Relentless Health Value

The 401-Level Financial Motive Behind Prior Auths and Pharma Rebate Contracting Imagine a cheaper, generic, or even clinically better drug that somehow ends up not on formulary at all, or stuck behind step edits and prior authorizations with a higher copay than the pricier brand sitting right next to it. In this solo episode, host Stacey Richter breaks down exactly how that happens, walking through a case study she calls Brand Number 2 versus the formulary's reigning Brand Darling to show how PBM and GPO rebate economics, not clinical need, often decide which drugs patients can access easily and which ones get thrown up against a wall of red tape. This is Episode 517 (EP517) of Relentless Health Value. WHAT YOU'LL LEARN ✅ How a high-volume Brand Darling generating billions in sales and huge aggregate rebates can keep a cheaper, generic, or more effective Brand Number 2 stuck on a nonpreferred tier, behind step edits and prior authorizations, regardless of price or efficacy ✅ Why a structural rebate cliff makes it nearly impossible for a new entrant to unseat an established Brand Darling on formulary, even if that new entrant offers a 99 percent rebate ✅ How rebate dollars a PBM or GPO wants to keep can be relabeled as a data fee, a service fee, or an admin fee, a dynamic also flagged by benefits consultant Robyn Tikia, letting a PBM still claim it passes along 100 percent of rebates ✅ Why a prior authorization is often used as a financial negotiating lever against a manufacturer's rebate offer rather than a clinical determination of whether a patient needs the drug ✅ How regulation such as the Inflation Reduction Act is compressing list prices and collapsing the rebate spread that the traditional contracting math depends on ✅ How GoodRx runs a reverse auction among PBMs to surface its advertised cash price, making coupon sites effectively a sales channel for the same PBMs that lock manufacturers into exclusive formulary contracts WHY THIS MATTERS As Stacey Richter lays it out, a PBM with a fiduciary duty to its shareholders has every financial incentive to double down on a high-volume Brand Darling and freeze out a cheaper or better Brand Number 2 with step edits and prior auths, whether or not that serves the patient stuck in the middle. As regulation compresses list prices and rebate spreads get less stable, more pharma manufacturers are deciding it is worth giving up access to large blocks of insured lives in order to control their own price directly through cash pay, patient assistance programs, or their own copay cards. It is not a clean alternative, since cash pay still runs through PBM-linked coupon platforms like GoodRx, but for some brands it is starting to look like the more controllable bet. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP517 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 📺 Subscribe to our YouTube channel: https://www.youtube.com/@RelentlessHealthValue 🎤 Listen on Apple Podcasts: https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify: https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b === CONNECT WITH THE RHV TEAM === ✭ LinkedIn: https://www.linkedin.com/company/relentless-health-value/ ✭ Threads: https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky: https://bsky.app/profile/relentleshealth.bsky.social ✭ X: https://twitter.com/relentleshealth/ 00:00 Introduction to this episode. 00:35 EP516 with Ophelia Johnson. 01:48 A brief summary of the topics covered in this episode. 03:53 What needs to be true, no matter what your pharma brand is. 04:20 Why a PBM picks a brand "darling." 05:10 A message to PBM sales teams. 09:43 Clarifying a point about formulary decision making. 14:34 When might a cash-pay strategy start to look rational for a pharma brand? 16:25 Cash pay versus formulary from the patient perspective. 19:50 How PBMs feel about brands going cash pay. 20:56 Why GoodRx is allowed to sell non-formulary Rxs at cash prices on PBMs. 22:59 AEE13 with Ge Bai, PhD, CPA. 23:51 A clarification of points on GoodRx. 26:19 A point to ponder about discount coupons.

Is it fraud — or is it just a perverse incentive? That question sits at the center of Hunterbrook Media's latest investigation into skilled nursing facilities (SNFs), and the answer, as Stacey Richter puts it, matters to self-insured employers and anyone else paying for healthcare. In this episode, Stacey speaks with Michelle Cera, PhD, investigative reporter at Hunterbrook Media, whose investigation — triggered by a tip from an overwhelmed elder abuse attorney — uncovered a pattern of systematic understaffing, self-reported CMS STAR rating manipulation, executive bonuses tied to expense-cutting, and related-party financial engineering that funnels Medicare and Medicaid dollars straight back to corporate, while the most vulnerable patients pay with their health and their lives. WHAT YOU'LL LEARN ✅ How for-profit SNF chains systematically recruit the sickest patients to maximize Medicare and Medicaid reimbursement, then staff below what those patients actually need — keeping the difference as profit and, in some cases, doubling executive bonuses in a single year ✅ How Hunterbrook analyzed millions of publicly available CMS data points across roughly 14,000 skilled nursing facilities, applying a UCSF-developed expected-hours formula tied to patient acuity, to quantify the gap between staffing hours billed and care hours actually provided ✅ Why CMS STAR ratings — the primary tool consumers use to choose nursing homes for loved ones — are largely informed by self-reported, unaudited facility data, and how former employees described manipulation of those ratings as rampant ✅ How related-party transactions allow SNF chains to route Medicare and Medicaid dollars through owned subsidiaries for goods and services like pharmacy, equipment, and insurance — with CMS flagging the overcharges as disallowed costs but lacking any mechanism to recoup them ✅ How a 2024 CMS final rule establishing a federal minimum of 3.48 HPRD (hours per resident day) and a 24/7 on-site registered nurse requirement was ultimately rescinded after industry lobbying — and what that rescission reveals about regulatory capture in the SNF sector ✅ Four concrete policy fixes: codify federal minimum staffing hours adjusted for patient acuity, strengthen reporting standards and auditing so no quality metric is entirely self-reported, create a recoupment mechanism for flagged related-party overcharges, and reform STAR ratings so consumers can distinguish independently verified data from self-reported data WHY THIS MATTERS Right now, Stacey argues, we are endlessly trying to keep up with thousands of profit-extracting geniuses and creating mazes of complexity to regulate actors who have no societal construct keeping them in check. The SNF sector is a case study in what happens when there is no agreed-upon definition of harm — when perverse incentives are just incentives. These are taxpayer, employer, and patient co-insurance dollars potentially going into someone's pocket while a patient is simultaneously being hurt. The 65-plus population is growing, the market is expanding, and — as Hunterbrook's research shows — the model that works from a profit perspective is to take sicker patients, cut the highest-paid staff first, and grade your own homework so no one notices. That playbook, once proven, spreads fast. === LINKS === 🔗 Show Notes with all mentioned links and link to the Hunterbrook article: https://cc-lnk.com/EP515 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 Introduction to this episode. 00:40 Fixing the root cause problems with the American healthcare system. 01:40 EP511 with Dr. Siva and Monica Lypson, MD, MHPE. 01:50 Today's root problem topic. 05:12 Introducing today's guest and her latest investigation. 07:43 The conversation with Michelle Cera, PhD. 08:35 How Hunterbrook Media's latest investigation into skilled nursing facilities got started. 11:07 EP509 with Patrick Nelli. 12:58 Article where you can learn more about Hunterbrook Media's investigation and the stories of neglect. 13:20 How inadequate staffing creates neglect in SNFs. 14:03 Connecting the dots between staffing and resident needs. 15:33 Why skilled nursing facility chains are extremely profitable to the detriment of patients. 17:15 How star ratings on CMS can be skewed in the favor of these SNF chains. 21:56 The perverse incentives playbook. 23:20 An example of how executive bonuses are tied to perverse incentives. 27:53 How lobbying walked back the CMS minimum staffing regulation for SNFs. 29:05 Another note in the perverse incentives playbook. 30:08 University of Pennsylvania study on minimum staffing levels. 30:59 How much of these chain SNFs' funding is from taxpayer dollars. 33:16 Another perverse incentive: overpaying sister companies. 34:17 EP482 with Preston Alexander. 35:07 Why CMS can flag overcharging, but they don't have a cost recoup structure. 38:10 The case to be made about how current business dealings within SNFs is fraudulent. 39:30 How to fix the perverse incentives happening in skilled nursing facilities.

