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4/11/2017 1 Building a Healthier Community Through Wellness and Employer Partnerships $3.7B in revenue 1.1M patient encounters 221K managed lives 9 hospitals More than 475 primary care physicians and 1,250 specialists St. Joseph Hoag Health We are the trusted partner transforming care to create healthiest communities.

115 St. Joseph - Afable - SJHH WD HASC Presentation ...2 For the LTM, Toshiba revenue converted to USD at an average exchange rate of 111.78 JPY/USD; Samsung and SK Hynix revenue converted

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Page 1: 115 St. Joseph - Afable - SJHH WD HASC Presentation ...2 For the LTM, Toshiba revenue converted to USD at an average exchange rate of 111.78 JPY/USD; Samsung and SK Hynix revenue converted

4/11/2017

1

Together Makes All The DifferencePartnering to bring personalized health and wellness to the workplace

Building a Healthier Community Through Wellness and Employer Partnerships

• $3.7B in revenue• 1.1M patient encounters• 221K managed lives• 9 hospitals• More than 475 primary care physicians and 1,250 specialists

St. Joseph Hoag HealthWe are the trusted partner transforming care to 

create healthiest communities.

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2

Employer

SJHH Payor

Employer

Broker

CURRENT

Consumer

FUTURE

Consumer

Partnering with Employers and Building a Healthier Community Through the SJHH Wellness Strategy 

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3

The Hypothesis

Healthier Workforce

Medical

Wellness

Fitness

Improved Cost of Care

Convenient, Integrated & Personalized

To become our community’s partnerin achieving optimal health by providing integrated 

medical, wellness and fitness services where people live, work and play.

Wellness Corners(Retail Wellness Centers)

Direct to EmployerWellness Centers

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4

WELLNESS CORNER

Chris

Park Place(Irvine)

The Village(Irvine)

Park Plaza(Irvine)

Newport Center

(Newport)

AnaheimPromenade

Retail wellness centers serving small to mid‐size employers in multi‐tenant office communities

• Medical care for minor illnesses, minor injuries, chronic conditions

• Lifestyle coaching—exercise, nutrition, sleep & stress

• Lifestyle labs—cardiometabolic, micronutrient & genetic

• Direct to employer services: lunch & learns, skin care events, biometrics and flu shots

WELLNESS CORNER OUTCOMES

4,000 unique customers 

1,000 new members to the network

Improved Productivity

Reduced Absenteeism

97% satisfaction rating 

Health Improvement

• 5% increase in percentage of employees rated low‐risk 

• 4% decrease in employees rated moderate risk

• 1% decrease in employees rated high risk

11 employer partnerships where services are brought onsite

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5

DIRECT‐TO‐EMPLOYER WELLNESS CENTERS

Opened July 2015

• Wellness centers serving a single employer

• Designed to meet an employers’ workforce health needs, as well as further their 

wellness and medical benefit goals.

• Operate as an onsite accountable care model

• Four employer partnerships in Orange County 

Business Overview

February 2017

©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential.

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Western Digital

• In a strong strategic position to lead global evolution of broad-based and changing storage industry

• Broad storage portfolio, including HDDs, SSDs, embedded and removable flash memory, and storage-related systems

• 17,000+ active patents worldwide

• Vertically integrated business model to maximize operational efficiency

• Consistent profitable performance, strong free cash flow

A Storage Solutions Leader

11

©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential.

Our 9 largest sites EMEA

AustriaBelgiumCzech RepublicDenmarkEgyptFranceGermanyIrelandItalyNetherlandsPolandRussiaSaudi ArabiaSouth AfricaSpainSwedenSwitzerlandTurkeyUAEUKUkraine

Americas

ArgentinaBrazilCanada

APAC

AustraliaHong KongIndonesiaSouth KoreaTaiwanVietnam

SitesHeadcount:WD, HGST,

SD

China 10,718India 976Israel 648Japan 2,008Malaysia 14,332Philippines 8,515Singapore 707Thailand 25,590US 8,204All Other 795Total Headcount 72,493

Where Western Digital is in the World

Presence in 31 additional countries

+

©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential.

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13

The Power of We.

©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential.

