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What the Walmart Exit from Primary Care Means

By JEFF GOLDSMITH

There has been a lot of commentary on the largest “disrupter” candidate in healthcare, retail giant Walmart, throwing in the towel on their primary care clinic and virtual health businesses. As someone who has watched “retail health” for close to forty years, Walmart’s decision did not surprise me. This is disciplined company that has chosen its niches in healthcare carefully. And the fact that they could not make primary care work with their customer base makes all the sense in the world.

I am a Walmart shopper.  I visit my local Walmart at least once a week, and buy all my commodity items there, where they are cheaper than anywhere else in town. I also buy my drugs at Walmart, and got all my immunizations (including four COVID shots) from their pharmacy. I love my local Walmart- linoleum, fluorescent lighting and all.

The shoppers in Walmart that I see every week are not “poor”. They are a cross section of the community I live in. If I am accused of a crime, they are the “jury of my peers” that I will see in court. What I see in Walmart:  signs of serious family financial stress, a product of a near twenty percent increase in the cost of everything since the pandemic began.  They are in Walmart for the same reason I am: they hate wasting money and their shopping dollar goes further in Walmart than anywhere else in the community. I will wager that every single uninsured person in the US, perhaps more than 32 million after the post-COVID Medicaid purge, is a Walmart shopper!

Walmart never articulated exactly the strategy behind its clinics. Primary care was never going to be profitable as a stand alone product, but rather was going to be a loss leader to something else:  more prescriptions for its pharmacy, (like CVS?),  more pull-through from products required by diagnoses, longer store visits. Or, as some suggested, Walmart’s clinics could have been a potential entry point into a yet-to-be-acquired Medicare Advantage plan (Humana or CIGNA were both in play), or a collaboration with MA giant, United Healthcare. Whatever the benefits expected, early losses far exceeded forecasts.

Walmart clearly underestimated the revenue cycle overhead associated with accepting Medicaid or Medicare, despite retaining OptumInsight to help with their revenue cycle issues. Walmart also likely overestimated both volumes and the cash yield on what they intended to be  $40 primary care visits. Many health plans unthinkingly apply a copayment to primary care visits, an increasingly potent demand destroyer in this inflationary age. That copay or the full $40 for the abovementioned uninsured folks was going to have to compete for increasingly scarce paycheck dollars with everything in that cart. In that competition, medical care is probably going to end up being deferred, until it becomes unavoidable.  And when it is unavoidable, they will go to the “unavoidable” healthcare place, their local hospital ED. 

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Getting the Future of Health Care Wrong

By KIM BELLARD

Sure, there’s lots of A.I. hype to talk about (e.g., the AI regulation proposed by Chuck Schumer, or the latest updates from Microsoft, Google, and OpenAI) but a recent column by Wall Street Journal tech writer Christopher Mims – What I Got Wrong in a Decade of Predicting the Future of Tech —  reminded me how easily we get overexcited by such things.   

I did my own mea culpa about my predictions for healthcare a couple of years ago, but since Mr. Mims is both smarter and a better writer than I am, I’ll use his structure and some of his words to try to apply them to healthcare.  

Mr. Mims offers five key learnings:

  1. Disruption is overrated
  2. Human factors are everything
  3. We’re all susceptible to this one kind of tech B.S.
  4. Tech bubbles are useful even when they’re wasteful
  5. We’ve got more power than we think

Let’s take each of these in turn and see how they relate not just to tech but also to healthcare.

Disruption is overrated

“It’s not that disruption never happens,” Mr. Mims clarifies. “It just doesn’t happen nearly as often as we’ve been led to believe.”  Well, no kidding. I’ve been in healthcare for longer than I care to admit, and I’ve lost count of all the “disruptions” we were promised.

The fact of the matter is that healthcare is a huge part of the economy. Trillions of dollars are at stake, not to mention millions of jobs and hundreds of billions of profits. Healthcare is too big to fail, and possibly too big to disrupt in any meaningful way.

If some super genius came along and offered us a simple solution that would radically improve our health but slash more than half of that spending and most of those jobs, I honestly am not sure we’d take the offer. Healthcare likes its disruption in manageable gulps, and disruptors often have their eye more on their share of those trillions than in reducing them.

For better or worse, change in healthcare usually comes in small increments.

