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Indiana – It is the best of times, and the worst of times

By MIKE MAGEE

“Hoosiers receive heroes’ welcome in return to Bloomington” screamed last week’s ESPN headline, as IU claimed top spot in college football nationwide. It’s been awhile since sports elevated that state’s mood.

In his classic review of the famous movie, “The Hoosiers,” Roger Ebert writes, “This is a movie about a tiny Indiana high school that sends a team all the way to the state basketball finals in the days when schools of all sizes played in the same tournaments and a David could slay a Goliath. That’s still the case in Indiana.”

That final sentence came to mind last month, as the Midwestern state with a population of around 7 million (17th in the nation)  punched above its political weight and landed headlines like this one on December 11, 2025 in The Hill – “Indiana Senate rejects new House map, defying Trump.”

Some facts were clear: Twenty-one Indiana state senators had joined all 10 Democratic state senators to defeat a proposed redistricting map that would have assured a gain of 2 additional House of Representative seats for Republicans in the 2026 mid-term elections. But most political pundits misread why they did it, and ignored a crucial economic report from 10 months earlier that informed their actions. More on that in a moment.

First a bit of history. A century ago, Eli Lilly Jr. (grandson of the founder of the famous pharmaceutical giant Lilly & Co.) cut a deal with the University of Toronto to be the sole supplier of their life-saving drug – insulin. Headquartered in Indianapolis, Indiana, they were ideally positioned because the state’s three economic pillars were manufacturing, agriculture, and health sciences.

To secure adequate supply of insulin was both a scientific and logistic challenge of historic proportions. Eli Jr.’s focus on line manufacturing helped. Raw material demands required the design of a refrigerated railway support system dead ending at Lilly manufacturing sites. This was made necessary since purifying 8 ounces of insulin required two and a half tons of beef or pork pancreas readily available from state farms. Sourcing the raw materials locally was not a problem. At the time, 86% of the state’s lands were controlled by 195,786 farming families committed to farming (including livestock management and slaughter houses).

Fast forward a century and the state remains heavily dependent on its tripartite pillars – manufacturing, agriculture and health sciences. That was the message broadcast with great political effect on April 15, 2025 in a first ever economic forecast update from Muncie, Indiana, the home of Ball State University and its’ well-respected Center for Business and Economic Research led by Michael J. Hicks, PhD. For over 50 years CBER has published “data-rich, nonpartisan research relevant to communities and businesses throughout Indiana.” Their reputation is built on one word – trust.

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A $2,000 Voucher and 600 Patients: The Math Behind Fixing Care

When I was at HLTH last October Bradley Bostic invited me on his BoomBostic Health podcast. I was in the mood for ranting about the health care system and promoting my desire for getting everyone concierge level primary care. Bradley was very generous in giving me a mike and a lot of rope. I am embedding the youtube version and if you want just audio it’s here. (I was also losing my voice so there’s a cleaned up transcript below)–Matthew Holt

Bradley:

Well, hello and welcome back to another episode of Boombostic Health in the Wild here at HLTH 2025 in Las Vegas. I’m thrilled to have Matthew Holt with me, who is the leader at The Health Care blog, a blog I follow, and I appreciate you being here, Matthew. 

Matthew

Bradley, thank you very much. I count my readers, you know, on about two hands, so I want to keep you in good health. I have a little joke. We used to have a podcast that actually wasn’t that well-followed called the THCB gang and one of my colleagues on THCB gang was at a conference and a guy in the row behind him said “oh I recognize your voice, my father used to listen to the podcast but then he died.” When my colleague told me the story I said, we don’t have enough listeners and subscribers to lose them like that –  we’ve got to keep them alive in order to keep the podcast going!

Bradley

Well, Boombostic Health was really born out of my pension for building companies in the health tech world and investing in companies. When we first started this. I wasn’t sure if anybody would listen to it. My mom passed away from cancer 25 years ago. So, I knew she wouldn’t be listening to it unfortunately. But that was a big thing that inspired me to get into healthcare. And lo and behold, there is a really interested audience out there that wants to know how innovation is transforming our broken health care system. And clearly with your background with Health 2.0 and The Health Care Blog, this is an area that you’re focused on. And I think you said you have two easy steps. Oh no, two steps, not necessarily easy to fix healthcare. 

