When a company wants to change clinician behavior or close a care gap and comes in asking for an "EHR strategy" — or, more often, an "Epic strategy" — as step one, that's a red flag. In this healthcare podcast, Ashleigh Gunter, president of Translucent Healthcare Consulting and a 30-year veteran of management consulting, joins Stacey Richter to explain why an Epic strategy is necessary but nowhere near sufficient for actually changing behavior inside a hospital or physician organization — and what real change management requires instead. WHAT YOU'LL LEARN ✅ Why an "EHR strategy" (or "Epic strategy") is not the same as a change management strategy — it's necessary but not sufficient to actually change clinician behavior ✅ Ashleigh Gunter's five steps to effective change management: great leadership, creating a case for change, finding champions, overcommunicating, and measuring and celebrating progress ✅ Why "communication of change, in and of itself, isn't change management" — and what has to happen before communication can actually work ✅ Why frontline care delivery experience is too often left out of change management efforts, and what that costs an initiative ✅ How identifying and mobilizing "change champions" — people who have to change and can help others do the same — makes or breaks adoption inside a health system or health plan WHY THIS MATTERS The best tech tools, care models, and forward-thinking concepts don't matter if no one can be convinced to adopt them — and in a complicated, multilayered system like healthcare, it only takes one ounce of resistance to sabotage an entire effort. An EHR or Epic strategy can make the mechanics of change easier once people are already bought in, but it supplies no "why," and no case for change slithers spontaneously out of anyone's API. Real change management starts with leadership and a case for change grounded in what the people being asked to change actually care about — not with the software they'll eventually use. === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 09:22 How does change management go wrong in healthcare? 09:56 "Communication [of change] in and of itself isn't change management." 10:53 How does change management work on the provider organization side? 15:33 "You want to ensure you are educating the operational folks." 16:35 What is change management? 17:36 What does great leadership look like in change management? 18:55 "Leadership sets the tone." 19:04 What makes change management so hard? 19:31 "What's the company reason to make this change happen?" 20:51 What are change champions, and why do you need to create them when changing your benefit plan? 21:57 Crossing the Chasm by Geoffrey A. Moore. 23:21 Why is it important to overcommunicate change? 26:47 Why is it important to measure your successes and communicate those after a change?

Spencer Dorn, MD, MPH, MHA — a gastroenterologist, academic practice leader, and clinical informaticist at UNC — joins Stacey Richter to talk about EHRs (electronic health records) without really talking about EHRs. The real subject is Kranzberg's First Law of Technology: technology is never good, bad, or neutral on its own. Whether an EHR ends up empowering clinicians or burying them in information, extending human connection or eroding it, depends almost entirely on how it's implemented — the workflows, training, staffing, and people around it — not on the software itself. WHAT YOU'LL LEARN ✅ Why Dr. Dorn insists there's no intrinsic property of technology, including EHRs, that determines whether it helps or hurts — outcomes depend entirely on implementation, per Kranzberg's First Law of Technology ✅ Why the same EHR system deployed in two different places can produce wildly different results depending on workflow, training, staffing, and change management, not the software itself ✅ How EHR-embedded information can just as easily empower clinicians as overwhelm them, and why that outcome sits on a continuum rather than being a binary ✅ Why "optimizing the EHR" is often the wrong framing, and why reframing conversations around optimizing the patient-doctor encounter or clinician teamwork gets closer to the real goal ✅ How EHR deployments can either extend or diminish human connection between doctors and patients, and between clinicians working together WHY THIS MATTERS It's tempting to praise or blame a piece of healthcare technology as if the software itself carries some inherent verdict — good, bad, or neutral. Kranzberg's First Law of Technology says otherwise: technology is never neutral, but it's also never predetermined. The same EHR system can empower one care team and overwhelm another, and the difference almost always comes down to workflow design, training, staffing, and the people implementing it, not the code. For anyone evaluating or purchasing healthcare technology, the real question isn't whether the tool is good — it's whether the surrounding people and processes are set up to make it good. === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 06:15 Breaking down Kranzberg's Laws of Technology. 08:16 How do EHRs go right? 12:49 "EHRs empower us with information, yet they also overwhelm us with information." 16:00 How do EHRs bring healthcare workers closer together? 19:35 The Digital Doctor by Robert Wachter. 21:33 "The whole point of healthcare is to help people live healthier, happier lives." 22:41 How the same EHR deployed in different places can be more or less efficient. 25:51 Why the problem is not necessarily the EHR but actually operational. 28:51 How technology has also changed our expectations on timing and value.

