When I was a grad student at Ohio State in the ‘70’s, one of the most challenging courses I took was “Primary Research Methods in Analyzing Public Data” –an elective.
It was geared to geeks like me intrigued by the tsunami of data beginning to flow from government and private sources. The syllabus promised we’d learn to assess how government data is obtained and structured, its reliability and usefulness to problem solving. My interest was health data: naively, I assumed data about disease prevalence, user experiences, clinical variation, costs, outcomes and processes was readily accessible welcoming geeks like me to explore. I had accepted my Ohio State fellowship because it allowed me to pursue an interdisciplinary program in the Schools of Business, Social and Behavioral Science and Medicine (and because my undergraduate mentors advised my color blindness might negate a career in invasive medicine).
I had spent my formative teen years working at Erlanger Medical Center in Chattanooga—the hospital where I was born. I worked in Central Sterile Supply, Emergency Services and General Surgery doing menial tasks directed by my supervisors. It led me to pre-med studies in undergraduate school and lifelong admiration (and envy) of doctors. They were my heroes: they were smart, respected and, at Erlanger, enjoyed special parking, free meals in their reserved dining room and deference on just about every topic—health related or not.
I knew doctors made a good living: their parking lot was full of nice cars. They lived in the nicest neighborhoods in big houses and they played golf at private clubs that reserved Wednesday afternoons for them.
In those days, Walter Cronkite delivered the CBS Evening News closing each night matter of factly “that’s the way it is” and America believed him. Primetime TV featured my heroes– Alex Reed, Marcus Welby, Ben Casey and Richard Kildare fighting for their patients against the forces of evil—bureaucracy, injustice, legal barriers to care and, on occasion, unknown conditions for which science had no answers.
My Generation—Baby Boomers—has watched the profession of medicine change. We hear our kids and grandkids bemoan issues of access and affordability and rave about the clinicians they believe competent and caring. We hold dear ideals we seek in the profession—fidelity to science, disregard for costs, respect for patients and lifelong, self-motivated clinical learning. But that’s the issue: our romance with the profession’s past is increasingly in conflict with the realities and unknowns about its future.
Practicing with modern technologies to diagnose accurately and coordinate care effectively, optimize reimbursement (and income) and minimize administrative hassles is the holy trifecta for docs. That’s where the profession is today: defiant about insurers, hospitals and drug companies that profit from their labor and confident the best days of medicine are past. Each specialty/discipline/tribe in medicine is focused on their own. And physicians are not alone: Every white-collar profession—doctors, lawyers, educators, engineers et al– faces transformational changes rooted in 3 market-driven (outsider) changes:
- Technologies that enable better, cheaper and faster ways of doing tasks in their trade.
- Rules and regulations that facilitate new/different role definition, constraints and oversight.
- Consumer receptivity to new ways of obtaining the same/similar services deemed to offer higher value.
And each of these professions (including medicine) faces an uncertain future wherein sacred cows face an outsider-constructed slaughter-house demanding greater price transparency, affordability, connectivity, breakthrough innovations and demonstrated competence.
For the profession of medicine, there’s growing recognition of these changes but fierce resistance among some wistful to return to the “good ole days”. That’s the challenge facing the American Medical Association as it seeks to do expand its influence beyond reimbursement, scope of practice, medical liability and intrusion by regulators, insurers, hospitals and government agencies in clinical decision-making.
The data show the majority of physicians are unhappy and uncertain about the future of the profession. The data show they’re working harder and doing more with less. The data show they’re concerned about the future of the health system and think it’s heading in the wrong direction. The data show employed physicians are increasingly dissatisfied in their hospital and private equity relationships. The data show that physicians share of the growing health spending pie is shrinking: from 21.1% in 2000, to 20.1% in 2023 and projected to 19.9% in 2025 and 19.5% in 2033. And data show the profession, along with nurses and pharmacists, enjoys the public’s trust to figure things out.
As a health system futurist, I model future state scenario’s featuring different structures, roles and funding options. In each, physicians are key players at the table—in some more prominently than others. The public is dissatisfied by the status quo but unclear about alternatives.
Might defining a vision for a transformed ‘U.S. System of Health’ be the focus for the medical profession? There’s plenty of data to digest to deliberate objectively. Its willingness and ability to set aside its factionalism for the greater good is the biggest question facing the profession. And the widely-recognized dysfunction of the current U.S. health system presents the urgent opportunity for the profession to step forward. That’s the cross facing the profession.
Paul
P.S. This week, there was widespread speculation that 133-year-old Eastman Kodak might shut down due to questions about its ability to cover an upcoming half-billion debt payment. As CNN noted (August 12, 2025): “Once a photography giant dominating 1970s film and camera sales, Kodak invented the first digital camera in 1975 but failed to capitalize on the shift and had to file for bankruptcy in 2012.” Every business school does a case study on Kodak: the trifecta above is easily applicable. There are lots of Kodaks in healthcare: some of their Boards recognize it, and many don’t. As my dear friend, the late Ian Morrison frequently observed about organizations that inadequately or incorrectly assess trends: they miss the second curve!
