The Benefits Playbook

TPA vs. ASO: Which Is Right For You? with Lee Lewis, CSO & GM Medical Solutions at Health Transformation Alliance

Episode Summary

This episode features an interview with Lee Lewis, Chief Strategy Officer and General Manager of Medical Solutions for Health Transformation Alliance (HTA). At HTA, he spearheads efforts across 50 large employers and six million employees to transform healthcare, save lives, and save millions of dollars. Lee has spent his career advising Fortune 10 employers, insurance companies, medical associations, and the Departments of Justice and Labor. In this episode, Sasha sits down with Lee to discuss the benefits of a TPA versus an ASO, virtual primary care, and putting trust back into healthcare.

Episode Notes

This episode features an interview with Lee Lewis, Chief Strategy Officer and General Manager of Medical Solutions for Health Transformation Alliance (HTA). At HTA, he spearheads efforts across 50 large employers and six million employees to transform healthcare, save lives, and save millions of dollars. Lee has spent his career advising Fortune 10 employers, insurance companies, medical associations, and the Departments of Justice and Labor. 

In this episode, Sasha sits down with Lee to discuss the benefits of a TPA versus an ASO, virtual primary care, and putting trust back into healthcare.


“If you are a huge employer, if you’re AT&T or Walmart, you have enough leverage that carriers will build systems in place that enable you to do creative things. The difference between a TPA and a carrier is, it's still remarkable but it's smaller. The gap is smaller. But, if you're a small employer, you don't have the buying power with any carrier anywhere. You're a rounding error to them. You're not going to get any type of flexibility or creativity supported. Whereas, if you work with an independent TPA, you can still access a lot of those things that might otherwise only be accessible for a huge employer. Secondly, getting data is really hard with large carriers. If you have a TPA, you have the chance to get your data like a large employer might, even though you're smaller.” – Lee Lewis


Episode Timestamps:

*(01:09): Lee breaks down TPA versus major carrier options

*(04:53): Busting the myth that TPA is more complicated than ASO

*(10:39): The top 3 components of a best-in-class healthcare benefits program

*(22:05): Lee’s opinion on virtual primary care

*(28:27): Lee discusses self-funded versus fully insured

*(33:17): Lee shares his favorite healthcare story



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Learn more about Collective Health

Episode Transcription

Sasha Yamaguchi: Let's face it, healthcare is confusing and costs are continuing to rise. Employers are looking for ways to improve the health of their people and their bottom lines. The good news, many leading companies are leveraging self-funded health plans and innovative benefit solutions to do just that. Learn from some of the best minds in employee health.

Sasha Yamaguchi: Welcome to The Benefits Playbook, strategies for self-funded health plans. I'm your host, Sasha Yamaguchi, Commercial Leader at Collective Health. Welcome to the very first episode of The Benefits Playbook. On today's episode, we are joined by Lee Lewis, Chief Strategy Officer. And GM for Medical Solutions for Health Transformation Alliance.

Sasha Yamaguchi: He's advised healthcare strategy at Fortune 10 employers and has helped form two dozen health benefits startup companies. Thanks so much for being here with me, Lee. Really excited to have you on. Hey, 

Lee Lewis: my pleasure to be here. Thanks so much. 

Sasha Yamaguchi: So Lee, I recently moved over to the TPA world, if you will, and I know you've done a lot in the third party administrator space.

Sasha Yamaguchi: Would love to hear and start off by you sharing your experience. And then of course I would love to hear from you your thoughts on the difference between the third party administrator solution compared to our major carrier options that are out there. 

Lee Lewis: So for me it was serendipitous. I began my healthcare career after coming out of P N C insurance.

Lee Lewis: I started working for an administrator and I did not know anything about healthcare. And this was in 2012. I always say it was like learning how to make candy and your first job is at Willy Wonka's Chocolate Factory. So it was. Not conventional compared to working for a major carrier, but I didn't know what was normal and what wasn't, and it really was wonderful.

Lee Lewis: I got to see. Highly strategic employers who are doing lots of different things. I learned a lot about how claims are paid, how systems integrate, how benefit designs work. I learned about different rules at different insurance carriers, so different networks. So Aetna has different rules than. Blue Cross, for instance.

