1 00:00:02,240 --> 00:00:05,059 This is where health insurance leadership comes together. 2 00:00:05,279 --> 00:00:09,039 Becker's fourth annual spring payer issues roundtable brings 3 00:00:09,039 --> 00:00:12,259 together over 400 payer and health plan executives 4 00:00:12,400 --> 00:00:16,574 and more than 100 speakers to Chicago April. 5 00:00:16,875 --> 00:00:19,755 This year's event includes keynote conversations with the 6 00:00:19,755 --> 00:00:23,035 industry's top leaders and former president George W. 7 00:00:23,035 --> 00:00:25,675 Bush. For the full agenda and event details, 8 00:00:25,675 --> 00:00:27,870 visit beckershospitalreview.com 9 00:00:27,949 --> 00:00:29,230 and click on the events tab in the 10 00:00:29,230 --> 00:00:31,470 upper right. We're looking forward to hosting you 11 00:00:31,470 --> 00:00:32,609 here in Chicago. 12 00:00:33,950 --> 00:00:36,109 Hello, everyone. This is Jacob Emerson with the 13 00:00:36,109 --> 00:00:38,049 Becker's Payer Issues podcast. 14 00:00:38,510 --> 00:00:40,670 Thrilled today to be joined by a special 15 00:00:40,670 --> 00:00:43,755 guest. Paul Markovich serves as the president and 16 00:00:43,995 --> 00:00:46,875 CEO of Ascendiant. Ascendiant is the parent company 17 00:00:46,875 --> 00:00:49,675 of Blue Shield of California, the clinical services 18 00:00:49,675 --> 00:00:53,054 firm Altais, and the health services business Stellaris. 19 00:00:53,594 --> 00:00:55,675 Paul, thank you very much for taking the 20 00:00:55,675 --> 00:00:57,195 time to be with me on the podcast 21 00:00:57,195 --> 00:00:57,695 today. 22 00:00:58,100 --> 00:01:00,200 It's my pleasure, Jacob. Thanks for having me. 23 00:01:00,500 --> 00:01:02,740 Likewise. And, Paul, before we dive into everything 24 00:01:02,740 --> 00:01:04,420 we wanna talk with you about, can you 25 00:01:04,420 --> 00:01:06,260 tell us a little bit more about your 26 00:01:06,260 --> 00:01:08,579 career over these last couple of decades at 27 00:01:08,579 --> 00:01:10,599 Ascendiant and at Blue Shield of California? 28 00:01:11,385 --> 00:01:13,064 And for our audience who might not be 29 00:01:13,064 --> 00:01:15,864 familiar, what is Ascendiant? And, ultimately, what are 30 00:01:15,864 --> 00:01:18,265 you trying to accomplish with this new parent 31 00:01:18,265 --> 00:01:18,765 company? 32 00:01:19,465 --> 00:01:21,144 Well, let's maybe start with that, and then 33 00:01:21,144 --> 00:01:22,665 I'll work my way backwards. It's, 34 00:01:23,465 --> 00:01:24,765 just over a year ago, 35 00:01:25,379 --> 00:01:27,479 we decided to take Blue Shield of California 36 00:01:28,579 --> 00:01:28,900 and, 37 00:01:29,540 --> 00:01:31,859 create a new corporate structure for it, which 38 00:01:31,859 --> 00:01:34,359 was to have a nonprofit parent called Ascendiant. 39 00:01:35,060 --> 00:01:37,140 And that allowed us to actually create the 40 00:01:37,140 --> 00:01:38,739 two other companies that you mentioned in the 41 00:01:38,739 --> 00:01:39,239 introduction, 42 00:01:40,055 --> 00:01:43,174 both Stellaris and Altais, which are are not 43 00:01:43,174 --> 00:01:45,734 health plan companies, and I think are more, 44 00:01:45,974 --> 00:01:47,734 likely to be able to attract capital and 45 00:01:47,734 --> 00:01:49,194 achieve a level of scale, 46 00:01:50,295 --> 00:01:52,295 in this new structure than they would have 47 00:01:52,295 --> 00:01:54,454 under the traditional one with Blue Shield of 48 00:01:54,454 --> 00:01:55,674 California. So 49 00:01:56,269 --> 00:01:58,670 we're hoping this structure will help help us 50 00:01:58,670 --> 00:02:00,510 accelerate our attempts to create a health care 51 00:02:00,510 --> 00:02:02,189 system as we describe it that's worthy of 52 00:02:02,189 --> 00:02:04,369 our family and friends and sustainably affordable. 53 00:02:04,909 --> 00:02:06,269 And I'd say in terms of my career, 54 00:02:06,269 --> 00:02:08,750 that's what's really driven all of my decisions. 55 00:02:08,750 --> 00:02:11,245 I got started in in New York, working 56 00:02:11,245 --> 00:02:13,085 for Booz Allen and Hamilton. I started out 57 00:02:13,085 --> 00:02:15,824 in financial services, but then got recruited over 58 00:02:16,125 --> 00:02:18,284 to the healthcare side and and really felt 59 00:02:18,284 --> 00:02:18,784 like, 60 00:02:19,805 --> 00:02:22,205 the possibility of taking a system that was 61 00:02:22,205 --> 00:02:25,745 clearly not functioning at its apex for everybody 62 00:02:32,009 --> 00:02:34,349 great cause. And so I just started to 63 00:02:34,569 --> 00:02:36,489 focus my energy on that. And so when 64 00:02:36,489 --> 00:02:38,030 I moved out to the Bay Area, 65 00:02:38,705 --> 00:02:40,705 the first job I found in 1995 was 66 00:02:40,705 --> 00:02:42,564 with Blue Shield of California. And 67 00:02:42,864 --> 00:02:43,264 and, 68 00:02:43,745 --> 00:02:45,185 I did have about a two and a 69 00:02:45,185 --> 00:02:46,784 two and a half year, what I call 70 00:02:46,784 --> 00:02:47,284 entrepreneurial 71 00:02:47,664 --> 00:02:48,164 sabbatical, 72 00:02:49,025 --> 00:02:51,300 in the early two thousands, but came back, 73 00:02:51,540 --> 00:02:53,219 to Blue Shield in 2002 74 00:02:53,219 --> 00:02:54,759 and and just haven't looked back. 75 00:02:55,540 --> 00:02:57,460 Wonderful. It must be a great place to 76 00:02:57,460 --> 00:02:59,139 work to keep you there for that long. 77 00:02:59,139 --> 00:03:02,259 So appreciate, that overview of of, what you've 78 00:03:02,259 --> 00:03:04,199 been up to over that amount of time. 79 00:03:04,944 --> 00:03:06,944 Paul, I wanted to get started today by 80 00:03:06,944 --> 00:03:07,764 talking about, 81 00:03:08,305 --> 00:03:11,424 what certainly was one of the bigger stories 82 00:03:11,424 --> 00:03:13,264 to start the year within the health care 83 00:03:13,264 --> 00:03:13,764 industry, 84 00:03:14,384 --> 00:03:15,284 when you were, 85 00:03:15,745 --> 00:03:16,724 one of five 86 00:03:17,069 --> 00:03:18,849 total health insurance CEOs, 87 00:03:19,389 --> 00:03:20,370 who testified 88 00:03:20,990 --> 00:03:21,810 before congress, 89 00:03:22,750 --> 00:03:23,250 over 90 00:03:23,710 --> 00:03:26,430 the broad topic of rising health care costs, 91 00:03:26,430 --> 00:03:28,129 rising health insurance costs. 