WEBVTT - Revealing How Much Health Care Really Costs 0:00:15.316 --> 0:00:22.876 Pushkin. Imagine you're going to buy a car. You go 0:00:22.916 --> 0:00:25.316 to the lot, you test drive the car, You tell 0:00:25.356 --> 0:00:27.796 the sales guy I like it, I want to buy it. 0:00:28.436 --> 0:00:31.836 And the sales guy says, go ahead, drive away. Car 0:00:31.916 --> 0:00:35.196 is yours and you say, okay, great, But how much 0:00:35.236 --> 0:00:37.996 is this car going to cost? And the sales guy goes, 0:00:38.556 --> 0:00:41.756 I don't know. I can't tell you. Maybe it's twenty 0:00:41.796 --> 0:00:45.596 thousand dollars, maybe it's thirty thousand dollars, maybe it's forty. 0:00:46.076 --> 0:00:47.956 We'll send you a bill in like a month when 0:00:47.996 --> 0:00:51.236 we figure it out. This is obviously absurd. It's not 0:00:51.276 --> 0:00:53.956 the way buying a car works, but it is a 0:00:54.076 --> 0:00:55.996 lot like the way it works when you go to 0:00:56.036 --> 0:00:59.956 the hospital for say, surgery. Nobody can tell you in 0:00:59.996 --> 0:01:02.876 advance exactly how much it's going to cost, and then 0:01:03.036 --> 0:01:05.556 a month later, when you don't have any painkillers left 0:01:05.556 --> 0:01:13.796 to blunt the impact, you get the bill. Surprise. I'm 0:01:13.876 --> 0:01:16.796 Jacob Goldstein, and this is what's your problem. My guest 0:01:16.796 --> 0:01:19.916 today is Chris Severn, the co founder and CEO of 0:01:19.996 --> 0:01:23.636 Turquoise Health. Chris's problem is this, how do you make 0:01:23.716 --> 0:01:30.196 healthcare prices transparent, not just for consumers, but for hospitals, insurers, businesses, 0:01:30.596 --> 0:01:33.876 for everybody. People have been trying to solve this problem 0:01:33.876 --> 0:01:36.316 for decades, but there's a good reason to think that 0:01:36.396 --> 0:01:40.756 this time really is different. In twenty nineteen, the federal 0:01:40.796 --> 0:01:44.916 government issued a new rule. This rule said insurers and 0:01:45.036 --> 0:01:48.836 hospitals are going to have to publish their prices, not 0:01:48.876 --> 0:01:52.396 just the fake list prices that nobody pays, but the actual, 0:01:52.676 --> 0:01:57.316 real negotiated prices. This rule is just starting to take effect, 0:01:57.836 --> 0:02:00.396 and Chris says it's impact in the long run could 0:02:00.476 --> 0:02:05.956 be huge. So it's a pretty simple story. You know, 0:02:06.996 --> 0:02:12.396 before twenty nineteen, the true price of healthcare was unknown 0:02:12.676 --> 0:02:16.796 to anybody who wasn't privy to these contracts negotiated between 0:02:16.836 --> 0:02:19.956 insurance companies and hospitals. And this is a this is 0:02:19.996 --> 0:02:23.836 an insane fact. Oh insane. I mean, it's obviously true. 0:02:23.836 --> 0:02:25.276 If you're a patient and you're going to go and 0:02:25.316 --> 0:02:26.596 they can't tell you, is it going to cost a 0:02:26.636 --> 0:02:29.276 thousand dollars? It could cost five thousand, they can't tell you. 0:02:29.476 --> 0:02:33.036 But like one hospital didn't know what another hospital was charging, 0:02:33.356 --> 0:02:37.716 different insurers getting wildly different rates, like just a weird, weird, 0:02:37.956 --> 0:02:41.676 huge money world, exactly, And it is crazy. And that's 0:02:41.676 --> 0:02:44.996 the world that sort of I professionally grew up in 0:02:45.116 --> 0:02:47.316 for ten years and we were just used to it. 0:02:47.356 --> 0:02:50.116 You know, these secret PDF contracts that were protected as 0:02:50.396 --> 0:02:52.756 trade secrets could not be disclosed. There were these things 0:02:52.796 --> 0:02:54.796 called gag clauses. When you say you grew up and 0:02:54.796 --> 0:02:59.196 you were a consultant for hospital billing, basically, right, exactly exactly, 0:02:59.436 --> 0:03:02.556 And you know, there's an interesting nugget in ACA that 0:03:02.716 --> 0:03:08.276 required hospitals to disclose their standard charges was the word okay, 0:03:08.316 --> 0:03:11.636 And it was basically the Obamacare law that was passed 0:03:11.876 --> 0:03:14.516 more than ten years ago, now right, yep. And nothing 0:03:14.556 --> 0:03:17.276 really happened with that for a while, and then legislators 0:03:17.276 --> 0:03:20.876 started turning attention and rulemakers started turning attention to it, saying, hey, 0:03:21.236 --> 0:03:23.556 we really need to get the prices of healthcare out there. 