Disclaimer: This Ai-generated and hosted podcast is created, managed, and edited by Dr. Chad Swanson. See chadswanson.com. He considers this an informal conversation with the world about health systems transformation. It should not be considered medical advice. While Dr. Swanson reviews and edits all of the text, given the nature of AI, there will be errors. Dr. Swanson welcomes questions, corrections, and criticisms. This is a learning journey, not a definitive source of information. References: Aiken, L. H., et al. (2021). "Effects of nurse staffing on hospital mortality and adverse outcomes: Systematic review and meta-analysis." BMJ, 374, n2083. Bashshur, R., et al. (2016). "The empirical foundations of telemedicine interventions for chronic disease management." Telemedicine and e-Health, 22(3), 163-175. Buchan, J., et al. (2022). "Nurse pay and workforce retention: International policy lessons." Health Policy, 126(7), 654-670. CMS (2023). "Alternative Payment Models: The Next Generation." Centers for Medicare & Medicaid Services. Eibner, C., et al. (2021). "Modeling the Impact of Health System Reform." RAND Health Quarterly, 9(2). Frakt, A. B., & Mayes, R. (2021). "Beyond Capitation: How New Payment Models Are Reshaping Healthcare Economics." New England Journal of Medicine, 384(5), 407-416. OECD (2022). Health at a Glance 2022: OECD Indicators. USPSTF (2022). Guide to Clinical Preventive Services.
Sofia Ramirez
David, earlier this week, we shared an episode that sparked some comments on Linkedin. I mean, people are really digging into the ideas around radically transforming our health system, but letâs just say, not everyone agrees it's feasibleâor even fair. And I think itâs worth taking some time to respond to those concerns directly.
David Caldwell
Before we dive into that, Sofia, Dr. Swanson wanted to share a message. He said: "Hey, everyone. Dr. Swanson here. There have been a number of responses on social media about how people just can't tolerate the AI voices. I totally hear you. Frankly, I would never have thought that I would be making a podcast like this a month ago. I just keep wondering if the benefits outweigh the downsides. Here's the deal: I work fulltime in the ER. And I'm writing a book: a true story of a brilliant, visionary black doctor who lived in the 1890s. So my time is limited. But I also think that I have a perspective to offer to the world. The combination of ER, complex systems, public health, transformational change, and history is unique and needed. So using AI gives me the time to create a podcast that is relevant to current events, responsive to your comments and questions, focused on historical transformation, and relatively unbiased. But I may not continue this for more than a couple more months unless I really get the sense that it provides value. So here's what I ask of you: If you really like what I'm doing on this podcast, reach out to me. Let me know on Tiktok, YouTube, Linkedin, or email me at rchadswanson@gmail.com. If you like the content, but can't stand the AI, then also let me know, but do me a favor, and listen to at least 3 episodes to see if it grows on you. And if you just can't stand it, please let me know. My hope is that we can create a community of people that learn together over time, and make and impact. Thanks! Now back to my AI hosts, David and Sofia": You know, the idea of changing the system at such a fundamental levelâitâs overwhelming. But the underlying principles we talked aboutâwhole-system coordination and outcome-based incentivesâare actually designed to tackle those very concerns. Letâs break this down a bit. Please. I think we need a crash course here, or at least, I do!
Sofia Ramirez
Fair enough. Okay, letâs start with coordinationâwhich some commenters flagged as impossible. The truth is, a healthcare system that doesnât coordinate is inefficient by design. Patients slip through the cracks, duplicate tests get ordered, and costs skyrocket for no reason. And weâve seen examples globally where better coordination works: countries like Sweden or the Netherlands have systems that prioritize communication and integration. When we implement data-sharing, aligned incentives, and cross-discipline care teams, the results are better for everyone. Itâs not easy, but itâs far from impossible.
David Caldwell
Okay, but what about equity? Some folks mentioned that focusing on efficiency and system-wide changes might inadvertently hurt the people who are already struggling the mostâlow-income communities, for example.