92 00:03:28,430 --> 00:03:30,004 Obviously, as you know, there's a lot that 93 00:03:30,004 --> 00:03:32,665 was touched on during those hearings, nine hours 94 00:03:32,724 --> 00:03:34,485 or more so, more than nine hours in 95 00:03:34,485 --> 00:03:34,724 total. 96 00:03:36,245 --> 00:03:38,104 I we heard about industry consolidation. 97 00:03:38,405 --> 00:03:39,705 We heard about prior authorization, 98 00:03:40,324 --> 00:03:41,385 executive pay. 99 00:03:42,300 --> 00:03:44,459 I I guess, first, Paul, how was that? 100 00:03:44,459 --> 00:03:46,379 I mean, what was it like to be 101 00:03:46,379 --> 00:03:48,699 summoned to Washington and have to testify in 102 00:03:48,699 --> 00:03:51,039 in front of lawmakers for so long about, 103 00:03:51,340 --> 00:03:53,439 a myriad of of complicated topics? 104 00:03:54,564 --> 00:03:57,924 Well, prior to the this all happening, I 105 00:03:57,924 --> 00:03:59,685 had one colleague tell me he thought I 106 00:03:59,685 --> 00:04:01,525 was the only one who was actually looking 107 00:04:01,525 --> 00:04:02,984 forward to being there. And 108 00:04:03,364 --> 00:04:05,204 I can't speak for anyone else, but that 109 00:04:05,204 --> 00:04:06,824 was certainly true for me. And 110 00:04:07,150 --> 00:04:08,930 and, Jacob, the reason is that 111 00:04:09,230 --> 00:04:11,790 we're passionate about trying to transform the health 112 00:04:11,790 --> 00:04:13,169 care system. We think it's 113 00:04:13,870 --> 00:04:16,830 dysfunctional and broken and bankrupting us, and we 114 00:04:16,830 --> 00:04:19,310 we need structural systemic change. And frankly, we 115 00:04:19,310 --> 00:04:20,830 need help from the government. That's one of 116 00:04:20,830 --> 00:04:23,305 the things I said in my testimony was 117 00:04:23,305 --> 00:04:23,705 that, 118 00:04:24,665 --> 00:04:26,524 I didn't see the health care system 119 00:04:27,145 --> 00:04:29,384 willing to fix itself, and so it needed 120 00:04:29,384 --> 00:04:31,865 some it needs some tough love and direction. 121 00:04:31,865 --> 00:04:33,625 And I think the federal government is in 122 00:04:33,625 --> 00:04:35,725 the best position to provide that. So, 123 00:04:36,769 --> 00:04:38,610 I I saw it as an opportunity. Certainly, 124 00:04:38,610 --> 00:04:40,370 there were tough questions, but there should be. 125 00:04:40,370 --> 00:04:42,930 We're we should all be accountable to the 126 00:04:42,930 --> 00:04:45,410 American people for the the product we deliver, 127 00:04:45,410 --> 00:04:47,430 and it costs too much right now. So 128 00:04:47,490 --> 00:04:49,634 I think those questions should come with the 129 00:04:49,634 --> 00:04:51,095 territory and I felt comfortable 130 00:04:51,395 --> 00:04:52,995 responding to them as best I could on 131 00:04:52,995 --> 00:04:54,995 behalf of our organization. But I think the 132 00:04:54,995 --> 00:04:55,495 opportunity 133 00:04:56,514 --> 00:04:57,654 was to talk about 134 00:04:58,035 --> 00:05:00,115 not just what's wrong with the system, but 135 00:05:00,115 --> 00:05:02,115 what needs to change, the bold reforms that 136 00:05:02,115 --> 00:05:04,650 need to happen. And I I really appreciated 137 00:05:04,650 --> 00:05:06,730 the opportunity to do that, and my sense 138 00:05:06,730 --> 00:05:08,509 was that those messages resonated. 139 00:05:09,610 --> 00:05:12,569 Absolutely. And that really was what came across 140 00:05:12,569 --> 00:05:14,670 at least on our end watching these hearings, 141 00:05:15,050 --> 00:05:17,230 and and watching you testify was, 142 00:05:18,170 --> 00:05:21,045 the candidness of your message, I think, compared 143 00:05:21,045 --> 00:05:22,904 to some of the others because 144 00:05:23,444 --> 00:05:25,845 you you flat out called the the health 145 00:05:25,845 --> 00:05:27,225 care industry broken. 146 00:05:27,525 --> 00:05:29,305 You called for collective accountability, 147 00:05:30,085 --> 00:05:32,105 among some of these companies that, of course, 148 00:05:32,165 --> 00:05:34,860 oversee the management of a lot of tax 149 00:05:34,939 --> 00:05:35,680 payer dollars. 150 00:05:36,219 --> 00:05:37,979 So can you can you expand on that 151 00:05:37,979 --> 00:05:39,819 for our audience in terms of what were 152 00:05:39,819 --> 00:05:41,759 you trying to communicate to lawmakers, 153 00:05:42,219 --> 00:05:43,439 to the broader public? 154 00:05:43,899 --> 00:05:44,399 And 155 00:05:44,939 --> 00:05:47,360 have any conversations been sparked since either, 156 00:05:48,219 --> 00:05:50,875 at your company alone or with colleagues across 157 00:05:50,875 --> 00:05:51,455 the industry? 158 00:05:52,395 --> 00:05:54,555 Well, I just believe fundamentally that you can't 159 00:05:54,555 --> 00:05:57,355 fix a problem unless you see it and 160 00:05:57,355 --> 00:05:58,735 identify it clearly. 161 00:05:59,274 --> 00:05:59,774 And 162 00:06:00,314 --> 00:06:02,795 and and glossing over it doesn't help. Avoiding 163 00:06:02,795 --> 00:06:05,160 it doesn't help. If you just look at 164 00:06:05,160 --> 00:06:07,079 the fact that our system costs too much, 165 00:06:07,079 --> 00:06:09,079 the costs are growing at a rate faster 166 00:06:09,079 --> 00:06:10,699 than everything else. 167 00:06:11,000 --> 00:06:13,560 Our quality scores lag other countries. We're not 168 00:06:13,560 --> 00:06:16,439 covering everybody, and most Americans don't have confidence 169 00:06:16,439 --> 00:06:17,879 in the system. I don't see how you 170 00:06:17,879 --> 00:06:18,234 can look at that and say there isn't 171 00:06:18,234 --> 00:06:18,279 a fundamental problem. And also that it's systemic 172 00:06:18,279 --> 00:06:19,029 in nature. 173 00:06:19,495 --> 00:06:20,394 A fundamental problem. 174 00:06:21,095 --> 00:06:23,514 And also that it's systemic in nature, 175 00:06:24,214 --> 00:06:25,115 that there's just 176 00:06:25,495 --> 00:06:28,055 the way that the system works, how we 177 00:06:28,055 --> 00:06:30,375 pay all the players to do more rather 178 00:06:30,375 --> 00:06:32,074 than to to get better outcomes, 179 00:06:32,689 --> 00:06:34,289 The fact that we're not digital, we keep 180 00:06:34,289 --> 00:06:35,430 using fax machines. 