Human factors are everything

“But what’s most often holding back mass adoption of a technology is our humanity,” Mr. Mims points out. “The challenge of getting people to change their ways is the reason that adoption of new tech is always much slower than it would be if we were all coldly rational utilitarians bent solely on maximizing our productivity or pleasure.” 

Boy, this hits the healthcare head on the nail. If we all simply ate better, exercised more, slept better, and spent less time on our screens, our health and our healthcare system would be very different. It’s not rocket science, but it is proven science.

But we don’t. We like our short-cuts, we don’t like personal inconvenience, and why skip the Krispy Kreme when we can just take Wegovy? Figure out how to motivate people to take more charge of their health: that’d be disruption.

We’re all susceptible to this one kind of tech B.S.

Mr. Mims believes: “Tech is, to put it bluntly, full of people lying to themselves,” although he is careful to add: “It’s usually not malicious.” That’s true in healthcare as well. I’ve known many healthcare innovators, and almost without exception they are true believers in what they are proposing. The good ones get others to buy into their vision. The great ones actually make some changes, albeit rarely quite as profoundly as hoped.

But just because someone believes something strongly and articulates very well doesn’t mean it’s true. I’d like to see significant changes as much as anyone, and more than most, and I know I’m too often guilty of looking for what Mr. Mims calls “the winning lottery ticket” when it comes to healthcare innovation, even though I know the lottery is a sucker’s bet.

To paraphrase Ronald Reagan (!), hope but verify.

Tech bubbles are useful even when they’re wasteful

 Healthcare has its bubbles as well, many but not all of them tech related. How many health start-ups over the last twenty years can you name that did not survive, much less make a mark on the healthcare system? How many billions of investments do they represent?

But, as Mr. Mims recounts Bill Gates once saying, “most startups were “silly” and would go bankrupt, but that the handful of ideas—he specifically said ideas, and not companies—that persist would later prove to be “really important.”’  

The trick, in healthcare as in tech, is separating the proverbial wheat from the chaff, both in terms of what ideas deserve to persist and in which people/organizations can actually make them work. There are good new ideas out there, some of which could be really important.

We’ve got more power than we think

Many of us feel helpless when encountering the healthcare system. It’s too big, too complicated, too impersonal, and too full of specialized knowledge for us to have the kind of agency we might like.

Mr. Mims advice, when it comes to tech is: “Collectively, we have agency over how new tech is developed, released, and used, and we’d be foolish not to use it.” The same is true with healthcare. We can be the patient patients our healthcare system has come to expect, or we can be the assertive ones that it will have to deal with.

I think about people like Dave deBronkart or the late Casey Quinlan when it comes to demanding our own data. I think about Andrea Downing and The Light Collective when it comes to privacy rights. I think about all the biohackers who are not waiting for the healthcare system to catch up on how to apply the latest tech to their health. And I think about all those patient advocates – too numerous to name – who are insisting on respect from the healthcare system and a meaningful role in managing their health.

Yes, we’ve got way more power than we think. Use it.

————

Mr. Mims is humble in admitting that he fell for some people, ideas, gadgets, and services that perhaps he shouldn’t. The key thing he does, though, to use his words, is “paying attention to what’s just over the horizon.” We should all be trying to do that and doing our best to prepare for it.

My horizon is what a 22nd healthcare system could, will and should look like. I’m not willing to settle for what our early 21st century one does. I expect I’ll continue to get a lot wrong but I’m still going to try.

Calum Yacoubian, Linguamatics

Calum Yacoubian is product director of Linguamatics, a company acquired in 2019 by IQVIA the huge data/clinical trials company itself a merger of IMS and Quintiles about a decade ago. Linguamatics is in the business of helping providers, payers and others with clinical background research based on NLP, and now with generative AI, is democratizing the ability to use NLP. Their case studies include for example trying to find patients with SDOH limitations, because they can aim LLMs at their data for summarization, and use them to help with data extraction from unstructured medical records. Calum thinks that LLMs are expanding the market for NLP!–Matthew Holt

A Call for Responsible Antibiotic Use in the Era of Telehealth

By PHIYEN NGUYEN

Telehealth has revolutionized health care as we know it, but it may also be contributing to the overuse of antibiotics and antimicrobial resistance.

Antibiotics and the Risks

Antibiotics treat infections caused by bacteria, like strep throat and whooping cough. They do this by either killing or slowing the growth of bacteria. Antibiotics save millions of lives around the world each year, but they can also be overprescribed and overused.

