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Alex Shteynshlyuger, a urologist with a observe in New York City, feels surrounded by UnitedHealth Group. He has seen the corporate gobble up non-public practices and says it’s sluggish to pay claims. It additionally began providing cash-flow providers that, Shteynshlyuger says, really feel rather a lot like payday loans.
UnitedHealth Group is the largest employer of physicians within the United States. And it’s rising.
Has the corporate develop into too huge?
In this episode of “An Arm and a Leg,” host Dan Weissmann seems into this “behemoth” firm and the obstacles antitrust regulators face in maintaining with its speedy progress.
Dan Weissmann
Host and producer of “An Arm and a Leg.” Previously, Dan was a workers reporter for Marketplace and Chicago’s WBEZ. His work additionally seems on All Things Considered, Marketplace, the BBC, 99 Percent Invisible, and Reveal, from the Center for Investigative Reporting.
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Emily Pisacreta
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Transcript: A ‘Payday Loan’ From a Health Care Behemoth
Note: “An Arm and a Leg” makes use of speech-recognition software program to generate transcripts, which can comprise errors. Please use the transcript as a software however test the corresponding audio earlier than quoting the podcast.
Dan: Hey there–
Last month, I noticed a wild tweet from a physician in New York — and plenty of different individuals noticed it too. It made the rounds.
It mentioned that Optum — a subsidiary of UnitedHealth Group, higher identified for operating the massive insurance coverage firm UnitedHealthcare– quote, “is now running a payday loan business targeting medical practices.”
This physician wrote that United “denies and delays” funds to docs– in different phrases, hurting their money move, making them targets for a “payday loan business.”
One factor checked out immediately: Optum is providing loans to medical doctors and different suppliers, at curiosity. And the pitch is money move.
Voiceover: Optum Pay Advance is constructed for healthcare organizations like yours. We’ve developed a personalized money move answer that provides straightforward and quick entry to funds.
Dan: The web site offers an instance the place a $100 “loan” means $65 to you upfront, and them holding $35.
The doc who tweeted it known as the thought “Genius!,” exclamation level.
You know, genius like in “evil genius.” It seemed like my boss telling me:
“Hey, Dan. Payday’s Friday. And I’ve got bad news and good news. The bad news is, I’m not gonna pay you Friday. I’m gonna do a deep dive on your timesheet, and I may ask you for a bunch of supporting paperwork. Honestly, I don’t know how long it’ll take, or how much I’m actually going to pay you. So, you know, that’s the bad news. The good news is: I can front you some of the money. I’ll just take it out of any future paychecks, plus a little something for my trouble. Say, 35 percent?”
I talked with the physician who posted the tweet: Alex Shteynshlyuger, a urologist in New York.
Dr. Alex Shteynshlyuger: So that’s an unimaginable marketing strategy. You should be… actually artistic, to provide you with that enterprise thought. You additionally should have metal balls to really suggest that publicly. I imply, you must not have any ethical compass in any respect.
Dan: Now, having appeared into it, I’ve gotta say: It will not be EXACTLY that easy. UnitedHealth Group operates an enormous internet of well being care enterprises, not simply insurance coverage. These “payday loans” are in a distinct a part of the online from the insurance coverage aspect.
But that seems to be the story: The dimension and complexity of that internet — the way in which it surrounds medical doctors like Alex Shteynshlyuger, the way in which it retains getting tighter, round all of us, and what that appears to price us– that’s the story right here. UnitedHealth Group just isn’t the one firm weaving an enormous internet, nevertheless it seems they’re the most important.
And, so far as I do know, they’re the one ones providing payday loans to docs. So let’s make them our case research.
This is An Arm and a Leg, a present about why well being care prices so freaking a lot, and what we will possibly do about it. I’m Dan Weissmann. I’m a reporter, and I like a problem. So the job we’ve chosen right here is to take some of the enraging, terrifying, miserable components of American life, and produce you one thing entertaining, empowering, and helpful.
So, let’s begin with Dr. Shteynshlyuger. He began his personal observe about ten years in the past, and after a couple of years, he determined to exit of community with most insurance policy.
Dr. Alex Shteynshlyuger: I nonetheless would like to be in community as a result of it’s a lot simpler to observe in a means. It lowers prices to the sufferers, which make them extra more likely to come and see me.
Dan: He’d prefer to, however there was an issue. The charges insurers paid for his providers.
