← Becker’s Healthcare Podcast
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- [00:00]
A
Hi, everyone. This is Elizabeth Caslo with the Becker's Payer Issues podcast. I'm thrilled today to be joined by Kevin Knight, Chief Marketing Officer at Sidecar Health. Kevin, thank you so much for joining us today.
- [00:11]
B
Thank you, Liz.
- [00:13]
A
Yeah. So before we jump into the conversation, can you tell me a bit more about yourself and your career background and transition into the health insurance space, as well as your current role at Sidecar?
- [00:24]
B
Sure. I spent my career mainly in consumer technology. I've worked at companies like, like Google, Microsoft, Facebook, Pinterest, Compass. And at one point a few years ago, I sort of found myself in this moment of introspection, wondering if maybe I could take the really useful skills that I had picked up in those roles and apply them to something that would have maybe a little bit more impact than, you know, cell phones and social media and things like that. As interesting as that time and that era was, and I really found myself gravitating toward health care because I'd worked for companies like the ones I mentioned that were all really, really audacious. They had massive ambitions, and they fully believed that they could change consumer behavior and change the way that people interacted with ideas and content and one another. And they're just. There's. There's always been this persistent dearth of, I would say, audacious ideas in health care. And so I began my own journey in healthcare working for a point solution called Vita Health about six or seven years ago as chief marketing officer there. And what I found is that so many of these companies that are really interesting ideas, like so many of the point solutions out there, they really exist because of a failure of coverage on the part of carriers. And so over time, I found myself gravitating more and more toward, if I really want to be part of fixing American healthcare, let's go straight into the belly of the beast and let's try and fix health insurance, because that is ground zero for so much of what is wrong with American health care.
- [02:02]
A
So given all of that, you know, I think it's clear that marketing for health insurance can be a challenge. So what messaging is landing right now for the people that you are serving and what's falling flat?
- [02:16]
B
It's a great question. I think that what, What. When it comes to consumers, patients, members, people, humans, whatever we want to call them, it's the jargon, it's the lingo, the nonsensical rules and red tape and bureaucracy that people really get lost in the fact that we call explanations of benefits something that they really are not. I mean, who gets an explanation of benefits and is left with any feeling other than confusion, they utterly fail to deliver on what they're called. And that's true of just about every piece of jargon in health insurance. So the longer I've spent in this space, the more I have found that while we who work in the industry have this sense that the way things work is well entrenched and people understand them because it's been this way for so long, the reality is most, most Americans don't understand health insurance. They don't understand how to navigate health care. And the more we can make health care in America work the way everything else we do works, the more intuitive it becomes. And the more we try to solve our cost challenges and coverage challenges and access challenges with new rules and regulations and hoops to jump through that are unique to health insurance, the more we just add to the confused state that most Americans already find themselves in.
- [03:48]
A
So I wanted to talk about that jargon point a bit more for our listeners in recent. A little while ago, Kevin posted on LinkedIn saying the words we use internally show up externally. If you call burgers products internally, you're bound to call them that externally at some point. How do you simplify and de jargon these complex terms that often come up in health insurance? For example, like ichra, like that's. That can be kind of tricky sometimes for employers and employees. So I would love to hear about how you go about that.
- [04:17]
B
Yeah. And of course, so many of these things are really, you know, born out of legislation and things like that. Boy, what, what a reminder that the things you write on LinkedIn can be discovered anytime and come back to you. So that was a fun trip down memory lane. You know, I think it gets back to the, the core point that I would make is that what we have to do is we have to make health care work more like everything else in people's lives and not continue to convolute it and complicate it. So, you know, maybe just give a little bit of background, because I'll probably, you know, refer to these concepts over and over again during the course of our discussion. But when the sidecar health model just for people's background is oriented around this concept of let's just get people to treat healthcare dollars like their own. If we could get people to spend, to shop responsibly for healthcare services, that in and of itself would be a massive cost control, the same way it is in cars and groceries and vacations and airline tickets and hotels and all these Other fairly expensive and fairly high consideration things are that we buy. But of course that only works if we can make health care accessible, transparent, shoppable. And so these are concepts that I'll come back to, you know, time and again, I'm sure, during the course of our conversation, but because I think they lie at the core of the only sustainable scalable solution we could ever arrive at with health insurance. So if in the case of an ichra, for example, or an hsa, both of these are just fancy, you know, I'll admit jargony terms of basically the same concept, HSAs, which by the way, were the last bipartisan health reform we had in this country, because the ACA itself was not particularly bipartisan at all. But you did actually have people crossing the aisle in meaningful numbers to vote for or against HSAs back in 2003. But HSAs is basically a fancy way of saying we want people to spend healthcare dollars like their own. In fact, if they do a good enough job of shopping and, you know, or, or, and also have some health luck and don't need expensive care and they have money left over at the end of the year, we're going to let them keep it. It's really going to be their own. ICHRAs are basically saying instead of having a one size fits all health solution health plan for everybody in the company, let's let them go buy care on or buy coverage on the exchange. And so in general, I think we just need to be talking about these things the way they work and not, you know, slapping these labels on them. But we do need to make sure that getting healthcare works the same way that buying everything else in this country does.