Sections in today’s report
- Quotables
- Corporate Healthcare
- Economy
- Governance
- Hospitals
- Insurers
- Prescription Drugs
- Public Health
Quotables from week of August 11, 2025
Report: Not-for Profit Hospital Executive Compensation Pay Gap: “Although nonprofit hospitals are distinct from public corporations, they are increasingly becoming financialized—taking on business practices and governance philosophies that resemble those of publicly traded corporations and financial firms. As this shift intensifies, there is concern that nonprofit hospitals may become a primary source of wage inequality within the health care system. The health care industry employs eight of the ten highest-paid nonprofit CEOs in the country. An analysis of hospital wage ratios found that the highest-paid nonprofit hospital CEOs received 60 times the average hourly pay of hospital workers without advanced degrees. Previous research found that from 2005 to 2015, the CEO-pediatrician pay gap increased from 7:1 to 12:1, and the CEO-nurse pay gap increased from 23:1 to 44:1…Our study results establish the existence of major wage inequalities between executive and nonexecutive hospital workers within nonprofit hospitals. We found that these inequalities may be more dramatic than previously reported… In our longitudinal data set of 1,424 nonprofit hospitals, we found dramatic and growing differences between CEO and average employee wages. As nonprofit hospitals represent regional “anchor institutions,” wage inequality may be considered as an additional dimension of a hospital’s contribution to its community. Ongoing examination of hospitals’ hiring practices and wage policies may become more important as wage inequality rises within nonprofit hospitals.”
Pay Gap Between Nonprofit Hospital CEOs And Employees Grew, 2009–23 | Health Affairs
STAT on AMA Advocacy Strategy: “At the annual meeting of the American Medical Association’s House of Delegates in June, the mood was tense. Hundreds of physicians had congregated in Chicago to vote on the organizations’ key policies. The AMA is the largest professional association for physicians, as well as a political lobbying group with a strong, if waning, presence on Capitol Hill.
As the Trump administration had begun embracing policies that diverged from medical consensus and conflicted with AMA policies, the group had employed a behind-the-scenes battle strategy, honing in on closed-door discussions with lawmakers as the place to push for sound science, evidence-based medicine, physician autonomy, and higher payments. But AMA members were now worried that this strategy, sometimes referred to as “quiet advocacy,” was not working. “
Inside the AMA’s new, louder voice in Washington | STAT
Politico analysis on MAHA Legislation:” A POLITICO analysis found more than 130 bills aimed at regulating ultra processed foods and improving nutrition, over 60 bills restricting the application of pesticides and other chemicals, and more than 130 bills expanding vaccine exemptions or prohibiting mandates this year. Lawmakers also introduced dozens of bills to promote the use of psychedelics, authorize sales of raw milk and ivermectin, and ban the fluoridation of drinking water.
The measures emerging from state legislatures, long seen as testing grounds for federal policy, show how Kennedy’s movement to combat chronic disease has struck a chord across the country — even as it conflicts with traditional Republican views about regulating industry. The number of bills on the subjects has increased at least 45% from the prior year and in 2023 for the four states that convene biennially. The outpouring of interest in Kennedy’s agenda also shows how he has outmaneuvered a public health establishment that has condemned aspects of his agenda, such as expanding vaccine exemptions and ending water fluoridation, as unscientific and dangerous.”
Congress is lukewarm on RFK Jr.’s plans. In the states, they’re catching fire. – POLITICO
Pearl on AI in medicine: “Today’s large language models like ChatGPT, Claude and Gemini are trained on the near-totality of internet-accessible content, including thousands of medical textbooks and academic journals.
This broad, in-depth training enables LLMs to respond to virtually any medical question. But unlike narrow AI, their answers are highly dependent on how users frame their questions, prompt the model and follow up for clarification. That user dependency makes traditional FDA validation, which relies on consistent and repeatable responses, effectively impossible.”
PS: Spotlight on: Monetizing Generative AI Monthly Musings on American Healthcare by Dr. Robert Pearl August 2025
Boston Globe on Clinical Research Integrity: “Data falsification happens, and academia has never managed to stamp it out. Incentives reward breakthroughs like the fake one in this story. Accountability systems aren’t good at dealing with deliberate fraud. When one of these scandals happens, and they keep happening, it’s easier to diminish the credibility of scientific work.
But the administration has pointed to episodes like this to justify a crackdown on science, and another view is that, actually, science works pretty damn well. It moves toward the truth in a messy, sometimes nonlinear, fashion. And yes, when you’re working on the frontiers of knowledge, there will be mistakes, misconduct, and embarrassments. But ultimately science is self-correcting. And even this story demonstrates that.”
“ A Fraudulent Cancer Breakthrough, a test for future president of MIT, and a new age of doubt in science” Starting Point Boston Globe August 13, 2025 mailchi.mp/globe.com/starting-point-a-science-scandals-long-shadow?e=9a6bf96d6a
WSJ on PE Transparency: “Many fund managers strive to be transparent with their financial disclosures. Others are so obstructive that they might as well be kicking sand in investors’ faces.
