When physicians and hospitals suffer from Stockholm Syndrome
The much discussed -- and deserved -- criticism of the nation's largest healthcare entity and Fortune 5 company, United Health Group, has almost entirely focused on its commercial health insurance arm, United Healthcare.
It was the brazen assassination of United Healthcare's CEO, Brian Thompson, that uncorked a flood of vitriol on social media -- not about the alleged shooter but rather directed against United Healthcare and its history of aggressive claims denials and byzantine prior authorization processes. More criticism followed in response to the tone-deaf remarks, both public and internal, made by UHG's CEO Andrew Witty.
There is much more to the United Health Group Story
Mostly unmentioned and largely ignored in the swirl of public calumny has been Optum, a health services and tech company that is United Health Group's other major subsidiary and the sister services delivery organization to insurer United Healthcare.
Optum is a behemoth with over 90,000 employees, more than $100 billion in annual revenues, and about 44% of United Health Group's profits. Optum's various services are organized around 3 clusters: OptumHealth, OptumInsight, and OptumRx, a pharmacy benefits management firm.
Optum Health is the largest employer of physicians and advanced practice providers in the US at 90,000 and 40,000, respectively, practicing in over 2,700 offices across the country.
Optum Insight owns Change Healthcare, the object of a ransomware attack that resulted in the release of protected health information of over 100 million patients, and created massive cash flow problems for many of the nation's hospitals and physicians that still reverberate today.
Optum Rx is a PBM - managing billions in prescription drug coverage.
Here's what I find deeply ironic: because of low reimbursement rates and high levels of prior authorization and claims management hassles, United Healthcare has played a significant role in making it difficult for physicians to remain in private practice, many of which have then sought financial shelter in the arms of Optum.
On the hospital side, United Healthcare's aggressiveness has caused massive headaches for hospital CFO's and their revenue cycle management teams.
Guess what? Many of those same hospitals that have experienced financial pain because of the combination of United Healthcare's rates and claims practices have -- wait for it -- outsourced their revenue cycle management to Optum. Yup. I guess the logic is: that the same "talent" that contributed to hospitals' financial challenges can be reverse-engineered to help those beleaguered hospitals if they engage Optum to handle their revenue cycle management vis-a-vis all payers.
Stockholm Syndrome comes to mind as the best way to explain the perversity of physicians becoming employed by Optum and of hospitals turning over their revenue cycle management to an affiliate of a despised insurer.
Stockholm Syndrome is not a real diagnosis per se -- one will not find it listed in the Diagnostic and Statistical Manual of Mental Disorders (DSM) -- but as a theory, it's useful to explain how captives can sometimes begin to identify with their captors (remember 1974's Patty Hearst's abduction by and subsequent becoming part of the Symbionese Liberation Army?).
As a former hospital CEO, I still find it hard to fathom how physicians and/or hospitals can end up in the arms of Optum. I guess the logic of those seeking the embrace of Optum-cum-United is: if you can't beat 'em, join 'em.
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