EP523: The Sleeping Giants of Healthcare—Why Self-insured Employers and Clinicians Keep Missing Each Other, With Suhas Gondi, MD, MBA

[00:00:00] Episode 523, The Sleeping Giants of Healthcare, Why Self-insured Employers and Clinicians Keep Missing Each Other. Today I speak with Dr. Suhas Gandhi. American healthcare entrepreneurs and executives you want to know, talking, relentlessly seeking value.

[00:00:29] Hello, all you Relentless Tribe members. Before we dive in today, I just wanted to give a quick but massive thank you to Dr. Alex Summers from Astia Health for his generous gift, which we are going to use to help fund a camera for the podcast here to level up our video game. We're trying to do some video. It may or may not be going so well so far. Check us out on Spotify or YouTube and yeah, judge for yourself.

[00:00:59] I was absolutely fascinated by a recent article in the New England Journal of Medicine written by today's guest, Dr. Suhas Gondi. Put a link in the show notes. The article is entitled, A Sleeping Giant of Healthcare Affordability, Self-Insured Employers. Now, Dr. Gandhi wrote this article with his co-author, Dr. Ziri Sang, for doctors.

[00:01:28] And one of the reasons he told me he wrote it is because, let's face it, a lot of doctors do not listen to this podcast. And it seems that many physicians are largely actually unaware that there is a self-insured employer or other plan sponsor that sits behind that carrier ASO or network card with some big carrier's name on it that the patient walks into the clinic with.

[00:01:54] And I don't know, maybe this is unsurprising because for decades people have referred to employers as Ava mentioned, the sleeping giant. Three points for whoever came up with that nickname. If so many physicians and or New England Journal of Medicine readers are in fact unaware, warranting an article that again, it's not the carrier or the payer who many times with private insurance was paying the bill. Hi, this is Arielle Bowes.

[00:02:23] I've reflected on this a great deal and honestly feel that listening to Relentless Health Value has given me more actionable insight than I could ever hope to receive from another graduate degree. And it cost me absolutely nothing to listen and learn. If you want career growth in healthcare or insurance, this is the pod you need to be listening to. The conversation continues online. Follow Relentless Health Value on LinkedIn to join the community and share your own perspective.

[00:02:51] But here's another possible sleeping giant, and I know I'm going to get some heat for saying this. Physicians. And I know many doctors will immediately be offended by being called a sleeping giant and touche because most employers are too. And fair enough, really, for both parties. First, speaking on behalf of employers, listen to the show with Lauren Vela for a whole bunch of great reasons for employer inertia, as they call it.

[00:03:20] One of them is many employer teams in charge of the health plan actually have a day job, which is not running a health plan off the side of their desks, which actually kind of runs parallel to what many doctors or other clinicians would say. Every clinician also has a day job that might not be patient financials and access barriers.

[00:03:43] And it's also called med school, not deal with the financial fallout from a whole lot of compounding policy and coverage decisions that turned out to be not so great for patients. School. And look, employers and physicians both share actually another similarity. There are many in both groups who are very, very dissatisfied by current status quo goings on for different but complementary reasons. So there's a lot of parallels here.

[00:04:13] And sort of in all of them, I am spying in a weird way. The compliment, frankly, the sleeping giant term recognizes the latent power for both employers and clinicians slash physicians alike. Dr. Lisa Rosenbaum put it this way. She said that if we all blame all of our problems on some kind of like intractable, inevitable structural constraints, we lose our own agency.

[00:04:40] How interesting would it be if both the ultimate purchasers and the ultimate purveyors of health care arose and started really trying to figure out how to work together at scale? This general theme has already started with some of the advanced primary care stuff that's going on.

[00:04:58] Listen to the episode with Patrick Nellie or the myriad of shows about direct contracting between doctor practices, physician led practices and employers compressing again the distance between the ultimate purchasers, the ones actually shelling out the shackle for the care and clinicians actually buying health care in a very awake fashion.

[00:05:21] My guest today, Dr. Suhas Gandhi, recently finished his internal medicine residency at Brigham and Women's Hospital in Boston. And Dr. Gandhi is currently an attending physician at Mass General. Additionally, he serves as chief medical officer at Health Strategy, an independent pharmacy benefits consulting firm. My name is Stacey Richter. This is Relentless Health Value. This podcast is sponsored by Aventria Health Group.