Tom X. Lee, MD — who founded One Medical and Epocrates and now leads Galileo — joins Stacey Richter to answer a question so many primary care leaders are asking: can a primary-care-only practice actually survive in 2024? Dr. Lee names what he calls the "paradox of primary care" — the fact that the most common way to make primary care financially sustainable is to drive downstream specialty volume, which is exactly the outcome good primary care is supposed to prevent — and lays out what it actually takes to escape that trap: enlightened leadership with a value mindset, paired with real service-operations chops. WHAT YOU'LL LEARN ✅ What Dr. Lee calls the "paradox of primary care" — how the most common path to primary care profitability (driving downstream specialty volume) directly undermines what good primary care is supposed to achieve ✅ Why Dr. Lee believes enlightened leadership combined with strong service operations, not just funding, is what actually separates a pure-play primary care practice that survives from one that doesn't ✅ Where hidden waste actually lives in a primary care practice — often busywork, redundant clicks, and tasks that could be automated or handled by a nurse navigator instead of a physician ✅ Why open access to care isn't enough on its own, and why "access, sure, but access to what?" explains why retail clinics struggled to become longitudinal primary care destinations ✅ Dr. Lee's message to payers and policymakers about what it would actually take to help primary care find its "productive middle" between fee-for-service and value WHY THIS MATTERS Primary care's central bind is structural: the organizations that own primary care practices usually make more money the more specialty and downstream care gets used, which means truly effective primary care can end up cannibalizing its own parent organization's revenue. Escaping that bind, according to Dr. Lee, isn't about picking a side between fee-for-service and value-based care — it's about building the leadership and operational discipline to find a productive middle, whether a practice is independent, direct primary care, or embedded inside a larger system. Getting the incentives wrong at the payer and policy level, meanwhile, keeps making that middle harder to reach. MENTIONED IN THIS EPISODE EP438 with John Lee, MD: Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 07:02 What is the paradox of primary care? 09:19 Why is it hard to run an independent primary care practice? 10:01 What are the barriers to running an independent primary care practice? 10:41 Can you have fee for service and value? 12:25 "Value is more about a mindset." 13:22 What hidden waste is there in a primary care practice? 15:11 What do you need to have a value-focused mindset? 17:14 Why does access precede quality? 18:20 Why have retail clinics failed in being longitudinal primary care destinations? 20:29 What is a longitudinal primary care destination and why does it matter? 23:48 What are the nuances of a service business that make them challenging for managers? 24:35 How do you find the balance between fee for service and value? 31:17 EP438 with John Lee, MD. 32:14 How can you invest in quality without a value-based contract? 34:19 How do you address the trade-off between fee-for-service finances and investing in value-based care? 35:36 Where is the "productive middle"? 36:27 Dr. Tom Lee's message to payers. 39:55 Dr. Tom Lee's message for policymakers.