Stacey Richter introduces Episode 513 of Relentless Health Value as a primer on anti-competitive hospital contracting with Brennan Bilberry of Fairmark Partners, setting up next week's interview with Matt Cantor, lead litigator in the Sutter Health antitrust class action that led to a $575 million settlement over alleged price inflation using market power. Bilberry explains how hospital consolidation enables higher commercial rates and outlines a four-part contracting playbook: all-or-nothing contracting requiring inclusion of all system facilities at high prices; anti-steering and anti-tiering clauses blocking lower-cost benefit designs; price gag clauses limiting disclosure of negotiated rates despite transparency rules; and pressure on ostensibly independent providers to sell or align pricing with the dominant system. The episode links these patterns to DOJ actions against OhioHealth and New York Presbyterian and emphasizes collective action, regulation, and litigation to address them. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP513 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 Episode Setup 00:38 Why This Matters 04:41 Hospital Playbook 06:59 Consolidation Effects 11:41 All Or Nothing 15:24 Anti Steering Tiers 22:12 Price Gag Clauses 26:22 Squeezing Independents 31:15 Fixing The System 35:15 Wrap Up Sponsors

If we want clinical teams to take on risk, we have to reckon with what that risk-taking actually incentivizes. In this episode, Stacey Richter weaves together conversations with two physicians to surface a tension she argues hasn't been said directly enough: the very mechanism we're counting on to fix healthcare — providers going at risk — has cherry picking and lemon dropping baked right into it. And the same organizations we're asking to take risk are the ones we already know are upcoding every ER visit to level four complexity. In this episode, Stacey Richter speaks with Dr. Ahilan Sivaganesan, MD (Dr. Siva), a spine surgeon and researcher whose work on time-driven activity-based costing and the Operative Value Index appeared in EP505, and Dr. Monica Lypson, MD, MHPE, a physician and medical educator whose prior conversation with Stacey on this topic from EP322 has become, unfortunately, more relevant than ever. WHAT YOU'LL LEARN ✅ Why physicians cannot responsibly go at risk for outcomes and costs without first knowing their own costs — and why time-driven activity-based costing (TDABC) is, as Dr. Siva puts it, existential for surgeons navigating procedural bundles ✅ How sliding scale bundled payments, where payment adjusts to the complexity of the patient and the surgery, could address cherry picking and lemon dropping — but only if the cost data underlying that scale is transparent and independently validated ✅ Why handing health systems a sliding scale risk adjustment framework is, in practice, handing them their own version of a Medicare Advantage RAF — and how we know exactly what happens next, because we've watched Medicare Advantage upcoding and commercial down coding play out simultaneously ✅ How the whole person health model — as practiced in independent advanced primary care, the VA, FQHCs, and some community health plans — reframes the economics: when care is genuinely comprehensive, many of the current upcoded profit centers become cost centers ✅ Why the solution to gaming risk adjustment frameworks may be the same as the solution to gaming credit scores: a neutral, detached third party scoring patient complexity using ground truths that cannot be manipulated by the parties with a financial stake in the outcome ✅ How structural barriers — misaligned funding streams, office hours that exclude working patients, the absence of robust quality measurement in most network contracts — can produce cherry picking and lemon dropping even without any overt intent to discriminate WHY THIS MATTERS We are deep into the value-based care era and the perverse incentive problem has not been solved — it has been relocated. Fee-for-service incents volume. Risk-based models incent patient selection. As Stacey frames it, the holy grail we are promoting has the very same conflicts of interest baked into it that we say we can't trust doctors to handle. What this episode surfaces is a conundrum worth naming plainly: you can't ask biased parties to grade their own homework, and right now that's exactly what we're doing every time we hand a large, corporatized health system a risk adjustment framework and expect them not to put a finger on the scale. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP511 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 Introduction to this episode. 01:53 Upcoding problems: a previously unpublished clip from EP505 with Dr. Siva. 05:22 What is the minimum requirement for physicians to go at risk? 07:22 How sliding scale bundle payments can reduce risk for physicians. 10:43 The question covered in the upcoming episode. 13:19 Is value-based care good for underserved communities? 15:01 "If you create perverse incentives, you actually might make known healthcare disparities worse … to meet the demand's value." —Dr. Lypson 16:18 "There actually might be systematic and structural ways that the healthcare system might say … we're not interested in taking care of you." —Dr. Lypson 16:51 "The incentive to have a good outcome is not there; the incentive to have another visit is there." —Dr. Lypson 17:15 EP485 with Cristin Dickerson, MD. 17:49 "The only indictment I have on the fee-for-service system is that it's gotten us to where we are right now." —Dr. Lypson 18:41 "If you don't have any connection in that system, even the provider trying to … provide a good outcome might be disconnected because the system is not in place to … connect the dots." —Dr. Lypson 19:15 EP436, EP491, and SUMS9 with Elizabeth Mitchell. 19:28 What are the must-haves for a value-based system that create the patient outcomes we need? 19:51 What is a whole health model? 22:00 EP462 (Scott Conard, MD), EP319 (Grace Terrell, MD), EP431 (Kenny Cole, MD), EP409 (Larry Bauer, MSW, MEd), and EP495 (Mick Connors, MD). 22:23 LinkedIn post by Mark Weber. 25:05 EP484 with Dave Chase. 25:31 Why we need to fix the structural issues if we want to fix health. 26:00 Why a patient's bias is the one we want in the room. 27:36 Stacey's conclusion on this week's episode.

