Alternatives to Traditional Insurance | Adam Wheeler

Adam: Doctor Adam Wheeler. I apologize that they're, gonna be overbranded. The, the reason for that is we just started, raising some money, and I repurposed those slides for this purpose. So, but my team looks good, and they're yellow stuff. So I'm, caveats and disclaimers.

I'm a I'm a doctor, who's trying to make health care better for patients and populations. So I'm not an insurance broker or a lawyer or an accountant or a lot of other things. So, but I think that's part of the problem is there aren't enough doctors, care providers who are in this space trying to understand the issues. And so, therefore, the the systems that have been created are not necessarily what's best for people. And, the costs have been driven up to a place that's, like, really terrible, to be honest.

So I think a paradigm that I wanna introduce, I stole it from somebody. I don't remember who. So if you've heard it before, it's their work, not mine, but I think it's helpful. And that's to think of care into 2 buckets, extraordinary care and ordinary care. So extraordinary care is is typically things that are not predictable.

This is surgery. This is emergency. True emergencies. Right? Not like the ear infection that goes to the ER, but like the appendicitis, Cancer, typically are branded medications.

I was talking to somebody yesterday that has an employee that has a a med that's a $180,000 a month, and they were trying to figure out how to make the health plan affordable. Just can't. Right? It's impossible. And then there's ordinary care.

There's things like primary care, and I'm a I'm a primary care doctor, colds, flu, but also product diseases like obesity and high blood pressure, mental health conditions. I would include in this both the management of them with medications, but also the management of counseling, OT, PT, speech therapy, injuries, and generic medications. Alright? And these are things that you can fairly well pretty easily predict, what those expenses are gonna be in a given year for population. And about 65% of humans in the United States will have some expense in the ordinary category and something more like 5 to 10% just depending on how you define it will need something in the extraordinary category.

There is kind of a third bucket that, of course, the American health system has created, and it's kind of the the predict predictable high cost system. And so these are people who are on a high cost med. So that person that's on a a 40 or $80,000 MET a month, that you know about, and they're they're on your roll. So you get the claims data, and you're like, oh, okay. Well, there's our problem right there.

That's somebody I didn't know about. I don't know who it is, obviously, for for HIPAA reasons, but there is a very high cost claim that's going to recur over and over again forever. Okay? So 2 big categories. So, you know, a lot of this is gonna sound very self serving, which might be because I'm a really bad salesman.

It might also be and as I've I at least try to make this reality is because I dove in to try and solve this problem, and this is where we're at. So I think I think the problem is primary care. Okay? And I create a company around that, which is why I'm talking about this. So primary care, this is your family medicine doctors, your pediatricians, your general internists.

Alright? Those are the people who are on the front lines. You have your ongoing relationship with these folks. And they, plan to be the first touch for anything you're dealing with, whether that be a mental health concern, chronic disease, and acute condition. And this little map over here is a county by county map of the health professional shortage areas, which is an official designation by the US government.

And the, the dark, the darkest color are the entire county is a shortage area. Okay? The the lighter color in the middle there means that some part of the county is a shortage area. And the, the little ones that you can barely even see, except for a few counties on the East Coast, are the there are no shortage areas in that county. Right?

So the entire country is a primary care shortage area. I'm from Missouri, and something like all but one of our counties are primary care shortage areas, which means here in Columbia, which is where where we're located, if you're in if you need an appointment with your primary care doctor, it will be, if it's a new if you're a new appoint a new sorry. Need a new appointment, it's about 3 months. If it's a mental health condition, plan on it being 9 months. And if you're an established patient, it's usually 2 to 6 weeks.

So you call and say, I've got a sore throat. Can you get me in today? Everyone's going to say no. I know why why would you do that? How did this get here?

What are the incentives that landed us here? Well, first of all, the the federal government limits the number of physicians that are trained in residency programs each year in the United States. And that law was passed in 97 and has not been updated since. So they're just not getting very mint. Missouri is estimated to be 1300 primary care provider short.

Right? 1,300 just for Missouri. And, like, the University of Missouri School of Medicine, where I graduated from, is producing a few dozen primary care doctors each year. Right? Which is about the same number that are retiring.

We're never catching up. Right? Urgent cares have popped up as a solution to this. Right? Between my office and the nearest grocery store, there are 3 urgent cares.

Why is that? It's because people have needs. They can't get in. And so they pop into an urgent care. Urgent care should have no role in our health care system.

Alright? Urgent care only has a role when primary care doctors like me fail to get patients in. Why would I fail to get patients in? So, our clinic is different. So, we'll slide that aside.

But, my sister-in-law is a primary care doctor at a large health system. And, she's allowed one open slot per day for people who call in that day. Alright. She has 3,000 patients on our panel. She gets one slot a day.

Now, why would the health system do that? Well, what do they do with the other patients? They shunt them to urgent care, right, where they're seen and get to charge a facility fee, so an extra fee, and they get to see a nurse practitioner who's lower cost than the physician. And, statistically, those nurse practitioners, at urgent cares do more tests, and the net dollars that come in are higher and the costs are lower. It's it's really hard.

I mean, you hate to be the cynical, but I guess I'm not cynical. So fewer PCPs equals a more profitable health system. Right? That's just that's just the way it works. And the net the other issue is, as a primary care doctor, we were approached by a local health system who volunteered to absorb us into their system, which means they're gonna buy us without paying us anything.

Right? So why what was what was the offer? Well, we will be able to bill underneath their tax ID number and use their contractual rates. So we're like, well, how much are your contractual rates? Well, of course, they couldn't tell us.

