a16z Podcast - a16z Podcast: The Infrastructure of Total Health

Episode Date: December 21, 2018

with Bernard J. Tyson (@bernardjtyson) and Ben Horowitz (@bhorowitz) Bernard J. Tyson is the chairman and CEO of Kaiser Permanente, a $73 billion non-profit health organization that provides healthcare and coverage with more than 22,000 physicians caring for more than 12.2 million members across 9 states. In  this conversion with a16z co-founder and general partner Ben Horowitz -- which originally took place at a16z's annual innovation summit, which focuses on building the future and included an entire theme focused on bio and healthcare -- Tyson shares his thoughts on the state of healthcare today and where it might be going. How does an end-to-end healthcare system (like Kaiser's) work in terms of assuming risk and responsibilities, while also maximizing value and lifetime care over a “head in the bed”? What's the impact of -- and challenges in adopting -- technology in healthcare today? And finally, how does one strike a balance between affordability, quality, and lifetime care... and between innovating and addressing immediate needs? All this and more in this episode. The views expressed here are those of the individual AH Capital Management, L.L.C. (“a16z”) personnel quoted and are not the views of a16z or its affiliates. Certain information contained in here has been obtained from third-party sources, including from portfolio companies of funds managed by a16z. While taken from sources believed to be reliable, a16z has not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. This content is provided for informational purposes only, and should not be relied upon as legal, business, investment, or tax advice. You should consult your own advisers as to those matters. References to any securities or digital assets are for illustrative purposes only, and do not constitute an investment recommendation or offer to provide investment advisory services. Furthermore, this content is not directed at nor intended for use by any investors or prospective investors, and may not under any circumstances be relied upon when making a decision to invest in any fund managed by a16z. (An offering to invest in an a16z fund will be made only by the private placement memorandum, subscription agreement, and other relevant documentation of any such fund and should be read in their entirety.) Any investments or portfolio companies mentioned, referred to, or described are not representative of all investments in vehicles managed by a16z, and there can be no assurance that the investments will be profitable or that other investments made in the future will have similar characteristics or results. A list of investments made by funds managed by Andreessen Horowitz (excluding investments and certain publicly traded cryptocurrencies/ digital assets for which the issuer has not provided permission for a16z to disclose publicly) is available at https://a16z.com/investments/. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. Please see https://a16z.com/disclosures for additional important information.

The content here is for informational purposes only, should not be taken as legal business tax or investment advice or be used to evaluate any investment or security and is not directed at any investors or potential investors in any A16Z fund. For more details, please see A16Z.com slash disclosures. Hi and welcome to the A16Z podcast. In this episode, recorded at the A16Z annual summit event, co-founder and general partner Ben Horowitz talked to CEO of Kaiser Permanente, Bernard Jay Tyson, all about the state of health care and where it might be going. The conversation covers how an end-to-end healthcare system like Kaiser works in terms of assuming risk, responsibilities,

maximizing value and lifetime care over ahead in the bed, and the infrastructure that delivers on total health. What is the healthcare infrastructure we need most today, and what does truly affordable health care look like? And finally, what is the impact of technology on health care and where are the challenges in deploying the newest technologies into the modern health care system? All right. So this is Bernard.

Bernard runs Kaiser Permanente, which has 12.3 million members, the largest healthcare provider in the United States. He's also is kind of one of the best CEOs that I know. So, you know, CEOs, kind of studying CEOs is my hobby. And Bernard is one of the best of those. So we'll get into all of that today. Welcome, Bernard.

Wow, I'm scared to say something now. Why don't we start off with a little bit about you? How'd you get into health care? How'd you get to Kaiser and, you know, kind of rise to be CEO? Like many families, there was sickness in my family. So my mother, who was still alive and still kicking. Wow. How old is she, man?