Excessive antibiotic use can lead to antimicrobial resistance (AMR). AMR happens when germs from the initial infection continue to survive, even after a patient completes a course of antibiotics. In other words, the germs are now resilient against that treatment. Resistance to even one type of antibiotic can lead to serious complications and prolonged recovery, requiring additional courses of stronger medicines.

The Centers for Disease Control and Prevention reported that AMR leads to over 2.8 million infections and 35,000 deaths each year in the United States. By 2050, AMR is predicted to cause about 10 million deaths annually, resulting in a global public health crisis.

Increase in Telehealth and Antibiotic Prescriptions

Surprisingly, the growth of telehealth care may be contributing to antibiotic overprescribing and overuse.

Telehealth exploded during the COVID-19 pandemic and, today, 87 percent of physicians use it regularly. Telehealth allows patients to receive health care virtually, through telephone, video, or other forms of technology. It offers increased flexibility, decreased travel time, and less risk of spreading disease for both patients and providers.

Popular platforms like GoodRx and Doctor on Demand market convenient and easy access to health care. Others offer specialized services, like WISP that focuses on women’s health. Despite its benefits, telehealth is not perfect.

It limits physical examinations (by definition) and rapport building, which changes the patient-provider relationship. It’s also unclear whether providers can truly make accurate diagnoses in a virtual setting in some cases.

Studies also show higher antibiotic prescribing rates in virtual consultations compared to in-person visits.

For instance, physicians were more likely to prescribe antibiotics for urinary tract infections during telehealth appointments (99%) compared to an office visit (49%). In another study, 55 percent of telehealth visits for respiratory tract infections resulted in antibiotic prescriptions, many of these cases were later found to not require them.

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Glen Tullman, CEO, Transcarent, talks about their new Wayfinding AI service

Glen Tullman came on THCB to talk about Transcarent’s new Wayfinding AI service. Transcarent has spent more than $125m (of the some $450m or so it’s raised so far) plugging an AI chatbot called Wayfinding into its various segments–which include the former 98.6 now rebranded as Transcarent Everyday Care. Wayfinding has benefits, clinical guidance and care delivery on one intelligent chatbot platform. No coincidence that this is released the same week as OpenAI released Chat GPT4o and the latest Google Gemini release. Make no mistake, this is a huge bet and probably the most aggressive, if obvious, use of an AI agent in health care I’ve seen so far. I saw a demo earlier which was pretty impressive and I had fun talking with Glen about what it’s capable of doing now, and what it will be–Matthew Holt

GPT-4o: What’s All The Fuss About?

By MIKE MAGEE

If you follow my weekly commentary on HealthCommentary.org or THCB, you may have noticed over the past 6 months that I appear to be obsessed with mAI, or Artificial Intelligence intrusion into the health sector space.

So today, let me share a secret. My deep dive has been part of a long preparation for a lecture (“AI Meets Medicine”) I will deliver this Friday, May 17, at 2:30 PM in Hartford, CT. If you are in the area, it is open to the public. You can register to attend HERE.

This image is one of 80 slides I will cover over the 90 minute presentation on a topic that is massive, revolutionary, transformational and complex. It is also a moving target, as illustrated in the final row above which I added this morning.

The addition was forced by Mira Murati, OpenAI’s chief technology officer, who announced from a perch in San Francisco yesterday that, “We are looking at the future of the interaction between ourselves and machines.”

The new application, designed for both computers and smart phones, is GPT-4o. Unlike prior members of the GPT family, which distinguished themselves by their self-learning generative capabilities and an insatiable thirst for data, this new application is not so much focused on the search space, but instead creates a “personal assistant” that is speedy and conversant in text, audio and image (“multimodal”).

OpenAI says this is “a step towards much more natural human-computer interaction,” and is capable of responding to your inquiry “with an average 320 millisecond (delay) which is similar to a human response time.” And they are fast to reinforce that this is just the beginning, stating on their website this morning “With GPT-4o, we trained a single new model end-to-end across text, vision, and audio, meaning that all inputs and outputs are processed by the same neural network. Because GPT-4o is our first model combining all of these modalities, we are still just scratching the surface of exploring what the model can do and its limitations.”

It is useful to remind that this whole AI movement, in Medicine and every other sector, is about language. And as experts in language remind us, “Language and speech in the academic world are complex fields that go beyond paleoanthropology and primatology,” requiring a working knowledge of “Phonetics, Anatomy, Acoustics and Human Development, Syntax, Lexicon, Gesture, Phonological Representations, Syllabic Organization, Speech Perception, and Neuromuscular Control.”

