Benjamin Schwartz, MD, MBA: You got to start kinda nudging the giant. And I think from the physician standpoint, that is … the simplest thing is just educate yourself, understand what's going on, take an interest in it, and that's how you start. And then you go from there. And not everybody, you know, needs to go to DC and lobby, and not everybody needs to get an MBA and try to, you know, become an MD MBA administrator.
But I think just educating yourself on what's going on around you is the first step. And, you know, sharing podcasts like Relentless Health Value or, you know, keeping your ear to the ground is the first step. Knowledge is power.
For a full transcript of this episode, click here.
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Stacey: Waking up the sleeping giant that is physicians. That is what I talk about today with Dr. Ben Schwartz. And look, just like employers who have been called the sleeping giant of healthcare for years, this term is both flattering (the giant part) and a lot or maybe a little offensive (the sleeping part). So, you're welcome and very sorry in equal parts.
Now, this conversation began with Suhas Gondi, MD, MBA, in episode 523, who wrote an article in NEJM directed at physicians. He wrote this article with his co-author, Zirui Song, MD, PhD, about the sleeping giant that is self-insured employers and imploring them to please wake up and take back the power and agency that paying for healthcare for something like 60% of Americans really should afford them.
The thing is, though, about employers being a sleeping giant, is that it's hard to take back power and agency. There's three Relentless Health Value episodes with Lauren Vela (EP406), Lee Lewis (EP508), and Elizabeth Mitchell (EP491) about the why it's hard for both internal inside the employer reasons, and then also external ecosystem market reasons why it is very hard to wake up. It's challenging for employers.
But in this latest episode (EP523) with Dr. Suhas Gondi, I kinda turn the tables on him and say, "Well, if employers are sleeping giants, why not physicians? Why can't physicians also be sleeping giants who can take back their power and agency and go about the fixing of the American healthcare system?"
So, do go back when you have a sec and listen to that opening salvo, that shot across the bow, if you will.
But I wanted to jump in deeper on this topic, so I shanghaied (successfully) Dr. Ben Schwartz, who I was justifiably confident would be able to take this conversation one layer deeper. Because look, doctors—all clinicians really, but let's just focus on physicians today—there are many who are suffering in the current regime.
But while I hear the rants and about the burnout and some pretty horrible stories, I don't see much flat-out revolting or coup d'états, at least at the big-picture level, with the probable one exception of clinicians/physicians who listen to this show, who I would not discount at any level. It seems like for every physician picking up a torch, there are, like, a thousand others who don't seem to be.
Dr. Ben Schwartz and I first talk about all of the reasons why it is actually pretty tough for many docs to grab the reins and gallop off in a different direction. Then we list a bunch of directional ways forward despite the obstacles.
Dr. Ben Schwartz, my guest today, as I have mentioned multiple times already, is an orthopedic surgeon who is currently seeing patients in the office a couple of days a week at a safety net system.
He also works as a medical director at an MSK (musculoskeletal) company. And lastly, do not delay checking out his Substack, The Surgeon's Record, and his posts on LinkedIn, which are frequently very great.
With that, here we go. Here is my conversation with Dr. Ben Schwartz. This is Relentless Health Value.
Thank you so very much to our series sponsor this year, Payerset. Also, thank you so much to Patient Rights Advocate, who gave us a lovely financial donation that is so helpful to keep this show on the air. Also, lastly, thank you so much to our founding sponsor, Aventria Health Group.
Also mentioned in this episode are Suhas Gondi, MD, MBA; Zirui Song, MD, PhD; Lauren Vela; Lee Lewis; Elizabeth Mitchell; Payerset; Patient Rights Advocate; Aventria Health Group; Yashaswini Singh, PhD; Graham Walker, MD; Rebecca Andrews, MD; Eric Bricker, MD; Christopher Habig; Andrew Tsang; Steve Schutzer, MD; Dean Jargo; Alex Sommers, MD, ABEM, DipABLM; and Astia Health.
For a list of healthcare industry acronyms and terms that may be unfamiliar to you, click here.
You can follow Dr. Schwartz on LinkedIn and read his blog on Substack.
Benjamin J. Schwartz, MD, MBA, is a physician executive and fellowship-trained orthopedic surgeon with nearly two decades of musculoskeletal experience. After 17 years in clinical practice—including success in CMMI's BPCI-A program and numerous leadership roles—he has stepped away from the operating room to build a portfolio career spanning clinical care, healthcare technology, and health policy.
