February 3, 2025 - Phil Harrison

Jeremy VanderKnyff (00:08) From Proactive MD and MakoRx, this is healthcare explained. I'm Jeremy VanderKnyff Vinay Patel (00:14) and I'm Vinay Patel. Jeremy, I am super excited. We got a legend, a healthcare legend in our midst today. I'm excited to introduce Phil Harrison to our listeners. Phil has worked in the healthcare industry for more years than I have probably been working as a pharmacist. And he has a wealth of knowledge, not only in the employer space. but also as part of health plans and other healthcare organizations that bring a wealth of experience to the table today. So welcome, Phil. We're super excited to have you. Phil Harrison (00:54) Thanks guys, appreciate that. I'm delighted to have been asked to be on your podcast. This is pretty special moment for me. This will be my first. And I've been waiting on this for a while and I'm looking forward to it. whenever you folks want to get ready and go, I'm here. Jeremy VanderKnyff (01:07) Hopefully we won't spoil the experience for you. So Phil, tell us a little bit about yourself. Phil Harrison (01:12) Well, as Vinay said, I've been in the business for what I would call quite some time, more than most are in it now. I did get a degree in risk management. So I'm one of those that found early on in the game that this is kind of what I wanted to do, mainly because I didn't like anything else that I took. So I wound up in risk management to kind of fit my nature. Fairly conservative person. always looking to avoid the major catastrophes in life. If you avoid the big problems, you can make it through the day solving the little problems. And that's, to me, what insurance is. So I started off in the financial planning side. Thought I was going to be a great investor, financial wealth builder for people. And I was a little young, wasn't very good at sales. To me, was either people obviously knew what they needed to do after I spoke with them or they didn't. So I came out of college as a newly minted life insurance agent with some investment skills. Didn't do very well and I was looking around after a couple years and I found a lot of the guys that I used to work with in the financial services business were making bank selling with the carriers. I said, well, if Rob can make that much money selling health insurance, so can I. And so I made the pivot to a small regional health plan that was owned by hospital system. And I kind of cut my teeth on what I would call distribution sales. Me to a broker to their book of business, not me directly to the end purchaser. And I found that as a nice fit for me and kind of what I've been doing for the entirety of my career. So over time, I've worked with several carriers, took a big step up and did a nice stint in the behavioral health and wellness space for about six years and really learned that business and the complications of behavioral health. And then I started down the path of working in smaller and smaller companies into startups and innovation, trying to solve the mystery and the miracles of how can we make everything easier for people to use, easier to understand, more accessible and to lower costs. I if we think about it, health care is no longer cheap. Probably never was. But it's extremely expensive now. you think about what is health insurance, is it really insurance or is it just a funding mechanism to pay claims? And what's happened over the past 10 or 15 years to wealth destruction from families? Where's that money gone? What else could we have done with it? What should we be doing with it? Where's all this new stuff about fiduciary responsibilities coming into play? It's almost like our industry for a long time forgot Vinay Patel (03:29) Mm-hmm. Phil Harrison (03:50) about the health benefits side, that those people have fiduciary responsibilities as well, not just with the 401k money. I mean, you are taking money out of people's pockets. So you kind of got to do the right thing with it. So that's where I am today. I wound up starting at the very beginning, learning the business, learning how it worked, learning how to build product and distribution. And I am now in the fiduciary business and on the compliance side. Jeremy VanderKnyff (04:16) Tell us a little bit, you know, picking up on what you said of you've been in the business a long time. How have you seen the insurance or how has the insurance industry and health insurance changed over the last 30 years or so? If it was ever affordable, as you said, it's not now. What's changed? Phil Harrison (04:35) one way to look at that is how much is the GDP are we now in healthcare? How much of our gross domestic product is being spent on these services and solutions? About 18%. When I got into business, it was closer to six or 7%. So I'll go back to kind of when I started in the... Vinay Patel (04:46) Yeah. Wow. Phil Harrison (04:56) got involved in healthcare late 80s, kind of with my father, my grandfather. And then when I started moving into production as a broker, my father started