- [07:07]
A
Yeah. So I think it was interesting that you brought up HSAs just now because I know there's been a lot of talk at the federal level about giving ACA dollars back to consumers. I think it's kind of been unclear as to what that might look like in practice. But what do you think that would look like? Would it be an hsa? Like, what do you think the next step could be if that were to gain momentum?
- [07:31]
B
Well, you know what's interesting is HSAs are a great idea, right? Like I said, people on both sides of the aisle agreed that they were a great idea more than 20 years ago, but they have not taken hold as quickly as I'm sure most people who advocated for them 20 plus years ago would have hoped. But I saw some interesting data from the founder and CEO of a virtual healthcare company on LinkedIn the other day. This is Michelle Davy from Wheel, and she was talking about the fact that they are seeing enormous growth in their services, but it's mainly coming from people who are just paying out of pocket, basically through HSAs. And one of the points that she made here is that there is so much direct to consumer healthcare available today. So you think of all of the weight loss solutions, all of the hair loss solutions, all of the functional medicine solutions, all of the lab work, Amazon, there's, there's just lots of these providers that are going direct to consumer today with transparent pricing. And so a lot of people who before were not on HSAs are looking at saying, well, I can use HSA dollars for that and I know what they're going to cost. And so it has provided this real gust of wind in the sails of HSAs. So the thing that's been holding HSAs back is, is the simple fact that while the theory and the concept is nice that people can treat health care dollars like their own, if they cannot easily access price information, quality information, the types of data points that people use in making decisions for buying anything from shampoo to a new car, then how are they going to be able to effectively use an hsa? But the more we move towards shoppable health care, the more HSAs become a really interesting solution. And, and here you're seeing that direct to consumer health providers are basically leapfrogging everybody you know who's an incumbent, like the big health systems and things like that. But there is nothing systemically preventing us from publishing the prices of every service that every healthcare provider offers, except for enormous resistance from the incumbents, who stands to gain everything from the persistence of our broken system.
- [10:08]
A
What do you think would it take to shake that up?
- [10:13]
B
Competition. Competition is what tends to shake everything up. If you look at competition and sometimes technology. But if you look at so many of these industries where people bemoan the costs, but then ultimately have to kind of shrug and pay, because what other option is there? Look at long distance phone calls back, you know, 30 years ago, I grew up overseas and every Sunday night we would call my grandparents and talk to them for about 20 minutes. That was a budget item. In my family growing up, the long distance, grandma, grandpa, phone calls were expensive. Now they're free, right? And it is the result of technology and also competition. If we look at healthcare and let's talk about coverage specifically here, because that's the space I'm focused on right now, the technology is there, right? Everyone's got a phone on them, a smartphone, they can have an app. There's nothing technologically preventing people from, from popping up a location assisted app and saying I'm looking for an MRI on my knee. What's it going to cost anywhere around me? All that technology is there. What has historically not been. There is competition and that's what we need. We need more competition. We need to have the courage to explore new models and that will lead to improvement in, in the health care and health insurance industry the same way it has with every other industry.
- [11:47]
A
So I know you said HSAs may not have gained the traction at the rate that people were initially expecting. So realistically what do you think? And this is more broad than you know, an hsa, but what do you think employer sponsored insurance will look like in like three years? If we give it that timeline? If what Sidecar believes in plays out pragmatically, like what do you think will actually happen in three years?