0:03:24.036 --> 0:03:26.796 We're going to and this came through the Trump executive 0:03:26.876 --> 0:03:29.516 orders in twenty nineteen. There were a few of them. 0:03:29.676 --> 0:03:33.876 Hospitals must disclose their standard charges for the price of healthcare, 0:03:34.236 --> 0:03:37.716 and insurance companies must disclose their standard charges. So you've 0:03:37.716 --> 0:03:42.596 been working in basically hospital billing, right, hospital revenue, you 0:03:42.676 --> 0:03:46.196 see this rule come, Like, when do you decide to 0:03:46.196 --> 0:03:48.596 start the company and like, how does it fit with 0:03:48.636 --> 0:03:53.396 this story? Yeah, so the rule was proposed, so the 0:03:53.436 --> 0:03:55.916 executive order. I remember where I was with my co 0:03:55.996 --> 0:03:58.996 founder Adam because we were running a business together separately 0:03:59.476 --> 0:04:02.236 or separate from Turquoise, and we saw the rule come out. 0:04:02.276 --> 0:04:04.076 We were like, are you are you reading this same way? 0:04:04.116 --> 0:04:07.196 I am. We're like, I think this means all these 0:04:07.196 --> 0:04:10.356 contracts we see are going to become If it is 0:04:10.396 --> 0:04:11.756 what you think it is, it's going to be a 0:04:11.756 --> 0:04:14.516 big deal. Right, Oh yeah, totally. This is going to 0:04:14.516 --> 0:04:17.316 totally flip the economics of healthcare on its head. It 0:04:17.396 --> 0:04:22.076 could create true consumerism and healthcare. It could create true 0:04:22.516 --> 0:04:25.396 macroeconomic pressures in healthcare, and I want to be a 0:04:25.436 --> 0:04:28.796 part of it. Essentially. So it's this moment when when healthcare, 0:04:28.836 --> 0:04:32.116 when this giant part of the economy that has been opaque, 0:04:32.556 --> 0:04:34.756 is going to get less opaque, It's going to get 0:04:34.756 --> 0:04:38.196 more transparent. You think maybe patients will finally be able 0:04:38.236 --> 0:04:40.756 to actually figure out what healthcare is going to cost, 0:04:40.756 --> 0:04:43.236 maybe they'll be able to shop around. And you decide 0:04:43.276 --> 0:04:46.236 to start this company, Turquoise Health, to kind of get 0:04:46.276 --> 0:04:49.276 in on this moment. What exactly are you setting out 0:04:49.276 --> 0:04:54.036 to do. So we decided late twenty twenty that we 0:04:54.036 --> 0:04:58.436 were going to build the price transparency page of every hospital. 0:04:58.796 --> 0:05:00.636 You know, a hospital's website's not very good, they're going 0:05:00.676 --> 0:05:05.516 to hide this information. So at the time, I went 0:05:05.556 --> 0:05:11.516 on a New Year's vacation with my girlfriend at the 0:05:11.556 --> 0:05:13.836 time now my wife, and I was on my computer 0:05:14.436 --> 0:05:18.716 New Year's Eve checking hospital websites with Adam, my co founder, 0:05:18.756 --> 0:05:21.156 and we were basically waiting for these files to come live, 0:05:21.316 --> 0:05:24.836 these pricing files to come live. And I remember laying 0:05:24.876 --> 0:05:26.916 out by the pool with my laptop and just like 0:05:26.956 --> 0:05:31.916 refreshing common health system pages because these files ended up 0:05:31.916 --> 0:05:35.316 being so hidden, just like we predicted on every hospital's website. 