Relentless Health Value

How Hospitals Engineer $800,000 Claims and What Plan Sponsors Can Do About It

A single coronary artery bypass graft — no complications, went perfectly normally — billed at $800,000. Not a hypothetical. Eric Bricker, MD, heard it directly from the head of benefits at a major self-funded employer. In this episode, Stacey Richter speaks with Dr. Eric Bricker, internist, former hospital finance professional, co-founder of Compass Professional Health Services, and creator of the AhealthcareZ YouTube channel, about the three-prong hospital playbook used by consolidated health systems to maximize revenue from high-cost claimants. The mechanisms are deliberate, coordinated, and — as Dr. Bricker puts it — hidden from employers. But they can be countered.

WHAT YOU'LL LEARN

✅ How provider stop-loss contract provisions work: hospitals negotiate a threshold (e.g., $200,000 in billed charges) above which the carrier pays 70% of billed charges instead of a fixed case rate, then deliberately structure their charge master so that threshold is exceeded on virtually every case — not just the complicated ones

✅ Why the "240% of Medicare" network discount statistic obscures employer exposure: it's a simple average across thousands of codes, not volume-weighted — so an $800,000 CABG running at 1,200% of Medicare gets averaged down by thousands of lower-cost codes like dermatology, ENT, and maternity

✅ Why carriers have no financial incentive to stop this: over 60% of commercially insured lives are self-funded, so carriers bear no risk on commercial claims — and accepting high commercial rates is the quid pro quo for hospitals accepting near-Medicare reimbursement on the carrier's Medicare Advantage book

✅ How hospitals complete the playbook by acquiring cardiology or specialty practices to lock in steerage — buying the primary care referral network, the specialty group, and the surgical facility — so if an employer isn't steering members, a well-funded hospital system already is

✅ Why direct contracting gives self-insured employers structural leverage: unlike carriers, employers have no Medicare Advantage exposure, so they can negotiate directly at 170–200% of Medicare for elective services (orthopedic spine, total joint, cancer care) — rates centers of excellence will accept because volume matters

WHY THIS MATTERS

Total hospital costs are roughly half of most plan spend, and 0.5 to 1% of members can account for 30 to 40% of total plan dollars. The playbook Dr. Bricker describes — stop-loss provisions, charge master engineering, intentional steerage — is not improvised. Hospital systems hire major consulting firms to design it. As Dr. Bricker says: deception is a good business practice if you're trying to maximize revenue. Plan sponsors who understand this have both the incentive and a roadmap to respond.

=== LINKS ===

🔗 Show Notes with all mentioned links: Episode Page

📺 Dr. Bricker's AhealthcareZ Channel

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=== CONNECT WITH THE RHV TEAM ===

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00:00 Introduction.

05:06 From a hospital revenue perspective, where do high-cost claimants fall?

08:45 How do hospitals structure their stop-loss provisions so that they ensure they're always maximizing their revenue?

12:15 How hospitals acquire providers to steer as many patients as possible through specific service lines.

20:21 Why do carriers let hospitals get away with these rates and stop-loss negotiations?

21:06 How do Medicare Advantage and Medicare rates play into all of this?

22:00 What should a benefit consultant be doing here?

23:37 What are the keys to direct contracting?

27:21 Why is it important to get trusted relationships set up ahead of time?

28:04 The Company That Solved Health Care by John Torinus Jr.

29:23 What needs to be the clinical consideration for specialists?

30:46 What is the advantage that employers have in all of this?

33:06 Dr. Bricker's video on 32 examples of healthcare deception.