Employer medical inflation has averaged 7.7% annually over the last 20 years — and that was in a historically low inflation environment, so the near-term number is likely closer to 8.5%. If your finance team is forecasting health benefits at CPI, you are already behind. That single number, put into an out-year model and left to compound, makes the case for bold action faster than any benefits presentation ever could. In this episode, Stacey Richter speaks with Patrick Nelli, CEO of Aligned Marketplace and a former CFO, about a seven-step roadmap for how benefits teams can align with CFOs and finance teams to move away from passive price-taking — and toward a health plan that actually bends the cost curve. WHAT YOU'LL LEARN ✅ Why employer medical inflation is structurally set up to outpace CPI by two to three percentage points — driven by Baumol's Cost Disease, the absence of a functioning market to constrain prices, and Medicare cost-shifting to the commercial population — and why 7.7% annually should be the status-quo baseline in any out-year forecast ✅ How the physician employment shift of the last 20 years — from 80% independently employed to 80% hospital or corporate-employed — created a fundamental conflict of interest, because hospitals primarily make their gross profit on inpatient commercial surgeries and cannot simultaneously optimize for keeping people healthy and out of the hospital ✅ The three specific mechanisms by which independent advanced primary care drives savings for self-insured employers: unit price reductions from steering to lower-cost independent labs and imaging, reduced downstream utilization including ER visits and specialist referrals, and prevention of future high-cost claimants — backed by a Milbank study showing access to primary care increases timely cancer screenings by 20 to 50% ✅ Why a skeptical CFO should require counterparties to put their fees at risk in an aligned payment model — and why that alignment test is more persuasive than any published study ✅ How to structure a steering and tiering strategy by risk-stratifying members and disproportionately engaging those with high and rising risk, since less than 10% of low-cost members with identifiable risk today will drive over 40% of total plan spend next year ✅ How regulatory changes in the One Big Beautiful Bill Act now give employers more flexibility to offer advanced direct primary care and virtual care options at no cost to members — and why that creates a positive feedback loop between engagement, savings, and further benefit design improvement WHY THIS MATTERS The status quo is not neutral. It is a choice to accept 7.7% annual medical inflation in perpetuity, and as Stacey puts it, financial toxicity is increasingly clinical toxicity — when members can't afford their medications or land in financial ruin after an illness, that is also disruption, just experienced on the back end. The question Patrick poses is whether employers want some upfront disruption or the guaranteed disruption of a compounding cost curve. The roadmap here is not theoretical — it is a step-by-step translation of the benefits case into the language that finance teams actually use, with the goal of turning the CFO from a skeptic into an ally. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP509 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 Introduction to this episode. 02:48 Roadmap Step 1 highlights. 03:07 Roadmap Step 2 highlights. 03:49 Roadmap Step 3 highlights. 04:15 Roadmap Step 4 highlights. 04:27 Roadmap Step 5 highlights. 04:58 Roadmap Step 6 highlights. 05:19 EP504 with Ryan Jacobs. 05:37 Roadmap Step 7 highlights. 06:28 Introduction to the conversation with Patrick Nelli. 06:36 Step 1 to Patrick's roadmap: Open the conversation. 07:57 What Patrick thinks is sometimes missing in health benefits. 09:07 What finance teams need in order to change their behaviors. 09:53 What Baumol's cost disease is. 10:58 EP341 with Gary Campbell. 11:14 EP492 with Sam Flanders, MD, and Shane Cerone. 12:18 The second item stacked against employers: Being price "takers." 13:49 The percent inflation employers should expect if they follow the status quo. 15:39 INBW46 with Stacey. 16:54 Proven strategies to bend the health benefits finance curve. 18:42 EP391 with Scott Conard, MD. 19:37 SUMS11 with Stan Schwartz, MD. 20:18 How employers and plan sponsors can bend the cost curve. 21:47 The two distinct business models that finance teams need to consider when setting up their health benefits model. 24:11 Milbank study on the role of primary care. 24:53 A quick reminder of high-cost spending within health plans. 25:00 EP466 with Vivian Ho, PhD. 25:10 EP464 with Al Lewis. 25:59 What finance teams need to hear right now to understand why disrupting their health benefits plan is worth it. 27:45 The next step when an employer recognizes that they should seek out an advanced primary care option for their members. 28:41 EP503 with Ryan Wells; Leo Spector, MD, MBA; and Adam Stavisky. 30:27 Next steps after an employer enlists an advanced primary care system and aligns values and incentives in their benefits plan. 34:26 A last word to benefit teams working with finance teams. 34:55 EP430 with Barbara Wachsman. 35:08 How Aligned Marketplace fits into this entire conversation.

