Outcomes Rocket _Tony Benedict: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.
Saul Marquez:
Hey everybody! Saul Marquez with the Outcomes Rocket, welcome back again. Today I am privileged to spend some time with Tony Benedict. Tony is an outstanding business leader, currently Chief Executive Officer at Omicron Partners, but man, he has done so much in healthcare. He’s worked in leadership roles both in healthcare, the healthcare provider space consultancy, as well as tech. He had many leadership roles at Intel. From there, he went to Tata Consultancy Services, where he played a major role in building out their portfolio in strategy and operations. Then he served as Chief Information Officer and VP of Supply Chain, both roles at Tenet Health, where then he led, his career led him to HonorHealth, where he served as vice president of procurement and supply chain. Today, he’s helping many leaders across both the healthcare and normal business sectors manage rocky roads in the provider space, but also in the general economy. So it’s such a privilege to have him with us today, and, Tony, I just want to say thanks for joining us.
Tony Benedict:
Well, thanks for having me, Saul, great to be here. Looking forward to the discussion.
Saul Marquez:
Likewise, likewise. So, look, we talk healthcare here and I know you do more than that, but the healthcare is a core of what you do. What inspires your work in the healthcare sector, Tony?
Tony Benedict:
I have been working in other industries, obviously, and I got recruited into healthcare. What I noticed was that the industry itself is probably about 20 years behind other industries from a technology perspective as well as an operations perspective. You could get into all the different reasons as to why that’s so, but I felt like I could bring a wealth of experience and knowledge to the industry and maybe leapfrog that sector, or at least my part of it in that sector, ahead a little bit. And so that was the inspiration and the passion for really getting into healthcare.
Saul Marquez:
Love it, yeah, there’s a huge opportunity for us to get better, modernize, optimize. And so you brought your talents from tech at Intel, from Tata, and so you dove in, you dove in head first. And so talk to us about specifically some of the things you did, but maybe we could use this time to hone in on, on your business today, Omicron Partners. What are you guys doing and how is it benefiting the healthcare ecosystem?
Tony Benedict:
Sure, so a lot of what I try to do is, and I don’t like the term, but I don’t have a better one for it, is bring, you know, you’ve heard the term best practices, but really I would characterize them as forward-thinking practices to an industry that’s really starving for that kind of knowledge and experience. And so keep in mind, when I joined the healthcare industry in 2010, you know, the use of technology was very, very limited. The supply chain in healthcare, to me, was very, very behind the times. You know, they relied way too much on GPOs or group purchasing organizations and you know, they’re not and I’m not anti-GPO, but they’re not the thought leader in healthcare. They never were, and they probably never will be. And that’s my observation and my experience. Anything that gets innovated in healthcare doesn’t come from a GPO, it comes from outside of healthcare or a health system doing the right investments. So I was fortunate enough that when I got recruited, I got recruited into a for-profit provider that was backed by private equity. So we had our own venture capital fund. We had private equity, honestly, really breathing down our necks. And so the pressure to innovate, do things differently, and really change the game and healthcare was there from day one when I joined the company. At that time, it was Vanguard Health Systems. They were later bought out by Tenet after they went public. And so, you know, what did I try to bring? Well, just better organization. I mean, quite honestly, I was surprised that no one really was trained or disciplined in project management, where in other industries, if you’re in supply chain, the first thing you learn how to do is project management. You either go out and take a course or somebody comes in and does a three-day boot camp for you or something like that.
Saul Marquez:
Tablespace.
Tony Benedict:
And so, you know, I started doing things like that. I restructured the organization. I hired some talent from outside of healthcare. I did a three-day boot camp on project management for my entire staff and opened it up for all the executives. We started doing things, a lot, differently. And the scope of supply chain in healthcare is beyond just supplies and pharmacy, it goes to purchase services, it goes into construction, it goes into facilities, you know, etc., etc. And so it was more all-encompassing after I got there because again if you write a check for it through accounts payable, it should be under your scope of influence, if you’re being tasked to reduce the cost of doing business. That was a major change at that time within healthcare in general, within Vanguard, again being private equity-backed, they expected, I came from outside the industry, so they expected something different from me because I came from outside the industry. They had seven people before me that were all healthcare, they only worked in healthcare. And so they would get the same old, same old with these people and they wanted something different, So.
Saul Marquez:
What did you give them?
Tony Benedict:
What’s that?
Saul Marquez:
What did you give them?
