Relentless Health Value tribe, in this conversation that follows with Dr. Mick Connors, I had a barnstormer of a revelation—one I have never heard anyone talk about before … like, ever. It's a major fundamental bottom line, though, about the U.S. healthcare system—an insight that, once you see it, you kind of can't unsee it.
For a full transcript of this episode, click here.
If you enjoy this podcast, be sure to subscribe to the free weekly newsletter to be a member of the Relentless Tribe.
And don't get me wrong, why this revelation is true, why it is, in fact, the case will shock no one. But yeah, we'll get to that after I drag out the suspense just a little bit longer.
Okay … so, we, the Relentless Health Value tribe, are committed to fixing healthcare and putting patients over profits. We want to find a way forward to manage a $4.9 trillion sector such that we raise the value of services delivered—meaning reduce or at least hold costs static while the outcomes or the health gains or whatever you wanna call what the patient gets from the spend is realized. The typical formula is outcomes divided by cost equals value.
Okay … so, let's think about how we measure cost or what we know about cost. And then let's think about how we measure outcomes or what we know about outcomes. And I'm picturing Willy Wonka right now, the Gene Wilder version, when he says, "So much time, so little to see. Oh, wait a minute. Strike that. Reverse it."
Here's the deal: In American healthcare, we currently measure costs at a macro aggregate level. Most of the time, no one knows what it costs to deliver any given individual service. There is no or little effort at unit cost accounting. Steve Schutzer, MD, talked about this in an episode (EP294) a few years ago.
So, that's half of this revelation and undeniably a problem, one of which many of you are probably fully aware of already but just right. Like, if you are running any other business and you encounter, like, any of the sharks from Shark Tank and you cannot tell them the unit cost accounting—like, you don't know what your cost of goods are—the financial discipline buzzer is gonna be going off like a fire alarm.
But again, I could probably fit around my kitchen table—and I'm exaggerating for dramatic effect, of course, but I might not be far off—like, I could fit around my kitchen table the number of folks who probably could tell me with any degree of fidelity what the cost of service and cost of goods are for spine surgery or pick any other procedure.
But if we can't, we essentially have no financial discipline on the cost side because if it's unclear what the unit cost of anything is, that is a requirement for fiscal discipline. So, therefore, you can't have it if you don't have one of the biggest rate criticals.
All right, so now let's flip over to the quality side. We track quality, and sometimes we even use the term patient outcomes in this context, but we track it to the tenth of a percentage point using extremely specific, narrow (for example, HEDIS) measures like A1C or BP control. But on this side of the house, what do patients actually want?
They want whole-person health. They want better community health, better population health. But at these rollups (whole-person health, better community health, better population health), these things are measured by very few, at least with teeth. Kenny Cole, MD, talked about this actually in the episode (EP431) with him.
Health gains arise when all of the risk factors are reduced in tandem, not just one of them. And along those lines, if you listen to patients complain about the health system, once they move on from the cost of their latest doctor visit, you will next hear a long story about how some catastrophe is afoot because their cardiologist won't talk to the ortho guy who said he can't do the procedure until the blood thinners are whatever, and then they can't get the Rx for their inhaler.
That is not whole-person care. And it's gonna be a problem on the quick for the patient, for their family, for the community. You see the misalignment. We measure costs in the aggregate, but we measure "outcomes" at the service level.
So, here's the revelation: We've gotta flip it, like, Willy Wonka style. We need to measure costs at the unit level. We need to measure health and outcomes at the whole-person, whole-community, whole-population level.
It is fundamentally problematic to talk about our financial woes at the hands of the healthcare sector when prices are rising every year if no one knows how much the service costs to produce, and it's disingenuous, frankly, to talk about amazing HEDIS scores when a community is dying young.
To say no margin, no mission with the integrity, really, that that statement demands, we gotta be doing cost accounting at the unit level and measuring outcomes at the patient and community level.
And that is how this whole conversation with Dr. Mick Connors started out, by the way, as a continuation of the No Margin, No Mission series. But yeah, it went off the rails in like T minus five minutes and became how do we create value in healthcare versus margin that gets siphoned off the top.