0:05:35.356 --> 0:05:37.596 So to go find them to make sense of them 0:05:37.956 --> 0:05:40.556 became really our whole challenge of last year a twenty 0:05:40.636 --> 0:05:44.596 twenty one. And then this year there was another step 0:05:44.676 --> 0:05:48.076 right where insurers also had to post what they pay 0:05:48.436 --> 0:05:53.556 for each procedure freach hospital. Yes, that was just the summer, right, Yeah, 0:05:53.596 --> 0:05:57.276 this is step two and that is just another huge 0:05:57.276 --> 0:06:02.156 watershed moment. So can we go online right now and 0:06:02.196 --> 0:06:06.236 like actually look at something that will sort of help 0:06:06.316 --> 0:06:09.436 me understand kind of how this works and why it's meaningful. Yeah, 0:06:09.436 --> 0:06:11.276 So how would you like me to do it? Would 0:06:11.316 --> 0:06:13.956 you want to pull up a page or um? So? Okay? 0:06:13.956 --> 0:06:17.436 So I have turquoise dot health uh and it says 0:06:17.676 --> 0:06:21.316 enter service name or code and has a zip code. UM, 0:06:21.996 --> 0:06:25.676 So exactly what's a what's a what's a good basic service? 0:06:25.756 --> 0:06:28.076 That's gonna just tell me what to enter? Just talk 0:06:28.156 --> 0:06:32.316 me through it? Yeah. I usually type in colonoscopy. Okay, 0:06:33.676 --> 0:06:37.876 there's a lot of different uh sub subsets that that 0:06:37.956 --> 0:06:41.156 auto populate. Is there one particular version of it I 0:06:41.156 --> 0:06:44.796 should type in? Yeah? Maybe some diagnostic colonoscopy is is 0:06:44.796 --> 0:06:50.596 pretty common, okay, colonoscope Comma diagnostic yep um. And the 0:06:50.756 --> 0:06:53.556 zip code here in New York. Okay, So I got 0:06:53.556 --> 0:06:58.116 one hundred and twenty six results yep um, and it 0:06:58.156 --> 0:07:01.396 looks like what it's showing me first is the is 0:07:01.436 --> 0:07:05.316 the cash price? So there's Memorial Sloan Kettering, very well 0:07:05.356 --> 0:07:08.596 known hospital four thousand, one hundred and thirty six dollars, 0:07:08.596 --> 0:07:11.676 So seems like a lot. But then I scrolled down 0:07:12.116 --> 0:07:15.356 and I see New York Presbyterian, while Cornell Medical Center 0:07:15.436 --> 0:07:19.836 also fine institution eleven thousand, seven hundred dollars. So the 0:07:19.836 --> 0:07:23.076 difference between four thousand and eleven seven hundred for the 0:07:23.116 --> 0:07:25.756 same procedure is huge. We kind of know this, right, 0:07:25.756 --> 0:07:28.396 it's absurd. We also know that the cash price is 0:07:28.436 --> 0:07:31.476 not that meaningful, right, it's sort of arbitrary. It's weird. 0:07:31.796 --> 0:07:34.316 Most people don't pay it. So it also says, see 0:07:34.316 --> 0:07:36.396 all rates? Should I click? That? Is that where the 0:07:36.396 --> 0:07:39.916 action is? Yeah, and when you see y'all rates, you'll 0:07:39.956 --> 0:07:44.196 see a drop down of whatever insurance plans they disclosed 0:07:44.516 --> 0:07:48.156 to let me do. Oh, one of them doesn't take 0:07:48.156 --> 0:07:53.756 my insurance, which is kind of surprising to meet. This 0:07:53.796 --> 0:07:57.996 can't be right, There's no way. There's no way. Sloan 0:07:58.076 --> 0:08:00.636 Kettering doesn't take Signet and doesn't take Blue Cross. Right, 0:08:00.676 --> 0:08:03.796 there's no way. And so the open secret in healthcare 0:08:04.396 --> 0:08:10.076 in our industry is that even though the rule required 0:08:10.156 --> 0:08:14.196 hospitals to disclose their negotiated rates, their prices for healthcare, 0:08:14.956 --> 0:08:19.076 pricing often is not that simple. It's not a flat 0:08:19.156 --> 0:08:21.996 dollar amount, and so sometimes the way that a rate 0:08:22.076 --> 0:08:26.036 is calculated is using a formula or convoluted math, so 0:08:26.196 --> 0:08:30.556 they omit it. So is this not that useful yet? 0:08:30.756 --> 0:08:32.276 Is that what I should take away from this that 0:08:32.356 --> 0:08:35.196 like this really common procedure at this really big hospital, 0:08:35.236 --> 0:08:38.276 they don't have the information for like really big insurance companies. 