The notion of instantaneous, multimodal communication with machines has seemingly come of nowhere but is actually the product of nearly a century of imaginative, creative and disciplined discovery by information technologists and human speech experts, who have only recently fully converged with each other. As paleolithic archeologist, Paul Pettit, PhD, puts it, “There is now a great deal of support for the notion that symbolic creativity was part of our cognitive repertoire as we began dispersing from Africa.” That is to say, “Your multimodal computer imagery is part of a conversation begun a long time ago in ancient rock drawings.”

Throughout history, language has been a species accelerant, a secret power that has allowed us to dominate and rise quickly (for better or worse) to the position of “masters of the universe.”  The shorthand: We humans have moved “From babble to concordance to inclusivity…”

GPT-4o is just the latest advance, but is notable not because it emphasizes the capacity for “self-learning” which the New York Times correctly bannered as “Exciting and Scary,” but because it is focused on speed and efficiency in the effort to now compete on even playing field with human to human language. As OpenAI states, “GPT-4o is 2x faster, half the price, and has 5x higher (traffic) rate limits compared to GPT-4.”

Practicality and usability are the words I’d chose. In the companies words, “Today, GPT-4o is much better than any existing model at understanding and discussing the images you share. For example, you can now take a picture of a menu in a different language and talk to GPT-4o to translate it, learn about the food’s history and significance, and get recommendations.”

In my lecture, I will cover a great deal of ground, as I attempt to provide historic context, relevant nomenclature and definitions of new terms, and the great potential (both good and bad) for applications in health care. As many others have said, “It’s complicated!”

But as this yesterday’s announcing in San Francisco makes clear, the human-machine interface has blurred significantly. Or as Mira Murati put it, “You want to have the experience we’re having — where we can have this very natural dialogue.”

Mike Magee MD is a Medical Historian and regular contributor to THCB. He is the author of CODE BLUE: Inside the Medical Industrial Complex (Grove/2020)

Chakri Toleti, Care.ai

Chakri Toleti is an occasional Bollywood film producer (you can Google that) and also the CEO of Care.ai–one of the leading companies using sensors and AI to figure out what is going on in that hospital room. They’ve grown very fast in recent years, fundamentally by using technology to monitor patients and help improve their care, improve patient safety and figure out what else is needed to improve the care process. You’ll also see me doing a little bit of self-testing!–Matthew Holt

It’s the Bureaucrats, Stupid

By KIM BELLARD

Universities are having a hard time lately. They’re beset with protests the like of which we’ve not seen since the Vietnam War days, with animated crowds, sit-ins, violent clashes with police or counter protesters, even storming of administration buildings. Classes and commencements have been cancelled. Presidents of some leading universities seemed unable to clearly denounce antisemitism or calls for genocide when asked to do so in Congressional hearings. Protesters walked out on Jerry Seinfeld’s commencement speech; for heaven’s sake – who walks out on Jerry Seinfeld?

Derek Thompson wrote a great piece for The Atlantic that tries to pinpoint the source problem: No One Knows What Universities Are For. The sub-title sums up his thesis: “Bureaucratic bloat has siphoned power away from instructors and researchers.”  As I was nodding along with most of his points, I found myself also thinking: he might as well be talking about healthcare.

Mr. Thompson starts by citing a satirical piece in The Washington Post, in which Gary Smith, an economics professor at Pomona College, argues that, based on historical trends in the growth of administration staff, the college would be best served by gradually eliminating faculty and even students. The college’s endowment could then be used just to pay the administrators.

“And just like that,” Professor Smith says, “the college would be rid of two nuisances at once. Administrators could do what administrators do — hold meetings, codify rules, debate policy, give and attend workshops, and organize social events — without having to deal with whiny students and grumpy professors.”

It’s humorous, and yet it’s not.

The growth in universities’ administrative staff is widespread. Mr. Thompson acknowledges: “As the modern college has become more complex and multifarious, there are simply more jobs to do.” But that’s not always helping universities’ missions. Political scientist Benjamin Ginsberg, who published The Fall of the Faculty: The Rise of the All-Administrative University and Why It Matters in 2014, told Mr. Thompson: “I often ask myself, What do these people actually do? I think they spend much of their day living in an alternate universe called Meeting World.”

