Podcasts about health care financing administration

Can Therapists Start a Union? The Antitrust Trap, the Shadow Committee, and the Economic Strangulation of American Psychotherapy Analyzing America's Healthcare Regulations and Their Effect on Us: Why the Law Prevents Therapists from Organizing While Allowing a Private Committee to Fix Prices for the Entire Medical System https://gettherapybirmingham.com/can-therapists-start-a-union-spoiler-alert-they-cant/ The Monthly Rage Thread If you hang around therapist forums long enough, you will see it happen. It operates with the regularity of the tides. Someone posts a thread, usually after receiving a contract from an insurance company offering 1998 rates for 2025 work, and asks the obvious question: “We are the ones providing the care. The system collapses without us. Why don't we just all go on strike? Why don't we form a union and demand fair pay?” It is a logical question. In almost every other sector of the economy, workers who feel exploited band together to negotiate better terms. Screenwriters shut down Hollywood to get paid for streaming residuals. Auto workers walk off the line. Teachers fill the state capitol. Nurses at major hospital systems have successfully unionized and won significant concessions. So why, in the midst of a national mental health crisis, does the mental health workforce remain so politically impotent? The answer is not that we lack will. It is not that we lack organization. The answer is that for private practice therapists, forming a union is a federal crime. This is not a political manifesto. It is an analysis of the bizarre regulatory environment that governs American healthcare, a system of antitrust laws, shadow committees, and bureaucratic classifications that effectively strips clinicians of their bargaining power while empowering the corporations that pay them. If you want to understand why corporate tech monopolies are ruining therapy, or why the corporatization of healthcare feels so suffocating, you have to understand the legal straitjacket we are all wearing. And you have to understand the one group that is allowed to set prices, the one group exempt from the rules that bind the rest of us. Part I: You Are Not a Worker, You Are a Standard Oil Tycoon The primary reason therapists cannot unionize dates back to the era of oil barons and railroad tycoons. The Sherman Antitrust Act of 1890 was designed to prevent massive corporations like Standard Oil from colluding to fix prices and destroy the free market. It prohibits “every contract, combination… or conspiracy, in restraint of trade.” The law was a response to genuine abuses: companies buying up competitors, dividing territories, and coordinating prices to gouge consumers who had no alternatives. Here is the catch: In the eyes of the federal government, a private practice therapist is not a “worker.” You are a business entity. Even if you are a solo practitioner struggling to pay rent in a subleased office, seeing clients between crying in your car and eating lunch at your desk, the law views you as the CEO of a micro-corporation. You are classified as a 1099 independent contractor, not a W-2 employee, and that distinction makes all the difference in the world. If two workers at Starbucks talk about their wages and agree to ask for a raise, that is “collective bargaining,” which is protected by the National Labor Relations Act. But if two private practice therapists talk about their reimbursement rates and agree to ask Blue Cross for a raise, that is “price-fixing.” It is legally indistinguishable, in the eyes of the Federal Trade Commission, from gas stations conspiring to raise the price of unleaded. It sounds absurd, but the FTC takes it deadly seriously. When independent contractors organize to demand higher rates, when they share information about what they are being paid and coordinate their responses, they are engaging in horizontal price-fixing, one of the most serious violations of antitrust law. The Sherman Act provides for criminal penalties, including fines and imprisonment. The law that was meant to break up monopolies is now used to prevent social workers from asking for a cost-of-living adjustment. The irony is crushing. The same regulatory framework that prevents two therapists from discussing their rates allows massive insurance conglomerates to merge repeatedly, concentrating buyer power in fewer and fewer hands. UnitedHealth Group, for example, has acquired dozens of companies over the past two decades, becoming the largest healthcare company in the United States. When they offer a “take it or leave it” contract to providers, they do so with the full knowledge that fragmented, legally prohibited from organizing therapists have no counter-leverage. The antitrust laws, designed to prevent monopoly power, have created a system where sellers are atomized and buyers are consolidated. Economists call this “monopsony,” and it is precisely the market distortion the Sherman Act was supposed to prevent. Part II: The Day the “Learned Profession” Died For a long time, doctors and lawyers thought they were exempt from these laws. They argued that they were “learned professions,” not mere tradespeople, and therefore above the grubby laws of commerce. They believed that their ethical obligations to patients and clients set them apart from the rules that governed steel mills and meatpacking plants. Medicine was a calling, not a business, and surely the government would not regulate the sacred doctor-patient relationship as if it were a commercial transaction. That illusion was shattered in 1975 by the Supreme Court case Goldfarb v. Virginia State Bar. The case involved lawyers, not doctors, but its implications cascaded through every licensed profession in America. The Goldfarbs were purchasing a home and needed a title examination. The Virginia State Bar had established a minimum fee schedule for such services, and every lawyer they contacted quoted the exact same price. They sued, arguing that this fee schedule was illegal price-fixing. The Supreme Court agreed. In a unanimous decision, the Court ruled that professional services, including legal and medical advice, are “trade or commerce” subject to antitrust laws. The “learned profession” exemption, which had been assumed but never explicitly established in law, was declared a myth. “The nature of an occupation, standing alone,” the Court wrote, “does not provide sanctuary from the Sherman Act.” This ruling was intended to lower prices for consumers by preventing lawyers from setting minimum fees, and in that narrow sense it was a good thing. But in healthcare, it had a catastrophic side effect: it made it illegal for doctors and therapists to band together to resist the pricing power of insurance companies. The “learned profession” exemption is dead. We are now just businesses, and businesses are not allowed to hold hands. This creates the illusion of progress: we have “free market” competition among providers, but monopsony power among payers. It is a market where the sellers are forbidden from organizing, but the buyers are allowed to merge until they are too big to fail. The result is not a free market at all. It is a market designed to transfer wealth from one class (providers) to another (insurers and administrators), with the law itself serving as the enforcement mechanism. Part III: The Cartel in the Basement If therapists cannot collude to set prices, surely nobody else can, right? Wrong. There is one group in American healthcare that is allowed to meet in a room, decide what every doctor's time is worth, and set prices for the entire industry. It is called the RUC, the AMA/Specialty Society Relative Value Scale Update Committee. And understanding the RUC is the key to understanding why talk therapy is dying in the medical model, why psychiatrists abandoned the couch for the prescription pad, and why your insurance company offers you a ghost network of providers who never answer the phone. The Birth of a Shadow Government To comprehend the current crisis in mental health economics, one must excavate the foundations of the physician payment system. Prior to 1992, Medicare reimbursed physicians based on a system known as “Customary, Prevailing, and Reasonable” charges. Under this system, physicians were paid based on their historical billing charges. It was inherently inflationary; it rewarded those who raised their fees most aggressively and created wide geographic disparities for identical services. In response to spiraling costs, Congress passed the Omnibus Budget Reconciliation Act of 1989, mandating a transition to a fee schedule based on the resources required to provide a service. This birthed the Resource-Based Relative Value Scale. The intellectual architecture for this system was developed by a team of economists at Harvard University, led by William Hsiao. Hsiao's team sought to create a “unified theory” of medical value, attempting to quantify the “work” involved in disparate medical acts, comparing the cognitive intensity of a psychiatric evaluation with the technical skill of a hernia repair. The Harvard study was revolutionary. It promised to level the playing field, suggesting that cognitive services, the thinking and talking that comprises primary care and mental health, were vastly undervalued relative to surgical procedures. Had Hsiao's original recommendations been implemented purely, the income gap between generalists and specialists might have narrowed significantly. But the administrative complexity of assigning values to over 7,000 Current Procedural Terminology codes overwhelmed the Health Care Financing Administration. Into this administrative vacuum stepped the American Medical Association. The AMA, fearing that the government would unilaterally set prices, proposed a “partnership.” They would convene a committee of experts to maintain and update the relative values, providing this labor-intensive service to the government at no cost. The government accepted. Thus, in 1991, the RUC was born, not as a government agency, but as a private advisory body with unparalleled influence over public funds. The Architecture of Control The RUC's claim to legitimacy rests on its status as an “expert panel.” But a structural analysis of its composition reveals a profound bias that mimics the governance of a cartel designed to protect incumbent interests. The committee consists of 32 members, but power is concentrated in the 29 voting seats. Of these, 21 seats are appointed by major national medical specialty societies. The distribution is not proportional to the volume of services provided to Medicare beneficiaries, nor is it proportional to the physician workforce. Instead, it is frozen in a historical moment that favored high-technology specialties. Primary care physicians, who perform roughly 45 to 50 percent of Medicare work, hold approximately 4 to 5 seats, giving them about 17 percent of the vote. Procedural and surgical specialties, including surgery, radiology, and anesthesiology, hold 15 to 18 seats, giving them roughly 60 percent of the vote despite performing only 35 to 40 percent of Medicare work. The American Psychiatric Association holds a single seat. One seat. This lone representative must negotiate with a supermajority of specialists, neurosurgeons, cardiothoracic surgeons, radiologists, and ophthalmologists, whose financial interests are often diametrically opposed to the valuation of cognitive work. The cartel dynamic is enforced by a statutory requirement of budget neutrality. The Medicare Physician Fee Schedule is a zero-sum game. If the total relative value units projected for a given year exceed the budget, a “scaler” is applied to reduce the conversion factor, effectively cutting everyone's pay. Therefore, any proposal to increase the value of psychotherapy, which would increase the total RVU spend, effectively asks every surgeon in the room to take a pay cut to fund the raise for psychiatrists. Given that a two-thirds majority is required to pass a recommendation, the procedural bloc holds absolute veto power over any redistribution of wealth. The Secret Chamber A hallmark of cartel behavior is the restriction of information. For nearly two decades, the RUC operated in near-total secrecy. While recent years have seen minor concessions to transparency, such as the publication of vote totals, the core deliberative process remains opaque. RUC meetings are private. The public, the press, and even non-RUC physicians are largely barred from attending the deliberations where billions of tax dollars are allocated. Participants, including the specialty advisors who present data, must sign strict non-disclosure agreements. These agreements prevent them from discussing the specific tradeoffs, deals, or arguments made within the chamber. A former RUC participant described these agreements as “draconian,” designed to insulate the committee from public accountability. The Government Accountability Office and the Center for American Progress have noted the inherent conflict of interest. The individuals setting the prices are the same individuals who receive the payments. Unlike a regulatory agency, where officials are salaried and divested of industry assets, RUC members are practicing physicians whose personal incomes are directly tied to the decisions they make. This secrecy serves a functional purpose: it allows for “logrolling.” A representative from Orthopedics might support an inflated value for a Cardiology code in exchange for Cardiology's support on a Knee Replacement code. This “I'll scratch your back” dynamic creates an upward pressure on procedural values that excludes those outside the dominant coalition, specifically primary care and mental health. The Antitrust Shield Why has the Department of Justice not broken up this cartel? The legal shield is the Noerr-Pennington Doctrine. This Supreme Court doctrine establishes that private entities are immune from antitrust liability when they are petitioning the government. Because the RUC technically only “recommends” values to CMS (that is petitioning), and CMS “decides” (that is government action), the RUC is protected by the First Amendment right to petition. This legal loophole allows the RUC to operate with monopolistic characteristics without fear of prosecution, provided CMS continues to go through the motions of “reviewing” the recommendations. And CMS accepts those recommendations over 90 percent of the time. Because private insurance companies generally base their rates on Medicare, this private committee effectively sets the price of healthcare for the entire country. If independent therapists did this, if they gathered in a room and agreed on what their services should cost, they would face criminal prosecution. But because the RUC operates under the fiction of “advising” the government, it is protected. The same regulatory framework that criminalizes therapist solidarity provides cover for industry-wide price coordination