EP457: It’s a Big Thing: Medical Spread Pricing. So, Let’s Talk About Contract Transparency, With Cynthia Fisher

[00:00:00] Episode 457, It's a Big Thing, Medical Spread Pricing. So, Lets Talk About Contract Transparency. Today on the show, we have Cynthia Fisher.

[00:00:20] American Healthcare Entrepreneurs and Executives You Want to Know, Talking, Relentlessly Seeking Value.

[00:00:29] I'm putting a meme in the show notes. It's my second meme ever, so I'm clearly on a roll. It's a picture of two kids taking a test and the one kid is cheating off the other.

[00:00:39] It's a, how to do spread pricing test and the kid with carrier has his eyes all over the PBM kids test. Look, this is a thing now, medical spread.

[00:00:51] And similar to how PBM spreads adds up to millions, billions of dollars, medical spread is not change in the couch cushions. Did you see the lawsuit against Cigna?

[00:01:02] Cynthia Fisher mentions it in the conversation that follows. Spoiler alert, here's the numbers. Self-insured employer paid $4 million for a claim.

[00:01:11] In this case, there's a slide on this Cynthia Fisher gave me in the show notes, by the way, if you want to see all this written out. So, the employer pays $4 million.

[00:01:21] The provider was paid, drumroll please, $876,000. I'm pausing so that sinks in. $4 million paid by the employer. $876,000 of that makes it across the trench to the provider.

[00:01:36] What happened, you may be wondering, to the $3.2 million in the middle there that the self-insured employer wrote a check to their carrier for?

[00:01:44] If I'm the employer, I think I would sort of want to know where the $3.2 million went because, yeah, I think anyone would be hard-pressed to explain how a prudent fiduciary is managing to pay millions of dollars of its plan members' money for services that actually cost a fraction of that.

[00:02:03] And this is just one claim. But you came here for a show about transparency. Why? You may be wondering, am I talking about medical spread pricing?

[00:02:11] It's not a super far leap, so many of you are probably there already, but let me quote Chris Deacon. She wrote,

[00:02:18] As these conglomerates expand control over healthcare delivery and administration, radical transparency is our only bulwark.

[00:02:27] Patients and employers deserve to know exactly what they're paying for without hidden fees disguised as care costs.

[00:02:34] I don't think anyone would say that transparency alone is sufficient to transform healthcare, but it's definitely a start for sure.

[00:02:43] So, yeah, transparency. The reason why lawsuits about overpayments, big ones, and there's a bunch of them afoot right now, not just that signal one.

[00:02:51] But the reason that these are going down in the first place is because hospital prices and carrier prices are now somewhat available.

[00:02:58] And we have some plan sponsors, the ones who are worried about fiduciary duty at least, these plan sponsors are able to cobble together the math to catch a glimpse of how much money is vanishing.

[00:03:10] Dollars they and their members are paying for medical claims that never make it to the care team providing the care.

[00:03:16] And who is shocked? Are you shocked? I'm not shocked.

[00:03:18] Let me read a sentence from a carrier contract that Justin Leder sent me the other day.

[00:03:22] Section 6.3, claim administrator's compensation for its services under the agreement shall include the difference between the net claim payments reimbursed to the claim administrator by the employer and the net amounts paid to providers by the claim administrator.

[00:03:41] Translation, we are allowed to add spread pricing.

[00:03:44] We are able to arbitrage. We are able to mark up or whatever you want to call it by any amount we want.

[00:03:50] And you plan sponsor just signed up to pay for it.

[00:03:53] So that happens. Listen to episode 433 with Justin Leder.

[00:03:57] By the way, the show is called The Mystery of the Weekly Claims Wire, otherwise known as the not transparent weekly claims wire.

[00:04:06] So look, transparency, we can talk about it in terms of medical prices.

[00:04:09] We can talk about transparency in terms of contracts and actually also in terms of quality, but we don't get into that today.

[00:04:16] Bottom line, plan sponsors need enough access to billing data and hospital prices to calculate how much the middle folks are taking in spread, which is, as aforementioned, quite a thing.