Ben is currently a nonoperative orthopedic physician at Cambridge Health Alliance and medical director at RightMove Health, where he oversees clinical quality for its musculoskeletal triage platform. Through his consulting practice, Good Bones Medical Advisory, he advises health-tech start-ups and provides expert opinions through national eConsult platforms. He chairs the Practice Management Committee of the American Association of Hip and Knee Surgeons and serves on the editorial board of the Journal of Arthroplasty.
Ben writes The Surgeon's Record, exploring the intersection of healthcare delivery, business strategy, and physician leadership. He is passionate about reimagining musculoskeletal care through thoughtful integration of technology, operational excellence, and a renewed focus on the doctor-patient relationship.
00:00 Introduction to this episode.
01:20 EP523 with Suhas Gondi, MD, MBA.
01:25 New England Journal of Medicine article by Zirui Song, MD, PhD, and Suhas Gondi, MD, MBA.
02:07 EP491 with Elizabeth Mitchell.
04:55 The conversation with Benjamin Schwartz, MD, MBA.
05:05 "Waking up" the sleeping giant of physicians.
07:40 The risks to a doctor who speaks up.
09:51 EP474 with Yashaswini Singh, PhD.
10:24 LinkedIn post by Graham Walker, MD.
11:35 How going independent has changed for young doctors.
16:06 EP536 with Rebecca Andrews, MD.
18:08 EP404 with Suhas Gondi, MD, MBA.
19:51 EP481 with Dr. Schwartz.
19:34 Bridging the world between physicians and healthcare administration.
21:40 What the next version of independent healthcare looks like.
22:06 EP529 with Eric Bricker, MD.
22:20 LinkedIn post by Christopher Habig.
23:20 What MSOs are and how they play into independent practice.
24:36 EP521 with Andrew Tsang.
25:38 Where ASCs play into independent practice.
26:51 The potential for direct contracting in independent practices.
28:28 EP294 with Steve Schutzer, MD.
30:55 Where collective action might fit into this.
Recent past interviews:
Click a guest's name for their latest RHV episode!
Dr Rebecca Andrews, Robyn Leone, Kimberly Carleson, Frank Pennachio, Chris Klomp, Evan Anderson, Jake Velie and Keith Hartman
[00:00:00] You gotta start kind of nudging the giant. And I think from the physician standpoint, that is, the simplest thing is just educate yourself, understand what's going on, take an interest in it. And that's how you start. And then you go from there and not everybody needs to go to DC and lobby and not everybody needs to get an MBA and try to, you know, become an MD MBA administrator. But I think just educating yourself on what's going on around you is the first step and, you know, sharing podcasts like Relentless Health Value or, or,
[00:00:30] you know, keeping your ear to the ground is the first step knowledge is power. American healthcare entrepreneurs and executives you want to know talking relentlessly seeking value. Waking up the sleeping giant that is physicians. That is what I talk about today with Dr. Ben Schwartz.
[00:00:59] And look, just like employers who have been called the sleeping giant of healthcare for years, this term is both flattering, the giant part, and a lot or maybe a little offensive, the sleeping part. So you're welcome and very sorry in equal parts.
[00:01:19] Now this conversation began with Dr. Suhas Gandhi in episode 523, who wrote an article in NEJM directed at physicians.
[00:01:30] He wrote this article with his co-author, Dr. Zuri Song, about the sleeping giant that is self-insured employers and imploring them to please wake up and take back the power and agency that paying for healthcare for something like 60% of Americans really should afford them. The thing is, though, about employers being a sleeping giant is that it's hard to take back power and agency.
[00:02:00] There's three Relentless Health Value episodes with Lauren Vela, Lee Lewis, and Elizabeth Mitchell about the why it's hard for both internal inside the employer reasons and then also external ecosystem market reasons why it is very hard to wake up.
[00:02:21] It's challenging for employers. But in this latest episode 523 with Dr. Suhas Gandhi, I kind of turn the tables on him and say, well, if employers are sleeping giants, why not physicians? Why can't physicians also be sleeping giants who can take back their power and agency and go about the fixing of the American healthcare system?
[00:02:45] So do go back when you have a sec and listen to that opening salvo that shot across the bow, if you will. But I wanted to jump in deeper on this topic. So I shanghaied successfully Dr. Ben Schwartz, who I was justifiably confident would be able to take this conversation one layer deeper. Because look, doctors, all clinicians, really, but let's just focus on physicians today.