This encore revisits one of the most popular episodes of 2023. Paul Holmes, an ERISA attorney who has spent nearly 40 years specializing in PBM (pharmacy benefit manager) contracts, joins Stacey Richter to explain why signing a PBM's standard model contract without independent review typically costs a self-insured plan sponsor 30% to 40% above market on drug spend — and why that gap has become a legal liability, not just a financial one, since the passage of the Consolidated Appropriations Act (CAA). WHAT YOU'LL LEARN ✅ Why signing a PBM's standard model contract without independent review typically costs a plan sponsor 30% to 40% above market on drug spend ✅ Why employee benefit consultants (EBCs), not lawyers, have historically been the ones reviewing PBM contract pricing — and why most ERISA lawyers have never been trained to catch the profit centers buried inside ✅ Why an EBC's compensation disclosure often contains a "tainted disclaimer" that quietly leaves the door open to indirect PBM payments calculated on a book-of-business basis rather than per plan ✅ Why Section 202 of the Consolidated Appropriations Act (CAA) puts plan sponsors — not PBMs or EBCs — on the hook for ERISA fiduciary breach lawsuits tied to conflicted consulting relationships ✅ Why Paul expects the same fee-only shakeout that hit 401(k) advisors after the 12b-1 fee lawsuits to eventually hit PBM-compensated benefit consultants too WHY THIS MATTERS A standard PBM contract can run 50 to 60 dense pages of AWPs, WACs, discounts, and minimum rebates — dense enough that even ERISA lawyers who aren't PBM specialists routinely miss the profit centers built into the pricing provisions. Historically, that review has fallen entirely to employee benefit consultants, some of whom are quietly compensated by the very PBMs they're supposed to be holding accountable, at a rate Paul pegs at roughly five to ten times what the plan sponsor pays the consultant directly. With the CAA now exposing plan fiduciaries to lawsuits over exactly this kind of conflict, an independent third-party contract review is no longer just good purchasing discipline — it's legal risk management. MENTIONED IN THIS EPISODE EP379 with AJ Loiacono: Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 07:41 What are Paul's usual observations when a PBM contract crosses his desk? 08:34 "If you just sign … one of their model contracts …, you're probably gonna pay 30% to 40% above market on your drug spend." 12:11 What is a PBM lawyer? And why is it important to find an ERISA PBM lawyer? 17:12 EP379 with AJ Loiacono. 17:40 Who is on the hook for the cost of the PBM contracts? 21:05 What's the problem with most ERISA lawyers today? 22:56 Lawsuit about a PBM contract. 27:43 What's Paul's advice for benefits consultants? 31:40 How much might a plan sponsor be paying their consultant versus what a consultant might be making from a PBM?

Certificate of Need (CON) laws and Certificates of Public Advantage (COPA) laws are two state-level attempts to control healthcare costs and competition — and, as is often the case with well-intentioned policy, the results in practice haven't matched the intent. Ann Kempski, an independent health policy consultant, joins Stacey Richter to dig into why roughly 35 states still operate CON programs designed to prevent costly oversupply but that often end up entrenching the market power of already-dominant health systems, and why the newer COPA laws — which trade antitrust scrutiny for state oversight of hospital mergers — drew a formal warning from the Federal Trade Commission. WHAT YOU'LL LEARN ✅ Why Certificate of Need (CON) laws, designed to prevent costly oversupply, often end up favoring the biggest, already-consolidated health systems instead ✅ The four recurring problems that lead states to repeal their CON laws, even though the original intent behind them was reasonable ✅ How Certificate of Public Advantage (COPA) laws immunize hospital mergers from antitrust review by substituting state oversight for competition — and why the FTC formally warned states against enacting them ✅ Why weak state oversight after a COPA-approved merger, as seen in Tennessee with Ballad Health, can leave a newly dominant health system with little real accountability ✅ Why a systematic review of 90 studies found that the costs of CON laws tend to exceed their benefits WHY THIS MATTERS CON and COPA laws are reminders that good intentions in healthcare policy aren't the same as good oversight. Both were designed to control costs — CON by limiting supply, COPA by allowing state-sanctioned hospital mergers — but both tend to produce the same outcome: bigger, more consolidated health systems with less competitive pressure to keep prices in check. States retain real leverage to shape competition in their own healthcare markets; the CON and COPA experience shows that leverage has to be paired with sustained oversight of outcomes, not just good intentions at the point of passage. MENTIONED IN THIS EPISODE EP224 with Suzanne Delbanco, PhD: Apple Podcasts | Spotify | Other Apps EP437 with Brian Klepper, PhD: Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 06:20 Ann remembers Suzanne Delbanco. 06:55 EP224 with Suzanne Delbanco. 07:40 What are state Certificate of Need laws? 08:44 Why are states getting rid of these CON laws? 13:26 Why CON laws are created. 15:43 EP437 with Brian Klepper, PhD. 16:09 What are the conflicts of interest and problems that arise when CON laws are created? 20:55 What happens when states get rid of these CON laws? 24:10 How are Certificate of Public Advantage laws different from CON laws? 27:58 Why does the research show that COPAs don't usually accomplish their goals? 31:34 What encouraging current events are happening in the realm of COPA laws? 32:08 Gloria Sachdev, PharmD, of Employers' Forum of Indiana.

