Malpractice reform. Tort reform and more specifically, malpractice reform is sorely needed. As of late, there has not been a lot of noise around this issue, though this litigation drives up costs and hampers healthcare delivery on so many levels. One is the additional, often unnecessary, testing and such that many providers must take as part of their defensive medicine strategy. Given the pricing structures at present, this practice leads to higher costs and a greater risk of patient disenfranchisement. Additionally, the risk-reward to bring suit is really tipped in tort attorneys’ favor. If it weren’t so lucrative, there wouldn’t be so many billboards and commercials punctuated with clanging hammers. One easy fix would be to have a losing plaintiff cover the other side’s legal fees. I am not suggesting there isn’t malpractice in the industry; far from it. But there is a difference between bad medicine and bad outcomes.
Michael Dershem, founder and CEO of healthcare payments platform MAPay, has been a serial entrepreneur for more than 20 years, beginning as co-owner of RX Returns, which grew to become the largest pharmaceutical returns company in the nation. Later, Michael was founding CEO of Pharmasset, an Emory University start-up company that raised more than $25 million in private equity funding and executed a $30 million research and development agreement with DuPont. The company has subsequently gone public and was acquired by Gilead Sciences for $11 billion.
Can you share the most interesting story that happened to you since you began leading your company?
Is anyone ever happy about paying a bill — let alone a medical bill? We at MAPay have been doing transactions for more than a year now. One day I got a call from the CEO of a medical billing company. She was instrumental in building our some of our initial MVPs (minimum viable product). In any event, she said she had gotten a call from one of her physician clients, who went on to explain an unusual circumstance that happened in his office. While in the middle of an exam, the patient told the doctor that she was so happy with, of all things, the experience in paying her bill: that it was so easy, and she felt good when she paid it on the website platform that his office uses. He nodded his head and uttered an awkward “thank you” because he had no idea what she was talking about. After hearing this story, Marissa, the CEO of the billing company, just had to tell him about MAPay: about its function and our vision of giving everyone access to secure healthcare transactions around the globe. It was an aha moment for us: we knew then and there that MAPay can build a trusted community of patients alongside their engagement.
Can you tell our readers a bit about why you are an authority in the healthcare field?
I’m a serial entrepreneur with experience primarily in the healthcare and pharmaceutical industries. My career began more than 20 years ago as the co-owner of RX Returns, which grew to become the largest pharmaceutical returns company in the nation. We took care of drugs that were expired, damaged, recalled and made sure they had a proper final disposition so they didn’t end up in the gray market or on beaches and playgrounds. Later on, I worked to build a business platform for the Department of Veterans Affairs that built commercial bridges between them and the private sector. I modeled and executed on some of the first alternative site health clinics in supermarkets and drugstores. As the founding CEO of Pharmasset, an Emory University start-up company, I successfully raised more than $25 million in private equity funding and executed a $30 million research and development agreement with DuPont. The company subsequently has gone public and was acquired by Gilead Sciences for $11 billion in 2011. Today, I am the CEO of MAPay, which offers a useful blockchain-based platform to provide seamless payment platforms for the healthcare sector, which promotes both the clinical and financial well-being of the industry — and ultimately, its end users: providers and patients.
What makes your company stand out? Can you share a story?
The culture that we are building at MAPay is quite special. We have built a can-do attitude with an underlying empathy for all parties with whom we find ourselves engaged and with a business creative business acumen and personality that people have begun to trust. And maybe laugh a few times along the day.
Late last year, a major EHR/PMS vendor asked if we could tee up an end-to-end payment and receipt solution for them. After they heard our technology story in the 11th hour, they knew their legacy vendor was not the solution that would wow their clients. We won the business the last week of the year and were asked to have a full-scale deployment by February 1. We were ready — yet they were not, and they pushed back the implementation until March. In a recent discussion with one of the vendor’s executive decision makers, he remarked, “Although we believed you when you said you could get it done, deep down we really didn’t believe you, but we had hope. We still can’t believe you pulled it off but are extremely glad that you did.” We’ll take that as a thumbs-up.
Can you share with our readers about the innovations that you are bringing to and/or see in the healthcare industry? How do you envision that this might disrupt the status quo? Which “pain point” is this trying to address?
Everyone is aware of the longstanding role of the various stakeholders in healthcare, whether they are providers, insurance companies, financial initiations, third-party administrators, or government entities. MAPay has a distinct value proposition to offer each of these stakeholders. We’re confident of how emerging technologies such as AI, blockchain, and machine learning stand to upend and improve the healthcare industry. The intellectually lazy will be steam rolled. Those entities that deserve to be preserved will be. As we address the financial friction that happens with payments in healthcare both domestically and around the world, some legacy players will be forced to the curb while others adapt to the changing environment that we are driving. Through smart contracts and real-time escrowed adjudication, we will collapse these costs and provide more transparency for all parties.
Tell me your “5 Things I Wish Someone Told Me Before I Started” and why. (Please share a story or example for each.)
As I mentioned earlier, this isn’t my first rodeo. This being said, I think it is interesting that there is still reputational risk as it relates to blockchain-enabled companies.
Also keep in mind a company’s public voice might be much different than its private one. We are working with some healthcare-related institutions that are reluctant to go public with what we are doing, even though it would benefit them to let their customer base know of the dramatic cost reduction and improvements in patient engagement that comes from our services. I always remind people that a business plan is dynamic, not static. I would argue that blind focus can choke a new business. Do you think that back in the 90s, Amazon had on its internal whiteboard same-day delivery by drone? Do you think we had in our initial business plan a full, nationwide deployment of our network? That’s crazy.