Matthew

So the preamble to this is I’ve been doing this for a long time. I came to America in 1989.

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Hospitals can soften the blow of Medicaid’s retroactive coverage change, if they choose to

By BRIAN STANLEY

Patients waiting on Medicaid enrollment face more bills, while Congress touts that as cost savings. Hospitals need to choose their stance.

Medicaid covers the lion’s share of short- and long-term health care expenses for low-income, older, and/or disabled Americans. Until now, the program paid for care received up to three months before someone filed for Medicaid, as long as the person was eligible at the time. That grace period has long been a safety net for people who fall ill before navigating the maze of Medicaid enrollment.

In a quiet change tucked into the “Big Beautiful Bill,” lawmakers shrunk that window by one to two months, depending on the state.

Now, for adults in Medicaid expansion programs, retroactive coverage stops at one month before enrollment. For traditional Medicaid enrollees, it’s two months.

The Congressional Budget Office estimates this change will “save” the government billions over the next decade. But those “savings” don’t reflect fewer illnesses or better care. Instead, they are unpaid bills and costs that move downstream to patients, nursing homes, and other parts of the health care system.

These changes can impact any of us.

Any health event can set off a chain of care –  hospitalization, rehab, then long-term nursing home placement – that easily stretches past 30 or 60 days. Under the new rules, that early care will fall outside Medicaid’s reach: the first month or two of costs now sit squarely with the patient or facility.

Still, this change is especially harmful for dual eligible beneficiaries. Americans on Medicare who become eligible for Medicaid enrollment – think older adults or people with disabilities – are at particular risk.

This scenario plays out often: a person has Medicare and then experiences an illness or injury that drives their assets down. They then become eligible for Medicaid, in addition to holding their Medicare enrollment. For these Americans, the shift in the “Big Beautiful Bill” means that they face significant bills while they wait for their Medicaid enrollment to be completed.

We know that this population, and realistically, all Americans, suffer when retroactive coverage is taken away from them.

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It’s Only a Subsidy If You’re Poor

By KIM BELLARD

Even though most ACA enrollees/would-be enrollees have made their 2026 enrollment decisions assuming the expanded premium subsidies are not going to be renewed, the renewal of those subsidies is not entirely dead. Last week the House narrowly passed an extension, relying on a discharge petition and 17 Republican Congressmen willing to go against their leadership. Meanwhile, in the Senate, Senator Bernie Moreno (R-OH), of all people, is leading an effort to come up with a bill to expand them as well.

Whether it will eventually get passed is uncertain, as is how/when it might be reconciled with the House bill, and the President might just veto whatever extension might manage to emerge. The expanded subsidies aren’t dead yet, they’re just “mostly dead,” as Miracle Max would say.

The seeming indifference to the concerns of over twenty million ACA enrollees is appalling, but in character. This is an Administration and a Republican Congress that doesn’t like SNAP, Medicaid, school lunches, or aid to starving people in Third World countries, among other things. If you’re poor, they think, too bad; get a job, or a better job, and pull yourself up yourself. No handouts.

If they were against federal subsidies generally, out of fiscal prudence or other guiding principles, I could respect it. I wouldn’t agree with it, but it’d at least be intellectually honest. The trouble is, they’re not against subsidies per se; they just don’t like them going to poor people. I.e., the ones who need them most.

What set me off on this was a ProPublica/High Country News investigation into grazing on public lands. If you live in the East you probably don’t think much about either grazing or public lands, but if you live in the West you are probably very familiar with both. Almost 50% of land in Western states is federally owned. It ranges from 85% in Nevada to 4% in North Dakota. Almost half of California is federal land. You might be forgiven if you assume federal lands must be national parks, but they are small relative to land managed by the Bureau of Land Management (BLM), the U.S. Fish & Wildlife Service (FWS), and the U.S. Forest Service (USFS).

According to ProPublica: “The federal government allows livestock grazing across an area of publicly owned land more than twice the size of California, making ranching the largest land use in the West.” Well, you might think, that’s not inherently bad; we might as well use the land for something, maybe even make a little money from it. That’s the problem; the federal government is practically giving it away. Its analysis found that the grazing fees charged amount to a 93% discount relative to the market rate. You read that right: ninety three percent. That’s not a discount, that’s a giveaway.