[00:03:12] There are many who are suffering in the current regime. But while I hear the rants and about the burnout and some pretty horrible stories, I don't see much flat out revolting or coup d'etage, at least at the big picture level. With the probable one exception of clinicians, physicians who listen to this show, who I would not discount at any level.
[00:03:38] It seems like for every physician picking up a torch, there are like a thousand others who don't seem to be. Dr. Ben Schwartz and I first talk about all of the reasons why it is actually pretty tough for many docs to grab the reins and gallop off in a different direction. Then we list a bunch of directional ways forward despite the obstacles.
[00:04:03] Dr. Ben Schwartz, my guest today, as I have mentioned multiple times already, is an orthopedic surgeon who is currently seeing patients in the office a couple of days a week at a safety net system. He also works as a medical director at an MSK, musculoskeletal company. And lastly, do not delay checking out his substack, a surgeon's record and his posts on LinkedIn, which are frequently very great. With that, here we go. Here is my conversation with Dr. Ben Schwartz.
[00:04:32] My name is Stacey Richter. This is Relentless Health Value. Thank you so very much to our series sponsor this year, Payerset. Also, thank you so much to Patient Rights Advocate, who gave us a lovely financial donation that is so helpful to keep this show on the air. Also, lastly, thank you so much to our founding sponsor of Aventria Health Group. Dr. Stan Schwartz, welcome to Relentless Health Value. Thanks for having me back. Always a pleasure to join.
[00:05:01] Well, it is always a pleasure to speak with the likes of you. We often talk about the sleeping giant of employers, and it's not necessarily a compliment. It sort of is. I think the giant part is good. It's the sleeping part that we really want to work on. Right. So let's talk about the waking up. You know, you can think about physicians who are the ultimate deliverers of care here.
[00:05:24] And sometimes it feels like are getting pushed around maybe in a way that some might consider surprising. There's an epidemic of burnout. It seems like there's a lot of like, I'm on the Reddit too often, honestly, according to my phone. There's definitely a lot of like you go in some of these subs. The rants are long and detailed. For sure. Yeah.
[00:05:53] I mean, I think it's a catharsis. I think it's more effective when it leads to the next step and make it constructive and make change. And it's not easy, but I think it's more effective when that sort of anger, discontent, whatever you want to call it, becomes constructive and leads to something more tangible and leads to action. And I think if we see more of that, I think we're going to see more, it's going to be more effective to drive change. Why not just go give the administrative team the what for?
[00:06:22] But I think in practice, there's a lot of structural factors that make that more difficult than it seems. I mean, number one, you have to look at why are the vast majority of physicians employed now? And a part of that is because it's hard to remain independent. It's a lot safer, or at least it's perceived to be safer to be in an employed position. So I'll go be employed, and that's going to allow me to focus on delivering health care. And that's why I got into health care in the first place. That's the reason why you might sell your practice to a private equity firm or go join a hospital.
[00:06:50] You want somebody else to handle the business and administration part of it. I think part of what leads to that frustration is you get there and you realize that's not what's happening. You're not just able to focus on health care like you thought. And so I think we will see the pendulum swing back in the other direction. The problem is those factors that drove consolidation or drove employment in the first place haven't really changed enough that a lot of physicians feel comfortable.
[00:07:16] And that, I think, tamps down your willingness to fight back to a degree because you need to have an alternative in order to have leverage in order to drive change a lot of situations. I think that's lacking right now in health care for physicians. If there aren't alternative places to go work, then you could be up a creek without a paddle if your current employer starts having a problem with you. I wanted to know more about the risks internally to an overly loud doctor.
[00:07:45] So I went back to Dr. Schwartz after this conversation I asked him. He told me, he said, I think there are different threat levels. Obviously, being fired is a big one, but probably that takes the form of not having your contract renewed. Another possibility I think scares docs is the possibility of having privileges revoked or suspended or being subject to disciplinary action that could go on your permanent record. Basically, something you have to report every time you apply for privileges somewhere else.
[00:08:15] It's a potential reputational hit. And that is something most doctors take very seriously, not just because it can impact your ability to get a job, but also because it feels like a commentary on your abilities as a physician. Think of a professional athlete, musician, actor being labeled as difficult to work with, in essence. These things may be more theoretical than common, but they can happen. And that threat is often enough.
[00:08:40] You're talking about the structural constraints that you mentioned that hold back doctors. And some of these structural constraints that we have heard about in earlier shows are, for example, non-competes. Where are you going to go? That's not easy. You spend at least two years and sometimes longer establishing a reputation. You go to a community and you put a lot of time and effort into delivering great care in the community, getting that reputation, establishing a referral base. And then to pick up and move and try to establish that somewhere else, that's a huge ask.