[00:05:46] I also want to thank Payerset, who is our series underwriter in 2026. And I also very, very much would like to thank Patient Rights Advocate, who gave us a super nice donation to help further our work around here. Thank you so much also to everyone who has offered up some financial support. We really appreciate it. It actually is weirdly expensive to keep this podcast running and as ad free as we possibly can make it.

[00:06:14] So the financial support is super appreciated. Thank you so much. And here is my conversation with Dr. Suhas Gandhi. Dr. Suhas Gandhi, welcome to Relentless Health Value. Stacey, thank you so much for having me. Well, it is such a pleasure to have you back on the podcast.

[00:06:31] You wrote an article that is entitled, with your co-author, A Sleeping Giant of Healthcare Affordability, Self-Insured Employers, which I'm going to say most Relentless Health Value listeners right now are thinking to themselves, wait, this is a revelation? It is a very stair question. And I appreciate the opportunity to give some context.

[00:06:57] First, I do want to acknowledge my co-author, Ziri Sang, who's a longtime collaborator and mentor and an avid listener of this podcast. The reason Zuri and I wrote this article is because clinicians who are the primary audience for the New England Journal have a quite limited understanding, we think, of the role of employers in the healthcare system. So that was really the motivation.

[00:07:25] We have found over time that clinicians and employers are often kind of talking past each other and patients are getting lost in the middle. If I'm just going to distill down what your average clinician doctor believes is going on here, we're talking about commercial insurance and those covered by commercial insurance, which is 60, 50, 60, depending on who you ask, percentage of the country.

[00:07:53] And for large employers, I think almost three quarters of them are self-insured. If I just said to your average doctor, what's going on there? What do you think your average doctor would reply? I think the baseline understanding, and it's always hard in the same way it's difficult to paint employers with a broad brush. It's also hard to paint clinicians with a broad brush.

[00:08:16] But I would say on average, I think most clinicians would say it doesn't matter where my patient is employed. That might be an interesting tidbit for my social history when I'm interviewing the patient, but it is not a material influence on their health and on their healthcare, nor on my ability to serve them. Because they have united. Because they, exactly, they're insured, right?

[00:08:44] They have private insurance, and that's great. Like, I know some patients have Medicare, I know some have Medicaid, and the others have private insurance. But who actually employs them, right, and sponsors their health insurance, to your point about most large employers being self-insured, is not really an input that I, as the clinician, am thinking about. And in some cases, they're not even aware that it could really affect my ability to care for them. Physicians are obviously incredibly smart individuals.

[00:09:11] If they sat down and really thought about it, they'd probably be thinking to themselves, wait a second, United, how can United be paying the bill like somebody, right? Like, you'd start to ask a bunch of questions. Absolutely. And it's such a great point. The affordability of care has become such a prominent issue in our healthcare system.

[00:09:33] And the folks who are on the hook at the end of the day is usually a self-insured employer. So whereas traditionally they may have been sleeping giants, to use that moniker, many of them have woken up.

[00:09:51] And the decisions that they are making about coverage, take GLP-1s as an example, absolutely do matter in the clinic and in the office visit with the clinician. And I do think that is starting to change. I alluded to GLP-1s earlier.

[00:10:10] Over the last few years, the disparity between those employers who are covering GLP-1s for weight loss and those who are not has become sort of a focal issue in the affordability fight in healthcare. And employees who are seeking those medications, I think, have come to realize over the last 12 to 24 months that, oh, this is not my doctor's office. This is not the health plan.

[00:10:40] This is, I have to talk to HR. And that is a sort of convoluted aspect of our system that you have to go to the person who employs you and who, you know, writes your paycheck to get care that your doctor thinks is important for you. But it is how healthcare works for most people in America. So you mentioned the sleeping giant of employers.

[00:11:05] Given the understanding that physicians a lot of times have, just, you know, just stating, certainly not talking about everyone, certainly definitely not talking about any doctors that listen to this podcast, but just in general, as you said.

[00:11:19] You also could say, you know, physicians are a sleeping giant as well, frankly, that if physicians really start to understand and take some of their power, and probably doctors listening are going to have the same visceral reaction to being called the sleeping giant as most employers have. So I guess, fair enough on both sides. But there probably is benefit if both sleeping giants wake up to be able to be a vice grip.

