2016 Election

Impact on business, jobs and lives

Problems and Solutions

US & Intl Economic Situation

2016 Presidential Race

Future Growth

Medical Devices: Tinkerers are now using things like 3-D printers to make artificial hands for children; clothing that will monitor health in real time; and

incredibly cheap genetic tests that indicate what’s going wrong now, what is likely to go wrong in the near future and how to avoid the latter. But, again,

virtually every single invention – or even slight modifications to improve those inventions – has to

go through the maze of regulatory approval and spend thousands of dollars supporting the “mother

may I” rules of the FDA. Richard Williams Mercatus Center

US Dollar +25%

3yr Oil and Nat Gas

Rate Dilemma

“There are limits to what monetary policy can and, indeed, should, do. The burden

must also fall on fiscal and other policies to do their part to help create conditions

conducive to economic stability.”

SF Fed President John Williams

Productivity=Growth

Policy solutions for growth

Free Trade=lower tariffs

Reg. Relief=reduced costs

Tax reform=capital formation w/incentives

Infrastructure=efficiency

Energy Production

The 10yr Debt Time Bomb

Trump Econ/Tax PlanCut Corp& Pass thru

to 15%Carried interest as

ordinary1x 10% Repat Tax

Ag TPP and NAFTAImpose tariffs on imported goods

Big Drop in InterestDeductibility

New $500B infrastructure Full expensing!

100 Day Reg & Energy Plan

Energy Platform:Save coal industry,

Pass Keystone, Lift moratorium for energy on

Fed landsCancel Paris Climate Agreement

Rescind and Reform: Obama executive actions,

Climate Action Plan, WOTUS,

Obamacare, Dodd-Frank

Trump HC Plan

Allow health insurance to cross state linesFull individual deduction of HC premiums

Repeal Obamacare: no individual mandate,Repeal of medical device tax

HSA: tax free and allowed to accumulatePrice Transparency

Medicaid Block GrantsAllow access to imported drugs

Trump HC Contradictions

2/18 “I like the mandate.”

3/1: Repeal mandate and ACA

Repeal Obamacare: no individual mandate

Feb. CNN: he wants to “take care of” poor people “through maybe concepts

of Medicare”

Next day, tweets his proposal would use “private plans”

Trump plans help/hurt

Help: big tech & big pharma

Hurt: debt heavy balance sheets

Help: industrials & manufacturers

Hurt: free trade

Hurt: ACA managed care, hospitals, Medicaid HMOs

Help: Medical Device industry

The Good and the Bad

Source: Tax Foundation

CLINTON PLAN

Fair share C tax

No Free Trade

Exit Tax

$275B Infrastructure plan

Extend/expand Obama regulation

programs

Big Change to Cap Gains

Fin Reg & Energy Plan

500mln solar panels by 2021Implement Clean Power Plan &

Paris Agreements$60B Clean energy challenge

Risk fee on the largest financial institutionsNo hedge fund investing

Hold senior bankers accountable for lossesNo financial firm is ever too big or too risky

HFT tax, close carried interest

Clinton HC PlanDefend the Affordable Care Act

Crack down on rising prescription drug prices

100% 3yr match for states joining expanded Medicaid coverage

$5,000 tax credit per family for excessive out-of-pocket and premium costs above 5% of their income.

Transform HC to reward value and qualityvia bundled payments and ACOs

Clinton’s Comments“We have to go after price gougingand monopolistic practices and get

Medicare the authority to negotiate.”

“…I’ll defend ACA, build on its successes,and go further to reduce costs.”

“What we have to do, I think, is defend ACA and fix it.”

“I will direct the government to reevaluateMedicare and Medicaid payment practices to remove

obstacles to reimbursement and helpintegrate care for addictions into standard practice.”

Clinton plans help/hurt

Hurt: MNCs competitiveness

Hurt: raises taxes on top earners/capital formation

Help:ACA managed care,hospitals, Medicaid HMOs

Help: energy/alternativesHurt: energy/hydrocarbon production

Hurt: banking

Good, Bad and Complicated

Source: Tax Foundation

2016 RecapClinton:

biz tax hikesBuild ACA

Public option build on regscap gains taxno free trade

big alternativesbig infra

create pathway

Trump: biz tax cuts

Cut ACAMedicaid block

reduce regs cap gains cutno free trade

big hydro carbon big infra

build a wall

2016 HC Similarity Recap

Increased price transparency

Allow Medicare to negotiatedrug prices directly with pharma

Source: PIIE

Major LP Issues

Regulatory overload

Politics/Election fat tail

Slow growth & low rates

Policy solution summary

Future Growth Solutions

Artificial intelligence

PMI

Chronic Care

“…we have seen how the great acceleration is being driven forward by a powerful alliance between hardware and

software – between technology and ideology. Day by day, year by year, this

process is reaching further into our lives, as the billionaires and would-be billionaires

of Silicon Valley widen their ambitions. Space travel, education, energy,

agriculture, transportation – all these sectors and more are in their sights. In

their quest to disrupt the world, they and their cousins around the world are aided

and abetted by the availability of raw computing power on a scale unimaginable

a few decades ago. Robert Colvile in “The Great Acceleration: How the World is Getting Faster, Faster”

Chronic Care Focus

CMS recognizes care management as one of the critical components of primary care that contributes to better health and care for individuals, as well as

reduced spending. BeginningJanuary 1, 2015 Medicare pays separately under the

Physician Fee Schedule (PFS) under American Medical Association Current Procedural Terminology

(CPT) code 99490, for non-face-to-face carecoordination services furnished to Medicare

beneficiaries with multiple chronic conditions.

Pressure on PriceOver the period from 2005 to 2014, premiums for employment-based insurance grew by 48 percent for single coverage and by 55 percent for family coverage. CBO and JCT expect them to grow at similar rates over the next decade—by about 5

percent per year, on average, or about 2 percentage points faster than income per capita. As a result of that growth, average premiums for employment-

based coverage are projected to be about $10,000 for single coverage and about $24,500 for family coverage in 2025, nearly 60 percent higher than

they were in 2016.CBO Feb 2016

HC Pricing TransparencyCastlight: mission is to empower people to make

the best choices for their health, and help companies make the most of their health benefits.

MD Insider: we analyze doctor performanceusing big data

Guroo: At guroo.com, you'll find data on health care costs and quality. We have national, state,

and local prices.

Strata Decision: Our passion and our mission is to help hospitals and health systems drive margin to fuel their mission.

Precision Medicine Initiative

Final Thoughts…