This episode is dedicated to Marshall Allen, the investigative journalist and founder of Allen Health Academy, who passed away in May 2024. Dave Chase, founder of Health Rosetta, joins Stacey Richter to share reflections on Marshall's decade-plus of accountability journalism — including the yearlong ProPublica investigation into health insurance broker commissions that helped shape the Consolidated Appropriations Act of 2021 — and on the faith that grounded his work. After Dave's tribute, Stacey replays her original 2021 interview with Marshall about his best-selling book, Never Pay the First Bill, in which he explains upcoding, why patients are treated as outsiders in their own healthcare system, and why he considered employers healthcare's "sleeping giant." WHAT YOU'LL LEARN ✅ How Marshall Allen's yearlong ProPublica investigation into health insurance broker commissions helped shape the Consolidated Appropriations Act of 2021, regarded by many as the most consequential employee healthcare legislation since 1943 ✅ Why Marshall believed his five years in Christian ministry made him a better journalist — not in spite of his faith, but because of it ✅ What upcoding is and how it functions as one of many revenue-generating schemes built into the healthcare system ✅ Why patients are treated as outsiders rather than customers in a system where stakeholders primarily serve each other ✅ Why Marshall considered employers healthcare's "sleeping giant" — and what it would take to wake them up WHY THIS MATTERS Marshall Allen spent 17 years investigating why Americans pay so much for healthcare and get so little in return, and his reporting didn't stay confined to journalism — it shaped federal legislation and gave patients, employers, and health system leaders a shared language for naming problems that had long gone unnamed, from upcoding to profiteering dressed up as ordinary profit. His book, Never Pay the First Bill, turned that reporting into a practical playbook patients could use immediately, while his message to executives was equally direct: the financial toxicity a health system creates eventually becomes reputational and recruiting toxicity too. His journalism, his legislative impact, and the Allen Health Academy he founded to carry his mission forward are the legacy this episode honors. MENTIONED IN THIS EPISODE Encore! EP328 with Marshall Allen: Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 09:28 What's the point of view that Marshall is coming from with his investigative reporting? 09:57 "How does this affect the people who are paying for it and the people who are undergoing the care?" 10:49 "There's a lot of good people working within this very messed up system." 11:03 Why are patients considered outsiders in the healthcare system? 11:45 "What's happened in healthcare is that the stakeholders treat each other more as the customer." 13:45 What is upcoding? 17:18 "These are schemes that have been created within the industry to increase revenue." 17:46 "This system is not set up for the benefit of the patient." 18:13 "On the financial side, the industry is actually oppressing the American people." 19:14 "We have been expected to pay whatever aggregate sum is thrown at us." 20:21 Why have patients been so passive toward this crooked healthcare system so far? 22:05 What's the difference between making a profit and profiteering? 29:45 What are the first-order and second-order consequences of what's happening in healthcare right now, and which of these consequences will actually drive change? 30:45 "When you tell the truth about what's going on … they become so ashamed … that they change their behavior." 32:00 "The patient … is not their most important customer." 32:50 "The sleeping giant is the employers."

