It’s crazy how timing works. On the heels of our #Q4LiveTampa conference where we spent a few days learning, debating, and planning how to bring solutions to the failing healthcare system, comes the announcement that Jeff Bezos (Amazon), Warren Buffett (Berkshire Hathaway), and Jamie Dimon (JPMChase) have teamed together to do just the same.
My first thought was how could these three guys possibly match the impact of our room full of passionate people?!
Okay, maybe that wasn’t my first thought. My first thought was more along the lines of, “Holy crap, this is going to accelerate everything we just discussed to a pace we couldn’t even imagine as recently as last week!”
The collective, personal, net worth of these three guys is $210.01 BILLION! Together, their three companies employ 1,152,955 people. They represent some of the greatest minds and innovators our generation has seen. Their influence is beyond comprehension.
The thought of what they could accomplish from an investment and technology perspective to help fix healthcare makes me a bit giddy. However, despite the size of the gloves they just laced up, it is a BIG ring they are stepping into.
Who are we fighting?
Their first opponent appears to be a Congress motivated to protect the status quo. As Dave Chase observed at our recent conference, 80% of politicians are preservationists. The second opponent is a collective, and sizable, lobbying effort committed to financially rewarding that same preservationist position.
According to OpenSecrets.org, the collective lobbying spend for several very interested industries in 2017:
- Pharmaceuticals/health products - $277,784,999
- Insurance - $160,235,585
- Hospitals / Nursing homes - $99,630,303
- Health professionals - $89,539,171
- Health services / HMOs - $80,740,374
That’s a single year total of $707,930,432 in lobbying spend! Sure, insurance likely includes non-medical spend, but I am certain there are other lobbying efforts not captured here that more than offset whatever amount that may represent.
And, to give you an idea of the trajectory for which these efforts are moving, according to the same website, the Pharmaceutical/Health Products lobbying effort alone has grown from $90,675,603 in 1999 to $277,784,999 in 2017.
That’s a lot of motivation to protect the status quo. And, sure, the collective personal net worth of Messrs. Bezos, Buffett, and Dimon (B|B|D) make this lobbying effort look like pocket change (how crazy is that?!), but I’m not sure that is even the real issue.
As Chase also observed at our little gathering, “The answers to healthcare won’t come from Washington, D.C., they’ll come from you and me.” It's a long shot to say this trio represents "you and me", but they are definitely NOT D.C. And, since the answers won’t come from there, I also choose to believe this means D.C. can’t keep those answers from happening.
Weapons of choice
The potential this trio brings is certainly beyond my pay grade to fully understand. However, I am certain they bring two significant weapons to the fight: magnification and amplification.
In his book, “CEO’s Guide to Restoring the American Dream”, Chase does a great job of dissecting the level to which our healthcare system has deteriorated, but he does an equally effective job of identifying where the fixes are already in place, and have been for years. I've said several times that his book will leave readers with a renewed sense of optimism for what the healthcare system can be, but not before getting pissed off about what it has become.
Just a couple examples, according to CEO’s Guide, of what is broken.
- If nothing changes, $1 out of every $2 earned by millennials will go into the healthcare system.
- Pharmaceutical companies are securing formulary status for drugs that sell for $4,000 for a ninety-day supply and are nothing more than the combination of a couple of common drugs likely already in your medicine cabinet.
- Insurance companies actually benefit when healthcare costs go up and even when they process fraudulent and/or duplicate claims.
- U.S. companies are operating at a 9% cost disadvantage internationally because of our broken system.
But, also according to CEO’s Guide, here are a couple examples of fixes that are already in place.
- Pittsburgh schools are paying $4,661 per member per year compared to the cross-state Philadelphia schools that are paying $8,815. As a result, class sizes in Pittsburgh are 30% smaller, teachers are paid better, and there are four times as many librarians.
- Rosen Hotel & Resorts, one of the most forward thinking employers in regards to healthcare seen by Chase, has enjoyed $315 million in savings on healthcare costs since 1971 and spends 50% less per capita than the average employer.
- Enovation Controls, a 600 life manufacturer in Oklahoma, has saved $4,000 per covered life by working with a transparent medical market.
And these fixes are just the start. We heard countless examples at our conference of how everyday advisors are putting everyday solutions in place for their everyday clients.
How exciting is this?! The solutions exist, its simply time to scale them!
Calling Dr. Welby
The solutions aren’t necessarily complex nor do they necessarily require immense amounts of capital or innovation. For the most part, they are common sense and more “back to the future” than some “next-generation” idea. As Steve Heger, one of our member agency principals, noted after our conference, “I can already see myself telling employee groups, ‘We’re going back to Marcus Welby, MD!’”
If B|B|D can do anything, through the media attention they will garner, it will be to put a magnifying glass on the disgusting and arguably criminal activity that has become so engrained in the system. As these examples become more clear and widely understood, I predict the American people will reach a fevered pitch of anger.
The other side of B|B|D’s ability is to provide amplification to the countless success stories that other, much smaller organizations have been enjoying for years. With clear, common sense examples to follow, I predict the American people will also reach a fevered pitch of optimism.
If the trio does nothing more than magnify and amplify, their initiative will be beyond significant. Add in the additional elements they can offer that most can't even imagine such as technology, innovation, investment, etc., and it becomes unbelievably exciting.
Here is where you come in
Now we need to build and rally a force of advisors to carry this message forward and provide the implementation plan employers will need to execute within their own organizations.
The B|B|D effort is going to keep this topic in our collective awareness for the foreseeable future. However, it is going to be difficult for most employers to relate to this trio and their respective companies. It will be easy to discount the ideas as not applicable to “someone of my size”.
It’s up to you, the benefits advisor, to help individual employers understand where they fit in. You need to help them understand how they are impacted by what is broken and, more importantly, how they can take control of their own future and enjoy the already proven solutions.
It’s up to you to provide the education, communication, and collaboration necessary to scale the fix. It’s up to you to be the architects of actionable plans on behalf of your clients.
While the B|B|D trio will deliver major blows, it will be the collective blows of an army of advisors and their employer clients that will ultimately bring the beast to its knees.
Are you ready to lace up your gloves? Are you ready to step into the ring? Are you ready to help your clients do the same?
If you’re not sure of how, allow us to be one of your guides. We don’t pretend to have all the answers, but we are committed to identifying those who do and to sharing their ideas at every opportunity.
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