Recently on Relentless Health Value, we've been tinkering around with a few recurring themes — recurring through lines — that are just true about American healthcare these days. In this episode, host Stacey Richter speaks with Dr. Christine Hale about high-cost claimants and the implications for healthcare plans in 2025 and beyond. They discuss the importance of trust in patient care, the financial incentives behind patient steering, and the critical role of timely and comprehensive data analysis. Dr. Hale emphasizes the need for an integrated approach to medical and pharmacy claims data to avoid expensive consequences and improve patient outcomes, and shares strategies for plan sponsors to manage high-cost claimants through evidence-based care, appropriate treatment settings, and creative problem-solving — all while underlining the importance of patient engagement and satisfaction.

WHAT YOU'LL LEARN

✅ How the definition of a high-cost claimant is changing — and why buy-and-bill pharmaceuticals are becoming one of the most expensive line items plan sponsors don't see coming

✅ What plan sponsors are getting wrong about high-cost claimant management, and why integrating medical and pharmacy claims data is the prerequisite for catching problems before they become expensive

✅ Why starting small — rather than trying to overhaul everything about high-cost claimant management at once — is the more effective and sustainable path for most plan sponsors

✅ The concrete steps employers should take to improve high-cost claimant spend: evidence-based care pathways, appropriate treatment settings, and creative problem-solving grounded in trust and patient engagement

✅ Why relationships and trust between patients and care teams are not a soft add-on but a precondition for steering high-cost claimants toward the right care at the right time

WHY THIS MATTERS

High-cost claimants are a small share of any plan's population but an outsized share of its spend, and the mechanisms driving those costs — buy-and-bill pharmaceutical markups, fragmented data, and misaligned steering incentives — are largely invisible to plan sponsors until the bill arrives. Dr. Hale's message is that this is manageable: with integrated data, evidence-based protocols, and a willingness to start small, plan sponsors can meaningfully bend the high-cost claimant curve without waiting for a systemic fix.

MENTIONED IN THIS EPISODE

EP462 with Scott Conard, MD: Apple Podcasts | Spotify | Other Apps

EP468 with Matt McQuide: Apple Podcasts | Spotify | Other Apps

EP371 with Erik Davis and Autumn Yongchu: Apple Podcasts | Spotify | Other Apps

EP467 with Stacey Richter: 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.

05:22 What is a high-cost claimant, and how is the definition changing?

07:42 Why buy-and-bill pharmaceuticals can be so costly for plan sponsors.

10:19 What are plan sponsors getting wrong about this situation?

11:28 What do you need as an employer to understand your plan data fully?

17:35 What are plan sponsors currently doing that they should not being doing?

19:54 Why starting small is important.

25:37 What are the steps employers should take to improve their high-cost claimant spend?

In this episode, host Stacey Richter revisits a conversation with Nikki King, CEO of Alliance Health Centers, discussing the critical issues facing rural hospitals and healthcare systems. They delve into the impacts of Medicaid cuts, the financial struggles of rural hospitals reliant on commercial insurance, and potential solutions like freestanding emergency rooms, telehealth, and the expanded roles of nurse practitioners. The conversation also covers the complexities of maternity care and mental health services in rural areas, emphasizing the urgent need for systemic reforms to ensure equitable access to healthcare.

WHAT YOU'LL LEARN

✅ How dire the rural hospital situation is right now, and why freestanding ERs are one of the few financially viable paths forward for communities that can no longer support full inpatient care

✅ Why broadband access — not clinical capability — is one of the biggest roadblocks to telehealth actually solving rural health access problems

✅ The "hot potato" of nurse practitioner scope of practice: physician residency slots aren't increasing while the population is, making expanded NP roles less optional and more necessary

✅ Why maternity care access keeps shrinking in rural America even as the ability to treat high-risk cases improves elsewhere — specialization is raising the ceiling on care quality while lowering the floor on access

✅ Why national Medicaid, folded under the same structure as Medicare, is the "easiest low-hanging fruit" reform available to stabilize rural healthcare economics

WHY THIS MATTERS

Rural communities are, in Nikki King's words, trying very hard to hang on to what they have — and the market plans available to them are often unaffordable even when they exist. The single biggest challenge to moving toward a model that incentivizes keeping people healthy, rather than just treating them after the fact, is the same challenge rural healthcare has always faced: too few resources spread across too much geography, with policy that hasn't caught up to that reality.