going to the doctors when I was young, had a heart attack in 1974. And we started spending a lot of time in the hospitals, Emory, Crawford Long, Health Systems. I kind of got an understanding of maneuvering around. It was radically different back then. the time you spent with providers, the conversations you had, the accessibility. Moving forward in the 80s, we kept on going. Dad didn't need to see, he didn't change his health profile. It, know, digressed over time. But I also started picking up responsibilities as a mid-20s in taking my grandfather, who was a World War II veteran, to the VA for his care. Very different experience in my opinion between what I saw my father accessing under private health care or commercial care versus what we are having to go through to access care under the VA. I want to put this out there. I do not place blame on individuals that work for companies or organizations or systems or institutions. Vinay Patel (06:11) Sure. Jeremy VanderKnyff (06:12) Mm-hmm. Phil Harrison (06:12) Things just happen over time where it goes crazy, I believe. People do the best they can, but we're all being moved and forced into making decisions. Sometimes it might not be in the best interest of all stakeholders. So when I started going to the VA, Vinay Patel (06:23) Sure. Phil Harrison (06:26) in my 20s taking my grandfather, we would show up, there would be no appointment. You would walk in the lobby, you'd sign the tablet or whatever it was, a name thing, and you would wait until they would call you. And if they didn't call you that day, you didn't get an appointment that day. And I was like, well, I'm taking time off work. We're up here at 8 a.m. We just sat here from 8 a.m. to 5 and we didn't even get to see anybody. So to me, that was my first experience with a completely government-run healthcare program. And it wasn't the best experience that I've had. And I can only imagine, to me as a young person, that was my formative time in understanding what universal healthcare might look like if we had complete government control of all of our healthcare services. And I didn't quite like it. Vinay Patel (07:17) And then you got to learn the private side of integrated healthcare when you worked at Kaiser Permanente Georgia for eight years. Tell us about how that was different and how that's sort of the anti-government run integrated solution. This is sort of the complete opposite. What was your experience like at Kaiser? What'd you learn? What was some insights or comparisons against, you know, sort of the other side of the spectrum? Phil Harrison (07:41) Well, so when I started working at Kaiser Permanente, I didn't know a lot about health care. OK, I was still fairly young in the health care, my health care experience. I was really intrigued at the Permanente medical group and what they were doing. was everything that I learned from them was about evidence-based care. You know, people use talk about, that's the health plan manual on how to provide care. It's in a book. Well, how else do you keep data? How else do you find factual information and refer back to it to understand what you should or shouldn't be doing for somebody with a certain set of conditions? And to me, that made the most common sense versus a doctor or a physician or somebody trying to recall. Based on their personal experiences, what was the best thing to do for somebody versus evidence-based care? So that's kind of like the whole population care. Wow, we can look at large populations and numbers and go, wow, so for these number of people to have this, this works best for most of them. So try it first. know, least invasive, least costly, if that's the best thing for them. So I learned a lot from the medical group on how they manage care. And look, it's about finite resources at the end of the day. You only have so much money you can spend, so what do you do with it? And how do you allocate that? So from that side, I got that. And also deep into paying the claims and understanding what an encounter was versus a claim versus CPT code versus an authorization. There's all this data, all these words that most people don't understand. And so I got both sides of the table, admin and help plan, and it kind of opened my eyes to how both sides were run. It was very, very informative and I it just helped me understand how things are built differently. Vinay Patel (09:28) so I have some experience with Kaiser. After I finished pharmacy school, I went out to California and I actually did a pharmacy residency in Kaiser Permanente in California. And I know that each division or each region of Kaiser was run differently. so is, you know, the way that I saw Kaiser and we talk a little bit about your comment on evidence-based medicine was it was an integrated solution. You had a one-stop shop where you had an outpatient clinic, had specialists, had dental, you had vision and you had pharmacy, literally all in one building and even sometimes a hospital right next door to that Kaiser. And the as I understood the