The top 10% of patients account for 65.9% of all healthcare spending. These patients are disproportionately served by Medicare and Medicaid.
Two-thirds of hospitals operate at a loss on Medicare. The system stays solvent because hospitals charge private insurers 2-3x Medicare rates to cover the gap. Private insurance is the cross-subsidy.
This creates an arms race: providers code aggressively to maximize private revenue, payers add more barriers to slow the bleed, providers hire more admin to fight the barriers. 34 cents of every dollar goes to running this cycle.
Prior authorizations, denial workflows, appeals processes, payer-specific rules — these are not quality measures. They are speedbumps designed to create attrition. A denied claim that never gets appealed is money the payer keeps.
The denials are not clinically justified — they are friction. The friction works because humans are slow and expensive to throw at the problem.
Physicians process 39 prior auth requests per week, burning 13 staff hours per physician. 93% say it delays care. 27% report it has caused a serious adverse event for a patient.
CMS pays below cost. $130B annual shortfall. 67% of hospitals lose money on Medicare.
82% of appeals win. 88% are never filed. Payers weaponize process complexity.
Independent hospitals pay 57% more for compliance than system-affiliated. $739M/yr in healthcare lobbying.
Large health systems brute-force the maze with headcount. Dedicated rev cycle teams, coding departments, compliance officers. They have built their own maze-running infrastructure.
Small to midsized providers cannot. A 5-provider behavioral health clinic faces the same payer complexity as a 500-bed hospital system — without the resources to absorb it.
Independent hospitals pay $8M/year in compliance costs vs. $5.1M for system-affiliated hospitals. Rural hospitals spend 18% more on administrative salaries than urban ones. Every new regulatory framework adds to this fixed cost.
The administrative burden is disproportionately destructive at this scale. And these are the providers serving the hardest populations.
Every dollar of administrative waste, every delayed authorization, every unfiled appeal — it all terminates at the person who is already sick. Providers pass forward what they cannot absorb: higher prices, narrower networks, longer waits.
93% of physicians say prior auth delays care. 27% report it has caused a serious adverse event. These are patients who got worse while paperwork moved through a queue.
The system asks the sickest people in the country to become their own claims administrators. Navigate the appeal. Call the insurance company. Follow up in 7-10 business days. Do this while you are in treatment, in pain, or in crisis.
In behavioral health — where we operate — the burden is amplified. Substance use disorder, depression, PTSD: conditions that directly impair the executive function required to navigate complex systems. Every gap in administrative continuity is an opportunity for relapse. Every relapse restarts the cycle of admissions, claims, and denials.
The financial toll compounds the clinical one. Patients in early recovery who face unexpected bills or coverage gaps hit a stress trigger that directly undermines their treatment.
Providers are leaving billions on the table — not because they delivered the wrong care, but because the process is too expensive to execute perfectly. 82% of appeals succeed. 88% are never filed. That is not a clinical problem. It is an operational one.
Solve the operations and the money follows. Better margins for providers. Better outcomes for patients. Less time in the maze, more time in the clinic.