by the most powerful medical specialties. Part IV: The Mechanics of Suppression To control a market, one must control its currency. In American medicine, that currency is the Relative Value Unit. Every medical service, from a 15-minute therapy session to a heart transplant, is assigned a total RVU value. This value is the sum of three components: the Work RVU, which accounts for physician time, technical skill, mental effort, and judgment; the Practice Expense RVU, which covers overhead costs like rent, staff, and equipment; and the Malpractice RVU, which reflects professional liability insurance costs. The Work RVU, which comprises roughly 50 to 55 percent of the total value, is determined by RUC surveys. When a code is flagged for review, the relevant specialty society distributes a survey to a sample of its members. These respondents are asked to estimate the time and intensity of the service compared to a “reference service.” This methodology violates several principles of statistical validity. The surveys are voluntary and distributed by the specialty societies themselves. The respondents are typically those most active in the society and most invested in maximizing reimbursement, advocates rather than neutral observers. The sample sizes are often shockingly small; RUC surveys frequently rely on fewer than 50 or 70 respondents to set the price for services performed millions of times annually. A sample of 30 orthopedic surgeons might determine the value of a procedure costing Medicare billions. The Time Arbitrage The most critical variable in the RUC equation is time. The Work RVU is conceptually derived from the formula: Work equals Time multiplied by Intensity. Therefore, inflating the time estimate is the most direct route to inflating the price. Independent studies by RAND and the Urban Institute, often using objective data like Operating Room logs, have consistently shown that the RUC overestimates the time required for surgical procedures. A procedure valued by the RUC as taking 60 minutes may, in reality, take 30 minutes. This creates an arbitrage opportunity. If a gastroenterologist can perform a “60-minute” colonoscopy in 20 minutes, they can effectively perform three procedures in the time allotted for one. They bill for three hours of work in one hour of real time. This “efficiency gain” is captured entirely by the physician as profit. Psychotherapy cannot utilize this arbitrage. CPT codes for psychotherapy are explicitly time-based in their definition. Code 90832 requires 16 to 37 minutes. Code 90834 requires 38 to 52 minutes. Code 90837 requires 53 minutes or more. A psychiatrist cannot perform a 60-minute therapy session in 20 minutes; doing so constitutes fraud. Therefore, the revenue of a psychotherapist is capped by the linear passage of time. They can sell, at maximum, roughly 8 to 10 units of labor per day. A proceduralist, aided by RUC-inflated time assumptions, can sell 20 or 30 units of “RUC time” in the same day. This structural discrepancy creates a widening income gap that no amount of “hard work” by the therapist can close. It is not a market failure. It is market design. The “Thinking” Penalty The RUC's bias is not merely structural; it is philosophical. The committee, dominated by surgeons and proceduralists, consistently values “doing things to people,” cutting, scanning, injecting, far more highly than “talking to people,” diagnosing, counseling, managing complex chronic conditions. This creates a regulatory environment that functions as a de facto wealth transfer from cognitive care to procedural care. In 2013, a major revision of psychiatry codes exposed this bias in stark relief. Previously, psychiatrists used codes that bundled the medical evaluation with the psychotherapy. The new system required psychiatrists to bill an E/M code for the medical management plus an “add-on” code for psychotherapy. While intended to improve transparency, this change exposed psychotherapy to the raw mechanics of the RUC's valuation bias. By isolating the “therapy” component, the committee could subject it to rigorous cross-specialty comparison. And the committee, dominated by surgeons, views “talking to a patient” as low-intensity work compared to “operating on a patient.” The economic signal was clear. This created the 15-minute med check culture not because psychiatrists stopped caring, but because the regulatory environment made relational care financial suicide. It effectively “illegalized” the practice of deep, slow psychiatry for anyone who wanted to take insurance. Part V: The “Messenger Model” and Other Legal Fictions When therapists ask about collective bargaining, lawyers will often point them to the only legal loophole available: the “Messenger Model.” In this model, a third party (the messenger) acts as an intermediary between a group of providers and an insurance company. The messenger takes the insurance company's offer and conveys it to each therapist individually. Each therapist must then make a unilateral, independent decision to accept or reject it. The messenger is strictly forbidden from negotiating. They cannot say, “The group rejects this.” They cannot say, “We want 10% more.” They cannot advise the therapists on what to do. They can only carry messages. This is why “Independent Practice Associations” are often toothless. In the 2008 case North Texas Specialty Physicians v. FTC, the Fifth Circuit Court of Appeals made clear that if an IPA actually tries to leverage its numbers to demand better rates, it violates antitrust laws. If it follows the messenger model, it has no leverage. It is a “heads I win, tails you lose” regulatory structure designed to protect payers, not providers. The only exception is “clinical integration,” where providers genuinely merge their practices, share infrastructure, and accept joint financial risk. But this requires substantial capital investment and essentially means ceasing to be an independent practitioner. It is a legal pathway available mainly to large physician groups and hospital systems, not to solo therapists working out of rented offices. Part VI: Market Distortions and the Flight to Cash When a cartel sets a price below the market equilibrium, suppliers exit the formal market. This is precisely what has happened in psychotherapy. Mental health providers generally have lower overhead than surgeons. They do not need MRI machines or sterile surgical suites. And they face high consumer demand; the national mental health crisis ensures a steady stream of people seeking services. This gives them an “exit option” that proceduralists do not have. They can refuse to accept insurance and operate as cash-only businesses. The statistics are stark. Nearly 50 percent of psychiatrists do not accept commercial insurance, compared to less than 10 percent of other specialists. A 2023 survey indicated that 64 percent of private practice therapists planned to increase their cash-pay rates. Research published in Health Affairs Scholar found that patients are 10.6 times more likely to go out-of-network for mental health care than for medical/surgical care. This mass exodus is a rational economic response to RUC-suppressed rates. If the RUC says an hour of therapy is worth $100 via the RVU-to-dollar conversion, but the market demand is willing to pay $250, the provider will leave the RUC-controlled sector. They are not abandoning their profession; they are abandoning a pricing regime that values their work at less than half its market rate. Ghost Networks The RUC's pricing failure creates “Ghost Networks,” directories filled with providers who are ostensibly “in-network” but are functionally inaccessible. They are either full, not accepting new patients, retired, have moved, or simply do not respond to inquiries from insurance-based patients because the administrative burden of prior authorizations and clawbacks outweighs the suppressed fee. This is not a “shortage” of providers in the absolute sense. There is no shortage of therapists in private practice. There is a shortage of therapists willing to work at the RUC-determined price point. The insurance directories are graveyards of phantom availability, creating the illusion of access where none exists. The Cost Paradox The central thesis of the RUC's defenders is that they “control costs.” By strictly managing RVUs, they claim to save taxpayer money. In psychotherapy, this logic backfires catastrophically. By suppressing reimbursement rates to a level that drives providers out of the network, the RUC forces patients into the cash market. The theoretical in-network cost might be a $20 copay with the insurer paying $100. The actual out-of-network cost is $250 cash out-of-pocket, paid in full by the patient. Thus, the “cost of therapy” for the consumer skyrockets. Therapy becomes a luxury good, accessible only to those with disposable income. For the poor and middle class, the “cost” is effectively infinite, because the service becomes inaccessible. The RUC's cost-control measure for the system becomes a cost-multiplier for the patient. It shifts the financial burden from the risk pool, where it belongs, to the individual, where it causes maximum harm. The Signal to Students The RUC sends powerful economic signals to medical students making career decisions. When a student observes that a dermatologist or radiologist can earn $500,000 working regular hours, while a psychiatrist earns $240,000 handling emotional trauma and on-call emergencies, while a primary care doctor earns even less, the choice is clear for those motivated by financial security. The undervaluation of cognitive codes discourages the best and brightest from entering mental health and primary care. The cartel's pricing structure creates a perpetual labor shortage in the fields most needed for public health, while creating a surplus in high-margin procedural specialties. We then wonder why there are not enough psychiatrists, why primary care is in crisis, why mental health access is collapsing. The answer is in the price signal, and the price signal is set by a committee of proceduralists meeting behind closed doors. The Hands Are Tied The question “Why can't therapists start a union?” is not just a labor question. It is a window into the broken soul of American healthcare. We have built a system where a secret committee of proceduralists can legally fix prices to favor surgery over therapy, but a group of social workers cannot band together to ask for a living wage. We have utilized laws meant to break up Standard Oil to break up the solidarity of caregivers. The same regulatory framework that criminalizes therapist coordination provides legal cover for industry-wide price coordination by the most powerful medical specialties. The result is a regulatory environment that drives doctors crazy, burns out therapists, and leaves patients navigating a fragmented, assembly-line system that was never designed to heal them. It was designed to process them. Until we confront the legal architecture of this system, the RUC, the Sherman Act, the 1099 trap, we will remain powerless to change it. And the reality of therapy is that quick fixes, whether in treatment or in policy, usually end up costing us more in the end. Some states are beginning to push back. New York and California have implemented strict network adequacy standards requiring mental health appointments within 10 business days. These regulations force insurers to expand their networks, which means they must attract providers, which means they must raise reimbursement rates above the RUC/Medicare floor. It is effectively a state-level override of the RUC cartel, forcing capital back into the mental health labor market. The Medicare Payment Advisory Commission has long advocated for stripping the RUC of its power, proposing the use of empirical data, tax returns, payroll records, practice invoices, to set values automatically. But these are patchwork solutions to a systemic problem. The fundamental issue remains: we have created a healthcare system that knows the price of everything and the value of nothing. We have engineered a system where the only way to survive is to stop acting like a healer and start acting like a factory. And we have wrapped this system in a legal framework that criminalizes resistance while protecting the status quo. The hands are tied. But at least now we can see the ropes. Bibliography For those interested in the primary sources and legal texts that underpin this analysis, the following external resources provide high-trust verification of the claims made above: Goldfarb v. Virginia State Bar, 421 U.S. 773 (1975): The Supreme Court decision that ended the “learned profession” exemption from antitrust laws. Read the Oyez Summary. The Sherman Antitrust Act (15 U.S.C. §§ 1–7): The foundational text of US antitrust law prohibiting restraint of trade. Read the Document at the National Archives. North Texas Specialty Physicians v. Federal Trade Commission (5th Cir. 2008): A key ruling establishing that independent physicians cannot collectively bargain on fees without financial integration. Read the Court Opinion. FTC/DOJ Statements of Antitrust Enforcement Policy in Health Care (1996): The federal guidelines explaining the “Messenger Model” and the narrow exceptions for clinical integration. Read the Guidelines (PDF). The RUC (AMA/Specialty Society RVS Update Committee): The AMA's own description of the committee structure and its role in valuing physician work. Visit the AMA RUC Page. “Special Deal” by Haley Sweetland Edwards (Washington Monthly, 2013): An investigative deep-dive into how the RUC operates and its impact on primary care vs. specialty pay. Read the Investigation. The National Labor Relations Act (NLRA): The law governing the right to unionize, which specifically excludes independent contractors. Read the NLRA. Laugesen, Miriam J. Fixing Medical Prices: How Physicians Are Paid. Harvard University Press, 2016. The definitive scholarly analysis of the RUC's history, structure, and influence on American healthcare pricing. Government Accountability Office. “Medicare Physician Payment Rates: Better Data and Greater Transparency Could Improve Accuracy.” 2015. GAO's critical analysis of RUC methodology and conflicts of interest. Center for American Progress. “Rethinking the RUC.” 2015. Policy analysis of the RUC's structural bias against primary care and cognitive services. Health Affairs Scholar. “Insurance Acceptance and Cash Pay Rates for Psychotherapy in the US.” 2023. Empirical research on out-of-network utilization in mental health care. Medicare Payment Advisory Commission (MedPAC). “Report to the Congress: Medicare and the Health Care Delivery System.” 2024. Annual policy recommendations including proposals for reforming physician fee schedule methodology. Joel Blackstock, LICSW-S, is the Clinical Director of Taproot Therapy Collective in Hoover, Alabama. He specializes in complex trauma treatment and writes at GetTherapyBirmingham.com.  