181 00:06:35,889 --> 00:06:38,209 The fact that everybody who distributes drugs gets 182 00:06:38,209 --> 00:06:40,209 paid more when we and when they sell 183 00:06:40,209 --> 00:06:42,529 and administer a higher volume of more expensive 184 00:06:42,529 --> 00:06:45,589 drugs, those are systemic issues that require 185 00:06:46,375 --> 00:06:48,634 systemic fixes. And so I think 186 00:06:49,014 --> 00:06:50,535 if if you're really gonna try to get 187 00:06:50,535 --> 00:06:52,855 to the change, you gotta be straightforward, clear, 188 00:06:52,855 --> 00:06:55,014 and candid about what the problems are, take 189 00:06:55,014 --> 00:06:55,514 accountability 190 00:06:56,134 --> 00:06:56,634 for 191 00:06:57,014 --> 00:06:58,714 your what we own, 192 00:06:59,250 --> 00:07:00,150 and then to, 193 00:07:00,569 --> 00:07:03,810 to offer the opportunity or offer to cooperate 194 00:07:03,810 --> 00:07:06,210 and collaborate to to fix it. So I 195 00:07:06,210 --> 00:07:08,949 called for eliminating kickbacks in the pharmacy distribution 196 00:07:09,009 --> 00:07:10,770 system and then finally putting the health care 197 00:07:10,770 --> 00:07:13,044 system on a budget. And so, again, I 198 00:07:13,044 --> 00:07:15,685 think those messages were clear and resonated as 199 00:07:15,685 --> 00:07:18,884 potential constructive solutions. And, frankly, I was incredibly 200 00:07:18,884 --> 00:07:21,224 happy to see that shortly after that, congress 201 00:07:21,284 --> 00:07:22,824 actually passed a law 202 00:07:23,845 --> 00:07:24,824 that changed, 203 00:07:25,899 --> 00:07:28,860 how pharmacy benefit managers can price. And that 204 00:07:28,860 --> 00:07:29,100 was, 205 00:07:30,060 --> 00:07:32,459 directly related to one of the things I 206 00:07:32,459 --> 00:07:33,920 was advocating for. 207 00:07:34,779 --> 00:07:36,939 Yeah. I'm absolutely. I mean, to to what 208 00:07:36,939 --> 00:07:39,345 you just said, we've we're already seeing major 209 00:07:39,345 --> 00:07:41,504 updates in the PBM space and and some 210 00:07:41,504 --> 00:07:42,084 of these, 211 00:07:42,545 --> 00:07:44,944 this latest settlement deal with Express Scripts and 212 00:07:44,944 --> 00:07:45,605 the FTC. 213 00:07:46,865 --> 00:07:48,785 But I I do wanna ask you just 214 00:07:48,785 --> 00:07:51,105 because you've been in this industry for for 215 00:07:51,105 --> 00:07:54,449 so long, you are a very, respectable name. 216 00:07:54,449 --> 00:07:55,829 Leaders across this industry, 217 00:07:56,610 --> 00:07:58,930 recognize you and and know what you've done 218 00:07:58,930 --> 00:08:00,389 over these over these decades. 219 00:08:01,329 --> 00:08:02,870 And and and I think given 220 00:08:03,490 --> 00:08:05,254 just the the sheer amount of news that 221 00:08:05,254 --> 00:08:07,095 has happened in this last year from from 222 00:08:07,095 --> 00:08:08,394 HR one last summer 223 00:08:08,774 --> 00:08:11,194 to the expiration of the enhanced subsidies, 224 00:08:11,814 --> 00:08:13,115 at the start of this year, 225 00:08:14,854 --> 00:08:16,774 what led up to these hearings? How should 226 00:08:16,774 --> 00:08:17,675 we be framing 227 00:08:18,134 --> 00:08:18,794 the pressure 228 00:08:19,180 --> 00:08:22,699 and and why lawmakers wanted an individual like 229 00:08:22,699 --> 00:08:24,539 yourself to come to Washington to talk about 230 00:08:24,539 --> 00:08:26,699 this kind of thing? How should the leaders 231 00:08:26,699 --> 00:08:29,259 listening into this recording today, how should we 232 00:08:29,259 --> 00:08:31,740 be framing this current moment in health care 233 00:08:31,740 --> 00:08:32,720 from your perspective? 234 00:08:33,419 --> 00:08:33,919 Well, 235 00:08:34,704 --> 00:08:36,725 we have a fundamental problem 236 00:08:37,105 --> 00:08:39,924 right now in that the average American cannot 237 00:08:40,144 --> 00:08:42,384 afford the average health care premium without a 238 00:08:42,384 --> 00:08:42,884 subsidy. 239 00:08:43,504 --> 00:08:46,325 That subsidy comes from government or employers generally, 240 00:08:46,384 --> 00:08:48,084 and neither of them can continue 241 00:08:48,529 --> 00:08:49,110 to subsidize 242 00:08:49,649 --> 00:08:50,470 at the level, 243 00:08:51,570 --> 00:08:53,330 at that they do today, let alone where 244 00:08:53,330 --> 00:08:56,309 it's moving in the future. And so 245 00:08:57,009 --> 00:08:58,690 one of the things I tell industry leaders 246 00:08:58,690 --> 00:09:01,090 all the time is you cannot have a 247 00:09:01,090 --> 00:09:02,309 sustainable business 248 00:09:03,014 --> 00:09:04,955 in an industry that is not sustainable. 249 00:09:06,295 --> 00:09:08,955 And this industry is just not sustainable. 250 00:09:09,575 --> 00:09:11,735 And I think what we're seeing with h 251 00:09:11,735 --> 00:09:14,855 r one and Medicaid with without extending the 252 00:09:14,855 --> 00:09:16,875 tax credits, with the the recent 253 00:09:17,549 --> 00:09:18,830 call, or the recent, 254 00:09:19,629 --> 00:09:22,350 announcement on on Medicare Advantage and the the 255 00:09:22,350 --> 00:09:23,889 pricing that's gonna be available, 256 00:09:24,830 --> 00:09:27,090 the reimbursement that's gonna be available on Medicare. 257 00:09:27,549 --> 00:09:29,470 I mean, the government's starting to say we 258 00:09:29,470 --> 00:09:30,690 cannot afford this, 259 00:09:31,115 --> 00:09:32,554 and we're gonna have to figure out a 260 00:09:32,554 --> 00:09:34,714 way to to make ourselves afford it, which 261 00:09:34,714 --> 00:09:36,475 means that we as an industry have to 262 00:09:36,475 --> 00:09:38,735 stop showing up and asking for more money. 263 00:09:38,954 --> 00:09:40,975 We need to figure out that we have 264 00:09:41,194 --> 00:09:43,450 a we have a cost problem, not a 265 00:09:43,450 --> 00:09:45,690 revenue problem, and figure out how to tackle 266 00:09:45,690 --> 00:09:47,529 it. So, you know, my message for the 267 00:09:47,529 --> 00:09:48,429 industry is 268 00:09:49,209 --> 00:09:50,429 this is our new normal. 269 00:09:50,809 --> 00:09:52,889 We have to, as many other industries have, 270 00:09:52,889 --> 00:09:54,350 figure out how to make 271 00:09:55,209 --> 00:09:56,110 make an impact 272 00:09:56,490 --> 00:09:57,389 and do better 273 00:09:58,315 --> 00:09:58,815 with 274 00:09:59,274 --> 00:10:01,995 fewer resources and just figure out how to 275 00:10:01,995 --> 00:10:03,914 be more productive. And that has not been 276 00:10:03,914 --> 00:10:05,834 the mindset of the industry for most of 277 00:10:05,834 --> 00:10:06,414 my career. 