Sofia Ramirez
Thatâs such a crucial point, David. And it comes down to designing the solutions with those communities in mind from the start. For instance, we talked about health as a shared responsibility, right? That means investing in things like community health workers, expanded access to preventive care, and ensuring rural or underserved areas get the resources they need. Itâs not a one-size-fits-all approach, but one where equity is baked into the system design.
David Caldwell
I gotta say, I really like how you tie it back to prevention too. I mean, those investments upfront seem like theyâd save money and improve outcomes in the long run. But... finances. That came up a lot, didnât it?
Sofia Ramirez
Oh, absolutely. People areâjustifiablyâworried about whoâs gonna foot the bill for all this. And hereâs where outcome-based incentives change the game. Instead of paying for the volume of careâfor surgeries, tests, or hospital staysâwe shift to paying for results. Did the patient get better? Did we prevent that diabetes case? Those are the outcomes weâre focusing on. And this model has shown it can actually lower costs while improving care. Itâs not cheap to implement, but over time, the savings can be significant.
David Caldwell
Wait. So, you're saying weâre weâre not just throwing money at the system but restructuring the financial incentives? That sounds like a huge cultural shift too, not just economic.
Sofia Ramirez
Exactly! It is cultural, economic, and operational. It's all interconnected. But hereâs the thing: small changes wonât cut it. Thatâs the hard truth. Transformation has to be big and systemic to actually address these issues.
David Caldwell
So, building on what we talked about with systemic change and outcome-based incentives, there's this claim that's caught my attention recently. It argues that health outcomes are essentially locked in by the time we hit age 8. The idea is that trying to intervene later becomes both expensive and ineffective. Honestly, that feels a bit... fatalistic?
Sofia Ramirez
It really is. And while thereâs a kernel of truthâearly childhood definitely plays a critical role in lifelong healthâthe idea that later interventions are futile? Thatâs not supported by the evidence. The data actually shows that investments across the entire lifespan can make a significant impact. Itâs not either/or. It's both/and.
David Caldwell
Okay, but why does this narrative keep coming up, then? Like, is there some big study that people are clinging to, or is it more of a... convenient excuse to avoid spending?
Sofia Ramirez
Itâs a mix. There are studies that highlight the outsized influence of those first eight yearsâespecially in brain development, socio-emotional skills, and resilience. But the problem is, some folks interpret that as a reason to front-load all our resources into early childhood and abandon later stages of life. Itâs reductionist thinking, honestly.
David Caldwell
And whatâs the counterpoint? I mean, where do we see proof that stepping in later still makes a difference?
Sofia Ramirez
Oh, there are countless examples. Take smoking cessation programs for adultsâthose have been shown to significantly reduce the risk of heart disease and cancer, even if someone quits in their fifties or sixties. Chronic disease management, like helping patients adhere to medication for conditions like hypertension or diabetes, can massively curb complications later in life. And letâs not forget mental health interventionsâtherapy and treatment for depression or PTSDâthat can improve quality of life no matter when theyâre initiated.
David Caldwell
Wait, thatâs wild. So even in cases where damage has already been done, interventions still pay off? Kind of flies in the face of that whole âtoo little, too lateâ mentality.
Sofia Ramirez
Absolutely. And think about policies like increasing access to higher education or job training programs for middle-aged workers. These types of social determinants of healthâeducation, income stability, housingâcan trigger dramatic health improvements even well into adulthood. The data supports this, time and time again.
David Caldwell
But let me play devilâs advocate here: Is there a concern about diminishing returns? Like, does the cost of later-stage interventions outweigh the potential benefits?
Sofia Ramirez
Itâs a valid question. But we need to look at the broader picture. Preventive care undoubtedly gives us the best bang for our buck, which is why early life investments are so important. But the return on investment from later interventions isnât negligibleâitâs highly dependent on how and where the money is spent. Take rehabilitation programs for stroke survivors, for example. They might be costly upfront, but they significantly reduce the need for long-term care and improve patient independence. Itâs not about choosing one stage of life over the other; itâs about building a system that invests appropriately across all stages.