0:08:38.316 --> 0:08:41.516 That seems like a problem. And now what we have 0:08:41.636 --> 0:08:45.116 is a bit of Swiss cheese. You know, you sometimes 0:08:45.116 --> 0:08:48.196 find the rate and sometimes you're left scratching your head 0:08:48.596 --> 0:08:51.636 with cheese with maybe more whole than cheese. At this point, 0:08:51.676 --> 0:08:54.316 still we don't have all the information we need yet, 0:08:54.316 --> 0:08:58.236 like is it coming yep, So we're at a snapshot 0:08:58.236 --> 0:08:59.956 in time where this is still you know, we're in 0:08:59.996 --> 0:09:04.596 the first inning and as of July first, we mentioned 0:09:04.596 --> 0:09:08.196 that pair rule that came out. That pair rule remedies 0:09:08.236 --> 0:09:10.636 the issue that you're looking at, and that means that 0:09:10.676 --> 0:09:13.556 companies like Turquoise can fill in the gaps of what 0:09:13.596 --> 0:09:15.716 you just mentioned. So we probably now have in our 0:09:15.796 --> 0:09:19.316 data the signa rate from Memorial slum kettering, and you're 0:09:19.316 --> 0:09:20.996 going to add that if I come back in what 0:09:21.236 --> 0:09:24.236 a month, six months, when's it couldn't be there? Yeah, 0:09:24.236 --> 0:09:26.236 this is pretty new. So we're forty nine days in 0:09:26.316 --> 0:09:28.916 and we're gonna be rolling out services at a time, 0:09:28.956 --> 0:09:31.556 so you know, realistically one to two months for now 0:09:31.596 --> 0:09:35.596 for common services like that you would see this really soon. Yeah, 0:09:35.636 --> 0:09:38.876 so there's there's a lot of optimism. So so okay, 0:09:39.316 --> 0:09:41.636 the data is some of the data is there now 0:09:41.676 --> 0:09:44.076 but kind of not enough, right you, kind of there's 0:09:44.116 --> 0:09:46.316 some critical mass and like we're almost there. There's going 0:09:46.396 --> 0:09:49.316 to be a lot more information available about pricing in 0:09:49.356 --> 0:09:52.636 a really granular way soon. Yes. So then the big 0:09:52.676 --> 0:09:55.716 question is like what's it gonna mean? Who's going to 0:09:55.796 --> 0:09:59.876 do one with it? We have a couple of different products. 0:09:59.956 --> 0:10:02.636 One is a data product that's basically like get an 0:10:02.676 --> 0:10:06.436 idea of the rates an XYZ region and so who 0:10:06.476 --> 0:10:10.996 would use this? Um and new surgery center may use 0:10:11.116 --> 0:10:14.476 is to figure out where to set up shop. So 0:10:14.556 --> 0:10:18.196 you have money, you're an investor, you want to start 0:10:18.196 --> 0:10:20.756 surgery centers, and you see that this particular kind of 0:10:20.796 --> 0:10:23.316 surgery that you are set up to do is like 0:10:23.516 --> 0:10:26.396 really expensive at a certain place, you might go open 0:10:26.436 --> 0:10:29.276 your surgery center there and offer it at a lower price. Yeah, 0:10:29.956 --> 0:10:31.556 Like it's so silly. I'm a nerve, but I get 0:10:31.636 --> 0:10:33.996 goose bumps thinking about that, because it's like, if you 0:10:34.036 --> 0:10:36.996 see that there is a health system that is you 0:10:37.356 --> 0:10:41.116 got the whole northeast portion of a state, just unlock 0:10:41.236 --> 0:10:43.916 and their prices are really high. And now you might 0:10:43.956 --> 0:10:46.676 see a savvy entrepreneur say, hey, I'm going to PLoP 0:10:46.676 --> 0:10:50.556 a bunch of orthopedic surgeons out in Northeast forever, and 0:10:50.676 --> 0:10:53.276 we're gonna start undercutting this health system because we know 0:10:53.316 --> 0:10:56.156 how much it costs to do this procedure. So that's one. 0:10:56.356 --> 0:10:58.956 What are some other kind of lines of business for you? 0:10:58.996 --> 0:11:02.556 What other kinds of people or institutions are paying you? Yeah, 0:11:02.596 --> 0:11:05.996 So one example is we have several startup insurance companies 0:11:06.036 --> 0:11:10.116 paying us. And these startup insurance companies say, hey, wow, 0:11:10.556 --> 0:11:14.396 some of those other insurance companies in my market don't 0:11:14.436 --> 0:11:18.876 seem to be operating efficiently in negotiating appropriate prices for 0:11:18.916 --> 0:11:22.196 this population. And we think we can create a leaner 0:11:23.116 --> 0:11:27.396 health insurance platform so that we could charge you know, 0:11:27.436 --> 0:11:30.836 our patients pay less and they have a better member experience. 