It's 85. Good for her. She was sick all the time when we were growing up, and so we spent a lot of time in hospitals. And she had a wonderful, wonderful physician who not only cared about and cared for her, he also showed compassion to us. so I've always wanted to be a doctor I still want to be a doctor

one day we'll open up a medical school we're opening up a medical school in 2020 here in Pasadena I keep hinting I want to be the first student it'll take me forever to get a degree but so far no takers but as I grew up

I then sort of gravitated to the business But one of the things that was an aha moment for me was the whole thought was, in my mind, was that everybody was treated that way. Then I discovered what we talk about today, which is health care disparities, that we were very fortunate. We had someone who was an advocate for my mom and for the family. And I later learned that that's not true.

as a universal statement. And so I have been a strong advocate. And how did you kind of bump into where somebody wasn't getting that kind of care? Well, it was most dramatic when I was in undergraduate studies to become health. At first I wanted to simply be a hospital administrator. That was for me a big deal to be a hospital administrator.

When I was doing internships, and I was working at a particular hospital, and I began to see how people were being treated and the fact that people were coming into the emergency department for emergency care, and I knew that if they had gotten into a physician office upstream, they wouldn't be in the emergency department almost at deaf doors at times. Oh, wow. yeah and so that was a passion and um i probably took more of a liking then to the business side and then i started down that path okay so tell us about uh Kaiser and because Kaiser is very different than how basically almost all other healthcare works in the united states so what is Kaiser Permanente, how does it work? And, you know, why is it different, why is it better in your view? It's, the line of sight for Kaiser Permanente is to be a total end-to-end system. And we talk a lot about taking care of people from birth to end of life. We also talk about the fact that our

building blocks for our organization is different from the rest of the industry in most cases. We assume total responsibility for the total risk of an individual because our financing system is one in which we get paid, a capitated payment for the entire care responsibility of the individual. Secondly, we have all the pieces of the delivery system inside of of the four walls of Kaiser Permanente, whether that's physically there or virtually through the contractual relationships, but in both cases, we still continue to assume the total risk. Right. And the rest of the industry is pretty much still a FIFA service system is based on volume

and some other ingredients. It's piece milled and siloed. And so the easiest way to describe it, I get paid the whole dollar to. to assume the whole responsibility. Right. Many of my competitors get a piece of that dollar, and so they're trying to maximize how much of that dollar can they get. So you take, for example, in my system, we own 39 hospitals. They're not even revenue centers.

They're expense centers. Right, right. If you go to the rest of the world, the revenue is generated by having what we call a head in the bed. Right. And for me, it's no difference with the payment. So you only get paid if the head's in the bed. Right. Which means you might want somebody to be in the hospital.

That's right. Or someone really doesn't need to be in the hospital. Because I have the whole dollar, I've built the infrastructure along the whole continuum. Right. And then our physicians and others can decide the best location that the person should receive care. And the physician is not incented or disincented one way. or the other, so they're not making a choice based on the economics, they're making it based on the best interests of the patient and the efficiency of care.

So you end up at Kaiser, Kaiser then trying to minimize the cost of a patient over their lifetime or maximize their health, whereas the other system is doing a local maximization on what they can get paid for a procedure or a visit. Is that the right way to characterize it? If you look at the distribution of the health care dollars in the industry, number one, the vast majority of the dollars are spent in a couple of areas is spent on chronic care and is spent on the last 30 to 45 days of a person's life. Right.

Right. Great. That's one time I don't need people spending money on me. I'm going to die. If you look at the least amount of money that's being spent is upstream, in prevention. Right. If you come in and you look at my model,

we invest billions of dollars in testing and prevention, prevention for early detection, early diagnosis, early treatment. That's better care upstream to invest, to deal with an issue very early on, then the weight until the issue progress and weakens the body

and costs much more to manage and to maintain. Right. And does it cause you a problem then that you're different than the rest of the industry because when we come in, like we'll see an entrepreneur who might have a diagnostic tool that can be very valuable, but they have trouble finding a business model for it because most people, you know, most insurance companies

don't want you diagnosed or won't pay for a diagnostic. Don't want you diagnosed this to do it, but it won't pay for a diagnostic. you know and then the provider you know isn't a strong advocate for it either because it's not the kind of highest billable thing so it doesn't cross so do you get the best technology that you could given that you're in a system where everybody's got different incentives yes we we fully embrace technology but we also scrutinize technology because we look at it from is it going to enhance quality?