Employers pay roughly $1.20 to $1.30 for every dollar of actual healthcare their members receive. In one documented California lawsuit, a carrier charged a plan $4 million for a single inpatient stay and paid the hospital $877,000 — pocketing over $2.5 million, with MultiPlan collecting another $677,000. Knowing that, what should plan sponsors actually be trying to buy? Stacey Richter distills four core concepts for buying or delivering the highest value healthcare, illustrated with direct clips from 14 prior guests — Jonathan Baran, Cynthia Fisher, Mark Newman, Justin Leader, Elizabeth Mitchell, Dr. Sam Flanders, Shane Cerone, Jerry DiMaso, Ivana Krajcinovic, Ryan Jacobs, Adam Stavisky, Ryan Wells, Dr. Mick Connors, Dr. Ahilan Sivaganesan (Dr. Siva), and Dr. Kenny Cole. WHAT YOU'LL LEARN ✅ Core Concept 1 — Buy healthcare, not insurance: the difference is not semantic — it is the gap between what a plan pays and what a provider receives, illustrated by spread pricing, weekly claims wire mysteries, and administrative extraction that consumes 20 to 30 cents of every healthcare dollar before any care is delivered ✅ Core Concept 2 — Avoid the myth of less expensive care: price and quality are largely uncorrelated in healthcare, and the highest-quality, safest care often costs the least — as Dr. Sam Flanders puts it, doing things well eliminates the waste and errors that drive up costs ✅ How price transparency data now shows rate disparities from one employer to another for the exact same service codes — including one plan paying $38,000 for four infusions that cost $5,000 at an independent practice, and two members whose infusion site choice cost their plan $1 million more for the exact same drug ✅ Core Concept 3 — Consider direct contracting: connecting plan sponsors directly with independent clinicians and pharmacies eliminates administrative extraction and creates real incentives — provider organizations that can actually lose business have reason to compete on quality and price ✅ How Centers of Excellence networks represent direct contracting at scale — and why a physician-by-physician analysis showed bottom-15% physicians practicing medicine standard deviations differently from the median in their own market ✅ Core Concept 4 — Buy true value, outcomes over cost, measured across the entire care journey: not readmission rates in isolation but patient-reported outcomes anchored to what actually matters to the patient — including whether they ever should have had the procedure in the first place WHY THIS MATTERS Most big corporatized health systems are optimized for revenue growth, not outcomes. When a plan sponsor buys coverage instead of care, those incentives go unchallenged. Direct contracting creates a functioning demand curve where provider organizations compete on quality and price. As Dr. Kenny Cole shows, buying value ultimately means anchoring care to the patient: not an A1C below seven as an abstract target, but controlling diabetes so a fisherman can still feel the line when the fish bites. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP507 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ Featured Experts by Core Concept Concept 1: Buy Healthcare, Not Insurance Jonathan Baran, CEO, Self Fund Health (EP483) Cynthia Fisher, founder and chairman, PatientRightsAdvocate.org; co-founder and chairman of Power to the Patients (EP457) Mark Newman, co-founder and CEO, Nomi Health (EP496) Justin Leader, founder and CEO, BenefitsDNA (EP433) Concept 2: Avoid the Myth of Less Expensive Healthcare Elizabeth Mitchell, president and CEO, Purchaser Business Group on Health (EP436) Sam Flanders, MD, senior advisor, Kada Health (EP490) Shane Cerone, CEO, Kada Health (EP492) Jerry DiMaso, co-founder and CEO, Payerset (EP506) Ivana Krajcinovic, PhD, former vice president for healthcare delivery (retired), UNITE HERE HEALTH (EP501) Concept 3: Consider Direct Contracting Ivana Krajcinovic, PhD, former vice president for healthcare delivery (retired), UNITE HERE HEALTH (EP501) Suhas Gondi, MD, MBA, chief medical officer, HealthStrategy (EP404) Ryan Jacobs, senior vice president of health plan strategy and partnerships, Marathon Health (EP504) Komal Bajaj, MD, professor of obstetrics and gynecology, Albert Einstein College of Medicine (EP458) Adam Stavisky, business advisor, Stavisky LLC (EP503) Cristin Dickerson, MD, founder and CEO, Green Imaging (EP485) Stan Schwartz, MD, chief medical officer, ZERO.health (EP486) Leo Spector, MD, MBA, CEO, OrthoCarolina (EP503) Ryan Wells, founder and CEO, Health Here (EP503) Concept 4: Buy the Highest-Value Healthcare Mick Connors, MD, pediatric emergency medicine physician, Dayton Children's Hospital (EP495) Ahilan Sivagenesan, MD, neurosurgeon, Hospital for Special Surgery; Head of Quality and Value, Mishe Health (EP505) Kenny Cole, MD, System VP, Clinical Improvement, Ochsner Health (EP473) 00:00 Introduction to this episode and guests. 01:38 The four core concepts to buy or deliver highest-value healthcare: a summary. 06:01 An exciting show announcement. 07:32 Core Concept 1: Why buy highest-value healthcare, not "best" coverage? 11:28 Core Concept 2: Will employers fall victim to the myth of inexpensive care? 13:00 Why better-quality care vs. more affordable care is a false choice. 17:09 Core Concept 3: Direct contracting. 17:58 Why demand curve matters in healthcare cost. 22:08 How Centers of Excellence play into all of this. 22:54 Core Concept 4: How do you conceive of and buy high-value healthcare? 23:48 The value equation in healthcare. 25:35 What is value? 28:20 What whole-person care looks like. 30:24 Relentless Health Value Chatbot sneak peek announcement. 32:14 Coming up: looking at the episodes ahead.

Most hospitals cannot tell you the true internal cost of a single care episode. Not the medical device costs, not the personnel, not the consumables — the actual cost. And yet we operate a $5.6 trillion sector asking clinical organizations to take on risk for outcomes and costs they cannot quantify. As Dr. Siva puts it, you can never expect a physician to go at risk if they don't understand their own costs. Jumping in without that data is jumping blind into an abyss. In this episode, Stacey Richter speaks with Dr. Ahilan Sivaganesan, MD (Dr. Siva), a practicing neurosurgeon, researcher, and national leader in value-based care whose work focuses on the costs and outcomes of spine surgery, about a framework he calls the Operative Value Index (OVI) — and why it may represent the infrastructure shift that value-based care has always required but never had. WHAT YOU'LL LEARN ✅ Why the current approach to value measurement is backwards — we roll costs up to the highest level possible and drill outcomes down to the most granular metric available (handwashing rates, readmission rates, A1C), when what's needed is the exact opposite: unit-level costs via time-driven activity-based costing (TDABC) and whole-person, patient-reported outcomes across the full care journey ✅ How the Operative Value Index creates a common mathematical language — combining TDABC-derived costs with condition-specific patient-reported outcomes into a quotient that can compare surgeons, practices, or health systems, risk-adjusted for key confounders, giving self-funded employers something concrete to steer and tier toward ✅ Why appropriateness is the foundation of quality: a surgeon who sends patients to PT when that's the highest-value next step will look like a rockstar on OVI bubble charts — better patient-reported outcomes, lower total spend — while a surgeon who operates on everyone looks great under fee-for-service and terrible under any value-based framework ✅ How bubble chart transparency alone drove clinician behavior change without any payment incentive — surgeons are competitive, and once they can see where their bubble sits relative to peers on a value plot, the gears start turning immediately ✅ Why TDABC is existential for surgeons as procedural bundles expand: if a payer offers a fixed payment for a 90-day spinal fusion global, a surgeon who doesn't know their true cost of delivering that episode is going to get screwed — and there's no way to know which patients are favorable for a bundle without that cost infrastructure ✅ The "Yahoo vs. Google" moment: maximizing fee-for-service volume is Yahoo — stable, dominant, and confident it understands the business model. The ability to actually deliver and quantify high value is Google. Yahoo laughed. Until it didn't. WHY THIS MATTERS The value equation — outcomes divided by cost — is recited at every value-based care conference. But across most of this sector, both numbers are question marks. The OVI is an attempt to make them real, scalable, and comparable. When that infrastructure exists, self-funded employers can finally make intelligent direct contracting decisions. Clinical organizations that genuinely deliver high value can finally prove it. And the learning healthcare system — where transparency drives a feedback loop of improvement — becomes something more than a slogan. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP505 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls= 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 Introduction to this episode. 00:38 The goal of this episode. 01:28 What the Operative Value Index (OVI) is. 02:04 A quick episode overview. 04:23 EP434 with Benjamin Schwartz, MD, MBA. 04:44 How this episode came about. 09:24 How Dr. Siva got involved in the research around outcomes and costs. 11:51 How the value equation doesn't add up to true quality. 14:12 What measuring quality across the entire care journey means. 15:00 EP326 with Rishi Wadhera, MD, MPP. 15:08 EP295 with Rebecca Etz, PhD. 16:07 Why appropriateness is the foundation of quality. 19:08 Why practicing clinicians need to be thinking about the true costs of delivering care. 21:20 Time-driven activity-based costing (TDABC). 23:44 The two things that must be known for value-based care to succeed. 24:06 Article by Dana Prommel Strauss. 27:09 A quick summary of the conversation thus far. 30:42 The power of transparency in Dr. Siva's bubble plots. 32:39 EP449 with Marty Makary, MD, MPH. 34:05 Why these bubble plots work not just at the procedural level but at the diagnosis level, too. 36:13 EP503 with Ryan Wells; Leo Spector, MD, MBA; and Adam Stavisky. 36:21 EP501 with Ivana Krajcinovic, PhD. 36:30 EP398 with Jacob Asher, MD. 37:28 The "big blue ocean" opportunity for forward-looking providers. 38:52 Substack post by John Lee, MD. 40:37 The incredible opportunity for entities and groups that can help provide the infrastructure needed for this value index. 41:42 Essay written by Dr. Siva. 43:19 Last thoughts by Dr. Siva on TDABC and competition on value.