0:11:30.836 --> 0:11:33.556 And so that's I'd say, that's in the same vein 0:11:33.596 --> 0:11:36.276 as like a large employer will come to us and say, hey, 0:11:36.716 --> 0:11:39.836 we've been working with this carrier for a long time, 0:11:39.876 --> 0:11:43.036 and we just want insurance company with this insurance company, yeah, 0:11:43.076 --> 0:11:44.676 and we just want to see if there are other 0:11:44.676 --> 0:11:47.196 options out there and if we're getting a fair deal. 0:11:47.436 --> 0:11:50.916 And that's a very common conversation we have. Are like 0:11:51.156 --> 0:11:54.276 big hospitals coming to you also are big insurance companies. 0:11:54.276 --> 0:11:56.356 I mean, so far you've talked about the kind of 0:11:56.596 --> 0:12:01.316 STARTUPPI you know, disruptor types. What about the kind of 0:12:01.356 --> 0:12:04.436 big incumbents are they? Are they your clients? Yeah, there's 0:12:04.436 --> 0:12:06.636 a lot of the big I mean, the big incumbents 0:12:06.676 --> 0:12:11.196 are They're concerned, they're concerned, they're over priced, They're concerned 0:12:11.796 --> 0:12:16.036 that they are not doing all they can to get patients, 0:12:16.316 --> 0:12:19.516 and so they are coming to us. And part of 0:12:19.516 --> 0:12:22.956 the thing with hospitals is they're not just competing with 0:12:22.996 --> 0:12:27.716 other hospitals, right, They're also competing with places like outpatient 0:12:27.836 --> 0:12:30.836 surgery centers, and it seems like there's huge potential for 0:12:30.916 --> 0:12:34.476 price competition there. Yeah, So we talked earlier about a 0:12:34.556 --> 0:12:37.956 NIE meniscus repair. If you get that NI meniscus repaired 0:12:37.996 --> 0:12:43.556 done in a hospital outpatient department, you have a different 0:12:43.676 --> 0:12:46.276 cost structure because that hospital has to run, lights have 0:12:46.356 --> 0:12:50.316 to stay on, they have a bunch of employees. And meanwhile, 0:12:50.596 --> 0:12:52.996 you know, five miles down the road there may be 0:12:53.036 --> 0:12:56.796 a surgery center with a very comparable surgeon, and the 0:12:56.836 --> 0:13:01.276 cost structure is just simpler. You know, they've got the nathesiologists, 0:13:01.276 --> 0:13:04.636 they've got a smaller building, they've got fewer nurses, simpler 0:13:04.636 --> 0:13:07.956 billing practices, simpler contracts. A lot of these surgery center 0:13:08.036 --> 0:13:11.036 contracts are just almost like a restaurant menu. Can you 0:13:11.076 --> 0:13:12.996 give me just a sense? I mean I could, I 0:13:12.996 --> 0:13:14.716 could go look it up, or we could look it up. 0:13:14.716 --> 0:13:17.276 But do you know since I mean, if meniscus repair 0:13:17.356 --> 0:13:19.956 is when you look at a lot, yeah, more or less, 0:13:20.556 --> 0:13:23.076 what might the price be at the hospital versus at 0:13:23.116 --> 0:13:27.116 a at a surgery center. Yeah, very common to see 0:13:27.316 --> 0:13:30.516 common knee procedures and shoulder procedures, all those kind of 0:13:30.596 --> 0:13:33.956 like ligament surgeries to run in the twenty to thirty 0:13:33.996 --> 0:13:37.276 to forty grand range at a hospital all in, and 0:13:37.276 --> 0:13:40.636 then at a surgery center sometimes you know, five to ten, 0:13:41.556 --> 0:13:48.476 so huge, ten versus thirty is wildly different. Yeah, that 0:13:48.476 --> 0:13:51.916 that happens all throughout the US. That's extraordinary. Let's just 0:13:52.156 --> 0:13:54.876 let's just sit in that for a sec right, Like, 0:13:54.916 --> 0:13:57.036 I know we're used to healthcare blah blah blah, but 0:13:57.076 --> 0:14:00.356 like that's that's out of control in some way, Like 0:14:00.396 --> 0:14:05.356 that shouldn't persist. That doesn't make sense and why why 0:14:05.676 --> 0:14:08.396 why has that persisted until now? I mean, it's part 0:14:08.436 --> 0:14:10.836 of it market power? Is it that you know a 0:14:10.836 --> 0:14:15.076 lot of places there's basically one hospital and so the 0:14:15.116 --> 0:14:17.596 insurance company kind of has to pay what the hospital 0:14:17.636 --> 0:14:20.996 asks because it's the only hospital. That's a huge part 0:14:20.996 --> 0:14:23.676 of it. That's probably the main driving thing. It's just 0:14:23.836 --> 0:14:27.476 market power and no other options. So it's kind of 0:14:27.676 --> 0:14:30.836 an antitrust problem. Although if you recognize the surgery center 0:14:30.996 --> 0:14:34.556 as part of the market, then like there's a solution. 