Louis Bernardi With BritePath

Intro: [00:00:02] Broadcasting live from the Business RadioX studios in Atlanta, Georgia. It’s time for Association Leadership Radio. Now, here’s your host.

Lee Kantor: [00:00:17] Lee Kantor here another episode of Association Leadership Radio, and this is going to be a fun one. Today on the show we have Lou Bernardi and he is with BritePath. Welcome, Lou.

Louis Bernardi: [00:00:28] Thank you. How are you doing, Lee?

Lee Kantor: [00:00:30] I am doing well. I’m excited to learn what you’re up to. Tell us a little bit about Bright Path. How you serving folks?

Louis Bernardi: [00:00:37] So Bright Path is an independent insurance agent here, agency here in New York. This is our probably our 25th year in business. And we go by the name the DBA of Bright Path the past few years, because that’s really kind of serves as both our our our call to action, our our benefits strategies. And we wanted to put that out there front and center.

Lee Kantor: [00:01:02] And then your role there at Bright Path, I know you’re a founder, but you also are called the benefit optimization officer. Can you talk about that?

Louis Bernardi: [00:01:11] Yeah. So benefit optimization officer, I coined that phrase within the past year. You know, I was a general agent for about 25 years, which essentially means I was a brokers broker helping other brokers serve their clients employee benefit needs. And I just really know I wanted to rebrand myself and I wasn’t happy with the terms that most people use. Broker, consultant, advisor, because I really didn’t feel that that fit what I was trying to do, which was be more of a something almost like an outsource CFO. I want to be that outsourced blow or boo that works very closely with HR directors, CFO CEOs. I like to call them benefit decision makers because there’s some there’s some tricks to the trade and tools and and knowledge that they they simply really can’t get on their own. You have to really dig deep. And so that’s really kind of serves as a rebranding for myself. And it’s it’s taken off.

Lee Kantor: [00:02:11] And it sounds like it’s kind of almost a mindset shift in how you’re viewing your organization in terms of it’s not a the services in the transaction. This is a relationship based service that we’re partners and trying to really help each other symbiotically, you know, get to a better place.

Louis Bernardi: [00:02:35] You know, it’s even more than that. I tell people all the time, it’s it’s taken me 30 years to get five years of experience. About five years ago, I had the almost by accident came across the prices, the prices of health care versus the cost of health care. And I was pretty surprised and I realized pretty quickly that, you know, there’s a lot of deception in health care and health insurance. The consumer is completely left in the dark, although there are some new laws that that mandate transparency and frankly, the health care system, the hospital monopolies that exist in most cities like Atlanta and here in New York, they’re not complying. And they and they they benefit significantly by keeping the consumer in dark, you know, in the dark. And, you know, we want to expose that. I’m part of several different organizations that are really committed to creating a more informed consumer, both of the employer and and their members. You know, when you when you purchase insurance from your employer, you’re called a member. But when you go out and use it, you’re a patient. And patients don’t have any clarity either.

Lee Kantor: [00:03:45] So as one of those organizations, health.

Louis Bernardi: [00:03:47] Rosetta It is health. Rosetta Aspirational health care, talent, champions council, free market medical associations. These are all different organizations that are similar in nature. They, they are, they are made up of benefit advisors or Booz like me, as well as thousands of solution partners, CPAs, insurance payors, health care systems that are really committed to helping to create a more informed consumer that can that can help to drive down prices instead of this perpetual pay more get less than that we’re used to.

Lee Kantor: [00:04:28] Now as a business owner, you have a lot on your plate just from that. Why was it important for you to get involved in these kind of associations and organizations almost for the greater good of the whole ecosystem?

