to nearly 2,000 seniors who dropped in at one of 13 Medicare member meetings.

Attended worksite open enrollment meetings for 213 employer groups to answer their employees’ questions about benefit options for the 2020 plan year.

Protecting Health Care Data

We earned our HITRUST certification in 2019 by demonstrating our compliance with a set of 465 health care information security standards. This certification assures our members, customers and business partners that Medica has a best-in-class program for protecting health care data.

THE POWER OF Adaptability Nothing is more certain than uncertainty, and change is the only constant. That’s why we’re always learning and innovating to meet the changing needs of our members and communities, and responding to the demands of the place and the moment.

When There’s a Better Way, We Find It

In 2019, we redesigned our clinical model for behavioral health care to enhance our ability to deliver the right care at the right time for members at all levels of risk from mental health challenges. Oftentimes, when our members have medical illnesses or injuries, emerging mental health issues are overlooked. Our new clinical model is supported by data analytics that identify members with serious medical conditions — such as a recent heart attack, stroke or cancer diagnosis, or a chronic condition like diabetes — who also have an emerging mental health concern such as depression, anxiety or substance use. We reach out to these members with integrated physical and behavioral health case management services that address the member’s conditions in a holistic way. Our Employee Assistance Program (EAP) is another way we help our members with stress and other difficulties that can trigger or worsen existing mental health problems if not addressed. EAP provides no-cost counseling and specialized support services for a wide range of life challenges. In 2019, we raised the annual number of EAP sessions included in most of our benefit plans from three visits to five.

1 in 5 American adults experiences mental illness each year Source: National Alliance on Mental Illness

When We See a Need, We Respond

Access to affordable dental care is a challenge for low-income families everywhere, and especially so in rural areas and among culturally diverse communities. In fact, the Minnesota Department of Health reports that only 42% of children on Medical Assistance had a dental visit in 2018, while 81% of all Minnesota children 1-17 years of age saw a dentist that same year. The nonprofit Children’s Dental Service (CDS) has responded by building a network of more than 700 mobile dentistry sites across Minnesota. Most of its staff are members of minority populations themselves. The CDS team is able to speak with patients in more than 20 languages. The key to CDS’ success is its cultural competency and adaptable model of partnering with community service organizations. We’ve supported CDS since 2006 with a series of grants that now total $295,000. In 2019, the Medica Foundation awarded a $25,000 grant to help CDS establish ties with Duluth-area schools and community organizations that serve Native Americans, which then became mobile dental clinic sites for CDS. As a result, more than 700 Native American children received culturally appropriate preventive dental exams and restorative treatments at little or no cost.

When Disaster Strikes, We Step Up When heavy rains and rapid snowmelt triggered catastrophic floods throughout Nebraska in March 2019, we acted quickly to support our members, friends and neighbors. We worked with our business partners to ensure that members in flood-stricken areas could access their providers, prescriptions, and resources for emotional support. The Medica Foundation issued emergency grants to the American Red Cross and the Nebraska Farm Bureau to provide shelter, meals, comfort and recovery supplies in the hardest-hit areas.

43% of preschool-aged Native American children have untreated tooth decay

Source: Pew Charitable Trusts

THE POWER OF Integrity

When you’re with Medica, we’re with you . It’s that simple. We honor our commitments and go the extra mile to be the health plan our members, customers, providers, and business and community partners can trust. We won’t let you down.

‘Medica Saved My Life’ Scott Anderson, 66, decided a few years back it was time to get serious about fitness. His Medica Advantage Solution ® plan includes a gym membership, so he joined the YMCA and started working out four times a week. By switching up classes – spin, weights, yoga, Zumba, step aerobics and reform Pilates – Scott lost 40 pounds while gaining a community of friends among the other Y members and instructors. Last year, Scott tapped into another benefit of his Medica plan: an in-home physical. During nurse practitioner Kati Kaushal’s visit with Scott at his home, he mentioned he’d recently felt some chest pain and tightness. It had happened in spin class, when climbing stairs and while walking his dog just prior to Kati’s arrival. Scott suspected acid reflux, but Kati saw the warning signs of an impending heart attack. She took Scott’s blood pressure, which was very high at 170/100, and recommended he go straight to the ER. Scott agreed, but wanted to wait for his wife to return home from shopping so she could drive him there. “With Scott’s permission, I called his wife and urged her to come home quickly,” recalls Kati. “I also called the ER to report Scott’s condition and let them know he’d be coming in, and stayed with him until his wife arrived.” Scott’s trip to the ER turned into an overnight stay for observation and tests, then a trip to the operating room where he received a stent. Scott’s doctor told him afterward that the main artery to his heart had been 95 percent blocked.

Scott Anderson and Kati Kaushal, DNP, FNP-C.

“I’m grateful I got a physical that day... I tell people that Medica saved my life.”