Somebody wrote on Twitter the other day that he was gonna give a talk on the use of evidence in drug policy, and Barrett Montgomery replied, “That'll be a short talk then!” So, let's talk about the IRA (Inflation Reduction Act) for a moment, specifically the “CMS can negotiate for drugs for Medicare patients” part of the IRA. There's one topic I don't hear discussed what I would consider maybe often enough. Will these negotiations result in pricing that is evidence based? Will good drugs that companies developed using less taxpayer money for R&D, drugs that positively impact the patient lives or have spillover benefits for society or save downstream medical costs, drugs that have solid comparative evidence data, drugs that are a meaningful therapeutic advancement over competitors ... will these drugs be priced in line with that value? Everything I just mentioned, by the way, are things that CMS is supposed to take into account during its negotiations. So, that's what this show is all about. To have this conversation, I invited Dr. Peter Neumann on the podcast because Dr. Neumann (along with his two coauthors, Joshua Cohen and Daniel Ollendorf) just wrote a book about pharmaceutical pricing entitled The Right Price. I convinced Dr. Neumann to come on the show and talk about what the likely impact the IRA will have on these right drug prices. And short version, Dr. Neumann told me that “presumably drugs that offer more therapeutic advances will do better under these negotiations.” Here's a really, really top-line summary of the negotiation provisions that are in the IRA: CMS will negotiate prices on the highest gross spend top 10 Part D drugs in 2026, 15 Part D drugs in 2027, and 15 drugs from Medicare Part B and D for 2028. Small molecule drugs become negotiation contenders after 9 years, and biologics after 13 years. Once a generic or biosimilar comes out (ie, the patent is well and truly expired), then this negotiation provision is no longer in play. Now, CMS is given some discretion over how it's going to do things, and they will issue guidance and figure out how to implement the law over the next couple of years. As with so many things (and Chris Deacon talked about this recently on LinkedIn), it's how that law is operationalized that actually determines if it achieves this “right price” goal and/or—and Dr. Neumann, my guest in this healthcare podcast, makes this point really clearly, too—maybe the point of the law is as much about cost containment, frankly, as it is about achieving value-based “right” prices. And cost containment and value-based pricing are not the same thing. I'm gonna do a show on this coming up. So, what are the likely effects of the IRA pharma price negotiation provisions? And not talking about the whole IRA here and the cadre of other stuff like patient out-of-pocket caps and inflation caps. This show is complicated enough just talking about the negotiation portion and just talking about its potential to achieve pricing based on “value.” Here's a summary of likely impact of Medicare drugs being negotiated, some of which we talk about in this episode. There's “seven-ish” main implications: 1. “Some Medicare patients will benefit substantially from negotiations …, as a reduction in the drug's price will result in lower coinsurance and liability during the deductible phase.” Okay … this makes sense. 2. “Overall, negotiations are projected by the CBO [Congressional Budget Office] to reduce premiums, resulting in lower costs for all Medicare beneficiaries.” References: CBO estimates drug savings for reconciliation. Committee for a responsible federal budget. Accessed April 11, 2023. https://www.crfb.org/blogs/cbo-estimates-drug-savings-reconciliation  Congressional Budget Office. Estimated budgetary effects of Public Law 117-169, to provide for reconciliation pursuant to Title II of S. Con. Res. 14. Published 2022. Accessed April 11, 2023. https://www.cbo.gov/system/files/2022-09/PL117-169_9-7-22.pdf Okay … so, this #2 here is kind of thought provoking, especially when it's unclear at this time whether the negotiated price will refer to the list price, the AWP (average wholesale price), or the rebated price (ie, the price after rebates are applied). There are many, many implications if the negotiated price is before or after rebates, just given how “addicted” plans are to rebates and use the rebates, and cost shifting to patients, in a convoluted and super-inefficient way to try to keep premiums down. Listen to the show with Chris Sloan (EP216) for more on this. 3. There's more incentive to go after biologics than small molecule drugs—obvious, due to the 9-year versus 13-year thing. There's additionally some incentive for rare-disease and orphan drugs, most of which are biologics, in other parts of the IRA. 4. More interest in drugs for non-Medicare markets (ie, drugs for diseases of younger populations, perhaps) 5. Possibly less pharma innovation, fewer drug launches Oh, boy, with this one. Listen to the show with Mark Miller, PhD (EP380), for many, many nuances here. But let me give you a few things to think through, and I'd start with four words: We are chasing Goldilocks. There are two ends of the spectrum, and neither are good. On one end, Pharma charges way too much and the system gets bankrupted while pharma shareholders get rich. On the other side of the spectrum, there's not enough returns for any investors to invest in new drug development. It's all about moderation—finding the sweet spot in the middle—something the healthcare industry has a super hard time with. Bottom line, we want to incent meaningful innovation, drugs that actually work. If we pay a ton of money for drugs that don't work particularly well, then what's the incentive to find good drugs? As per my earlier point, if this legislation does as was intended, then good drugs should get rewarded and less comparatively effective drugs should be less rewarded. Let's cross our fingers, shall we? 6. Will Pharma raise its launch prices because the negotiations center on discounts? A higher price times the discount means a higher discounted price, after all. This one could be exacerbated by the part of the IRA that mandates inflation caps. There is some evidence that higher launch prices are already happening. 7. Manufacturers wait to launch until they have all their indications ready to go. If you didn't understand this, we explain in more detail during the interview. 8. There are incentives for Pharma to jack up commercial prices. Because they're making less money in Medicare, they try to make more money in the commercial market. But as Dr. Neumann says, you'd think that if Pharma could do that, they already would have done it. Or let me say that a different way: You'd think that if Pharma could have raised their commercial prices more than they already have been raising their commercial prices, they would have already done it. So, I think whether cost shifting actually increases here is a sizable question mark. 9. There's also less incentive for Pharma to innovate me-too kinds of drugs. If a drug in the same class for the same disease is being negotiated, then a new drug coming out in that same category might sort of have to charge a price similar to the negotiated price of the other drug. Dr. Peter Neumann, my guest in this episode, has a background in health economics and currently directs a research center that's focused on health economic issues. His group does a lot of work trying to understand the cost effectiveness of drugs and other health interventions. Other shows you should, for sure, listen to here are the ones with Mark Miller, PhD (EP380); Anna Kaltenboeck (EP303); Bruce Rector, MD (EP300); Scott Haas (EP365); and Chris Sloan (EP216). These shows offer context and adjacencies that are extremely relevant right now if you're gonna understand the potential impact of the IRA. Here's a quote from the book The Right Price (written by Dr. Peter Neumann and his coauthors, Joshua Cohen and Daniel Ollendorf) that I thought summed up some of the issues here very nicely: If there existed a Rorschach test for drug prices, it might conjure one of two images. Some people might perceive prices as a compass directing companies to invest in products that people value most. Aligning prices with value is akin to a “true north” orientation of the compass's arrow. Failure to link prices with value sends misleading signals to drug producers. Others might regard drug prices as a wall preventing patients from accessing the drugs they need. For them, the barrier should be as low as possible. But aligning prices with value might have little effect in lowering the wall. How then to accomplish that goal?   You can learn more at cevr.tuftsmedicalcenter.org or by reading The Right Price.   Peter J. Neumann, ScD, is director of the Center for the Evaluation of Value and Risk in Health (CEVR) at the Institute for Clinical Research and Health Policy Studies at Tufts Medical Center and professor of medicine at Tufts University School of Medicine. He is the founder and director of the Cost-Effectiveness Analysis Registry, a comprehensive database of cost-effectiveness analyses in healthcare. Dr. Neumann has written widely on the role of clinical and economic evidence in pharmaceutical decision-making and on regulatory and reimbursement issues in healthcare. He served as co-chair of the 2nd Panel on Cost-Effectiveness in Health and Medicine. He is the author or coauthor of over 300 papers in the medical literature and the author or coauthor of three books: Using Cost-Effectiveness Analysis to Improve Health Care (Oxford University Press, 2005); Cost-Effectiveness in Health and Medicine, 2nd edition (Oxford University Press, 2017); and The Right Price: A Value-Based Prescription for Drug Costs (Oxford University Press, 2021). Dr. Neumann has served as president of the International Society for Pharmacoeconomics and Outcomes Research (ISPOR). He is a member of the editorial advisory board of Health Affairs and the panel of health advisors at the Congressional Budget Office. He has also held several policy positions in Washington, DC, including special assistant to the administrator at the Health Care Financing Administration. He received his doctorate in health policy and management from Harvard University.   09:33 Is it imperative that drugs whose patents are expiring have their prices negotiated? 10:50 “We need innovation; we want to encourage innovation.” 11:01 Does this new law strike a balance between innovation and price regulation? 11:21 How are we assessing cost effectiveness and innovation in the drug space? 12:29 What's the problem with the current drug markets? 13:14 Why can't you rely on the drug market for the cost effectiveness of a drug? 14:13 Why very expensive drugs do not equate to poor value. 15:06 What are the likely outcomes of the IRA? 18:33 How does pharmacy budget factor into high-value drugs? 19:26 “Value-based pricing doesn't mean necessarily lower spending overall.” 22:59 What are the types of drugs that will be excluded from the IRA? 23:22 Who will the law create problems for? 24:44 What have pharmacy benefit managers (PBMs) been doing to move forward with the new law? 26:04 What are plan sponsors doing right now? 28:32 What are the most important value metrics according to Dr. Neumann?   You can learn more at cevr.tuftsmedicalcenter.org or by reading The Right Price.   @PeterNeumann11 discusses #drugprice #negotiations on our #healthcarepodcast. #healthcare #podcast   Recent past interviews: Click a guest's name for their latest RHV episode! Stacey Richter (EP400), Dawn Cornelis (Encore! EP285), Stacey Richter (EP399), Dr Jacob Asher, Paul Holmes, Anna Hyde, Dea Belazi (Encore! EP293), Brennan Bilberry, Dr Vikas Saini and Judith Garber, David Muhlestein  