Louis Bernardi: [00:04:44] I If it weren’t for organizations and the collaboration that I get, the sharing of knowledge, the sharing of experiences, this would be going so much slower than it is. The honest truth is that there’s a lot of people more advanced than than me and my agency there throughout the country. And we get together virtually we get together several times a year in person. And we we share stories. We share successes, mostly what’s working, who who which of the vendors actually can perform to their promise. Right. At the end of the day, this is about making sure that the consumer is is getting better access to health care, that they are able to identify where the best care is. We want to be. We understand that we need to be extremely proactive about that. It’s not about just giving people a website and saying, here, go here and look for yourself. You know, the consumer needs assistance. It’s been 25 to 30 years of grooming and dummying down a consumer where we just simply know, even myself, as as a health care user, we act differently. We accept that there’s no information. We don’t do that in any other aspect of our lives. So these organizations help really speed up that the ability for us to help our clients and prospects achieve better results.

Lee Kantor: [00:06:15] Now, you mentioned that in the last few years there’s been a noticeable shift. And can you talk about like the difference between today and five, ten years ago?

Louis Bernardi: [00:06:28] You know, unfortunately for a lot of people, it’s not much different. But for those people who are. Aware that these conversations are happening. You’re not going to get these from the status quo. There are so many misaligned incentives in health insurance and health care that the people that most trust to help them make these decisions, they’re not digging deep. They’re not finding alternative solutions because their compensation goes down. And that’s that’s a big part of what we do. And what we’re committed to in these different organizations is complete transparency, including compensation. But, you know, there definitely are significant signs that change is happening throughout the country. If you. I’m also a Forbes Business Council contributor. And when I talk to those people who follow the money, they can see behind the scenes that where investment, private equity money is going. And all of the signs show that there is a real huge shift happening behind the scenes in health care and whether the consumer is ready for it or not, it’s going to happen. I think more importantly, five years from now, the choices, the plans, the the type of services and expectations of the consumer are going to be very, very different.

Lee Kantor: [00:07:48] Now there’s a quote by Jeff Bezos that says, Your margin is my business or something along the lines of that. Is it happening because of technology and just the more and more transparency that if there’s a lot of margin or there’s a lot of what technology might deem as waste or ways, that margin, I think, is the fairest word, that there’s ways to squeeze some of that out. With the advent of technology and sharing data and and ultimately for the consumer, I would hope get better outcomes in less time.

Louis Bernardi: [00:08:30] Technology. Really? Yeah. Technology is absolutely at the forefront of all of this. One of the know people argue all the time about the Affordable Care Act, but one of the real good things about the Affordable Care Act was the mandate of and the release of information on all claims, both from private and public companies. So we can see using that data and technology companies are the only one ones that can take those billions of claims and make sense of them and and help point people in the right direction. But what they really exposed and because of the transparency legislation that’s already started, it’s not about margins. It is absolutely unfathomable what insurers and the health care system and particularly on the pharmacy side, what they’ve gotten away with is hidden profits. I, I tell people all the time, I kind of kind of explain it as if it’s an English muffin on the outside. It’s nice and flat. It’s got some cornmeal on it. You know, it looks like one thing when you cut it open. All of those nooks and crannies are where hidden profits, unreported income for the health care system, for the insurance carriers, for the pharmacy benefit managers, their way of doing business is really disgusting when you think about how the toll it’s taken on businesses and their employees and it’s not stopping the data now will become more publicly available. And I think that the health insurance and the health care system, there’s signs that they’re starting to turn on each other because they know someone’s going to take the fall for what these prices will expose. And they’re actually trying to become one another. Insurance carriers are getting into the health care business by acquiring different entities, and health and health care industry is getting into the insurance business. You know, they they know that these hidden profit centers are going to start drying up. And their goal, obviously, is not to lose that income. They need to replace it with other forms of income. And so they’re kind of cannibalizing each other.

Lee Kantor: [00:10:38] Now, I’ve heard some stories when they start kind of making it visible, some of the pricing that like one procedure at a hospital could be hundreds of dollars. And then in the same state down the road, it could be tens of thousands of dollars. Or like you’re saying, with the pharmaceuticals, the cost could be pennies and then the charge could be thousands of dollars. It’s so disparate. Now, the the people who are charging a lot, especially the pharmaceutical companies, saying, look, we have to charge a lot for the winners because we have so many drugs that don’t work out. And part of the R&D, we’re investing millions and millions of dollars. So we have to have some wins in order to incent us to keep playing the game. Like, what do you say to to that?

