DGTL Voices with Ed Marx - Revolutionizing Healthcare with AI (ft Marco DeMello)

Episode Date: March 26, 2025

On this episode of DGTL Voices, Ed interviews Marco DeMello, a successful entrepreneur and CEO of LifeMed.ai. They discuss Marco's eclectic musical influences, his journey from Brazil to the United States, and his groundbreaking work at Microsoft, particularly with Hotmail. Marco shares insights into his current venture, LifeMed.ai, which aims to revolutionize healthcare payments using AI technology. He emphasizes the importance and the need for systemic change in the healthcare industry. The conversation also touches on Marco's personal passions, including scuba diving, and concludes with his vision for a more efficient and equitable healthcare system. Lifemed | AI-powered Medical Solutions, Recover the Unrecoverable Bio: Microsoft executive for 10+ years, where he acquired, scaled and launched Hotmail, restructured Windows security, and secured 36 patents on cryptography and high scale computing. Was founder and CEO of PSafe, the largest private cybersecurity company in LatAm. CEO, CTO and co-Chair of Lifemed.ai, where de designed and led the development and now scaled deployment of DeepClaim AI, a neural network dedicated to help hospital systems increase revenues, accelerate cashflow, and reduce costs while recovering every dollar their due for their services from Insurance Providers.

Thanks for tuning to Digital Voices Podcast, where we chat digital transformation, challenges and opportunities across healthcare and life sciences. And now, your host, Ed Marks. Hey, everyone, Ed here. Welcome to another edition of Digital Voices. Thank you for making us top 10 on Apple Podcasts as of this time of recording. We really appreciate everyone listening. And as always, there's no commercials, there's no ads. There's no sponsors.

It's just pure content. And today I have my friend Marco DeMello. Marco, welcome to Digital Voices. Thank you, Ed. Glad to be here. Yeah, this is going to be fun. We first met through a mutual friend of ours and someone who I had worked with for many years. And so he's like, oh, you've got to meet this interesting CEO.

And I'm always loving to meet CEOs and entrepreneurs and people that have done some pretty amazing things in their career. And you certainly fit that bill. So Marco, we're super happy to have you with us. And the very first question we always ask are what are the songs on your playlist? What kind of music do you like to listen to? So I really love music. I have kind of an eclectic taste.

You know, classic rock like Queen, Bon Jovi and Journey. And then also EDM, I love house and electronic music, you know, DVLM, Dimitri Begis. I'm like Mike. I'm a huge fan of them. And obviously classical music, which is the best music ever invented and ever created. And so I'm a huge fan of Mozart and Beethoven and Tchaikovsky. Those are my favorites. But, you know, I go everywhere with classical music, which I really, really love.

Now, we're going to jump ahead a little bit because I just want to come back to the music. And I know that you're from a different country. So share with us what country you're from because I want to come back to some of the music of your country. Yeah, absolutely. I grew up in Brazil. I was born and raised in Rio de Janeiro. So I grew up listening to a lot of samba and bosanova, which I also love, which I unfortunately neglected to mention on my eclectic sort of like playlist.

But yes, my brother is a musician. he lives in New York. He recorded Bosanova with the greatest of all time and has a studio today in Manhattan. So I grew up, you know, influenced by music and really, you know, became very enamored with it. And it kind of drives my way of thinking and it helps me concentrate and helps me focus a lot.

But, yes, so growing up in Brazil. Growing up in Brazil was interesting. And going to technology in Brazil in the late 70s when I was still a kid was very interesting. and very difficult. And that's where Star Wars comes in. So I was hugely influenced by George Lucas and Lucasfilm. And sort of the whole universe going to draw me into the study of physics and math and technology.

And I started coding when I was nine years old and became passionate about, you know, logic and coding and math and never looked back. So I've been sort of addicted to the world of technology and coding, in particular in physics, since then forever. No, I love that. That's super interesting. I am also a big Bosanova fan and Samba. And so that's why I was asking. I was hoping you'd mention some of my heroes of the day. And I'll have to look up your brother's place when I get back out to New York because I would love to hear some of that music.