Dr. Alex Shteynshlyuger: I don’t have a market energy to barter with insurance coverage corporations, so what they do is they provide me the kind of charges the place you’ll be able to’t stand and keep in enterprise.
Dan: With one insurer, he says he misplaced cash on each case. He says he requested to barter.
Dr. Alex Shteynshlyuger: I didn’t even get a counter proposal. I simply bought a, a couple of sentence response that we don’t negotiate.
Dan: Full disclosure: I haven’t seen a duplicate of that response. But what he’s saying echoes tons of different reporting. Insurers pay larger charges to larger entities.
Lots larger.
For one of many first episodes we ever did, I talked with Jenny Gold, who was a reporter for KFF Health News [and of course they’ve since become our co-producers on this show]. She had mixed two databases to research hundreds of circumstances.
She was costs for delivering infants within the Bay Area, and he or she discovered
that when it was a giant native hospital system billing, versus a physician in solo
observe, insurance coverage paid double — typically greater than thrice as a lot —
for the very same service.
Her conclusion was: Big programs have numerous clout. And small fry get informed “take it or leave it.”
That’s the form of factor Dr. Shteynshlyuger says he was up in opposition to. So he decides he can’t survive on these take-it-or-leave it charges, and he goes out of community.
But it’s not like this takes out of the world of coping with insurance coverage corporations:
His sufferers have insurance coverage with out-of-network advantages, so he recordsdata numerous claims for them. He says he doesn’t all the time receives a commission– and infrequently when he does receives a commission, he says it takes a very long time, and loads of work.
Dr. Alex Shteynshlyuger: They can throw up numerous boundaries saying we’d like medical data and after they get medical data which are clear lower, like day and night time, you’ll be able to’t, a blind man can not make, you already know, uh, an error judging that the care was supplied. They nonetheless discover A cause to disclaim.
Dan: What he’s saying strains up with what others have discovered.
For occasion, in response to knowledge compiled by KFF, UnitedHealthcare reported to the federal authorities that they denied 23 p.c of claims. And they’re in the course of the pack. Some insurers deny much more.
But 23 p.c — that’s virtually one in 4.
Imagine if one out of each 4 paychecks, your boss was like, “Naaah, I don’t think you really worked those hours.”
And there’s an appeals course of. But if you happen to’re listening to this present, you’ll have had the expertise of interesting an insurance coverage denial while you’re the affected person. Or you’ve heard the tales, possibly right here, possibly from individuals you already know.
It’s no person’s thought of a great time, or a fast course of. And some fights, you’ll be able to’t win.
Now, think about you needed to battle like that for each fourth paycheck.
The consequence, Dr. Shteynshlyuger says, is that medical doctors like him are leaving non-public observe. And typically becoming a member of larger entities, with extra clout.
Dr. Alex Shteynshlyuger: There was loads of urologists in non-public observe after I began. And immediately, you’ll be able to barely rely them on one hand.
Dan: And we did discover a research exhibiting that there have been rather a lot fewer urologists in non-public observe in New York than just some years in the past.
… and writ giant: The variety of medical doctors in non-public observe is shrinking, shortly, throughout the nation.
According to the American Medical Association, 2020 was the primary 12 months when medical doctors in non-public observe grew to become a minority. Less than a decade earlier than that, the quantity had been 60 p.c.
And you already know who has been shopping for up doctor practices like no person’s enterprise? UnitedHealth Group’s’s Optum Health. Two years in the past, they caught as much as the 2 greatest hospital chains as employers of medical doctors, at 50,000. And they’ve stored going. Now they’re as much as 70,000.
Dr. Alex Shteynshlyuger sees this as one huge circle:
Dr. Alex Shteynshlyuger: So what they sometimes do is that they run the observe into the bottom after which they purchase it.
Dan: This seems like a conspiracy: Squeeze your opponents, so while you come providing to purchase, you’ve bought a … motivated vendor.
And I’m not satisfied it’s that… coordinated. United Healthcare’s not the one huge insurance coverage firm that squeezes small practices with low charges and plenty of denials. And docs have complained about it for a LONG time.
And they’re not the one ones shopping for up small practices– hospitals and personal equity-backed corporations have been doing the identical factor, for lots longer than United.
Similarly, when Dr. Shteynshlyuger describes what he calls the payday mortgage
setup, he talks about it like mainly a conspiracy.