MENTIONED IN THIS EPISODE

EP312 with Douglas Eby, MD, MPH, CPE: 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

📺 Subscribe to our YouTube channel

🎤 Listen on Apple Podcasts

🎤 Listen on Spotify

=== CONNECT WITH THE RHV TEAM ===

✭ LinkedIn ✭ Threads ✭ Bluesky ✭ X

00:00 Introduction.

08:14 How dire is the rural hospital situation right now?

08:33 How could freestanding ERs be a potential solution for rural hospitals?

09:56 Advice from CHQPR: Rural hospitals should not be forced to eliminate inpatient care.

11:22 Why is broadband a roadblock to telehealth as a solution for rural health access?

14:52 What are other potential rural health access solutions?

15:37 The "hot potato" of nurse practitioners in the healthcare world.

16:34 "The number of residencies for physicians each year is not increasing, but the population … is increasing."

22:00 What's the issue with maternity care in rural America?

24:09 "As healthcare becomes more and more specialized, [the] ability to treat high-risk cases is better, but access gets worse."

27:57 How is mental health care affected in rural communities?

28:29 "Rural communities are trying very hard to hang on to what they have."

29:52 "When you look at the one market plan that's available in a rural community, you probably can't afford it."

31:37 What's the single biggest challenge to moving to a model that incentivizes keeping people healthy?

32:32 "The easiest low-hanging fruit … is having national Medicaid and have that put under the same hood as Medicare."

In Part 2 of Episode 469, host Stacey Richter discusses the implications of Medicare site-neutral payments and Health Savings Account (HSA) reforms with James Gelfand, president and CEO of the ERISA Industry Committee (ERIC). The episode details how plan sponsors should adapt to Medicare's site-neutral payment policies aimed at curbing hospital consolidation and inflated prices through facility fees and markups. Gelfand provides insights into how HSA reforms currently in Congress could expand the scope of preventive care covered before deductibles are met, benefitting both employers and employees. The conversation also touches on the challenges high-deductible health plans pose and the potential benefits of codifying recent IRS guidance to allow greater flexibility in pre-deductible coverage. The discussion underscores the importance of plan sponsors staying ahead of Medicare policies to avoid higher costs.

WHAT YOU'LL LEARN

✅ What Medicare site-neutral payment policy actually means, and why it's designed to stop hospitals from charging a facility fee markup simply because a service happens to be delivered on a hospital campus rather than in a physician's office

✅ Why the site-neutral push is starting narrow — and what action steps plan sponsors should be taking now to align their own contracts with where Medicare policy is headed, rather than waiting for it to catch up to them

✅ What options plan sponsors have in highly consolidated markets where there may be no non-hospital-owned alternative to steer members toward

✅ How the proposed HSA reform bill could change pre-deductible coverage — expanding what preventive care can be covered before a member hits their deductible

✅ Why the thinking behind HSA usage has shifted since their inception, and why codifying recent IRS guidance on pre-deductible coverage would give employers more flexibility without abandoning the high-deductible plan structure entirely

WHY THIS MATTERS

Site-neutral payment reform and HSA modernization are both, in Gelfand's framing, catch-up plays — policy trying to close gaps that self-funded plan sponsors have been absorbing the cost of for years. The plan sponsors who benefit most from these changes will be the ones who understand the mechanics well enough to align their own contracting and plan design ahead of the regulatory curve, rather than reacting to it after the fact.

MENTIONED IN THIS EPISODE

EP471 with Christine Hale, MD, MBA: Apple Podcasts | Spotify | Other Apps

EP371 with Erik Davis and Autumn Yongchu: Apple Podcasts | Spotify | Other Apps

EP448 (Part 1) with Shawn Gremminger: Apple Podcasts | Spotify | Other Apps

INBW41 with Stacey Richter: 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.