David Caldwell
You know, as weâre talking about system-wide changes and making this investment work at every stage, I keep hearing concerns about rural areas. Some folks worry that these big reforms might actually make things harder for them. What do you think, Sofia?
Sofia Ramirez
Thatâs a really legitimate concern, David. Rural areas already face significant challengesâlimited healthcare infrastructure, longer travel times for patients, and fewer specialists. And the truth is, if weâre not careful, broad changes could widen those gaps instead of closing them. Itâs all about how we design the system.
David Caldwell
Right, and when people say this could hurt rural communities, are they mostly talking about access, or is it also a funding issue?
Sofia Ramirez
Itâs both, but letâs start with access. If youâre in a rural county, you're already more likely to face delays in getting care. And when funding models prioritize efficiency without exceptions for geography, rural hospitals often struggle to stay openâbecause theyâre serving smaller populations, right? This has been happening for years, with rural hospitals closing at an alarming rate.
David Caldwell
Wait, like, what kind of numbers are we talking about here? How many hospitals are we losing?
Sofia Ramirez
Since 2005, over 180 rural hospitals have closed in the United States. And thatâs not just a statistic; itâsâwellâitâs lives. Because once those closures happen, people are left without timely access to emergency care, let alone routine or specialist treatments. It intensifies health disparities for millions.
David Caldwell
Thatâs, uh... honestly devastating. But I guess my question is, how do you fix that without undermining the whole idea of cost efficiency?
Sofia Ramirez
Great question. One way is to build incentives that account for these geographic realitiesâa kind of âequity adjustment,â if you will. Take telemedicine, for instance. It has enormous potential to bridge the gap, ensuring rural patients can see specialists or get mental health care without traveling hundreds of miles. But that requires investing in broadband infrastructure, too. Itâs not a one-step solution.
David Caldwell
And what about the financial viability of hospitals themselves? How do you keep them above water?
Sofia Ramirez
Thatâs where funding formulas need to shift. For example, we could introduce payment models that reward rural hospitals for outcomes and community health improvements rather than just the volume of procedures they perform. Itâs about recognizing their unique context and ensuring they have the resources to function as essential lifelines for their regions.
David Caldwell
Okay, so it sounds like any system change has to be kind of... individualized. Like, you canât just apply the same rules to New York City and a tiny town in rural Kansas.
Sofia Ramirez
Exactly. And thatâs where this critique gets it right: applying blanket policies across vastly different regions is a recipe for exacerbating disparities. System-wide change has to be flexible enough to account for local needs.
David Caldwell
Right, but can we actually create a system thatâs both efficient and flexible?
Sofia Ramirez
Itâs challenging, but not impossible. It means engaging local stakeholdersâthose who know their communities bestâand aligning national policies with grassroots needs. The evidence shows that, when we do that, we can create solutions that are tailored yet scalable.
David Caldwell
That makes sense. But it feels likeâ
David Caldwell
So, thinking about what you said regarding funding for rural hospitals, itâs got me wonderingâhow does this idea that cutting health spending could actually improve outcomes fit into the picture? I just, I donât see how that works. Wouldnât less funding make things, you know, worse?
Sofia Ramirez
Youâre absolutely right to question that, David. And the evidence consistently shows that when we reduce health spending without strategic reinvestment, the outcomes almost always decline. Think about it: if you cut funding for primary care, for example, youâre not actually saving moneyâyouâre just shifting costs downstream to emergency rooms and hospitals, which are far more expensive to run.
David Caldwell
Right, because people canât just stop needing care. Theyâllâtheyâll end up in crisis and need even more resources, right?
Sofia Ramirez
Exactly. And what typically happens is those crises put more strain on the system, creating a cycle of inefficiency. You reduce access to preventive care, people get sicker, and the financial burden shifts to the most expensive parts of healthcare.
David Caldwell
So, basically, itâs kinda like sealing a leak with, uh, duct tape. Itâs cheap upfront, but costs you big time when the pipe bursts?