[00:09:10] And it's another part of the inertia. Even if you can get out of a non-compete, you don't have to move. Now you have to reestablish your practice. You have to kind of unwind yourself from the hospital. You probably can't solicit those patients. Maybe you have to join another group. Maybe there isn't another group in town. Or maybe you have to start from scratch. And how do you start from scratch to build a practice outside of that setting? If you've never been outside that setting, if you've always been employed, it can be a scary leap to go in a totally different practice model.
[00:09:36] So these are all the structural things that make it a lot more complicated than it seems to just say, Okay, I'm handing in my resignation and I'm going over here. I'm just going to hang out a shingle and be successful. It doesn't mean you can't do it or shouldn't try to do it. Yeah. And this also came up in the first episode with Yasha Sweetie saying about private equity. Because the same thing happens there. What are you going to do? Leave the health system. If you go over to private equity who did a big roll up and now they rolled up all the practices in the area.
[00:10:03] Now you've got to move your whole family 200 miles away or something. There's not a good piece and there's a lot of risk involved. We're generally risk averse. And so sometimes you stick with the safest path, even though the devil you know is safe than the devil you don't know. And I think there's some inertia there to that safety, even though you're not happy. Dr. Graham Walker wrote this the other day on LinkedIn, link in the show notes.
[00:10:28] But it really layers on to Dr. Schwartz's point here into the why not just give administrators the what for, which actually was the original question. So Dr. Walker wrote, he said, medicine has a strange culture around speaking out publicly. We spend years training physicians to exercise independent judgment, question assumptions and speak up when something is wrong. But when it comes to expressing judgment outside the hospital, we worry about being unprofessional or damaging our careers.
[00:10:59] Meanwhile, a 24-year-old tech founder in San Francisco who never spent a day in healthcare can announce plans to reinvent it and investors celebrate the ambition. Dr. Walker wrote, sometimes I wonder if medicine's deference and humility work against us. Again, I will link to this post in the show notes. But you can definitely see how Dr. Walker's point of view and Dr. Schwartz's are certainly aligned. And I think that worsens the burnout problem because it sort of leads to that feeling of hopelessness of, well, this isn't great.
[00:11:27] I'm not super happy here, but I don't really have any, don't feel like I have any alternatives. And I think that's a really difficult feeling for a lot of physicians. If you're younger, earlier in your career, and you're like, maybe I want to go independent. In the past, there was kind of this apprenticeship, right? Like, there's plenty of independent physician groups that you could go work for and then either work your way up within that group. Or you're like, okay, well, I learned how to do this and now I can go out on my own.
[00:11:53] But if there's not very many independent physician groups out there, then how are you going to learn kind of like the business of standing up a practice, never having worked at an independent doctor's office before? Yeah, so session planning used to be a huge thing in private practice. You bring younger partners in, you teach them the business, you get them involved in the business, you give them literal and figurative ownership in that business.
[00:12:16] And now, you know, we have people retiring earlier and leaving earlier, or there's less traditional private practice out there. How do you bring the younger generation on board, keep them engaged, give them that literal and figurative ownership that's going to allow them to just sort of continue on versus say, you know what, there's no future for me here. I'm just going to go to the hospital and health system.
[00:12:38] It's a lot theoretically cleaner to be employed than it is to go into a practice where 70% of the people are looking to retire in the next three years and just kind of pass the business on to me and get out. So I think it is becoming a lost art, which again, makes things more complicated. You know, we can't just see the next generation as somebody to kind of pass the problems on to.
[00:12:59] We have to help set them up for success and not just see them as a means to facilitate my retirement, but see them as a means to continue and revitalize independent practice going forward. So I'm writing down some of the things that you are saying, Dr. Ben Schwartz, that are foreshadowing here. Hopefully not to hold them against me later. No. Well, they're the light at the end of the tunnel, right?
[00:13:23] So just in case anyone is becoming disheartened by some of the stuff that we're talking about, which is like the why for why this is hard, why this has happened. This is also the reasons, honestly, why like let's just similarly to how we should not be finger pointing employers like it's so easy. It's not actually easy.
[00:13:39] So we're kind of having a conversation about the reasons why this is actually harder than it may seem on paper, despite the impetus to try to fix the system and to be the giant and wake up and take back the ownership and power for what is going on in the healthcare system, which is clearly elsewhere at this moment in time.