John Gorman is the founder and Chairman of Nightingale Partners, the first Opportunity Zone fund to invest in social determinants of health interventions with health insurers, states, and provider organizations. He also founded and is the former Executive Chairman of Gorman Health Group. John's work focuses on Medicare, Medicaid, and Affordable Care Act strategy, governance, and turnaround of distressed health plans. Prior to founding his firm, John served as Assistant to the Director of Health Care Financing Administration's (HCFA, now CMS) Office of Managed Care, where he provided day-to-day management and served as the external liaison for the Medicare and Medicaid managed care programs.John's career in Washington began as Press Secretary and Staff Director for U.S. Representative John Conyers, Jr. (D-MI), then Chairman of the Government Operations Committee. John serves on the Board of Directors of Henry Ford Health System's Health Alliance Plan in his birthplace of Detroit, MI, and serves as a Senior Advisor to Premier, Inc., the hospital purchasing cooperative, on Medicare Advantage and Medicaid matters. John Marchica, CEO, Darwin Research GroupJohn Marchica is a veteran health care strategist and CEO of Darwin Research Group. He is leading ongoing, in-depth research initiatives on integrated health systems, accountable care organizations, and value-based care models. He is a faculty associate in the W.P. Carey School of Business and the graduate College of Health Solutions at Arizona State University.John did his undergraduate work in economics at Knox College, has an MBA and M.A. in public policy from the University of Chicago, and completed his Ph.D. coursework at The Dartmouth Institute. He is an active member of the American College of Healthcare Executives and is pursuing certification as a Fellow. About Darwin Research GroupDarwin Research Group Inc. provides advanced market intelligence and in-depth customer insights to health care executives, with a strategic focus on health care delivery systems and the global shift toward value-based care. Darwin's client list includes forward-thinking biopharmaceutical and medical device companies, as well as health care providers, private equity, and venture capital firms. The company was founded in 2010 as Darwin Advisory Partners, LLC and is headquartered in Scottsdale, Ariz. with a satellite office in Princeton, N.J.