While private equity is synonymous with opacity, the tricks of the trade are taking on greater importance as the industry seeks to broaden its reach among ordinary investors. President Trump last week signed an order seeking to open up Americans’ 401(k) retirement accounts to private equity and other alternative investments…
To date, private equity has generally been the domain of institutions and high-net-worth individuals with long-term investment horizons and a high tolerance for risk and illiquidity. Less wealthy, ordinary investors have traditionally had only limited access. Their ability to participate has been growing, however, as more funds register with securities regulators and publicly disclose their financial reports. The funds may invest directly in other private-equity funds, or purchase stakes in them on the secondary market from existing investors.
Such funds should, at a minimum, allow investors to see how much each private-equity holding originally cost and compare that with its latest carrying value. Some funds are making this exercise difficult. This is particularly problematic in light of recent controversies over some of the industry’s valuation methods.”
How One Big Private-Equity Fund Makes Its Numbers Incomprehensible – WSJ
STAT investigation of MA research Integrity: “…a study published this January in a major medical journal was a win for UnitedHealth Group. It showed that UnitedHealth’s preferred approach to covering Medicare patients, an especially profitable line of business, was producing higher-quality care for older Americans than the standard method.
But a closer inspection reveals reasons to distrust the narrative. The study was funded by UnitedHealth’s Optum subsidiary, co-authored by a top employee, and based in part on tightly controlled data from its own physician clinics. Its key finding seems to be a statistical mirage, due to flaws in its methodology, according to 13 independent experts who reviewed the manuscript for STAT….
Lobbying groups that promote Medicare Advantage make sure the studies and white papers get in front of lawmakers, regulators, and reporters. One of them, America’s Physician Groups, regularly cites the reports in its letters to members of Congress and comment letters to federal officials who make policy. Another, the Better Medicare Alliance, which counts UnitedHealth as an “ally,” fills journalists’ inboxes with sunny headlines about the program.”
UnitedHealth Medicare Advantage studies raise bias concerns | STAT August 11, 2025
NAHCC on impact of Big Beautiful Bill cuts” on community health centers: “The National Association of Community Health Centers anticipates 1,800 care sites will close, 34,000 jobs will be lost and uncompensated care costs will increase by nearly $7 billion…We’re going to continue to do our best to assure that funding continues and also continues to grow…
When you add it up, between mandatory and discretionary funding, it’s about $6 billion. But that typically represents about 12% of all community health center costs. The data in 2024 showed the cost of running community health centers across the nation is $51 billion, so we’re only 1% of all healthcare spending.
Based on Congressional Budget Office estimates, we will take on four million more uninsured patients as a result of those who are currently uninsured on Medicaid or on the Affordable Care Act marketplace who will become uninsured. One of our requirements is we have to see everyone regardless of their ability to pay. We cannot be like other parts of the health system, where they can say “I’m not going to see you until you pay me.”
National Association of Community Health Centers www.nahcc.org
New York Times on BLS Data Integrity: “The Bureau of Labor Statistics, an obscure economic arm of the federal government, is getting a new leader (E.J. Antoni). Trump has nominated an economist from the conservative Heritage Foundation to replace the bureau’s chief, whom he fired after a less-than-stellar jobs report.
It’s hard to get bad news — so the administration is trying not to. When the Bureau of Labor Statistics said that hiring this year was more sluggish than it had previously reported (revisions like that are normal), the president said without evidence that the new figures were “rigged” to make him look bad. Economists across the political spectrum worry that his nominee will proffer friendlier data. Trump has previously canned scientists, closed databases and otherwise fettered the delivery of inconvenient facts.”
The Morning: Inconvenient facts August 13, 2025
Jarrard on Fake News: “For healthcare, the consequences of fake news are already piling up: Think vaccine hesitancy that has rapidly converted into widespread resistance and outrage. The rash of miracle cures and unproven treatments featured on Instagram. Efforts to undermine trust in clinicians, public health organizations and established scientific bodies. And so much more.
The rise of fake news can be attributed to specific people. But what’s also been created is an environment where people can choose to immerse themselves in it. Gone are the days when everyone saw the same information, whether they liked it or not. Algorithms mean that everything is hyper-personalized, and any interaction with information only serves to narrow the lens further.
That’s a brutally tough trend to counteract, but thoughtful, patient, listening-first conversation is a good place to start.”
Debunking Healthcare Misinformation and Fake News – Jarrard Inc
WSJ on AI-enabled IQ testing: “One group of computer scientists in Berkeley, known as the rationalists, fear that AI poses an existential risk to humanity—so they are trying to use genomics to breed smarter humans who can save us all…
Yet the growing IQ fetish is sparking debate, with bioethicists raising alarms. Genetic tests have a limited ability to predict IQ, and experts caution about unintended consequences.”
Inside Silicon Valley’s Obsession with High-IQ Babies futureofeverything.cmail19.com/t/d-e-glilykl-jyqkitjul-r/
Free Press on Competition for Designer Babies: “What if I told you that, within a generation, any baby born with a genetic disease could be cured? Sounds miraculous, right?
But what if I told you that the same technology that gets us there—it’s called CRISPR-Cas9—could allow would-be parents to pick the color of their babies’ skin? Or, eventually, even their IQ?
That’s kind of scary.
CRISPR-Cas9 gives us the power to edit human genes. Some believe it has the potential to usher in a future with no disease. Others believe it could also bring us a future of “designer babies”—which is another way of saying eugenics. Somewhere between the two, there’s a bright line.
