I reached out to Andrew Tsang after seeing his charts on LinkedIn. He maps where the money flows in American healthcare, and every one makes me realize how little of it I understand. Andrew spent about 15 years consulting across providers, payers and pharma, plus work in Medicaid policy. He recently left that career to write about healthcare economics. The question on the table: who decides what care is worth?
Who Decides What Healthcare Is Worth?
Andrew Tsang maps where the money goes in American healthcare. We talked revenue cycle, why a claim is an argument, and what his charts say about our values.
Watch The Episode
Who Decides What Healthcare Is Worth? with Andrew Tsang, LOF #138 of Life of Flow, hosted by Dr. Lucas Ferrer and Dr. Miguel Montero-Baker.
The Most Consequential Boring Thing
Andrew calls revenue cycle management the most consequential part of healthcare. It's where care meets commerce. Before a visit come eligibility checks and prior authorizations. After it come coding, claims, denials, appeals, and finally write-offs or collections.
His guess is that patients probably spend more time on revenue cycle work than receiving care from clinicians. For a practice, a missing insurance card or a mistyped number means waiting longer to get paid.
Scale Wins The Paperwork
I argued for entrepreneurship. When my family went looking for a pediatrician, we chose a direct-to-consumer practice outside insurance. Two smart doctors built a model that fits the people they serve. I think problems get solved through iteration and doing, and that needs physicians who are free to try things.
Andrew agreed with the spirit. Then he named the catch: the playing field isn't level. He's had health system clients with whole floors of an office park dedicated to medical coders. An independent practice would have to hire just to keep up, while reimbursement keeps declining.
A Claim Is An Argument
Could AI agents replace the call centers? Andrew called that hype.
He pointed at the word itself. A claim is an assertion, and the other side gets to contest it. AI may make the exchange faster. The disputes keep happening. By his estimate, about $217 billion goes to fights between hospitals and insurers.
What The Charts Say
Andrew's diagrams compare systems by their values. The UK's Beveridge model treats care as a right, decided after World War II. Germany's Bismarck model has workers and employers pay into a shared pool. In his view, America never answered the question, and our system grew through a series of accidents.
His US chart shows working people paying three times: through taxes, through their paychecks, and out of pocket. Every line is a nursing home, a NICU visit, a parent calling six numbers to find one in-network specialist.
The Takeaway
Miguel offered him a magic wand. Andrew pushed back on the idea.
He thinks change comes from education, and from people seeing healthcare as us against the problem. Faster software won't decide what care is worth. People will.