Solving Employee Health Care | Brian Whorley & KELSEY HILBRICH

Brian: Hey, everybody. My name is Brian Whorley. I'm the CEO and founder of Paytient. We are a, FinHealth company based here in Columbia, Missouri. Founded it back in April 2018.

I spent the better part of almost 2 decades working at, at a hospital just right over there. And absolutely loved, being part of a team in a place that people would turn to and all the really difficult personal moments that we all lived through, in life. Over those years, I kind of watched, you know, more and more folks come in our doors with, just an expression of, anxiety, uncertainty on their face when it came time to pay for care. Experience, the pain for care, was often like the most painful part of the whole experience. And I wanted to do something about that.

So April of the whole experience. And I wanted to do something about that. So April 2018, founded Paytient. We've ventured back. We've raised about $55,000,000 in equity to date.

One of our largest and most meaningful investors, Ali Hamed, spoke last night. If anybody saw him, it's been it's been great. But, yeah, we spend all day every day on one single mission, which is to help people better access and afford health care. And happy to share some of our perspectives and experiences with that today.

Kelsey: And maybe in the in that vein, I guess, what are the risks that business owners should really be thinking about?

Brian: Yeah. I think it's it's it's it's interesting. So, like, when we first started Paytient, we were we were super super small, and, like, we only had one job to do during that time, which was find customers, please customers, and keep customers. Like, whatever your business, that's that's the core job. And so, we effectively, you know, outsourced how we buy health care to an agent and that agent was called Anthem, right?

We just paid a full, we paid our insurance premiums every single month and all of our folks knew that, you know, if if whether it's a behavior based issue or a biological based issue, sort of ordinary extraordinary, Those folks had coverage and, gosh, every provider, in the whole country can, you know, knows how to provide care and sell them care via in insurance. As we've grown though, and as you grow from like 5 employees to 10 employees to 50 employees and larger, like, you really you really you really have 2 businesses. You have your core business, which is what you love. It's your passion. It's what you're building.

It's what where the all the enduring value is and like what gives you fulfillment. And then this other business that you, like, will own is basically become an insurance business where you're assessing the risks of the employees who work for you. And you have to kind of both with an I and an e, that our folks are able to be at their tip top, you know, health and productive members of our company, productive members of of society.

Kelsey: So yeah. Yeah. No. It's, you know, as we talked about, right, cost is is skyrocketing, and so it's one of the only things that you can do. And so I guess in that vein, what what trends are people not talking about in terms of

Brian: these risks? Yeah. I think, yeah, like, that's that I I think our session is, like, a little mistitled because it's, like, solving employee health care. And I think, you know, the the takeaway to leave here is maybe some of our perspective is, like, the premiums are going to continue to go up, period. And there's a few reasons.

One of the reasons I'll kinda talk through is, like, I don't think it gets as much attention. Like, the world really changed on September 23rd 2010. So on that day, as part of the Affordable Care Act, the, lifetime limits were removed, from insurance plans. So, you know, prior to that day, if you had an insurance plan, something like a 109,000,000 Americans prior to that day had insurance plans that had, like, a lifetime limit. So there was a cap to, like, what the insurer would ultimately pay over the course of time for every however long you had that.

And part of the Affordable Care Act, one of the things was like, hey, gosh. That doesn't feel right. We should remove that. There's very there is a whole bunch of news articles and a whole bunch of things you can go back and look at. They're like they all cited this one PricewaterhouseCoopers study.

So, and it's not to bang up on Pricewaterhouse. Like, but there was one PricewaterhouseCooper study that said there's very, very little, like, frequency of $1,000,000 plus claims. Like, this this doesn't happen very much today. And so, hey, gosh. Like, it's only gonna cost an extra $8 per employee per month, like, across the country in order to remove those lifetime limits because of the absence of these large claims.

Like, it just isn't happening. I think, like, what that failed to do is it it's like a case study of incentive and imagination. And, like, if you okay. Well, by removing that lifetime limit, you effectively, like, by fiat, have created, like, employers then, insurers. They now have unlimited obligation as the buyer.