[00:04:27] For more actual data on the magnitude of spread pricing goings on, ask Dan Ross.

[00:04:33] That's my suggestion.

[00:04:34] He's got spreadsheets he can show you of how much plan sponsors are paying and how much providers are charging and how much is going missing in the middle.

[00:04:41] For even more on this, read the recent Owens and Miner lawsuit that just got filed.

[00:04:47] Link in the show notes, which is just a case study in how hard some of these middlemen slash carrier entities are working to obscure and hide what they are doing.

[00:04:57] Because, yeah, sunshine is a great disinfectant.

[00:05:00] And that's what transparency is.

[00:05:02] Sunshine.

[00:05:02] I say all this to say this is the kind of transparency that Cynthia Fisher and I talk about in the show today.

[00:05:10] Contract transparency, billed charges transparency and hospital or medical price transparency for plan sponsors.

[00:05:16] We do not get into today consumers or patients using price information to shop.

[00:05:21] Just FYI.

[00:05:22] We also do not get into really price convergence, which is what happens when hospital and carrier prices become available in a market and is often brought up.

[00:05:32] On or about conversations about transparency.

[00:05:35] OK, I will say just one thing about price convergence.

[00:05:38] There was some chatter and anti-transparency press releases from parties mostly that didn't want to be transparent at all.

[00:05:46] No way, no how.

[00:05:47] But there was some talk a couple of years ago that if contracted prices became transparent, the health care industry would raise their prices to match the highest in the market and the result would be rising health care prices and greater total costs.

[00:06:01] That turns out it seems to be false.

[00:06:05] Link in the show notes to a study that shows that the bottom of the market, those with the cheapest prices do in fact raise their prices, but not as much as the top of the market lowers theirs.

[00:06:18] So there is actually net savings.

[00:06:21] Again, there's a link in the show notes to a turquoise health study and an article that Forrest Zhao and team posted that shows this.

[00:06:28] And it's the first study of its kind, at least that I have seen.

[00:06:31] OK, so contract transparency, data transparency.

[00:06:34] That's what's on deck to discuss today with Cynthia Fisher, as I have mentioned several times already, who has a long history as an entrepreneur in the health care space.

[00:06:43] So Cynthia Fisher gets U.S.

[00:06:45] Health care and she gets being a plan sponsor and a fiduciary.

[00:06:48] She is founder and chairman of PatientRightsAdvocate.org, as well as Power to the Patients.

[00:06:54] Her focus is on ensuring that all health care shows prices up front so that we can have accountability and integrity in billing and at any point of care.

[00:07:03] Cynthia has said early and often that transparency protects the ultimate purchasers of health care, meaning plan sponsors, plan members and patients from overcharges, spread pricing or otherwise.

[00:07:14] Where there's mystery, there is margin, as Anthony Chacha has said often.

[00:07:19] Cynthia's call to action is as follows, but listen to the show to hear her say it more eloquently.

[00:07:24] C-suites, CFOs, in-house counsel use purchasing discipline that your company probably uses elsewhere in the procurement of health benefits.

[00:07:33] Cynthia Fisher also says, as part of the call to action, refuse to sign blank checks to the health care industry and refuse anti-audit provisions.

[00:07:42] She also has a call to action for the accounting industry to stop ignoring auditing the health plans.

[00:07:48] And this matters just given the bald-faced fact right now that overcharges are party-sized.

[00:07:55] Let me wrap up with this.

[00:07:56] There's a lot of brute force tactics out there being deployed by some plan sponsors that effectively keep plan members from getting the care they need because they are functionally uninsured.

[00:08:08] I've done multiple shows on this and I'll link to some of them in the show notes.

[00:08:12] I just can't help to think some pretty savage cost containment strategies might be unnecessary if middleman excess profits were eliminated.

[00:08:21] Well, I say this with some evidence, actually.

[00:08:23] Andres Meng was on the pod.

[00:08:25] He talked about saving 15% or more by being smart about contracts and plan assets at the financial and purchasing level.