278 00:10:07,115 --> 00:10:09,274 No. Certainly. And I I think it it 279 00:10:09,274 --> 00:10:11,054 really goes to a point you were making 280 00:10:11,115 --> 00:10:12,574 in your your testimony, 281 00:10:13,500 --> 00:10:15,360 talking about sustainability overall, 282 00:10:16,059 --> 00:10:17,600 really for for Blue Shield. 283 00:10:18,139 --> 00:10:19,759 And you were talking about capping 284 00:10:20,220 --> 00:10:22,059 how the company caps its income at at 285 00:10:22,059 --> 00:10:23,200 2% of revenue. 286 00:10:23,580 --> 00:10:25,740 Your your five year net margin is just 287 00:10:25,740 --> 00:10:27,200 point 23%. 288 00:10:27,625 --> 00:10:29,225 And, you know, that really goes against, I 289 00:10:29,225 --> 00:10:31,644 think, what is a very pervasive narrative about 290 00:10:31,705 --> 00:10:34,264 a lot of health insurers, especially those that 291 00:10:34,264 --> 00:10:36,985 operate, on the nonprofit side, those within the 292 00:10:36,985 --> 00:10:37,965 Blues ecosystem. 293 00:10:38,904 --> 00:10:39,404 So 294 00:10:39,809 --> 00:10:42,950 overall, Paul, how are you thinking about balancing 295 00:10:43,009 --> 00:10:44,870 financial sustainability at Ascendiant 296 00:10:45,730 --> 00:10:48,529 with with your overall mission of trying to 297 00:10:48,529 --> 00:10:49,669 keep coverage affordable, 298 00:10:50,049 --> 00:10:52,289 trying to tamp down on some of these 299 00:10:52,289 --> 00:10:53,190 rising costs? 300 00:10:53,914 --> 00:10:55,914 Well, we we certainly have to figure out 301 00:10:55,914 --> 00:10:57,914 how to bring in more revenue than our 302 00:10:57,914 --> 00:10:58,414 costs, 303 00:10:58,954 --> 00:11:00,794 in order to be able to provide a 304 00:11:00,794 --> 00:11:03,995 product. And so that's fundamental. And we for 305 00:11:03,995 --> 00:11:07,019 our purposes, we've figured that 2% margin is 306 00:11:07,019 --> 00:11:09,100 the right number, and we have been falling 307 00:11:09,100 --> 00:11:11,039 short of that over the last several years. 308 00:11:11,419 --> 00:11:13,740 So that's certainly fundamental and important, but we 309 00:11:13,740 --> 00:11:15,279 have to do that in a way 310 00:11:15,740 --> 00:11:18,139 where the ultimate price that we're charging is 311 00:11:18,139 --> 00:11:18,639 affordable 312 00:11:19,100 --> 00:11:21,105 to the end customer, which which means we 313 00:11:21,105 --> 00:11:22,965 have to get the cost, cost everywhere, 314 00:11:23,585 --> 00:11:25,445 our own administrative costs, 315 00:11:26,144 --> 00:11:28,144 which have been coming down, but also the 316 00:11:28,144 --> 00:11:31,125 cost that we incur on the system. And 317 00:11:31,424 --> 00:11:33,585 that's where I think health plans have the 318 00:11:33,585 --> 00:11:34,565 biggest responsibility 319 00:11:34,945 --> 00:11:35,684 and haven't 320 00:11:36,069 --> 00:11:37,370 delivered on that responsibility 321 00:11:37,909 --> 00:11:39,269 the way that they should have, and that 322 00:11:39,269 --> 00:11:39,769 is 323 00:11:40,230 --> 00:11:41,909 the the way we set up the rules 324 00:11:41,909 --> 00:11:44,009 of the system for things like prior authorization 325 00:11:45,110 --> 00:11:46,809 put a lot of burden and administrative 326 00:11:47,429 --> 00:11:48,490 tasks and frustration 327 00:11:49,429 --> 00:11:49,929 on 328 00:11:50,794 --> 00:11:53,514 clinicians and health care providers and on the 329 00:11:53,514 --> 00:11:55,134 and on the patient in the end. 330 00:11:55,434 --> 00:11:57,674 I mean, it really is mind boggling to 331 00:11:57,674 --> 00:12:01,615 me that the the most common communication mechanism 332 00:12:01,754 --> 00:12:02,654 still today 333 00:12:03,019 --> 00:12:05,259 for doing things like getting information for prior 334 00:12:05,259 --> 00:12:07,120 authorization is a fax machine. 335 00:12:07,899 --> 00:12:09,659 And, you know, the idea that that would 336 00:12:09,659 --> 00:12:10,159 be 337 00:12:10,700 --> 00:12:13,759 a customer and physician friendly mechanism 338 00:12:14,539 --> 00:12:16,934 to be communicating back and forth and and 339 00:12:17,014 --> 00:12:19,575 and making decisions that have huge impact on 340 00:12:19,575 --> 00:12:20,394 people's lives. 341 00:12:21,014 --> 00:12:23,495 I mean, really, shame on us as health 342 00:12:23,495 --> 00:12:25,434 plans for not having figured out 343 00:12:25,815 --> 00:12:28,294 yet how to solve for that. The good 344 00:12:28,294 --> 00:12:30,850 news is we are now stepping forward and 345 00:12:30,850 --> 00:12:32,610 solving for it. But I think there's a 346 00:12:32,610 --> 00:12:34,870 whole series of things like that Jacob where, 347 00:12:36,049 --> 00:12:38,129 we need to as health plans, but not 348 00:12:38,129 --> 00:12:40,230 just as health plans as an entire industry, 349 00:12:41,250 --> 00:12:43,029 figure out how to 350 00:12:43,625 --> 00:12:46,264 make ourselves more productive. Like, we've had over 351 00:12:46,264 --> 00:12:49,384 the last five decades, maybe a 150 to 352 00:12:49,384 --> 00:12:51,784 200% increase in the number of physicians and 353 00:12:51,784 --> 00:12:53,065 a more than 3000% 354 00:12:53,065 --> 00:12:54,605 increase in the number of, 355 00:12:55,144 --> 00:12:58,220 administrative jobs in health care. And so there's 356 00:12:58,220 --> 00:13:00,720 a there's an opportunity here and an absolute 357 00:13:00,860 --> 00:13:02,159 need for us 358 00:13:02,620 --> 00:13:04,379 to drive those costs out of the system, 359 00:13:04,379 --> 00:13:06,139 not just for the health plan, but through 360 00:13:06,139 --> 00:13:08,460 the entire health care system. And since the 361 00:13:08,460 --> 00:13:09,759 the health plans like ours 362 00:13:10,455 --> 00:13:12,315 control the rules of the system, 363 00:13:12,855 --> 00:13:15,035 we have the best chance to try and 364 00:13:15,175 --> 00:13:16,795 change things in a way 365 00:13:17,254 --> 00:13:20,295 that allows us all to be financially viable, 366 00:13:20,295 --> 00:13:22,055 but in a way that's affordable to the 367 00:13:22,055 --> 00:13:22,555 customer. 