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-Joint release For Immediate Release March 25, 2013 Contact: Mary Wallan (617) 509-2419 mary_wallan@hphc.

.org Rob Graham (617) 919-3111

Harvard Pilgrim Health Care and Boston Childrens Hospital Agree on Contract Keeps Cost Increases Below Inflation and Focuses on Improving Quality Wellesley/Boston, MA Harvard Pilgrim Health Care and Boston Childrens Hospital announced today that they have reached an agreement that limits cost increases to below inflation, provides incentives for patients to get care at Boston Childrens lower-cost outpatient satellites in Peabody, Waltham and Lexington and continues to improve quality based on pediatric quality metrics. We worked closely with Boston Childrens Hospital on an innovative arrangement that will provide quality and value to consumers and employers and at the same time acknowledges the complexity of care required by a substantial portion of Boston Childrens patients, said Eric Schultz, Harvard Pilgrim president and CEO. We want to support Boston Childrens care of patients in the most appropriate setting for the patients needs whether at home, in the community, or at the hospital itself. This is a win-win agreement for patients, employers and Boston Childrens. In addition to limiting health insurance rate increases below inflation, the contract supports innovative new ways to deliver care, including a continued focus on medical homes, programs that move services from inpatient settings to less costly outpatient locations, and telehealth services. In addition, Harvard Pilgrim and Boston Childrens are working together to develop bundled pricing for more routine services. We appreciate Harvard Pilgrims willingness to engage with us as we work to slow the growth of health care costs and deliver high-quality care in more efficient ways to benefit patients and families, said Sandra Fenwick, Boston Childrens President and COO. The contract strengthens our Community of Care by further investing in our efforts to improve care coordination with primary care physicians through medical homes and by supporting family-centered innovations in care ranging from home visiting to day treatment for conditions previously treated in the inpatient setting. Patients and families will benefit through lower costs and greater convenience to our high quality care.

About Harvard Pilgrim Health Care Harvard Pilgrim Health Care is a not-for-profit health plan serving more than one million members in New England. Founded in 1969, the health plan has built its reputation on pragmatic innovation with a goal of lowering costs, improving care and enhancing the overall member experience. Harvard Pilgrim is known for its

excellent clinical programs, customer service, health improvement strategies and innovative tools that offer consumers greater transparency and empower them to make better decisions about their health care. Harvard Pilgrim is the #1 private health plan in America again according to an annual ranking of the nations best health plans by the National Committee for Quality Assurance (NCQA). Harvard Pilgrim is the only private health plan in the nation to be named #1 for member satisfaction and quality of care for nine consecutive years.* * NCQAs Private Health Insurance Plan Rankings, 2011-13, HMO/POS. NCQAs Health Insurance Plan Rankings 2010-11
Private. U.S.News/NCQA Americas Best Health Insurance Plans 2005-2009 (annual). Americas Best Health Insurance Plans is a trademark of U.S.News & World Report. NCQA The State of Health Care Quality 2004. Harvard Pilgrim Health Care of New England, Harvard Pilgrims New Hampshire affiliate, is the top-ranked plan in New Hampshire and the seventh highestranked private health plan in America.

About Boston Childrens Hospital Boston Childrens Hospital is home to the worlds largest research enterprise based at a pediatric medical center, where its discoveries have benefited both children and adults since 1869. More than 1,100 scientists, including nine members of the National Academy of Sciences, 11 members of the Institute of Medicine and 11 members of the Howard Hughes Medical Institute comprise Boston Childrens research community. Founded as a 20-bed hospital for children, Boston Childrens today is a 395-bed comprehensive center for pediatric and adolescent health care grounded in the values of excellence in patient care and sensitivity to the complex needs and diversity of children and families. Boston Childrens also is a teaching affiliate of Harvard Medical School. For more information about research and clinical innovation at Boston Childrens, visit: ###