0:14:34.636 --> 0:14:36.356 You don't have to go to the hospital. There is 0:14:36.356 --> 0:14:39.636 a competitor. Well, that is the problem. How easy is 0:14:39.676 --> 0:14:43.636 it to affect change in the market, Like how easy 0:14:43.676 --> 0:14:47.116 is it for a top orthopedic surgeon to open a 0:14:47.156 --> 0:14:50.716 surgery center and to move out of the hospital environment. 0:14:50.996 --> 0:14:53.636 And it's that a regulatory question. Is it a sort 0:14:53.636 --> 0:14:57.996 of access to capital question? Like what affects that? It's 0:14:57.996 --> 0:15:03.276 all the above, regulatory access to capital, comp practice privileges. 0:15:03.316 --> 0:15:05.636 You know, once you're out, you're out, like forget about 0:15:05.916 --> 0:15:08.156 you can't if the hospital says if you go open 0:15:08.196 --> 0:15:10.396 a surgery center, you can't admit patients to the hospital. 0:15:10.476 --> 0:15:13.236 Anymore they do. Yeah, oh yeah, that's definitely a thing. 0:15:13.316 --> 0:15:16.636 So how easy is it for this side of service 0:15:16.636 --> 0:15:20.436 shift to occur? And so there are a bunch of barriers, 0:15:20.436 --> 0:15:24.636 and I think price transparency forces will work to you know, 0:15:24.916 --> 0:15:35.876 be down those barriers. Okay, but really, really, what is 0:15:35.876 --> 0:15:38.116 it going to take to get to a world where 0:15:38.116 --> 0:15:40.276 we know what a trip to the hospital is going 0:15:40.316 --> 0:15:44.716 to cost before we go to the hospital. That's coming 0:15:44.796 --> 0:15:51.356 up after the break. Now back to the show. What's 0:15:51.396 --> 0:15:53.756 the thing you haven't figured out how to do yet? 0:15:53.796 --> 0:15:55.716 What's like a problem you've been kind of working on 0:15:55.756 --> 0:15:59.236 but you feel like you haven't really cracked yet. So 0:15:59.316 --> 0:16:05.356 there's two big ones. One is how do we convince 0:16:06.516 --> 0:16:12.436 and or enable the providers and payers to agree to 0:16:12.436 --> 0:16:17.156 an upfront price for healthcare? So a hard problem we're 0:16:17.196 --> 0:16:20.596 working on is for your average insured patient to give 0:16:20.636 --> 0:16:23.276 them an upfront binding price that the hospital and the 0:16:23.316 --> 0:16:26.996 insurance company will stand by. And there's a new rule 0:16:27.036 --> 0:16:30.876 coming that seems relevant, right where the kind of the 0:16:30.916 --> 0:16:34.076 explanation of benefits that you get after you go whatever 0:16:34.156 --> 0:16:36.276 to the doctor, you're supposed to be able to get 0:16:36.316 --> 0:16:38.916 that before you go, Right, that's like a thing that's coming. 0:16:39.036 --> 0:16:42.036 Is that relevant here, Yeah, And that is a huge 0:16:42.036 --> 0:16:44.916 complexity ahead of us, and it's still dependent on new 0:16:45.036 --> 0:16:47.716 rulemaking coming out of the government any day. I mean, 0:16:47.756 --> 0:16:51.156 it's probably like there is some amount of actual complexity 0:16:51.196 --> 0:16:54.396 in healthcare where like the body is complicated. They don't 0:16:54.396 --> 0:16:57.716 know what's going to happen, Like there's a reason, you know, 0:16:58.516 --> 0:17:00.356 especially if somebody's really sick, they got a lot of 0:17:00.356 --> 0:17:02.956 things wrong with them. The hospital doesn't know what's going 0:17:02.996 --> 0:17:04.756 to have to happen, Like I feel like there's cases 0:17:04.756 --> 0:17:08.756 where they in good faith don't know totally and it 0:17:08.836 --> 0:17:11.716 just comes. This is where actualaries come in the law 0:17:11.756 --> 0:17:15.036 of large numbers. If one person comes in for that 0:17:15.116 --> 0:17:18.836 nimniscus repair and they have some comorbidities, turns out there 0:17:18.836 --> 0:17:22.036 in the operating room an hour longer than planned, that 0:17:22.116 --> 0:17:24.836 could be a loss for the surgery center of the hospital. 