OK, that’s eye-opening, but if it helps a bunch of ranchers who are struggling to survive, maybe that’s not so bad; ranching goes back to frontier days and has a certain cowboy appeal. Unfortunately, that stereotype isn’t quite true.

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Jim Gallic shows off Wondr Health

Jim Gallic is Chief Growth Officer at Wondr Health, a company specializing in creating the behavior change required for weight loss. He was a satisfied client who lost a ton of weight (see that before and after photo on the right!) and changed his eating habits completely using Wondr (no drugs involved!). Later in life he joined the company. I spoke to him and got a tour of the experience. A great demo about how Wondr works, and about how GLP1s are altering the conversation. Jim’s stance is that the behavior change works first to create a readiness program for the medication, and then the weight might stay off when the medication ends. Matthew Holt

Even When Healthcare Has a Clear Price Tag, Are We Getting What We Pay For?

By OWEN TRIPP

Move over, GLP-1s. This year the healthcare spotlight is on alternative plan design. Alternative health plans offer cost transparency and a consumer-friendly shopping experience. But can the capabilities under the hood deliver on quality and value? Though it may not sound buzzworthy, it has the potential to trigger a seismic shift in the commercial insurance market.

After years of disappointing returns and unmet promises from traditional insurance models, innovators and big-name insurers themselves are doubling down on alternative plans aimed at reducing healthcare costs through preferred care pathways with transparent pricing. Though these plans come in many flavors, common features include tiered networks, variable copays, care steerage, and an emphasis on primary and virtual care — often packaged in a digital-first (and AI-powered) “shopping” experience. 

Alternative plans seem like a win-win. For consumers struggling with surprise bills and medical debt, replacing confusing deductibles and coinsurance with predictable copays offers much-needed peace of mind. For employers facing the highest increase in healthcare costs in 15 years, getting their workforce on a trusted path to quality feels like a sure bet.

There’s a catch, though: Alternative plans won’t help much if they lead people to the same old, fragmented healthcare experience. Innovative cost-sharing and a slick front-end experience must be backed by high-quality clinical care, dynamic population health management, and personalized engagement that represent a significant upgrade from what’s been delivered to date.

Otherwise, signing up for an alternative plan will be a lot like buying a shiny new smartphone, only to discover that its operating system only supports a handful of outdated apps.

Alternative plans: what must be under the hood?

While cost transparency and a streamlined shopping experience offer immediate benefits to consumers, it’s the deeper capabilities and levers under the hood of alternative plans that will drive long-term value and create an alternative model worth embracing.

1. A primary care-led integrated care model

Most insurer-led alternative plans are built on top of existing care delivery networks (and existing provider contracts), often leading people to well-worn pathways and settings, including those that have produced status-quo outcomes for people and minimal cost improvement for employers.

Alternative plans need to create new dynamics around primary care, removing access barriers, creating flexibility and incentives, and repositioning expectations for provider interactions. Simply doing more of the same is inadequate. A true primary care-led plan is one that creates new channels and opportunities, dedicates time for immersive one-to-one discovery, and empowers physicians to lead people to quality across the network based on individual needs — supported by data, technology, and system-wide connections.

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Brick by Brick by (Smart) Brick

By KIM BELLARD

I’m an innovation junkie, the further out there the better, but every so often it’s good to be reminded that just because a company has been around for a while, innovation is still possible.

Two examples: LEGO® and Kodak.

Let’s start with LEGO. If you are around any small children – and perhaps not even all that small – you probably have seen them playing with Legos. Legos have been around, in various incarnations, for longer than I’ve been alive, and that’s saying something. Most adults watching kids assemble their Legos probably have two reactions: “gosh, I wish they’d make them even more complicated” (note to the oblivious reader – that was sarcastic), and “well, at least they’re not on their screens.”

So I bet a lot of us have a slightly surprised reaction to Lego’s announcement Monday Jan 6th to CES 2026: LEGO SMART Play™.