05:42 What does Medicare site-neutral payments mean?

08:59 How do markups play into the dynamics here?

09:52 Upcoming episode with Christine Hale, MD, MBA.

10:36 What does the "narrow" start for these changes mean?

11:42 What action steps should plan sponsors be taking?

13:01 What options do plan sponsors have in highly consolidated markets?

15:46 Will this bill potentially make changes to HSA plans?

17:40 Why has the thinking behind healthcare usage changed since the inception of HSAs?

23:24 How are preventive care and first-dollar coverage connected within the context of HSAs?

25:48 Why would it be difficult to completely get rid of a high-deductible health plan and offer HSAs without them?

In Part 1 of this two-part episode, Stacey Richter speaks with James Gelfand, President and CEO of the ERISA Industry Committee (ERIC), about the potential effects of proposed Medicaid cuts on plan sponsors and their members. They explore ways plan sponsors can prepare for the changes, including Medicaid's four major areas of possible cuts: reducing waste, fraud, and abuse; implementing work requirements; reeling in provider taxes; and addressing the "Cornhusker Kickback" from the ACA. The conversation also delves into how state governments and hospitals might respond to these cuts and suggests actions for plan sponsors to mitigate potential impacts. The episode is part one of a two-part series, with the second episode covering Medicare site-neutral payments and HSA reforms.

WHAT YOU'LL LEARN

✅ The four main areas Congress is actually looking at for Medicaid cuts: reducing waste, fraud, and abuse; work requirements; reeling in provider taxes; and addressing the "Cornhusker Kickback" carve-out from the ACA

✅ What the "Cornhusker Kickback" is and why it's become a flashpoint in the current Medicaid cuts debate

✅ What plan sponsors should be doing right now to prepare for potential Medicaid cuts, before the policy details are finalized

✅ What's likely to happen to hospitals — particularly those heavily reliant on Medicaid reimbursement — under the proposed cuts

✅ How hospital consolidation compounds the risk of these Medicaid cuts, and why a more consolidated market has fewer options to absorb the shock

WHY THIS MATTERS

Medicaid cuts don't stay contained to the Medicaid population — when hospitals lose Medicaid revenue, they look elsewhere to make up the difference, and commercial plan sponsors are usually the next stop. Understanding the four levers Congress is actually considering, rather than the political noise around them, is what lets plan sponsors get ahead of the cost-shifting before it shows up in their own claims data.

MENTIONED IN THIS EPISODE

EP464 with Al Lewis: 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.

05:22 What's happening with Medicaid cuts?

06:47 What are the four main things congress is actually looking at in cutting Medicaid?

09:12 What is the Cornhusker Kickback?

16:46 What should plan sponsors be doing right now to prepare for these potential Medicaid cuts?

20:04 What's going to happen to hospitals with these proposed Medicaid cuts?

23:41 How does hospital consolidation affect the potential future with these Medicaid cuts?

In Episode 468, host Stacey Richter engages in a conversation with Matt McQuide, CEO of Synergy Healthcare. This episode delves into the critical assumptions surrounding member engagement within the healthcare industry. Key points discussed include the role of employers in steering plan members, the importance of member engagement for navigating the healthcare marketplace, and Matt's three major misconceptions about health plan membership. Matt also presents real-life examples of how engagement significantly impacts health outcomes, emphasizing that relationships and trust are paramount. The episode concludes with practical strategies for employers to enhance engagement and manage employee health effectively.

