ELSAN - A winning growth strategy - Leader of the French Acute Care Market with 2 milion patients per year accross 120 facilities
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Jefferies Healthcare Conference 2018
November 14th - 2018
ELSAN – A winning growth strategy
Leader of the French Acute Care Market with
2 milion patients per year accross 120 facilities
Group’s key figures 2
20%
23,000 share of French 60,000
employees private acute care births
market
2,000,000 6,500 120
practitioners Facilities accross all
patients per year
regions in France
A national footprint of more than 100 locations 3
Elsan has grown from 20
hospitals in 2010 to more
than 100 in 2017 through
acquisitons and brownfield
investments
Paris Region
Elsan’s history 4
2001 2010 2014 2015 2017
Acquisition of Acquisition of
CVC
Vitalia Medipole
Entry
(36 facilities) (37 facilities)
# Facilities 2 26 38 81 123
Revenue (€m) - €300m €480m €1,160m €2,110m
Strong track record in acquiring and integrating single facilities as well as larger platformsProviding medical and technological excellence to our patients 5
880 61 47 11
Operating theaters Scanners MRIs Surgical robots
3 10 1
PET Scans Linear accelerators CyberKnife®State of the art facilities 6 Polyclinique de l’Atlantique Hôpital Clinique Claude Bernard Clinique Esquirol St Hilaire Polyclinique Médipôle St Roch Polyclinique de Gentilly Hôpital Prive Oceane Clinique Pôle Sante République Clinique de L’Orangerie
Agenda 7 1. Opportunities offered by the French Acute Care market 2. Investing to drive quality, productivity and outcomes 3. Extending the patient pathway to open new horizons 4. Monetizing know-how through international development
8 Opportunities offered by the French acute care market
French private hospitals market’s features 9 Robust demand (ageing + technology) for acute medical care Freedom of choice for patients between public and private hospital Highly regulated market with strong visibility on authorisations landscape Consolidation underway with still fragmented market. Elsan has unique track record Normalizing tariffs environment
Opportunities offered by the French Acute Care market 10
French Healthcare market reprensents 213 Bn€, of which 78% is funded by the French
statutory public health insurance
24,0 0,6 213,2
78,6 3,2 46,0
(22%)
91%
106,7
167,2
78%
Primary Hospitals Homecare Senior E-Healthcare Total
Care Healthcare
Funded by Private Insurances & patients Funded by French statutory public insurance
Source: ELSANOpportunities offered by the French Acute Care market 11 Very favorable demographic dynamics - Population over 60Y increases 2%p.a.
Opportunities offered by the French Acute Care market 12
Chronicle diseases are contributing significantly to the increase in demand
66% of the French public health insurance total spend is dedicated to chronicle diseases
(c. 15% of population)
# Cases in m
Source: Insee, ATIH, CNAMTS-DSES, -DRESS, Trésor Public, ELSANOpportunities offered by the French Acute Care market 13
Tariff Environment is now under normalization in France offering better visibility for investments
Tariffs Evolution
2015 2016 2017 2018
0.50% 0.50%
0.00% 0.00%
-0.50% -0.50%
-0.20%
-1.00% -1.00%
-1.50% -1.50%
-1.17%
-2.00% -2.00%
-2.50% -2.21% -2.50%
-2.37%
Core Tariffs Evolution Clawback of Government tax benefits
2015 2016 2017 2018
Evolution of prudential reverve Total Tariff Evolution Core Tariffs Evolution -0.76% -1.33% -0.90% -0.50%
Clawback of Government tax benefits -1.50% -0.65% -0.49% 0.30%
Change in Tariffs before prudential -2.26% -1.98% -1.39% -0.20%
Evolution of prudential reverve -0.11% -0.23% 0.23% unknown
Total Tariff Evolution -2.37% -2.21% -1.17% -0.20%Opportunities offered by the French Acute Care market 14
Private hospitals operates 43% of MSO procedures in France
Freedom of choice for patient is a key pillar of
French healthcare system
Private already operates 43% of MSO
procedures in France
Private hospitals provide high quality MSO at
highly efficient cost to Social Security (c.20%
below cost invoiced by public hospitals)
Source: ELSANOpportunities offered by the French Acute Care market 15
High-quality acute care services require complex operational knowledge and heavy
investments, driving to market consolidation
Share of independent amongst private hospitals 1) [% of total number of hospitals]
94%
86%
77%
Independents 71%
63%
51%
44%
49%
Groups
37%
23%
6%
14%
1990 1995 2000 2005 2010 2015 2020
1) Scope: for-profit private clinics with MSO (Medicine, Surgery Obstetrics and Reproductive Health) activities
Source: SAE; ELSANOpportunities offered by the French Acute Care market 16 A market with high barriers to entry securing long term visibility on investments
