By: Paul Harkaway, MD & Kim Lynch

In our country's disjointed, cumbersome, and absurdly expensive healthcare "non-system," new and evolving dysfunctions continually surface, revealing its chaotic nature. If this system had been deliberately designed this way, the designer would likely be deemed a lunatic and a danger to others, warranting involuntary commitment. Yet, as there seems to be no one to blame—or perhaps too many to blame—the dangers persist, causing real harm to both those receiving care and those providing it.

Where Are We and What's at Stake?

Just over a year ago in March 2023, Silicon Valley Bank (SVB) collapsed, prompting swift industry and regulatory intervention to protect affected businesses and the banking industry. Similarly, in 2008, the auto industry bailout was crucial for both the workforce and the industry's survival. Yet, here we are, a month since the February 21, 2024 data breach and ransom play against United Health Care and its subsidiary, Change Healthcare.. This prolonged disruption, with providers not receiving payment while United is fast-tracking acquisitions, highlights the urgent need for change.

Why the different standards for healthcare? Why is it okay for doctors to be taking out lines of credit on their homes to make payroll when that was one of the main arguments for why we (rightly) stepped in with SVB?

The Impact on Healthcare Providers: A Struggle for Survival

The Change Healthcare breach not only potentially exposed protected health information (PHI) for 1 in 3 Americans—79 million of us—but continues to severely impact independent clinicians and their businesses. For them, the ability to receive payment disappeared after this event, further slimming their chances of survival due to narrow margins and delicate cash flows.

Slow cash flow isn’t new in the healthcare industry, but the extended shut down of Change, which processes 15 billion health care transactions annually (representing $1.5 trillion, up to 50% of all healthcare transactions), is a whole new level of disruption. At Metis, our software is designed to help clinics be more resilient because we know there are many challenges ahead. Our users can visualize, predict, and improve cash flow for their value-based care (VBC) contracts, periodic quality payments, and fee for service billing. Metis customers are better equipped for financial needs from the basics of making payroll to market disruptions like those brought about by Change.     

And if you think the elimination of private practice medicine is a good thing, akin to just one more extinction to add to the Anthropocene, we can assure you that it is not. Just like in ecology, there is a balance (already tilted) that you are unwise to disrupt if you want a healthy ecosystem. That balance is quite tenuous already and needs correction. Not a good idea to add more fuel to the current blaze.

A Question of Alignment and Ownership: Examining Health Insurance Companies' Expansive Role

Why are healthcare transactions not like ACH (Automated Clearing House) transactions in banking? The baseline transaction system works reliably and is 100% auditable. This enables innovation and healthy competition from companies building on top of this stable base—think of companies like Stripe and Plaid. Because the healthcare transaction system is anything but stable, reliable, auditable, and improving, there is plenty of room for incumbents to control all the payment they can and impose all the hurdles they can with little recourse. The money gained from such actions is then turned into additional assets, further locking them into ownership of the healthcare value chain. (See: United buying Change Healthcare in the first place). All of this leaves no incentive to do anything but keep everything the same.

Further, this breach has highlighted how far some health insurance companies have gone in consolidating various aspects of care provision under a single umbrella entity. While these subsidiaries may have different names, their integration is not always apparent. However, one lesson we apparently have to learn over and over in the health care world is that the primary and predictable outcome of consolidation is higher costs, as if our “system” is not costly enough already.

We want to understand: Who decided it was a good idea to allow health insurance companies to own and manage so many components of the healthcare ecosystem? Did the concept of insurance change while we were distracted? Should health insurance companies own:

• Pharmacy Benefit Managers?

• Physicians and Physician practices?

• Home health companies?

• Revenue cycle management companies managing billing and collecting for independent provider entities?

• Health data management companies?

• Hospital at Home companies?

• Ambulance companies?

• Surgery Centers?

• Hospitals?

• Etc.?

At what point does a conflict of interest become unacceptable in health insurance? Why is health insurance managed so differently from other types of insurance? For instance, if my home were damaged by fire, I would expect an independent contractor, not one employed by my insurer, to handle repairs. Similarly, in healthcare, shouldn't sensitive data and care provision be managed by separate, neutral parties with aligned incentives? These questions highlight concerns about the core competencies of health insurance companies and their subsidiaries.

Health insurance companies should ideally focus on population-based actuarial analysis, setting premiums with minimal administrative layers, and enabling efficient purchase and provision of care. This approach, common in other industries, emphasizes transparent incentive alignment among patients, providers, buyers, and insurers to prevent innovation from being stifled or the system from falling into imbalance.

The Call to Action: Advocating for Change & Dialing in Balance

While some may argue that consolidation has benefits, we remain highly skeptical and are in good company. Any claims of such benefits should be backed by tangible, validated evidence. Otherwise, they are merely aspirational or even distracting from the true issues at hand.

We are left to wonder, "Who thought this was a good idea?" So, what are we going to do about it?

To those yearning for change, balance, and are ready to do something about it, let’s talk. It’s what we are all about here at Metis

At Metis Health Technologies, we help organizations manage their healthcare business on a return-on-investment (ROI) basis – quantitatively and qualitatively, clinically, financially, and operationally. We meet clinical businesses where they are, supporting their priorities and definition of balance – be it to prioritize serving an underserved population, maximize quality scores, grow their footprint, or reach another goal. 

Within and across the Quintuple Aim, Metis helps clinics tune their business to suit their goals. We specialize in accelerating adoption of aligned care and payment models, delivering improved  outcomes, enabling greater access by helping clinicians survive and thrive.