WHAT YOU'LL LEARN

✅ Matt's three common assumptions that employers make about member engagement — and why each one is wrong in practice

✅ Why "health is actually hard" is the starting point for any real engagement strategy, not a caveat to work around

✅ Why it's critical to meet people at the moment their need for healthcare sparks their own interest in their health, rather than trying to engage them proactively before they're ready

✅ Why relationships and trust matter more today for employee health and member engagement than they used to — and why most people don't actually want "optimal" health, they want to feel better

✅ Why employers, in Matt's blunt framing, "don't want to fix healthcare" — and what it actually takes to solve the "middle way" between doing nothing and overhauling everything

WHY THIS MATTERS

It's easy to forget that claims are real people. Matt's core argument is that member engagement fails when it treats people as line items to be nudged rather than individuals who need to be met where they are, with trust built over time. Employers who understand this — and who are honest about what they actually want from a member engagement program — are the ones who see results.

MENTIONED IN THIS EPISODE

EP463 with Betsy Seals: 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.

06:28 What are Matt's three common assumptions that employers make about member engagement?

07:08 "Health is actually hard."

08:19 Why is it important to meet people when their need for healthcare sparks their interest in their health?

11:29 "It didn't take much … it just takes time."

13:53 Why are relationships and trust more important today for employee health and member engagement?

16:04 Do people actually want optimal health?

17:44 Why is it important to meet people where they are today?

22:38 "Employers don't want to fix healthcare."

24:10 Why it's important to remember that claims are real people.

24:38 Quote from Steve Schutzer, MD, about EP463 with Betsy Seals.

26:44 How do you solve the "middle way"?

In this solo episode, host Stacey Richter dives into the intricate relationship between increased emergency room (ER) visits and the lack of access to effective primary care. Drawing on insights from recent episodes featuring experts like Matt McQuide, Dr. Christine Hale, and others, Stacey explores how inadequate primary care leads to skyrocketing ER costs, which now account for 6% of total healthcare spending. Key points include the systemic issues driving this trend, the incentive misalignments within hospitals and insurance carriers, and the importance of establishing trust and relationships in primary care. The episode also discusses perspectives from healthcare professionals and thought leaders on potential solutions to realign healthcare incentives and improve patient outcomes.

WHAT YOU'LL LEARN

✅ How the last six shows on Relentless Health Value connect into a single through line: primary care access failures showing up downstream as ER spend

✅ Where the primary care through line connects to carriers — and why following the dollar through carriers and hospitals reveals who actually benefits from the status quo

✅ What a Health Affairs study shows about the scale of the ER cost increase problem, and why it's accelerating rather than leveling off

✅ How hospital board directors' incentives affect hospital price increases — and why board composition is an underexamined lever in the cost conversation

✅ Why trust and relationships in primary care are not a soft, secondary concern but the actual mechanism that keeps patients out of the ER in the first place

WHY THIS MATTERS

Six consecutive episodes converging on the same theme is not a coincidence — it's a signal. ER spend is now 6% of total healthcare spending, and Stacey's argument is that this number is a symptom, not the disease: it reflects a primary care system that isn't built to build trust or catch problems early, so patients end up in the most expensive setting possible by default rather than by choice.

MENTIONED IN THIS EPISODE

EP466 with Vivian Ho, PhD: Apple Podcasts | Spotify | Other Apps

EP463 with Betsy Seals: Apple Podcasts | Spotify | Other Apps

EP384 with Wendell Potter: Apple Podcasts | Spotify | Other Apps

EP407 with Vivek Garg, MD, 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

00:00 Introduction.

02:16 Connecting the dots between the last six shows.

05:56 EP384 with Wendell Potter.

14:38 Where does the primary care through line connect to carriers?

17:13 Health Affairs study showing ER cost increases.

19:19 Kevin O'Leary's Health Tech Nerds newsletter.

20:47 How are hospital board directors affecting hospital price increases and why?

21:49 Upcoming episode with Matt McQuide.