Like, they're unlimited buyers. And so, you know, all along in parallel path, you have this, like, Human Chino project and, like, that got mapped. And then, you know, you essentially have these really, really, you know, talented and and thoughtful, like, innovators out there in in in the world who are looking at rare diseases, which, you know, back in 1983, the Orphan Drug Act passed and the FDA defined a rare disease as something that affects less than 200,000 people in the country. And so, like, there's people walking around with like maybe only a few thousand people who have that condition. And so, forever and ever, like maybe like pharmacies or researchers or entrepreneur minded clinicians who are like, gosh, like, that's you know, I'd love to be able to do something about that, but there's just too small of a population to, like, serve.

You know, like, revenue equals price times volume. Like, just the volume of lives there is not enough. And with these lifetime limits, like, it's gonna cost me too much to bring something to market. Well, in 2010, when that lifetime limit went away, all of a sudden that p in the revenue equation could could change. And so, you could then innovate and invest and bring something to market.

And technology, you know, enable that, like, with the mapping of the genome and advancements in computing, like, all of a sudden now, it's like, well, there's buyers of unlimited ability and and obligation. Gosh. We can actually bring this to market. And if we charge x, like, that's a viable market for us. And so, you know, in a way, like, that's actually a beautiful thing.

Like, if you you know, there's a 100000 Americans with sickle cell, right? Probably not many folks in this room by the look of it, but like, there's a 100,000 folks with sickle cell. And that's something that, you know, it's not what you eat. It's not your decisions. Like, you're you're bored with that.

And for 60% of folks, it's like a major thing. Some people describe it as like feeling stabbed with a knife all day every day. So, like, there's now a cure, like, not a therapy, but an actual cure. Like, it's a genetic cure to where, you know, they're gonna put you through the whole process. It's gonna cost 3 and a half $1,000,000.

But on the other side of that, you're cured. And so the first person there's a this there's a patient named, I think her name is Victoria. And she talked about the process that she went through this, and she talked about the day after. She described it as being reborn. Like, if you can imagine, like, it's a whole new life for her.

And it's a whole new way that she'll live her life. That's an amazing thing. And I wanna live in a country that has that capability and has that, like, ingenuity to, like, bring those things to market. Should it cost 3 a half 1000000 or should it cost 1,000,000? I I don't know.

Right? Like, private company. I'm a capitalist. I'm conflict conflicted with all this. But but but like, that's an amazing thing.

And like, and honestly, if if that were you, your spouse, your partner, your child, like, you'd want that capability out there. In fact, like, you'd want more and more of those. And so the good side of the coin is that there are more and more of those coming. Like OptumRx, like, huge thing. They're like, hey, there's 7 more genetic treatments like that.

And, actually, it's gonna increase the incidence rate. And, like, if you employed 10,000 people, oh, just on those 7 treatments, odds are 4% of your folks, like, may have one of those. So, that's less than one person. So, you have to ask. We have to be a really, really big employer for that to matter.

But there's like 100 of these in the pipeline. And so those are all coming. And so, like, the idea is that, like, by removing in that lifetime limit, it effectively created a new market. It drew innovators to it, and it has expanded like the curative and the therapeutic envelope. That's a great thing.

But the flip side is, is this created this real challenging, you know, dilemma for employers and insurers to say, how are we or how are we gonna deal with that? How, you know, what's how's it going going to work? So just because you could go self funded, I think you have to think through, like, should you? And then, how do you manage your your sort of, exposure? It's the the things that are driving, I think, you know, the cost of the plans to go higher.

It's it's on that side of the equation, the extraordinary side. And and the thing is, like, the incident rate of those things are going to increase even more because of these therapies coming in in into market. I don't think that Genie goes back in the bottle. I think that that, like, we want that as a nation, but I think we're gonna struggle with how do we finance that, how do we pay for that. And so, as insurance plans have, like, flexed up to cover those large, large expenses, they've like they they feel like, okay, I've gotta insure more and more of this.

I'm gonna insure less and less of of of this on the on the downside. And that's why I think deductibles have increased over the years. And that's where, like, we fill in functionally to help people pay for care, access care, afford care.

Kelsey: So if you if you wrap all that up, which is costs are are going up into the right, what is employer sponsored health care look like 10, 15, 20 years from now?

Brian: Yeah. Or, like, what we're doing today, our perspective, like, what we do every day at Paytient is we have in our mind, I think it's clear in our mind what we think health care looks like in 2,040 and beyond. And what we're doing today is essentially laying the rails for that future as it comes into to to view. So my perspective is that, you know, the government's role is best when it's stabilizing markets in order for them to work more efficiently. A 100 years ago, you know, we decided that, hey, we should ensure that food producers produce can produce food and risk their capital every every every year.

