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Where we share our weekly news debriefs and discussions with industry experts. These are lo-fi recordings aimed at giving our readers more opportunities to engage with our analysis and a view into some of the conversations that shape it.
Kevin: I read a blog post from Neil Shaw
who's joining us here, who started talking
about this great unbundling of maternity
care and the transformation that's
happening from a payment rate perspective.
Kind of going from value-based
care bundle payment concept to more
old school fee for service type
mindset in the maternity space.
Neil, really excited to have you on today.
Uh, excited to learn more about what's
happening in maternity space and wanted
to see if you'd just start us off with.
Historically, what's up with this
bundle payment and maternity care?
What, what drove this change today and
what should folks looking at the space
expect to happen over the next kind of
coming 12 months, 24 months and beyond?
Neel: First of all, I need to hang
out with you guys more because,
uh, anybody who's like, there was
a paper once on price transparency.
He's like good friends with me.
But, um, yeah, so historically, uh, now
we're talking like for a full generation,
going back like 40 years to the eighties,
uh, the way maternity care was paid for
the United States was this one big bundle.
And, you know, healthcare is complicated.
We've had this idea of bundles,
uh, for a while, but particularly
following the Affordable Care Act as
a way of paying for value, whether
it's a joint replacement or even some
kinds of cancer, uh, um, services.
And then the notion is if you,
you pay for a whole episode of
care, you're less likely to get
the fee for service incentives of.
You know, getting paid to
utilize more than you need to.
And pregnancy and maternity care is
like one of the most bundle able things.
It's got, you know, a starting
point, an end point, um, you know, a
pretty predictable set of services.
Uh, and for a long time that
bundle seemed to serve its purpose.
Um, and we can get into it, but, um,
I also kind of saw this innocuous
email from the American College of
OB GYN, uh, a few months ago, saying
that the bundle was gonna end.
Um, and it seems like this really
wonky technical change, but it will
actually change the way maternity
services are not only paid for, but
delivered, uh, for the next generation
of people, pretty substantially.
Martin: Can you give us a peek into
the future of like, what this is
gonna look like practically if you are
having a baby or happen to be a clinic
that does maternity care like Maven?
Neel: Sure.
I mean, maybe let's start with like
the why, like why are they changing?
I mean it, the, this was one of the,
again, one of the fears of healthcare
where, um, where there, where you are
a purchaser or just a person having
a baby and trying to start a family,
there's a very predictable way of
paying for care for the most part.
Um, but the bundle was starting to get
stressed by the fact that in 2026, the
doctor you see in the office is rarely the
doctor that delivers your baby anymore.
That used to be most of the
time, and now it's like pretty
rare for that to be the case.
And so that creates complexity around who
should get paid what within that bundle.
Um, so team-based care change things.
And also, uh, technology has changed
radically in the last 40 years.
You still can't deliver
a baby through a screen.
There are some limits, uh, when it comes
to maternity care, but, you know, the
first ultrasounds used in pregnancy
was when I was born, uh, and I'm 44.
Um, the first IVF baby in
the US is the same age as me.
So, you know, and, and that doesn't
say anything about, you know, genetic
screening and a, a lot of the more
advanced therapies that we have today.
And so the bundle didn't do a
great job of accounting for that.
Uh, and so a lot of people said that
it was stifling, uh, innovation.
Um, nobody knows exactly what's gonna
happen when we fully unbundle, but the
decision was made, um, that we're just
gonna pay for things piecemeal now.
Um, and, uh, in the process of
reporting on this, I talked to, um,
the, the CPT committee at the A MA.
Uh, I talked to payers, I talked
to clinicians on the ground.
Um, and one, it's, it's
designed to be budget neutral.
So the a MA does this and they
go to CMS and they tell them
it's a budget neutral change.
But that means that, uh, you're
gonna pay more in some places
and less in other places.
And that's where the rub comes.
So if you're, you know,
you take care of high risk
pregnancies, you'll get paid more.
If you have a high risk pregnancy, you'll
pay more or somebody will pay more.
Um, and probably what'll happen is if
you have a low risk, straightforward
pregnancy, um, the payments will go down.
Uh, and that has implications also.
Kevin: Neil, when you say the payments
will go down, this is the question I was
gonna ask you kind of, you know, squeezing
the balloon concepts, I hear the theory,
a lot of somebody's gonna get paid less.
And one of my lessons learned getting
into healthcare innovation over
the last decade is that doesn't
seem to materialize all that often.
How, how are costs gonna go down?
Is it, is it rates go down for
the low cost for the, the lower
risk pregnancies, or what's Yeah.
What's driving that shift?
Neel: I mean, so I'm told that,
uh, we're full steam ahead.
This is happening on January 1st, 2027.
There are a lot of, um, open questions
around implementation and there's
a lot of additional guidance that I
think we're meant to be getting around
modifiers and things like that, Kevin.
Yeah.
Um, but you know, like part of
my role at maintenance to guide
purchasers and what they should expect.
Um, and uh, part of what we're aiming
to do also is plug access gaps.
Um, and one of the people I interviewed
along the way, um, is Ris Bakari,
who by the way, you should have on,
'cause he's imminently quotable.