The number one cause of hospital readmissions during chemotherapy is dehydration — which is treatable with a simple, inexpensive anti-nausea medication. Stacey Richter plays an outtake from her earlier conversation with Andreas Mang of Blackstone's Equity Healthcare and then works through four ruminations sparked by it: why PBMs restricting nausea meds to save a few dollars can quietly generate thousands in downstream medical costs, and why fee-for-service so often fails to pay for the very side-effect management that keeps patients out of the ER in the first place. WHAT YOU'LL LEARN ✅ Why the total cost of care — PBM spend and medical spend combined — is the only number that actually reveals whether a "savings" is real or just cost shifted somewhere else ✅ Why a value-based purchasing mindset, rather than a pure cost-containment mindset, is often what's actually cheaper once downstream costs are counted ✅ Why some oncology centers do integrative oncology and proactive side-effect management for real, while others don't — and why payers and employers should be asking which is which ✅ Why fee-for-service so often fails to pay for proactive side-effect management, rewarding providers for reacting to a crisis rather than preventing one ✅ Why studies have shown that managing chemo side effects properly can both save money and meaningfully extend patient survival time WHY THIS MATTERS A PBM that restricts a $5-to-$1,430-a-month nausea medication can save itself a little money while driving thousands of dollars in downstream ER and readmission costs — and unless someone is aggregating PBM and medical data into one total-cost-of-care view, that trade gets recorded as a win instead of the loss it actually is. This dynamic isn't unique to oncology; it's a pattern that shows up anywhere cost containment is measured in a silo instead of against total spend. For employers and plan sponsors, the fix starts with insisting on aggregated data and asking pointed questions about how providers and payers are actually managing (or not managing) the proactive, less flashy work that keeps patients out of the hospital. MENTIONED IN THIS EPISODE EP157 with Ethan Basch, MD: Apple Podcasts | Spotify | Other Apps EP435 with Dan Mendelson: Apple Podcasts | Spotify | Other Apps Encore! EP372 with Cora Opsahl: Apple Podcasts | Spotify | Other Apps EP331 with Al Lewis: Apple Podcasts | Spotify | Other Apps EP370 with Erik Davis and Autumn Yongchu: Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 01:12 Andreas Mang on oncology medication side effect management. 03:12 Mark Lewis, MD's Tweet. 03:39 Celena Latham's response. 04:22 How integrative oncology can save money and what it looks like. 04:47 EP157 with Ethan Basch, MD. 06:20 Why PBMs saving money doesn't necessarily mean savings for employers and payers. 07:36 EP435 with Dan Mendelson. 08:20 Encore! EP372 with Cora Opsahl. 08:40 EP331 with Al Lewis. 09:50 Stacey's second rumination. 10:19 Why having a value mindset when purchasing is a thing. 10:42 Stacey's third rumination. 12:03 EP370 with Erik Davis and Autumn Yongchu. 13:07 Why FFS does not pay or pay adequately for side effect management. 14:31 Stacey's final rumination. 17:08 Summarizing Stacey's four ruminations on this topic.