Dr. Alex Shteynshlyuger: I imply, who can provide you with one thing like that? First, you don’t pay medical doctors or make them unable to satisfy the payroll. And you then supply them the mortgage from the cash that you simply haven’t paid them.
Dan: UnitedHealth Group disagrees. They wouldn’t go on tape with us– and we requested– we had numerous questions. But they despatched me an announcement, and it reads, partially:
Optum Bank’s Working Capital mortgage presents suppliers an choice to entry capital at market aggressive phrases. The speculative theories shared with us don’t have any benefit.
And really, it’s not fairly as easy as Dr. Shteynshlyuger says:
Loaning out precisely the money they’d be paying him.
Technically, at the least, the cash behind Optum Payday Advance doesn’t come
from insurance coverage premiums.
But from Dr. Shteynshlyuger’s perspective, it’s like UnitedHealth Group is surrounding him on a number of sides: They’re the insurance coverage firm he’s sending payments to, and preventing with.
And by gobbling up so many medical practices– together with a couple of native urology practices — they’ve additionally develop into HIS DIRECT COMPETITOR. And now, there’s what he calls this “payday loan business.”
UnitedHealth Group doesn’t should conspire in opposition to him. They’re already throughout him. And United — and different big entities — are more and more surrounding each well being care supplier we’d need to see.
Surrounding them with an online that’s getting larger and thicker on a regular basis.
I’m calling it an online, however one professional presents a distinct picture:
Lawton Robert Burns: One of my colleagues calls United a behemoth.
Dan: That’s coming proper up. This episode of An Arm and a Leg is produced in partnership with KFF Health News. That’s a nonprofit newsroom masking healthcare in America. Their work wins all types of journalism awards yearly. I’m honored to work with them.
So, it’s time to get a birds’ eye view. Let’s hear from an professional. Let’s hear from…
Lawton Robert Burns: Lawton Robert Burns. I’m a professor in well being care administration on the Wharton School on the University of Pennsylvania. I mainly research every part about well being care and have been doing so for over 40 years. And as I really like to inform individuals, I’m simply starting to know it.
*Dan and Lawton chuckle*
Dan: He’s the writer of books like “The Health Care Eco-System.” The Senate Finance Committee requested him to come back and discuss in March. So, I believe he ought to be adequate for us.
He says UnitedHealth Group just isn’t the one firm attempting to weave an online.
Lawton Robert Burns: There are six or seven different gamers on the market who’re doing the very same factor.
Dan: But United’s the most important. Biggest insurance coverage firm. Biggest employer of physicians. Biggest at a bunch of technical back-end stuff.
Lawton Robert Burns: One of my colleagues calls United a behemoth.
That’s in all probability the easiest way to explain – they’re a behemoth.
Dan: And all people else — any participant of any dimension– needs to be one.
Lawton Robert Burns: Everybody needs to get larger. And that’s the company technique of all people in healthcare. Just get huge. Do you keep in mind who Al Davis is?
Dan: So, I didn’t. But he was a legendary proprietor and supervisor of the Oakland Raiders like 40 years in the past, after I guess they have been successful loads of Super Bowls. And there’s a well-known clip of him.
Lawton Robert Burns: A press convention held proper after they received the Super Bowl. Al Davis is sitting there receiving the Super Bowl trophy.
Dan: And the announcer asks: How do you retain successful like this? And Al Davis says, you’ve gotta have nice coaches
Al Davis: Then, after you have got nice coaches, you get nice gamers, you have got a terrific group,…
Lawton Robert Burns: You should have good administration, and also you inform them one factor…
Al Davis: Just win. Just win, child.
Lawton Robert Burns: And he’s bought this huge grin on his face. Just win child. And so I’ve taken that and I mentioned, okay, all these gamers in well being care have taken a web page out of Al Davis’s ebook and it’s known as simply develop child. So if you wish to know what’s occurring, I simply keep in mind Al Davis. It’s simply develop child. And that’s all that each one of those persons are doing. It’s not be extra environment friendly or have larger high quality or to enhance entry to well being care. All these items is window dressing and a canopy for what’s actually occurring. What’s occurring right here is it’s simply develop child.
Dan: And Lawton Robert Burns just isn’t so huge on progress. His most up-to-date ebook known as “Big Med: Megaproviders and the high cost of health care in America.” He’s fast to level out, that ebook doesn’t take a look at United, which is now arguably the most important megaprovider. That ebook solely seems at hospitals consolidating– merging into Big Med.