medical group was all salaried. They didn't have to worry about billing, you know, all the codes out to get revenue for the they still did that they had to do that to get collect from Medicare. They offered their own health plan and it was the usually the lowest cost option in the Phil Harrison (10:03) Mm-hmm. Yep. Vinay Patel (10:22) because it was a, and that was the HMO model that Hillary Care wanted to bring to the country in the late 90s. Is that how Georgia was run as well? Is this integrated model that was supposed to change how healthcare was provided in the South? Phil Harrison (10:38) Great question. it was a little different. So if you think about the structural build of a fully integrated health system, health care, health plan, the cost structure to build a hospital, own a hospital, multiple hospitals in a geography. So there wasn't really possible. I take that back. Possible, not probable. In the terms of the cost structure to build systems. So what the Permanente Medical Group of Georgia did is they were a mixed model. Vinay Patel (10:40) Okay. Yeah. Yeah. Jeremy VanderKnyff (10:52) Yep. Phil Harrison (11:07) where Kaiser Permanente had their own medical offices, but they also contracted with private practice practitioners that understood their care model. So they weren't overly managing these providers. They were contracting with providers who agreed to work within the structure of the Permanente Medical Group's business. Vinay Patel (11:19) Oh, I see. I see. OK. Got it. I see. I see. Phil Harrison (11:30) So we would contract out with the hospitals, contract out with some private practitioners, contract out with some pharmacies and create a network that was large enough so that people had options to either go to a medical office or a private practitioner and be referred to a contracted hospital. Vinay Patel (11:47) Do you think that's why Kaiser failed in Georgia and North Carolina? Phil Harrison (11:52) We're still here? I say we, isn't that funny? I can't get that. Vinay Patel (11:55) That's right, I forget. I'm so sorry. I forget that they moved out of North Carolina, but they are still there in Georgia and Atlanta. Phil Harrison (12:00) Yeah, but I think part of that was the difficulty in the, if you think back what happened in the 90s and early 2000s, it was a open access world, right? Nobody wanted to go through the referral process and direct access to specialists and well, that's another whole conversation we can have, right? Who's directing your care? So their model exists here in Georgia and they've expanded. Vinay Patel (12:09) Yeah. That's Phil Harrison (12:25) more smaller offices around because the Metro Atlanta is now massively huge. So they had just had to keep expanding where the population is growing. Yes, it's both it's a mixed model. Vinay Patel (12:33) And it's still a network model. Yeah. Jeremy VanderKnyff (12:37) And Phil, let's talk about that for a minute, that switch to the open access, the PPO model that we saw in the 90s. It's interesting because we're seeing in some areas a push back toward managed care, right? Whether it's Medicare Advantage programs, public-private partnership. At ProactiveMD, we have some clients that are managed care, HMO-like models. And it's the challenging of patients' perceptions of what that is. Phil Harrison (12:57) Mm-hmm. Jeremy VanderKnyff (13:02) What led to that kind of change in, know, one day the family doctor was the person that you trusted. And, you know, and then with the rise of PPOs, we started seeing that's the guy you don't want to see, right? what you really want to see as the specialist, even if they don't know your name and don't know you from Adam. And what we're finding is in our lens, getting patients back readjusted to that provider-patient relationship is hugely important to that. So from your lens, I guess two questions, what changed as a result of the rise of PPOs to kind of impact that relationship if it's related at all? And number two is what can doctors or patients do to try to reestablish that trust to where these models can be more successful or at least see wider adoption throughout employers and health plans? Phil Harrison (13:55) Yeah, I think this is just me talking folks. I haven't done a tremendous amount of research on this. This is my experience on what I felt and I saw. Over time, what I believe happened was that it became more more difficult for the primary care doctor to get things done back through the insurance company that would enable a patient to migrate through the continuum of care from provider to provider. They get stuck with the pre-off. They get stuck with a denial. They'll get stuck with this and they go back to the doctor. They go, you can't do anything for me. How frustrating. I mean, you go to this doctor who you've given your care to, you paid all this money and the doctor goes, this is what you need to do. And then all of a sudden, a couple of days later, you get back, nah, you can't go there. You can't do that. Or it's too whatever. So you