Guest Speaker: Roy Ramthun “Mr. HSA” – President and Founder – Circa, November 2020 Roy is a nationally-recognized expert on Health Savings Accounts and consumer-directed health care issues. He led the U.S. Treasury Department's implementation of HSAs after they were enacted into law in 2003. President George W. Bush then tapped Mr. Ramthun to be his health care policy advisor at the White House, where he developed the President's proposals to expand HSAs while overseeing the implementation of the Medicare prescription drug benefit (Part D). He continues to be an advocate for consumerism in health care and is a frequent speaker at conferences and seminars around the country.Mr. Ramthun has over thirty years of health care and public policy experience, both in government and in the private sector. He has served on the staff of the U.S. Senate Committee on Finance and the U.S. Health Care Financing Administration (now known as the Centers for Medicare & Medicaid Services). He also spent eight years with Humana Inc. and led the West Health Policy Center for two years. Mr. Ramthun holds a Master of Science degree in Public Health from the University of North Carolina, and a Bachelor of Science degree from the University of Michigan. https://askmrhsa.com/about-us/ DISCLAIMER AND USE: In no event is this information considered medical, legal, tax, financial, accounting or other professional advice (Please see full disclaimer below). This Podcast Is Subject to the Terms and Conditions of Use (https://conciergemedicinetoday.org/tcpp/) and is recorded/hosted by Concierge Medicine Today, LLC. Concierge Medicine Today, LLC., our representatives, agents or employees accept no responsibility or liability for direct, indirect, special, incidental or consequential damages or financial costs or claims made by the Physician(s) interviewed or our guests. OTHER RESOURCES FOR PHYSICIANS https://members.fordoctorsforum.org/ www.ConciergeMedicineFORUM.com www.ConciergeMedicineToday.org www.ConciergeMedicineToday.net