The challenge—for scientists, ethicists, politicians, parents, all of us—will be to decide where, exactly, that line is. And we need to decide soon, because advances in gene editing are coming lightning fast.”
The Race to Make Designer Babies – The Free Press
AEI on DC lobbying in 2Q2025: “Donald Trump, when he ran against Hillary Clinton and Joe Biden, promised that he alone could fix the problem of self-dealing insider enrichment. That promise has proven hogwash, and the latest lobbying filings put a number on the falsehood: $20.4 million.
That’s the lobbying revenue Ballard Partners reported for April through June of this year, the first full quarter of the second Trump administration. This is a record: the most lucrative quarter ever reported by a lobbying firm, even when adjusted for inflation.
What is Ballard Partners? It’s the lobbying firm launched by a former attorney for the Trump Organization, and from which Trump hired Attorney General Pam Bondi and White House chief of staff Susie Wiles…
Ballard led the league in second-quarter lobbying revenue according to second-quarter filings required by the Lobbying Disclosure Act. Its $20.4 million haul was not only a record for any lobbying firm, it was also nearly five times the firm’s number in last year’s second quarter and about triple its previous best quarter on record, according to data from the Center for Responsive Politics…
Pay the president’s friends, get profitable policies: This is how Washington worked before Trump promised to fix it. What’s changed is the dollar amount and who’s getting paid.”
Corporate Healthcare: News of Note about Major Organizations in U.S. Healthcare
- AppleAAPL is bringing back the blood oxygen feature for some models of the Apple Watch nearly two years after it was forced to remove the capability due to a bruising patent dispute with a rival.
- Warren Buffet (Berkshire Hathaway) invested $1.8 billion in UHG believing the company is under-valued.
- EPIC hosts its annual User Group Meeting (UGM) in Verona WI this week. Per KLAS, the company grew its market share to 42% of acute care hospitals and 55% of acute care beds at the end of 2024, up from 39% of acute care hospitals and 52% of beds in 2023.
Economy
Consumer Sentiment for August 2025: “Consumer sentiment fell back about 5% in August, declining for the first time in four months. This deterioration largely stems from rising worries about inflation. Buying conditions for durables plunged 14%, its lowest reading in a year, on the basis of high prices. Current personal finances declined modestly amid growing concerns about purchasing power. In contrast, expected personal finances inched up a touch along with a slight firming in income expectations, which remain subdued. Overall, consumers are no longer bracing for the worst-case scenario for the economy feared in April when reciprocal tariffs were announced and then paused. However, consumers continue to expect both inflation and unemployment to deteriorate in the future.
Year-ahead inflation expectations rose from 4.5% last month to 4.9% this month. This increase was seen across multiple demographic groups and all three political affiliations. Long-run inflation expectations also lifted from 3.4% in July to 3.9% in August. This month ended two consecutive months of receding inflation for short-run expectations and three straight months for long-run expectations. Still, both readings remain well below the highs seen briefly in April and May 2025.”
Index of Consumer Sentiment, University of Michigan released August 15, 2025 https://www.sca.isr.umich.edu/
BLS’ CPI Report for July 2025: “In July, the Consumer Price Index for All Urban Consumers rose 0.2 percent, seasonally adjusted, and rose 2.7% over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.3% in July (SA); up 3.1% over the year (NSA).” Note: the medical care services index was up .8% in July and 4.3% LTM.
Consumer Price Index for July 2025 released August 12, 2025 https://www.bls.gov/cpi/
BLS’ Producer Prices Report for July 2025 “The Producer Price Index for final demand rose 0.9% in July. Prices for final demand services advanced 1.1%, and the index for final demand goods increased 0.7 %. On an unadjusted basis, the index for final demand moved up 3.3% for the 12 months ended in July.”
Bureau of Labor Statistics Producer Price Index released August 14,2025 https://www.bls.gov/news.release/ppi.t03.htm
Mortgage rates:” Mortgage rates edged down to their lowest level of the year, offering a dash of hope to prospective buyers who have been forced to the sidelines by elevated rates and home prices. The average rate on the standard 30-year fixed mortgage declined to 6.58%, according to a survey of lenders by mortgage-finance firm Freddie Mac. That was a low not seen since October 2024 and down from 6.63% a week earlier.
The housing market has been stuck in a rut for the third consecutive year. Sales activity is at its lowest levels in about three decades and home prices have risen again to new highs. The spring selling season, usually the busiest time of the year for home sales, was another bust…
Mortgage rates tend to move loosely with government bond yields, which help set some borrowing costs across the economy. Bond yields have edged lower after a report this month showed hiring slowed sharply over the summer, putting downward pressure on mortgage rates.”
Mortgage Rates Slip to Lowest Level of 2025 – WSJ
Governance
Report: Board Effectiveness and Strategic Planning: “In a recent survey of nearly 100 public company CEOs and board members, conducted by Corporate Board Member in partnership with the Long-Term Stock Exchange, we uncovered a striking pattern: Companies committed to long-term strategies demonstrate measurably greater confidence and resilience when navigating economic uncertainty…
- Confidence grows with a longer horizon. Long-term-focused firms rate their competitiveness over the next 3–5 years nearly 10% higher than short-term peers, suggesting that alignment around a shared future vision can bolster both strategic decision-making and morale.