Sofia Ramirez
Thatâs a great analogy, actually. And to add to itâyouâre not only risking a burst pipe but also ignoring how those leaks might be impacting the entire system. Cutting budgets blindly often means fewer resources for frontline workers, fewer public health initiatives, and fewer safety nets for vulnerable populations.
David Caldwell
But, okay, let me push on this for a second. What about the argument that healthcare spending is, like, way out of control? I mean, the U.S. spends more per capita on healthcare than any other country, and weâre not exactly getting the best outcomes to show for it.
Sofia Ramirez
Itâs a valid point. The U.S. does spend an astronomical amount on healthcareâover $4.3 trillion in 2021 alone. But hereâs the thing: itâs not just how much weâre spending; itâs how weâre spending it. A lot of that money goes toward administrative costs, fragmented care, and redundant services. So, when people say we need to cut spending, what they really meanâwhether they realize it or notâis that we need to spend smarter.
David Caldwell
Interesting. And by âsmarter,â you mean what exactly?
Sofia Ramirez
Investing in areas that produce the highest returns, like preventive care, mental health services, and chronic disease management. And itâs not just about direct health interventionsâweâre also talking about upstream investments, like housing, education, and nutrition programs. These are the social determinants of health that keep people out of the hospital in the first place.
David Caldwell
So, wait, are we we basically saying that health spending is, uh, like... an investment strategy? Put money in the right places and you see better returns down the road?
Sofia Ramirez
Exactly. And to your point earlier about the U.S. not having the best outcomesâthatâs partly because we treat healthcare spending as a cost to be minimized rather than an investment to maximize. Countries with better outcomes tend to view health spending this way, and it shows.
David Caldwell
Alright, but hereâs my question: if itâs so obvious that investing smartly works, why isnât that happening? Like, whatâs stopping us?
Sofia Ramirez
Oh, David, where do I even start? There are so many barriersâentrenched interests, fragmented systems, and, honestly, political will. Itâs easier, unfortunately, to sell budget cuts in the short term than to make the case for long-term structural change. But the data is clear: when we prioritize investment over cuts, the benefits far outweigh the costs.
David Caldwell
Alright, building off what we were discussing about spending smarterâhereâs something Iâve been chewing on: nurses are, likeâcorrect me if Iâm wrong hereâbut theyâre the backbone of every hospital, right? But hospitals donât actually bill specifically for nursing care. Is that true?
Sofia Ramirez
Itâs absolutely true, David. And itâs one of the biggest blind spots in how we valueâand I mean financially valueâhealthcare work. Right now, hospitals bundle nursing services into the overall cost of patient care, but thereâs no direct line item that says, âThis is what nursing care is worth.â Which, frankly, is a huge disservice to the profession.
David Caldwell
Wait, so nursesâwho, letâs be honest, are probably the most hands-on with patientsâdonât directly generate revenue for hospitals?
Sofia Ramirez
Exactly. And it creates this cascading effect where their contributions are systematically undervalued. Nurses are managing patient care, catching errors before they happen, and essentially acting as the glue that holds the entire system together. But under the current reimbursement model, their work isnât seen as a revenue-generating activity.
David Caldwell
Thatâs bananas. I mean, if you look at the amount of work they doâeverything from monitoring vitals to educating patientsâit feels like theyâre running the show half the time.
Sofia Ramirez
Oh, they are. In fact, research shows that better nurse-to-patient ratios lead to lower mortality rates, fewer complications, and reduced hospital stays. But because we donât bill for nursing the way we bill for surgeries or diagnostic tests, itâs harder to quantify their financial impactâdespite all the evidence that investing in nursing improves both outcomes and efficiency.
David Caldwell
Okay, but how did we even get here? Like, why isnât nursing treated as its own standalone part of the billing process?
Sofia Ramirez
Great question. Historically, the healthcare system evolved to prioritize procedures and interventionsâthings you could easily measure, assign a cost to, and bill for. Nursing, on the other hand, has always been seen as part of the âroom and board.â Itâs woven into the fabric of care but not accounted for as a distinct service. And thatâs shaped how the entire system viewsâand compensatesânursing.