0:17:25.116 --> 0:17:27.796 But if a hundred patients come in, then you know, 0:17:27.916 --> 0:17:30.276 ninety out of one hundred will follow a similar cost structure, 0:17:31.076 --> 0:17:33.196 and so they should be able to promise to charge 0:17:33.236 --> 0:17:36.156 some average rate that over time is the right price 0:17:36.276 --> 0:17:38.636 at which they can run their business at a profit. Yeah, 0:17:38.676 --> 0:17:41.436 and that's happening in some places, but it needs to 0:17:41.476 --> 0:17:43.756 happen in more to create that kind of coverage of 0:17:43.796 --> 0:17:47.036 the market. Like we've discussed. Okay, so that's one, what's 0:17:47.036 --> 0:17:51.276 the other. The other is pretty much the same problem, 0:17:51.756 --> 0:17:54.036 but more to B to B level. How do we 0:17:54.076 --> 0:17:59.396 create a binding, easy to reconcile payment between the insurance 0:17:59.436 --> 0:18:01.556 company and the hospital, Because that's where a lot of 0:18:01.596 --> 0:18:07.636 the waste happens in healthcare, is the billing and claim 0:18:07.636 --> 0:18:11.916 adjudication mumbo jumbo that goes on between those two entities. 0:18:12.036 --> 0:18:14.916 That's way more than with patients. Right, Presumably the vast 0:18:14.956 --> 0:18:17.516 amount of money and healthcare is not going from a 0:18:17.636 --> 0:18:20.156 patient's wallet to the hospital. It's going from the insurance 0:18:20.196 --> 0:18:22.476 company to the hospital. Yeah, the lion's share of the 0:18:22.516 --> 0:18:26.236 waste here that affects our GDP and our premiums and 0:18:26.236 --> 0:18:30.156 our salaries is coming through that B to B transaction. 0:18:30.236 --> 0:18:33.836 And so tell me about like in a way it's surprising. 0:18:33.876 --> 0:18:35.196 I mean, if you know about healthcare, it's kind of 0:18:35.196 --> 0:18:38.476 not surprising, but sort of naively it's surprising because you 0:18:38.476 --> 0:18:41.356 would think, oh, insurance companies are giant and hospitals are giant, 0:18:41.356 --> 0:18:43.876 and they do so many of these procedures. What's the 0:18:43.956 --> 0:18:49.236 problem there. I'll give you an example hopefully that helps. Yeah, 0:18:49.636 --> 0:18:55.396 often if you go in for that nimniscus repair, a 0:18:55.436 --> 0:18:58.116 few other things might happen. They might clear out some 0:18:58.236 --> 0:19:01.436 other cartilage. At the end of the day, you might 0:19:01.516 --> 0:19:04.396 end up with three different procedures build on your claim. 0:19:04.916 --> 0:19:08.236 And if there's any issue with the claim and what 0:19:08.396 --> 0:19:11.116 you end up with our people like me in the 0:19:11.276 --> 0:19:13.556 last ten years, well, we'll go through in data mind 0:19:13.596 --> 0:19:18.396 and find those discrepancies and charge a fee and sort 0:19:18.436 --> 0:19:22.836 of push these reconciliations back and forth for years after 0:19:22.876 --> 0:19:25.516 the fact. So, just to be clear, what you wind 0:19:25.596 --> 0:19:29.756 up with is the hospital and the insurance company negotiating 0:19:29.836 --> 0:19:32.996 on a case by case basis, people at both places 0:19:33.076 --> 0:19:35.636 getting paid to It's kind of like going to court. 0:19:35.676 --> 0:19:37.516 They're not going to court, but they're arguing over like 0:19:37.796 --> 0:19:40.036 did you do this one procedure on this one patient 0:19:40.076 --> 0:19:42.836 this one day. That's what you're talking about. It's exactly that. 0:19:42.916 --> 0:19:45.836 And what ends up is this really long, honestly years 0:19:45.876 --> 0:19:49.636 long process where these case by case reconciliations are happening, 0:19:49.916 --> 0:19:52.556 which is wildly expensive, right, and we end up paying 0:19:52.596 --> 0:19:55.916 for that in our health insurance premiums huge industry and 0:19:56.116 --> 0:19:58.756 we don't benefit from that. Like, it would be great 0:19:58.796 --> 0:20:00.876 to get rid of that. It would be an efficiency 0:20:00.876 --> 0:20:04.116 gain that would lower healthcare prices. Yeah, So how do 0:20:04.196 --> 0:20:07.076 you get rid of that super costly back and forth? 