- Risk priorities reflect time horizon. Boards steering for the long haul are more likely to spotlight systemic threats…
- Scenario planning drives agility. Nearly half of long-term-aligned companies regularly engage in detailed scenario modeling and proactively adjust capital allocations in anticipation of multiple possible futures, versus less than one-third of short-term peers who often react after risks materialize.
- Resilience lies in strategic investor relationships. Companies with lower long-term alignment are five times more likely to lean heavily on reactive investor communications (20 percent vs. 4 percent), suggesting that long-term aligned boards build deeper, more stable investor partnerships that reduce crisis ridden outreach.”
Hospitals
Study: Executive Compensation in Not-for-Profit Hospitals: Researchers used Internal Revenue Service Form 990 and Medicare cost reports from the period 2009–23 to examine trends in wages within nonprofit hospitals and assess differences by hospital characteristics.
Per the Economic Policy Institute, from 1978 to 2022, CEO compensation grew 1,209.2%, whereas the typical worker’s compensation in the same period grew 15.3%. In 2022, among the largest 350 public corporations in the US, it was estimated that CEOs were paid 344 times more than the average nonsupervisory worker.
Bivens J, Kandra J. CEO pay slightly declined in 2022 [Internet]. Washington (DC): Economic Policy Institute; 2023 Sep 21 [cited 2025 May 30]. Available from: https://www.epi.org/publication/ceo-pay-in-2022/ Google Scholar
Keckley note: Not for profit hospital executive compensation has been called out in recent Congressional Hearings and in state legislatures examining tax exemptions. Board compensation committees will be an increased focus of media attention and hospital hourly-worker labor negotiations.
Fitch: Credit ratings for nonprofit hospitals: “The gap between credit upgrades and downgrades has nearly closed this year, with nine upgrades and eight downgrades from January through June…Downgrades had surpassed upgrades over the last couple of years, including more than 15 downgrades in 2024 and more than 20 downgrades in 2023 from Fitch.
Negative outlooks still outpace positive outlooks, though roughly 80% of rating outlooks are stable this year, according to Fitch. Most of this year’s downgrades were tied to operational issues, such as lower-than-expected revenue or pressure from supply expenses..,”
Keckley note: Fitch has projected slow but solid recovery in the NFP hospital sector since 2024 with supply chain and labor cost pressures less in 2025 prompting a change in its rating from negative to neutral. But the impact of tariffs on the supply chain and Big Beautiful Bill Medicaid cuts are unknowns so caution is advised.
Likewise, on August 7, S&P advised that margins and operating performance in the not-for-profit hospital sector were improving offering an optimistic outlook for the balance of 2025.
Fitch Ratings www.fitchratings.com
Manhattan Institute Study: Inpatient behavioral health access, IMD exclusion:” Many Americans with serious mental illness lack access to inpatient psychiatric care. For decades, Medicaid’s “institutions for mental diseases” (IMD) exclusion has been a major barrier to expanding psychiatric hospital bed capacity, but the ongoing mental-health crisis has recently led policymakers to consider repealing or modifying the IMD exclusion.” Per the Manhattan Institute analysis released last Thursday:
- “The average size of a U.S. psychiatric hospital is 108 beds—smaller than the average general hospital—and 95% of all psychiatric hospitals are under 305 beds. Perceptions of psychiatric hospitals as very large-scale institutions are therefore misrepresentative. Less than 8% of psychiatric hospitals have 16 beds or fewer, the limit for federal financial participation. The vast majority of psychiatric hospitals are therefore not covered settings for Medicaid beneficiaries under the IMD exclusion.
- Since its establishment in 1965, the IMD exclusion has been repeatedly modified. Yet changes have not increased beneficiaries’ access to psychiatric hospital treatment at scale. The number of public psychiatric beds, which are most likely to serve Medicaid patients, is down by over 97% since its peak and remains low despite a decade of exemptions that allow greater Medicaid coverage….”
Study: Eliminating Bad Debt Reimbursement to Hospitals Serving Traditional Medicare Beneficiaries:
Context: “The Medicare program reimburses hospitals 65% of cost-sharing that Traditional Medicare (TM) beneficiaries fail to pay so long as the hospital makes reasonable efforts to collect the debt (42 CFR 413.89). Congress is considering a phase-out of bad debt reimbursement to reduce federal expenditures. However, the distributional consequences of eliminating hospital bad debt reimbursement—and savings that could be achieved—are inadequately understood.”