Similarly, Professor Smith told Mr., Thompson it’s all about empire building; as Mr. Thompson describes it: “Administrators are emotionally and financially rewarded if they can hire more people beneath them, and those administrators, in time, will want to increase their own status by hiring more people underneath them. Before long, a human pyramid of bureaucrats has formed to take on jobs of dubious utility.”

All of these administrators add to the well-known problem of runaway college tuition inflation, but a more pernicious problem Mr. Thompson points to is that “it siphons power away from instructors and researchers at institutions that are—theoretically—dedicated to instruction and research.”

The result, Mr. Thompson concludes is “goal ambiguity.” Gabriel Rossman, a sociologist at UCLA, told him: “The modern university now has so many different jobs to do that it can be hard to tell what its priorities are.”  Mr. Thompson worries: “Any institution that finds itself promoting a thousand priorities at once may find it difficult to promote any one of them effectively. In a crisis, goal ambiguity may look like fecklessness or hypocrisy.”

So it is with healthcare.

Anyone who follows healthcare has seen some version of the chart that shows the growth in the number of administrators versus the number of physicians over the last 50 years; the former has skyrocketed, the latter has plodded along. One can – and I have in other forums – quibble over who is being counted as “administrators” in these charts, but the undeniable fact is that there are a huge number of people working in healthcare whose job isn’t, you know, to help patients.

It’s well documented that the U.S. healthcare system is by far the world’s most expensive healthcare system, and that we have, again by far, the highest percent spent on administrative expenses. Just as all the college administrators helps keep driving up college tuition, so do all those healthcare administrators keep healthcare spending high.

But, as Mr. Thompson worries about with universities, the bigger problem in healthcare is goal ambiguity.

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Want to get rich in health care? Ditch the startup and run a hospital

By MATTHEW HOLT

Given that I ran a health technology conference for many years, I tend to run in a circle of people who have some ambition to get rich in health care. After all, billions of dollars of VC money have been dropped in lots of startups over the last decade, and a few prime examples have done very well. For example Jeff Tangey of Doximity, Glen Tullman of Livongo,  Chaim Indig of Phressia and many others did fine when their companies IPOed in the late 2010s. But the truth is that many, many more have either started a health tech business that didn’t make it, or were foot soldiers in others that died along the way (Olive, Babylon, Pear, etc, etc). Which has been leading me lately to thinking about whether that’s the right approach to take if you want to make money in health care. Hint: it’s not.

There’s still tremendously little transparency about which health care organizations have what amount of money and what people earn. There is though one sector that by law has to publish information about revenue, profits, investments and executive compensation. That is the non-profit hospital/health system sector. Nonprofits are required to file Form 990 with the IRS that has that information and more on it. Having said that, most hospitals are frequently late in filing them, and file them in a very confusing way. The wonderful journalism organization ProPublica maintains a database of all 990 filings and it’s instructive to look around in it.

Some health systems make it relatively easy. UPMC, the huge western PA conglomerate files one 990 for the whole group. Others, not so much. I know that Providence, the huge west coast system, has overall revenue of $28bn but only because Fierce Healthcare told me. Had I tried to piece that together from its 990s, I’d have started with its Washington filing ($6bn), moved on to its Oregon filing (~$5bn) and then started getting confused..

Let’s say you wanted to easily figure out Advocate, the system that was the merger of the huge midwestern system with Atrium, the North Carolina-based one. Good luck. You can find Advocate but Atrium’s seems to be missing. Ditto for Carolinas Health, its previous name. There is a page calling itself Financial Information on the Atrium website, but it doesn’t have any, and tells you to go to a website set up for municipal bondholders. In fact I couldn’t find any evidence of the IRS auditing any large system, or fining them for non-compliance in filing.

The good news is that last year the North Carolina State Employees plan, i.e. a pissed off purchaser, dug into all the N. Carolina hospital systems and found out that Atrium’s CEO pay went up nearly five-fold over six years. But even the state had real trouble finding out the truth:

“It is important to understand that these figures are significant underestimates for three reasons. First, a legal loophole denies the public the right to see how much publicly owned hospitals reported paying their top executives on their tax filings. This failure of oversight hides the tax filings of more than three in 10 nonprofit hospitals in North Carolina, including Atrium and UNC Health. UNC Health did not answer a public records request for executive compensation data until February 13, 2023, two days before this report’s publication and almost three months after its receipt of the request. UNC Health’s system wide data is therefore not included in this report.” 