Lee Lewis: You know, I was there for half a decade. When I left, I started learning what happens on a more traditional basis, and that gave me kind of a good frame of reference that effectively working with a TPA gives you an additional layer of control and influence and flexibility in how you manage a health plan.

Lee Lewis: And so it, it ends up being a really good option for large, innovative employers. 

Sasha Yamaguchi: Do you feel like it could also be a good option for smaller companies, but those that are growing and looking at a more creative solution, I. 

Lee Lewis: D probably even more so. So I'm glad you mentioned that. I have a bias about large employers, 'cause that's where I've made most of my career.

Lee Lewis: There's a couple reasons. A small employer is disproportionately helped by using an independent TPA. The first is that if you are a huge employer, if you're at T or Walmart, you have enough leverage that carriers. We'll build systems in place that enable you to do creative things. And so the difference between the flexibility of A TPA for really big companies anyway, the difference between a TPA and a carrier is it's still remarkable, but it's smaller.

Lee Lewis: The gap is smaller. But if you're a small employer, you don't have the buying power with any carrier anywhere. You're a rounding error to them. And so, You are not going to get any type of flexibility or creativity supported. Whereas if you work with an independent TPA, you can still access a lot of those things that might otherwise only be accessible for a huge employer.

Lee Lewis: Secondly, getting data is really hard. Generally speaking has historically been challenging with large carriers. And if you have a TPA, you have the chance to get your data like a large employer might, even though you're smaller. 

Sasha Yamaguchi: No, and I love that point 'cause I think even groups that aren't large, they wanna know what's going on with their plan.

Sasha Yamaguchi: And so to be able to get that data, I think is super important. Also, if they're growing right, they're starting small, but they're each year having significant growth, they wanna start in the right setting. The get go. So I think a lot of people when they, in our industry or outside of our industry, when they think of this TPA solution, they feel it's more complicated and less convenient when they compare it to, say, a traditional carrier.

Sasha Yamaguchi: I. ASO option. Would love to hear your thoughts on, do you feel it's more complicated, and share with the audience why that may not be true and why groups should consider buying A TPA and what are the benefits of that? I know you've touched on it a little bit, but I think people just think TPA, it's more complicated when in actuality it may be a more streamlined approach and not as complicated or complex as they think it might be.

Sasha Yamaguchi: I 

Lee Lewis: think the first concept of kind of whether or not it's complicated, I would say that it can be more complicated, but it doesn't have to be. So unpacking that a little bit, it's like having a car with more gears. I. Okay, so when I first started driving, I was in a crappy little Hyundai that they don't make anymore, and it had only, I think it had three gears in it, but when I got older, I had the chance to drive faster cars that had six different gears, right?

Lee Lewis: And different options that were available. Having more gears doesn't make it more complicated. It just gives you more range, and I think that's the right. Comparison with a TPA for instance, if I were a SM, an employer who was nervous about it, but I started working with the TPA, I could say to the TPA, I want you to do everything the same as I have right now.

Lee Lewis: So let's maybe use the same network. I'm gonna do the same plan design, I'm gonna use the same SS p d and plan document. I'm gonna keep everything the same. And if I were to do that, the TPA could say, sure, we could keep the same types of disease management programs. We could keep the same prior authorization in place for different types of transactions or services, and everything could stay the same, and it would be effectively exactly like having another carrier, but you might have more services occurring in the background that you don't see that are still really advantageous.

Lee Lewis: But if you said, The following year, I want to do maybe some direct contracting or have a two tier in network benefit, or maybe I want to carve out one element of service, or I wanna enhance something within prior authorization. And I wanna have all my data moving into a data hub that gives me more, uh, over my ability to set up data feeds.

Lee Lewis: These are all things where. If you had a carrier, you're probably gonna get told no to many of those. Whereas if you have an independent TPA, they're likely, they'll say yes to everything, and that is where that range comes in. And so I, I don't think there's any downside to moving to a tpa. A if you're worried that, you know, you don't want to go faster or go offroading, so to speak, to stick with the car analogy, you don't have to, you can still keep everything there, but now you have the options.