When you're in town, let me know, hook you up. He'll take into studios and show, and he recorded with Jean-Juberto, but Belle Juberto, you know, all of the greatest. It's got a huge hit. He has Grammy Awards and so on and so forth. It's really interesting. Wow. Yeah, that's pretty cool.

I don't know. I think my fascination with that era and that music probably came from my dad, right? Listening to Sinatra and some of the jazz, you know, from America. And, of course, then Stan Gets goes down to Brazil, hooks up with some of those musicians you mentioned. Basanova is created. It's just amazing music. I love it so much. So that's pretty cool.

So how did you make your way to the United States? So it's interesting. I graduated from computer science. And my dream, because of all the influence of America. culture and the fact that I love coding and that, you know, technology was really at the time, US, that was it. There was nowhere else to go. So I applied and I was approved to a scholarship at MIT and I went to Boston to live

with my sister, who was already living in Boston at the time, and to go to MIT for my postgrad. And what happened was a sequence of events that I ended up getting offered a job at a technology consulting firm, a British firm in Massachusetts at the time. I joined that firm while I was getting my post-grad at MIT, and one thing led to another, I ended up creating a proprietary J-Pag protocol for the 1996 Olympic Games in Atlanta to allow, for the first time, fans and athletes to communicate over a camera on dial-up internet. So that proprietary J-Pag protocol that never existed before allowed fans and athletes to communicate in the villa with dial-up internet. And it was a huge hit.

It was, I saw interview by the Boston Globe. It got a lot of coverage of that project. then Microsoft called me, literally found me. And then they made me an offer I couldn't refuse. And then that was the beginning of my real career in technology was when I joined Bill Gates in Redmond and Microsoft and crew in 1996. And that's when I had the opportunity to effectively write off the bat two weeks into the job given the challenge of creating free email for the whole world.

And that was Bill Gates asked me to do. I wanted to go offer a solution on Microsoft. technology, free mail for the planet. And the first answer I gave him and was like, well, I can do that, but not on Microsoft technology, which got me fired on my first meeting. But, you know, I wasn't actually fired because he didn't let me be fired. So I was told to solve the problem then and come up with the proposal. And the proposal was the acquisition and the restruction, re-launching of hotmail,

which was my first project in Microsoft, which I launched in February of 1997. And I ran until it became the ubiquitous internet service, the first ubiquitous internet service on planet when the internet was still largely dialed up and we had to solve a litany of very, very hard challenges to make hot mail what it became, this ubiquitous email system for free for the first time, including cryptography challenges. We had to invent cryptography protocols that didn't exist for the login screen. We had to create hardware that didn't exist. We had to run some microsystem servers at Microsoft was like a total anathema and we had to do it. And so we did everything that we had to do. It was a huge success. And I learned a lot. And, and

and ended up with 36 patents under my name and the United States as a result of the work we did in Hotmail and Windows Security, which ended up helping also a lot of intelligence services, which I can't name, both in U.S. and abroad. And so there are a lot interesting stories under that. It's something we may talk about, some events that were quite peculiar. But, you know, Microsoft was the best learning experience

those 10 years I could possibly ever have hoped for. And, you know, Bill Gates paid for my citizenship. He paid for my MBA, and he rewarded handsomely for all the successes that we drove in that company. So I'm eternally grateful to him. Yeah, no, I know it's pretty spectacular. I know you've done other remarkable things since then. So I want to take us up to lifemed.a.I., which you and I have connected over previously.

So you get this great education. You take on these very complex challenges. And so with LifeMed AI, maybe the most complex challenges to date. Tell us a little bit about your company and the challenge that you're taking on. Yeah, so Life Man is an interesting thing. So it's an AI company that was built from the ground up. We started this three and a half years ago. And the whole purpose of this company is to help hospital systems get paid for their claims

and to help balance the playing field between providers of health care and payers of health care. So today there's this huge disparity where hospitals are literally going bankrupt left and right in the United States because they can't get paid. doctors and hospitals and protectioners and hospital systems are simply not getting paid. The denial rates by AI systems on the insurance side, algorithmic denials have skyrocketed since COVID, and there has been no response, no structured response by the hospital system of the provider. So that's what deep claim our AI system inside LifeMed AI, which is a neural network built from scratch on traditional machine learning systems. It does not use generative.