start, you start chipping away at the doctor's authority. Vinay Patel (14:19) Right. Right. And what about the Phil Harrison (14:46) health care decision making authority between that patient and that provider. And so then it's like, if the health plans devalue the relationship with the doctor that much, why can't I just call the specialist and work it out with them? Jeremy VanderKnyff (15:02) That's a great point. Phil Harrison (15:02) So I Vinay Patel (15:03) And the Phil Harrison (15:03) think. Vinay Patel (15:04) time, mean, doctors just less and less and less and less time as the decades went on. They had to see more patients to maintain independence in their practice. Phil Harrison (15:13) So we've changed their financial model, right? We've taken away things from the primary care doctor they can no longer or we no longer want them to do. We've changed the billing. We've changed the access. mean, when I try to currently with a large health system, I can't call my doctor's office. I don't talk to anybody in my doctor's office unless I'm in there in person, even if I to schedule an appointment with them. Jeremy VanderKnyff (15:31) Mm-hmm. Phil Harrison (15:39) So you don't really that we talked about this, you lose that relationship with the provider, you lose that relationship with your specialist because you're being moved around or you are moving around searching for that answer. And come on, we're consumers, but we're not educating consumers when it comes to health services. That's another whole problem that we're dealing with at the individual level. Not only are you trying to, you you have these relationships that are along with air. Jeremy VanderKnyff (15:59) Exactly right. Phil Harrison (16:07) You're going to places and asking for service. You don't even know how much they cost until after it's done. That's another, yeah, that's it. That's where we are today. Vinay Patel (16:14) Yeah. So let's switch gears, Phil. Let's take that context. We talked about VA, we talked about private health care in the late 70s and the experience your father had. And then we talked about integrated care through a network model in Georgia through Kaiser Permanente. And now we come to the fiduciary responsibility that you know a lot about that plant sponsors have this huge responsibility and it's becoming to look, at least from my perspective, correct me if I'm wrong, more like a 401k regulated plan, then it is going to be more the loosey goosey we've seen over the last five to 10 years, given everything that's happened in the landscape just over the last 12 months. What is the responsibility and the context that employers need to have now with this growing fiduciary and compliance responsibility that employers have been put on, particularly by some of the legislation that's come out in last couple of years? Phil Harrison (17:14) Yeah, that's a great question. So here we are today. We can almost look back and be like Nostradamus. If you go back and look at the retirement plan business, almost the exact same thing is happening. And the responsibilities never went away. It's always been fiduciary duties up under ERISA. when you're building something on behalf of someone else that you're taking money from and directing and controlling those assets and making decisions. That's pretty much what a fiduciary is, right? And so it's real simple for me to go, okay, what should I do if I'm a fiduciary? Well, do unto others, is you'd have others do unto you. What would you want somebody to do for you if they were taking money out of your pocket procuring services for your health program? How would you want them to act? Absolutely in your best interest, which is what they're supposed to do. Our industry has made it unbelievably difficult for plan sponsors to truly act in a fiduciary capacity. There's minimal transparency. can go, OK. There's almost a, thoughts are, if you use compliance as a guide, Jeremy VanderKnyff (18:20) How so? Phil Harrison (18:30) Like the CAA, if you use the CAA as a guide, you can extract ROI from what you do for your health plan if you institute what you just learned from those regulations. Vinay Patel (18:41) for our listeners, CAA. Phil Harrison (18:43) Oh, Consolidated Appropriations Act of 2021. All right. Vinay Patel (18:46) There you go. Just so that we bring everyone on the same page with us along for the ride. Phil Harrison (18:51) absolutely. So what does this all mean? mean, so they were always fiduciaries, but they have difficulty being one because, I can give you some examples. We throw the word around transparency a lot in our business. And what does that really mean? To be able to see through things. So can you see through the information you're receiving from your plan providers? in how they're using your dollars, the claims and utilization. So if you have a program, particularly if it's self-funded, and you're not getting your data, I don't know how you can run your program if you're monitoring or measuring what's going on. So that's transparency, giving