That's a violation of law. But we could both tell a third party who could calculate the delta and then tell us the answer to that. Okay. So we did, and they were getting 3 x what we were getting for the same services. Right?

So we said, well, this is dumb. So we pediatrician, we had half the children in Missouri. So we went to the carriers and said, look. We've got half children in a 100 mile radius. We would like to negotiate.

We don't think we should get paid $65 for an office visit anymore. And they said, how about 62? They refused to negotiate, and we didn't have the market power to do anything about our rates. And so they just continued to push them down. So the mess.

Right? So, I started listening to podcasts, to be honest, and it heard about this, direct primary care model. Okay. So what I'm gonna tell you now about BigTree, I keep I'll use BigTree, but you can look for direct primary care in your community, and you can typically find someone. There are about 2,000 physicians in the United States who are using direct primary care as a model.

It's a monthly membership model, and you get primary care for a monthly membership. What happens is it really aligns incentives between the care team and the patients and often the people who are paying the bill, okay, which may or may not be the patient. It may be an employer. What I'm really a big fan of the marketplace swooping in to solve this problem, But market dynamics don't work if you don't have knowledge of price and you don't have knowledge of what you're getting for the price. You don't understand the value that you're you're purchasing.

Right? So if I tell you, you can get a back MRI for $2,000, do you need a back MRI? The guy that owns the MRI says you do, but does that mean you actually do? So having primary care on your team that you're paying a monthly fee, then they can help people interpret this is the place you need to be going. It really solves that side of service problem.

So at Big Tree, this is what our model is. It's about $70 a month for a a membership, and then we provide acute care, like strep throat strep throat and flu. We manage our chronic diseases. We do in office gynecology. We prescribe mental health medications.

Then we've kind of hit this new idea of, hey. If you're a member, we're making plenty of money off of you, so we can add some other services on top of that that we just charge you cost for. Right? So, we have a counselor on staff that's $25 a visit. We're trying to acquire a group that does speech and OT and PT PT and autism therapy.

We built a pharmacy. So we own a pharmacy, and we the generic meds are so freaking cheap that we just include them for free in the membership. Like, do you know how much a Z Pak costs to buy it? Like, actually to buy the Z Pak. It's a dollar 40.

Right? A month of Prozac is, like, 30¢. Okay. So when you pay a $10 co pay for Prozac, right, most of that actually goes to the pharmacy benefit manager. So it's, anyway, it's a mess.

We gotta deal with Quest so we can get labs for 90% less than the contract that the have with the lab. We have a team of nurses. You can message through an app 247 so you can get you can ask the question. My 2 year old has a 105 fever. Should we be going to the ER?

Right? That's that's a terrifying situation. But if somebody you know can say, no. You're fine. We'll see you first thing in the morning.

And you say, really? They're like, yeah. It's fine. It completely transforms the cost structure. We can also do some fun things.

So we do, like, Botox and hormone pellets and, like, I don't really like some of that stuff, but I have providers who are, like, wanting to do the training. So then we just charge cost for those things. Right? Because, again, we're making money off the membership. We're doing fine.

So think I've got well, I'll just how much time do I have left? Like, a minute? 7. I'm fa fast. Okay.

So, what happens if you put this into a group plan? So let's say you've got I mean, to echo what Kelsey said, if you've got more than 50 employees, you should be asking why am I not in a self funded health plan. K. It's not appropriate for every group of any size, I guess, but you should at least ask the question. Right?

And, like, we were talking earlier, finding a broker who's open minded and tracking this stuff is, like, the key. So my favorite guy is actually here, Dan, and Dan's like an super open minded guy that is willing to think outside the box. You also have to have an open minded HR person. Right? So I've had these conversations with CEOs before.

They're like, this is amazing. Let's do this. And they go to the HR person. The HR person is like, and they freak out and convince a CEO to back off. Okay?

So these solutions are out there, but you have to have an appetite for innovation. Otherwise, you just get stuck in a book of plan that goes up 18% every year. Right? That's just the way the game is played. So, here are just some examples of how direct primary care can affect, the bottom line.

So, you know, if somebody has an injury and instead of going to urgent care and spending $500, that's just part of the services that we would offer. Or I used this example before, somebody has a rash and a fever that we can see the following morning. Right? And they don't need to be in the ER, but they don't know that. Right?

That takes medical knowledge. With chronic diseases, this example, somebody's got type 2 diabetes and hypertension, and they are using alcohol to deal with their depression. And these are, like, real examples, And we can get them switched over, and this guy's now spending $28 a month instead of almost $2 a or $20 a year instead of $2 a year. Right? And the $20 is his lab cost.

So if you apply this to a group that's on a self funded health plan, the costs go down, like, tremendously. So there's an American Society of Actuaries report that shows that models like this, really simple models, simpler than what we typically do, lower cost by 10%. We've got groups now that we've taken down by by 50% in 12 months. If you're a really small business, you know, under 50, there's 2 ideas I wanna throw out there. 1 is, here in Columbia, we have about 200 businesses that buy Big Tree membership as their only benefit.

Right? They can't afford a big plan, so it's just they just been 70 a month. The other are share plans. If you've not played in the share plan world, that has evolved a lot. They used to be for Christians only.

You had to sign a statement of faith. Now there are several that that's not true. This is what I use for my employees. So my employees, we pay 2, 2.80 a month for employees over the age of 30, and then it covers all cost over 1,01500. Right?

So there's a lot of caveats there, but it's a really, really good solution, for most employers who have smaller employers, and love to talk about the caveats if you have interest about that later. But thanks, guys.

This transcript was generated with Transistor AI