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Bartiromo: AthenaHealth's CEO talks health care, tech and cousin Jeb Bush

Maria Bartiromo
Special for USA TODAY
Maria Bartiromo

Health care was one of the few industries that saw job creation in the month of June because of a revolution going on in the industry. We are living longer, getting in front of disease and monitoring everything from our fluids and heart rate to our digital records. All of this as premiums are going up and the Supreme Court rules the Affordable Care Act will stay the law of the land. I caught up with one of the leaders in this new marriage between health care and technology: AthenaHealth CEO Jonathan Bush who is providing cloud-based services for electronic health records, revenue management, and other point-of-care apps that are changing the way we approach health care. I also asked him about his first cousin who is hoping to occupy the White House in 2017. Our interview follows, edited for clarity and length.

Q: What is the state of business today?

A: AthenaHealth is tapping into a very wide frustration amongst doctors and their patients in the country that nothing is connected. You go one place and you are given a clipboard, which is annoying and takes a while. And then somebody talks to you about it. And then you go somewhere else and you have to start all over again. And so everyone's ready for that to end. And Athena's the only company that's got a sustainable business model to make that happen.

Q: So in other words, really digital health?

A: That's right. A basic information backbone. When I think of the health care Internet, I think of a chunk of the Internet, much the way Amazon took a chunk of the Internet and made it secure enough, reliable enough and connected enough to the offline world for mainstream Americans to trust with their credit cards and shopping choices. We are trying to create a chunk of the Internet that is safe enough, reliable enough and connected enough to the offline health care world that doctors and their patients will trust in the same way. And we're tracking pretty well so far.

Q: The big question, of course, is the privacy of the data.

A: There's no such thing as perfect protection that's useful. You can make something perfectly protected in a way that no one can see it. Obviously there are always mistakes and there are always losers who want to make a name for themselves that will be in the way. But the risk-reward trade for doctors and consumers is so vast. The lives that are lost, and the humiliations that take place, and the waste, the financial burden in people's lives is created by duplicated isolated health care information. It is so vast that the majority of us are happy to make the trade. In fact, if you look at the companies that were recently very publicly hacked, their stock price didn't move much. And their market share moved not an inch. Because most people, while they're mad about it, know it's still the trade that is worth making.

AthenaHealth CEO Jonathan Bush

Q: So how does the Supreme Court decision on Obamacare change health care?

A: I am and will always be against Obamacare. I wish it didn't happen. But it did happen. And I'd like to be working within the framework that we have to make things better. And free market people can do that within Obamacare. Very few people changed roles within Obamacare. We still have the plurality of lives in the hands of commercial employers that have to pay for their employees' insurance just like before. We need to start working on getting that product more consumer facing.

Q: In the midst of this, we've seen this major consumerism going on within health care. You could select a Rite Aid. Or go into a HealthSpot and speak to a doctor on an iPad. You can get your blood taken by a Theranos, in a Rite Aid or in CVS. What's happening in terms of the consumer space within health care?

A: It's a great point because the demand curve is very broken in health care and it's getting fixed with the rise of consumer responsibility for these high-deductible health plans. The retail clinics did a wonderful job of creating a supply and demand that wasn't price and share but convenience and share. And it's playing beautifully into the emergence of price and share because they're also doing doctor visits and other consumer responsibility care very affordably. They're getting cross-sale and brand identity. And they will get lots of other things in the years to come out of that move.

So the rise of consumer of convenient care, whether it's through the retail clinics you mentioned or urgent-care chains. There are hundreds of millions of dollars of private equity investing that has been put into dozens of multi-state chains of urgent-care centers that compete with emergency rooms. They're a lot cheaper, but they primarily compete on convenience. They have a five-minute wait instead of a five-hour wait. And they can do 70% and 80% of what an emergency room can do. And once that happens, and consumers say, "Gee, there are brands that I can learn to trust the way I can in other aspects of my life. They're going to take care of me," we will see a lot more collapsing of the information silos. Because when the local hospital says to Target corporation, "Hey, I want you to get onto my computer systems," Target says, "Hell no. You will connect to us. I'm Target. I'm nationwide." I think the rise of the convenient care movement here in the country is probably one of the most important developments that we've seen this decade so far, and not just about the convenience aspect for the consumer, but the impact that they will have on the demand curve of the whole system.

Q: We have also seen a huge string of deals. The consolidation and merger and acquisition activity has been most prevalent in health care. Why do you think that is?

A: For companies in this business, death is not allowed. So the elegant death is a merger or a sale. Particularly in the health-insurance space, there have been many mergers. They are restricted by government from doing much product management. One of the many things that was wrong with the Affordable Care Act was it made sure everybody was required to have the exact same product. So it's government-mandated commodities. It is very hard to emerge and grow your business through creative new product design when you're not allowed to.

So, basically they're down to mergers of administrative efficiency, which we've seen in lots of mature industries. Airlines. Cars. And we're seeing it in health insurance. What needs to happen to make that a good thing as they sort of quietly die away is other entities emerging underneath them, disruptive technology to take over their role in society and do it better. And we're seeing that. One of the most important deals we've seen in the last couple of years was the acquisition of HealthCare Partners by DaVita. You had a huge renal care company that took over what amounts to a really big primary care medical group. So they're basically in that medical group kind of secretly doing 80%, 90% of what a health insurance company, or a new age HMO back in the '90s, used to do. They're doing it better. These mergers will neuter and ease out the big, tired, academic hospitals that are merging and the big, tired third-party insurance companies that are merging and make room for new players.

Q: So how do you see the world changing in the next 5 or 10 years? And tell me how Athena fits into that.

A: The most important thing that I think about health care over the next five years is that this Internet thing is going to be big. Every other industry has gone to the cloud. All of the dominant, feeble systems-type players have faded out. And everybody's on the cloud. And so the pace of innovation is strong, The level of connectivity is almost instantaneous all the time. I expect over the next five years those last three remaining companies will fade. And a whole family of emerging companies will arrive. And I'm very much trying to be a mini-me of Jeff Bezos in that regard and trying to make room for lots of new companies to sell right through to our clients and patients with their new technologies using our applications. So when Bezos forced through architecture of Amazon to allow everybody to sell through that window — even competitors — he made a really important move, in turning that thing into a retail Internet utility rather than a particular player. And my aspiration is to do the exact same thing in the next five years. There'll be tons of products emerging, and growing. And health care information won't be lost. It'll just be shifted elsewhere on the Web the way other apps that we delete from time to time are.

Q: There are a lot of changes and big ideas happening in health care.

A: Absolutely. the emergence of new players, the commoditization and merging of the old players and the emergence of the consumer, first through just convenience and then through actually having to pay for stuff.

Q: Let me ask you how it feels to have a famous first cousin? Can you tell us something about Jeb Bush that we may not know?

A: Jeb doesn't have an entitled bone in his body. Not even his pinky. His journey is one of genuine passion to serve.

Maria Bartiromo is the anchor of Mornings with Maria on the Fox Business Network, broadcast live from 6 a.m.-9 a.m. ET. Follow her on Twitter @mariabartiromo @MorningsMaria @SundayFutures

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