[00:14:01] But while we're on the why this is hard portion of this conversation, you know, also many people point to actually to med school where competitiveness is a thing. So you talk about leverage, you kind of have to collectively act at some level. Like if you're just the one lunatic out there in the parking lot picketing all by yourself.
[00:14:25] I think we're probably competitive by nature, just being interested in medicine, becoming a doctor, I think tends to attract a competitive sort of personality. And then from the get go, in order to get into medical school, it's competitive. So you have to be competitive in college to get a position in medical school. Then in medical school, you know, you're competitive on your clinical rotations to stand out and get a good grade. And then you're competitive to get residency spots. And then you get into residency and you're competing with one another, you know, to get fellowship positions.
[00:14:52] And, you know, and then we start to kind of get siloed into our own specialties and your specialty becomes your identity. And so it's hard to get physicians, you know, rowing in the same direction from a kind of a broader perspective. And physicians are a very heterogeneous group in terms of coming from all different walks of life and philosophies about, you know, politics and social issues and Medicare for all and all this kind of stuff. You know, we're not homologized and we shouldn't be.
[00:15:19] But how do we kind of put some of those differences apart and realize that we're all facing kind of high level issues that affect all of us? Right. And some people, some physicians may be losing more or less than others, but we're all kind of losing at the end of the day. And the system is also structurally set up to piss against one another. That when you look at budget neutrality and say, hey, we have this one pool of money to pay physicians, that pool's not getting any bigger. So, yes, we want to pay primary care doctors more.
[00:15:47] But in order to do that, somebody else has to lose because it's a zero sum game. And so structurally, we're pitted against one another when it comes to reimbursement. And so there's a lot of different factors that kind of keep us from pulling in the same direction. It's also how do you work as a team? I don't think there's very many like management training classes in any given med school. There's just an episode with Dr. Rebecca Andrews about team-based care. And it's definitely, it's not just like throw a bunch of people in a room and hope that it goes well.
[00:16:16] It's a thing to be able to work collaboratively, not only across doctors, but also with everybody else in the organization. There's a lot of things that we could change about medical training in medical school and residency. I don't think we do a great job of sort of preparing doctors to actually go out and practice medicine, not just from the clinical standpoint, but also what is it like to exist within the healthcare system? What's going on in the healthcare system? How do you understand the business of medicine?
[00:16:45] How do you understand what's changing and how to adapt to those changes? We tend to be kind of tunnel vision on take care of the patient, which is what it should be ideally, but that's not the reality that we live in. And to our detriment, I think it's kind of cost us the seat at the table. I was just at a conference, the American College of Surgeons, clinical Congress conference on a panel. And one of the docs came up to me, he's interested in the stuff. He's at an academic medical center. And he's like, well, I'm interested in it, but I can't get any of my partners interested in it.
[00:17:14] They're totally oblivious to this stuff. They have zero level of interest in it. How do I get them to understand that? And I think that's something that we can do better to educate other doctors on, hey, this is what's going on around us. And you have to understand it, get involved a little bit to support the people that are doing this work to advocate and to drive change. But we all can't be oblivious. We have to understand that this is going on and it's slow and it's death by a thousand cuts. And I think that's why it happens.
[00:17:42] We've been oblivious to it and why we kind of wake up 20 years later and realize how much autonomy has been eroded, how much reimbursement has been eroded, how many of us are now employed. I'm going to oversimplify because I think you said this very well. Currently in physician training and maybe the way that a lot of physicians think about it, they think about the one patient in front of them and how do I best take care of the one patient in front of them or how do I take care of my patient panel?
[00:18:06] And we have very few, listen to the first show with Dr. Suhas Gandhi about how many physicians are actually on the boards of hospitals, right? It's a shockingly small number. And if there's not doctors up at that leadership level, it all sort of trickles down in a kind of suboptimal way at the bedside. Yeah, I think it's at the leadership level and there's certainly doctors at the leadership level in different payers, health systems, what have you.
[00:18:33] I think the question is, and another kind of area of friction and where we don't get along is oftentimes once you cross that chasm, you know, the MD suddenly means something different and you're not seen as a colleague anymore. You're just kind of seen as the enemy. And in some cases, maybe that's fair. In some cases, it's not fair necessarily.