The key innovation is the SMART Brick, which “is packed with technologies that bring play to life including sensors, accelerometers, light sensing and a sound sensor as well as a miniature speaker driven by an onboard synthesiser, and much more, in addition to easy wireless charging.” All that is powered by a custom chip, which is smaller than one of the studs on a LEGO brick.

The LEGO Group states: “Without any setup, SMART Bricks are magically ‘aware’ of each other’s positions and orientations in 3D space, thanks to a novel, high-accuracy, magnetic positioning system. They can also communicate via a self-organizing network that adapts to play. Advanced onboard systems let SMART Bricks comprehend and interact with each other, as well as the fans building with them.” “Magic” in this context meaning Bluetooth.

Nerdist calls it “the most exciting innovation in screenless play ever,”  

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The Dimensions of Artificial Intelligence in the Healthcare Industry

By STEVEN ZECOLA

On December 19th, the Department of Health and Human Services (“HHS”) issued a Request for Information seeking to harness artificial intelligence (“AI”) to deflate health care costs and make America healthy again.

As described herein, AI can be used in many dimensions to help lower healthcare costs and improve care. However, to achieve significant breakthroughs with AI, HHS will need to completely revamp the regulatory approach to drug discovery and development.

Dimension #1. Incorporation of AI into Drug Discovery

The biggest benefit to the healthcare industry’s performance from AI is achievable from drug discovery. Accounting for the costs of failures, the average FDA drug approval costs society almost $3 billion and takes decades to reach the market from its inception in the lab. 

In contrast, AI identifies potential treatments much faster than traditional methods by processing vast amounts of biological data, uncovering hidden causal relationships, and generating new actionable insights.

AI is particularly promising for complex, multifactorial conditions – such as neurodegenerative diseases, autism spectrum disorders, and multiple chronic illnesses – where conventional reductionist approaches have failed.

In the short-run, HHS should direct its grants toward AI-generated basic research, with a particular emphasis on the hard-to-solve illnesses. At the same time, the FDA should be putting into place a new approval system for AI-initiated programs to enable breakthrough treatments in a compressed timetable. 

Dimension #2. Incorporation of AI into the Drug Development Process

Simply relying on AI for drug discovery, while subjecting its advances to the current approval process would undermine the use of the technology. 

Rather, improvements from AI can already be had in fulfilling the exhaustive regulatory documentation requirements, which today add up to as much as 30% of the cost of compliance.

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Father Christmas Reminds Us We Can Do Better Than This

By MIKE MAGEE

The Ghost of Christmas Past, in the form of Surgeon General C. Everett Koop, has returned this season to torture one RFK Jr who refuses to fully share life saving vaccines with children. In the encounter, the ghostly Koop reviews a time 37 years ago when citizens came together to celebrate separating scientific fact from fiction with life-saving effects.

Beginning in 1988, the United States, along with the rest of the world, had formally acknowledged and celebrated World AIDS Day on December 1st each year – that is until 2025. At President’s Trump’s direction the State Department, and with HHS support, turned their back on an inconvenient truth – the Republican early record on HIV/AIDS. Let’s channel the truth-telling Surgeon General from Christmas past and remember this telling story.

On June 5, 1981, the CDC reported 6 cases of Pneumocystis carinii associated with a strange immune deficiency disorder in California men. Drs. Michael Gottlieb and Joel Weismann, infectious disease experts who delivered care routinely for members of the gay population in Los Angeles, had alerted the CDC. Inside the organization, there was a debate on how best to report this new illness in gay men.

The vehicle that the CDC chose was a weekly report called the Morbidity and Mortality Weekly Report or MMWR. So as not to offend, the decision was made to post the new finding, not on page 1, but on page 2, with no mention of homosexuality in the title. Almost no one noticed.

On April 13, 1982, nine months after the initial alert, Senator Henry Waxman held the first Congressional hearings on the growing epidemic. The CDC testified that tens of thousands were likely already infected. On September 24, 1982, the condition would for the first time carry the label, AIDS – acquired immune deficiency syndrome.