Lawton Robert Burns: The hospital sector is the place we now have extra proof.
Than anyplace else. And the outcomes there present that costs go up. When
hospitals consolidate, prices go up when hospitals consolidate, high quality stays
the identical or declines when hospitals consolidate, it’s not a fairly image.
Dan: There’s much less knowledge for different kinds of gamers in well being care, however he’s checked out what knowledge there may be.
Lawton Robert Burns: Across virtually all sectors, there’s little or no excellent news about what occurs when these organizations. or these sectors of well being care get larger.
Dan: What concerning the claims from huge corporations like United that they supply higher service as a result of they will coordinate, I imply right here’s what United mentioned within the assertion they gave me:
“We are committed to improving the health system for everyone, advancing evidence-based practice and aligning incentives across the system to ensure people get the right care at the right time in the right place.”
Lawton Robert Burns: Who’s not going to say that? Come on?
Dan: What concerning the thought of economies of scale? Like, you purchase 1,000,000 stethoscopes, you get a greater deal. He’s like, yeah. Economies of scale, huh?
Lawton Robert Burns: it’s the one most invoked rationale for getting larger, however there’s little or no proof that it exists. Here’s what I inform my college students: When you hear the expression economies of scale, suppose BS.
Dan: So, Lawton Robert Burns just isn’t seeing the upside. And he’s not seeing any controls.
Lawton Robert Burns: The regulatory businesses, each the federal and the state degree don’t have, you already know, all of the horses on the earth to pursue every part that’s occurring. They’re simply too many of those offers occurring huge and small, involving hospitals, medical doctors, insurance coverage, different, you already know, they don’t have the horses. To, like, do something about it, not to mention monitor it.
Dan: Yeah. And so it leaves me, involved
Lawton Robert Burns: Yeah, you’re proper.
Dan: Erin Fuse Brown is worried too. She’s a legislation professor at Georgia State. She research consolidation within the well being care enterprise, and he or she’s a pal of the present, so she’s just about the primary particular person I known as for a tackle what Dr. Alex Shteynshlyuger calls the payday mortgage proposition.
Erin Fuse Brown: Okay, let’s see if I will be type of, uh, politic about this. It
sounds completely loopy.
Dan: If Lawton Robert Burns is skeptical of behemoths– like, doesn’t see the proof that they’re good — legislation professor Erin Fuse Brown is able to see the harms.
Because it is a entire space of legislation: It’s known as antitrust, proper? The thought is, corporations can get too huge for anyone’s good. They can choke out competitors and simply milk all people for revenue.
And United Health Group as a behemoth — greatest insurer, the most important supplier — opens up a complete new form of antitrust query.
Erin Fuse Brown: That simply blows my thoughts, I don’t even know what occurs when these two issues occur, like collide into one entity, these two issues occur, like collide into one entity, um, I, I, I don’t know. I’m a bit of afraid, proper? Like I believe that we’re going to get it on each side, like our premiums are going to go up, our costs are going to go up, and so they’re those who’re making the most of all of that.
Dan:And their earnings are SUPER-high proper now. The inventory value is thru the roof. Erin Fuse Brown says, it’s an issue that regulators can’t sustain with the tempo of offers that flip an organization right into a behemoth.
Erin Fuse Brown:. Once it’s fashioned, antitrust has little or no potential to interrupt it up or restore competitors to a market.
Dan: So, that’s regarding. But the issue isn’t simply that antitrust regulators can’t sustain with the tempo of those offers. It’s that anti-trust regulators don’t have a great way to battle sure sorts of offers which are turning into widespread.
Erin Fuse Brown: Antitrust has not been doing a very good job of policing or going after transactions which are vertical in nature.
Dan: Vertical in nature. This is the way in which anti-trust of us speak about what corporations like United Health Group are doing: Spinning an online that covers numerous totally different sectors.
So, HORIZONTAL consolidation could be United shopping for one other insurance coverage firm.
VERTICAL consolidation is United using tens of hundreds of medical doctors.
Erin Fuse Brown: Antitrust has a great observe file of a horizontal hospital in a single metropolis shopping for one other huge hospital in the identical metropolis. That antitrust is able to, you already know, of preventing. But there isn’t a observe file in well being care of a profitable vertical problem.