Sasha Yamaguchi: And I agree with you, and I feel like that's what companies need to know is you can move to A TPA and not build this super complex system just yet. It can feel bundled. It can be with a TPA, that it's one 800 number I. And then over time, start building it out. I agree. I think everyone thinks, oh, I'm moving to a TPA.

Sasha Yamaguchi: I have to build this super complex system. It does not have to start that way. 

Lee Lewis: That's right. It's hard to quantify, but there's something of a psychological tax that happens to people who are running benefits plans, whether they employers or benefits teams or people in HR that. Every time you try to do something, you have to get, it seems when you're working with a big carrier, multiple layers of permission and there's often resistance.

Lee Lewis: You often get questioned about why you're doing it. You have to do two or three meetings, and there's sort of a passive aggressive shaming that goes along with your request and it's just how the game is played, but that creates this psychological drag or tax that. That just slows down and it's energy sucking for people who are trying to do the right thing for a health plan, take care of their people.

Lee Lewis: And if you have a TPA, I've just found, like when I worked there, we didn't have the luxury of saying no. We had to say yes and figure it out and. Sometimes when I talk to employers who are struggling with this, I say, man, wouldn't it be amazing if when you asked a question of your carrier, the answer was yes.

Lee Lewis: And if you are someone who is just constantly being weighed down by a lot of nos, that's a really good indicator that you might wanna look at A TPA. 

Sasha Yamaguchi: So let's say a carrier does say yes compared to a TPA. I feel like the TPA is able to move a little quicker. I would love to hear your thoughts on that.

Sasha Yamaguchi: I feel like the speed to getting something done can also be a little quicker on the TPA side. Have you experienced that? 

Lee Lewis: Yeah, so TPAs are just, they're going to be smaller, they're more nimble, and you have more options, right? So if you say, I need to have a simple data feed set up between parties A and B with a large carrier, I might be paying like a ton of fees there.

Lee Lewis: It could take two or three months to get an N D A in place with the vendor, and then you wait another. Lengthy period of time before the data feed actually occurs. When I'm working with A TPA, I might be able to avoid some of the bureaucracy around NDAs or there's a very simple N D A that occurs versus waiting two or three months just to have an N D A created and then you can make stuff go through quickly.

Lee Lewis: And that's after you've already gotten to Yes. Now. You might get to, yes, in a week versus a month if you're working with a TPA but if the starting line is at yes, with either, then the completion line of actually finishing implementation even on a simple task is much quicker. 

Sasha Yamaguchi: I would agree. I know that.

Sasha Yamaguchi: We all talk about best in class, right? And employers are looking for a great best in class program experience. When you think of that, or when you're meeting with groups and you think of just the parts of that, the components, what do you really feel is a great best in class program? What are the top three things that you talk about when you're meeting with companies?

Sasha Yamaguchi: Oh, 

Lee Lewis: yes. I'll try and keep this one real succinct. So the first thing is data. I call it my three F's. You need to have the data flow, so you need to be getting access to it. You need to be focused, which means tracking the right types of metrics and focusing on improving those. You normally we're sort of surrounded by insights that are not actionable.

Lee Lewis: You need to declutter that and focus in on the right kind of KPIs, things like outcomes, trend. Affordability, satisfaction, things like that that really matter for managing a population. And then the third F is fiduciary. You need to be having continuous review of your transactions so that you are educated about them and so that you can find any errors that come through because anybody can make mistakes.

Lee Lewis: The secondary is clinical. There's three Cs, cartilage, cardiac, and cancer. Those are things that ought to be acted upon within cartilage, so that's your joints, your M Ss K, your surgeries. We know that approximately half of all the orthopedic joint surgeries that are occurring are unnecessary. That's at least what the literature shows.

Lee Lewis: We just don't know which half. So you need to make sure there's a really robust second opinion diagnostic process prior to orthopedic surgery. Within cardiac, 92% of working people are not on the right drugs to prevent a heart attack. Once they are identified as high risk, we can work with a pharmacist really easily through a remote disease management program to find and help correct that.

Lee Lewis: And then within cancer, you need to be having a second opinion from an expert center. For your diagnosis and the therapy, you do that 70% of the time. There will be a change in the diagnosis or therapy. It's critical that you get that right before you do anything, before you spend $1 on cancer. And then finally, within delivery, you get a carrier that gives you a good supply of providers, right?