Today my guest is Dr. Mick Connors, who is, by training, an ER (emergency room) pediatrician. His passion has always been how to get all kids better care. Besides working in emergency rooms, Dr. Connors also worked at for-profit institutions and started a telemedicine company. So, he has lots of angles to look at all of this through. I love this conversation.
This episode is sponsored by Payerset and Aventria Health Group.
Payerset is a price transparency company with a mission to create fair and equitable healthcare for everyone. Love that. Payerset empowers healthcare organizations, employers, and patients with the most complete set of healthcare price transparency data. They benchmark every negotiated rate and claim and deliver the insights needed for smarter contract negotiations and a more transparent healthcare system.
Also mentioned in this episode are Steve Schutzer, MD; Kenny Cole, MD; Payerset; Aventria Health Group; Shane Cerone; Sam Flanders, MD; Andrew Tsang; Suhas Gondi, MD, MBA; Vivian Ho, PhD; Preston Alexander; Yashaswini Singh, PhD; Rebecca Etz, PhD; The Larry A. Green Center; Tom X. Lee, MD; and Rushika Fernandopulle, MD.
For a list of healthcare industry acronyms and terms that may be unfamiliar to you, click here.
You can learn more at Transforming Pediatrics and What the Doctor Sees newsletters and follow Dr. Connors on LinkedIn.
Mick Connors, MD, is a physician, entrepreneur, and healthcare leader whose career spans the clinical front lines, executive leadership, and entrepreneurial innovation. With more than two decades of experience, he has lived on both the clinical and business sides of medicine, gaining a unique perspective on how to align mission, margin, and care delivery.
Compelled to enter medicine after the loss of his brother to childhood cancer, Dr. Connors has built his career around advancing models of care that improve outcomes for children while reducing cost and complexity. He has led teams in hospital settings, guided new business divisions, launched technology-enabled companies, and advised organizations seeking to adapt in a rapidly changing healthcare environment.
His professional journey reflects a wide diversity of roles: treating patients as a pediatric emergency physician, building entrepreneurial ventures from the ground up, and shaping strategy at the board level. This breadth of experience has allowed him to see healthcare from multiple vantage points: the bedside, the executive suite, and the startup world.
Dr. Connors is passionate about reimagining the value equation in healthcare: helping systems deliver higher-quality care at lower cost while remaining true to their mission. He believes strongly in the medical home and continuity of care, and he is known for bringing vision, structure, and sustainable solutions to the challenges facing modern medicine.
At his core, Dr. Connors thrives on building teams, challenging the status quo, and fostering trust—qualities that define his approach to innovation and leadership across the healthcare landscape.
06:32 How Dr. Mick Connors defines margin.
08:18 EP294 with Steve Schutzer, MD.
08:54 Why nobody wants to do cost accounting in healthcare.
09:20 EP490 with Shane Cerone and Sam Flanders, MD.
11:05 Infographic by Andrew Tsang showing streams of income.
12:27 What is the value equation?
15:55 EP404 with Suhas Gondi, MD, MBA.
15:59 EP466 with Vivian Ho, PhD.
16:01 EP482 with Preston Alexander.
16:25 EP474 with Yashaswini Singh, PhD.
17:44 How business decisions can really undermine the value proposition.
18:58 Classic article on incentivizing.
23:07 EP295 with Rebecca Etz, PhD.
24:21 Why it comes down to the 80/20 rule.
26:31 EP445 with Tom X. Lee, MD.
26:35 EP460 with Rushika Fernandopulle, MD.
26:40 Why mission return requires dyad leadership.
27:13 What does dyad leadership mean?
27:33 EP492 with Sam Flanders, MD, and Shane Cerone.
Recent past interviews:
Click a guest's name for their latest RHV episode!
Sarah Emond (EP494), Sarah Emond (Bonus Episode), Stacey Richter (INBW43), Olivia Ross (Take Two: EP240), John Quinn, Dr Sam Flanders and Shane Cerone (EP492), Elizabeth Mitchell (EP491), Shane Cerone and Dr Sam Flanders (Part 1), Dan Greenleaf (Part 2), Dan Greenleaf (Part 1)