Methods: “We studied general short-term hospitals with 2023 cost report data… “
Results: “Of 4293 study hospitals, 3952 (92%) reported Medicare-eligible bad debt in 2023. Total Medicare bad debt was $2,549,796,622, or a mean (SD) of $593,942 ($906,811) per hospital There were 848 hospitals that reported bad debt of at least 0.5% of net patient revenues These high bad debt hospitals were smaller (mean [SD] beds, 64.7 [80.7] vs 164.1 [178.8] beds; SMD = −0.72) and had higher ratios of Medicare bad debt to beds (mean [SD], $15 558 [$17 104] vs $3176 [$3151]; SMD = 1.01). High-bad debt hospitals reported lower operating margins (mean [SD] −0.6 [14.3] vs 2.2 [13.8] points; SMD = −0.20), but similar liquidity (mean [SD] net asset ratio, 0.63 [0.77] vs 0.67 [0.79]; SMD = −0.05). Nearly three-fifths of high–bad debt hospitals were critical access hospitals (723 of 3445 hospitals [59%] vs 497 of 848 hospitals [21%]; mean difference, 0.38). While hospitals in California, Texas, and Florida collectively reported nearly $725 million in bad debt, hospitals with high bad debt were disproportionately located in the Upper Midwest. ..”
Discussion: Under current law, 65% of the $2.6 billion in current TM hospital bad debt is eligible for reimbursement. The estimates from this cross-sectional study imply that this $1.7 billion in federal expenditures might be averted were bad debt reimbursement eliminated. “
Study: Relationship between Hospital Finances and Provision of Obstetric and Neonatal Intensive Care Unit (NICU) Services
Context: “Access to high-quality US hospital–based perinatal care is limited, contributing to poor outcomes… Strong hospital financial health, or a hospital’s long-term financial stability, is associated with improved adult care quality and outcomes, but its association with perinatal access and outcomes is unclear…
Methods: We used 2010 to 2018 annual American Hospital Association (AHA) survey and Centers for Medicare & Medicaid Services Healthcare Cost Report Information System data (91% merge)…
Results: The study included 4931 hospitals, with 1164 providing OB and NICU care, 2026 providing OB care, 83 providing NICU care, and 2008 providing neither service. Low OM hospitals were more frequently government-owned, nonteaching, critical access, and located in southern and rural areas. These hospitals provided less OB and NICU care, had few births annually, had worse financial metrics, and were less likely to receive DSH payments.
Discussion: In this cohort study, worse hospital financial health was associated with decreased likelihood of providing perinatal services. These hospitals were more frequently located in southern and rural areas. There was a moderate correlation with higher percentage of births in DSH-receiving hospitals and reduced maternal mortality.”
Insurers
Insurer 2Q 2025 earnings, outlook: “Health insurance companies facing a challenging financial and regulatory future have pledged to raise premiums, deploy artificial intelligence and exit unprofitable markets to salvage profit margins.
During the second quarter, high costs across all lines of business dampened earnings at large publicly traded health insurers such as UnitedHealthcare parent company UnitedHealth Group, Elevance Health and Centene.
Centene, Molina Healthcare and Elevance Health lowered their financial guidance for the year in response to consecutive lackluster quarters. UnitedHealth Group set its projections below Wall Street expectations.
Aetna parent company CVS Health and Humana raised projections, although profit margins lagged historical highs, while Cigna reaffirmed its guidance as its Evernorth Health Services subsidiary buoyed earnings.
The second half of the year and beyond don’t look much brighter for the sector.”
Nona Tepper August 13, 2025 How Aetna, Cigna, UnitedHealth stacked up in Q2 earnings – Modern Healthcare
Study: Long-Term Services in Medicare Advantage Plans:
Context: “Medicare Advantage (MA) plans have had the ability to offer long-term services and supports (LTSS) supplemental benefits (e.g., in-home support services, adult day health services, caregiver support, home-based palliative care, and nonopioid pain management) since 2019. However, it is largely unknown how available these benefits currently are among MA plans…
Objective: “To examine the prevalence of LTSS supplemental benefits among MA plans and enrollment within these plans.”
Results: “In this study of 4521 MA plans in 2019 and 6614 MA plans in 2025, the number of MA plans offering any LTSS benefits increased from 581 to 814 from 2019 to 2025; however, the share of such plans slightly decreased from 12.9% to 12.3%. A mean (SD) of 21.4% (20.9%) of MA beneficiaries at the county level were enrolled in plans offering supplemental benefits in 2019, which decreased to 7.9% (12.7%) in 2025. The share of plans offering in-home support services, adult day services, home-based palliative care, and nonopioid pain management increased by 4.6, 0.02, 1.1, and 1.9 percentage points, respectively, whereas caregiver support services decreased by 5.6 percentage points. Lastly, when comparing newer and older MA plans offering LTSS benefits, newer MA plans offered 0.59 (95% CI, 0.48-0.70) more benefits than older MA plans.
Physicians
Kaufman Hall: Physician reimbursement trends: “Physician reimbursement has declined over the past two years, amplifying concerns from doctors that a proposed Medicare pay bump next year will not be enough to sustain their practices. Clinicians are working more but are getting paid less per procedure.., according to a new report from consultancy Kaufman Hall.” Highlights:
- Expense growth, reimbursement cuts plague physicians: The median payment for the amount and type of treatment clinicians provide declined 7% between the second quarters of 2023 and 2025… Over that same span, the median expense per physician and advanced practice practitioner rose 7%.
- Doctors are more productive: Physician productivity, as measured by a metric known as the work relative value unit per full-time equivalent employee, increased 12% from the second quarter of 2023 to the same quarter in 2025,
- Physicians have less support: The number of support staff relative to physician productivity declined 13% between the second quarters of 2023 and 2025.