Is it going to improve the service experience? What's the cost factors associated with it? And can we produce a better outcome? And because I have the whole dollar and I have to invest in the infrastructure for care because that's embedded in my financing model, then my incentive is to make the best choice. And so where it really starts to get real, and this is where both my competitors and friendly competitors come in to look at our systems, you know, and I'll make the terms very simple.

We look at this thing called, you know, patient days. And you look at it per given population. And so you hear people say things like we're at 200. 15 commercial days per thousand and we're at you know 1300 for Medicare and all that kind of right well if you come into the Kaiser Permanente system you will see that commercial days are something like 150 per thousand and Medicare is now down to 700 but then what you look at in terms of the stark difference is I have a whole infrastructure at Kaiser Permanente we have a whole infrastructure and so our physicians could have you in the hospital for two days

and then you're ready to go home, there's a whole different set of resources that's going to take care of you when you're at home, right? And so it's a whole continuity of care. And so to the member, it feels seamless because you're going from one setting to the other setting. Right. We believe strongly that within the next five to ten years,

there's a certain percentage of our admissions into the hospital. we're going to be doing in the homes. Right. So you are kind of out front on telemedicine. Why is it that Kaiser has been able to kind of get in front of that faster than the rest of the medical system? You know, what's preventing them from okaying kind of in-home visit, you know, via telemedicine? Well, for us, it's been an evolution. We invested early on in building a comprehensive,

medical record system. Then we, over time, continue to upgrade it to add additional features. And so it became, for us, very functional, clunky at times, but very functional for use for both quality care and also comparing our results across our large system. You take that as the foundation,

then you start to build additional technology, on top of that, then you begin to create a new infrastructure in which you can care for a large segment of the populations around the country virtually and in other ways. And so our members love to use the virtual technology because, number one, they know the physician and care team has all the data right in front of them. Number two, they know who they are. So there's a relationship. And number three, we've built the incentives for making it very easy to use and to understand.

And as you would expect, it's well received by our members in the organization. I don't know anybody likes going to the doctor, so that makes sense. So was the Affordable Care Act a good idea? Yes. And why so? Well, to simplify it, this country decided in the 60s that they were going to take care of two people, two classes of people, the elderly and poor people. Right. And we solidify that pack in America with two massive legislations, Medicare, Medicare and Medicare and Medicaid.

Right. So I tell people all the time, don't get caught up in the name of the Affordable Care Act. It's the 21st century version of the Medicaid approach. And so there are two major pieces to the ACA. It really is around the Affordable Care Act, which really was the added definition to Medicaid to say, we have a whole new class of poor called Working Poor. That is not accommodated in the Medicaid system. system of 1965 because the theory of the Medicaid system back in the 60s where people were really

poor. Right. Right. By the way, Medicare is the other area that we have to take on in this country. When we did Medicare, it was for people 65 and over, and people basically died when they were 65, 66, 67. Yeah. And so we don't have an infrastructure today for the long-term trajectory of how long people are going to be able to live in the future. And those are the most expensive patients. And those are the most expensive patients. Yeah. So we did not do very well as a country in the rollout of the ACA,

but we're going to have a bigger challenge eventually when we take on the rollout of a revised Medicare program. And so the rollout didn't go perfectly, but does it solve those. Does it actually cover the people that Medicaid wasn't covering that need to be covered? Has that kind of gap been filled? For more people today than before we started. And the whole objective was to target the 30 plus, at the time, 30 plus million people who did not have access to the front door of the American health care system. Yeah.