So we created this, you know, federal crop insurance corporation to help, you know, bail out farmers and to take risks. We've kind of tried to insure them against catastrophic risk of crop failure and drought and and crop disease. We do that with bank failure through the FDIC. We do that with floods, with the National Flood Insurance Program. We do it with pension failure, with the pension benefit guarantee program.

And so, you know, in my mind, I think in my lifetime, at some point, we'll have to see something around this idea of a reinsurance program. So I'm not talking government insurance. I'm talking like some sort of reinsurance for these extraordinary, you know, massively catastrophic things where, like, truly, you as an employer, you know, if if it turns out I hire somebody and cost instead of, you know, their salary being $50,000 a year, it's it's actually $3,000,000 a year. I I can't I I can't I can't swing that. Right?

Mike, all of us can't swing that. The school districts we work with can't swing that. And so, I think that that has some play in the world and and certainly for that you open up with this, like, I think the government is already beginning to step in and say, well, here's what we're gonna buy these pharma, these 10 drugs at this price. I think that we have to be really, really, really cautious around does that chill or limit, that innovation that is really sort of coming on the on the scene. So I think that that's a really, really tricky thing that's gonna require a purple solution, one that that works, for everyone.

Yeah.

Kelsey: I think we're gonna open up for for questions for Brian. Your primary?

Brian: For Paytient, we partner with employers and insurers to ensure, that all of their health plan members can easily and effortlessly pay for care. What we have found is is so we provide, there's about, there's about 700,000 people walking around America who have about $1,000,000,000 worth of buying power in their purse pocket wallet that we have provided to them. So they what we're doing is what we're really doing is, like, functionally, we're helping people to pay for care by providing them a plan sponsored credit as a part of their health plan. But really, strategically, what we're doing is is we're changing. When someone knows they have an ability to pay for care, it changes how they go about getting care.

And so, ultimately, what we're doing is trying to affect the behavior side. We're trying to get folks into providers, into therapists, pick up their their, pharmacy prescriptions easily, you know, consuming care that they should be consuming, which is early care and cost effective care, and ultimately tries to, you know, steer away or lessen the chance of those sort of extraordinary, costs. And certainly, we're taking pain and frustration, you know, out of the the picture today. So, we sell into large employers, insurers, employers like, you know, Hyatt Hotels offers Paytient to all other folks. The PGA will be offering Paytient to all of its folks working on the TBC Resorts, Russell Silver Chocolates, even large insurance companies.

Yeah. They're not unaware of the aberration of the out of pocket. Just the out of pocket was out of reach for them. And so, we've partnered with most of the large payers in this country. If you pull out your insurance card and look at that logo, there's a really good chance that we work with them in some way, somewhere to help their plan members more easily and effortlessly pay for care.

Providers should should reasonably expect to be appropriately repaid for their work. Like, they're taking care of folks. You know, they can't control who walks in in their door. That takes a long, long, long time and a lot of investment for doctor Wheeler to become doctor Wheeler. Like, he's one of the smartest, most well trained people on the planet, literally, like, as physicians.

Like, that that requires, you know, an appropriate amount of, of of of reimbursement. So what we're trying to do is to bring providers and patients, you know, together more effortlessly. As small business owners, you know, what we do is we subsidize. We provide a high deductible health plan. We provide direct primary care to our folks.

We provide, a health savings account. We try to give people as much, like, tax free, compensation as possible. We do that through the HSA. Like, it's not part of your benefits. It's part of your salary.

It's all part together. But, like, if you want to over insure yourself, or pay or buy more insurance, you can do so. We we work with really we try to work with really, really good benefit consultants and brokers. There's one sitting in the room right right right there and right there. And so, that's that's what we we're trying to do.

We're ourselves. We're moving into the self funding world. We want the data. We want to see what what what's here. We want to protect ourselves.

And so, ultimately, we want to shift from being a passive payer of care to an active buyer of care, like as an employer. And so we wanna be judicious and understand, like, hey, we work really, really hard for these dollars that come in our door. The dollars that go out our door, like, let's be let's be good stewards of that as as as well. And and more importantly, let's help our in our employees not just pay for care, but buy care. Like, it's one thing to know the price of care.

It's another thing to be able to actually pay that price. We wanna do do both. Appreciate it.

This transcript was generated with Transistor AI