David Caldwell
So, basically, itâs stuck in this outdated mindset where what gets billed is what gets valued?
Sofia Ramirez
Exactly. And that mindset has real consequences. It limits hospital investments in nursing staff, contributes to burnout, and hampers recruitment and retention at a time when the nursing workforce is already under enormous strain. If we started treating nursing as a key revenue stream, it could shift the entire landscape.
David Caldwell
Okay, so how would that actually work? Like, what would billing for nursing care look like in practice?
Sofia Ramirez
One idea thatâs been floated is creating nursing-specific billing codesâsomething akin to how we bill for physician or therapist services. Hospitals could document the time and intensity of nursing care, tie it to patient outcomes, and justify the costs within value-based care models. It would also shine a light on the critical role nurses play in preventing complications and improving recovery times. But implementing that kind of system would require a seismic shift in how we think about healthcare financing.
David Caldwell
I donât knowâI feel like that would also give nurses more visibility, right? Like, people would finally see their work for what it is: essential.
Sofia Ramirez
Exactly, David. Itâs about visibility, respect, and fairness. By recognizing nursing as a revenue-generating service, weâd not only empower the profession but also align incentives to deliver better, more comprehensive care. And honestly, thereâs no downside. Butâ
David Caldwell
Alright, so building on what we just discussed about rethinking how hospitals value careâletâs shift to Value-Based Care. I mean, itâs been, what, thirty years since it first came onto the scene? And, uh, I think itâs fair to say the results have been... mixed. Like, if it hasnât worked by now, why would we expect it to work in the future?
Sofia Ramirez
Thatâs a valid question, David, and one that gets raised a lot. On paper, Value-Based Care sounds like the perfect solutionâshifting the focus from the quantity of care to its quality. But in practice? The implementation has been fragmented, inconsistent, andâhonestlyâriddled with misconceptions about what âvalueâ actually means.
David Caldwell
Okay, but why? Like, is it just a logistics problem, or are we talking about something, I donât know, more fundamental?
Sofia Ramirez
Itâs both, really. From the start, Value-Based Care was thrown into a system that wasnât designed to accommodate it. Think about itâweâve had decades of fee-for-service models, where providers were incentivized to, well, do more. More tests, more procedures, more hospital stays. VBC tried to flip that script without addressing the underlying infrastructure, like data-sharing capabilities or coordinated care systems, that would actually make it work.
David Caldwell
So, basically, we we put a Band-Aid on it without fixing the underlying issues?
Sofia Ramirez
Exactly. And it didnât help that the way VBC was rolled out created winners and losers. Larger healthcare systems often had the resources to adapt, but smaller clinics or rural providers? They struggled to keep up. And then thereâs the issue of measurement. Imagine being a provider trying to hit these vague, moving targets about âvalueâ without clear definitions or benchmarks. Itâs frustrating and unsustainable.
David Caldwell
Right, but isnât the whole point of VBC to reward better outcomes? Like, if this is such a great idea, why wasnât it measurable from the get-go?
Sofia Ramirez
Because the healthcare system loves complexity. Seriously, the metrics kept evolvingâreadmission rates, patient satisfaction scores, quality-adjusted life years. While those are all worthwhile to track, they donât always align with what providers actually control. And even when there were metrics, smaller practices didnât always have the tools to track them effectively. Itâs like setting a goal without giving anyone the right roadmap to get there.
David Caldwell
Okay, so if youâre, uh, a smaller provider, VBC probably feels less like a win-win and more like one of those games thatâs rigged against you?
Sofia Ramirez
Pretty much. And thatâs one of the reasons adoption has been so uneven. For a lot of those providers, the risks outweigh the benefits, especially when you donât have the resources to invest in electronic records or care coordination teams. And yet, despite all this, I wouldnât say VBC is a failureâitâs just been misaligned. It still has potential, but not without significant changes.
David Caldwell
Misaligned how? Like, what would need to change for it to actually, you know, work?