To attract talent today, you have to go beyond what’s written on a W-2 or 1099 and offer employees the opportunity to derive purpose from their work. Management needs to understand these motivators and sell employees every day on the promise.
Moreover, on some level, at least, a business has to have a global mindset. Sure, many a successful company has sprung from a local need. But as we see from the cases of Airbnb and Uber, that same solution can have worldwide application. At MAPay, we’re addressing the issue of patient/provider experience during interplanetary travel before Elon Musk or Jeff Bezos jumps on it.
As a service provider, a static offering is not acceptable. In order to achieve mass adoption, you need to build a platform that can plug and play behind the scenes while having a flawless user interface. Organizations are not looking to spend a lot of resources to adapt to an unknown. Yet C-suites still search for vendors to achieve wins yesterday. This being said, one of our client healthcare institutions asked if we could deploy in 60 days. This process can take six months. We committed to 30 days — and with no real extra costs on their end. Puck on the stick…shot, score.
Let’s jump to the main focus of our interview. According to this studycited by Newsweek, the US healthcare system is ranked as the worst among high-income nations. This seems shocking. Can you share with us 3–5 reasons why you think the US is ranked so poorly?
First off, I should start by saying that this study is five years old and appears to have an underlying bias. Taking the question as to how the money spent per capita in the US on healthcare impacts our metrics, I would point out that our healthcare system has fostered many of the biggest innovations in the history of medicine. I believe there are some systemic underpinnings that lead to higher costs such as defensive medicine, no price transparency, and many patients’ lack of access to healthy choices. One question I would ask, though: If your mother or child became very ill; would you seek treatment in the US, as do so many overseas?
You are a “healthcare insider”. If you had the power to make a change, can you share 5 changes that need to be made to improve the overall US healthcare system? Please share a story or example for each.
I would like to see increased competition in every element involved in the care and financial delivery of our healthcare. And I would like to see the patient become more centered and engaged with their healthcare delivery choices and financial obligations/decisions.
Cross-state-border insurance. I believe the allowance of insurance companies to offer policies across state lines would provide further economies, improved risk-pools, spur other competition and ultimately, lower costs. I saw where CMS is trying to find areas that this would comply with the Affordable Care Act (ACA, a.k.a. “Obamacare”). Of course, states would have to approve on their end.
Price transparency for procedures and drugs. Right now, no patient really knows off the bat how much a drug and/or procedure will cost. The current administration is taking strides to provide more transparency. I think this transparency can extend even further by providing this information to consumers in an easy-guided website and app.
Incentives for patients to save money and live healthier. Little real benefit exists for a consumer to make healthier choices and preventative care. Permissionable blockchain grants healthcare consumers the ability to monetize their own data. These rewards don’t always have to be monetary in nature, mind: they could be for altruistic purposes, such as becoming an organ donor. Millennials and Gen Xers can really lead the way on this and mentor up to older family members and associates.
Open up opportunities for affinity groups and associations to pool consumers and negotiate care on behalf of the established group. The idea that healthcare coverage comes from the employer is really a dated means of delivery, especially compared to insurance and coverage practices from around the globe. What other product or service is the responsibility of the employer or government? That said, there are other marketplace ideas that could provide real benefits to cost and coverage. Allowing consumers to enter other pools of the population such as church groups, chambers of commerce or specific buying groups could drive further innovation, competition and provide a bridge for the consumer to engage in their healthcare choices.
Malpractice reform. Tort reform and more specifically, malpractice reform is sorely needed. As of late, there has not been a lot of noise around this issue, though this litigation drives up costs and hampers healthcare delivery on so many levels. One is the additional, often unnecessary, testing and such that many providers must take as part of their defensive medicine strategy. Given the pricing structures at present, this practice leads to higher costs and a greater risk of patient disenfranchisement.
Additionally, the risk-reward to bring suit is really tipped in tort attorneys’ favor. If it weren’t so lucrative, there wouldn’t be so many billboards and commercials punctuated with clanging hammers. One easy fix would be to have a losing plaintiff cover the other side’s legal fees. I am not suggesting there isn’t malpractice in the industry; far from it. But there is a difference between bad medicine and bad outcomes.
Thank you! It’s great to suggest changes, but what specific steps would need to be taken to implement your ideas? What can individuals, corporations, communities and leaders do to help?
Change won’t come easy; however I do think it’s possible. First, I think individuals need to become more engaged with their healthcare. But this cannot be dictated to them from the insurance carrier, government or other institutions. To a large extent, the public has developed a fundamental distrust towards these players. A community that is self-directed by patients for patients would allow for individuals to take steps to achieve better results for themselves and others. Corporations and government need to realize that healthcare needs to be able to evolve. Alongside and in tandem with technology, these players need to provide the business and regulatory framework to allow novel strategies to deployed, drive and thrive.
What are your favorite books, podcasts, or resources that inspire you to be a better healthcare leader? Can you explain why you like them?
I am an avid reader of The Wall Street Journal, which provides the big picture of what’s happening across the globe from a business and economics perspective. It also provides insight on what matters to other CEOs. I often read it online, though I prefer the feel of the paper and ink first thing in the morning over my post-yoga coffee. I must stress, though, that as I mentioned earlier, we need to be mindful of some thought leaders’ public voice versus their private voice. In terms of healthcare and pharma-related content, I also recommend the Becker’s family of healthcare publications, as well as Modern Healthcare.
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