Tony Benedict:
Well, again, I brought in an outside perspective. I completely restructured the organization, hired outside talent, brought in some other disciplines like project management, completely retooled value analysis. I worked in the pharma industry and basically sold drugs to doctors, so I knew how to talk to doctors and convince doctors and influence doctors kind of the way medical device manufacturers do today, right? So engaging physicians in value analysis was something that was not done or not done very well. So things like that. But I really brought in more of an integrated approach, right? Increase the scope, tackle everything that impacts the operating expense and EBITDA, and then have an integrated approach across all those categories. And then really made the GPO more subservient to the provider as opposed to being the, you know, the, I don’t know, they were kind of the dictate, right? Whatever the GPO says we should do, well, I disagreed with that. They’re there to provide us with support and service, we take advantage of their contracts when they save us money, but if they don’t, then we’re going to do something else, and that’s what we started doing. We started a lot of stuff contracting, we didn’t have the volume to really set up our own distribution center. I’m not convinced that’s the end-all, be-all in healthcare either, but it does do a lot of things that take a lot of the fees out of the mix, right? So you’re not paying distributor fees anymore. You could literally contract directly and get rid of some of the GPO admin fees, even though they say they rebate them back. They do, but they don’t give you all of it. They tell you they give you all of it, but they don’t, and I know that for a fact, but they’ll tell you that their admin fee is 3% or 4% and they give you 100% or 80% of it back. Their fees are as high as 8% now. That’s not public knowledge in terms of is it advertised by the GPO? No. Do what, do the insiders know? Yeah, all the insiders know. So again, it’s really digging in a little deeper and really making some changes. GPOs obviously don’t want providers to know that they’re charging more to vendors than they’re giving back to the providers. But that’s a reality, right? So again, I’m not anti-GPO, it’s just there’s a role for them and it’s not as big as they would like it to be, but they want to be the dominant force in healthcare, and I don’t think they are, they shouldn’t be.
Saul Marquez:
Hey, that’s fair, right? I mean, you’ve got to call a spade a spade. And so you did away with a lot of these things. You revamped the system. You guys started having success. How about things that didn’t work? I feel like, well, Tony, we learn a lot from setbacks, maybe even more from our successes. So talk to us about one of those and what learning came out of it.
Tony Benedict:
Again, I hate to kind of bring this up probably a little too much, but in order to innovate in healthcare, you really have to experiment and do things on your own. Again, they’re not going to come from the GPO. And so I think one of the bigger challenges in healthcare is they do not like change, providers do not like change. One of our chief medical officers said to me, we were talking about one of our administrator colleagues, and his comment to me was, he’s a coaster. And I was like, a coaster? And he said, yeah, they just kind of coast along in their career, they don’t do anything that’s going to be disruptive. I said, got it. I said, there’s a lot of coasters. And we both started laughing. My point is, is when I was in the pharmaceutical industry, we dealt with hospital systems back then and that was before managed care and everything else. I can tell you that back in the late eighties, early nineties, what was going on in healthcare still goes on today. So you’re, what, 30 years, 30 plus years in the future now? Not a lot has changed, right? Are there newer technologies? Are there electronic health records? Sure. But the fundamental business model for delivering care to patients has not changed in 40, 50 years. There’s still Medicare, there’s still restrictions, insurance companies still do the same, they make you jump through hoops to get any kind of care, and it’s really not a system built around the patient, even though there’s a lot of talk about that. The walk and the talk are very different. And that’s the part that really needs to change. And so that’s my big disappointment, is you don’t really see a lot of health systems tackling change in a way that benefits patients, it just makes it more difficult. You know, I had the, my mom is at that age now where I moved her out closer to me and actually had to take her to the emergency department. And, you know, the workup that they do, knowing what I know, I was a little disappointed that they did the workup that they did and the treatment that they did. But when I realized what was going on, there, it’s really all about maximizing billing on your insurance plan, right? Let’s do these five tests. Let’s do this, this and this, blah, blah, blah. You’re in the ER for 4 hours, and, you know, my mom left and didn’t feel much better. They did a couple of things. But, so, again, that whole business model is not, it’s not really patient-driven to really get the best outcome possible, and I’ll just leave it at that and I’ll come off my pedestal.
Saul Marquez:
No it’s all good, look. Sorry to hear about your mom. Sounds like.
Tony Benedict:
She’s doing better, but I used her as an example because you live it, right?