Lee Lewis: Whether you're Blue Cross Retina or Cigna. Problem is there's three major gaps that any provider network has. One is primary care. A ton of the new primary care going on right now is cash based, not covered by the network, so we wanna make sure we add that in. The second is behavioral health. We need to reinforce the behavioral health network that's already in place.

Lee Lewis: And then finally, centers of excellence. You need to be able to add in the really high value, low cost, high quality providers that it's just a great benefit for all your people, especially your lower income folks to make surgery both affordable and also save money for the employer. Wins for everybody. 

Sasha Yamaguchi: So you just made me think of tacking onto that when I moved over to the t P.

Sasha Yamaguchi: A World Point Solutions is such a huge topic. All of the program partners, so when you talk about networks, that's so important, but how do you see. The all the point solutions. I mean, there's so many right, available right now. How do you see them supplementing, adding on, providing extra support to programs in addition to, like you just said, the behavioral network?

Sasha Yamaguchi: What are your thoughts just on that? There's so many out there, but the point solutions world and how that plays into that program for the 

Lee Lewis: employers. Totally. So employers. You have the base architecture that we've gotta set up, right, which is getting, you know, a good carrier and a good administrator. And I do recommend to our employers, Hey, if you can't keep those separate, have your carrier, but have your administrator be separate as an independent payer or basically an accountant.

Lee Lewis: They pay the claims, but they don't have the contracts with the hospitals. But from there, you need to augment it, right? You need to go after market to find the best. Clinical capabilities and delivery capabilities. I'm tracking I think 101 categories right now that a large employer could R F P, separate categories, not vendors.

Lee Lewis: Vendors themselves were well over 400 that are just catering. To larger employers, and so within that ecosystem, we organize and then we prioritize. It's how do you decide what to do? Should we tackle M S K or should we go after cancer? Do we add fertility or second opinion, or telemedicine or navigation?

Lee Lewis: It's really hard to make these decisions, so that's why you need to prioritize. Based on lots of things. I like to look at what's gonna give me the biggest kind of bang for my buck and is gonna be most efficient to implement. 

Sasha Yamaguchi: I learned how many are out there and it's a whole nother world, and it's another kind of area where these employers, back to what you were saying, they move over to the TPA.

Sasha Yamaguchi: Arrangement. They get options, but there's so many options. I think having an administrator that helps also line up the right program partners, point solutions that might work for that population is super important. 

Lee Lewis: Oh, totally. I have a heuristic that I use because it's gonna be impossible for me to R F P 400 different vendors plus plus.

Lee Lewis: So I use just a simple heuristic. We call it one, two, three, four, five, to sort vendors between. Like the top 1% of good stuff that we ought to be looking at. So it's one is 1%, is it getting me net 1% savings on my total budget. It's a real quick one right there. Even if I eliminated 100% of my allergy costs, it's still less than 1% of my entire budget.

Lee Lewis: I mean, that'd be amazing if we could stop allergies, right? It's a huge drag, but you know, in comparing how much we actually spend on it, it may not be a huge portion. So we have to prioritize what we're tackling. Number two is I want a two to one ROI. As a minimum guarantee, and then I'm usually targeting about a four x ROI when we're looking at making investments, a ton of people say, Lee, that's super mean.

Lee Lewis: You know, I'm, I'm getting you a one to one ROI. Friend Mike Adams always says, ROI stands for return on investment, not return of investment. And I love that concept. It's totally true. I can't get the year of time I spent with you back even if you refund my money to me. So I need a two x. Number three in the heuristic is what I call the three hob goblins of fake ROI, which is volunteer sampling bias where you just compare those who opt in versus those who don't.

Lee Lewis: Regression to the mean, which is. Naturally people flow in terms of risk and also cost. And then the third is survivorship bias of just comparing people who complete a program with those who didn't enter the program. And you can sort of count or not count the people who sort of dropped out. That's not a legitimate way to, to be able to calculate ROI.

Lee Lewis: So if we control for those, the number four is pay for performance. I don't use P M PMs almost ever. Occasionally we will, if it's the right kind of thing, but we really like to tie payment into utilization so that we de-risk and realign incentives. Then number five is we want fifth grade math on everything and.