Knowledge Is Fiduciary Armor — On Making Better Decisions in a Healthcare System Built on Mystery and Margin The US healthcare system is a massive aggregation of millions of decisions made by millions of humans — actuaries, executives, benefits leaders, clinicians, and administrators. Our whole system is really what all those choices add up to. Which means better decisions, more informed decisions, decisions made with the right questions asked and the right spidey sense activated — those are what actually move the needle. In this Inbetweenisode, Stacey Richter shares listener responses to recent episodes, spotlights LinkedIn posts from Relentless Tribe members Ken Wosczyna and Michelle Bernabe, and riffs on the two things that separate a good decision from a bad one in employer-sponsored healthcare: transparent information you can actually access, and the understanding to know when what looks like transparency is actually another layer of onion. WHAT YOU'LL LEARN ✅ Why Ken Wosczyna's observation lands: "Healthcare doesn't lack frameworks or commentary. It lacks better decisions." In employer-sponsored healthcare, decisions about contracts, incentives, and pricing transparency aren't academic — they affect real dollars and real people, and the Relentless Health Value thesis is that sharpening judgment is how you change the system from within ✅ Why you can't make good decisions with transparency data alone — because the healthcare industry is so financialized and so vertically integrated that what looks like a clear price may be a carrier stop-loss trick, a PBM "discount" that's actually spread reclassified, or a consultant fee that doesn't have to be disclosed because it's technically paid at the book-of-business level ✅ A preview of price transparency data that allows self-insured employers to look up what peer companies — including competitors in the same industry — are paying for the same services by EIN, and why activist shareholders may not be far behind when they realize site-of-care differentials can mean millions of dollars on the balance sheet ✅ Why it may be time to rethink what disruption means: if a meaningful share of plan members who get sick are functionally uninsured, or if the status quo network includes an obstetrician with a 75% C-section rate for healthy patients who stays in network because removing them would be "disruptive" — the status quo is already disruptive, just quietly ✅ Michelle Bernabe's framing of the Relentless Health Value project as a "descent and return" — going into the belly of the system, following the thread of an incentive into the unintended consequences, and coming back with something that unlocks agency and creative potential for anyone trying to fix the pipes ✅ What a group of direct contracts is actually called — a Center of Excellence network — and why direct contracting is one of the cleaner ways to know what a provider is actually being paid, making it harder to get arbitraged in the middle WHY THIS MATTERS Knowledge isn't just power here. As Stacey puts it, it's fiduciary armor in a health system built on mystery and margin. The half hour a week that Relentless Tribe members put into this show is building pattern recognition — the instinct to catch a whiff of a problem, ask the awkward question, and protect members from predatory pricing before it lands on their kitchen table. The top words on the RHV podcast since 2014 are still the same: market, consolidation, transparency. The moles keep popping up. The point is to keep getting better at smacking them. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/INBW46 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 Introduction: trying something new with this inbetweenisode. 01:29 "Insight is common. Execution is rare.": a LinkedIn post from Ken Wosczyna. 03:02 SUMS8 with Larry Bauer, MSW, MEd. 03:08 The power of the C-suite versus the decision power of workers. 03:45 SUMS7 with Keith Passwater and JR Clark. 04:00 The power of actuaries to align with values. 04:50 Rate criticals for fixing the nonexistent healthcare market. 05:50 EP501 with Ivana Krajcinovic, PhD. 06:56 Why you can't fix what you don't understand. 07:46 EP472 with Eric Bricker, MD. 09:27 A comment from Craig Herndon. 10:44 Why avoiding disruption and problems with access can create disruption and problems with access. 12:22 A LinkedIn post from Michelle Bernabe. 12:26 EP500 with Stacey. 15:56 Looking ahead: topics future episodes will be covering. 16:07 EP503 with Ryan Wells; Leo Spector, MD, MBA; and Adam Stavisky. 17:08 A Web site/app for Relentless Health Value episodes. 18:24 EP480 with Kimberly Carleson. 19:22 Check out this episode's sponsor.

