2025 State of Healthcare with Joe DeLuca

This week we welcome back Joe DeLuca, a healthcare innovator and executive leader with decades of experience in transforming health systems. Joe shares his journey from scientific research to becoming a trusted advisor and problem-solver in healthcare management and consulting.

Key topics discussed:

• The current challenges and fragmented nature of the U.S. healthcare system.
• The impact of insurance companies on patient care and physician autonomy.
• Advances in medical technology, including quantum sensors and curative treatments.
• The rise of digital therapeutics and biologics in addressing chronic health issues.
• The role of AI in healthcare decision-making and its potential for the future.
• Policy insights, including the effects of changing administrations on Medicaid and healthcare regulations.

Joe also provides actionable insights on building healthier communities through innovative healthcare models, such as those implemented by Ochsner Health.

Key Takeaways:

• Healthcare remains fragmented and reactive, with systemic cost and access issues.
• Advanced technologies like quantum sensors and AI are transforming diagnostics and treatment.
• Effective healthcare solutions require public-private partnerships and community-based initiatives.

 

Transcript:

Alan Olsen  0:01

Welcome to American Dreams. My guest today is Joe DeLuca, Joe, welcome to today’s show.

Joe DeLuca  0:07

Thank you, Alan, very pleased to be back, and you’re looking great.

Alan Olsen  0:12

Thanks you. Yeah, it’s 100 pounds lighter, and I’m feeling really good. And today we’re going to get an update on healthcare. But for the listeners, why we want to be started again. Give your background of how you got to where you are today, and then we’ll, we’ll jump in on what you’re focusing in on today.

Joe DeLuca  0:29

I will be happy to so we’ve been a multi decade long career health care management consultant and operator in the field. Started back in Wisconsin, primarily doing scientific work. Has a has a bio geneticist that got me into using computers, informatics structures, that then launched a career in healthcare management consulting to use those tools to help improve the efficiency and efficacy of the healthcare system along the way. We’ve had the privilege of building companies and consulting firms and other technology firms, selling them, taking them public, shutting them down, they don’t work, and hopefully just trying to make improvements all the way along the way.

Alan Olsen  1:20

So when we look at health care today, what how do you see the state of of the industry, and where do you see this all going?

Joe DeLuca  1:29

So it’s interesting. I’m a pack rat, so I’ve been going through some of my boxes. I found my old public health notes from University of Wisconsin Madison when I was in school of health administration there, if you will. And the problems that we had back then we continue to have, we have very fragmented system that’s very costly, underperforming relative to global statistics on the health of our population. That’s there, continuing to have cost escalation and obvious concerns around that and those continue today, which is not to slight or be unaware of the significant amount of alterations and adaptations that have occurred in the system, which are very powerful and meaningful for certain populations that are out there through tools and techniques and therapies that didn’t exist before that have and continue to progress to help vulnerable populations, as well as people who are in need of that. But from a macro level, we continue to struggle with. It’s really some ways hard to call it a system, as opposed to a patchwork of different service organizations and reimbursement models, which are trying to come together to help a public citizenship, if you will maintain health at first, because if you’re healthy, you really don’t need health care. One of the discussions we had in one of our previous discussion sessions was the distinction of health care systems, a John Muir health and Intermountain Health Care, moving from I’m a care delivery system primarily focused on treating acute care and some prevention to I’m a health company. I’m really here to sponsor the health of my community around me. We haven’t really progressed that. I want to talk about a couple of examples of that that have been successful, but we still work in this reactive world, and call it a health care systems and then try to have a payment model based off of an insurance company model that that, frankly, is not working.

Alan Olsen  3:53

And I hear I hear that I’m sorry. I hear that, more often than not, that the insurance companies are kind of dictating to the doctors, well, we’ll pay for this, but we won’t pay for this. And and so in some ways, the doctors are feeling like their hands are tied. They go to medical school, but they’re told what they’re allowed to do.