17 Investing to drive quality, productivity and outcomes
Investing to drive quality, productivity and outcomes 18
A robust growth in demand … but with clear high level
expectations from patients and regulators … - Quality
Outcome measurement Technology and new
and quality of services are norms are now Investment in CRM and
key expectations available to measure knowledge based
quality solutions to measure
and improve client /
payer satisfaction and
They will soon be grow market share
included in the pricing
Payers and patients strategy to define state
want quality at the regulated tarifs
lowest possible costsInvesting to drive quality, productivity and outcomes 19
A robust growth in demand … but with clear high level
expectations from patients and regulators - Productivity
A growing demand
for outpatient / mini- « Average cost per Lean organisations and
invasive surgery procedure is expected operational know-how
to be lower by 20% in to maximize utilisation
outpatient surgery rate , reduce AvLOS,
compared to traditional and improve
inpatient / 3 days productivity
« 70% of surgery will be
AvLOS) surgery »
outpatient / ambulatory by
2022 vs. 54% today » Agnès
Buzyn – French Health Ministry -
Octobre 2017Investing to drive quality, productivity and outcomes 20
The level of expectation is growing …
Key success factors in the following years will be
Medical excellence of practitioners, of course, but also …
A shift towards a more
patient centric
organisation
Fly to quality to benefit
Capacity to design Ability to embed to tech-enabled
build and invest in innovation into operators
efficient medical medical processes,
facilities addressing including digital
needs of new Premium for efficiency
protocols21
Extending the patient
pathway to open new
horizonsExtending the patient pathway to open new horizons 22
Coordination will be key in ensuring efficient patient pathways – digital tools
now becoming the obvious answer
Roche/CSA study – Jan 2018 : How French consumers expect healthcare to be in 2045 ?
In 2045, the patient will …
General
Consult his Be active in his own diagnosis Be active in on-line communities
Practictioner via tele consultation through apps and softwares of patients
81% 78% 70%Extending the patient pathway to open new horizons 23
A very wide spectrum of services can be integrated into the patient pathway..
B2B2C B2C
Prevention Acute Post-Acute & Follow-up Well being
Télémédecine Patient Personalised Programs Mobile Apps
to encourage
Organisation of Rehab / therapeutical education
positive
patient access Observance behaviours
to the right Follow-up / risk detection
specialist
Planning Télémonitoring IoT for self-
support monitoring
Second Homecare services
opinions
Most of them require patient access and medical ressources to ensure
effectiveness
Source: Technavio, Xerfi, Entretiens, Roland BergerExtending the patient pathway to open new horizons 24
E-Health market is still fragmented but acute care operators can offer unique market
access and can help to adress many existing hurdles
Regulatory framework no mature yet Difficult market access
>Telemedecine defined since 2010 in France >Autorisations
>Experimental phase since 2014 (250 projects) >Capex
>New framework to come as from 2019 >Access to patients
Business Model yet uncertain E-Health Lack of technological standards
Non-mature
>Reimbursement issues market yet >Hospital IT connectivity is a
challenge
>Patient willing to pay ?
Wide spectrum of initiatives Model needs to be integrated
> Personalised medical and non
>Mostly start-up phase initiatives
medical services, logistics, …
Source: Interviews, Roland BergerExtending the patient pathway to open new horizons 25
E-Health / Tech-enabled healthcare market is of strategic importance to many
stakeholders
Hospital operators are
key to offer market
access for E-Health
initiatives
Elsan is partnering (and
is willing to invest)
with technology
providers to unlock
roll-out of technology
Direct stakeholders
Indirect stakeholders26
Monetizing know-how
through international
developmentMonetizing know-how through international development 27
Elsan currently expands through an international development initiative, mostly focusing
on emerging markets / markets requiring upgrade in their medical infrastructure
1 2
Design & Proven experience in
Construction of Management of hospitals
Our long lasting Hospitals
technical know how (including third party 2 hospitals opened
and operational owned) in Africa (Morocco)
culture are key in 2018 and more
assets to succeed in 3 4 to come …
challenging
projects A specific approach of
Academic excellence
local needs to develop
and attractiveness
tailored medical
of French Médecine
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