Louis Bernardi: [00:11:31] Well, there’s no question that it costs a tremendous amount of money to take a medication to market and that there’s many that they invest billions of dollars probably into that never go to market. And we have to give them that right. We want to advance medicine. There’s there’s no doubt about that. But the the other ways that they are manipulating the price is that they’re manipulating the formulary drug lists to maximize profits, something called rebates where pharmaceutical manufacturers will pay a rebate, a significant we’re talking in some cases, tens of thousands of dollars per month. That goes back to the pharmacy benefit manager, which are owned or or are owned by insurance carriers. They’re basically the middlemen of pharmacy benefit managers, really. The the the the broker for medications. They’re getting significant rebates. They’re keeping part of it. They’re passing, let’s say, 70% of that rebate back on to the insurance carrier. That’s unrepeatable income. So common medications like HUMIRA and STELARA, they’re twice what they need to be. And there’s no there’s no reason for that. Right. If insurance companies in the health care system really were trying to do what their main page of their website is, work in the best interest of their patients and their members. That wouldn’t be necessary. You can make a really good living being an insurance carrier or the health care system and still do it in an honest way, in a transparent way and win business because you’re working on the best interest of your members and patients.

Lee Kantor: [00:13:12] Now, do you think that also some of these challenges we’re having in health care are that there’s a lot of regulation around things like, you know, the amount of hospitals in the state that’s very regulated. They tell you how many they can have and how many they should have or the ability. To get drugs over in other countries and then come here. I mean, there’s a whole industry now of people traveling to other countries to get medical procedures done because it’s so much less expensive than other countries.

Louis Bernardi: [00:13:42] Mm hmm. Well, medical tourism definitely is big business, especially for really large employers that self insure and have a little bit more flexibility and say where. Where they’re because they’re paying the claim and you know there’s no there’s no question that things can cost more money here in the US because of regulations. But. There’s there’s. I’ll give you an example, because we have access and some insights that most people don’t. The whole health care system has evolved so significantly. It used to be independent doctors, independent hospitals, because they needed leverage over the health insurance companies who were kind of nickel and diming them with their fee for service rates. They needed leverage, so they merged initially horizontally. Hospitals merged with hospitals and then they merged vertically. They had to take over other parts of health care all the way down to the gatekeepers. And now they use those primary care doctors, those those poor primary care doctors who are who are really suffering just as much as employers and members. And there’s a significant shortage because there’s such little money in primary care and they pay such a they are such an essential part of health care that’s missing today. But they use them to drive people to where they can maximize their profits. So at a hospital, something like an MRI that costs about $200, their self reported cost, they will charge five, six, $7,000 for and only because that number is completely artificial. Your typical insurance carrier gets, let’s just assume a 50% discount and they want 3000.

Louis Bernardi: [00:15:22] So you have to charge six to get three for a $200 procedure. And as you mentioned before, right next door, there might be an independent facility that would perform that same mry for six, seven, 800. And if you’re paying cash, it could be as low as three or $400. The truth is the cash price can be significantly less if you call an advance and say, hey, I don’t want to use my insurance or I don’t have insurance, but if you just show up and you go to that hospital where you’re typically going to be driven or steered towards, they’re not going to feel bad sending you a bill for $7,000, whether you have insurance or not. And that’s that’s just wrong. The consumer needs to know, especially for things like radiology, where they can get the most bang for their buck. The the health insurance plans that so many people are walking around with today are not the five or $10 co-pay variety that they had 20 years ago. You have families walking around with $14,000 deductibles that are still paying a pretty significant amount out of payroll to have the privilege of having the responsibility of paying their first 14,000 of their family’s health care expenses. That’s that’s just not acceptable to me and so many other advisors in the country. And we really want to make a stand and do something about that.