So we're better off, right? The second thing is, and it's important in the rollout, the infrastructure of the bill is really good. It was always known that we needed to add regulation, to regulate it, to achieve the outcomes that it was intended. Okay. That has never happened because one of the biggest lessons that I've learned in being a participant,

And the whole structure of the Affordable Care Act, the rollout of the Affordable Care Act, is a partisan past bill for a major change in this country is not a good thing. Right. And so part of the reason why it stalled is because it was approved by one half, the Democrats, and not supported at all by the Republicans, right? Right. And how much was that the Democrats' fault versus the Republicans' fault versus both? were the Democrats wrong in the way they forced it through? Were the Republicans wrong in the way they reacted? I just stay away from that about whose fault it is.

I'm just saying that in a country where we must have compromise, both parties need to be at the table working on it. Ironically, many parts of the Affordable Care Act was actually modeled after a Republican-led law that passed in Massachusetts. Yeah, Matt Romney. Yeah. Yeah. Yeah.

Yeah. Yeah. Yeah. So you take, for example, the issue about pre-existing conditions. I remember when the law was being written, someone came to us and they asked specifically how we felt about this issue of pre-existing condition. And our response was, duh, you need to have it in there. Yeah. And then the question came back again.

and we said here's the issue so you take yourself you can have anything heart disease cancer you name it if you're in a group of three or more you could go to any insurance company around the country

and you don't have to worry about your pre-existing condition right right but if you're an individual it's covered yeah but if you're an individual the laws were written years and years or years ago that said, if you basically sneezed, the insurer can say you have a re-existing condition we can't cover you.

Because you had, by law, to price it to that individual. And many of the companies said, it's not worth it. It would never work all this kind of stuff. And so if you take now a new class of people in a new insurance pool, which is the ACA,

you can spread that risk across the entire population. Right. Right. Right. Right. So if you had 20 million people you were projected in the ACA, and of the 20 million, about 3 million had pre-existing conditions, you can spread the risk of the 3 million across the entire 20 million. So it was a no-brainer that we needed to do that. That's before you talk about the ethical issues of not covering someone

who really need coverage because they get sick, right? And so the law thought through those kinds of things. It was engineered to create a competitive environment where everyone would compete for the members. The best example of it's working fairly well is in California, where we compete on price, we compete on service, we compete on quality. A bad example is in one of my other states that I won't mention the state where you didn't have the guardrails built up front at the state level. And what are the guardrails that, like, you're talking about? Like, what guardrails do you need to make it work?

We all agree how we're going to compete in the marketplace. The government, the state government, played a critical role in how to convene all of us together to say we want competition, but we want it done in this way that the citizens of California would be the winners, right? And so everyone agreed to the guard rails and the guard rules. And does that prevent, like, people from cherry picking the healthy people and that kind of thing? Because if I went into the market and it really is going to cost me $1,000 to provide the care. And I'm charging $700 because I want to get the business.

And then I take the market and shift it to my direction. And then the next year I lose a lot of money. And then I get out, you've destabilized the entire market. Okay. And the law was written in a way to counteract that. And it used to be called it three R's. And so everybody paid into the insurance, for example. So if there were 10 people, and I had three of the 10, and it turns out because of my model, I had the most expensive three, the market will pay me through this reinsurance more because I have the greater risk. So it was a zero-sum game for all. the people who compete it. Right. And then you've got a market that's behaving in a very different way. Well, if you don't have the government playing the appropriate role to regulate and modulate it

in the right way at the right time, then it goes crazy. And then people start moving in and out. Okay. So it would be interesting to see what happens over the next several years as we continue to work on that piece of the puzzle. But the bigger issue, by the way, is affordability. affordability for the country for the country right so so the ACA has gotten a lot of air time but the real issue is many Americans who are covered cannot afford the additional cost that's on their backs right

for care and they're not covered by the ACA some of them are covered by right so we're going to move more people into the ACA right exactly yeah yeah interesting and so like let's get into that so you know one of the big challenges with health care in the United States, which is somewhat even unique to the United States, is the cost keeps going up and the outcomes don't. They get kind of the same or worse. You know, where does that go? Is there a way to change that dynamic

and start getting kind of more competitive worldwide where other countries spend less and have better health outcomes? Yes. I mean, I think that's the transformation of health care that we need to think about in this country, right? So there are areas where, number one, I would challenge the premise a bit because actually, if you look at some of the data, you would say, well, actually, no, people are now living to 85, 87,

and they were living to 65, 70, 75. So you get that progress. Second thing is you start to ask, well, with that progress, though, what is the quality of life? Right. That's their health span. It's their health span, right? So are they just breathing? Are they functional in people living their lives like they want to live their lives?