people the information they need to be able to make a decision. And then you have, you know, Cost structure and contracts, right? So there's gag clauses. Something else we learned about, gag clauses. It sounds kind of gross, right? Gag up. What that means is they are gagging the organization from being able to send you the data by the contract terms that are in your contract. And people are like, why would anybody do that? Well, that's the transparency part. So if you're working with solution providers that have gag clauses in the contract that you execute and sign, They had the right to not give you information, which is a shame because that's outlaw now. But it's only really outlawed at the plan sponsor level because they're supposed to keep those gag clauses out of the contracts even though other organizations can put them in there. Which doesn't make any sense at all. But the onus of being the fiduciary falls on the plan sponsor. So they really need to be looking at the contracts or hiring somebody to look at the contracts for them to make sure they can get their data and information so they can have transparency to do their analysis to make better decisions. It's very frustrating. It's a circular problem. These plan sponsors are stuck in. Jeremy VanderKnyff (20:48) Absolutely. And Phil, what's your view then on some of the health care transparency acts that have come out over the last few years? think there's different layers of the transparency piece. There's the solutions providers. There's the networks and carriers and PBMs. There's also the actual providers, increasingly so in this country, the health systems that own Phil Harrison (21:09) Thank Jeremy VanderKnyff (21:12) and are contracting with the different carriers. How successful or not successful have some of those attempts been to try to promote more transparency to create an educated healthcare consumer base? Phil Harrison (21:24) OK, so I'm going to, this is where the rubber meets the road, right? So how can we help consumers know what the cost of something is before they go access it and use it and get a bill later? Health systems are required to put out these files, MRF files, machine readable files of all the contracts they have, prices and everything. Vinay Patel (21:33) Yeah, right. Phil Harrison (21:46) It's awesome if you can understand it. But again, if we go back to financial and health literacy rates, nobody understands what these things really mean. It's difficult for a consumer to go and actually just find it. don't know what they think they have buried somewhere. So there's some pretty cool organizations out there like Health Cost Labs, Billy, and some other ones out there that have gone out and then taken this information and put it in a format that consumers can use. We are at the Vinay Patel (22:13) Mm-hmm. Phil Harrison (22:15) stage of data. Well, we have data everywhere, but we have data that we can't use. It's sad. So now that we have this tool that we can access data for prices by CPT code at hospitals so that you can actually call up the hospital and say, hey, I'm with so and so. I know my costs are x before I go, which is great. But what's even more important is you can now compare the cost structure. Vinay Patel (22:19) Hmm. Phil Harrison (22:40) up under your plan if you're with a certain PPO network or whatever with other networks and what they're paying and what Medicare is paying in the cash price. So a consumer should be able to, by now, if they understand it, know what their costs are before they go and then make a decision to go there or somewhere else. Based on price. Or if they want to sit there and stay with that provider and negotiate on their own behalf. Think about this. So when we talked about the commercial health plans for a long time ago, we used to have something just called deductible and co-insurance and out of pocket max. That was it. It was beautiful. I was born under a deductible co-insurance plan. My parents had x deductible and they had something called a maximum allowable charge. Vinay Patel (23:21) Yeah, yeah, yeah. Phil Harrison (23:36) So their plan told them how much it would pay for certain services. So they could go to the doctor and say, hey, when we birth our child with you, this is all our insurance company is going to give us. How much are you going to charge us? The negotiations happen right there. We have taken that so far away from people right now. They're not even used to looking for it. But it's there. Vinay Patel (23:56) Mm-hmm. Mm-hmm. Phil Harrison (24:02) People can actually take the data now and go negotiate and make financial decisions on where they want to get their services and what all the options are. And they're radically different. Cost has nothing to do with quality. It just has to do with location. Jeremy VanderKnyff (24:15) I got to ask though, Phil, you know, it's the question of they can go out and negotiate, but should the average health care consumer, the average patient need to be in a position when we think about to your