Innovation Fuels Our Growth

14

1976 | WDFirst Disk Array Sub-System Patent

1956 | IBMInvented First Hard Drive (RAMAC)

1991 | IBM MR Heads

2000 | SanDiskFirst MLC NAND

2010 | HGSTSAS SSD

2008 | SanDisk16Gb TLC

2013 | HGSTFirst Helium

HDD (6TB)

2014 | WDFirst WD Purple

HDDs for Video Surveillance

2015 | SanDiskBiCS2 256Gb X3 48-layer

2016 | SanDiskBiCS3 256Gb X3 64-layer

2015 | HGSTActive Archive System

4.7PB Object Storage System

2015 | SanDiskInfiniFlash™ All-flash Array

1988 | SunDiskFirst System Flash

©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential.

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Broadest Portfolio of Products & Solutions

15©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential.

Client Devices

Client Solutions

Data Center Devices & Solutions

Delivering the Possibilities of Data

City Medical Industrial Autonomous Vehicles

Machine Learning MobileHome

©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential. 16

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Industry’s Largest Storage Solutions CompanyLTM Revenue1

17©2017 Western Digital Corporation or its affiliates. All rights reserved. Confidential.

Source: Company website; Public filings; analyst reports; S&P Capital IQ1 Last 4 quarters ending Sep 30, 2016 for WDC, Seagate, Toshiba, Samsung, Micron and SK Hynix; ending Oct 1, 2016 for Intel; ending Oct 28, 2016 for NetApp; and ending Jun 30, 2016 for EMC

2 For the LTM, Toshiba revenue converted to USD at an average exchange rate of 111.78 JPY/USD; Samsung and SK Hynix revenue converted to USD at an average exchange rate of 1160.00 KRW/USD

3 Includes Non-Volatile Memory (Trade and Non-Trade) and Other

Non-Volatile Memory

NAND 2 Storage and Memory 2

Pro-formaIncluding SanDisk

NAND2Non-Volatile Memory 3

InformationStorage

$17.7B$15.9B

$11.7B $11.1B $11.0B

$5.4B $5.2B$3.4B $2.4B

DRIVE WELLNESS STRATEGY

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Key Drivers ofClaims CostIncrease in large claims 2013/14: 10 large

claimants/1,000 2015/16: 14 large

claimants/1,000

Shift of enrollment to Northern California 2010/11 – 57% (WD) 2012/13 - 66% (HGST) 2016/17 – 75% (SanDisk) Northern California providers are

on average 15-20% higher than Southern California

Increase in specialty rx ingredient cost per script 2013/14: $1,795 2015/16: $2,590 (+44%)

Periodic reduction in force activities impacts overall utilization of plan and PEPY

PEPY – per employee per year

$61M

Cost Management

19

Employee Annual Contribution below $2,250 between 2011 - 2017

PEPY – per employee per year

Drive 1.0 - Renewal Assumes the following annual change for employees enrolled:

• Anthem BC: +5.9%

• Kaiser: +10%

Drive 2.0 - RenewalAssumes the following annual change for employees enrolled:

• Anthem BC: +0%

• Kaiser: +10%

EE Annual Contribution

20

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11

$39.5MTotal WDC funding of H.S.A funds and incentives since 2011

FYI: Feb 17 Total Assets @ $30.8 M

PEPY – per employee per year

$33.6 M85%

$5.9 M15%

H.S.A Funding

Incentives

Drive services to on-site clinics Increase engagement by proactive

activities Manage EE/SP costs

H.S.A Seed + Rewards

Significant change for employees

Change in how WDC spends budget

Impact on clinic and facilities

21

$4,3702016/17 YTD averageH.S.A balance (data reflects addition of SanDisk)

FYI: Highest balance: $57k

26%Of employees have an account balance in excess of $5,500 as of Feb 2017

PEPY – per employee per year

52%Of employees can meet their deductibles based on current balances

H.S.A EE Balances

2016/17 average WDC H.S.A Seed amount = $1,080

2016 H.S.A IRS contribution limit: $3,350 / $6,750 | 2017: $3,400 / $6,750

On average, H.S.A Contribution split: WDC: 40% ($1,080) --- Employee: 60% ($1,620)

22

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12

Make it Happen

DRIVE

Tier 1 and 2 large claimants and associated chronic conditions have a large impact on costs. Recommendation to modify current engagement program.