John Gorman is the founder and Chairman of Nightingale Partners, the first Opportunity Zone fund to invest in social determinants of health interventions with health insurers, states, and provider organizations. He is the Founder and former Executive Chairman of Gorman Health Group. John’s work focuses on Medicare, Medicaid, and Affordable Care Act strategy, governance, and turnaround of distressed health plans. Prior to founding his firm, John served as Assistant to the Director of Health Care Financing Administration’s (HCFA, now CMS) Office of Managed Care, where he provided day-to-day management and served as the external liaison for the Medicare and Medicaid managed care programs. John’s career in Washington began as Press Secretary and Staff Director for U.S. Representative John Conyers, Jr. (D-MI), then Chairman of the Government Operations Committee. John serves on the Board of Directors of Henry Ford Health System’s Health Alliance Plan in his birthplace of Detroit, MI, and serves as a Senior Advisor to Premier, Inc., the hospital purchasing cooperative, on Medicare Advantage and Medicaid matters.John Marchica, CEO, Darwin Research GroupJohn Marchica is a veteran health care strategist and CEO of Darwin Research Group, a health care market intelligence firm specializing in health care delivery systems. He’s a two-time health care entrepreneur, and his first company, FaxWatch, was listed twice on the Inc. 500 list of fastest-growing American companies. John is the author of The Accountable Organization and has advised senior management on strategy and organizational change for more than a decade.John did his undergraduate work in economics at Knox College, has an MBA and M.A. in public policy from the University of Chicago, and completed his Ph.D. coursework at The Dartmouth Institute. He is a faculty associate in the W.P. Carey School of Business and the College of Health Solutions at Arizona State University and is an active member of the American College of Healthcare Executives.About Darwin Research GroupDarwin Research Group Inc. provides advanced market intelligence and in-depth customer insights to health care executives, with a strategic focus on health care delivery systems and the global shift toward value-based care. Darwin’s client list includes forward-thinking biopharmaceutical and medical device companies, as well as health care providers, private equity, and venture capital firms. The company was founded in 2010 as Darwin Advisory Partners, LLC and is headquartered in Scottsdale, Ariz. with a satellite office in Princeton, N.J.

Economies run on healthy people. Healthy people are handcuffed to their employers. Entrepreneurs can only innovated if they can take those handcuffs off without the risk of losing their healthcare. How do we create a more healthy workforce and society? All hard questions that The Chad & Cheese can ask, but no way in HELL have the answer. Enter healthcare expert and former appointee by President Bill Clinton, John Gorman. John is a healthcare rockstar. At 25 years of age he was appointed as Assistant to the Director of Health Care Financing Administration's (HCFA, now CMS) Office of Managed Care during the Clinton administration where was handling a $79 billion portfolio.... That's BILLION with a B kids. Big problems need big brains or AI developed by big brains. Enjoy this Sovren exclusive where the AI is the brain and so human you'll want to take it to dinner.

John Gorman, industry expert and founder and chairman of Nightingale Partners. He was formerly the founder and Chairman of Gorman Health Group as well as Assistant to the Director of Health Care Financing Administration’s (HCFA, now the Centers for Medicare and Medicaid Services, CMS). In the episode, John discusses the importance of social determinants of health interventions to support the most vulnerable patient populations. He also discusses the role that the government and private sectors play in driving industry transformation and the need to move toward value-based care. In light of the COVID-19 pandemic, where should health systems be focusing for a sustainable future? Find all of our network podcasts on your favorite podcast platforms and be sure to subscribe and like us. Learn more at www.healthcarenowradio.com/listen/

This episode of Tuning Healthcare features John Gorman, industry expert and Founder and Chairman of Nightingale Partners. He was formerly the Founder and Chairman of Gorman Health Group as well as Assistant to the Director of Health Care Financing Administration’s (HCFA, now the Centers for Medicare and Medicaid Services, CMS). In the episode, John discusses the importance of social determinants of health interventions to support the most vulnerable patient populations. He also discusses the role that the government and private sectors play in driving industry transformation and the need to move toward value-based care. In light of the COVID-19 pandemic, where should health systems be focusing for a sustainable future? [On the future for health systems] “I think the strategy that's been illuminated especially during this pandemic, … has got to be, you got to get on a path of value-based care. You've got to be accepting risks and you've got to be capitated. Because to continue to try to operate in a fee-for-service environment when elective procedures are all shut down and you're just living on the whims of infection rates right now, getting paid fee-for-service is what kills you in a pandemic. And this isn't going to be the last one of these that we have. … So I think against that backdrop and where payers are certainly marching in formation too is toward value-based care, toward a more accountable care, toward really delivering on very specific performance metrics that are moving from process measures much more oriented toward outcomes. And I think as we've seen in every survey shown of health systems in this last two years…they all agree that one of the absolute top strategic priorities has to be mastering social determinants of health.” – John Gorman, Founder and Chairman of Nightingale Partners. In this episode, John and Lumeris Senior Vice President Nigel Ohrenstein discuss: • The impact of the growing elderly population on the healthcare system • The crisis facing caregivers, low income families, and the uninsured that has been further exposed during the COVID-19 pandemic • The role of the federal and state governments in managing healthcare access and coverage • The importance of moving away from volume-based fee-for-service reimbursement toward value-based payment models • The power of non-clinical interventions to improve population health • Why addressing social determinants of health is critical for truly managing health and improving outcomes. Cited works: • Text Message Alert 1 Sound. Available at http://soundbible.com/2154-Text-Message-Alert-1.html. • ECG Sound. Available at http://soundbible.com/1730-ECG.html. • AM Radio Tuning Sound. Available at http://soundbible.com/2099-AM-Radio-Tuning.html. • Intro music. Gordon Household. August 2019. WAV File.