The tables get turned this episode: it's Stacey Richter being interviewed, by Abby Burns of Advisory Board's Radio Advisory podcast, recorded live at the Raising the Value Bar Summit. Abby asks Stacey why she started the show, how she personally defines value, and why value is genuinely in the eye of the beholder — especially in an industry where, as Stacey puts it, one person eats the dinner, someone else orders it, and a third person pays for it. WHAT YOU'LL LEARN ✅ Why value in healthcare is so hard to pin down when the patient, the orderer, and the payer are often three different parties with three different definitions of a win ✅ The origin story behind Relentless Health Value: a primary care practice that cut total cost of care by 17% and got acquired and dissolved by a health system anyway, and the $100 million spend increase that followed ✅ Daniel Kuzmanovich's four tensions in measuring healthcare value: short-term versus long-term, individual patients versus populations, output versus outcome, and proven versus experimental approaches ✅ Why driving change in healthcare isn't the hard part — sustaining it is, and why so many value wins quietly unwind after the person who drove them moves on ✅ Why Stacey believes it's important to understand which of these tensions you personally sit on, and how misalignment across them is what actually drains value out of good ideas WHY THIS MATTERS Value in healthcare doesn't fail to materialize because good ideas are scarce; it fails because the person eating the dinner, the person ordering it, and the person paying for it are misaligned on what winning even looks like. Understanding Daniel Kuzmanovich's four tensions — timeline, whose value, what kind of value, and how proven it needs to be — gives stakeholders a shared vocabulary for diagnosing exactly where those misalignments are happening. And the case study underlying this whole show, a practice that objectively lowered cost of care and got shut down for it anyway, is a reminder that sustaining value requires more than just achieving it once. MENTIONED IN THIS EPISODE Encore! EP391 with Scott Conard, MD: Apple Podcasts | Spotify | Other Apps EP438 with John Lee, MD: Apple Podcasts | Spotify | Other Apps EP400 with Stacey Richter (solo, manifesto Part 2): Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 03:33 Stacey's journey and mission. 04:16 The story of Scott Conard, MD (Encore! EP391). 09:28 Why it's important not just to drive change but to sustain it. 12:23 Heart Failure: A Case Study in Value. 14:13 EP438 with John Lee, MD. 15:07 Why patient positive value often fails instead of succeeds. 18:07 How financial toxicity has become clinical toxicity in healthcare. 19:44 How cultural norms have evolved into healthcare challenges. 23:38 The story of Mike Tuggy, MD, in Washington. 25:13 Looking at the four tensions in measuring value as continuums. 25:37 Why timeline is important in creative value in healthcare. 28:34 What are the four ways to measure value in healthcare? 29:27 How do payers and providers collaborate to align on value metrics? 31:26 Why will proven versus experimental treatments become more important in the next few years? 34:54 Stacey's manifesto (EP400) and values for personal integrity in healthcare. 38:55 Stacey's parting advice.

David Muhlestein, PhD, JD, has a specific number in mind for the optimal size of a physician practice: 10 to 20 docs, plus supporting team. Big enough to afford the back-office functions and technology that come with scale, small enough that the practice stays collegial, local, and able to act on its own values rather than corporate policy. He joins Stacey Richter to dig into what happens once organizations grow well past that size — and into the "diversification discount" that quietly punishes big health systems trying to be fiduciarily responsible for both primary care and specialty care at once. WHAT YOU'LL LEARN ✅ Why 10 to 20 doctors is David's answer for the optimal practice size — large enough for economies of scale, small enough to preserve autonomy and shared values ✅ What the "crisis of autonomy" is, and how practices move through the phase David calls delegation as they grow ✅ What the Diversification Discount is on Wall Street, and why it applies with even more force to health systems that fund primary care by taking money away from specialty care ✅ Three concrete options for organizations wrestling with this tension: splitting into aligned business units, decentralizing to restore practice-level autonomy, or having the board directly confront what its actual values are ✅ Why boards — especially nonprofit boards often dominated by finance backgrounds rather than medicine or public health — need to ask whether their organization's value comes from market power or from improving community health WHY THIS MATTERS There's a paradox sitting at the center of most large, consolidated health systems: good primary care reduces the need for (and revenue from) specialty care, yet many systems fund primary care precisely by redirecting specialty care revenue. That's not a sustainable alignment of incentives, and pretending otherwise doesn't make the diversification discount go away. Whether the fix is organizational bifurcation, genuine delegation of autonomy back to practice-level teams, or a hard look from the board about what the organization is actually for, the underlying question is the same: is this organization's value coming from market and political power, or from an actual ability to improve patient and community health? MENTIONED IN THIS EPISODE EP412 with Robert Pearl, MD: Apple Podcasts | Spotify | Other Apps EP438 with John Lee, MD: Apple Podcasts | Spotify | Other Apps EP437 with Brian Klepper, PhD: Apple Podcasts | Spotify | Other Apps EP432 with Kate Wolin, ScD: Apple Podcasts | Spotify | Other Apps EP421 with Jodilyn Owen: Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 00:00 Introduction 08:12 From a business and patient/better outcomes standpoint, what does an optimal provider practice look like? 11:48 EP412 with Robert Pearl, MD. 13:06 Why isn't the current landscape what David considers optimal? 14:53 What leads to the "crisis of autonomy"? 15:13 How do medical practices get to the phase of delegation? 17:39 EP438 with John Lee, MD. 18:55 EP437 with Brian Klepper, PhD. 20:53 EP432 with Kate Wolin, ScD. 20:55 EP421 with Jodilyn Owen. 24:45 What metrics should boards of directors also be held accountable for? 28:48 Why is an efficiency-focused business not necessarily the best at managing population care? 31:13 What is the "diversification discount"? 35:53 What can primary care doctors do to optimize their practices? 36:48 Why do we need to shift the mindset from "bigger" and "more"?