[00:08:31] Brian Ulig was talking to him the other day.

[00:08:33] He was telling me he saved $80 million just doing contracts right.

[00:08:37] Also, Claire Brockbank talks about this.

[00:08:39] Cora Ops, all too, from 32BJ.

[00:08:41] Those are two recent shows, again, about how much money can be saved by only signing contracts that ensure transparency.

[00:08:49] My name is Stacey Richter.

[00:08:50] This podcast is sponsored by Aventria Health Group.

[00:08:53] And this is my conversation with Cynthia Fisher.

[00:08:55] Cynthia Fisher, welcome to Relentless South Value.

[00:08:58] Thank you, Stacey.

[00:08:59] It's an honor to be here with you today.

[00:09:01] It is such an honor to have you here today.

[00:09:03] Just starting here, what is the goal of patientrightsadvocate.org at the highest level?

[00:09:08] Why don't we start there?

[00:09:09] Yes.

[00:09:10] I mean, the real goal here is, Stacey, as you well know, we pay way too much for health care in this country.

[00:09:16] We're paying over two times more than any other developed country that the U.S. competes with.

[00:09:24] And when we look at it as a whole on a macro level, that means our country can't compete for workers' jobs and our American businesses because we pay so much in health care that it's actually affecting our American competitiveness.

[00:09:41] And I'd also say, as a former entrepreneur in the medical space, I know that the American dream gets impacted when people maybe don't leave their jobs to go to an entrepreneurial startup because of fear that their health care might not pay for their wife's diabetes or breast cancer or her husband's disease.

[00:10:03] You mentioned we pay 2x the cost for health care in this country of other developed nations.

[00:10:11] And then you said that really impacts American competitiveness.

[00:10:14] I know that logically that would make sense.

[00:10:17] But do you have any hard evidence that American competitiveness is diminishing on the global scale because of the cost of fringe health care benefits that employees cost?

[00:10:28] Well, when you see the trends of, for instance, manufacturing jobs going overseas, a good example, which I was disheartened recently, was John Deere.

[00:10:40] He announced that it was moving its manufacturing out of Illinois to Mexico.

[00:10:44] When you look at the cost of health care in Mexico and the cost of labor in Mexico, it's a mass exodus for us as a country when the average cost for a family health plan that employers and workers share is over $24,000 a year.

[00:11:04] That's outrageous.

[00:11:06] You know, when you look at that compared to other countries having a far lower cost, what health care costs is an essential tax really to the businesses.

[00:11:18] So I think what we have seen as a country is largely a lot of these jobs have been moved overseas.

[00:11:25] I know of a major food industry manufacturer that has moved their accounting department to the Bahamas because health care is a lot cheaper.

[00:11:36] And this is also affecting American ingenuity and not perhaps leaving jobs because of the security of having health care in a major company.

[00:11:48] But I do think, too, if you look at the statistics that you've covered many times on your podcast, we're seeing sometimes as much as two and a half times.

[00:11:59] We're approaching two and a half times more than other developed countries.

[00:12:02] And we're dying earlier than these developed countries.

[00:12:06] We're dying four years earlier, which correlates to outcomes of care not being what we would expect for our country.

[00:12:15] So on the macro level, health care is affecting also our quality of life and the quality of outcomes and at a substantially expensive cost.

[00:12:28] Yeah, there was a study that I saw recently.

[00:12:31] They were asking people what their major concerns are, you know, just Americans.

[00:12:36] And I think number one was the economy, as it always is.

[00:12:38] But number two was health care costs.

[00:12:40] So, I mean, this is not a small issue, what you're talking about.

[00:12:43] To that point, the National Federation of Independent Businesses, which is a lot of businesses across the country, especially small and medium size, for over 30 years running, every single year, the biggest cost concern has been health care.

[00:13:00] It is the top line item in their annual survey of what they believe very firmly needs to be addressed.

[00:13:07] And that's the ability to hire more workers and to be successful and compete.

[00:13:11] I like how you teed it up with John Deere, where you said, hey, look, you know, if you have a premium that costs $24,000 a year for a family, then add that to a wage.