So the very top dogs are doing well. At UPMC it turns out that seven made more than $3m including the CEO Jeff Romoff –the same one who forgot on 60 Minutes whether he made $6m or $7m. Turns out he didn’t have to remember that number for long as by 2021 he was making $12m.

But the munificence is spreading down the executive ladder. To demonstrate, let me introduce you to Tracey Beiriger Esq. There’s almost no information about Tracey on Linkedin or anywhere else on Google other than it appears he or she is an IP lawyer at UPMC. So why do I bring them up?

Because in 2021–the last year for which UPMC filed a 990 –Tracey was the 118th highest paid executive at UPMC and had the misfortune to only make $499,446.

Which means that 117 executives working at UPMC made more than $500,000. It’s a little tricky figuring out the similar numbers at Providence because of the multiple 990s in 2021 but there are 38 in Washington (not including CEO Rod Hochman who made $9m in 2020 and then vanished from the 2021 990!), 18 in Oregon and another 21 in Southern California. So call it 80+.

I bring this up because $500,000 is a pretty decent individual income. When I asked ChatGPT it estimated about 1.2 million Americans earned that much or more. Given the workforce is 167m, that puts those several hundred hospital execs way into the top 1%.

Now I have no objection to people earning good money. I’m sure they have all worked very hard for it. But if you look at these organizations, they do not seem to be spreading the wealth very far. 

Last year UPMC was accused by unions of suppressing staff wages. There is yet to be an outcome from that complaint to the DOJ, but last week there was one from a formal class action complaint about Providence shortchanging employees by rounding down their pay to the nearest half-hour, even though they were clocking on and off by the minute. Providence was fined $200m which probably isn’t much split between 33,000 employees but at least indicates that their senior management acts just like any other aggressive business in terms of cutting costs on the backs of their employees. And it’s not just their employees. They also just got fined $137m for aggressively suing patients.

Which leads me to two final points.

The first is, is it more likely you’ll make that $500K+ in a hospital system or in a tech startup? Blake Madden at Hospitology has been tracking systems that have more than $1bn in revenue. He’s found 113 so far. Second bottom of the list is Atlanticare in NJ, which has 16 execs making more than $500K.  Which by my wild guess means that the average system has about 50 employees making $500k+  which rounds up to something like 5,000 hospital execs making at least $500K and many of them are making a whole lot more. 

Compare that to a successful health tech startup that actually makes it. Take Phreesia, a VC-backed start-up that went public in 2019 having started way back in 2007. (I know the year because CEO Chaim Indig launched at Health 2.0 in 2008. He was nice enough to let me buy some stock at the IPO and I made a few bucks). Chaim made $300K the year it went public and as CEO of a public company that’s bounced around at being worth between $1Bn and $4Bn, he made $750K last year. No one else made more than $500K. Now yes, he owned 4% of the company at the IPO and got awarded more stock. He is doing very well, but the point is that there were dozens of companies launching at Health 2.0 in 2008 and the vast majority don’t get close to an IPO or making any money for the founders, let alone the staff. 

My conclusion is, it’s not a rational bet to go the health tech route if instead you can find a regional hospital chain and brown-nose your way up into the exec ranks!

The second point is more fundamental. Remember UPMC and its 117 execs making $500K+? What would a comparable government agency be paying out? I looked at the state of California salaries.There look to be about 50 state employees making more than $500k a year, almost all working for the state investment fund CALPERS. But the top paying one only makes $1.6m a year. I’m not saying that CALPERS should be paying out that much even if it is competing with Wall Street, after all members of the Senate only make $205,000 a year and the state could just put the whole pension into an S&P index fund. But what I am saying is that we should be thinking about paying our big non-profit systems similarly to government employees because they essentially are government employees.

Beckers posted UPMC’s payor mix last year. I highly suspect you’ll find something similar at almost every big system. 

  • Medicare 48%
  • Medicaid 17%
  • UPMC as Insurer 11%–(60% of whom are Medicaid/Medicare patients)
  • Commercial, Self Pay, Other 24%

More than 70% of the money comes from the government, and the rest from the suckers who have to buy their insurance on the “open market”–which includes those buying via the ACA exchange, receiving government subsidies, and government employees.

So while these huge systems act like Fortune 100 companies and reward their executives accordingly, almost all the money comes from the taxpayer.