Healthcare costs keep rising, but what's driving those increases? In this episode, Stacey Richter speaks with Dr. Vivian Ho, a health economist at Rice University and Baylor College of Medicine, to break down the real reasons behind skyrocketing commercial insurance premiums. Are insurance premiums rising faster than wages — and why does it matter? What's the biggest driver of premium increases? (Spoiler: It's hospital prices.) Are hospital price hikes justified by rising costs — or is something else at play? Dr. Ho shares data-backed insights on hospital consolidation, executive incentives, and how health system pricing impacts self-insured employers and plan sponsors. If you're a healthcare executive or a jumbo employer managing benefits, this episode is a must-listen.

WHAT YOU'LL LEARN

✅ Whether insurance premiums are actually outpacing wage growth — and what the data shows about the gap between what employers pay for insurance versus what employees take home

✅ What's really causing hospital prices and insurance premiums to go up so exponentially — and why it isn't simply a story of rising costs of care

✅ Whether razor-thin operating margins for hospitals are actually behind these rising hospital prices, or whether that explanation doesn't hold up against the data

✅ How these hospital cost increases actually happen mechanically, and what a study by Zack Cooper, PhD, reveals about the pattern

✅ Who typically makes up a hospital board, and why those board members' own financial incentives can end up driving hospital price increases — making board-level change a vital lever

WHY THIS MATTERS

The story hospitals tell to justify rising prices — thin margins, rising costs — doesn't match what Dr. Ho's data shows. Real change, in her view, has to start at the board level, because that's where the incentives that actually drive pricing decisions live. For jumbo employers and healthcare executives, understanding this dynamic is the difference between negotiating from a position of insight and negotiating blind.

MENTIONED IN THIS EPISODE

EP450 with Marilyn Bartlett, CPA, CGMA, CMA, CFM: 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 ✭ Bluesky ✭ Threads ✭ X

00:00 Introduction.

05:12 Are insurance premiums going up?

05:59 What is the disparity between cost of insurance and wage increases?

06:21 LinkedIn post by Byron Hugley.

06:25 Article by Michael Strain.

06:46 How much have insurance premiums gone up for employers versus employees?

09:06 Chart showing the cost to insure populations of employees and families.

10:17 What is causing hospital prices and insurance premiums to go up so exponentially?

12:53 Article by (and tribute to) Uwe Reinhardt.

15:28 Are razor-thin operating margins for hospitals causing these rising hospital prices?

16:56 Collaboration with Marilyn Bartlett and the NASHP Hospital Cost Tool.

19:47 What is the explanation that hospitals give for justifying these profits?

23:16 How do these hospital cost increases actually happen?

27:06 Study by Zack Cooper, PhD.

27:50 Who typically makes up a hospital board, and why do these motivations incentivize hospital price increases?

33:17 Why is it vital that change start at the board level?

The Hidden Costs of PBMs: How Aggregate Discount Guarantees Inflate Drug Prices.

In this episode, host Stacey Richter interviews Chris Crawford, CEO of RxSaveCard, about the inflated costs within the pharmacy benefits industry. The discussion centers around a lawsuit involving J&J, highlighting how large PBMs can significantly overcharge for drugs that are available much cheaper through cash-pay options like Mark Cuban's Cost Plus Drugs. Crawford explains how Aggregate Discount Guarantees, a common contracting mechanism, often fail to control spread pricing effectively and instead may lead to higher costs for plan sponsors and employees. The episode also covers how RxSaveCard can help employers and employees access these lower cash prices, circumventing the inflated costs from traditional PBMs.

WHAT YOU'LL LEARN

✅ What an Aggregate Discount Guarantee is, and why it's a common PBM contracting mechanism that plan sponsors assume protects them from spread pricing

✅ Why divergent list prices and perverse incentives prevent Aggregate Discount Guarantees from actually limiting cost spread the way they're marketed to

✅ Why it's critical for plan sponsors to check actual drug cost prices themselves — and how employers can go about checking them

✅ What drives drug costs lower, and why that mechanism changes the calculus for plan sponsors willing to look past traditional PBM contracts

✅ How RxSaveCard works, whether a PBM's permission is needed to use it, and what it looks like in practice for employers and employees accessing lower cash prices

WHY THIS MATTERS

The J&J lawsuit at the center of this episode is a case study in how much room exists between what a PBM charges and what a drug actually costs through cash-pay alternatives like Cost Plus Drugs. Aggregate Discount Guarantees are sold to plan sponsors as protection, but Crawford's argument is that the math underneath them is built to obscure spread pricing, not eliminate it — and tools like RxSaveCard exist precisely to let employers route around that structure.