And with the new medications, new treatments, new way of catching diseases earlier, you now are seeing over time that functionality is much better now than ever before. But you have a long ways to go when you begin to compare us against some of the other countries who aren't spending nearly as much, but are getting equal, if not in some cases, better outcomes. Which for me leaves to the third thing, which is I think the aha for us and the aha, I think in this country that we need to come to terms with is we've probably outlived the model that we have in place. I mean, the whole health care industry was created, as you know, because a couple of things happened. We figured out how to deal with sanitation and food preparation and all that stuff, and people started living longer.

And as people started living longer. Past 27, right? Past 27, right? And so when people started living longer, stuff started to happen. Very sophisticated term stuff. And we built a hospital, right? Somewhere on earth, there was a hospital. built, we move a lot of people into it, and begin to take care of them. That basically turned

out to be the infrastructure that is still in place today. You now have the big question about what's the definition of health care in the 21st century? And I would say it should not be a sick care system because a big part of our knowledge that we've all known, but for sure we know it now, is that a lot of chronic illnesses that people are dealing with are preventable. And so the question is, do we have a new role in health care that really focuses on the behavior of people and what that does to the health and the well-being and how do we manage that in the new paradigm? Right. And so let's get into that a little bit. So you have said that, you know, health care needs to get out of our lane. So, and you've talked about we have to treat not just the individual,

but the community. And so talk about that and what that means in terms of changing health outcomes and how you treat people outside of the hospital. Yeah, the, you know, we have people using terms like social determinants of health and how do you think about community health and all those things.

And we have historically played a major role in that. But I would say the couple of things are significantly different now, is that, and we used to call it community benefit, and now it's community health. We fully understand now the direct linkage of the community to an individual's health. And we've been at this for a while,

and so it starts to play out with our role in assessing the fundamental infrastructure in communities in which we take care of now 12.3 million people. So is the community deprived of normal things that you would expect? Places to go buy groceries, right? And in many of our communities around the country,

they are deprived of some of the basics like that. So you don't get the stores that delivers the produce that helps towards better health, and you start to see that being replaced with the kind of fast food restaurants that is really bad for hearts and weight and all those other things, and you start to see that shift.

And we now have the kind of collective data where you can see it with obesity and some of the other challenges. If you're living in a community where it's unsafe, you find people confined more to the inside of their homes and less likely to be out in recreations and things like that. And then the third thing that we're working on right now is this whole issue which is the worst of all things

is you don't have a basic shelter over your head and you're going to bed every night on the streets of America. You're very vulnerable to all of the health challenges that we're talking about. Right. And so the question is, what role do we play in making sure that our members and our populations around them

are basically having the right infrastructures that delivers on what we call total health. Got it, got it. And so talk about a little bit the other kind of side of improvement, which is technology, which you've invested a lot in. But those of us in technology world feel like it's not going fast enough in health care.

So what do you think is, the impact of technology on health care how are you using a Kaiser and then what are some of the challenges in deploying some of the new things that might be able to improve outcomes um i think the i think the field is wide open so you don't think we go fast enough no we've got all kinds of stuff coming out and we go home every night tired No, I mean, the challenge we have in health care, there are a couple of days. One, as you and I started this, it's basically building technology on a fragmented system, right? And you and I both know that either that's going to be so dramatic that you just start from a blank sheet of paper.