[00:13:21] Like, I think that is a concept that many kind of don't think about.

[00:13:25] If you're thinking about this from the employer standpoint, whatever the salary is of someone, add $24,000 to it.

[00:13:31] Here's my next question for you, though.

[00:13:32] There's any number of things that you could have focused on and you chose transparency.

[00:13:38] So why do you think that transparency is a root cause big enough that if you solve for transparency, you lower health care costs?

[00:13:47] It's common sense.

[00:13:49] Yes, if we have prices.

[00:13:51] Prices will allow for a market to function because when you have a price, then you know that the bill should match that price.

[00:14:00] If there's transparency throughout the system, what we will start to learn is what is the spread pricing that the insurance companies and all the middle players are adding, like pharmacy benefit managers and claims adjusters,

[00:14:19] where all the different middle players that are affecting rising costs in health care,

[00:14:24] what is the toll they're putting and the spread price they're putting on that same medical bill.

[00:14:31] And so when we see transparently what prices are and what all the different fees are associated and where they're going, well, then we have power.

[00:14:41] And that's when we have power to be able to choose not to overpay.

[00:14:46] The reality is prices are going to be so transformative because they will provide integrity and accountability into the health care system.

[00:14:56] And that transparency spreading to billing and payment and quality and outcomes, because those information and data will also be ushered in.

[00:15:08] People simply want to know what are they going to get and what's it going to cost?

[00:15:11] To that end, what's been going on legislatively or legally or in the market even maybe to empower those looking to reveal these deliberately hidden prices that self-insured employers, for example, are paying because they hide medical spread?

[00:15:25] Like, you know, obviously, as Anthony Chacha has said a million times, where there's mystery, there's margin.

[00:15:29] So all these parties with their hands on employer and employee slash member money, they have every incentive to pull out every trick in the book to not be transparent about what's going on in the middle there.

[00:15:42] Several years ago, when the Trump administration was in place, we, our organization, PatientRightsAdvocate.org, studied existing law.

[00:15:52] And we found there were four existing laws, and I would call them 800-pound gorillas, that gave us the right to know all of these prices.

[00:16:01] And so the good news is we took in the playbook to say you could get it done without Congress because these laws were collecting dust on the shelf where we had the right to know all prices.

[00:16:11] ERISA is one of them for employers decades, decades old.

[00:16:15] The other was the Affordable Care Act, and there are others.

[00:16:18] But the administration put an executive order in place, the president did, for making sure all hospitals and insurance companies provided all actual prices.

[00:16:27] So it's been only, Stacey, three and a half years now that we have the right to know all prices by law implemented.

[00:16:36] This is so bipartisan because the Affordable Care Act was Obama and then Trump and then Biden leaned in to up the fines to $2 million per hospital not complying.

[00:16:46] We see around 34% of the nation's hospitals fully complying with the law.

[00:16:52] And if you go to our website, PatientRightsAdvocate.org, we have all 6,000 hospitals' actual pricing files aggregated on our website,

[00:17:01] and then we have them converted to an Excel spreadsheet so they can be human-readable.

[00:17:05] But it's not easy because it's very itemized and detailed by code.

[00:17:12] But what we're starting to see from this data is within the same hospitals that their prices vary 10 times on average.

[00:17:20] So you can see one person get a colonoscopy with all the same coding, say with UnitedHealthcare or something, for $1,200.

[00:17:29] And another Blue Cross plan may be charged $12,000 for that same quality, same team, and the same hospital.

[00:17:38] Just giving this as an example.

[00:17:39] But the reality is we're also seeing 31 times difference across hospitals.

[00:17:44] We are at the very beginnings of having this data all unleashed in an accessible format so we can start to see the outrageous price differences.

[00:17:55] So if I'm parsing what you said there, the original question was what's going on that may help the ultimate purchasers of healthcare,

[00:18:02] such as plan sponsors like self-insured employers or patients themselves,

[00:18:06] to be able to see the prices that they're paying or are going to pay.