Saul Marquez:
Yeah, yeah, yeah. And you didn’t, she didn’t get the care that you wanted her to get, and I feel your frustration, Tony. And so if you think about healthcare trends or technology, you mentioned there’s some new tech in there. What’s one of those things that you believe will change healthcare as we know it today?
Tony Benedict:
I do think telehealth is probably one of those things. I actually have an appointment for my mom tomorrow with a rheumatologist, it’s a telehealth appointment. I could not get a physical appointment in her office till like mid to late June. And so doing a telehealth appointment was the next best thing and it was a lot sooner in terms of getting an appointment.
Saul Marquez:
Nice.
Tony Benedict:
And so I did it with my father before he passed away. And they’re actually pretty effective up to a certain point, right? I mean, if they have to do a physical exam, you, obviously there’s a limitation there. But once you get through what I would call the fundamentals of what they need to do to evaluate you, the patient, they’re pretty effective. I also think the patient monitoring technology that’s out there today is going to get a lot better. It’s actually pretty good now, with respect to monitoring patients with chronic problems, whether it’s congestive heart failure or asthma or diabetes, etc., being able to monitor people and putting it on a smartphone or some sort of these watches, like an Apple Watch or an Android watch or whatever, pretty significant. I do think that some of the challenges, though, with the technology are the fact that not everybody’s tech-savvy, right? My mom is 82. She has an iPhone 11. She knows how to make a phone call. She can’t text, you know, she doesn’t do email. But part of it is she doesn’t want to. But the other part is she doesn’t want to learn something too complicated at her age, right?
Saul Marquez:
Yeah.
Tony Benedict:
I think I think somehow over time, that’ll get better, whatever it may be, right? By the time I’m 82, I’ll be able to do I mean, I do that stuff now, but I won’t really be resistant to it, hopefully, and it should be a lot easier by then, right?
Saul Marquez:
Totally, yeah, no, those are great, great examples, Tony. So some spots of hope and progress for sure. I certainly appreciate your candid perspective. And this is just a little snippet of an opportunity to connect with you. Look, if people want to dig in with you, connect, what’s the best place for them to do that? And then and then finally, any closing thoughts you want to want to leave us with?
Tony Benedict:
Sure, I mean, if you want to connect with me, I would say the best place is on LinkedIn. And once we connect, we could kind of go from there, jump on a call, whatever. Be happy to have a conversation with somebody that’s interested in doing something different, whether it’s in healthcare or not. Business transformation is business transformation. And you’re really doing a lot of process improvement, transformation type work for your business, your whole business model. So be happy to have those kinds of conversations with anybody and the other part of your question, Saul, was, I’m sorry.
Saul Marquez:
No, that’s okay. Any closing thoughts? What do you want to leave?
Tony Benedict:
Yeah, I mean, there’s probably a lot more to talk about in terms of what’s really going on. And I just read an article this morning and it was actually very good. It was an article about CEOs should not follow trends or not get too enveloped in trends because they’re their fads, a lot of them are fads, right?
Saul Marquez:
Yeah.
Tony Benedict:
And so when, when I think of technology trends, every year, there’s a whole new set, right? There’s either five new trends, ten new trends, whatever. And a big part of that is technology vendors trying to sell their latest and greatest, right? It’s, and most of it’s unproven. And so the message I would leave with people is if you’re really thinking about doing some sort of transformation and you believe that you need technology to do it, reach out to me and I’d be happy to put some perspective on where technology is going to help and where I think some of the basic building blocks are going to help, like really just possibly reorganizing certain groups to do a more process-based approach for improvements, operational improvements or whatever it may be. But not every technology is going to change your world for you, and I think that’s part of what I think is misunderstood out there with all these different kinds of technology trends. So I’d leave people with that. Don’t jump on every trend. Be happy to advise anyone who’s really thinking about embarking on a major initiative with a significant investment.
Saul Marquez:
Love that. Tony, appreciate that offer. And folks, definitely take Tony up on it. I mean, we’re talking decades of experience in both tech and also sitting in the seat of a CIO or VP of Supply chain for some major health systems. So definitely check him out. We’ll leave links to his company, to his LinkedIn profile on our show notes. So take advantage of that. And Tony, just want to say thank you. Appreciate you taking the time for today. I know you’re a busy man and so appreciate you connecting with us on the Outcomes Rocket.
Tony Benedict:
Thanks a lot for having me on your podcast, Saul, and a pleasure, and be happy to do it any time. Thank you.
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