Yeah. And that's very hard for us in the industry, right? Yes. The second thing is it's a strong culture. It's, you know, working inside of the health care industry, on one hand, it's beautiful because you're talking to and working with some of the most intelligent people on earth, I would argue. And so the intellect is very high and the ownership is deep, right? Right. And so when you're introducing technology, there's a healthy dose of skepticism and there's a fear of the change. Right, right. And that's before you get to making the technology work. Yeah. And so that's a slow progress to get to that next stage. I would say that we're in a different place in Kaiser Permanente because we've been at it so long. And we don't feel like we go fast.

enough, I want to be clear. We still have systems that we've jerry-rigged over the years to get them to talk to each other. And so when we say we're going to implement something that Kaiser Permanente, and we think it's a very easy system to do, and then you get started and you start to learn that we have all these interfaces that we have to create and all this stuff. And because we're an integrated system, that's mission critical. It becomes a very delayed process for us. I think where we are very excited now is that a lot of smart people are creating.

And the final thing is, and you may not like hearing this. One of the things I'm talking about right now inside of Casuale Permanente is I strategically don't support we're just innovating in a corner and I can't scale. right right so that's nice to have it in the corner but i'm looking at the whole system and

so i want to pay for and promote innovation with technology with the sight of how can we scale it and leapfrog as a result of it as opposed to we have a thousand points of light and we have a thousand points of light right i think you know george hw bush quote there i think where you have incredible opportunities is that now as an industry, I think we have come to terms with we got to figure out how to leverage technology for the whole consumer experience. So that's just prime time. And Kaiser Permanente, for example, you know. Before coming down here, I was on the team with my executive team all day. The majority of the time, we were talking about technology. And there are a couple of people on my team. I have a speak-up environment. My

team gets to say whatever they want to say to me. It's based on the theory we live in a great country. You speak your mind, right? Right. Sometimes they talk a little bit too much, but you know, but it's all good. That's the problem to speak up. Yeah, that's the problem to speak up. But one of my executives

rightfully slow said, well, I think we have to be careful on this third line item called strategic investment in technology because it feels like it's too much of the shiny corn or whatever. He's a coin or something. Yeah. You know, and I was a little irritated with it because it clearly was an indirect message to me, right?

But his point was well taken. The point was, let's not set ourselves up where we're going to have people chasing the shiny object. Right. His real point was, Bernard, you're after efficiency and better outcomes for our members with the experience that's really focused on the investments in that direction. Yeah. And we can go faster. And so there's that mindset out there, but it's hard for us, and we're getting much better at it. Well, what are the technologies that you think are imperative that you have to get to,

that you're going to find a way like whatever we do, we're going to get to, you know, whatever it is, understanding our data better or telemedicine or, you know, what are the areas that you're really driving? Telemedicine, no question about it. we just see tremendous opportunities in that direction. I think the AI is a big opportunity, but it has to be focused. Because many organizations right now are chasing the AI and not clear what they're trying to answer, right?

And we've had many debates with, well, is the fundamental opportunity here is to let the data lead the discovery, or do you, you know, for me that's like walking in the wilderness, right? Nothing negative about it. It's just not our approach. We're just trying to figure out how do we take all of this incredible data that we have now and how do we begin to use it to predict the head, right?

And so we should be at a stage now where we know enough and we have enough information that I can predict what would happen if you keep doing this. these three things or these four things. And I want to work on these four things. And in some ways we've done that without all the wrappings of AI in our past. We figured out the importance of not smoking, right? Right.

And really took it on by any means necessary to try to prevent people from smoking because we were very clear about what it was going to cost. Well, we're very clear that obesity calls many of the things that we're dealing with, right? But it's not as clean in terms. terms of how do you address it in an aggressive way like smoking because it's much more complicated yeah it's a it's broader based for sure yeah yeah yeah and there's no warnings on

sugar labels yet exactly and control and everything else yeah taste and yeah no very interesting so what is the state of Kaiser Permanente's data set today because we always you know hear that this huge advantage of china is that they just take the patient data there's no HIPAA, there's no nothing. They can use it, run all the AI against it, diagnose any disease, etc. For your 12.3 million members, like, do you have kind of comprehensive access to the medical records? Can you start doing these large scale longitudinal studies? Can you figure out what causes what? Yeah, I mean, our physicians in the permanency medical group, I mean, we have the, we've always done the research, and we've always used the data for the benefit of our members in patient care

and all that. We have added sensitivity today because everybody is even more concerned about making sure that we're not misusing their data and making sure that we're not using it in ways they didn't authorize us to use it. We're very sensitive to that. That being said, yes, we are becoming much more aggressive. in the use of the data to better understand many of the things that you are talking about.