[00:18:09] And that matters for two reasons.

[00:18:12] One is the wild price variations, which transparency has revealed in which, frankly,

[00:18:18] anybody with fiduciary duty may be concerned about.

[00:18:21] I mean, you've got same hospital, same team, same code,

[00:18:23] and one plan sponsor can be charged 10x what the other will be charged.

[00:18:28] This is at the same time that we're at a moment where Americans,

[00:18:32] and that includes plan sponsors,

[00:18:33] are cottoning on to the fact that just because there is a carrier in the midst of any transaction

[00:18:39] does not mean that the price will be reasonable.

[00:18:42] It's becoming more clear, I think, to many,

[00:18:45] that middle people are, in fact, doing the traditional middle people thing

[00:18:49] where they take a piece of every transaction and this further drives up prices.

[00:18:53] It's called spread pricing.

[00:18:54] And I think, too, your point is,

[00:18:56] how can you have a functioning market when stuff like this is going on?

[00:18:59] That's where prices come in, right?

[00:19:01] Price transparency shifts the power really to the purchaser,

[00:19:05] and the purchaser is the employer, the union, and the patient.

[00:19:09] Yeah, I mean, we got 48% of Americans who delay or forego care due to fears of cost.

[00:19:14] We got 41% with some kind of medical debt.

[00:19:17] It's really going beyond the place that is ideal or even acceptable in the eyes of most people.

[00:19:22] So you said, good news.

[00:19:24] Three and a half years ago, there was an executive order which was recently bolstered

[00:19:28] that hospitals and carriers have to reveal their prices.

[00:19:30] To your point, yes.

[00:19:32] I think people are fed up.

[00:19:34] Almost everyone, if you ask a room to raise their hand,

[00:19:38] if they feel that they themselves or a family member has been overcharged by a medical bill,

[00:19:43] almost everyone has experienced an outrageous overcharge.

[00:19:47] And just try to fight it.

[00:19:48] But the reality is, is now that we can see prices, not just from the hospitals,

[00:19:54] but the insurance companies have to post all of the actual prices that they negotiated

[00:19:59] with the hospital and then any other provider.

[00:20:03] And so once we start to see this information be revealed, we can understand what is a normalized price,

[00:20:11] for instance, an ACL repair.

[00:20:14] What should an ACL repair with no complications cost?

[00:20:17] And some of the lower cost prices that we're seeing from price transparent surgical centers

[00:20:24] is around $6,000 to $7,000.

[00:20:27] All in.

[00:20:28] All in.

[00:20:28] What we're seeing sometimes in other hospital settings, we're seeing patients with bills

[00:20:34] $40,000 to $60,000 for an ACL repair with no complications.

[00:20:37] So if one can see and lock and load on an exact price, then those bills should match that price.

[00:20:45] And when they don't, that gives remedy and recourse.

[00:20:48] It gives a lot of power.

[00:20:50] That's a big, big shift.

[00:20:52] And you're right.

[00:20:53] I think it's just at the moment of time where we're starting to get the data unleashed

[00:20:59] and we're starting to learn from it.

[00:21:00] And we're learning that we are paying through the nose.

[00:21:05] And some of the lawsuits out there, Stacey, that are starting to reveal the overcharges

[00:21:11] by, like you said, the insurance carriers that are acting as third-party administrators.

[00:21:17] And then you've got the pharmacy benefit managers.

[00:21:19] When we start to pull back the curtain, it's outrageous.

[00:21:22] There's a lawsuit right now in California where in the discovery process, it's published

[00:21:28] that Cigna for an inpatient stay took three and a half times more from the employer charged

[00:21:36] that than what they paid the hospital system.

[00:21:39] Three and a half times more.

[00:21:41] And so what we're looking at is a $4 million bill for one patient inpatient stay.

[00:21:46] And the provider was paid $877,000.

[00:21:50] And Cigna pocketed over two and a half million.

[00:21:53] And then Multiplan got another $677,000.

[00:21:56] Two middle players pocketing over three and a half times more.

[00:22:00] Yeah.