Here is what hackers are doing with stolen medical data: billing CMS for urinary catheters at $8,000–$9,000 each — items costing $10–$50 that were never sent to the seniors billed for them. In 2023 this totaled $3.5 billion. Dr. Tara Lagu's mother had two catheters billed in her name — $18,000 — that she never received. By 2025, one DME supplier that had never billed Medicare before January 1st was on pace to hit $1 billion alone. In this episode, Stacey Richter speaks with Brian Machut, a value-based actuary at Alliant Health who helps ACOs and provider organizations navigate value-based contracts, about how this fraud undermines shared savings programs — and why the damage flows downstream to self-insured employers. WHAT YOU'LL LEARN ✅ How the catheter fraud works: Eastern European bad actors used stolen Medicare data to bill codes A4352 and A4353 at $8,000–$9,000 per unit, running up $3.5 billion in 2023 claims — discovered by ACOs digging into claim-level data files and spotting codes that had rarely appeared before suddenly generating millions in attributed patient spend ✅ How fraud wipes out ACO shared savings: ACOs are measured against a benchmark cost per attributed patient; when a patient's record is used to bill $100,000 in phantom catheters, those costs count against ACO performance — erasing shared savings that physicians earned through real care management ✅ The unintended benchmarking twist: CMS's SAHS (Significant, Anomalous, and Highly Suspect) framework can paradoxically hurt ACOs whose patients were not targeted — removing fraudulent costs from the national trend lowers the benchmark those ACOs must beat ✅ Why skin substitutes are a bigger problem: projected at $13–$15 billion in 2025, skin substitute spending now rivals all of Medicare home healthcare as a share of fee-for-service cost — and CMS did not classify 2024 skin substitute costs as SAHS, leaving billions counting against ACO shared savings ✅ The "double trouble" problem: when CMS projects trend at 5% but actual costs come in at 8–9% partly due to fraud, ACOs face a benchmark set too low and actual costs above it — taking on policy and pricing risk that has nothing to do with the clinical decisions they can control ✅ Why self-insured employers are affected: health systems with commercial leverage negotiate higher commercial rates when ACOs miss shared savings targets; and the Medicare hospital insurance trust fund — currently projected insolvent by 2033 — is accelerated toward that point by $4+ billion annually in highly suspect spending WHY THIS MATTERS MSSP and ACO REACH programs exist partly to give independent practices the value-based revenue to transform their practice patterns and stay independent. When fraud eats those shared savings — and when CMS trend projections miss by 3–4 points annually — the policy and pricing risk starts to outweigh the medical risk these programs were designed to manage. That is exactly the wrong environment in which to ask providers to take on downside risk. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP502 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 One way hackers are using medical data to commit Medicare fraud. 01:49 What today's conversation with Brian Machut entails. 02:16 The downstream impact that this Medicare fraud can have. 03:30 A brief outline of how plan sponsors can be affected by this Medicare fraud. 06:38 What does a value-based actuary do? 08:04 The conversation with Brian Machut: What caused his team to look into DME costs and uncover Medicare fraud? 08:46 How much did this fraud scheme cost organizations in 2023? 09:57 How this data was tracked down and uncovered. 11:13 How fee-for-service ACOs work, and why this Medicare fraud affected the ACOs' shared savings. 12:46 The two codes that were the target of this fraud. 15:13 Across the U.S., how much money in 2023 did this fraud, waste, and abuse cost, and what was done about it? 16:14 The framework that was created to combat this fraud spend. 17:49 Why the CMS decision to pull those expenditures negatively affected some ACOs. 20:17 Where things stand now with this catheter fraud. 21:33 Why this fraud is still able to happen. 22:19 Is this a use case for prior authorizations? 23:49 How this Medicare fraud affects self-insured employers and what they should keep in mind. 25:12 What is the correlation to employee affordability? 27:08 A cost that dwarfs the catheter Medicare fraud. 28:21 A brief summary of skin substitutes. 29:32 What SAHS means, and how CMS uses it to calculate an ACO's shared savings. 31:21 Why CMS chose not to classify skin substitutes as SAHS. 33:26 Why this fraud affects ACOs' prospective trend pricing risk. 36:40 Why these fraud cases make participating in ACO programs less appealing to provider organizations. 38:28 Medicare Advantage Advance Notice for 2027.

If you rank California's commercial health plans by member count and check back every year for 14 years, the ranking barely moves. Kaiser at the top. The big blues plans close behind. Everyone else exactly where they were. This is not a competitive market. It is a stalemate. And the stalemate has causes. In this episode — the first installment of Relentless Health Value's "No Market" series — Stacey Richter speaks with Dr. Jacob Asher, MD, who served as Chief Medical Officer for Anthem, Blue Cross, Cigna, and UnitedHealthcare, about why the commercial carrier marketplace is so completely boring, why no one competes on quality, and what the six structural reasons are that keep the biggest plans exactly where they are. WHAT YOU'LL LEARN ✅ The six reasons the commercial carrier market doesn't move: employer inertia and the "disruption" conversation that kills switching; EBC compensation arrangements that add another layer of stagnation; carriers' focus on Medicare Advantage over commercial (where it's the employer's money at risk, not the carrier's); all non-Kaiser plans sharing largely the same provider networks; negotiating leverage tied directly to member volume so the biggest plans always get the best discounts; and employers who have never, in Dr. Asher's 14 years of experience, bought a plan because of quality ✅ The circular logic that keeps the big staying big: the largest plan gets the best unit price discount from providers because it brings the most volume, which allows it to offer lower premiums, which keeps it the largest plan — a flywheel that ensures no meaningful movement in market share rankings ✅ Why discounts don't equal lower prices: non-Kaiser plans negotiate discounts off provider retail rates, but the actual unit prices paid often converge across plans — and Dr. Asher notes he worked with people who claimed to have achieved price parity with Anthem and still saw no change in their market share ranking ✅ Kaiser's structural advantage and its limits: Kaiser leads California quality studies and offers the integration appeal of a unified medical record across all care settings — but it is no longer the cheapest plan in every California market, due to major investments in new hospitals, earthquake compliance, expanded specialty care, and IT infrastructure ✅ How broker and EBC relationships shape which plans even get a finalist presentation: the RFP process for large employers often uses unit price ranking as a first pass filter, meaning a plan that doesn't have the volume-driven pricing advantage may never get the chance to present its clinical differentiation at all ✅ Why "it's the prices, stupid" (Uwe Reinhardt) explains the whole situation: American healthcare utilization is not strikingly higher than other countries — the difference is prices, and in a market where no one is meaningfully competing on quality or network performance, prices go where the leverage allows them to go WHY THIS MATTERS Anyone relying on a market to constrain healthcare costs or raise quality is engaged in what Stacey calls magical thinking. There is no invisible hand. If you do not actively prevent getting taken advantage of, you will actively get taken advantage of. The commercial carrier nonmarket is not an accident — it is the predictable result of six interlocking structural forces that all reinforce each other. Understanding them is the first step to doing something about them, which is exactly what the "No Market" series is designed to enable. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/Take2-EP398 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 00:00 Introduction to the episode. 00:42 The "No Market" series. 01:51 Why is the carrier market boring? 04:26 A breakdown of what follows. 05:48 Six reasons why a marketplace doesn't actually exist. 10:04 Upcoming episodes in the "No Market" series. 10:41 The conversation with Dr. Jacob Asher. 11:01 What is the competitive picture of California's health plans? 11:03 Understanding the California health plan market. 12:28 What the competitive landscape looks like to get market share in California. 12:55 Challenges in market competition. 13:14 What are micro markets and market drivers? 15:14 How brokers and consultants shape the marketplace. 15:49 Why is it difficult to take market share? 16:56 Who was Dr. Asher pitching to and why? 18:56 How is Kaiser's position in the marketplace unique? 19:29 Did employers ever buy plans for quality? 23:23 What does this look like from the payer perspective? 27:42 What improvements have there been to engagement in health plans? 29:47 Have plans gotten better at communicating with employers? 31:19 Why is it hard to compare the Kaiser world to the non-Kaiser world? 31:19 Dr. Asher's final thoughts and reflections. 33:40 EP390 with Gloria Sachdev, PharmD, and Chris Skisak, PhD.