Lee Lewis: The place where an administrator comes in is we need to be able to, a, have the choice to integrate the right solution stack, and B, we need to be able to get good data and good support in analyzing what's going on with the different cohorts of patients and different cost categories so that we make sure we are gathering good data and making good decisions.

Lee Lewis: If you don't have good support, if you don't have good data, very hard to do that and administrators excel in that regard. This is 

Sasha Yamaguchi: somewhat of a broad question, but is there any group that you've deployed a strategy? Can you give an example of something you've put in place that's really just taken off, worked well for a group?

Sasha Yamaguchi: Can you give an example of one of those that you've put in place for one of your groups? Oh, 

Lee Lewis: lots. So when I first started at H T A, it's a cooperative, but we're, it's a nonprofit entity, and so when I began here, we needed to have some progress within medical, and we decided to start with looking at major problems that we knew we could address.

Lee Lewis: One that we came in with early was fiduciary. It's trying to find one or two firms that can review claims, help us have really good feedback on what's occurring, and also be able to get some savings, get some nice ROI. We put two vendors in. One of them has since been acquired and transitioned out. The other has been just crushing it for us, and that took off.

Lee Lewis: We probably got over half a million lives that are using that right now. Another problem we ran into is, All my employers wanted their data. I wanted to be able to have it and be able to analyze it when needed and run queries on it, but none of them could. And then the process of even running a simple query.

Lee Lewis: Could take months because either A, you're dependent on somebody else, or B, they would need to send it to you in order to do the query, and it could be incredibly lengthy. So we found a server software vendor that set up something called a lockbox server where it's per medically sealed, but it enables employers to have their data fed into it, but it's sealed off so you can't breach yourself.

Lee Lewis: But you now have kind of possession of your data in a server that you control. And that has been a wonderful strategy for us. And we have probably a million and a half lives that are using lockbox servers today so that employers can finally get, at the very least, an archive copy of all their data. That has been wonderful.

Sasha Yamaguchi: That's amazing. Yeah. Groups want that data. I mean, that's just super important and they just don't always 

Lee Lewis: have it. I. Completely. And so that ended up being a good one for us. We've added a primary care network where we're bringing in the cash-based primary care into our regular kind of carrier health plan, making it so that it's accessible for people who don't want to just pay with their credit card.

Lee Lewis: And we added a supplemental network for. Behavioral health so that you can get in-person or remote behavioral health access in like 2000 cities with providers who were formerly out of network where we were able to layer them back in. Those are probably some of our most successful breakthroughs that we've had in the last three years.

Sasha Yamaguchi: I think that behavioral one is so important because you have somebody that needs those services and the last thing you want is for them to not be able to get to a provider 

Lee Lewis: completely. Yeah. Access is huge. These people are going to get care. It's not like not giving access to therapy means that you don't have the problem.

Lee Lewis: There were stories during covid of people saying, oh, some countries have really low covid numbers because they're just not. Reporting it as Covid, or there's been reports suggesting that in Venezuela, they made starvation deaths by starvation plummeted because they started forbidding doctors from calling it starvation.

Lee Lewis: They had to come up with a different reason for somebody dying. And when you retitle something, it doesn't make the underlying items change. What are your 

Sasha Yamaguchi: thoughts on virtual primary care? I feel like that's probably one of the top. Topics in our industry that's coming up daily. Right? Virtual primary care, making it available, having access.

Sasha Yamaguchi: Just your thoughts on that and how it's changing the industry really and how people access care. 

Lee Lewis: We are a long ways from having every city, town, and Hamlet having. Access to good advanced primary care in person. And because of that, I think it is critical that you supplement with outstanding primary care, the best you can get virtually to cover hard to reach areas.

Lee Lewis: That said, I also believe and know that as homo sapiens, trust is a huge part of healing. Cynically, it's called placebo effect. In a drug trial, if people trust a therapy will help them. It does, and we're always having to control for the fact that 30% of medicine is trust and the chemicals and ingredients have to beat that 30% so we can eek out a positive value above the sugar pill and.

Lee Lewis: We need to have trust. Trust is the one part of medicine that's been completely removed from the system in many places because in order to have trust, you must have a relationship. And in order to have a relationship, you must have time. And because we now contract or spend time with doctors in increments of 30 seconds, we.