I wish I could say we are getting good value for it.

And yes, I didn’t even mention the for-profits and the big insurers, but that will have to wait for another day….

Matthew Holt is the founder & publisher of THCB

You Bet Your Life

By KIM BELLARD

America is crazy about gambling. Once you had to gamble illegally with a bookie, or go to Atlantic City or Las Vegas; now 45 states – plus the District of Columbia, Puerto Rico, and the U.S. Virgin Islands – have state lotteries. Since the Supreme Court struck down PASPA, the federal ban on sports betting, 38 states – plus the D.C. and Puerto Rico – offer legal sports betting. I didn’t think we could get any crazier, until I saw last week that arcade chain Dave & Busters was going to allow betting on some of its games.

Honestly, healthcare may be the only industry upon which you can’t bet, and I’m beginning to think that’s too bad.

Dave & Busters are working with Lucra Sports, a “white-label gamification” technology company. “We’re thrilled to work with Lucra to bring this exciting new gaming platform to our customers,” said Simon Murray, SVP of Entertainment and Attractions at Dave and Buster’s. “This new partnership gives our loyalty members real-time, unrivaled gaming experiences, and reinforces our commitment to continuing to elevate our customer experience through innovative, cutting-edge technology.”

“Friendly competition really is a big fuel for our economy, whether you’re playing golf on Sunday with your buddies, or you’re going to play pickleball or video games or even cornhole at a tailgate. There’s so many ways that you can compete with friends and family, and I think gamifying that and digitizing all this offline stuff that’s happening is a massive opportunity,” Lucra CEO Dylan Robbins told CNN.

The companies are careful not to describe what they’re doing as gambling; they avoid terms like “bet” or “wager.” Michael Madding, Lucra’s chief operating officer, told The New York Times that the focus was on “skills-based” games, such as Skee-Ball or shooting baskets: i.e., “recreational activities for which the outcome is largely or entirely dependent on the knowledge, ability, strength, speed, endurance, intelligence of the participants and is subject to the control of those participants.”

This falls into a category I had never heard of: “social betting.” With social betting, there is no third party setting the odds, and more head-to-head competition with people you know. You’re not betting against the house; you’re challenging your friends. It is estimated by gaming research firm Eilers & Krejcik to be a $6b market, and its proponents argue that it is not subject to licenses & regulations that other gambling does.

Not everyone agrees. Marc Edelman, a law professor and the director of sports ethics at Baruch College in New York, told NYT:

If two people are competing against one another in Skee-Ball, presuming that there is nothing unusual done in the Skee-Ball game and physical skill is actually going to determine the winner, there is no problem. If I am taking a bet on whether someone else will win a Skee-Ball game, or whether someone else will achieve a particular score in Skee-Ball, if I myself am not engaged in a physical competition, that very likely would be seen as gambling.

Brett Abarbanel, executive director of the University of Nevada, Las Vegas, International Gaming Institute, went further, telling CNBC: “regardless of the legal classification of the activity as ‘not gambling’ vs. ‘gambling,’ this is an activity in which participants are risking something of value on an outcome that is uncertain. Therefore, there should be consumer protection measures in place for players, particularly when the target audience is skewed toward younger participants.”

Both Illinois and Ohio gambling authorities have already expressed concerns; Illinois State Rep. Daniel Didech, chairman of the Illinois House Gaming Committee,, told CNBC: “It is inappropriate for family-friendly arcades to facilitate unregulated gambling on their premises. These businesses simply do not have the ability to oversee gambling activity in a safe and responsible manner.”

There are also numerous “social sportsbooks,” including Flitt, PrizePicks, and Underdog Fantasy, that are blurring the line between online sports gambling and social betting, between fantasy leagues and plain old gambling. And they do it with users as young as 13 and with little or no state oversight. Keith Whyte, executive director of the National Council on Problem Gambling, told The Washington Post: “What a lot of these social gaming — social casinos, social sportsbooks — have found is that the regulators … either don’t feel like they have the jurisdiction or the time or energy to go after every single app that springs up.” 

Whether we like it or not, people are going to bet. “People will place a bet on ‘Will we have rainfall?’, or ‘How much snow will a certain place get?’, or ‘What will be the first day of snowfall?’” sports policy expert John Holden, JD/PhD, associate professor at Oklahoma State University, told Fox 5 NY last year.

So why shouldn’t they bet on health care?

Let’s face it: we all already bet on health care.

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