[00:22:00] And that case, we can link to it in the show notes.

[00:22:04] It's kind of nuts what's going on out there.

[00:22:06] Just to restate what you said, because it's so striking in this one case,

[00:22:10] the employer paid over $4 million for the claim.

[00:22:13] The provider got paid $877,000, $876,000.

[00:22:18] Multiplan and Cigna together kept $3.2 million, roundabout there, right?

[00:22:22] Provider gets $877,000, bottom line.

[00:22:25] The employer plan sponsor paid $4 million for what should have cost $877,000 plus at most

[00:22:32] a reasonable admin fee.

[00:22:33] I'll send you the slide.

[00:22:35] And this is happening.

[00:22:36] That was the first claim we looked at.

[00:22:37] I could see though that that would actually make it very difficult for a consumer to shop

[00:22:41] because like, let's just say that that patient slash member went to the clinical organization

[00:22:46] and asked what their price was.

[00:22:48] Then they get a bill for...

[00:22:50] 3.5 times more is what Cigna took.

[00:22:52] Yeah.

[00:22:52] 3.5 times more.

[00:22:53] I think what I'm really taking away from what you're saying is when consumers shop,

[00:22:58] when members shop, that actually puts the employer on notice that sooner or later, because who's

[00:23:05] going to shop?

[00:23:06] Really?

[00:23:06] It's going to be highly health literate individuals who have enough understanding of the healthcare

[00:23:12] system that they're able to do this.

[00:23:14] Who are the people who are likely to cause trouble legally for an employer or know enough

[00:23:19] to create a class action lawsuit or whatever it is.

[00:23:22] It's probably the same people.

[00:23:23] So, right, like I could see that as an employer, there may start to be, you know, maybe the time

[00:23:29] is right, especially with the CAA, etc., which we've talked about at length on this podcast.

[00:23:34] Like you start getting those transparent prices available to a certain cohort of individuals

[00:23:40] who may be members of your plan.

[00:23:42] If there are unsavory things going on, those may be revealed and that could put a plan sponsor

[00:23:51] in jeopardy is kind of what I'm hearing, like legally or reputationally, whatever, either

[00:23:57] way.

[00:23:58] Yeah, well, I think that's interesting because the lawsuit I talked about was actually the

[00:24:02] provider.

[00:24:02] The hospital was suing because of the take of the middle player of Cigna and they sued

[00:24:08] Cigna and the employer had no idea they were overpaying by that amount.

[00:24:12] The employer didn't know.

[00:24:13] Kind of yikes on that, but okay.

[00:24:14] I know that's a major yikes that the employer didn't know they way overpaid their insurance

[00:24:18] carrier and their multi-plan.

[00:24:21] In fact, the employer would assume that there would just be sort of like a small transaction

[00:24:27] fee, right?

[00:24:28] But the reality is it's all in the contract language and the employers are being hosed by

[00:24:33] that contract language, which is essentially we get to keep 28% of the amount we save off

[00:24:40] of the total sum billed.

[00:24:41] So somehow the total sum billed was $11 million.

[00:24:44] So they got to keep 28% of the delta between that and ultimately what the employer ended

[00:24:52] up paying was over $4 million when they probably should have paid that provider around closer

[00:24:57] to the $877.

[00:24:58] Yeah, I just saw some contract language from a standard contract that actually Justin Leader

[00:25:05] sent me that included a provision for these spread markups.

[00:25:09] I mean, it was clearly stated right in the employer plan sponsor contract.

[00:25:13] You shall pay spread on medical fees.

[00:25:16] That said, the reality is, is that we're starting to see more lawsuits of these overcharges by the

[00:25:22] C-suite that is waking up of these big companies that are realizing, going back to the beginning

[00:25:28] of our discussion, that they're being harmed and their workers are being harmed by the egregious

[00:25:34] overcharging that's happening in the shadows and in the darkness of opacity.

[00:25:39] And so when we're seeing Kraft Heinz sue for a billion two, Aramark suing for a billion six,

[00:25:46] Ford Motor suing Blue Cross for a billion, that's real money.