point of fiduciary responsibility, there's theoretically plan sponsors and carriers and networks and providers that should have some degree of advocacy on that patient's behalf. It's obviously a loaded question. the way that I'm phrasing it here, but should it fall down to the responsibility of every individual patient during their time of potentially crisis or a complex health condition, how do we get to the place where they have to advocate for themselves because the other people that they're paying to take care of them maybe have misaligned incentives, shall we say? Phil Harrison (25:00) there we go. So here's this interesting thing. We've come full circle now, because this is the way it always used to be. This was the only way to do it before the HMO Act and things like that. That was just the way it was. So we've enabled and allowed the easy button. I have a copay. I don't care what it costs. So people have been conditioned over time to press the easy button. Right? So now we're going to ask them to do something a little more difficult and they have no skill set. So you're absolutely right, Jeremy. If you are a fiduciary and you have a health program, especially if it's self-funded, you're spending your money and their money. It probably behooves you to have some type of organization that will work with you for your participants on their behalf to help them find and assess quality and value and cost. It's not that expensive. It's expensive when you don't do it. So it's there. So to me as a fiduciary, man, if you know about something, if you learn about something that can potentially help your plan participants save money, make it easier for them, I think it's your duty to just at least look at it, consider it. That's pretty bold. Vinay Patel (25:58) Mm-hmm, yeah, that's right. Jeremy VanderKnyff (25:59) Absolutely. Vinay Patel (26:17) So that is, that is, and it's become abundantly clear from the lawsuits that we have against Wells Fargo and Johnson & Johnson that the decisions, know, someone was asleep at the wheel. the default decisions were for the more expensive treatments or for access to the lower cost treatments, having barriers, so on and so forth, whether it's medical or pharmacy. but pharmacy is of a little easier to connect the dots against. So when you do have this clarity, this transparency to see through all the information and find these areas that are pockets that can help to save, what are the one to three areas that you find when you do have transparency, when there is a fiduciary that's actively engaged and enrolled, engaged in the plan to help? What are some of these areas that you find? One to three areas that you've seen in your work with plant sponsors, where they can save. Interesting. Phil Harrison (27:14) So there's the easiest to the hardest, right? So we start with the lowest hanging fruit. It's got to be the pharmacy piece. Oh my gosh. I mean, from me, from what I see out there, I'm a sales guy and I've never worked in the PBM space. So this is me talking from the outside going, man, it looks pretty easy. You get your data, right? You get your data. You get your claims data on all your pharmacy programs. You do an analysis, right? Jeremy VanderKnyff (27:40) Hmm? Phil Harrison (27:41) There's something that we have going on every year right now called RxDC. You have to file in June. What blows my mind is how few plan sponsors actually look at that document. That document shows you your top 50 medications, your cost for each one. It also shows the rebates and the spread pricing that the PBM kept. So that's what. Vinay Patel (27:51) Mm-hmm. Mm-hmm. Interesting. Yeah. Phil Harrison (28:04) A lot of people don't know that they're making money on that as well, which could be good or bad. I'm not making an accusation here. It's just what it is. And if they're not looking at that, that could be a lot of money or it might not be a lot of money. It could be something they want to negotiate with on. You want to keep three-bates? in my PEPM. You want to give up three-bates? There's a lot of ways to play that, but if they're not even doing it, they've missed half the battle. So to me, Jeremy VanderKnyff (28:25) Mm-hmm. Phil Harrison (28:30) Pharmacy is one of the easier things to look at and extract and replace with a specialty organization. Vinay Patel (28:38) So let's use that example. And you had mentioned when we identify a problem, we find either alternate sourcing or payment models. What's a good next step once you identify this? You have transparency, you're a fiduciary, you're paying attention, you identify this problem as a plan sponsor. Now let's just say the lowest hanging fruit is pharmacy. As you said, you've worked with several plan sponsors on this. What's the action steps? What should they be doing? are two or three things that they should be working on as sort of next action steps after they find these problems? Phil Harrison (29:09) Well, yeah, so there's so many PBM organizations out in the marketplace right now. Their benefit advisor, they