And the other benefit of our system is we have all the data. And it's great longitudinal data because our members stay with us much longer than any one of my competitors. How long did Kaiser members stay with you? Well, right now on average, about 18 years. Oh, wow.

So, I mean, we can even calculate it. And this is before AI, we can calculate that if a new member joint Kaiser Permanente, if we do all the things right in the first couple of years, we can predict now, forecast, how long they have stayed with us. It's very important in our model and in our value proposition because we invest a lot in all of our new members to understand what's going on with their bodies, to deal with the medication changes.

And so there's a lot of prep work up front, but it pays off. with their health, with their well-being, and with the efficiencies of care. But the longer you keep them, the better they are from a business standpoint. All the way around. I mean, that's the beauty of the model, right?

When it's really working, the economics of it works well over time, and we're not incentivized to maximize profits or anything else like that. So it's tied really to our mission of affordability. Right. And what's your philosophy? in terms of, you know, competitive advantage

versus being open and advancing the world in terms of your data set and then your findings from that data set? Like, do you keep that all to Kaiser? Do you share that? Or how do you think about that? We share it. Because, number one, we are predominantly,

we're a not-for-profit organization. We're 501C3. We get great benefits from that. Number two, we think two things. One, if we stay sharper in strategy, we've turned a corner before our competitors, and if we stay clean on execution, they cannot catch us.

That's our, at least that's our mental working model, right? We're working on right now, we have some of our competitors that are trying to replicate our model, and if you came inside of Kaiser Permanentia, you're here to say something like, and when they knock at the door to tell us that we're here, we'll be gone.

It's energizing, right? Because it's not based on, I'm trying to hide something from you, it's based on we just want to keep getting better. Right. And so if we can enhance the entire industry, then we're serving the bigger purpose, which is what we believe we're here for as well. Right.

It's not just the main. members that we have the privatives of taking care of, we also have a responsibility to the entire community. Right, right. Great. So let's talk about something that you kind of personally have gotten very involved in, and that I think most people don't think about it. The world doesn't understand that well, which is the connection between mental health

issues and physical health issues. Can you tell us a little bit about your philosophy on that and what you believe in why Kaiser Permanente is investing so much, including marketing cases? campaigns and yeah I talk a lot about that one of the things that we

did in the industry and in society is we detached the head from the body and we over time we built a culture around mental health as a

bad thing right And so we had all kinds of negative names for it. We called people bad things that they were, you know, nuts and stupid and all that stuff. We built a whole medical system as an industry where they went through a special door. Right. Mental institutions. Mental institutions.

And we separated the records from the general records. and we put extra laws around to protect them so the world didn't know they had a mental problem. Right. And the work that we're doing is to say, no, we're actually now reattaching the head to the rest of the body. And we're going to force the industry to come to terms with,

number one, the brain is an organ like any other parts of the body. And so now we're very comfortable talking about heart disease. We ought to be as comfortable talking about something that's going on in the brain. The second thing we said was, look, we needed to help lead the parade and how to destigmatize mental health and how to talk about it in a way that people can relate

because guess what? Mental health challenges are in all of our families. It's in our neighborhoods. It's in our churches. It's in our communities. It's something that the majority of people are dealing with in one form or another. And what kind of percentage of the population do you think has a fairly serious or an important mental health condition?