[00:11:48] You know, you've got the ultimate purchaser on one side of the house, and then you've got the ultimate deliverer of care, right, on the other side. If both are wide awake, that certainly you would think could have massive impact on the ability of those in the middle to take advantage of either party. Yeah, no, absolutely.

[00:12:10] And I should say that I think the sleeping giants, this sort of title is meant to be somewhat provocative and is also a reference to, I think, the traditional setup, right?

[00:12:23] And a status quo that I think has really been upended over the past five years or so, partly due to GOP wongs, partly just due to the affordability issues more broadly, and partly due to the work that you and others like Mark Cuban have done to illuminate some of those inefficiencies that happen and how some of those middlemen and vendors and delegated entities can take advantage of self-insured employers.

[00:12:49] I also totally agree with you that both sides, the clinicians who are taking care of patients and who are the ones who order the services and write the scripts for drugs,

[00:13:02] and the employers who are faced with just dramatic financial pressure and are being forced to make trade-offs between wanting to cover amazing innovations and the premiums that would have to go up to finance that,

[00:13:24] the deductibles and increased cost sharing that might have to go up to finance that, and frankly, the wage growth that could otherwise be financed with those dollars. I think both of those sides would benefit from better understanding the others' perspective.

[00:13:41] And if for no other reason than hoping that the members of those plans and the patients of those clinicians don't bear the brunt of the systemic dysfunction, which unfortunately is too often the case in our healthcare system. Yeah, and to your exact point, I appreciate that you said that. If we consider that there's, generally speaking, 30% of U.S. healthcare is considered waste, it's considered just this Franken-machine.

[00:14:09] Like somebody does something, you have action-reaction, and then before you know it, you've got 16 layers of admin. If you have the beginning, the ultimate purchaser, and you've got the deliverer, ultimate deliverer of care working together, you probably could get rid of a lot of costs and actually fund high-value care as opposed to funding a lot of dysfunction in the middle. What I want to talk about is a kind of a case study. And it just reminds me of this like Mars versus Venus.

[00:14:38] I don't know, like you read sometimes these therapy scenarios, the magazine that's like sitting on the table somewhere that you like wind up picking up. If we go through the GLP-1 example, let's go through sort of a step-by-step. So doctor writes a GLP-1. Let's start there. What's the doctor thinking? Yeah. So let's say the clinician has a patient with obesity and cardiovascular disease.

[00:15:05] And after shared decision-making and counseling with that patient, physician decides that patient might benefit from a GLP-1, goes through all those risks and side effects, and together they come to a decision that WGOVI might be the right fit for that patient. And it is amazing that we have a medication for those conditions, whereas in the past, we historically have not before GLP-1s. Let's take the example of a physician who actually is very well-versed in a lot of what we have discussed.

[00:15:35] The physician actually suggests that the patient go check to make sure that their employer-sponsored insurance plan covers WGOVI. And the patient also, we're going to take the example of a patient that is super well-educated on the system, right? And they check with their employer plan, and it does. Great. So clinician prescribes WGOVI, goes to the patient's desired pharmacy, their local CVS or Walgreens, for instance.

[00:16:01] They address all of the prior authorization criteria through the clinic's standard workflows, right? This is a really hot, well-operating system where they've learned how to do this, and they're going through all the right processing. But then the patient goes to the pharmacy and learns from the pharmacist that the claim was denied, and their out-of-pocket price is the list price of the drug.

[00:16:21] So the patient, who is frustrated and understandably upset because they took the extra step to confirm coverage first, decides not to fill the prescription because of the exorbitant out-of-pocket cost. Yeah. So just to kind of reiterate our step one here, like this is what happens when you've got two giants who aren't communicating. And to your exact point, and you know, maybe that patient had type 2 diabetes also. So let's just throw that into the mix.

[00:16:49] But they go to the pharmacy to pick up their GLP-1 script, and it's denied. It's not there. They're told that the copay is whatever it is, hundreds of dollars. And, you know, just adding to this, you hear often enough that a lot of times the pharmacies themselves are underwater on GLP-1 scripts. Now you're asking the pharmacy to process a lot of paperwork and spend a lot of time to fill a script that they're losing money on. Right?