- [12:12]
B
Yeah. So the average net margin of a Fortune 500 company is 8 or 9%. If health care costs continue to rise for these jumbo self insured companies the way that they have been the last year or two, which is a steepening of the curve of the last 20 years, these companies are facing a very real decision, which is basically what you just said. What are they going to do? On the one hand they can accept their fate, which is they will no longer be in whatever business they are in today. They will instead be in the business of providing healthcare coverage to people who work for the company, but their not going to have the resources to be able to invest in R D and new hiring and expansion and things like that because they just, with those kinds of margins, you just can't fund healthcare coverage in its current incarnation without basically sacrificing everything that is strategically important to your business. Or on the other hand they can completely upend this and say, you know what, what's, what we've been doing for the last 20, 30, 40 years has not been working. It has utterly failed to control costs, which is the primary job of employer sponsored health insurance, of course. Well, I guess the primary job obviously is to take care of the employees in their time of need, but it has to do so in a, in a cost controlled way. So we have to try something new. And what's encouraging here is that so many employers are willing to do that. It's, it's, it's, it almost makes my job very easy in the sense that almost anybody is up for a conversation on how they can materially lower their, their healthcare costs and the reason for that is, healthcare costs have finally gotten so expensive that people are being forced to explore alternatives. If you'll indulge me in another federal policy example, I think of this as being very parallel to what happened in the 1980s when my dad graduated from college and took his job, which he had for 40 years and only recently retired. He had a pension. Today, almost nobody has a pension, right? There's nobody coming out of college today who's really expecting a pension. Well, what happened in the 80s? Pensions became too expensive. Just full stop, it was too expensive. And so what we did is we came up with all these new sort of, all right, well, we've got to put people in charge of their own money. Basically, 401ks replace pensions. And today, in fact, if you look at basically a 20, 30 year time frame, in about 20 or 30 years, it you went from almost every company offering a pension to almost every company offering a 401k. And today, obviously almost everyone offers a 401k. And what do 401ks do? They put people in charge of their own money. So I think there's something very much to this idea that does come from places on both sides of the political spectrum of we've got to get consumers engaged in their own healthcare, in even maybe putting them in charge of their own money. But I appreciate that it's scary to do something different, but we have to take courage in the fact that it is way scarier to do nothing because these costs are completely unsustainable.
- [15:33]
A
Do you have any final thoughts for industry leaders? I know you said it kind of can be segmented into the smaller players and then the more legacy players. So what thoughts do you have speaking to that audience?
- [15:47]
B
Well, employers are very often the leaders of change in this country. In fact, for a long time, mental health was not really treated as health. In fact, it's still not covered adequately by most health plans. But in the days leading up to, and certainly the darkest days of COVID you saw American businesses rally around their employees and say, you know what? Mental health is health. And there was enormous investment in people's mental health in a way that I think is refreshing. And everybody is grateful to employers for taking the lead on this. This is an example too. This is a moment of time where there will be a separation of the leaders from the pack. There will be some employers who say we have to look at something completely different. We have to look at different models that can preserve coverage, maybe even offer better coverage, as is the case with sidecar health. But we'll do so with a model that can sustainably bring costs down. And there will be others who will be very afraid to make any change. But this is that moment of truth. This is that opportunity for those who raise their hand around pensions and migrating, you know, to 401ks and things like that, or paying for therapy or taking care of their employees. Mental health people who have that view of leadership and see themselves as problem solvers, now is their time to show that there are other ways. And I'm very encouraged. Every time I talk to a company, whether it's somebody from a 200 person manufacturing plant in Georgia to some of the biggest companies in the world, I see a lot of people who are saying, you know what, now is the time to look at something different. And so I think to come back to your question from a moment ago, three years from now, I think we are absolutely going to be astonished at how quickly we went from a it's got to be this traditional legacy network based approach to, you know, there will be at least one or two other models that are pretty dominant in the space. And the one thing they'll have in common is that they will put employees in a place where they are entrusted and empowered to treat healthcare dollars like their own and shop for healthcare.
- [18:16]
A
Well, Kevin, thank you so much for this conversation. I really enjoyed it.
- [18:20]
B
Likewise. Thank you, Liz.
- [18:21]
A
And to our listeners, if you'd like to listen to more podcasts from Becker's Healthcare, you can visit Beckershospitalreview.com thank you.