Lee Lewis: Aren't given the time to form trust, and that hurts our healing. And so virtual primary care with a longstanding recurring relationship is I think critically important. But then also having something in person is really critical. We're spending a ton of time. Doing the hard work of finding physical access in cities and towns so that people can visit with another human in person.

Lee Lewis: I 

Sasha Yamaguchi: love where you went with that because I think everyone thinks virtual care. It's great and I love that it's available, but I. That just in general in-person over virtual connection zooms is, we all know when we're in the same room with each other, we get so much more out of it. And I will share with you my P C P for the first time in years.

Sasha Yamaguchi: I, when he comes in, I feel like he's not rushing to get outta the room and it is really nice. So I think that trust is important. I mean, he just never makes me feel like he's rushed. We talk. And it makes such a huge difference versus in and out and they've moved on to the next room. 

Lee Lewis: The way I like to compare it as it relates to the virtual kind of advanced primary care versus in-person is, you know, when we were all first getting vaccinated from Covid, you had sort of the j and j one shot, right?

Lee Lewis: Which had efficacy, and then you had the Moderna triple threat after you do the two plus a booster, and all of them are good. In my mind, the full virtual primary care is sort of like the j and j one shot. Whereas if you can get advanced primary care in person, that's like the triple right. All of it's better than what we have.

Lee Lewis: Nevertheless, I think there are advantages to having, not just the virtual, if you can make it happen, 

Sasha Yamaguchi: I. I love that. No, I agree. Do you do onsite clinics, have you worked with that strategy for companies that put onsite? Obviously not every company's able to do that, but some are, and I think being able to get to their employees and have their employees have that access can be really great for companies.

Sasha Yamaguchi: Yeah, 

Lee Lewis: I have both formally as a consultant and then now in my current role within the co-op work with. Tons of employers who have onsite clinic locations. It's a mixed bag in terms of their satisfaction with 'em. So some of my employers have added them and expanded the program and love it. I have two that absolutely love it, and they're aggressively expanding their program.

Lee Lewis: They're working with two different vendors, and it has been a wonderful opportunity to be able to get people rapid quick access. They're able to wrap it with some of the work site workers' comp. Delivery as well, which is a nice blend when you have it on site. And then lots of good data gathering and then you can influence exactly how care is delivered.

Lee Lewis: So that has been the positive. Many of my other employers had onsite clinics. I. Then fired. One management vendor, hired a different one, ended up not liking that and moved past it again and have had a hard time getting a experience and a manager that they like, uh, others have that have had a hard time, have said it was just way too expensive that the ROI wasn't there.

Lee Lewis: I have two others who have been shutting them down, so a little bit across the board. Our approach is agnostic actually on onsite clinics. It's great if you love 'em. It's fine if you don't. It's no problem, but where we have focused is. Near site clinics. Near site clinics allow us to democratize the cost so it's not all on one employer.

Lee Lewis: It makes it easier for spouses and kids to get access because a lot of people don't necessarily love going into their spouse's workplace. Right? Like it becomes more like a school nurse. If you're a student, you use the school nurse, but, and while you're at school, but like nobody else, if you have a near site clinic, you're able to avoid some of that.

Lee Lewis: So you get higher utilization. Probably lower cost, a shared burden of setting it up and you generally get more amplified services, and so we found that to be a nice compromise. 

Sasha Yamaguchi: Yeah, I love that option, especially if there's a couple of companies that have a shared value and you can put one near multiple.

Sasha Yamaguchi: That's a great alternative. So interesting topic, I would love your input on, a lot of companies are still fully insured. That are larger employers. A lot of small employers are moving to self-funded. Years ago, the only self-funded employers were these jumbos. I feel like smaller companies are moving, but then you also have large companies that haven't quite yet moved.

Sasha Yamaguchi: What are your thoughts on self-funded versus fully insured and. What type of groups do you feel should be moving and what should they consider to move to self-funded, I should 

Lee Lewis: say? Yes. Okay. So anybody who's listening to this, if you're fully insured and you've got more than a hundred or so people, you need to look at self-funding, do an R F P.