[00:25:49] And they believe very firmly they're being overcharged and they want their data.

[00:25:54] And they're suing for data on their claims and billing payments.

[00:25:57] And they want to understand all the spread and all these charges so that they can have

[00:26:01] accountability and integrity.

[00:26:03] That was quite a list of companies who are getting legally engaged here because of the newly

[00:26:12] transparently available information.

[00:26:14] Let me push back a little bit, though.

[00:26:16] So let's say that an employer gets information, they look at it, they realize that one hospital,

[00:26:25] the colonoscopy costs $3,000, another hospital, exactly the same quality or whatever, costs $12,000.

[00:26:31] So they're like, you know what, we want to try to steer our members over to the $3,000 hospital.

[00:26:36] Then you look at the contracts and they have the anti-steering, anti-tiering contracts.

[00:26:40] So it makes it really difficult for employers who may be fully aware that they're getting

[00:26:47] hosed in one area or another to make that information actionable.

[00:26:53] How do you think about that?

[00:26:55] First of all, you're absolutely right.

[00:26:57] It's the contracts.

[00:26:59] Stacey, I mean, what other market, what other supply chain,

[00:27:03] what other area would anybody tolerate not being able to shop where you want to shop?

[00:27:09] That's what an anti-steering language is.

[00:27:12] It's like I can't create a program or a health plan because Blue Cross Blue Shield or Cigna

[00:27:18] or Aetna or United won't allow me to design the plan to get the best quality of care at

[00:27:23] the lowest possible price, the best value for all of our members and employees.

[00:27:29] I mean, think about it.

[00:27:30] The other part of the contracts is the insurer or the acting as a third party,

[00:27:36] they can basically add additional fees as they deem fit and pay themselves.

[00:27:42] I mean, it's a blank check.

[00:27:44] They'll also add things like anti-audit provisions.

[00:27:47] Now, you have to wonder if someone is saying,

[00:27:52] no, you can't audit my math.

[00:27:55] You can't check my math.

[00:27:56] You can't check what we're doing.

[00:27:59] We're not going to allow you to see how your money that we're handling for you is being spent.

[00:28:05] I mean, right there in that contract language.

[00:28:08] And the reason being is that for so long when there was major medical and back in the day

[00:28:15] when employers first contracted for health plans, they did it through HR and they didn't

[00:28:22] do it through their legal counsel and their CFO and their procurement officers.

[00:28:26] And we've gotten to the point where the greed has run amok so much, Stacey, that the C-suites are waking up.

[00:28:33] And that's why we're seeing lawsuits like Kraft Heinz and Aramark.

[00:28:38] And we're also seeing unions sue like the sheet metal workers and the mass laborers and others that are starting to see from the hospital pricing files.

[00:28:49] And then they compare their claims billed.

[00:28:51] They're finding overcharges.

[00:28:53] And so they're suing.

[00:28:54] We had Andreas Mang from Blackstone on the pod.

[00:28:58] He was echoing kind of the same sentiment that there's this kind of financial layer that's sitting in health care right now.

[00:29:04] Health care has become financialized.

[00:29:06] And if you get actually purchasing discipline and the finance folks who know how to evaluate a contract in the mix, you can cut costs 15%, something like that.

[00:29:15] Without impacting care in any way.

[00:29:19] It's just there's so much additive financial costs that have been wrapped around that you can save 15% just by stripping them away.

[00:29:27] So I thought that was super interesting and very much in alignment with what you're talking about.

[00:29:33] I also just want to mention that from 32BJ, we have had Cora Opsal and Claire Brockbank on the pod talking about some of the exact and specific things that they have done related to what you are talking about.

[00:29:45] Oh, also, of course, Justin Leder, episode 433, the mystery of the weekly claims wire is kind of a wealth of insight into how many of these hidden charges come about.

[00:29:55] All these links I'll make sure are in the show notes.

[00:29:57] Cynthia Fisher, is there anything I neglected to ask you that you would like to mention here?