Joe DeLuca  4:14

It is very distressing, and the recent murder of the United Healthcare CEO in New York City, Brian Thompson, has really brought further vitriol, and there’s no other way to say it than there’s virtual in the system between physicians patients and health insurance over how These whether it’s authorization denial or utilization review denial, I was quite surprised, as well as many in the healthcare community over postings that occurred on professional sites and chat boards and so forth, who basically felt that there was a justified vigilante function in. In his murder, which is, you know, frankly, absurd, but you then look at the postings of some of the denials that occurred, and at the end of that denial or failure to authorize service, there’s, there’s a human being there, there’s, there’s a loved one, there’s a father, there’s a mother, there’s a son, and many times that denial of services is resulting in greater morbidity or mortality of that loved one. So in the end, the vitriol is coming all across, not just from patients, but coming from healthcare providers who are out there and it’s really counter to the concept of why we buy health insurance. I mean, when I understand the need to distribute risk, we understand the need to have some level of fraud protection that’s out there. That’s where a lot of this actually started, and it is now moved into a corporate denial. Frankly, for profit, there’s really no other way. And by the way, people would just somebody, some of the healthcare execs, I’m sorry, some of the healthcare plan execs would debate this dramatically, but it really has gone to a profit motive, at least with the large companies, you can’t see the amount of money that’s being given back to shareholders and say that, that it’s not there. Now that being said, there have been a lot of legislative efforts to help on this. For example, there with part of the Affordable Care Act, there is a requirement that a certain amount of money a threshold has to pay out from a health plan to go to the actual provision of services. And if you don’t hit that threshold, the the delta between that threshold and what you actually paid, which would be lower, has to go back to your members has a refund check. My family’s actually gotten some of those checks before, so it’s been some intent to do that. There’s state by state legislation that’s coming into play. Texas, for example. Small example has one that that says it basically, if a physician has a 90% approval rate on an authorization, you have to give them a gold star, if you will. And you can’t, you can’t review them anymore unless you have reason to come in and say they’re being fraudulent or an over utilizer. So that that’s the dysfunctional part. We continue today to say that over 50, roughly 50% of the population is either uninsured or underinsured. So there was a large component of of the Affordable Care Act to get citizens, if you will, to get people on Medicaid. That’s great, but Medicaid is, at best, a stop gap insurance. It’s hard to get physicians to actually take Medicaid patients in some areas of the country, there’s they don’t pay enough to really survive it. So we have moved more and more towards a cash based economy for our health care services. My family in our our high deductible health plan. For the last 1215, years, we have hit our deductible once, maybe twice at the individual level, I don’t think we’ve ever hit the family deductible. So when we need to have an imaging service done, we go first for price. Who’s the cash price that’s out there? And interesting enough. Alan. We’ve also found that in some cases where we end up going they have newer and better technology than if we would have gone into one of the academic systems and been charged three times more on our deductible for that. And I think that’s more and more. We talked about it briefly in one of our previous sessions, that that we were moving towards alternative provisions that had a cash focus to it, or an electronic health focus to it. Clearly there today and continuing that that progression a long way of saying it’s a mess, and sadly, it’s been a mess for decades.

Alan Olsen  9:23

So I want to move into the area that the tele doctor had, that we had the GLP-1, you know, that has taken quite an impact on helping individuals with obesity and diabetes to lose weight. What’s your take on these medication and the impact that they’re they’re having.

Joe DeLuca  9:42

So bimodal. I think it’s absolutely wonderful that people who struggle with weight loss for whatever reasons. It could be motivational, could be family history, it could be biological, relative their system and physiology. G of it that there’s an alternative that can help them reduce their obesity, get to normal weight level, and basically, as you know, is better than i There are many Associated Diseases with obesity that you want to get out of your system, so to speak, and that there are huge medical costs associated with it. So I think that’s all great, the concerning part about them, one cost, but that’ll come down, and that’ll sort of be forced down. And second is a lifelong dependency on using GLP one, and what is the issues associated with a weaning process? I was mentioning that to Aaron and the sort of pre work for this that there are insurers who are paying for GLP ones because they’re not widely covered right now by insurers. They’re very selectively covered. There is in the Biden administration, and we believe the Trump administration will probably reverse this. The Biden administration is trying to get Medicare and Medicaid to cover this. Of course, if they cover it, the private insurances generally come on board. And it’s not clear the Trump administration, they really have not stated, at least has of yesterday, that I could find a policy position on this. So if they’re not covered, it’ll continue to be a cash based program. So some employers, though, who ultimately, as you know, paid on the health care bill, have said, well, we’ll go ahead and Pam, you know what we’ll pay for through a supplemental program. But we also are going to mandate counseling on reduction when you’re weaning off of it, so that you continue to achieve those weight loss gains and other benefits associated with it. So I think it’s I think it’s great that that they’re out there. I think that the market will start to bring the price down, and then it’ll, you’ll have some other implications in the population, relative to, how do we inform them?