[00:18:54] But if we're going to put physicians in leadership positions, Congress, you know, payers, health systems, whatever it is, you know, how do we maintain that connection with sort of the broader medical community and not label that person as the enemy? And how can that person keep in contact with the rest of the medical community and sort of, you know, be seen as somebody that can bridge that gap between those two worlds rather than somebody that sort of left that behind and now has a different set of incentives that are not aligned with their physician colleagues?
[00:19:24] I feel like we've pivoted. Thank goodness. From the doom scroll portion of this conversation to the, all right, now how do we fix this portion of the conversation? So our first kind of piece of advice here is how do you do dyad leadership? Let's just call it that. In a really, in a way such that the clinical leaders who are upstairs have that connectivity with the bedside.
[00:19:51] You said something the last time, which really stuck with me, that there's a very, very, it's a very different view, one foot from the bedside than 10,000 feet from the bedside. How do we ensure that they don't wind up just kind of getting sucked into those palatial C-suites and then wind up kind of losing the role that they were supposed to have? Yeah, and it's not easy. It's not easy to bridge those two worlds because they each have their kind of, you know, challenges and they each have their expectations and they're both valid, right?
[00:20:20] But if you have somebody that's trying to, you know, bridge both of those gaps and understand both of those things, you know, hopefully having lived it on the clinical side and bringing some of that to the administrative side. But at the same time, you do have different incentives and you do have different pressures and it's hard to walk that line and not have one side feel like you're favoring the other side. It's not an easy thing. I think it's about garnering trust with the clinicians because you have that experience.
[00:20:43] You can speak that language and you can have their best interest in mind, but at the same time, you know, dot just blanket agree to everything that they say and automatically assume they're always right because you came from that world. But help them understand. Yes, I understand this doesn't make sense from the clinical perspective, but here's why we have to think this way from maybe more administrative perspective. We say that value-based care too, right?
[00:21:04] Of, you know, yes, in some ways this feels like, you know, driving clinical decisions from a non-clinical standpoint, but at the same time, there's a good reason behind it and be able to justify that and be able to, you know, bring evidence and data, be able to speak a language and say, this is why we're doing it the way that we are. It's not driving a clinical decision. It's just trying to deal with the best for the patient in the best way, the most cost-effective way. So let's consider that our first piece of advice.
[00:21:31] Let's be deliberate about how we are leading, making sure that there are physicians in leadership roles, doing the diard leadership and doing it correctly. The second thing is, and you had alluded to this earlier, this is what I wrote down, figure out how to come up with new models that are possible even in the healthcare industry that we currently have. Yeah, there's a lot of attention now on corporate process of medicine.
[00:21:57] And so I think a lot of people feel that the next version of independent healthcare is probably not going to be smaller practices. Do listen to episode 529 with Dr. Eric Bricker, where we talk about how much more consolidated health systems can manage to get paid for the same services as independent practice. Link in the show notes. I will also link to a recent post by Christopher Habig on this exact point.
[00:22:26] It's hard to remain independent and be successful. And so there's this idea of strength in numbers, economies of scale, which I think are beneficial if implemented properly with physician leadership. So MSOs kind of are controversial in terms of this management structure. And can you aggregate doctors together in numbers to get the benefits of an MSO structure without some of those sort of extractive things that we've seen in some of the investor backed MSOs?
[00:22:55] And I think the answer to that is, yes, it's challenging to do it because you have to get, again, physicians rowing in the same direction. There's governance issues and bringing doctors under one roof. But I think these newer models sort of walk that fine line of independence, but also kind of consolidating physicians together, but maintain that physician governance and leadership and not have somebody else with an ulterior motive kind of running it. So MSO, managed services organizations.
[00:23:24] And what we've got going on there is that somebody is managing the services, not necessarily like within the physician group. And there's two ways that there's two structures there. One of them is that it is owned by private equity, owns that managed services organization. And then the other one is that it is a physician led organization. The concept itself is neither positive or negative. It's really in the implementation of it.
[00:23:48] And so if you have somebody that's giving those management services, they're taking a management fee and they're providing capital, but they're also, you know, they have equity and they're looking for an exit over a timeline, you know, then it tends to be less successful. Or then kind of the structure is a bit different as opposed to look, there's physicians leading it, there's physicians owning it. They're not looking to sell this to somebody else. They're not on some timeline.
[00:24:13] They're just looking to develop, stand up something that takes some of that business pressure off of the physicians, allows them to practice medicine the way that they want to focus on practicing medicine, but take some of that administrative burden, that business management burden off of them, but in sort of a non-extractive way or in a way that's not looking to eventually sell you to somebody else. Andrew Tsang said this very crisply.