need to hire a good benefit advisor that has their interests in mind, right? So we've got to go down another rabbit hole about comp disclosure. That's another conversation. But plan sponsors need to be asking that of their benefit advisor. I started a little channel. sidebar here, but they got to be working with the right person or this is not going to happen. mean, there are contingency fees that sometimes some benefit organizations get by placing business with organizations. Vinay Patel (29:40) Do you? Do you have one golden question they can ask their benefit advisor to determine if they're working with the right person? The only reason I ask this is because we're talking about employers that could be anywhere from 50 employees to 50,000 employees. And we know that the ones that are over 5,000 employees have an army of folks that can help tackle the army of benefit consultants that come and give them information. Phil Harrison (29:53) wow. Vinay Patel (30:13) the probably 60 to 70 % of businesses that are under 5,000 employees likely have one poor benefits professional that has to not only do healthcare, they have to do all the ancillary, they have to manage all the problems that come to them. And it's not to belittle them, I'm just saying they don't have as much resources. And so if we can give them some tools to say, if the action step is make sure you're working with the right person first, What's the golden questions that I need to ask or what can we load them with to say, or here's how you know you're not working with the right person. Some context there for them. That's the only reason I ask this question, not to put you on the spot. Phil Harrison (30:48) Well, okay. No, this is something that, you know, we try to make it simple for people, right? How do you clear through the clutter as fast as you can? Nothing asking about the compensation kind of like puts the puts it right where it is. I mean, how do you get paid? It's fair. We all get asked that question, don't we? Vinay Patel (30:59) Yeah, that's right. Okay. Great. Right? Yeah. Phil Harrison (31:15) I mean, we ought to be proud of how we get paid and why we get paid and how much we get paid and what we're doing for it. So part of where we are today is that there needs to be a realignment on advisor compensation, how many ways they get paid, how it's discussed and shared. And I'm not saying that bonuses or contingencies are all wrong. It depends on how you use them. It depends on what you do with it. And it depends on if it's been disclosed to the purchaser so they can make their own decision on whether or not that influences the broker's decision on where they place their business. If you don't disclose it, you've never given the plan sponsor the opportunity to make a true decision based on all the things that they think are important. Vinay Patel (31:46) Yeah. That's right. Jeremy VanderKnyff (32:02) Do you, do you, you know, we've gone through this with, to your point, retirement, fiduciaries for retirement, where those have to be disclosed, right? Do you see any movement anywhere to require that, the same thing of benefits consultants, benefits professionals, who are, you know, should be compensated to act in the best interests of the plan sponsors they represent versus in the best interest potentially of vendors who surround them. Phil Harrison (32:29) I would like for that to happen. Right now, the onus is purely on the plan sponsors to ask of their solution providers or brokers or whatever to provide their comp. They don't have to. So we're not quite at that they have to provide it. They should. Plan sponsors should at least ask for it. And they're not used to it. You go back to this, look, man, you brought up something that's almost crazy in this world. We've placed people, good people, in roles that they might not be adequately prepared to do. If you think about a benefit manager, an HR person, who's got all this stuff going on in the world, right? And all of sudden, every year they got to deal with all this stuff. What's their background in finances? Vinay Patel (33:15) Yeah, yeah. Phil Harrison (33:16) I mean, do they really understand self-funding? Do they understand the mechanics? I think sometimes plan sponsors or employer groups might do well for themselves if they paid for some of their HR folks to go get some deeper financial training on how health insurance works. What's wrong with an educated consumer? Nothing. Vinay Patel (33:33) Or sometimes these divisions in the health plan are divided among multiple team members. You got the CFO that's responsible for the money of health care. And I don't know if they fully always understand all the details there. And then you got benefits that just make our people happy, make sure we got rich enough benefits to keep them and to recruit folks. And so sometimes it's a multifaceted, it's broken down on their multiple divisions. And then one point on your broker comp, which hopefully may be insightful for our listeners. We'll find out from the comments