Dan: And she says the dearth of a observe file is form of a self-perpetuating drawback.
Erin Fuse Brown: nobody needs to be the primary mover. No decide needs to rule with out precedent, even when the financial proof is beginning to pile up that these vertical consolidations are Just as competitively dangerous.
Dan: And recognizing that drawback, regulators convey fewer circumstances.
Erin Fuse Brown: The antitrust businesses don’t need dangerous precedent. And in order that they’re, they’re hesitant to convey these circumstances. I imply, it’s straightforward to take a seat in my ivory tower and, and dare the Department of Justice and the, and the FTC to be extra daring, um, however to really begin bringing these circumstances, you already know, construct up the proof base. Like they should get a win on the board so as to have the ability to, um, go after these mergers and I, and in the event that they don’t, and the issue is, is just like the one time they’ve tried, um, I believe in latest reminiscence, which was the United Change case, they misplaced.
Dan: Yeah, UnitedHealth Group needed to purchase an organization known as Change Healthcare, which does a bunch of back-end stuff to resolve insurance coverage claims. They do it for many insurance coverage corporations.
And the feds mentioned: Whoa, maintain up. No. That’s gonna allow you to see what all the opposite insurance coverage corporations are doing. You’ll have entry to all their most delicate knowledge.
The feds introduced that case.
United mentioned in court docket: It would completely by no means exploit that knowledge.
Erin Fuse Brown: it’s saying it’s not going to have a look at its opponents knowledge
for anti aggressive benefit,
Dan: United mentioned it already had entry to tons of delicate knowledge — from different back-end features it was already performing for different corporations.
If these opponents trusted them, why shouldn’t the court docket? The decide purchased that argument, and the feds misplaced. That was simply final 12 months.
Erin Fuse Brown: And I believe that has some detrimental results as effectively, it emboldens it.
Dan: So we find yourself with these rising behemoths, with increasingly more “market power.”
Erin Fuse Brown: Once they type, there’s little or no one can do to cease them from utilizing that market energy to extend costs or, cut back entry or, or no matter dangerous impact would possibly then ultimately attain the buyer.
Dan: Which does. Not. Sound. Great.
But– I appeared up the essay that labeled United a behemoth.
And the writer– a man named Jeffrey Goldsmith– famous that behemoths don’t essentially final without end. He wrote:
United has grown to its current immense scale largely with out public information.
Americans are suspicious of huge enterprises, as companies from Standard Oil, US Steel and ATT to Microsoft and Facebook have realized.
He thinks United is “highly vulnerable” to the danger {that a} big information occasion will crystallize public opinion in opposition to them — will verify the narrative “that United is mainly about maximizing its own profits, not about improving the health of its subscribers or the communities it serves. It is not clear how many of the tens of millions of United subscribers have warm and fuzzy feelings about their giant health insurer.”
Me, I’m guessing: Not too many.
For now, for these of us who could NOT have such heat, fuzzy emotions, we’ve
made a begin: We’re beginning, proper right here, to construct extra public information, our
personal information, about UnitedHealth Group’s immense scale.
And information is the start of energy.
I’ll catch you in a couple of weeks.
Till then, maintain your self.
This episode of An Arm and a Leg was produced by me, Dan Weissmann, with assist from Emily Pisacreta and edited by Ellen Weiss.
Big thanks this time to the author, journalist, and activist Cory Doctorow. This story jogged my memory of themes from his work, together with his latest ebook, Chokepoint Capitalism, and Cory was variety sufficient to speak with me.
I didn’t fairly handle to make these conversations a part of this episode, however: If you don’t know Cory’s work, it’s spectacular.
I’ll have some hyperlinks wherever you’re listening — and extra in our publication:
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Daisy Rosario is our consulting managing producer.
Adam Raymonda is our audio wizard.
Our music is by Dave Winer and Blue Dot Sessions.
Gabrielle Healy is our managing editor for viewers. She edits the First Aid Kit Newsletter.
Bea Bosco is our consulting director of operations.
Sarah Ballema is our operations supervisor.
And we’ve bought a summer time intern: Welcome, Bella Czajkowski
An Arm and a Leg is produced in partnership with KFF Health News–previously referred to as Kaiser Health News.
That’s a nationwide newsroom producing in-depth journalism about well being care in America, and a core program at KFF — an impartial supply of well being coverage analysis, polling, and journalism.
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