Lee Lewis: I know your broker takes you golfing, and you know, You have a good time. Whatever you need to look at, self-funding. The reason I'm talking to you, California, like especially. We have a lot of fully insured. You're notorious about being fully insured, millions and millions of dollars past your expiration date.

Lee Lewis: If you're over a hundred employees, you ought to be looking at self-funding and many employers self-fund extremely profitably. Below that, why would you do it? Well, a, you can work, work with A TPA and say, I don't know anything about. The stuff, right? I've always been with a fully insured. Just say, I want you to match everything I have right now so it feels the same, and use the same network.

Lee Lewis: That's a really reasonable, easier request. I want the same network, the same plan design. I want all of that to be the same. I just want you to make it a self-funded version of that versus fully insured version of that. That way it keeps it simple for you and it keeps the same experience, but guess what?

Lee Lewis: You're gonna save five to 10%. All of those, like 12% increases to 20% increases you're getting every year. We're gonna cut that in half on your trend. It's absolutely wonderful to be able to take that step and you can baby step it so that it feels like fully insured and they handle it through like a level funded program, or we get a stop loss with a really, really low level.

Lee Lewis: So you're basically still kind of fully insured, but you now at least have training wheels. On a bike, but you're not riding a big wheel. That's the difference. So the same risk level, the same kind of experience. You've still got guardrails, but now you have so many more options so that each year you can slowly start to improve things.

Lee Lewis: The reason people don't self-fund, Is because they're scared and they're not knowledgeable around it, and the reason they're scared and not knowledgeable around it is because brokers make more money if you don't sell fund. I. You save monster amounts of money and get tons more flexibility, more choice, you can actually run your business, but whoever is advising you makes way less generally speaking.

Lee Lewis: And so there is no incentive other than your own incentive to go self-funded. And so your traditional advisors are never gonna tell you to do it. You need to tell your advisors that you want to do it, and then find an advisor who's there for that. 

Sasha Yamaguchi: I love all of your points, and it is amazing to me how many groups are still self-funded, and I do think there are some.

Sasha Yamaguchi: Consultants, brokers that are starting to push groups to the smaller size of moving, and even that in a handful of cases, they're trying to get the clients to move that way, and clients are just still scared of going self-funded. But I love your point about the renewals, even the favorable renewals, which is why they keep renewing fully insured.

Sasha Yamaguchi: They don't realize could be cut in half. To your point, 

Lee Lewis: when we see groups, 30, 40% plus cost reductions, there's so much opportunity there. And the carriers also, even if you have a consultant or a broker who's telling you, Hey, you ought to go self-funded, you need to stop being fully insured, and it makes people nervous.

Lee Lewis: The other thing too is people don't understand that you're still fully insured. You're just kind of fully insured, light. Because you have stop loss that covers all of your huge costs down to a pretty low, reasonable level. It's just like having a higher deductible. If I have car insurance with a two 50 deductible and then I go to Geico or Allstate or whomever, and I say, I want to increase that to a thousand dollars deductible, I'm not saying I'm self-funding my car insurance.

Lee Lewis: I just have a higher deductible. That's effectively what you're doing. You're still fully insured. You don't really become self-funded, self-funded until you have about 20,000 people on your plan, and then you are truly self-funded. But there's a ton of range between a hundred people and 20,000, all of which are gradients of still being fully insured.

Lee Lewis: But if you technically have stop-loss in place and are paying some of those early claims yourself that. Completely changes the way you're able to manage your business. 

Sasha Yamaguchi: Well, you all heard it here from Lee Lewis a hundred or more go self-funded. Look at it. So I wanna end on a fun topic. Have you ever had a situation where someone says, Lee, what do you do?

Sasha Yamaguchi: And you talk about being in healthcare and you got stuck or had a, a really interesting conversation with someone once they realized the industry that you're in. 

Lee Lewis: Yeah, there's a few. I've gotten to the point now when somebody asks me, what do you do? I say, either I help large employers make healthcare.

Lee Lewis: That's awesome. Or I help large employers to make healthcare not suck. My best answer ever, and I've, I've told this story a few times. I was doing some. Advisory work. This was back in 2018 over at Google and I'd never been there before and I was kind of nervous and I was in an Uber headed to their office and I was fidgeting in the backseat because I wanted to make a good impression.