It's a traditional machine learning neural network using contextual AI. to do deep analysis of payer behavior with every single hospital we engage with. And then we effectively interface with their system, with the MR systems, with the clearing house systems, two points of interface, and we start working for the hospitals. And lo and behold, we start getting them paid exactly what they need to get paid by reversing the algorithm of denials from the payers. All the Byzantine mechanisms they use and they hide inside denials, RAI can find it all. It can shine a light on all those denies and reverse them very quickly.

So to give an example, we have clients today that used to get paid in 30, 60, 90 days after fighting payers over and over and over. We get the same claim paid in eight days, eight days. REI can get payment back to the hospitals in eight to nine days on average, whereas usually it would take 30, 60, 90 days, or sometimes never. They simply will never get paid for their claim. So we are taking on the challenge of balancing the health care system, eliminating waste, and increasing efficiency.

So everybody gets paid what they need to pay, not a cent more, not a cent less. But yes, they do get paid. And all the ways that's in the system gets eliminated because you don't need to have so many people touching a medical claim that the AI is perfectly capable of adjudicating these systems, these claims, and getting people paid what they need to get paid

and not a cent more or less. And so it is a job for an AI. It's no longer a job for humans. And I think it's high time that companies like ours would show up and solve this problem for good permanently. Yeah, no, it's super interesting because as a board member of some hospitals, I see that I hear about this all the time. And then, you know, I was in the C suite of other hospitals prior to these board positions.

And this was always, you know, a source of great frustration was, you know, providing great care to members and patients and then not getting paid. And sometimes, yeah, it was definitely our fault because we didn't have a clean claim of some sort. but other times it just felt like, you know, there was some sort of unfair advantage going on. So this sort of levels that playing field. It sounds pretty remarkable.

How have you had some customers to date and how has their experience been? Yeah, we have. We have, you know, several dozen customers already. In fact, in the first year that we've been into production and growing very, very fast, recovered tens and tens of millions of dollars to our hospital clients. our average impact on hospital revenue

goes from 16 to 27% on average more revenue. Let us sink in for a second. A hospital making 16 to 27% more money than they were making on average is the difference between going bankrupt and being profitable. And so it is a huge impact. And sometimes when I call these numbers, people say, this is impossible.

You're just tripping. This is complete BS. There's no way. And I'm like, okay, let us do an analysis for you. and we will integrate with your system. We were run for you for free. We won't charge you a dying for 90 days. At the end of 90 days, you tell me

if the impact we quoted is true or not. And if it is, you start paying us. And if not, we'll go away and there's no contract. That's how we play. We're basically telling clients, we're here to make you money. And if we're not a net positive, I don't want to get paid.

So we're all in. We're all in with you. If we don't have a net positive impact on your revenue, I don't want to get paid because hospitals can't bear any more cost. So we will not be a cost. We're here to be a net positive. Give me 90 days to show you how much my AI can improve your revenue.

And at the end of 90 days, you make a decision. And you tell me if it's worth it to keep the system or not. And if it's not, there's no contract. There's no obligation. There's no cost to. So it's that simple. And that's how we're able to secure customers and grow. And this year, 2025 for us is all the growth, growth, growth, and solving this problem.

There's 435 rural hospitals in America about to go bankrupt. That's a travesty, and it's a tragedy. We're going to prevent that. We're going to work with the government, with these state governors. We're going to work directly, creating a coalition of these hospitals, and we're going to prevent that from happening because there's no need for that to happen. It's just waste and inefficiencies and greed in a system that can be eliminated by putting an AI in there like ours that's going to level the spleen field and get people paid what they're due. Full stop. All right.