0:20:07.516 --> 0:20:10.476 That's a good, big problem. Do you get rid of that? 0:20:10.476 --> 0:20:13.036 That's the hard thing I guess is this is an 0:20:13.076 --> 0:20:16.876 industry that's slow to adopt new software. They're setting their ways. 0:20:17.356 --> 0:20:19.356 It's very difficult. I think that's one of our biggest 0:20:19.356 --> 0:20:21.756 problems ahead of us if we want to simplify this 0:20:21.836 --> 0:20:25.996 payment and healthcare is you can't just build that future solution, 0:20:26.036 --> 0:20:28.996 but you've got to build the steps to get there. Okay, Yeah, 0:20:29.076 --> 0:20:30.756 that's a big part of what our team's working on. 0:20:30.876 --> 0:20:35.356 Baby steps, Baby, baby steps. So's the what's like, what's 0:20:35.396 --> 0:20:37.356 the middle ground? I get the end is it's just 0:20:37.516 --> 0:20:40.116 software and there's no people whose job is arguing over 0:20:40.196 --> 0:20:43.716 mindy repair, right, But what's what's the step between here 0:20:43.716 --> 0:20:47.116 and there? The middle ground for both of those problems. 0:20:47.156 --> 0:20:49.236 You know, the patient payment and the B to B 0:20:49.356 --> 0:20:56.316 payment is enabled by this new law that takes effect 0:20:56.596 --> 0:20:59.636 essentially in twenty twenty three. We're still waiting for guidance. 0:20:59.676 --> 0:21:02.916 And it's a piece of No Surprises, the No Surprises Act, 0:21:03.316 --> 0:21:05.716 and you mentioned it earlier. If that says you are 0:21:05.916 --> 0:21:10.276 entitled to a good faith estimate in advance of care, okay. 0:21:10.956 --> 0:21:15.836 If that estimate of your cast share ends up being 0:21:15.836 --> 0:21:18.676 off by a certain amount four hundred dollars the amount 0:21:18.716 --> 0:21:22.916 currently proposed, then you as a patient have recourse to 0:21:23.196 --> 0:21:25.716 reconcile that and to argue it, dispute it. Meaning you 0:21:26.116 --> 0:21:28.316 might not be on the hook. You might not be 0:21:28.356 --> 0:21:30.316 on the hook for the big bill that you were sent. 0:21:30.796 --> 0:21:35.316 And so that presumably gives everybody in the system an 0:21:35.396 --> 0:21:38.556 incentive to come up with a number in advance and 0:21:38.636 --> 0:21:41.956 stick to it and not argue about it after exactly 0:21:42.316 --> 0:21:45.156 let me ask you. Let me ask you one. There's 0:21:45.196 --> 0:21:47.716 kind of a subtext here for me. I mean, really, 0:21:47.716 --> 0:21:52.476 what we're talking about is bringing market forces to bear 0:21:53.036 --> 0:21:57.596 on healthcare to make healthcare more efficient than better, which 0:21:57.636 --> 0:22:01.116 makes sense in a certain way of thinking. I do wonder. 0:22:01.156 --> 0:22:03.076 I mean, clearly, there are a lot of things where 0:22:03.116 --> 0:22:06.236 the market works great. It does seem like healthcare is 0:22:06.276 --> 0:22:09.356 a place where there are a bunch of reason to 0:22:09.396 --> 0:22:12.396 think market forces might not work great. Even if we 0:22:12.516 --> 0:22:15.316 set up the market better. Right, patients are scared, they 0:22:15.356 --> 0:22:20.156 trust their doctor. It's intermediated by insurance. And so I 0:22:20.156 --> 0:22:22.156 don't know if this question is like too big, but 0:22:22.316 --> 0:22:25.116 does it even make sense to try and make the 0:22:25.196 --> 0:22:31.476 market work in healthcare? I would argue by saying that 0:22:31.516 --> 0:22:34.076 the consumer can decide if they if this is worth 0:22:34.116 --> 0:22:36.396 it for them to make a change. So an example is, 0:22:36.716 --> 0:22:39.756 if you love your doctor and you care about your 0:22:39.756 --> 0:22:42.476 health or your family member's health, it is your right 0:22:42.556 --> 0:22:45.356 to decide if that is worth more to you. And 0:22:45.436 --> 0:22:47.276 maybe the drive to get there is worth more to 0:22:47.316 --> 0:22:49.556 you than the five thousand dollars you can save. And 0:22:49.596 --> 0:22:51.836 so maybe what the market forces in healthcare how they 0:22:51.836 --> 0:22:55.956 differ is just that it will take more for there 0:22:55.996 --> 0:22:59.276 to be a change of the consumer decision or the 0:22:59.276 --> 0:23:02.396 purchase or decision than it does in other industries. Right, 0:23:02.436 --> 0:23:04.796