Traditional PBMs make billions of dollars on generic drugs simply by paying pharmacies less than what patients pay at the counter — buying low and selling high on the spread. Luke Slindee, PharmD, senior pharmacy consultant at Myers and Stauffer (the firm that calculates the NADAC benchmark for CMS), returns to offer a different fix than the one covered in the Ge Bai episode: adjusting the "usual and customary" price construct for generic medications that has gotten wildly inflated over time. WHAT YOU'LL LEARN ✅ What a "usual and customary" price is, and the logical, behavioral-economic reasons it has become so inflated for generic drugs ✅ How PBMs end up setting both what a pharmacy charges the patient and what the PBM pays the pharmacy for the same transaction — and why that dual role is what makes spread pricing possible ✅ Whether pharmacies should be allowed to maintain two separate cash prices, and how GoodRx fits into the pharmacy/PBM dynamic ✅ How the Amazon anticompetitive contract lawsuit connects back to pharmacy contracts with PBMs ✅ What it would actually take for the generic drug market to return to normal, competitive pricing WHY THIS MATTERS Generic drugs are supposed to be the cheap, boring part of pharmacy benefits, but spread pricing has turned them into a reliable profit center for PBMs at the direct expense of patients and pharmacies. The fact that 79% of the time a patient in their deductible phase pays less using GoodRx or a cash-pay option than using their own insurance is not a fluke of the market; it's the predictable result of a usual and customary pricing construct that PBMs have every incentive to keep inflated. Fixing this isn't just about saving patients money at the counter — it's about correcting a pricing mechanism that quietly undermines the entire premise of having insurance for generic drugs in the first place. MENTIONED IN THIS EPISODE EP395 with Brennan Bilberry: Apple Podcasts | Spotify | Other Apps EP420 with Ge Bai, PhD, CPA: Apple Podcasts | Spotify | Other Apps EP418 with Mark Cuban and Ferrin Williams, PharmD, MBA: Apple Podcasts | Spotify | Other Apps === LINKS === 🔗 Show Notes with all mentioned links: Episode Page ✉️ Enjoy this podcast? Subscribe to the free weekly newsletter 🫙 Support the podcast with a small donation to the Tip Jar 🎤 Listen on Apple Podcasts 🎤 Listen on Spotify 📺 Subscribe to our YouTube channel === CONNECT WITH THE RHV TEAM === ✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X 08:12 Where do cash prices fall when pharmacies have contracts with PBMs? 08:39 What is a usual and customary price? 12:14 How is the usual and customary price affected by PBMs? 16:49 Should pharmacies be allowed to have two sets of cash prices? 17:14 Where does GoodRx fit into this because of the pharmacy/PBM dilemma? 19:06 What's happening with Amazon and the anticompetitive contract lawsuit, and how does it relate back to pharmacy contracts with PBMs? 00:00 Introduction 20:38 EP395 with Brennan Bilberry. 21:05 EP420 with Ge Bai, PhD, CPA. 23:27 Why is there a new wave of cash-only pharmacies? 24:02 EP418 with Mark Cuban and Ferrin Williams, PharmD, MBA, from Scripta. 25:41 What would allow the generic market to return to normal competitive pricing? 26:39 How does this dysfunction create a negative downstream effect?