Alan Olsen  12:14

You know, switching over to the future, before we talked about it, you know, the approaching Star Trek medical technology. Where are we today? And how has that progressed?

Joe DeLuca  12:28

It’s interesting. It’s actually progressed. The Star Trek suit may have been may have been appropriate. So in particular, there’s technology, computing technologies, out that have developed into what are referred to as quantum sensors based off of quantum based computing, which is instrumental the quantum based computing is in essential to the analysis of massive amounts of data and into Things like how a way more car is basically able to not that they have a quantum computer necessarily in them, but how their algorithms were developed. So there are now, there are now quantum sensors out there that in particular in cardiology, orthopedics, neurology and and some areas, like Alzheimer’s detection, are able to scan your body, not have to do a radiation based intervention or an MRI, and pick up on the subtleties of molecular changes that are either persistent in, for example, the formation of the Altoids in your brain, or in cardiac rhythm changes, or cancer detection. So basically, you scan, they’re portable, they’re inexpensive. And by Count, I was out on one of the websites, there were roughly a couple 100 of them in the FDA approval processes right now, in the US and course, internationally, there are some areas of the world where adoption can occur a little bit more quickly. So I haven’t gone into that yet, but it’s moving along to where there’s a scan approach and an ability to then diagnose, or at least get some information without having to go through an invasive procedure. That was one of the things we talked about back then.

Alan Olsen  14:33

You both then talked about the curative technologies. Can you describe this and provide us with a few examples?

Joe DeLuca  14:40

So curative technologies, we are somewhat familiar with them. If you have a strep throat, you get an antibiotic, and that cures that particular infection, if you will. So that’s a form of a curative technology. When I was using the term, it’s really talking more out at the end of the curve, where. There is a intervention which permanently changes something in you that was underlying for a particular disease. In particular there’s been work done on the genomic side of that, if you will. So for example, I have to look at my notes so I make sure that I frame this state this correctly. But there have been, soon as I can find my note again, there have been numerous there we go approaches, for example, with severe, combined, imminent deficiency disease, which otherwise known as bubble boy, where there is a gene insertion technology that actually then cures the underlying genetic defects in that individual and cures the disease that one in particular has had some consequences of one out of 10 individuals who want to go that will will die from the procedure that’s associated with it. But there are, right now, about 1056 curative per the FDA, curative treatments that are in clinical one through four trials that are out there and range all the way from hepatitis C curative technologies to retinoic dysfunctions. So tremendous potential there, and a new type of curative technologies, and I’ll put in quote, which is called Digital therapeutics, where, in particular, with autism, certain mental health disorders, addictions, where through using visual digital technologies and also spatial movement, you can retrain Your brain that that will help you then not relapse. Learn how to cope more in the normal world, depending on where you’re on, on, on the like an autism spectrum. So so we are encouraged by those and then last but not least, a technology called biologics, where you get injections. That’s more of a of a effect that is controlling a particular problem or processing in your system, but over time, is basically curative, because you’re no longer haven’t had the effect of that can change your physiology.

Alan Olsen  17:42

Artificial Intelligence is current wave of excitement in all industries, and of course, healthcare. What impact is AI having in healthcare today and tomorrow? Very,