MENTIONED IN THIS EPISODE

EP365 with Scott Haas: Apple Podcasts | Spotify | Other Apps

EP397 with Paul Holmes: Apple Podcasts | Spotify | Other Apps

EP439 with Luke Slindee, PharmD: Apple Podcasts | Spotify | Other Apps

EP379 with AJ Loiacono: Apple Podcasts | Spotify | Other Apps

EP461 with Chris Crawford: Apple Podcasts | Spotify | Other Apps

EP356 with Ge Bai, PhD, CPA: 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 ✭ Bluesky ✭ Threads ✭ X

00:00 Introduction.

07:44 What is the Aggregate Discount Guarantee?

13:49 Why do the divergent list prices and the perverse incentives prevent the Aggregate Discount Guarantee from really limiting cost spread?

17:55 Why is it important for plan sponsors to check these drug cost prices, and how can employers check them?

23:56 What drives cost lower, and why does it change everything?

25:09 How does RxSaveCard work?

30:01 Do you need a PBM's permission to use RxSaveCard?

30:37 How does it look for employers/employees to use the RxSaveCard?

Emergency room costs now make up 6% of total healthcare plan spending — why? In this episode, host Stacey Richter welcomes Al Lewis to break down the data behind rising ER expenses, separating fact from fiction. They discuss whether increased patient acuity or widespread upcoding is driving costs, the impact of the No Surprises Act, and why plan sponsors struggle to negotiate fair ER rates. Plus, Al shares actionable strategies for employers to push back against inflated charges. If you want to understand the hidden forces behind escalating ER bills, this is a must-listen.

WHAT YOU'LL LEARN

✅ What's really going on in ER visits, and how big of a deal the total spend actually is at 6% of total plan spending

✅ Why ER visit prices are going up when the underlying acuity of care, in many cases, isn't — and what that gap tells you about upcoding

✅ What the major source of unexpected medical debt actually is, and why code creep is a bigger driver than most plan sponsors realize

✅ Why plan sponsors are structurally unable to negotiate emergency room services the way they can negotiate other parts of the network

✅ Why it matters not to agree to consent when you go in to visit the ER — and what concrete steps plan sponsors can take to proactively limit ER spending for their employees

WHY THIS MATTERS

ER spend at 6% of total plan spending isn't simply a reflection of how sick people are — it's shaped by code creep, consent practices, and a negotiating dynamic that structurally favors the hospital. Al Lewis's message is that plan sponsors aren't powerless here; they just need to understand the mechanics well enough to push back before the bill is finalized, not after.

MENTIONED IN THIS EPISODE

EP415 with Rob Andrews: Apple Podcasts | Spotify | Other Apps

EP386 with Al Lewis: 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

📺 Subscribe to our YouTube channel

🎤 Listen on Apple Podcasts

🎤 Listen on Spotify

=== CONNECT WITH THE RHV TEAM ===

✭ LinkedIn ✭ Bluesky ✭ Threads ✭ X

00:00 Introduction.

08:32 What is going on in ER visits, and how big of a deal is the total spend?

10:16 Why is the price of ER visits going up when it should be going down?

11:59 What is the major source of unexpected medical debt?

13:27 What is code creep, and why is it happening?

16:26 Why are plan sponsors unable to negotiate emergency room services?

25:53 Why is it important not to agree to consent when you go in to visit the ER?

31:28 What steps can plan sponsors take to be proactive about limiting ER spending for their employees?