368 00:13:23,970 --> 00:13:25,889 It's so funny. You really do hate the 369 00:13:25,889 --> 00:13:28,450 fax machine, because I remember you you you 370 00:13:28,450 --> 00:13:30,129 talked with us about this a few years 371 00:13:30,129 --> 00:13:30,629 ago. 372 00:13:31,330 --> 00:13:32,690 But I also think that points to the 373 00:13:32,690 --> 00:13:34,690 fact that this is this is a topic 374 00:13:34,690 --> 00:13:37,504 that just continues to stick around or or 375 00:13:37,504 --> 00:13:39,504 a concept that continues to stick around that 376 00:13:39,504 --> 00:13:41,045 so much of the health care system 377 00:13:41,504 --> 00:13:44,404 is using a technology that I believe started 378 00:13:44,705 --> 00:13:46,465 in the eighteen hundreds, the the core of 379 00:13:46,465 --> 00:13:46,965 it. 380 00:13:47,899 --> 00:13:50,000 And it's something we hear about from executives 381 00:13:50,139 --> 00:13:52,960 constantly. They everyone hates the fax machine. So 382 00:13:53,100 --> 00:13:56,080 I guess, Paul, educate me, educate our audience. 383 00:13:56,379 --> 00:13:58,559 Are we getting close to a time where 384 00:13:58,700 --> 00:14:01,424 that actually goes away? I mean, what's what's 385 00:14:01,424 --> 00:14:03,445 the barrier here to getting rid of, 386 00:14:03,825 --> 00:14:06,865 this this antiquated tech? Well, first first thing 387 00:14:06,865 --> 00:14:08,304 you should know, if you really wanna see 388 00:14:08,304 --> 00:14:10,225 how much I hate a, a fax machine, 389 00:14:10,225 --> 00:14:12,884 there's actually a YouTube video of me smashing 390 00:14:12,945 --> 00:14:15,089 one to smithereens, and the interesting story there 391 00:14:15,330 --> 00:14:17,009 I'll have to watch that. Yeah. Well, the 392 00:14:17,009 --> 00:14:18,769 interesting story there story there is that we 393 00:14:18,769 --> 00:14:20,529 actually went to use one of the fax 394 00:14:20,529 --> 00:14:22,289 machines that we had in the office, but 395 00:14:22,289 --> 00:14:24,129 the team wouldn't let me because they were 396 00:14:24,129 --> 00:14:26,129 using it. So we actually had to buy 397 00:14:26,129 --> 00:14:27,110 a fax machine, 398 00:14:28,294 --> 00:14:30,375 to to bash it up. But, you know, 399 00:14:30,375 --> 00:14:31,975 the fact is what we need to do 400 00:14:32,134 --> 00:14:34,294 what the fundamental driver here is we need 401 00:14:34,294 --> 00:14:35,115 every American 402 00:14:36,054 --> 00:14:36,714 to have 403 00:14:37,014 --> 00:14:39,975 access to a real time comprehensive digital health 404 00:14:39,975 --> 00:14:40,475 record 405 00:14:40,950 --> 00:14:42,710 that they can access and use, that their 406 00:14:42,710 --> 00:14:45,029 treating clinicians can access and use, and that 407 00:14:45,029 --> 00:14:47,850 health plans can for administrative purposes such 408 00:14:48,230 --> 00:14:51,429 as putting together quality scores and and submitting 409 00:14:51,429 --> 00:14:53,509 risk adjustment. As soon as you do that, 410 00:14:53,509 --> 00:14:55,110 then you bring health care into the digital 411 00:14:55,110 --> 00:14:55,610 world. 412 00:14:55,975 --> 00:14:58,634 And and and you can be exchanging information 413 00:14:59,174 --> 00:15:00,774 in real time, and you don't have to 414 00:15:00,774 --> 00:15:01,995 have these antiquated 415 00:15:02,695 --> 00:15:03,195 mechanisms 416 00:15:04,934 --> 00:15:07,174 to to send information back and forth that's 417 00:15:07,174 --> 00:15:08,794 just highly unreliable 418 00:15:09,174 --> 00:15:11,514 and slow and inefficient and 419 00:15:11,870 --> 00:15:13,629 just puts a whole bunch of friction into 420 00:15:13,629 --> 00:15:15,490 the system. So there's just no reason, 421 00:15:16,350 --> 00:15:18,190 frankly, for these things not to be fully 422 00:15:18,190 --> 00:15:20,669 automated and in real time. The technology has 423 00:15:20,669 --> 00:15:22,269 been there not just for years, but for 424 00:15:22,269 --> 00:15:24,529 decades. But the foundation of it is 425 00:15:24,875 --> 00:15:26,714 we have to be able to know all 426 00:15:26,714 --> 00:15:28,334 the digital information that's 427 00:15:28,875 --> 00:15:31,454 related to that particular patient in those circumstances 428 00:15:32,315 --> 00:15:35,674 so that all of the information that needs 429 00:15:35,674 --> 00:15:36,495 to be used 430 00:15:36,954 --> 00:15:37,454 to 431 00:15:37,899 --> 00:15:39,919 prior authorize, settle a claim, 432 00:15:40,299 --> 00:15:43,100 do risk scores, do quality scores, and figure 433 00:15:43,100 --> 00:15:43,839 out payments, 434 00:15:44,539 --> 00:15:45,740 all of that could be done in a 435 00:15:45,740 --> 00:15:47,919 real time and automated basis. But foundationally, 436 00:15:48,620 --> 00:15:50,220 the technology is there. But if you don't 437 00:15:50,220 --> 00:15:52,959 have the information available in a usable format 438 00:15:53,024 --> 00:15:54,165 in a timely way, 439 00:15:54,625 --> 00:15:57,045 then you end up having to find alternatives 440 00:15:57,105 --> 00:15:59,105 for sending that information back and forth, which 441 00:15:59,105 --> 00:16:01,665 is where we are today. Absolutely. And I 442 00:16:01,665 --> 00:16:02,404 know there's, 443 00:16:03,024 --> 00:16:03,845 prior authorization 444 00:16:04,465 --> 00:16:07,600 policies that are underway starting this year, going 445 00:16:07,600 --> 00:16:11,059 into next year that, look to hopefully alleviate 446 00:16:11,120 --> 00:16:12,720 some of that. So I I suppose we'll 447 00:16:12,720 --> 00:16:14,639 see how this shakes out in the in 448 00:16:14,639 --> 00:16:17,054 the next few years. But but speaking of 449 00:16:17,375 --> 00:16:17,875 antiquated 450 00:16:18,254 --> 00:16:22,335 models overall, Paul, I thought something that really 451 00:16:22,335 --> 00:16:24,014 has stood out to me over these last 452 00:16:24,014 --> 00:16:26,514 few years in terms of hard news announcements 453 00:16:27,054 --> 00:16:29,475 was when Blue Shield of California 454 00:16:29,855 --> 00:16:30,995 announced your unbundled 455 00:16:31,455 --> 00:16:34,129 PBM model. And I know that went into 456 00:16:34,690 --> 00:16:36,529 that started to roll out last year, so 457 00:16:36,529 --> 00:16:38,389 we're just over a year now into that. 458 00:16:38,690 --> 00:16:41,269 And you launched this with with Amazon Pharmacy, 459 00:16:41,490 --> 00:16:42,629 with Prime Therapeutics, 460 00:16:43,809 --> 00:16:45,110 some other big players, 461 00:16:45,804 --> 00:16:48,205 and really trying to replace that traditional single 462 00:16:48,205 --> 00:16:51,165 PBM approach and and take more control of 463 00:16:51,165 --> 00:16:52,625 your your drug spending. 