So, Marco, so it sounds, you know, pretty amazing, too good to be true type of thing. How do you think the payers, if it's true that there's some nefarious players and they purposely try to delay payment, things like that, what do you think their response would be if suddenly their hospitals that are submitting these claims and they've had their way with them are suddenly much more efficient? Do you think the payers will respond in some way? It's interesting. That question is an excellent question. So first of all, the payers went all in with their algorithmic denial systems and adjudication systems, right? And the party was awesome until now. But now, how do they back paddle from on that and turn off all the systems that have been making them so much in terms of the knives, right? Now, our AI is able to convince their AI to pay. And what are they going to do, turn off their systems and say, oh, that was a bad idea. Let's go back to Junekis manually.

No, they can't afford to do that. Second, payers are limited by 15% maximum profit margin by law. So they're regulated to 15% profit maximum. And so in essence, they're in a sense. They're in the situation where there's nothing they can do. They have to pay what's supposed to be paid. There's a lot of gains that are played here, are shell companies to divert profits elsewhere, blah, blah,

but at the end of the day, turning their systems off because RAI is very capable of convincing their systems to pay is no longer an option. Backing off from this is going to be more painful than actually paying what they're supposed to pay, which by law they have to pay anyway. So it's a bit about like, you know, damned if you do, them if you don't.

I don't think they have an answer to this. Yeah. That's super interesting. It's going to be really interesting to watch. We'll put in the show notes because I'm sure people will be super interested about the product and just seeing, you know, maybe checking back with you in a few months and just seeing how things are going. It's super interesting. Now, Marco, you're incredibly successful individual. If you were going back to Rio and back to your high school and giving the commencement speech, what's one or two things you would exhort the young people about for the future, you know, in terms of leadership or career, those sort of things? Those are very difficult questions, but also very good to make you reflect upon your own history. I would say, first of all, ideas are plentiful, but execution is the key to success. So learn the difference between focus and randomization and stick to focus and learn discipline in execution. Point number one. And point number two, hire always people that are smarter than you and then be their partner. I never had an employee in my companies.

I don't have employees. I have partners. I have people that work with me, not for me. And I provide leadership by giving them vision. So if you're building a business, you want to be an entrepreneur. Understand that rule number one is knowing how to articulate your vision clearly, communicate very, very openly and clearly to your partners and people that are working with you to build that dream into a success.

And then treat them as such every single day, listen to them, hear them, and listen to them and take their feedback and act on that feedback because people don't need a boss. They need a leader. And being a leader is vastly different than being a boss. And I never wanted to be and ever would be a boss. I like being a leader, being seen as a leader and working as a leader. But only with people who recognize that and are capable of giving that feedback and telling me, open like, I disagree and this is why, and this is stupid and this is why.

And let's do this way and then do it that way. So empower those people that are smarter than you to be their best. and your dreams will become reality. But if you insist on being sort of like a king of a fiefdom of building a little empire, that's not how you succeed. You don't succeed by ordering people around. You succeed by inspiring people and leading them to do their best work. At the end of the day, that's what it is.

And that's what I've learned a hard way. Yeah, Marco, I asked you for one or two things. I think he just gave us like nine or ten. It was good. Sorry. It's a stream of consciousness. Just come down. No, I was furiously taking notes.

This is why people, this is why we're number nine in podcasts. So it's all good. Yeah, what is, you just mentioned, you know, the hard way, is, did you have a failure along the way? And if you did, what did you learn from the failure? I learned that you can only be betrayed by the people you trust. And in my case, I was betrayed by an investor. And it was a very hard lesson on how to handle investors and capital raising and the actual

motivations of investors when they put money into your business. And this is something I never expected to be an issue. Frankly, I did not expect, didn't see this coming from 10,000 miles away. And we were sabotaged by our own investor, believe it or not. So it was very ugly and it was very painful. It was a very hard phase that I had to go through and was a very hard lesson. But now I know better and I know exactly how to protect my partners and my teams and my companies from that kind of situation.