20%

37%33%

2%20%

30% 30%

9%

40%45%

50%

20%

0%

10%

20%

30%

40%

50%

60%

Closed Gapsin Care

PrenatalProgram

ConditionMgmt

Case Mgmt

2014/15 2015/16 Target

Health Consumer Profiles impacting costs97% of total costs are incurred by 30% of the WDC population

Tier 3Managing Health

70%Members = 10,331

Plan Paid (Avg) $166 PMPY

Total Plan Paid $1.7M | 3%

Tier 2 Managing Care

Tier 1ManagingCrisis

29%Members = 4,279

Plan Paid (Avg) $6,820 PMPY

Total Plan Paid $29.2M | 53%

1%Members = 148 (Spouses: 56 or 40%)

Plan Paid (Avg) $160,551 PMPY

Total Plan Paid $23.8M | 44%

Problem Space

Driving to target engagement from Tier 1 and Tier 2 members

Data below is based on Anthem BC claims only

23

Think Big

Make it Happen

DRIVE$4,188

$5,535$4,875

$6,227$5,357

$6,725

$4,899

$6,258

$1,000$2,000$3,000$4,000$5,000$6,000$7,000

Employee Spouse

2015/16 2016/17

52%

41%

62%

22% 21%

36%

0%

10%

20%

30%

40%

50%

60%

70%

BiometricsScreenings

HealthAssessments

Mobile Health

Employee Spouse

Spouses on average cost 32% higher than employees and account for 36% of high cost claimants

Targeting spousal engagement to increase to similar or higher levels as employee.

Anthem Enrollment (Feb 17) = 15,735 members (38% EE | 24% SP | 38% CH)

Kaiser Enrollment (Feb 17) = 3,428 members (41% EE | 23% SP | 36% CH)

PMPY

Problem Space

Improved risk and cost management requires higher engagement from spouses

24

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Solution Considerations

25

$80.00

$85.00

$90.00

$95.00

$100.00

2016/17Drive 1.0

2017/18Drive 1.0

2017/18Drive 1.5

2017/18Drive 2.0

Mill

ions

Savings$2.60 M

Savings$5.21 M

Target EngagementTarget Engagement

90 – 100%50%

+ 5.9%

+ 3.0%

+ 0.04%

Achieving Western Digital’s Goals with 

DRIVE Wellness  Center

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4,600 sq. ft. 

• Primary Care

• Acupuncture

• Behavioral Health

• Mindfulness

• Yoga

• Chiropractic Care

• Physical Therapy

• Health Coaching

• Onsite Medication Dispensing

Added in September: 

• Care Management

• Disease Management

Physical Therapy

Exam

ENGAGEMENT & VISITS

Visit VolumesFY16

Annualized VisitsFY17 YTD 

Actual Visits Through January

Engagement 50% 65%

Primary Care 1,559 905

Physical Therapy 294 162

Chiropractor 496 220

Acupuncture 148 174

Behavioral Health 635 297

Body Composition 207 80

Health Coaching 106 50

Nurse 931 559

Total 4,376 2,414

50% of employees engaged in year 1 and 65% in year 2. 

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15

Patient Satisfaction

40%

Same‐Day Appointments

20%

Implementation Success20%

Employee Engagement

20%

Year 1 Incentive Goal Weightings

Implementation Success

30 days

Employee Engagement 46%

Same Day Appointments

100%

98.00%70% ‐79.99% 80% ‐ 89.99% 90% ‐ 100%

Threshold Target Exceptional

85% ‐ 89.99% 90% ‐ 93.99% 94% ‐ 100%

Threshold Target Exceptional

30%450 employees

35%525 employees

40%600 employees

Threshold Target Exceptional

31 days 29‐30  days 28 days

Threshold Target Exceptional

Patient Satisfaction

(Total year to date unique visits at DRIVE  (general utilization) measured as a percentage of WD's 1,500 employees)

PAY FOR PERFORMANCE INCENTIVES

Chris

WD’S COST SAVINGS

Operating Performance (Surplus)Year 1 Annualized Actuals(Based on June actuals)

Revenue (Employee Contributions) ($64,511)  

Staffing $584,190 

Non‐Staffing Operating Expenses $76,211 

Management Fee and Performance Incentives $406,400 

Total Expenses $1,066,802 

Net Expense (Surplus) $1,002,291 

Estimated Productivity Savings* ($749,850)

Market Costs Avoided ($725,139)

Pharmacy Savings ($24,380)

Savings from Avoided ED/Urgent Care Visits** ($136,620)

Net ROI (Surplus) ($633,698)

*3 hours for visits and 1 hour for prescriptions. **2013 blended average emergency department and urgent care costs of $688 plus a 5% increase for 2014 and another 5% increase for 2015. 

$634K savings in year 1. 

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QUESTIONS & DISCUSSION