464 00:16:53,644 --> 00:16:55,325 So so like I said, now that that's 465 00:16:55,325 --> 00:16:57,165 been up and running for over a year 466 00:16:57,165 --> 00:16:59,579 now, can you update us on on how 467 00:16:59,579 --> 00:17:01,759 that's going? What's been working? 468 00:17:02,539 --> 00:17:04,799 Anything harder than than expected? 469 00:17:05,659 --> 00:17:07,980 Well, I'd say the there's sort of three 470 00:17:07,980 --> 00:17:09,900 three parts to this, and one has gone 471 00:17:09,900 --> 00:17:11,339 really well, and the other two have been 472 00:17:11,339 --> 00:17:13,494 more of a struggle. The first part was 473 00:17:13,494 --> 00:17:14,875 just being able to 474 00:17:15,174 --> 00:17:17,115 put together all these different players 475 00:17:17,974 --> 00:17:19,894 and and be able to administer the benefit. 476 00:17:19,894 --> 00:17:22,855 I mean, we literally had a 143, 477 00:17:22,855 --> 00:17:25,015 I think, data integration points that we had 478 00:17:25,015 --> 00:17:25,755 to put together 479 00:17:26,369 --> 00:17:26,869 to 480 00:17:27,250 --> 00:17:30,849 piece together the ability to administer this program. 481 00:17:30,849 --> 00:17:31,349 And 482 00:17:31,650 --> 00:17:32,950 we managed to do that, 483 00:17:33,410 --> 00:17:35,730 and and our members are getting their prescriptions 484 00:17:35,730 --> 00:17:37,670 and getting really good service, and, 485 00:17:38,369 --> 00:17:40,765 and we've saved some money from that and 486 00:17:40,765 --> 00:17:42,525 the about the money that we expected to 487 00:17:42,525 --> 00:17:43,664 in that first phase. 488 00:17:44,125 --> 00:17:45,644 The other two things we needed to do 489 00:17:45,644 --> 00:17:46,384 was first 490 00:17:46,765 --> 00:17:47,985 we're first to 491 00:17:48,765 --> 00:17:51,644 contract directly with pharmacy manufacturers and try to 492 00:17:51,644 --> 00:17:54,049 get into a net price scenario rather than 493 00:17:54,049 --> 00:17:56,369 all these rebates and fees and and back 494 00:17:56,369 --> 00:17:57,109 and forth. 495 00:17:57,410 --> 00:17:58,769 The good news there is the deals that 496 00:17:58,769 --> 00:18:01,090 we have done have demonstrated there's, I think, 497 00:18:01,090 --> 00:18:03,170 savings to be had and and a lot 498 00:18:03,170 --> 00:18:05,730 simple a a lot simpler and clearer model 499 00:18:05,730 --> 00:18:07,109 to the to the patient. 500 00:18:07,755 --> 00:18:09,434 But we only have about 10 of them, 501 00:18:09,434 --> 00:18:10,654 and we need thousands. 502 00:18:11,115 --> 00:18:13,275 And so that has been slow going. And 503 00:18:13,275 --> 00:18:14,734 then the other is to 504 00:18:15,595 --> 00:18:16,974 really phase out and eliminate 505 00:18:17,914 --> 00:18:20,315 the spread pricing that happens, not just with 506 00:18:20,315 --> 00:18:23,295 pharmacy benefit managers, but with others like physicians 507 00:18:23,970 --> 00:18:24,710 and hospitals. 508 00:18:25,650 --> 00:18:28,130 And that has also been slow going. It's 509 00:18:28,130 --> 00:18:30,390 been one negotiation at a time. So 510 00:18:30,929 --> 00:18:31,329 we, 511 00:18:31,730 --> 00:18:33,809 what we'd like to see accelerated, and we 512 00:18:33,809 --> 00:18:35,970 are looking for ways to do this, or 513 00:18:35,970 --> 00:18:37,954 how do we how do we get 514 00:18:38,815 --> 00:18:41,454 to truly eliminating spread price pricing across the 515 00:18:41,454 --> 00:18:41,954 board 516 00:18:42,335 --> 00:18:44,595 and getting to direct net price, 517 00:18:45,615 --> 00:18:47,474 for paying for for drugs, 518 00:18:47,934 --> 00:18:49,615 so that we don't have all of these 519 00:18:49,615 --> 00:18:50,835 rebates and fees, 520 00:18:51,539 --> 00:18:54,580 sloshing through the system and potentially costing patients 521 00:18:54,580 --> 00:18:56,340 more than they need for their for their 522 00:18:56,340 --> 00:18:56,840 drugs. 523 00:18:58,019 --> 00:19:00,580 Understood. Understood. And I like I said, any 524 00:19:00,580 --> 00:19:02,660 any updates that you can consistently share with 525 00:19:02,660 --> 00:19:03,880 us there, Paul, 526 00:19:04,180 --> 00:19:06,039 we'd love to hear them because I know 527 00:19:06,214 --> 00:19:08,134 our audience of health care executives has been 528 00:19:08,134 --> 00:19:10,535 very interested in in how your company has, 529 00:19:10,775 --> 00:19:11,595 really pioneered 530 00:19:12,055 --> 00:19:14,075 this unbundling PBM, 531 00:19:14,934 --> 00:19:15,515 a model. 532 00:19:16,454 --> 00:19:18,535 But I also wanted to ask you about 533 00:19:18,535 --> 00:19:20,695 some other recent news from the company late 534 00:19:20,695 --> 00:19:21,914 last year as well. 535 00:19:23,150 --> 00:19:23,809 You had 536 00:19:24,109 --> 00:19:26,509 the Blue Cross affiliates in Hawaii and then 537 00:19:26,509 --> 00:19:29,730 in Kansas join Blue Shield California as cofounders 538 00:19:29,789 --> 00:19:30,450 of Stellaris. 539 00:19:31,150 --> 00:19:33,390 Can you give us an update on where 540 00:19:33,390 --> 00:19:35,650 that all stands, and and what's the vision 541 00:19:35,914 --> 00:19:38,315 for this this company overall? Do you hope 542 00:19:38,315 --> 00:19:39,134 to have more 543 00:19:39,515 --> 00:19:41,694 Blue Cross plans join you in this? 544 00:19:42,794 --> 00:19:44,554 Yes. Well, the the new structure that we 545 00:19:44,554 --> 00:19:47,134 created with Ascendiant as a nonprofit parent, 546 00:19:47,914 --> 00:19:50,315 and then creating Stellaris where we we moved 547 00:19:50,315 --> 00:19:50,894 the technology 548 00:19:51,940 --> 00:19:52,680 and other strategic capabilities 549 00:19:53,619 --> 00:19:54,519 into Stellaris 550 00:19:55,460 --> 00:19:56,200 so that 551 00:19:56,660 --> 00:19:59,480 they could be available and sold to other 552 00:19:59,859 --> 00:20:00,680 blue plans. 