Well, depending on... It's hard to tell. Exactly. It's hard to tell, but depending on the way you're defining it, it can go upwards of 25% of the total population when you talk about should be in treatment or other things to 50, 75% when you add things like everyday stress and stress, anxiety and all the other stuff that we see. as a common practice. And so what we're doing now is redesigning our care delivery where we're

integrating mental health directly into primary care, for example. We are creating different tools for how people who are dealing with anxiety and other issues who are not sick enough that they need to be hospitalized and or

inside of the delivery system, but they need an extension of who I can talk to when I I need to deal with the fact that, you know, at 2 o'clock in the morning, I'm now very tense about what I'm about to go into for the next day or week or month. Right. And so we have been redesigning the whole mental health protocols and our physicians and others that integrates now mental health into the practice of medicine like everything else.

And do you believe that from an economic standpoint, this will actually lead to a better economic outcome because mental and physical health are connected? No, absolutely. Yeah. We did a study in one of our regions and did this for a prolonged period of time and discovered that about 30 plus percent of the members' patients who were coming in for an appointment. when you began to drill down into the questioning, about 30-something percent of those visits in this study was really based on a mental health issue, right? So the person may have called in to say,

look, I need to come in because I'm suffering from back pain and I can't take it anymore. Then in the questioning of how are you sleeping, not well. Right. How many hours you sleep at night, maybe two if I'm lucky. is everything going on in the family? No, really, I'm dealing. You know, all those things that leads to a warm handoff

in having somebody to come in and say, let's talk about some of the other issues that's going on with you because maybe there's some additional things that we can help you with. And you begin that kind of a dialogue, which is much more of our model, right? So right now, one of the beauties of our model, you can come in and see your primary care physician

something that's going on with your knee, she can say, look, I have Dr. Smith down the hall. He's an orthopedic doctor here. He could come in and look at this. He could tell you right away, what's going on. Would you like him to come in? Absolutely, right? Look, I notice you're not sleeping at night

based on what you're telling me. I have a behavior health specialist right down the hall. She can help you understand what you might want to do differently so you can get a good, nice rest. Right. You say, oh, absolutely. Very different.

And you have a mental issue going on. I want you to go to that private door and somebody will see you, and then all of a sudden you being labeled is the perception. Yeah. Well, and if it's available, otherwise they treat you with, you know, the police or prison or something like that is a huge problem. So last question around that, you know, Kaiser is so different. So you can, you know, and you've taken a leadership role

because you are responsible for the whole person. patient and the whole life cycle of the patient for the rest of the system you know a lot of insurance doesn't cover these kinds of issues people you know the number of untreated people the ral regan deinstitutionalized um california on this and created a lot of homeless when he was governor many years ago do you see uh how do you see Kaiser helping the rest of the system understand the better economics about treating mental health as part of health. You know, actually the good news is it's one of the things that we have done is we've been very vocal.

You know, we've spent money on advertising, we talk about it, we invest in it, and then we open our doors for others to come in and take a look at it. And I think that we are seeing the beginnings of a shift in the governments around the country, state-level governments, the nation, and some of the issues that we've been talking about, we are hearing much more from employers

who's dealing with workplace issues of stress management and, you know, absenteeism and all those kind of issues. And we are embracing that with them and saying, let's work together and figuring out what we can do about this. this in the work site and on the workplaces and those kind of things. I think the last area is, most importantly, as our members become more bold and being willing to talk about their life experiences, there's nothing more powerful than the storytelling

that goes along with that, where people are willing to become more open and say, look, This is what I'm dealing with, and here's the help that I can get. And then you have the, you know, the real serious issues of mental health, suicide. We're doing massive studies on suicide to figure out, are there additional things that we can do in the prevention aspect of suicides? I mean, you probably know this. Unfortunately, over 50% of individuals who commit suicide shows no real sign of it. before it happens, right? Right, right, right.

I mean, that is just mind-blowing to think about that. No warning, yeah. No warning. Interesting. Great. Well, thank you so much. This has been, like, a fascinating conversation. I'd like to thank Bernard.

Thank you. Thank you.