And I encourage every entrepreneur to be extremely cautious about raising capital and how and when, why you do and who you do it from and understand their motivations very deeply because this can come back to bite your big time. Yeah, that's very profound. So you have all the success. You do a lot of great things, have great teams. How do you recharge and refresh? So what do you do like for downtime to just, you know, sort of peace out? I am an avid scuba diver, and I travel the world with my professional camera rig underwater for thought. which is my hobby,

filming and photographing, Pelagic underwater life. So my hobby is being underwater in the quiet of the ocean and in total silence and filming and watching life underwater on the planet. That should be called Planet Water, not Planet Earth, which is 75% ocean. And so if you want to see alien life, don't look at the stars, just dive.

You're going to find plenty of aliens underwater. It's a festival of the most beautiful, diverse, and crazily like, challenging to understand life forms. And that's my passion. I love diving and I think I will die underwater. What is your favorite dive? Like if someone's listening and they're like,

oh, I want to do some diving. Where would you recommend? You know, having a favorite, it's very difficult. I would say if I had to pick one spot, definitely the Maldives would be where you have the most concentration of pelagic life in the shortest amount of days you need to cover from sharks to whale, sharks to dolphins to mantar rays to you know spotted rays to barracudas everything you can possibly

imagine of diversity and volume and quantity and schools of fish of gray colors and the Maldives is amazing in terms of coral life definitely the the red sea the red sea in Egypt where I went diving in Dhab and Charlotte Sheikh was for coral life was absolutely the richest the most beautiful but you know Bahamas right here in the coast of Florida it's it's It's a very close second. I mean, I think my best sharp dives and my best shark encounters were in the Bahamas. I went into a blue hole with 2,000 bull sharks. And literally, I was there by myself with 2,000 bull sharks, filming them for five minutes,

went out of the blue hole alive in one piece. And even the guy, the dive master, refused to go into the hole because he knew what was in there. I went in and came back alive, and the guy was shaking his hand going like, you're nuts. And I have this film and I watch it all the time because it was so beautiful, so peaceful. And they didn't want to eat me. They just wanted to swim around and it was fine. Yeah, next time we're together, Marco, you have to show me some of the videos. It sounds like really intriguing and that sounds pretty cool.

So we covered a lot of ground here. Everything from Basanova and Samba to the way you grew up and how you got into Star Wars being sort of a catalyst and getting into technology, how you made your way to United States and MIT. and then had these great opportunities, including at Microsoft and doing a lot of invention, and then building various startups, being part of various groups, doing really good things. Then you left us with a lot of ideas around leadership. We went in-depth into LifeMed, AI specifically about helping hospitals maximize their claims and having a fighting chance against payers.

Is there something we missed or anything you want to double down on? I'll give you the last word. Well, I would say for sure we have a very serious. crisis in health care in United States today. It's 18% of our GDP. It's $8 trillion a year. It is an endemic disaster that needs fixing. And I think today we have the world with all. We have the technology to solve this problem and to reduce this waste and to make health care better, more affordable, more accessible to everyone. At the end of the day, it's about saving more lives, is giving doctors and nurses and hospitals more beds to treat more people and not having to

waste time thinking about whether they're going to get paid. Now, hospitals should, be worrying about payroll. It should be worried about saving lives. And so I want to double down on this deep passion I have as a citizen and as a person to solve this problem, to attack this problem from the top down, working with the federal government, working with every hospital system we touch to really address this holistically and solve this problem once in for all. It's unacceptable that in 2025, the number one richest country in the world has a sick, broken system that doesn't work for almost anyone and the way it should be. And it's not the way, it doesn't need to be. Everybody thinks it is this way because it's always been this way. No,

no, no. This is fixable, imminently fixable. And we're here to work on fixing that. And I'm proud to be doing this, to be moving the needle. I don't need to work anymore. I work because I believe in this mission and in this work that I'm doing. Hey, Marco, I appreciate your passion. I appreciate your articulation of a problem and how to solve it. But I also appreciate you as a person and all the leadership gifts that you left us with. Thank you for being a guest on Digital Voices. It's been my pleasure. Very nice talking to you.

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