and feedback that we get. It's not just the person in front of you. The benefits professional in front of you has their compensation. You have to dig a little deeper and ask if the firm that they work with has a different compensation structure because there's now ways around. I can go to the, I can sit at the table as a benefits consultant, tell you with a straight face, I don't get any comp from any of the, any of the vendors I recommend to you. However, my firm may get something. If you don't ask, you'll never find out to understand all the details here. Cause there there's ways around because we put this restriction on the benefits professional. Now they've gotten ways around that. Phil Harrison (34:51) Yeah. Vinay Patel (34:52) to understand if there is any sort of muddling of, you working my best interests? Phil Harrison (34:57) Yeah, and that came up while back with large national broker firms. We've already kind of gone down this path, but I don't think it did much because it's still going on. But those contingency fees on the book of business and retention. So the broker might have 15 cases, but their firm might have 200 cases with a carrier. And so the broker might not see it. Vinay Patel (35:04) Hmm. Hmm. Yeah, that's right. Phil Harrison (35:24) But the firm is. so that's its sticky place right there. So some of that is used for the account management structure to serve there. like I said, not saying they're all wrong. I'm saying that they better be able to explain what they're getting and what they're doing with it. Vinay Patel (35:28) Yeah, that's right. Yeah. Exactly. Jeremy VanderKnyff (35:41) Yeah, it's the transparency and I think that's been Vinay Patel (35:41) Yeah. Phil Harrison (35:42) Yeah, Jeremy VanderKnyff (35:43) the theme, you know that I'm hearing from you Phil throughout this entire conversation is the responsibility should be the Should be on all the players involved to be transparent so that the purchasers of health care whether it's the plan sponsors or their employees the individual consumer have that ability to be able to make the right choice and do their own analysis of What's going to be best for me and my outcomes? Whether it's health outcomes financial outcomes Phil Harrison (35:43) that's all. you . Jeremy VanderKnyff (36:09) and you require that information to do so. Phil Harrison (36:12) Yeah, so without transparency, so there are four kind of big things that you have to do as a fiduciary. So you have duty of care. That's to act reasonably, right? How can you act reasonably if you don't get the data? That's the most unreasonable thing I can think of. Duty of skill. You have to have enough understanding of what you're talking about to make the decision. So that kind of goes back to the training or what kind of help can the... Employer give to their benefit people to understand some of these deeper themes or concepts that all of those innovators bring to the table, right? And duty of prudence, you got to keep up with this stuff. You got to look at it every year. You can't just, you know, buy once and say goodbye. And then diligence, you know. Are you being diligent in the way of your processes? How are you comparing, contrasting and shopping for a new or additional? So Vinay Patel (36:46) concepts. Phil Harrison (37:09) Without transparency, none of that stuff works at all. And that's why I harp on that. It's just frustrating. Vinay Patel (37:12) Yeah, that's right. Jeremy VanderKnyff (37:16) I completely understand. Vinay Patel (37:20) All right, Phil, this has been a tremendously insightful conversation, at least for me personally. I appreciate you sharing all of this information. Jeremy VanderKnyff (37:29) Any last words of wisdom for our listeners, whether they're employers, plan sponsors, individual consumers, what's the one thing that you would want them to leave here from the conversation today? Phil Harrison (37:44) You learn this over time by, you know, butting your head up against the brick wall. You don't know what you don't know, right? You never will unless you start exploring things that are outside your comfort zone. We're all used to doing things and we want to process. We love it when things don't change because we get really good at the process. The healthcare process is a little broken. Go out and learn something new as many times as you can and ask questions. Be curious. You don't know what's going to happen until you start asking questions and learning. And it's liberating. Jeremy VanderKnyff (38:23) love that. Phil, it's been a pleasure to spend these last few minutes talking to you. I know you'll be a delight for our listeners as well. Thank you so much for your time and coming on the show. Phil Harrison (38:35) Thanks, guys. I enjoyed it, and I look forward to the next one, possibly down the road. Jeremy VanderKnyff (38:41) We'd love to have you back. All right, from Proactive MD and MakoRx, this is Healthcare Explained. I'm Jeremy VanderKnyff. We'll see you next time. Vinay Patel (38:47) and I'm Vinay Patel.