[00:24:38] How you get paid fairly in this current healthcare industry is you have to have leverage. And how you have leverage is you have numbers. You have bigger numbers negotiating on your side of the table. And so you can really see that there's definitely a structural impetus to gang up. But there's two different ways that you can gang up. One is with an MSO. That is all the things that you just said. It's probably physician-led.
[00:25:03] The goal is to support the physicians that are part of that MSO. And then there's this other model, which is pretty extractive. If you go online, you can listen to a lot of very sad stories of doctors who sold their practices being promised a second bite of the apple and then never got it. And it's just not good. So there's sharks that are swimming in these waters. If you're going to do the MSO route, just make sure you thoroughly investigate. Yeah.
[00:25:32] Like I said, I think the concept has merit. It's really in the implementation of the concept. Another thing that has come up is ASCs, ambulatory surgical centers. What's your... You know a lot about this one. Yeah. For sure in orthopedics, it seems to be working. I mean, for hip and knee replacement surgeons because of the cuts that we're facing, I think most people feel at this point that if you want to have any hope of maintaining
[00:25:58] independence, that you have to have some ownership in a surgery center that's doing some of these higher acuity cases and getting a distribution from that center for to offset some of the declining reimbursement. More and more care is shifting to the ASC setting. The regulations are supporting that. CMS is getting rid of the inpatient only list. They're adding more procedures to the ASC appropriateness list. They're really putting it on physicians to determine who's appropriate for the ASC and who's not appropriate for the ASC.
[00:26:26] And so I think that is becoming a means of maintaining independence. And it's not just for orthopedic surgeons or total joint surgeons. It's for other specialists that can do procedures in an ASC outpatient setting. And that's becoming a larger and larger number of procedures. And it's good for the system. I think they're lower costs, sites of service. They, the studies show they deliver equal outcomes, safe care.
[00:26:51] Talk to me about direct contracting, which just continuing my track record, my streak of making sure direct contracting comes up in every single Rent-Lens Health Value episode. As a way forward here, what do you think about direct contracting between the two sleeping giants? Right? Like you've got the employers on the one side who are waking up to awake giants, maybe. And then physicians who are like, wait a second, the middle is so messy that if I just contract
[00:27:18] directly with the employers, we can work together. Yeah, the middle is messy. It's expensive. It's complicated. It adds that administrative burden. So I think everyone that is interested in this type of thing, and I'm sure most of the people that listen to this podcast are bullish on direct contracting. And we talk about it a lot, and I think it's been successful in pockets because it does remove that middle layer. It allows for that direct relationship between the person delivering the care and more or less
[00:27:47] the person receiving the care, or at least somebody that has the incentives that should be aligned with the person receiving the care. And so I think there's a lot of potential there. I think it will be, in a lot of ways, the next frontier for independent practices as a way to kind of stave off some of the administrative complexity and declining reimbursement that we're seeing in the traditional system, to go direct to employer, negotiate fairly for the cost or the value of what you're doing and do it in a way that the contracting can be more straightforward.
[00:28:17] I think that the key is to build up the supply side and the demand side and to make sure that the volumes are there to support it, to make it something that realizes that potential. Yeah, and that's a big... We had Dr. Steve Schutzer on the podcast. He's an orthopedic surgeon. He spent all this time and effort standing up a rather large practice that could take direct contracts, could not get any employers to buy it. Yeah, that's a common thing.
[00:28:43] I spent some time working on that in a prior position as well. And we loved those patients. I think the patients loved us too. I think the employers loved us. But it's complicated. Employers are fragmented. You might have 100 employees here, 100 employees there. And how do you bring those things together to make it worthwhile for everybody and have those conversations? I think we're still trying to figure out. I said something the other day about just how there's a lot more resources that are available to help
[00:29:11] self-insured employers do direct contracting. Dean Jargo made a funny comment about this on LinkedIn. He underlined it and he said, yes, there are. Whenever you have a two-sided market, it's always this like someone's always ahead of the other in any given. And it's also local. It's very local. Yeah, necessity is another dimension. And obviously, we know that healthcare costs, insurance costs for employers have, you know, again, for the fifth, tenth, whatever consecutive years reached the breaking point.
[00:29:40] But it does feel like it truly has become the breaking point. And same thing on the, you know, the supplier side for physicians of, okay, there doesn't seem to be a viable path forward anytime soon for me to really reverse the declining reimbursement. But here is a pathway where I could probably negotiate with somebody because you really don't negotiate with CMS and it's very hard to negotiate with a commercial insurance company. Easier in theory to negotiate with employers motivated.