Sofia Ramirez
We need to rethink the entire frameworkâwhat âvalueâ means, who gets to define it, andâactuallyâhow we support smaller providers in achieving it. But thereâs no silver bullet here. Itâs going to take structural updates, clearer incentives, andâ
David Caldwell
Alright, Sofia, you mentioned rethinking the framework for Value-Based Careâlike redefining âvalueâ and supporting smaller providers to make it work. So, letâs tie that into the bigger picture here. Over the past hour, weâve talked a lot about what a transformed health system might look like. But before we sign off, letâs recap the high points. Whatâs our big proposal here?
Sofia Ramirez
Sure, David. At its core, what weâre talking about is building a system that learns, adapts, and evolves constantlyâa true learning health system. And our approach emphasizes five key pillars. First, lifelong health investment. We know health isnât just about what happens in a doctorâs office. Itâs built from birth to death, and our system has to reflect that by investing at every stage of life.
David Caldwell
Right, right. And, uh, the second oneâgeographic equity. Thatâs huge, especially with how underserved rural and low-income communities are right now.
Sofia Ramirez
Exactly. Itâs about designing policies that meet people where they are, whether theyâre in a bustling city or a small rural town. Equity isnât just a buzzwordâitâs a principle that should drive resource allocation and access.
David Caldwell
And then, of course, strategic investment. Not cutting budgets willy-nilly but spending smarterâinvesting in prevention, social determinants, and better care coordination.
Sofia Ramirez
Absolutely. When we treat health spending as an investment, the returns come in the form of healthier individuals, stronger communities, and, ultimately, lower costs down the line.
David Caldwell
Okay, and then thereâs this team-based compensation piece, which, honestlyâkinda blew my mind. Like, how have we gone this long without properly valuing the role of nurses and other team members?
Sofia Ramirez
Itâs a systemic oversight, David, but one we can address by aligning compensation with the actual value these roles bring. Team-based care works best when compensation models reflect everyoneâs contributions toward better health outcomes.
David Caldwell
And finally, Value-Based Care. Whichâyou knowâI feel like we gave it the tough love it deserved, but thereâs real hope for realignment.
Sofia Ramirez
Exactly. VBC isnât dead; it just needs a serious recalibration. We need clearer incentives, better support for providers, and a system that actually reflects what patients need and value most in their care.
David Caldwell
So, when you put it all togetherâlifelong interventions, geographic equity, strategic investment, team-based models, and value-based care reformsâit feels achievable. Like, this isnât just an idealistic wish list, you know? These are practical, tangible steps forward.
Sofia Ramirez
Exactly. And while the road to transformation isnât simple, the evidence is clear: a learning health system is not just the futureâitâs the only way forward if we want meaningful, sustainable change.
David Caldwell
Well, Sofia, I gotta say, Iâve learned so much todayâabout the system, the challenges, the opportunities. And honestly, it gives me hope. Like, if we start pushing for even some of these changes, weâre setting ourselves up for something better.
Sofia Ramirez
Absolutely, David. And you know, this isnât just theoryâitâs a call to action. Everyone listening has a stake in this, whether itâs as a patient, a healthcare worker, or an advocate for change. We all have a role to play.
David Caldwell
And on that note, I think thatâs a wrap. Thank you to everyone who stuck with us through this deep dive. Itâs been a pleasure, Sofia.
Sofia Ramirez
Likewise, David. And to our listenersâthank you for being part of the conversation. Weâll see you next time on âItâs Time.â
Chapters (7)
About the podcast
Everyone knows that we need to transform our health system. It's time that we do it. On this podcast, Sofia and David - two AI generated hosts - seek to understand the current system, how we got here, and share concrete steps to move things forward. We ground our ideas in theory of complex systems, and we're not afraid to shake things up. This AI podcast was created, and is managed by Dr. Chad Swanson, an emergency physician. chadswanson.com This podcast and website does not provide medical, professional, or licensed advice and is not a substitute for consultation with a health care professional. You should seek medical advice from a qualified health care professional for any questions. Do not use this podcast for medical diagnosis or treatment. None of the content on this website represents or warrants that any particular device, procedure, or treatment is safe, appropriate or effective for you.
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