Lee Lewis: And the driver turned and asked me what I did, and I told her and she said, oh, I love my healthcare. I'll never. I'll never leave my employer because I love my healthcare so much and I just dropped everything. And I'm like, what? Like I've never heard anyone say that. And also you're driving for Uber. She's like, no, no, no.

Lee Lewis: I'm on spring break. I'm a bus driver for the local school district. And I said, so tell me everything. What is it that you love about healthcare here in the us? She said, well, a couple things. She said, I know my doctor and he knows me and he knows my two boys, and I know if anything goes wrong. He will take care of us, and if he can't, I know that he'll get us to the right place.

Lee Lewis: So if anything bad happens, I know where to go. That struck me because I live in a world of everybody needs to be in network so that I can go wherever I want. It wasn't what she said. She said, I know where to go if something goes wrong. Second thing she said is, I can afford it. It's affordable and I can get in when I need to.

Lee Lewis: So it's making my list here. It's like affordability, access. It's not a three month wait for five minutes, and it's a relationship of trust. That was when I realized I was grossly overpaid and that what she wants is what we all want. That it doesn't have to be crazy complex. We just need to focus on delivering those basics.

Lee Lewis: And it also taught me that healthcare, if done right, has the power really to impact retention, which we take for granted that it doesn't. At one point in my consulting career, an executive stood up and said, ah, benefits, they're not that important. In the scheme of talent management and human capital, because he said, how many of you took your job because of the benefits and how many of you're only staying because of the benefits?

Lee Lewis: And nobody raised their hand. It was a big group, and it was kind of a chuckle. And I said, see, you know, don't take yourself too seriously. And I said, no. This means that we're all sucking, like we're doing a terrible job. If we're dedicating our lives to helping people save theirs and not a single person with whom we interact gives by flying crap about what we're offering, that it doesn't impact them at all in taking or leaving a job.

Lee Lewis: That's just an indictment on us, not an indictment on the subject matter subject. It means we're not delivering something that's great and we need to deliver something great. And if we do. That's what that ride taught me in 2018, is that if you deliver something that is personal filled with trust, that helps people to feel like they're safe in a world that's scary, that's enough to move the entire kind of human capital needle.

Lee Lewis: I. 

Sasha Yamaguchi: Wow. What a great way to wrap up our conversation. I couldn't agree with you more. I mean, the idea is we want members to feel positive when interacting with their healthcare experience. It's a possibility. It really is. Thank you for that. I love that ending there and the passion around it. 'cause I think it's so important as we help employers deliver that experience to their employees and their dependents.

Lee Lewis: My pleasure. Thank you. And couldn't agree more I. We're very fortunate. We're very lucky to be able to work in a space on a major problem that affects millions of families in a very deep and meaningful way, and that's a big mission and a big obligation, and we're lucky to be able to have it. 

Sasha Yamaguchi: Yeah. Well, that's wonderful and, and I think also anyone listening or getting into our industry that's new in their career, not everybody chooses healthcare or they happen to start in our industry, but I really feel passionate about having people want to work in this industry and do what we do and want to work at A TPA because you can help deliver a good experience and make.

Sasha Yamaguchi: Healthcare in general, not be this scary complex thing and feel like it's a positive experience. So Lee, thank you so much for joining me. I would love for you to spend a minute, just share with everyone where they can find you, would love for you to share a little bit about your own podcast. And again, really thankful for you to be on.

Lee Lewis: Yeah, no, my pleasure. Again, Lee Lewis. Super easy to find me on LinkedIn. Just message me or click through or connect with me there. I'm also the host of the Broken Benefits Podcast where I have the chance to interview people who have made a big impact on the industry. So usually benefits leaders from major companies that have had an impact on the industry and and done interesting things, interview 'em in order to learn and help other people to be able to follow.

Sasha Yamaguchi: That's great. Well, thank you everyone. Please check out Lee's podcast and thanks for joining us today. And Lee, thank you so much again. 

Lee Lewis: Thank you. I appreciate it, Sasha. 

Producer: This podcast is brought to you by Collective Health, a health benefits solution that guides employees toward healthier lives and companies toward healthier bottom lines.

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