[00:30:07] And I can say from the physician standpoint, used to go to orthopedic meetings even three or four years ago, and this wasn't on anybody's radar screen. Now you go to meetings and there's at least several sessions on it. And there are people that are doing it well and have set it up well and put the time and effort in and have success doing it. Going back to the competitiveness and the FOMO of, hey, somebody is doing this, they're successful, and they can present that. Then it gets me thinking, well, why am I not doing that? Same thing, same pressure that makes you go start doing robotic
[00:30:34] surgery is going to make you more open to direct contracting and working with employers and not just dismissing it as something that's not worthwhile because it's a tiny book of business. You put the effort in to make it a bigger book of business. I never thought I would hear FOMO and direct contracting in the same sentence, but welcome to Relentless Health Value. So the last maybe way forward here, and I'm going to say this
[00:31:01] carefully, is collective action with physicians. Maybe think about how you're going to work together, band together, and gain leverage within the existing model. And there's been a lot of talk about unionization. I think there was for the very first time in the Twin Cities, there's a doctor walkout, which was a big deal. But as you contemplate what the potential is, or the not maybe or the watchouts for collective action amongst physicians, what are you thinking?
[00:31:31] Yeah, I think it's about, again, trying to put aside your differences as much as you can to realize that we're all facing the same structural issues to some degree, maybe different degrees, maybe in different ways. But we have sort of this overarching lack of autonomy, declining reimbursement, increasing administrative burden, feeling of burnout, that affects all of us. And coming together, however you want to define it, I think we have to do that. If we don't do that,
[00:32:00] we're going to continue to stay fragmented. It's going to be very easy to continue to push us to the margins or to not give us a seat at the table. Because at the end of the day, it comes down to leverage and strength in numbers. So maybe it's unions, maybe it's some sort of organization that physicians can actually get behind and support and put aside their differences enough to realize, again, we don't have to agree on everything. And we all have our own challenges. But we also all have challenges that are common to all of us that would be beneficial for us to be able to figure out a way
[00:32:30] to work together on those things. I am encouraged to hear what the ways forward are. There was a bunch that you listed. You got to start kind of nudging the giant. And I think from the physician standpoint, that is the simplest thing is just educate yourself, understand what's going on, take an interest in it. And that's how you start. And then you go from there. And not everybody needs to go to DC and lobby.
[00:32:54] And not everybody needs to get an MBA and try to become an MD MBA administrator. But I think just educating yourself on what's going on around you is the first step. And sharing podcasts like Relentless Health and Value or keeping your ear to the ground is the first step. Knowledge is power. I love how you said that. It's knowledge is power. Awareness is power.
[00:33:17] Trying to figure out how to work together and advance toward a better future. Unfortunately, the reality is it's not enough anymore to just think that being a doctor is head down practicing clinical medicine. It's also being aware of what's going on around you and getting involved in some degree or at least being educated in some degree. As Dr. Bricker said relative to employers, no one is coming to save us.
[00:33:43] Like no one is coming to save us. So if anything's going to happen here, it needs to be the individuals who desire change picking up a torch. We've proven in other areas of our lives that when we put our minds to it, you know, we can do difficult things. We just need to put our mind to doing this difficult thing. Is there anything I neglected to ask you that you would like to mention here, Dr. Ben Schwartz? I feel like our conversations are always stream of consciousness, which is great because I think
[00:34:11] there's always more questions than answers. But thinking about these things, I think is important. And so I don't think you always have to have the answers, but I think you do have to think about them. If someone is interested in learning more about either your work or your excellent sub stack or your post on LinkedIn, where can they find you? Yeah, come to LinkedIn or the surgeon's record is the name of the sub stack. Thank you so much for being on Relentless Health Value today. My pleasure once again.
[00:34:40] Hi, I'm Alex Summers, physician and founder of Estia Health. What I appreciate about Relentless Health Value is that it doesn't simply talk about what's wrong with healthcare. It brings together people who are doing the hard work of fixing it. The conversations are honest, practical, and focused on creating better outcomes and greater value for patients and employers. It's a resource I regularly recommend to others working to transform healthcare. I highly recommend signing up for the weekly newsletter. It's a great resource because it includes all the links mentioned in the show,
[00:35:09] plus a full transcription of Stacey's intro. Please be sure to follow the podcast on Apple Podcasts or Spotify and forward this episode to someone who should be listening.