Lee Kantor: [00:16:46] So what can people do to help?

Louis Bernardi: [00:16:52] People, employers, patients. They have to demand more. They have to. They have to challenge those that they trust to help them make these decisions. The focus has to be taken off of insurance. The problem is that the consumer has been groomed to think there’s nothing they can do about it, that the claims are the claims, and that what they’re doing is they’re buying insurance. You’re not buying insurance. You’re buying access to health care for your employees. That’s the investment you’re making. And when you stop thinking about the insurance and you start thinking, am I getting the right health care? And you have that conversation with your trusted advisors, you’re going to find out really quickly if that person even knows what you’re talking about. When you go shopping for a house, you’re not buying a mortgage. You’re using a mortgage to finance the purchase of that house. When you’re buying health care for your employees, you’re financing it with the insurance. And that’s the way the mindset of the employer has to change to. And if you’re a patient, you have to ask first. You have to be your advocate. You have to understand that the health care system is built right now under the managed care fee for service model to maximize profits. That’s not to say doctors are bad people, but they’re they’re great people. They don’t they only get about $0.26 of every dollar of what’s spent on health care. And that’s that’s just not acceptable.

Lee Kantor: [00:18:14] Yeah, this is I mean, we’ve created so much complexity in the system and and unintended consequences of actions over the years. It’s just a really difficult challenge to navigate today with almost, you know, almost having to blow it all up and start again from scratch.

Louis Bernardi: [00:18:36] Yeah. You know, the truth is, is that if you have the proper plan design that’s built with incentives and this is this is not something every employer can do depending on your state, you can’t self insure, but you don’t have to self insure to still think of yourself as a consumer and use technology and apps and and build a plan that rewards people for making the right decisions. There’s there’s tons of companies and we work with several of them where your typical high deductible health plan that an employer might fund with an IRA type of mechanism. Right. Because they’re want to pay less insurance and they’re willing to make a bet that their employees health care costs that they would have to fund is less than that premium savings. So they’ll be a net plus. You can wrap something around that and give your employees a tool and incentivize them in a positive way to use that resource that is going to point them not to where the care is the cheapest, to where the quality is the best. And the hidden secret within health care is that the best care costs less. It really does. You just have to be willing to have that conversation and start thinking about yourself as a consumer and challenge challenge the whole system. That’s that’s what will change when the consumer takes their business elsewhere. Those people that hold the reins have no choice but to change with it. And that’s that’s that’s imperative.

Lee Kantor: [00:20:00] So how if you look into your crystal ball, how far away are we from having a health care system that works more efficiently and effectively?

Louis Bernardi: [00:20:11] I mean, it’s already happening, but, you know, just not quite for for quite enough people as possible. I believe that the managed care networks and the carriers that, you know, today, we call them the Bukas, the large five insurance companies, they will be operating very differently within the next five years. I think that it’s possible that networks will disappear again and that insurance carriers will go back to being the payers of health care, the processors and the administrators, just like what a TPA is to a self-insured employer. Because the because the value that insurance carriers are providing today just isn’t there. And they’ll be challenged by the consumer who’s going to want to see that transparency. And there their pyramids of wealth that they’ve built are going to start crumbling on that.

Lee Kantor: [00:21:04] Well, it’ll be thanks to folks like you who are kind of looking out for the greater good and being part of organizations and associations that kind of have their eye on a true north that’s helpful to more and more people.

Louis Bernardi: [00:21:20] Absolutely. Thank you.

Lee Kantor: [00:21:22] And if somebody wants to learn more about Bright Path, what’s the website?

Louis Bernardi: [00:21:26] So a website is w w w bright path. That’s b r i t e p a t h.

Lee Kantor: [00:21:36] All right, Lou, thank you so much for sharing your story. You’re doing important work and we appreciate you.

Louis Bernardi: [00:21:40] Thank you. Have a great day.

Lee Kantor: [00:21:41] All right. This is Lee Kantor. We’ll be back next week with another episode of Association Leadership Radio.