Plan Sponsors Are Paying Millions for MSK Injuries That Would Have Healed Themselves — Here's Why Musculoskeletal spend runs roughly $16 PMPM and accounts for 20–30% of total plan costs depending on member demographics — making it the third most costly category of spend. About 80% of those MSK injuries are low or medium acuity. A large percentage of those would heal on their own with ice, rest, and elevation. And yet plan sponsors are spending millions on ankle sprains. In this episode, Stacey Richter speaks with Dr. Jay Kimmel, MD, an orthopedic surgeon with over 35 years of practice in Connecticut and co-founder of Upswing Health, about why so much low-acuity MSK spend is avoidable — and what it takes to catch a member in the "white space" before they wind up on the wrong trajectory. WHAT YOU'LL LEARN ✅ Why 80% of MSK injuries are low or medium acuity but still generate massive spend: when members have no one to call in the moment they are injured, the default is the ER — and once they are sitting in an ER for six hours, they will demand an MRI, the MRI will find something (over-40 lumbar spine MRIs are full of false positives), and the referral cascade begins ✅ What the "white space" is and why it matters: the moment between "I just hurt myself" and "I am now a patient in the system" — when a member triages themselves with no clinical guidance; where they enter the system in that moment determines their entire downstream trajectory and cost ✅ How the state of Connecticut's claims data confirmed this: analyzing hundreds of thousands of state employee claims, Dr. Kimmel and his team found millions of dollars being spent with a diagnosis of ankle sprain — much of it unnecessary ER spend on injuries that would have resolved with basic self-care and guidance ✅ Why where you start often determines where you end up: a back pain patient who starts in the ER gets an MRI, the MRI finds incidentalomas, they get referred to an orthopedist or neurosurgeon, and 50% of back surgeries that follow are said to be unnecessary — turning a low-acuity problem into a high-acuity one ✅ Why the "triage before the triage" used to happen informally and no longer does: doctor's lounges, hospital rounding, and curbside consults between PCPs and specialists created spontaneous guidance pathways that have largely disappeared — and members are now left to self-triage with an answering machine that says "if this is an emergency, go to the emergency room" ✅ What Upswing Health does: members get access to an athletic trainer within 15 minutes and an orthopedic specialist within 24 hours — replicating the curbside consult dynamic at scale so members can be met in the white space and put on the right path before they self-select into the ER WHY THIS MATTERS The 2026 National Healthcare Expenditure data shows personal healthcare spending surging over 8% with no commensurate health dividend — people aren't getting significantly healthier, they are just getting more care, and not always the right care in the right setting. MSK is a concrete example of where that gap plays out in millions of plan dollars. It is not that members are making bad decisions — it is that they are being asked to make clinical judgment calls they are not equipped to make, with no one to call, at the worst possible moment. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP499 🔗 Visit Upswing Health: https://upswinghealth.com ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 07:49 EP472 with Eric Bricker, MD, on high-cost claimants. 08:01 What is the "white space" in MSK spend? 10:43 Statistics on Connecticut's spending on plan members with low-acuity MSK injuries. 13:30 How back pain also easily transitions from a low-acuity issue to a high-acuity problem. 15:11 How plan sponsors can detect their white space downstream spend. 16:58 EP464 with Al Lewis. 17:02 EP470 with Nikki King, DHA. 18:15 Why where patients start their journey often dictates where they wind up and how costly that medical pathway is. 20:48 Where PCPs fit into this MSK spend issue. 25:26 EP468 with Matt McQuide. 25:34 EP471 with Christine Hale, MD, MBA. 25:39 Why access is key.

What FQHCs Can Teach Every Healthcare Leader About True Fiscal Discipline. There are two very different ways to end up with no profit. One is genuine struggle. The other is simply being very good at spending every dollar you are given. In healthcare, we have no functioning market to tell the difference — and the organizations that are crying poor may just be inefficient. Federally qualified health centers, which cannot cost-shift to commercial patients and cannot restrict access, are one of the few places in American healthcare where fiscal discipline is a real constraint rather than a slogan. In this Take Two episode, Stacey Richter revisits a conversation with Gary Campbell, CEO of Johnson Health Center, an FQHC in Lynchburg, Virginia, and president of Impact2Lead — along with a framing segment on Nikki King, CEO of Alliance Health Centers in Indiana, whose approach to meeting patients where they are produced results without a capital budget. WHAT YOU'LL LEARN ✅ Why FQHCs are one of the best case studies for operational efficiency in healthcare: they have a revenue cap, cannot cost-shift inefficiencies to commercial patients, cannot restrict access, and must find a way to serve a challenging patient population with what they have — or that patient population does not get care ✅ Nikki King's approach at Alliance Health Centers: instead of building infrastructure, she put clinics in a courthouse (next to addiction treatment referrals from judges), a daycare center, a homeless shelter, and beside a basketball court — meeting patients where they already are at near-zero real estate cost; compare this to "razor thin margins" and new construction appearing in the same sentence ✅ Why the first instinct in any workflow problem — throwing a body at it — is often the wrong one: as Gary Campbell puts it, you can overstaff yourself into margins so thin they disappear, and "throw two bodies at it" is not a Six Sigma approach to operational efficiency ✅ Why involving clinicians in process redesign is not optional: administrators who make workflow decisions without including the nurses, physicians, and APPs who do the work get non-compliance, workarounds, and resentment — the people closest to the work have to be part of building the standards ✅ How to create fiscal discipline without sacrificing care: Campbell deliberately pulls clinicians off the floor — foregoing short-term revenue — to work on care team reengineering projects, with deliverables, project plans, and accountability, because unimplemented committee recommendations are worse than no meeting at all ✅ The leadership imperative that underlies all of it: vision (if the team can't see where they are going, they cannot be motivated around purpose), cultural alignment (people who are misaligned with the values will undermine the effort), and the discipline to make sure every meeting produces a concrete outcome — not just a record that it occurred WHY THIS MATTERS Financial toxicity is clinical toxicity. A clinical partner that lacks fiscal discipline isn't struggling — it is inefficient. And the plan sponsor, the union, and ultimately the member pays for that inefficiency in premiums, in cost shifts, and in care that should cost less than it does. FQHCs that do this well — like Johnson Health Center and Alliance Health Centers — show what is actually possible when the option to pass the cost along simply does not exist. Those organizations make genuinely useful benchmarks for any plan sponsor evaluating a clinical partner. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/TakeTwo-EP341 ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 09:03 Why is there no opportunity to cost shift in an FQHC? 09:34 What happens when an FQHC is operating inefficiently? 10:00 "Have you workflowed it out? … You can overstaff yourself in a way that your cost per patient goes way up." 10:23 Why is taking a lean approach not an excuse to cut staff? 11:27 EP490 and EP492 with Shane Cerone and Sam Flanders, MD. 11:35 EP438 with John Lee, MD. 11:38 EP455 with Beau Raymond, MD. 11:40 EP402 with Amy Scanlan, MD. 11:42 EP405 with Eric Gallagher. 12:48 "The nurses are linchpins to everything." 13:44 LinkedIn post from Eve Cunningham, MD, MBA. 15:10 How does standardizing care lead to personalization of care? 16:34 "Our clinical teams see that we care." 16:53 "If you don't have a vision for where you want to be two and three years down the road, you're struggling." 17:09 "I want everybody to understand, What is their why?" 19:45 Lean & Meaningful by Roger E. Herman and Joyce L. Gioia. 24:44 "You have to project plan things out that you want." 25:51 "They don't teach leadership in most medical schools."—Dr. Robert Pearl 26:46 Outlive by Peter Attia, MD. 27:55 "Get to know these clinicians." 29:39 "From a core values perspective, you can make every single decision … on core values." 30:03 "We always start with those values. … They're embedded in everything we do." 30:20 How does an FQHC or private practices that are patient-oriented attract talent? 35:24 EP297 with Jerry Durham. 35:54 "First and foremost, be visible."

Plan Sponsors Pay $1.20 to Buy $1 of Healthcare — and Providers Collect 80 Cents of That A self-insured employer pays $1.20–$1.30 to access a dollar of negotiated healthcare. Providers budget their business around collecting 70 to 80 cents of what they are contractually owed — because denial rates, unpaid patient balances, and collection timelines of 2 to 9 months are the operating reality. The gap — roughly $1.5 trillion a year by Mark Newman's accounting — is not one boogeyman. It is just the cost of the friction. In this episode, Stacey Richter speaks with Mark Newman, CEO and founder of Nomi Health, about why the life of a claim produces administrative waste accounting for 28–30% of total US healthcare spending — and the two structural reasons behind it. WHAT YOU'LL LEARN ✅ Revelation 1 — Data isn't data: as a claim moves through the system, each stakeholder — provider clinical team, provider billing, TPA operations, TPA payments, TPA treasury, plan sponsor HR, plan sponsor finance — works from a different data set with different fields, accounting periods, and definitions of what the transaction was ✅ How the fragmentation creates a barrier to negotiation: a plan sponsor says "we spent $10 million with you last year"; the hospital says "we received $5 million" — and both could be correct, once you account for member balances never collected, accounting method differences, and what the plan funded vs. what it accrued ✅ Revelation 2 — A dollar isn't a dollar: the employer pays $1.20–$1.30 to access a dollar of care (admin fees, consulting fees, PEPMs, transactional fees, broker costs, stop-loss); the provider collects 70–80 cents of what they are owed; and 12–15% of any health system or practice budget now goes to RCM staff — the cost of just figuring out how to get paid ✅ Why payment delays are not accidental: payers make 10–20% of profit margin on float — on billions held while providers wait 2 to 9 months to get paid — and providers, unable to run their business on the hope of a dollar, budget for 80 cents and absorb the rest as RCM overhead ✅ Why finance and HR within the same employer will have fundamentally different numbers: HR tracks cash claims outflows against a budget burn-down; finance accrues a flat monthly amount and hopes not to overrun Q4; neither may have line-item visibility into what the TPA is actually doing with the funds ✅ Why the gap is an opportunity: self-insured employers know how to negotiate, buy things, and manage cost of goods sold — the infrastructure to do that directly in healthcare is finally starting to exist WHY THIS MATTERS School districts cannot hire teachers because per-family healthcare costs have hit $40,000 a year and rising. Every dollar in friction is a dollar not available for wages, not available for better care, not reducing premiums — Figure out the comp model, as Charlie Munger said, and you know the outcome. The comp model for large payers rewards earnings per share and swagger — not lower costs. The only way forward is to bypass the 27 layers, and self-insured employers are the parties with purchasing leverage to do it. === LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP496 🔗 Visit our sponsor Nomi Health: https://www.nomihealth.com/ ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe 🫙 Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe 🎤 Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 🎤 Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b 📺 Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ✭ LinkedIn https://www.linkedin.com/company/relentless-health-value/ ✭ Threads https://www.threads.net/@relentlesshealthvalue/ ✭ Bluesky https://bsky.app/profile/relentleshealth.bsky.social ✭ X https://twitter.com/relentleshealth/ 06:48 What is actionable to know about the life of a claim? 08:14 How data can change as it moves through the claims process. 11:45 Why a dollar isn't a dollar in healthcare. 18:50 Why employers are actually paying more than a dollar to access a dollar of healthcare (the medical loss ratio). 21:54 Why cutting out the "friction" is actually better for employees and members. 22:48 EP482 with Preston Alexander. 22:50 EP472 with Eric Bricker, MD. 23:36 EP490 and EP492 with Sam Flanders, MD, and Shane Cerone. 23:53 Infographic by Andrew Tsang showing 27 streams of income. 26:53 How do we fix these issues? 28:05 LinkedIn comment from Sandra Raup. 28:59 How Nomi Health is experimenting with a no co-payment, no deductible model. 31:29 INBW42 with Stacey on moral hazard. 32:26 EP486 with Stan Schwartz, MD. 32:31 EP485 with Cristin Dickerson, MD. 32:56 The Innovator's Dilemma by Clayton M. Christensen. 34:55 How does Nomi Health work with and help employers?