- Care is shifting from hospitals to clinics: Revenue tied to clinicians’ work in surgical and hospital-based specialties has decreased over the past two years, highlighting a shift toward outpatient care Physicians are treating more patients in surgery centersand clinics as technology advances and regulations shift. While clinicians and patients often prefer these settings, insurers tend to pay less for outpatient care versus inpatient care.
Physician reimbursement drops amid rising workloads: Kaufman Hall – Modern Healthcare
Kaufman Hall: 2Q 2025 Physician Flash Report: Highlights: Based on its evaluation of work relative value units (wRVUs) per full-time employee: 6,449 for physicians and 5,030 for advanced practice providers (APPs):
| Select Measures | Q2 2025 | Chg. vs.Q2 ‘24 | Chg.vs. Q2 ‘23 |
| Revenue per Provider (Physicians + APPs) | $404,116 | +4% | +5% |
| RVUs per Fulltime Provider FTE | 5,030 | +6% | +12% |
| Total Direct Expense per Provider FTE | $659,025 | +4% | +7% |
| Physician Compensation/FTE | $376,609 | +3% | +6% |
| Support Staff/10,000 Provider wRVUs | 2.99 | -3% | -13% |
Keckley note: Despite increased productivity and lower support staffing expense, the gap between revenue and expenses per provider FTE is widening. The impact of not uniform across all practice settings but problematic to all. A new model for physician payment is needed balancing public interests, costs and scope of practice in an AI-enabled future state environment and patient-directed, technology-enabled self-care.
Physician Flash Report: Q2 2025 Metrics | Kaufman Hall August 11, 2025
Study: Physician Incentive to Increase Referrals to High-Value Settings:
Context: “… Increased utilization of settings that offer high value (which the authors define as a combination of lower cost and equivalent or higher quality by comparison with other options in the same market) could produce substantial cost savings for patients, commercial insurers, and the health system. Few interventions have consistently shifted referrals to high-value settings. The authors designed a multipronged, behaviorally informed intervention for clinicians and practices consisting of four elements to increase referrals to high-value settings: (1) individualized goals given to physicians and practices for referring to high-value settings; (2) financial incentives; (3) individualized selection of and coaching on high-value facilities and specialists; and (4) monthly performance feedback. …
Results: “The authors found that the use of high-value settings significantly increased in the intervention group, compared with the control group, for radiology procedures (adjusted percentage-point difference [ppd] 18.7; 95% confidence interval [CI], 4.6 to 32.7). Significant cost savings were observed for both radiology (adjusted differential savings, 18.6 pp; 95% CI, 3.2 to 34.1) and elective orthopedic procedures (adjusted differential savings, 22.6 pp; 95% CI, 4.3 to 41.0). No significant changes in high-value referrals were observed in laboratory (adjusted ppd, 5.4; 95% CI, −2.7 to 13.5), elective orthopedic procedures (adjusted ppd, 9.1; 95% CI, −2.2 to 20.5), elective gastroenterology procedures (adjusted ppd, 5.5; 95% CI, −4.9 to 15.9), or new patient specialist referrals (adjusted ppd, −1.6; 95% CI −4.6 to 1.5).
“In its first year, a multipronged, microtargeted, behaviorally informed intervention was associated with increases in referrals to high-value settings for radiology procedures but not for four other service types. Physician- and practice-focused interventions may be an effective and scalable avenue for generating site-of-service savings for certain service types, with moderate changes in referral behavior translating into large cost savings.”
Study: Clinician Panel Size and Nursing Home Use, Outcomes: “In this cohort study, nursing home physician or advanced practitioner panel size was not associated with higher rates of rehospitalization, lower rates of successful discharge to community, or lower rates of functional improvement at discharge from post-acute care in the nursing home…Patients of clinicians in the lowest decile of patient volume did not experience significantly different outcomes compared with those in the highest decile: the incidence rate ratio (IRR) was 1.05 (95% CI, 0.76-1.46) for rehospitalizations, 0.96 (95% CI, 0.86-1.07) for successful discharge to community, 1.03 (95% CI, 0.90-1.19) for ED visits, and 0.96 (95% CI, 0.88-1.40) for functional improvement at discharge from the nursing home.”
Rate of No-Show Appointments by Patient Age and Portal Usage, 2024:
| Age | Portal Users | Non-Users |
| Overall | 6.2% | 7.9% |
| 18-34 | 9.3% | 10.9% |
| 35-49 | 7.8% | 9.9% |
| 50-64 | 6.2% | 8.7% |
| 65+ | 4.3% | 6.2% |
Epic Research, Patient Portal Use Associated with 21 million Fewer Visit No-Shows in 2024, July 2025
Study: Evaluating Hospital Course Summarization by an Electronic Health Record–Based Large Language Model
Context: “Hospital course (HC) summarization represents an increasingly onerous discharge summary component for physicians. Literature supports large language models (LLMs) for HC summarization, but whether physicians can effectively partner with electronic health record–embedded LLMs to draft HCs is unknown.
Method: “Quality improvement study using a convenience sample of 10 internal medicine resident editors, 8 hospitalist evaluators, and randomly selected general medicine admissions in December 2023 lasting 4 to 8 days at New York University Langone Health.