[00:17:17] Like it's just very dysfunctional on its face, but that's probably a whole story for another day. All right. But now you've got a patient running around who has a clinical need. I mean, they and their doctor decided that they had a clinical need for this product, and they don't have a med. So everybody's, well, the doctor doesn't even know it at this point. You've got the patient, though, who's just like, oh, what happens next? Well, I mean, it's a great point. Sometimes the clinician doesn't even know that happened, right?

[00:17:47] There's no feedback, right, from that pharmacy about that claims denial to that clinician and to their office. And so often it's not until the next follow-up. Oftentimes when you prescribe a GLP-1, you'll want to put a follow-up visit on the books to make sure that they're tolerating the side effects well and that they can titrate up to the maximum tolerated dose. So oftentimes the clinician won't even realize this happened until the three-month follow-up.

[00:18:13] And now the clinician is upset and frustrated because, just like the patient, they also feel like they did everything right with regard to ensuring coverage, to doing the PA and submitting it, and verifying the patient's preferred pharmacy.

[00:18:26] In this hypothetical scenario, what the clinician doesn't realize is that the employer does cover Wagovi, but recently decided to do so only in the context of a third-party vendor that also provides health coaching and lifestyle management and clinical services to wrap around the GLP-1. And that vendor is the sole covered prescriber under the plan. This is a choice that some employers have made over the last year.

[00:18:52] And if you then go to the employer's perspective, the employer is thinking, wow, we did a great thing. We made the difficult decision to continue offering coverage, even while many of our peers decided to terminate it. But because we have seen that the costs are out of control in this category, and we've seen some inappropriate prescribing in our claims,

[00:19:17] we wanted to partner with a vendor to ensure that the prescribing is appropriate, that the medicine is evidence-based. And by the way, we're also paying for additional services like the health coaching and nutritional counseling on top of that. But they're not getting credit for that with the employee or the clinician due to this communication gap. Yeah. And just speaking from the standpoint of the employer now, the self-insured employer who's picking up the tab for all of this,

[00:19:43] just in case there's any clinicians listening potentially who are unfamiliar. You have GLP-1 spend single-handedly increasing the pharmacy costs of any given plan 9%, 12%. I heard 20% in one case. You actually have the cost of these meds literally bankrupting plans. All of a sudden, covering health care benefits is already the second biggest line item after payroll for most employers.

[00:20:12] It's going to go up 20%? It's unsustainable. It's very unsustainable. So the other bit of this is that it's also very well known by most employer, most not sleeping employers, that the adherence rate of GLP-1s, like the most expensive med, is the med a patient takes for a month and a half. It's supposed to be chronic and then they stop, right? Like they're going to gain the weight back.

[00:20:37] So like how you prevent that and the ROI, there's been ROI calculations. If they're successful, it's like eight years or something like that for ROI. So it's definitely not going to have any ROI if the patient takes this med for 10 minutes and then stops taking it or a month or three months or whatever the average adherence is. So they know that they have to wrap around nutritional counseling.

[00:21:00] They have to wrap around a lot of the support mechanisms that you had just mentioned. So therefore, they get a vendor to do that. But to your exact point, okay, so here's you've got this employer who's trying to figure out how to get this to their employees. If it's not affordable, premiums are going to wind up going up. But if nobody knows that, now we've got this situation where everybody's mad. For the employer, the dollars have to come from somewhere.

[00:21:27] And oftentimes it's from their employees. It's from the working families of America who are seeing premiums and deductibles grow faster than their earnings are. And that's because of how much we're spending here. And so it's a very reasonable response from the employer to want to ensure that the dollars that they're spending on GLP-1s are high value and that they're going to lead to long-term health benefits for those patients.

[00:21:57] But it introduces an additional layer of complexity that is sometimes the layer that even when you're covering the drug, the member and the clinician can get lost in. And it's a nice example of how I think both entities feel like they're doing the right things. And in many cases, they are. But still, the member gets lost. And by the way, we've now kind of walked into my day job and what Dr. Gandhi was just talking about.

[00:22:25] We see all the time that people somehow think that there's some magical walkie-talkie between what's going on at the pharmacy counter or whatnot and the clinical team. You know, the information superhighway, sad to say, doesn't automatically carry these things efficiently at all. And most of the time, nobody's got any idea over on the prescribing side of the house what just happened. Give me another example.