Joe DeLuca  17:57

very good question. Obviously, so in healthcare we have had, if I view AI along a continuum of machine learning, we have used machine learning for decades in healthcare as fact, right now, there are 1016 FDA approved AI machine Learning medical devices and algorithms that are incorporated into that. We historically have also always introduced a concept called competent human intervention, so that if an IV pump in a hospital is using an algorithm and machine learning, AI driven algorithm, and it says, I don’t stop this medication, because Joe’s overdosing on something, there’s a physiological response happening. Does a hard stop. It also alerts in a competent human comes along and sort of reviews it. So what we’re seeing today is an expansion of that in two areas, first to where the AI tools and all of the new technologies that are behind it they read about, are creating its own patterns of decision support behind it, and that’s very powerful for researchers who are out there, for physicians, even as simple as taking a note back to a patient and making it more humanistic, adding empathy to it, clarifying, adding in educational material that the physician who’s writing it in a very busy work day would not have been able to necessarily do that, but at The end of the day, someone so it’s a look at and say, Hmm, okay, was this, was this right? Did I give them the right information? As we move more towards the AI system, having autonomous decision making, that becomes a little bit more of concern and a little bit more. Are problematic. So I think we have greatly overestimated in the short term what AI will do in medicine. We’ve greatly underestimated it in the long term, when we go back and talk about the healthcare claims denial and authorization denials, there is a belief that a lot of this is being sponsored by more autonomous decision making, whether or not it’s true AI or some machine learning that’s there, that’s sort of a different issue. It’s really interesting. I mean, for like, you know, our children and grandchildren on this, this is, it is hugely important that they understand what can be done and what can’t be done. I just recently read a British Medicine Journal article that went and assessed the mental mental competencies of many of the popular AI systems along human human scoring systems, and found that they actually degrade over time in their ability to reason and sort of keep up the date with information. So it’s fascinating, absolutely fascinating, but it’ll be a very it is already an important impact there. Just as a quick aside, I’ve been at JP Morgan most of this week in San Francisco. Watch, and yesterday, I was walking by the West End, and I was watching a Waymo car turn, which is heavily based on sensor technology, visual sensor, and also on machine learning. And I watched it do a complex, heavy traffic three lane merge to then get over, avoid hitting a police officer who was standing there to pull in to pick someone up. And I was like, Okay, there’s, there’s, there’s some real stuff here. There’s some there, there in this.

Alan Olsen  21:56

Well, we certainly live in an exciting time. Talk about exciting times. We’re about ready to have a new administration coming. Uh, can you give me your take on the Trump administration? I guess, particularly, he’s appointed RFK to come in and help with the healthcare

Joe DeLuca  22:11

Yeah. So I’m not, not too, not too sure about what impact that will have, but at the global level, you know, the Republicans and Trump in particular, less regulation, pushing more activities, more responsibility back to the States, which is also important in health insurance, because health insurance, at the end of the day, whether maybe some federal standards, it’s regulated state by state. And so there’s, there’s clearly a drive towards that. Some people believe that is good. Some people believe that is not good. That’s that more standards are needed. I think on the Medicaid front, there’s been a clear indication they’re going to cut Medicaid funding, and that they want to part of that way that they want to cut it is by giving block grants out, which will force the states to then pick up more or to cover less that’s associated with it, do some reforms in Medicare, some of which are, I think, very good. There’s a strong component of their view, which is to support aging at home processes more community based home care and more social services around that that are associated with that. So I think it’ll be, we live in interesting times, and I think those will will push out. We don’t see right now, a large movement towards, we’re just going to completely repeal the Affordable Care Act that was there because there were a lot of good components on it. I think last time we talked about it, and I thought it did not go far enough in establishing cost controls, a value based care, those kinds of things that would have assured that as we pushed more money in the system, we got more value out of the system that was there, if I could add one framing thought closing thought on this, if the audience is interested in really understanding how this all comes together, take a look at Ochsner healthcare in New Orleans. Ochsner healthcare sort of a public health, private safety net system heavily dependent on Medicare. Medicaid funds took an approach where they basically said, we’re not going to be getting any more money out of these organizations, so we have to make our population healthier. So we’re going to invest in community based tools, simple things, in some cases, such as for a pregnant woman, go ahead and give them biometrics that we can then monitor, to help them to monitor their biometrics and physiology, and see if they need to be coming in without them having. To come in to the services, and they just published some reports on this. And it’s an amazing micro view, although, if you’re in New Orleans, it’s not a micro view, it’s very important, but it’s a small view of what we would like to see nationally, if you will, with public private partnerships, working with social service agencies and really recognizing that your role has a health care provider is about health and that health extends out in the community. There are other examples of it, but they just published some, some wonderful statistics on that in a way.

Alan Olsen  25:37

Joe, it’s been a pleasure having you with us today on American Dreams. If a person wants to reach out and take advantage of expertise and bring you into some of their projects, how would they reach you?

Joe DeLuca  25:47

Come out to LinkedIn. JM DeLuca on LinkedIn. Joseph DeLuca, my contact information out there. You can reach me through a direct message, through an email or through a telephone call.

Alan Olsen  25:59

Thanks again for being with us today.

Joe DeLuca  26:01

Alan Olsen: My pleasure. Thank you Alan.

 

Previous Episodes with Joe DeLuca:

Approaching “Star Trek” Like Medical Technology

The Future of HealthCare