2001

BUFFALO, N.Y., November 28, 2001 - Western New York's largest health system, Kaleida Health, and the area's largest HMO, Independent Health, have announced the signing of a two-year agreement that will take effect Jan. 1, 2002 and run through Dec. 31, 2003.

The agreement provides continued access for all Independent Health's members to the services and programs of Kaleida including its five hospitals: Buffalo General; The Children's Hospital of Buffalo; DeGraff Memorial Hospital, North Tonawanda; Millard Fillmore Gates Circle Hospital, Buffalo, and Millard Fillmore Suburban Hospital, Amherst. The agreement covers all Independent Health's lines of business, including its commercial HMO, Medicare, Medicaid and self funded plans.

The contract provides the necessary increased reimbursements to Kaleida in order to continue the health system's advancements in developing and enhancing quality care and services. The new agreement builds upon our current relationship and shared understanding of the health care delivery processes and advances our future efforts to redesign and reshape the delivery of high quality and efficient care, explained Frank Colantuono, president and CEO, Independent Health, and Carrie B. Frank, executive vice president and chief operating officer, Kaleida Health.

"We realize there is a cost to change and redesign, and this contract reflects this investment, as well as an understanding and expectation of Kaleida Health's commitment to a provide a return on investment by improving health care in Western New York," said Colantuono.

"We are very pleased with the contract. It illustrates Independent Health's commitment to support Kaleida in maintaining and enhancing the services we provide for our patients," noted Frank.

The agreement supports Kaleida's commitment to advance the quality of and access to care provided to the Western New York community, including the following care initiatives and quality measures:

• Reducing medication errors. The agreement supports enhancing patient safety measures through better medication administration and improved patient identification systems, expanded computer order entry systems, robotic dispensing of medications, and an expanded use of web-based drug information for patient and caregiver education.
• Supporting such technological improvements as the latest in diagnostic imaging technology, cardiac diagnostic equipment, and therapeutic labs that will provide timely access to services, safer, more accurate diagnostic testing and improvements in efficiency.
• Advancing on hospital improvement and renovations projects that include construction of a new neonatal intensive care unit and revitalization of the emergency department at Children's Hospital.
• A commitment by Kaleida to patients and employers to measure and improve patient satisfaction. Kaleida will continue to seek feedback from all inpatients on a regular basis and participate in periodic community-wide surveys to determine patient satisfaction levels and identify areas for improvement.
• Kaleida, Independent Health and its participating physicians will work collaboratively to focus on several initiatives - such as prevention and management of cardiac disease, early intervention and management of stroke, and asthma management - to improve the care provided and overall quality of life for patients with these conditions.

"Independent Health is clearly dedicated to supporting Kaleida's investment in the future of health care in Western New York. They have demonstrated this commitment through the terms of this contract, which will help us greatly in efforts to recruit and retain specialists, invest in technology and facility improvements, and offset the rising cost of pharmaceuticals. The new contract represents a 'win-win' partnership for our physicians, our hospitals, our community and most importantly, our patients," Frank said.

"With the numerous challenges facing health care today, including skyrocketing pharmaceutical costs, an aging population requiring more medical services, and a shrinking health care workforce, it is imperative that health plans, health systems and physicians work cooperatively in order to overcome these challenges while still improving patient care. This contract reflects our commitment to work collaboratively with Kaleida and the physician community to bring about these improvements," added Colantuono.

Kaleida Health is Western New York's largest health care system, formed in 1998 with the merger of Buffalo General Health System, The Children's Hospital of Buffalo, Millard Fillmore Health System and DeGraff Memorial Hospital. Kaleida encompasses five hospitals, more than 1,800 physicians, close to 1,800 acute care beds, 550 long term care beds, more than 60 service locations and the largest and most comprehensive home care organization in the region. The system provides approximately one-third of all health care services to adults and children in Western New York. To learn more about Kaleida Health, visit www.kaleidahealth.org.

Headquartered in Buffalo, Independent Health began operations in 1980. In addition to the original HMO, the health coverage company has expanded its managed care offerings to include a point-of-service product and coverage for self-funded employers, Medicare and Medicaid managed care plans as well as a new PPO product beginning January 2002. The company has a combined membership of nearly 380,000. For more information, visit Independent Health's website at www.independenthealth.com.