[00:22:52] Yeah, we'll take a second example from the oncology space. Let's take the hypothetical example of a member who unfortunately has a new diagnosis of cancer and is getting world-class cancer care from an oncologist at a brand name institute attached to a large academic health system. The oncologist and the patient decide together on a treatment plan.

[00:23:17] But they receive word that the PA was denied. And of course, both are frustrated and can't really fathom why coverage was denied for the first-line therapy for their condition. And unfortunately, what they might not appreciate is the employer's perspective here, which is not that they don't want their members to receive guideline-recommended cancer care.

[00:23:42] It's actually just that they don't want to pay a 40% premium for the administration of the same drug because it's being administered in a hospital-owned infusion center, as opposed to in a physician office or at home where many of these drugs can be administered safely. And so they've adjusted their clinical criteria to steer folks towards those more cost-effective sites of care. Now, for the employer, that's a no-brainer.

[00:24:10] But for the member in the clinician, they don't always have visibility into that. I mean, imagine being the doctor in the office. How can you possibly keep track of where your patients are employed and which employers have implemented set-of-care programs or lifestyle management vendors or change their policies? This doesn't even mention how limited visibility prescribers have into the costs downstream of their orders in Epic.

[00:24:34] It's almost another layer of, oh, the cost for the same drug in administration varies depending on where it's administered. It's not hard to see how this gap between the understanding of their clinicians and the employers can lead to, again, this situation where employer feels like they're doing the right thing, they're covering the drug, right? And they're figuring out how to finance it. They're just trying to do it in a cost-effective manner for their plan. And clinician is just trying to get the right care to the right patient at the right time.

[00:25:04] And again, they're coming into friction because they don't understand one another. Listen to the show with Sarah Eamon. Like GLP-1s, they are actually a medical miracle in many ways, as are these immunotherapies, infused immunotherapies. But the cost is staggering. Layer on, listen to the show with Ivana Krejcinovich, where she gives an example of how if two members had gone down the street to get an infusion, it would have cost the plan $1 million less.

[00:25:33] $1 million. This is the same med, like literally, literally the same med. It costs $1 million less if a patient goes down the street. You can't run a plan and have $1 million here, $1 million there spent just on a higher price. So in the example that you're giving, doctor writes a med, and it's denied not because the med is denied, but because the site of care is wrong.

[00:26:02] And if you have physicians who don't quite get what's happening here, like sure with the drug, but not at your own facility, which might be $1 million more, like this patient's got to go someplace else. And the patient's like, hmm. There are dozens of permutations of what could be the driver of that denial and what the remedy is. And all too often, we're just met with frustration.

[00:26:31] And we're met with the burden being placed on the member and their family and their caregivers at the worst possible time. For them to have to take that burden and be sitting on the phone and, you know, be trying to advocate for themselves in a system that makes it very challenging to do that. This is why it's so important with site of care that you have a really good navigator listening to the show with Matt McQuad, right?

[00:26:55] And in that last case, I mean, I can seriously imagine there's not going to be very many that you listen to that epic show on Acquired. I am talking right now about a podcast called Acquired that did an episode that is actually several hours long all about epic. The one thing that was very clear that epic fully understands is where their bread is buttered, which is with hospital administration. That's that's their customer. They regard that as their customer.

[00:27:25] It's like I if I recall correctly, it's like on their bathroom stalls. Like you go in the bathroom and it says think of the customer, the hospital administration. Right. So like you think that epic is going to put something in their EHR that says I have to go find out what the right side of care is because it might not be here. Like let's program a network leakage, which is what a hospital system calls it when a patient goes out of their network or their hospital network to get care someplace else. No, absolutely.

[00:27:52] The electronic medical records are billing instruments that were designed to optimize profit for their customers who are the providers. Right. The health systems, they're not necessarily designed at all for the clinician, for the member or for the plant sponsor. Or for affordability. That is not it's probably not written on the inside of anyone's bathroom stall in any of these places. Unfortunately, it should be, though.

[00:28:20] So as we think about how we are using this information, I mean, I feel like just the fact that there is communication. Communication leads to collaboration because you understand where other people are coming from. Anytime an unknown unknown becomes a known unknown, friction can disappear.