The new Surgeon General, C. Everett Koop’s focus at the time, along with the vast majority of public health leaders across the nation, was not on a new emerging infectious disease, but rather on the nation’s chronic disease burden, especially cardiovascular disease and cancer being fed by the post-war explosion of tobacco use. He had already surmised that the power of his position lie in communications and advocacy.

One month after his swearing in, he appeared on a panel to release a typically boring Surgeon General update report on tobacco. He was not intended to have a big role. When Koop rose to deliver what all thought would be brief, inconsequential remarks, he wasted no time disintegrating the lobbyist organization, the Tobacco Institute. For print journalists in the audience, he was clear, concise and quotable. For broadcast journalists, he was a dream come true – tall, erect with his Mennonite beard, in a dark suit with bow tie, exuding a combination of extreme confidence and legitimacy mixed with “don’t mess with me” swagger.

As Koop would later say, after that, “I began to be quoted as an authority. And the press from that time on was all on my side… I made snowballs and they threw ‘em.” The other thing that Koop noticed early was that the Reagan Administration didn’t shut him down. That was surprising since Koop’s major supporter in a year long confirmation battle (the AMA opposed his appointment) was NC arch-conservative Senator Jesse Helms.

Add to Jesse’s wrath, R.J. Reynold’s CEO, Edward Horrigan, complained directly to Reagan about Koop’s “increasingly shrill preachments. Cigarette consumption in the US was in free fall. By 1987, 40 states would have laws banning smoking in public places; 33 states had bans in public transportation; and 17 already had eliminated workplace smoking.

Still Reagan didn’t shut him down. Now everyone from public schools to medical groups to women’s associations to civic enterprises wanted him. And beginning in late 1982, he arrived in full regalia, in a magnificent Public Health Service, Vice-Admiral’s uniform with ribbons and epaulettes. And his aide, also in uniform, always carried with him a bag of buttons for distribution which read, “The Surgeon General personally asked me to quit smoking.”

But in the most pressing public health challenge of the day, HIV/AIDS, the department was AWOL. Koop was actively sidelined by top Administration officials. Not surprisingly, the situation deteriorated rapidly. Everyone was feeling the heat, including the CDC, who removed funding for AIDS education after being accused of promoting sodomy by conservatives.

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Why AI Still Isn’t Fixing Patient Referrals—And How It Could

By NAHEEM NOAH

A Call from the Black Hole

Three months into building Carenector’s facility-to-facility platform, I got a call that crystallized everything wrong with healthcare referrals. A hospital social worker, who was already using our individual patient platform to help families find care, had been trying to coordinate an institutional placement for an 82-year-old stroke patient for six days. She’d made 23 phone calls. Sent 14 faxes. The patient was medically cleared but stuck in an acute bed costing $2,000 per day because no one could confirm which skilled nursing facilities had open beds, accepted her Medicaid plan, and had stroke rehabilitation capacity.

“I love what you built for patients,” she told me, “but when I need to do a facility-to-facility transfer, I’m back to faxing. Can’t you fix this workflow, too?”

She wasn’t wrong. We’re in 2025, and despite billions poured into health IT and breathless AI promises, referring a patient often feels like stepping back into 1995. Earlier this year, THCB’s own editor Matthew Holt documented his attempt to navigate specialist referrals through Blue Shield of California. The echocardiogram referral his doctor sent never arrived at the imaging center. When he needed a dermatologist, his medical group referred him to a provider who turned out not to be covered by his HMO plan at all. “There is a huge opportunity here,” Holt concluded after his odyssey through disconnected systems, “even though we’ve got now a lot of the data…to integrate it and make it useful for patients.”

Clinicians make over 100 million specialty referrals annually in the U.S., yet research shows that as many as half are never completed.

Here’s what we’ve learned after a year of operation: we built a consumer-facing platform that helps individuals and families find care providers matching their needs, insurance, and location—it now serves over 100 daily users, including patients, social workers, and discharge planners. But solving individual care searches is only half the battle. The institutional referral workflow—hospital to skilled nursing facility, SNF to rehab center, clinic to specialist—remains trapped in fax machines and phone tag because no one redesigned the actual coordination process.

That’s what we’re building now. And the question haunting us isn’t why we don’t have better tools? It’s why billions in AI investment left the institutional referral workflow virtually unchanged?

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