Results: Among 100 admissions, compared with physician HCs, residents edited a smaller percentage of LLM HCs (LLM mean [SD], 31.5% [16.6%] vs physicians, 44.8% [20.0%]; P < .001). Additionally, LLM HCs required less semantic change (LLM mean [SD], 2.4% [1.6%] vs physicians, 4.9% [3.5%]; P < .001). . Electronic health record–embedded LLM HCs required less editing than physician-generated HCs to approach a quality standard, resulting in HCs that were comparably or more complete, concise, and cohesive, but contained more confabulations. Despite the potential influence of artificial time constraints, this study supports the feasibility of a physician-LLM partnership for writing HCs and provides a basis for monitoring LLM HCs in clinical practice.”
Prescription Drugs
FDA Drug approvals in 2025 YTD: “Does Food and Drug Administration Commissioner Marty Makary want to accelerate life-saving drugs as he claims? The agency’s recent torpedoing of an immunotherapy shot for advanced melanoma and slow-rolling a treatment for a rare disease raise big questions.
The FDA’s approval of new drugs has notably slowed this year. Annual novel drug approvals averaged 52 in the first Trump Presidency and 48 under Joe Biden, but there have been only 22 in the first seven months of this year. On current trend that would make 38 for the year.”
Drug Approvals Hit an FDA Wall – WSJ
Drug pricing relative to national income: Researchers analyzed the 2022 list prices and affordability of 549 essential medicines across 87 high-, middle-, and low-income countries. Results:
The availability of essential medicines ranged from 225 (41%) in Kuwait to 438 (80%) in Germany (base country). After accounting for purchasing power parities, prices of essential medicines in Lebanon were, on average, 18.1% of those in Germany (Lebanon price index, 18.1 vs Germany price index, 100), while average prices in the US were 3.0 times higher than in Germany (US price index, 298.2). A positive association was observed between countries’ gross domestic product per capita (expressed in logarithmic terms) and nominal drug prices (R = 0.30; P = .01), indicating that richer countries generally had higher drug prices. However, when adjusting for the purchasing power of different currencies, an inverse association was observed suggesting that richer countries had lower real prices. Drug affordability, as measured by the number of days’ minimum wage needed to purchase a month’s treatment, varied widely, with median affordability highest in Europe and the Western Pacific, and lowest in Africa and Southeast Asia…Strategies to promote equitable drug prices and improve drug affordability are urgently needed.”
Public Health
Gallup: Alcohol consumption drop: “The percentage of U.S. adults who say they consume alcohol has fallen to 54%, the lowest by one percentage point in Gallup’s nearly 90-year trend. This coincides with a growing belief among Americans that moderate alcohol consumption is bad for one’s health, now the majority view for the first time.
Gallup has tracked Americans’ drinking behavior since 1939 and their views of the health implications of moderate drinking since 2001. The latest results are from Gallup’s annual Consumption Habits survey, conducted July 7-21.
From 1997 to 2023, at least 60% of Americans reported drinking alcohol. The figure fell to 62% in 2023 and to 58% in 2024, before reaching 54% today. Prior to the most recent poll, the rate has been under 60% fewer than 10 times, including 58% in the initial 1939 poll and a one-time low of 55% recorded in 1958. The highs of 68% to 71% were all recorded between 1974 and 1981.”
U.S. Drinking Rate at New Low as Alcohol Concerns Surge August 13, 2025
KFF Report: Homelessness Executive Order: “President Trump recently signed an executive order on homelessness, mental health, and substance use that leverages federal funding priorities and other administrative tools to encourage states to ban public drug use, remove unhoused people from public spaces, and broaden civil commitment laws to permit involuntary psychiatric civil commitments in more circumstances. It also instructs the Department of Housing and Urban Development (HUD) to end funding for programs that use the “Housing First” approach–which provides immediate housing without preconditions such as sobriety or mandatory mental health treatment—and instead to fund programs that require individuals to participate in treatment prior to receiving housing assistance. The executive order comes about one year after the 2024 Supreme Court decision (Grants Pass v. Johnson), which makes it easier for law enforcement to ticket, fine, or arrest people sleeping on public property. Approximately 220 local governments have since passed enforcement measures targeting homelessness…
Taken together, these policies represent a departure from decades of court-backed deinstitutionalization, which emphasized voluntary, community-based care in less restrictive settings…In 2024, about one-quarter (26%) of adults experiencing unsheltered homelessness had a serious mental illness and a similar share had a chronic substance use disorder—both higher than the general population. The number of adults experiencing unsheltered homelessness increased by more than 40% since 2018, while the share with serious mental illness has remained relatively stable and the share with chronic SUD trended upward…”
Keckley note: In most studies of population health, food security and housing are associated with improved health and lower costs. However, in most communities, public health programs focused on housing operate independent of the local health system limiting effectiveness. In better-performing systems of the world, health and social services programs including housing, food security et al are integrated. Not so in the U.S.—a major structural flaw since integrated social services reduced demand and cost associated with downstream specialty services.
A Look at the New Executive Order and the Intersection of Homelessness and Mental Illness | KFF