[00:28:42] Right. But as you're thinking through everything that we're talking about here, what's your advice for, let's just say, clinicians? Yeah, I think it starts with increased awareness. I think clinicians need to better understand employers, both with regard to just the sheer magnitude of the role that they play in the health care system.

[00:29:08] And more specifically, to the set of tradeoffs that they are faced with when they are trying to manage their plan. I think that leads to increased understanding of some of these measures that are taken by the employers that are sometimes experienced as barriers or as friction by the providers and members.

[00:29:35] And that then leads to this vicious cycle, right, where we all feel like we're in this world where the clinicians feel like insurance is denying care left and right. And employers have growing skepticism that the clinicians are just trying to make money and make decisions that lead to overspending. And ultimately, nobody is the wiser and the patient, the most vulnerable party in all of it is responsible for helping each side understand the other, which is something that even experts would have a hard time doing.

[00:30:03] So I think it really starts with increased awareness, understanding the role that employers play and the set of tradeoffs that they're grappling with. That's why we wrote that No One Journal article. And I think that's a starting point. I also think that employers with local presences can better engage with local providers and prescribers. And of course, vice versa as well, right?

[00:30:31] I think that's a local health system with a large density in an area, I think should engage more with the large employers that are in that locality, potentially through the assistance of their TPAs or their PDMs or independent of that, especially when it comes to big changes around coverage to help prevent that friction that might otherwise occur.

[00:30:55] You could imagine, for instance, in our GLP-1 scenario, if the employer, when they made the decision to go to that full prescriber setup with their vendor, which was one of the measures that in their assessment would bend the cost curve for them while still being able to provide GLP-1 coverage for weight loss.

[00:31:18] If that was communicated to the primary care office in that community, that would then help prevent that friction that we fell into. Because right now, you've got the employer communicating that to the plan and to the members, but not to the prescriber who's actually the one who's helping make that decision about GOP-1s. And I think that's a gap that we can solve.

[00:31:45] Okay, gang, this right here is my day job. Like, literally, my actual day job is bridging this communication gap. Not for everything, but in certain use cases, mostly involving scenarios where clinicians don't realize patients may be failing to get their medications.

[00:32:09] So if you just heard this and thought to yourself, oh, wow, I just spent last week dealing with the fallout of this exact problem. Sure. Call me. Yeah, so you said two things there. You said, number one, increased awareness. Just really understanding who's paying.

[00:32:25] You have a majority of those with commercial insurance, private insurance, have coverage through their self-insured employer and may have more power than is evident. That may open up avenues for counseling a member, for example. Like, it might be better to talk to HR and there's going to be HR people listening who are about ready to kill me right now. But just this overarching awareness, number one.

[00:32:54] And then number two, you know, takes two to tango here, right? If you have clinical organizations that you know your members are going to, like, sure, you could talk about direct contracting, but you also could just talk. And I have heard so many learnings, let's just say, that are very, very actionable that a self-insured employer learns when having a conversation with, for example, primary care physicians in the area.

[00:33:22] Yeah, there's lots that comes to light if those conversations actually happen. Absolutely. I mean, don't let the presence of middlemen between the two entities prevent even communication between the two. And I'm not saying you have to go all the way towards direct contracts, though. Which you could. You could, though. Absolutely. It's something you've discussed on the podcast before. And in some cases, they might make sense.

[00:33:50] They don't make sense in all cases, given the complexity around it. But I think the greater communication that thought that, oh, we're making a big change to plan coverage. We need to tell, in the GOP-1 case, our PBM. We probably need to tell our health plan or medical benefit pharmacy benefit vendors. We need to tell our management team. Add to that list.

[00:34:14] We also need to tell our local provider partners to take care of the lion's share of our beneficiaries. Dr. Suhas Gandhi, if someone is interested in learning more about you and your work, where would you direct them? My LinkedIn. And we also have a website at Health Strategy where with some more information, would love to get in touch and learn how I and we can help. We will put links in the show notes.

[00:34:42] Dr. Sue Asgandi, thank you so much for being on Relentless Health Value today. Thank you so much. Hi, this is Dr. Kristen Dickerson. I was so excited to be a guest on my favorite podcast. Stacey not only unearths and distills the problems with the existing healthcare system, she also offers hope for a better future for healthcare and for restoring trust in the system. If you rely on this podcast as much as I do, please sign up for the RHV newsletter to stay informed.