553 00:20:01,299 --> 00:20:04,019 And the idea there was by having plans 554 00:20:04,019 --> 00:20:06,359 like Hawaii and Kansas that 555 00:20:06,835 --> 00:20:09,394 that joined as both investors and customers in 556 00:20:09,394 --> 00:20:10,855 September 557 00:20:11,715 --> 00:20:12,434 is that, 558 00:20:12,835 --> 00:20:13,494 we can 559 00:20:14,195 --> 00:20:16,055 jointly invest in these things, 560 00:20:16,914 --> 00:20:19,095 and all get access to 561 00:20:19,769 --> 00:20:21,230 more cutting edge and modern 562 00:20:21,609 --> 00:20:22,109 capabilities 563 00:20:22,809 --> 00:20:24,349 that help us serve our missions, 564 00:20:24,809 --> 00:20:26,029 but at a lower cost 565 00:20:26,330 --> 00:20:27,470 and not requiring 566 00:20:27,930 --> 00:20:30,670 us to merge and change any of our 567 00:20:30,970 --> 00:20:31,470 governance, 568 00:20:32,484 --> 00:20:33,144 and independence 569 00:20:33,524 --> 00:20:36,265 that each of the plans has. And so 570 00:20:36,404 --> 00:20:37,765 that was, I think, the appeal of the 571 00:20:37,765 --> 00:20:39,765 model to those two plans. I believe it's 572 00:20:39,765 --> 00:20:42,265 a model that will appeal to other plans 573 00:20:42,404 --> 00:20:43,065 as well. 574 00:20:43,924 --> 00:20:45,849 And what it's going to allow us to 575 00:20:45,849 --> 00:20:47,690 do is is to for example, once we 576 00:20:47,690 --> 00:20:50,089 do have a digital health record, is to 577 00:20:50,089 --> 00:20:52,329 to use the technology so that we don't 578 00:20:52,329 --> 00:20:54,589 have to use fax machines, and we can 579 00:20:54,730 --> 00:20:56,490 fully automate things and get a lot of 580 00:20:56,490 --> 00:20:58,250 cost out of the system and move to 581 00:20:58,250 --> 00:20:59,849 new payment models and effectively, 582 00:21:01,105 --> 00:21:02,865 have a health plan that is capable of 583 00:21:02,865 --> 00:21:04,784 doing the things that I said need to 584 00:21:04,784 --> 00:21:06,404 happen across the industry 585 00:21:06,944 --> 00:21:10,244 nationally in my, testimony to congress. So 586 00:21:10,704 --> 00:21:12,085 that's that's what 587 00:21:12,464 --> 00:21:12,964 Stellaris 588 00:21:13,345 --> 00:21:14,804 is doing, and that's why 589 00:21:15,589 --> 00:21:17,589 both Hawaii and Kansas joined. And that's why 590 00:21:17,589 --> 00:21:19,509 I certainly hope that there will be others 591 00:21:19,509 --> 00:21:20,490 that do the same. 592 00:21:20,789 --> 00:21:23,210 Certainly. So you're trying to preserve the independence 593 00:21:23,430 --> 00:21:25,049 of of these blues companies, 594 00:21:25,750 --> 00:21:28,250 their their own corporate structures, but 595 00:21:28,630 --> 00:21:29,849 lend them resources, 596 00:21:30,150 --> 00:21:31,365 help them scale, 597 00:21:31,825 --> 00:21:33,204 with these new technologies, 598 00:21:33,984 --> 00:21:34,484 to 599 00:21:35,024 --> 00:21:37,105 remain competitive, I imagine, among some of the 600 00:21:37,105 --> 00:21:39,984 more, the national for profit rivals. Is that 601 00:21:39,984 --> 00:21:41,125 correct? Precisely. 602 00:21:41,505 --> 00:21:44,164 These, a lot of these capabilities are not 603 00:21:44,659 --> 00:21:47,960 inexpensive to develop. And so the ability to 604 00:21:48,179 --> 00:21:49,480 to get highly competitive, 605 00:21:51,059 --> 00:21:51,880 scale sensitive 606 00:21:52,339 --> 00:21:52,839 capabilities 607 00:21:53,220 --> 00:21:54,740 to your members and be able to do 608 00:21:54,740 --> 00:21:57,000 that in a trusted environment with another nonprofit 609 00:21:57,059 --> 00:21:59,079 blue plan is is what we're offering. 610 00:21:59,674 --> 00:22:01,775 Sure. Sure. It makes a lot of sense. 611 00:22:02,794 --> 00:22:05,454 I you mentioned the digital health record, 612 00:22:05,835 --> 00:22:07,835 the universal health record, which is something that 613 00:22:07,835 --> 00:22:09,035 you laid out as a as a top 614 00:22:09,035 --> 00:22:11,430 priority in your in your testimony last month. 615 00:22:11,990 --> 00:22:14,470 You also mentioned moving away from fee for 616 00:22:14,470 --> 00:22:14,970 service, 617 00:22:15,430 --> 00:22:15,930 eliminating 618 00:22:16,230 --> 00:22:18,090 PBM rebates and spread pricing, 619 00:22:18,470 --> 00:22:20,309 and then putting the health care system on 620 00:22:20,309 --> 00:22:22,809 a budget to create more affordability, 621 00:22:23,269 --> 00:22:25,454 more predictability, and then, of course, like what 622 00:22:25,454 --> 00:22:28,335 we discussed earlier, more sustainability for the entire 623 00:22:28,335 --> 00:22:28,835 system. 624 00:22:29,375 --> 00:22:31,794 Obviously, some of those are are massive goals. 625 00:22:32,414 --> 00:22:32,914 Paul, 626 00:22:33,694 --> 00:22:36,815 because we saw one of these, directly addressed 627 00:22:36,815 --> 00:22:39,054 just in these last these last week, do 628 00:22:39,054 --> 00:22:41,720 you have any thoughts on this this landmark 629 00:22:41,779 --> 00:22:44,180 PBM bill that has now passed congress and 630 00:22:44,180 --> 00:22:44,839 and, ultimately, 631 00:22:45,220 --> 00:22:46,500 what it will mean and how it will 632 00:22:46,500 --> 00:22:48,580 trickle down the effects of it for for 633 00:22:48,580 --> 00:22:50,039 your members and for patients 634 00:22:50,420 --> 00:22:50,920 everywhere? 635 00:22:51,619 --> 00:22:53,835 Well, I I I'm really encouraged by the 636 00:22:53,835 --> 00:22:55,934 bill and also by the settlement 637 00:22:56,394 --> 00:22:59,434 between the Federal Trade Commission and Cigna Express 638 00:22:59,434 --> 00:22:59,934 Scripts, 639 00:23:00,394 --> 00:23:02,255 which had some of the some similar, 640 00:23:02,875 --> 00:23:04,654 changes that are required 641 00:23:05,230 --> 00:23:07,389 in terms of pricing and the distribution of 642 00:23:07,389 --> 00:23:10,829 pharmaceutical drugs. I think what you're seeing, frankly, 643 00:23:10,829 --> 00:23:12,849 is the death knell of a business model 644 00:23:13,470 --> 00:23:13,970 where 645 00:23:14,589 --> 00:23:17,569 the pharmacy benefit managers and their affiliates 646 00:23:18,714 --> 00:23:20,634 tie their compensation to the price of a 647 00:23:20,634 --> 00:23:21,134 drug. 648 00:23:21,434 --> 00:23:22,875 I think what you're going to see is 649 00:23:22,875 --> 00:23:25,754 that whole system is is effectively going away 650 00:23:25,754 --> 00:23:27,454 now or is going to go away, 651 00:23:27,994 --> 00:23:28,494 and 652 00:23:28,875 --> 00:23:30,634 everyone's gonna have to figure out how to 653 00:23:30,634 --> 00:23:33,259 get reimbursed in a very different way. And 654 00:23:33,259 --> 00:23:33,759 so 655 00:23:34,059 --> 00:23:36,139 that, I think, is highly encouraging and is 656 00:23:36,139 --> 00:23:36,639 what 657 00:23:37,019 --> 00:23:38,700 prompted us to move to the new model 658 00:23:38,700 --> 00:23:41,099 and to advocate for these changes is that 659 00:23:41,099 --> 00:23:42,639 it's there's no way 660 00:23:42,940 --> 00:23:44,940 to get to a health care system that's 661 00:23:44,940 --> 00:23:46,960 worthy of our family and friends and sustainably 662 00:23:47,259 --> 00:23:47,759 affordable 663 00:23:48,684 --> 00:23:49,184 if, 664 00:23:49,884 --> 00:23:52,605 if a whole series of companies see selling 665 00:23:52,605 --> 00:23:55,724 and administering drugs as a profit center and 666 00:23:55,724 --> 00:23:57,744 effectively are collecting kickbacks to 667 00:23:59,164 --> 00:24:01,404 sell and administer those drugs. I mean, that's 668 00:24:01,404 --> 00:24:03,529 just it's not what's best for the patient, 669 00:24:03,529 --> 00:24:04,730 and there's no way you get to an 670 00:24:04,730 --> 00:24:06,970 affordable system. So I'm very encouraged by the 671 00:24:06,970 --> 00:24:07,470 law. 672 00:24:07,769 --> 00:24:09,769 There's been some other changes going on, 673 00:24:10,170 --> 00:24:11,690 as well, and I think all of it 674 00:24:11,690 --> 00:24:13,549 just adds up to 675 00:24:14,170 --> 00:24:15,869 we're gonna have to move to a different 676 00:24:16,089 --> 00:24:16,589 system. 677 00:24:17,625 --> 00:24:19,224 Well, Paul, before we run out of time 678 00:24:19,224 --> 00:24:20,585 here, I know we've touched on a lot 679 00:24:20,585 --> 00:24:21,884 today, a lot of big topics. 680 00:24:22,184 --> 00:24:24,424 Anything else we're missing? Anything else you wanna 681 00:24:24,424 --> 00:24:25,404 share with our audience 682 00:24:25,705 --> 00:24:26,585 or any other, 683 00:24:26,984 --> 00:24:29,085 bits of advice you wanna offer, 684 00:24:29,625 --> 00:24:32,190 all the other health plan leaders listening in 685 00:24:32,190 --> 00:24:33,490 from across the industry? 686 00:24:34,509 --> 00:24:36,430 Well, I I we didn't talk much about 687 00:24:36,430 --> 00:24:38,029 the idea of putting the system on a 688 00:24:38,029 --> 00:24:40,210 budget, and I think it's worth saying that 689 00:24:40,750 --> 00:24:42,750 I've always believed that necessity is the mother 690 00:24:42,750 --> 00:24:45,890 of invention. And so the idea of saying, 691 00:24:46,394 --> 00:24:49,035 yes. There's a way to improve the health 692 00:24:49,035 --> 00:24:49,695 of Americans 693 00:24:50,474 --> 00:24:51,455 and do it 694 00:24:51,835 --> 00:24:53,835 with health care cost trends that are at 695 00:24:53,835 --> 00:24:55,615 or below price and wage inflation. 696 00:24:56,154 --> 00:24:58,734 I'm absolutely convinced that is 697 00:24:59,035 --> 00:24:59,535 possible. 698 00:25:00,409 --> 00:25:02,250 We're not on a trajectory to do that 699 00:25:02,250 --> 00:25:04,250 right now, and right now the mindset is 700 00:25:04,250 --> 00:25:06,409 what needs to shift. I think the mindset 701 00:25:06,409 --> 00:25:08,649 of most leaders in health care is to 702 00:25:08,649 --> 00:25:10,190 just explain to everybody 703 00:25:10,649 --> 00:25:12,990 why health care costs more than everything else 704 00:25:13,095 --> 00:25:14,855 and why it trends at a higher late 705 00:25:15,654 --> 00:25:17,355 at a higher rate than everything else. 706 00:25:17,815 --> 00:25:19,755 And we as an industry have 707 00:25:20,214 --> 00:25:20,794 to realize 708 00:25:21,414 --> 00:25:21,914 explanations 709 00:25:23,015 --> 00:25:23,515 aren't 710 00:25:23,894 --> 00:25:27,115 gonna cut it, not for the American people, 711 00:25:27,174 --> 00:25:28,075 not for Congress. 712 00:25:28,859 --> 00:25:29,359 And, 713 00:25:30,299 --> 00:25:31,920 and we have to get into a mindset, 714 00:25:32,140 --> 00:25:33,119 a different mindset. 715 00:25:33,420 --> 00:25:35,180 How do we make health care affordable? We 716 00:25:35,180 --> 00:25:37,019 all have to be financially viable, but how 717 00:25:37,019 --> 00:25:38,400 do we make health care affordable 718 00:25:38,940 --> 00:25:40,700 and worthy of our family and friends? And 719 00:25:40,700 --> 00:25:42,779 that means we have a cost problem that 720 00:25:42,779 --> 00:25:43,759 we need to address. 721 00:25:44,275 --> 00:25:46,914 And I'm hopeful that creating that kind of 722 00:25:46,914 --> 00:25:48,855 budgetary top down pressure 723 00:25:49,234 --> 00:25:50,454 is something that helps 724 00:25:50,994 --> 00:25:51,974 create that mindset 725 00:25:52,434 --> 00:25:54,535 and gets us into a much more innovative 726 00:25:54,595 --> 00:25:55,894 phase in health care 727 00:25:56,400 --> 00:25:56,900 and, 728 00:25:57,599 --> 00:26:00,259 one where we we really are focused on 729 00:26:00,480 --> 00:26:02,240 how to make things better for the patient 730 00:26:02,240 --> 00:26:03,220 and more efficiently. 731 00:26:04,640 --> 00:26:06,320 Well, it it's very clear to us here 732 00:26:06,320 --> 00:26:08,500 at Becker's that Ascendiant and and Blue Shield 733 00:26:08,640 --> 00:26:10,880 are at the forefront of of putting forth 734 00:26:10,880 --> 00:26:11,380 things 735 00:26:11,724 --> 00:26:15,164 into fruition that, that will tackle some of 736 00:26:15,164 --> 00:26:17,484 those goals. So, Paul, I wanna thank you 737 00:26:17,484 --> 00:26:19,085 for for taking the time to chat with 738 00:26:19,085 --> 00:26:19,585 us, 739 00:26:20,204 --> 00:26:22,444 and and for sharing your insights about all 740 00:26:22,444 --> 00:26:25,164 these topics with our audience. We really appreciate 741 00:26:25,164 --> 00:26:27,429 it. You're most welcome, Jacob. Thanks for the 742 00:26:27,429 --> 00:26:29,750 time. And to our audience, if you'd like 743 00:26:29,750 --> 00:26:31,990 to listen to more podcasts from Becker's Healthcare, 744 00:26:31,990 --> 00:26:34,890 you can visit beckershospitalreview.com.