Scott Anderson Medica member

It’s Who We Are Supporting communities is part of Medica’s culture. In 2019, our employees took advantage of their volunteer time off (VTO) benefit and they also gave $400,000 to charitable causes during our annual employee giving campaign. 1,650 EMPLOYEES 7,000 HOURS OF SERVICE 200 NONPROFIT ORGANIZATIONS

Medica employee Natasha Farhat

Building Capacity for Needed Care

1:1 Support Makes a Difference

We’ve shown our commitment to HealthFinders Collaborative (HFC) with multiple grants over the past decade. HFC is a community-based nonprofit that plays a vital role in its local health care system by providing health care services and wellness programming for immigrants and other underinsured populations in Rice County, Minnesota. In 2019, HFC combined a $40,000 grant from the Medica Foundation with other funding to build its capacity to meet a significant need for low-cost, culturally sensitive mental health services among its clients. HFC was able to introduce a mental health screening tool into its standard of care, cultivate a network of referral sources and hire a bilingual/ bicultural Latina mental health therapist. By the end of the grant period, HFC had screened more than 100 patients for mental health conditions and was actively providing therapy to more than a dozen people each month at two HFC locations and two area high schools. A recent study found that HFC’s services helped one person per day avoid using the emergency room and one person per week avoid an inpatient stay at each of Rice County’s two hospitals.

Preventing hospital readmissions is a critical strategy to improve the quality of care, reduce health care costs and boost member satisfaction. Hospitals ensure that prescriptions, self-care instructions and plans for follow-up care are in place for all patients when they are discharged. But sometimes these instructions are not enough to prevent a readmission. Co-existing health conditions and a host of other factors put some patients at greater risk of a setback that could land them back in the hospital. That’s why we rolled out a new program in 2018 that uses data analytics to identify hospitalized Medica members who have significant risk factors for readmission. We contact these members within three days of hospital discharge to offer personalized support. Members who opt in receive telephonic outreach from a Medica case management nurse for up to 60 days post-discharge. Together, the member and nurse work on specific issues the member has that are proven readmission triggers. It’s a high-tech-meets-high-touch approach, and it works. In a 15-month study that spanned 2019 and 2020, members who participated in this program had a significantly lower readmission rate than those who did not participate.

As we’ve grown, our community has grown, too. Just take a look at our history.

In Minneapolis, Hennepin County Medical Society launches a nonprofit, open-access health maintenance organization (HMO) called Physicians Health Plan (PHP). We finish the year with 53 members. 1975

PHP merges with a local group-model HMO, Share Health Plan, to form Medica. 1991

Our service area grows to include counties in western Wisconsin. 1998

We expand again, this time to the Dakotas. The Medica Foundation makes its first grants. 2003

We launch our first accountable care organization (ACO) product with M Health Fairview and fast-follow with ACOs featuring premier partners Park Nicollet and Mayo Clinic. 2012

In our 40th year, we kick off a new era of geographic expansion by announcing our entry into Iowa and Nebraska. 2015 We expand into Missouri and Oklahoma. The Medica Foundation enters Nebraska with its community engagement and grant- making activities. 2018

We add Kansas to our service area and open a regional office in Omaha, Nebraska. 2017

Nearly one million members place their trust in Medica. Twenty percent are enrolled in one of the ACO plans we offer in partnership with 14 different health systems. 2019


Medica’s Board of Directors

John Buck *† CEO Whitefish Ventures

2019 was a strong financial year for Medica. That’s good news because as a nonprofit, our earnings don’t go to outside shareholders. Instead, they are invested in the work we do and the communities we serve.

Rajesh Aggarwal, Ph.D. Professor of Finance, D’Amore-McKim School of Business Northeastern University

Combined Balance Sheet (in millions): ASSETS



Brigid Bonner Chief Experience Officer CaringBridge

Cash and Investments



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Total Assets



Peter Kelly, M.D., M.H.A. Vice President & Executive Medical Director of Perioperative Services M Health Fairview Samuel Leon, M.D. * Physician Minnesota Gastroenterology, P.A.




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Total Liabilities and Net Assets



John Naylor President & CEO Medica

Combined Statement of Operation and Changes in Net Assets (in millions): REVENUE 2019 2018 Premiums, Net of Reinsurance $4,532 $4,351 Administrative Service Contract Fees $125 $145 Total Revenue $4,657 $4,497

John Stanoch, J.D. * Retired Judge Hennepin County District Court Earl D. Stratton Retired Executive Vice President & Chief Information Officer TCF Financial Corporation Esther Tomljanovich, J.D. * Retired Associate Justice Minnesota Supreme Court Mary Twinem * Retired Executive Vice President, Chief Financial Officer & Treasurer Buffalo Wild Wings, Inc.




Medical & Other Benefits, Net of Reinsurance



Other Operating Expenses



Total Expenses



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Investment income, income taxes and other non-operating expenses



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* Also a member of the Medica Foundation board † 2019 chair of Medica and Medica Foundation boards

“There is no power for change greater than a community discovering what it cares about.” Meg Wheatley American writer & management consultant

Join our social community! Our neighborhood isn’t complete without you. Just follow @Medica4Me .

© 2020 Medica. Medica ® is a registered service mark of Medica Health Plans. “Medica” refers to the family of health services companies that includes Medica Health Plans, Medica Community Health Plan, Medica Insurance Company, Medica Self- Insured, MMSI, Inc. d/b/a Medica Health Plan Solutions, Medica Health Management, LLC and the Medica Foundation.


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