SDOH have been front and center for America's healthcare for some time now, often highlighting the needs.  But what are ways which can help us find the funds necessary to run the community programs that make a difference?  In this episode, guest John Gorman, Founder and Chairman of Nightingale Partners, shows us a new financing model to tackle SDOH. Host: Corina Paraschiv LinkedIn: https://www.linkedin.com/in/corinamihaelaparaschiv/ Portfolio: https://www.meetcorina.com/  Guest: John Gorman John is the Founder and former Executive Chairman of Gorman Health Group, at the time the industry’s leading consulting practice which spawned almost a dozen entrepreneurial ventures in government health programs. John’s work focuses on Medicare, Medicaid, and Affordable Care Act strategy, governance, and turnaround of distressed health plans. Prior to founding the firm, John served as Assistant to the Director of Health Care Financing Administration’s (HCFA, now CMS) Office of Managed Care, where he provided day-to-day management and served as the external liaison for the Medicare and Medicaid managed care programs. During the 1993 debate on national health care reform, John was chief lobbyist on health care financing issues for the National Association of Community Health Centers, an organization of federally-funded primary care clinics for the medically underserved. John’s career in Washington began as Press Secretary and Staff Director for U.S. Representative John Conyers, Jr. (D-MI), then Chairman of the Government Operations Committee. John serves on the Board of Directors of Henry Ford Health System’s Health Alliance Plan in his birthplace of Detroit, MI, and serves as a Senior Advisor to Premier, Inc., the hospital purchasing cooperative, on Medicare Advantage and Medicaid matters.

This week's episode features conversations on how to improve health care in rural areas and how universities are adapting and supporting their students during the coronavirus pandemic. On the episode, we hear from former Senate Majority Leader Tom Daschle, Gail Wilensky, former administrator of the Health Care Financing Administration (now CMS), and President Walter M. Kimbrough of Dillard University.

The Opportunity Zones incentive is a new community investment tool to encourage long-term investments in low-income urban and rural communities nationwide. Nightingale is accelerating the health care industry's ability to deploy underfunded SDOH benefits by leveraging the innovative financing mechanisms of Opportunity Zones, to catalyze a new marketplace of social service providers. Joining us today is the Founder of Nightingale Partners, John Gorman, to talk about one solution that is good for society, good for patients, and good for business. Show Notes I like to say, social determinants of health are just four fancy words for poverty. We hacked a Republican billionaire tax shelter to try to improve healthcare for black and brown people in inner cities. You can never get to compliant patients who are participating in population health activities unless their basic needs get met. Breaking down silos to sign patients up for all available social services. The Community Health Worker is the linchpin of any successful social determinant intervention. Designing a management services organization to facilitate rent and utility subsidies for thousands of people. Cultural competency and the "execution risk" for new interventions. Case Study: Adult Daycare Centers in Puerto Rico They're dropping $21 million on some big slick analytics package and I was like, " What is that actually going to do for you if you can't stand up an intervention the right way?" That's like putting the greatest scope in the world on a really rusty rifle. If you give me $21 million worth of social workers, I'll change the world. John Gorman, Founder John is the Founder and former Executive Chairman of Gorman Health Group, at the time the industry's leading consulting practice which spawned almost a dozen entrepreneurial ventures in government health programs. John's work focuses on Medicare, Medicaid, and Affordable Care Act strategy, governance, and turnaround of distressed health plans. Prior to founding the firm, John served as Assistant to the Director of Health Care Financing Administration's (HCFA, now CMS) Office of Managed Care, where he provided day-to-day management and served as the external liaison for the Medicare and Medicaid managed care programs. During the 1993 debate on national health care reform, John was chief lobbyist on health care financing issues for the National Association of Community Health Centers, an organization of federally-funded primary care clinics for the medically underserved. John's career in Washington began as Press Secretary and Staff Director for U.S. Representative John Conyers, Jr. (D-MI), then Chairman of the Government Operations Committee. John serves on the Board of Directors of Henry Ford Health System's Health Alliance Plan in his birthplace of Detroit, MI, and serves as a Senior Advisor to Premier, Inc., the hospital purchasing cooperative, on Medicare Advantage and Medicaid matters. Nightingale Partners LLC  Nightingale Partners LLC is a Qualified Opportunity Zone (OZ) fund and advisory firm that identifies, collaborates and invests in market-ready health care initiatives in OZs nationwide. NP focuses on designing evidence-based, targeted, non-clinical interventions addressing Social Determinants of Health (SDOH) for Medicaid and Medicare enrollees through creative partnerships with High-Net Worth Individuals, Institutional Investors, Government Agencies and Strategic Health Plans/Providers. Resources, Links, and Related Episodes Nightingale Partners https://www.linkedin.com/company/nightingale-partners-ll https://www.nightingalepartners.org/ John Gorman https://www.linkedin.com/in/john-gorman-098b265 https://twitter.com/johngorman18?lang=en

On this week's episode, we hear from some of the co-chairs of BPC's Future of Health Care Initiative as they outline a bipartisan path forward to fix America's current health care system. Among those speaking are former Senate Majority Leader Tom Daschle, Gail Wilensky, former administrator of the Health Care Financing Administration, and Andy Slavitt, former acting administrator of the Centers for Medicare and Medicaid Services. Also on the episode, the results of a new BPC report on energy innovation and how registered apprenticeships can provide economic opportunities in the early childhood workforce.