[00:30:01] Well, I think what's so encouraging is that this is a movement.

[00:30:06] Price transparency is something that everyone simply gets.

[00:30:10] And, you know, look at what Mark Cuban's doing with cost plus drugs.

[00:30:15] It's really rewarding to hear someone say, look, Cynthia, I didn't understand what price transparency was about until my father said he was going to stop taking his money.

[00:30:27] He was a prostrate drug because it was over $3,000 a month out of pocket.

[00:30:31] And he would rather have those monies preserved for her sister and her in his death as a legacy rather than take the drug.

[00:30:40] And she actually went on Mark Cuban Cost Plus and found that the drug could be procured for $30 a month of their out-of-pocket costs.

[00:30:51] $30.

[00:30:52] Not $3,000.

[00:30:53] That's crazy.

[00:30:54] It's those stories that keep us going to keep fighting this fight.

[00:30:58] It's an individual fight.

[00:31:00] It's a corporate fight for the C-suite, the CFOs and the CEOs and the lawyers in contract language standing strong.

[00:31:08] But I say that it's an opportunity and time for the industry to know that the train has left the station.

[00:31:15] Look, when I started my Viacord business 32 years ago, I came from the tech sector, Stacey, where everything that was developed in tech had to be better, faster, and far more reliable and at a far lower cost price-wise.

[00:31:32] Healthcare can do the same thing.

[00:31:34] And healthcare, unfortunately, the industry uses government for protectionism and uses opacity to overcharge.

[00:31:41] It is not hard to make a decent and fair profit and do the right thing.

[00:31:46] That can happen in healthcare in the U.S. system, and it should happen in our country more than any other country.

[00:31:52] And that should be our competitive advantage.

[00:31:54] And instead, it's our competitive disadvantage.

[00:31:57] It causes dis-ease on many fronts, financial dis-ease and health dis-ease.

[00:32:04] So I think that this is a call to action for the industry.

[00:32:07] It's a call to action for employers to come together and refuse to sign blank checks and refuse anti-audit provisions.

[00:32:16] It's a call to the accounting industry to stop ignoring auditing the health plans because that is a place where these overcharges are happening.

[00:32:25] It takes every one of us to fight like Marshall Allen, never pay the first bill, but to make sure the bill is accurate.

[00:32:32] This is a revolution, and it's going to take the early adopters to lead it.

[00:32:38] And it's a time whose moment has come because we are in crisis.

[00:32:42] I think that crisis is the input for substantial change, which is just common sense.

[00:32:49] And that's really to have a transparency and a functional and competitive market in healthcare.

[00:32:54] I think there's going to be revolutionaries that are going to disrupt it and blow it all up.

[00:32:58] And why not?

[00:32:59] Why not have one price like we did for our cord blood banking service?

[00:33:04] One price, one patient, all patients.

[00:33:06] Have it be a cash price.

[00:33:08] Insurance can reimburse the cash price.

[00:33:10] And it's fair.

[00:33:11] It's equitable.

[00:33:13] And there's profit made for the provider for that service.

[00:33:18] And the insurance carrier can do like they do in property and casually, is just have a fee, a small fee or a transaction fee.

[00:33:28] Let Visa and MasterCard and American Express take over these networks.

[00:33:32] They're used to a 3% to 5% fee.

[00:33:34] I think any employer would be happy to pay them 10% to 15% all in on whatever that provider charges.

[00:33:40] And let's just blow it all up because it's fair.

[00:33:43] And that's the holy grail is to have an accountable healthcare system.

[00:33:50] Patientrightsadvocate.org.

[00:33:51] For more information, Cynthia Fisher, thank you so much for being on Relentless Health Value today.

[00:33:55] Thank you, Stacey, for the opportunity.

[00:33:58] Hi, this is Cora Upsall with the 32BJ Health Fund.

[00:34:01] If you love Relentless Health Value, just like I do, then I would encourage you, please sign up for the newsletter.

[00:34:07] Follow on your podcast app and leave a review.

[00:34:10] Tell everyone else about how great this is and all that you're learning.