In this health care podcast, I speak with John Gorman, who is a government-sponsored health programs guru. He’s also the founder of a newly minted organization called Nightingale that (spoiler alert) we discuss toward the end of our conversation. I just want to interject right here that I, for one—but I’m sure John would agree—do not believe that Medicare Advantage (MA) is, as is, perfectly terrific and devoid of problems. There are, of course, well-known issues with coding, the whole exaggerated diagnoses for higher reimbursements thing … then there’s the whole potentially wasteful quotas payments and the restrictive networks of doctors cited issues. We don’t get into these during our conversation, focusing instead on comparing MA to FFS (fee-for-service) Medicare. From there, we get into advice for independent physicians in rural hospitals and then we wind up at price gouging by nonprofit hospitals. John’s points are insightful as always, and I guarantee he will give you a lot to think about. You can learn more and connect with John on LinkedIn. John Gorman is the founder and former executive chairman at Gorman Health Group (GHG). For 22 years he led the development of the industry’s leading consulting practice and several entrepreneurial ventures in government health programs. John’s work focuses on Medicare Advantage, Medicaid, and Accountable Care Act strategy, governance, and social determinants of health. John considers himself a defender and fixer of health insurance coverage, especially Medicare, Medicaid, and subsidized individuals served by health plans. He has strong opinions and relies on evidence and sound policy. Prior to founding GHG in 1996, he was appointed by President Clinton as the first assistant to the director of the Health Care Financing Administration’s (now Centers for Medicare and Medicaid Services) Office of Managed Care. After leaving GHG in July 2018, John founded and currently serves as the CEO and chairman of Nightingale Partners, an organization dedicated to helping payers and providers make an impact on social influences that prevent patients from achieving healthy, happy lives. Nightingale Partners is a qualified Opportunity Zone investment firm focused on social determinants of health. John continues to speak regularly at about two dozen industry conferences across the country each year and is regularly quoted in the trade press and national media. He serves on the board of directors of Henry Ford Health System’s Health Alliance Plan in his birthplace of Detroit and serves as a senior adviser on Medicare Advantage and Medicaid to Premier Inc., the hospital purchasing cooperative. John serves on the editorial advisory boards of several industry publications, including Bloomberg Government. 01:37 The quality measures being used to assess value. 04:00 “Half of the rating is attributable to the member experience.” 04:29 Are the ways that FFS and Medicare Advantage value-based care measures are weighted legitimate? 07:59 Insurance carrier profitability. 08:33 Medicare for all to Medicare Advantage for all—how John sees this morphing into the future. 11:07 Is insurance profitability at the expense of the rest of the country? 13:47 “A more rigorous antitrust approach to hospital mergers would certainly help.” 15:10 “Get bigger and get more sophisticated in … the value you bring to the table.” 16:49 “There’s always strength in numbers.” 20:35 EP202 with Frazer Buntin.23:28 “If you’re not adapting, you’re dying in this environment if you’re a hospital.” 24:37 John’s advice to rural hospitals. 27:44 EP219 with Arshad Rahim. 28:27 What Nightingale is and what they do. You can learn more and connect with John on LinkedIn. Check out our newest #healthcarepodcast with @JohnGorman18. #healthcare #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging The #quality #measures being used to assess value with @JohnGorman18. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging “Half of the rating is attributable to the member experience.” @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging Are the ways that #FFS and #MedicareAdvantage #valuebasedcare measures are weighted legitimate? @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging #Insurancecarrierprofitability. @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging How will #medicareforall morph into #medicareadvantage for all? @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging Is #insuranceprofitability at the expense of the rest of the country? @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging “A more rigorous antitrust approach to hospital mergers would certainly help.” @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging “Get bigger and get more sophisticated in … the value you bring to the table.” @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging “There’s always strength in numbers.” @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging “If you’re not adapting, you’re dying in this environment if you’re a hospital.” @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging What Nightingale is and what they do? @JohnGorman18 discusses. #healthcare #healthcarepodcast #podcast #digitalhealth #medicare #qualitymeasures #medicareadvantage #pricegouging

In this episode, Revel CEO Jeff Fritz is talking with Rev Up 2019 speaker, John Gorman. John is the Founder and Former Executive Chairman at Gorman Health Group. Prior to founding GHG in 1996, he was appointed by President Clinton as the first Assistant to the Director of Health Care Financing Administration’s Office of Managed Care (now CMS). He is currently the CEO of Nightingale Partners and speaks regularly at healthcare conferences across the country. We're excited to welcome John to the Rev Up 2019 conference taking place in Minneapolis, MN August 14-15th. For more information about the event and to view the complete agenda visit: www.revupshow.com

John Gorman is founder and executive chairman at Gorman Health Group (GHG). In this role, he has led the development of the industry's leading consulting practice and several entrepreneurial ventures in government health programs. John's work focuses on Medicare, Medicaid, and Affordable Care Act strategy, governance, and turnaround of distressed health plans. Prior to founding the firm, John served as assistant to the director of Health Care Financing Administration's Office of Managed Care, where he provided day-to-day management and served as the external liaison for the Medicare and Medicaid managed care programs. During the 1993 debate on national health care reform, John was chief lobbyist on health care financing issues for the National Association of Community Health Centers, an organization of federally funded primary care clinics for the medically underserved. John's career in Washington began as press secretary and staff director for US Representative John Conyers, Jr (D-MI), then chairman of the Government Operations Committee. 00:19 How Pharma and suppliers to providers are being impacted by needing to produce outcomes. 00:31 Future huge sources of revenue for manufacturers. 00:37 Cutting out the PBM. 01:28 “They are basically rebate machines.”—John 02:23 “How far do you want to push the disruption of your biggest customers?”—Stacey 02:36 “All they're going to have to do is wait a couple years.”—John 04:03 Getting away from rebates and into a different business model altogether. 05:13 “It's not skin in the game, and it's not a game—this is people's health care.”—John 06:40 EP189 with Alex Jung of Ernst & Young.

John Gorman is founder and executive chairman at Gorman Health Group (GHG). In this role, he has led the development of the industry's leading consulting practice and several entrepreneurial ventures in government health programs. John's work focuses on Medicare, Medicaid, and Affordable Care Act strategy, governance, and turnaround of distressed health plans. Prior to founding the firm, John served as assistant to the director of Health Care Financing Administration's Office of Managed Care where he provided day-to-day management and served as the external liaison for the Medicare and Medicaid managed care programs. During the 1993 debate on national health care reform, John was chief lobbyist on health care financing issues for the National Association of Community Health Centers, an organization of federally-funded primary care clinics for the medically underserved. John's career in Washington began as press secretary and staff director for US Representative John Conyers, Jr (D-MI), then chairman of the Government Operations Committee. 01:22 The impact value-based payments have made. 01:50 The star-ratings program in Medicare Advantage. 04:00 How value-based payments has improved the quality of care. 09:23 How substandard care factors into star-ratings in Medicare Advantage. 10:40 Medicare Advantage as the most regulated program, but also the most enticing for insurance companies. 12:52 How Medicare Advantage plans are making more than commercial plans. 13:07 “There really was a tipping point a few years ago…” 13:54 What health care providers with a number of Medicare patients need to know. 15:54 “You ignore these trends and these demographics at your peril.” 17:42 Risk adjustment. 20:07 “The highest quality is provided by providers that share risk with their Medicare Advantage plans.” 21:08 Are fee-for-service plans able to achieve the quality that a Medicare Advantage plan is looking for? 22:41 “It's only a matter of time for small practices, unless they band together…” 23:08 Proving high quality care vs the administrative burden. 24:44 MIPS vs APMs. 26:14 “APMs and bundles are going to be major drivers of payment in traditional fee-for-service in health care.” 27:00 Value-based payments - inexorable? 30:15 Find out more information at gormanhealthgroup.com, or follow John Gorman on LinkedIn and Twitter.