Um, but you know, he's got a company
called Claimable and he's really on
the front lines of American frustration
with the American billing system.
Uh, and one of his better quotes
that he gave me is, uh, he called
unbundling the original sin.
And he was like, you know what happened
when they unbundled your cable?
Did prices go down to your point, Kevin?
No.
No, they did not.
Now I pay for five streaming services
where he was like, remember the quaint old
days when you just paid for airfare and
also covered your meal and your baggage?
It's like, how does it work now?
So, I mean, I think, um, ultimately
for a lot of, uh, purchasers and a
lot of people, prices will go up.
My my worry though is that, um,
particularly in rural America or you
know, independent practices that we're
already serving people with really
marginal, uh, or really thin margins,
um, the incentive to take care of
lower risk people might go down, right?
And so they may shift to make more money,
but the fundamental, uh, truth is that
if you are a straightforward person,
um, your pregnancy will cost less.
Martin: I am curious about your
view on how, so I, I hear the
argument that he's making about
unbundling being the original sin.
You know, the, the sort of rejoinder
to that is like a lot more people
fly today than could fly when
everything was bundled together.
Um, the question I have coming from
the kidney care space is bun, like the,
the bun kidney, the bundled payment
for kidney has done a incredible job
of keeping dialysis payments low.
But it's also, I think,
stifled a lot of innovation.
And I'm curious what you are
seeing as like, what are.
Folks in the market missing out on because
it just doesn't fit into the bundle.
Neel: What a time to be alive, Martin.
I mean, like right now we live in a moment
where, uh, you know, preeclampsia has
been a scourge for humanity since forever.
Uh, like it's an ancient Egyptian text
as this thing that kills pregnant people.
And even today it's one of the really,
really, yeah, we have, we have, we
have, uh, tens of thousands of years
of, of history, basically since there's
written language, we're describing
this mysterious disease of pregnancy.
And until, basically today
we had no idea what it was.
But now we can, uh, use free
floating mRNA that's in the maternal
bloodstream, uh, from the fetus and
identify someone who's gonna get
severe preeclampsia months before
they do with no apparent risk factors.
Um.
Okay.
That's one of like a million examples
I can give you, uh, or a ring, uh, you
know, is really good at sensing thermal
shifts, which happen right around the
time of ovulation, but also it happens
right before people go into labor.
Uh, and when I was on call, uh, in the
hospital, the only way I knew if I was
gonna be busy is if there was a full moon.
But now we live in a world where
maybe we can predict labor onset,
something that I thought was
impossible for my entire career, right?
So there are all of these emerging
technologies that have not translated
into routine practice because we
haven't had a construct to pay for it.
And I think it's a totally reasonable
argument, um, that the old bundle,
uh, was stifling innovation in a way.
The question is whether we should
have thrown the baby out with the bath
water and whether there's a better
bundle, um, at least as a concept.
Um.
But, uh, it's, it's a, it's
a totally fair question.
I think that, um, you know, the
expectation is that, uh, certain
types of innovation will be easier
to bring to market this way.
Kevin: Neil, one of the things I think
I read in the article was that, um,
it was kind of this point of bundle
of stifling innovation and that
removing this bundle will actually
allow for more innovative payment
constructs to come to fruition as well.
Uh, I'd be curious if you could, uh,
expand on that statement a little
bit, and also what you're seeing.
What are the implications for the
employer market more broadly speaking
for a company like Maven working with
employers to manage maternity costs,
like I would, I would think that's
where some of the opportunity now lies
to rethink what a bundle is there.
How are you guys processing this and
thinking about the opportunity in, in
new forms of alternative payment models.
Neel: Well, I mean, I think the one
thing that we're certain of is that
there'll be more uncertainty, right?
And basically, like the nerdy way
of talking about it is volatility.
Kevin: Yep.
Neel: Um, right.
And, and wherever you see volatility,
there's an opportunity to think
creatively about risk and risk management.
So it's possible that there could be
a world where you see, uh, you know,
willingness to take on risk in different
ways now that there's more volatility.
Um, there are some purchasers that we
serve at Maven that have a baby every
12 minutes somewhere in the world.
Um, and, uh, you know, a lot of them skew
towards higher risk, and we are projecting
that they're gonna see higher total costs
of care as a result of the unbundling.
And so it argues for.
Stronger and more
effective care management.
Um, one of the things that I'm excited
about with the unbundling is that we'll
have much more granular information about
the services that are being provided.
'cause people are gonna be
billing at the service level.
Um, and you can't fix what you can't see.
Um, and so we'll have much
better visibility into services.
And so theoretically, I think like you and
Martin were talking about this, uh, right
when I came on, but like, you know, price
transparency by itself isn't good enough.
Kevin: Mm-hmm.
Neel: I think Abraham Verghese once
said, if you're o ordering off a menu
that has no prices on it, it's really
easy to get the filet mignon every time.
You know?
And so like conceptually,
price transparency should
help, but you need some kind of
accountability mechanism with it.
Right.
And I think those are where a
lot of the open questions are is
like, okay, we'll be able to see
which services people are getting.
We'll probably have a point of view on
whether they're the right services or not.
But then what is the accountability
mechanism to sort of make sure
that we're course correcting?
Martin: I'm, you know, an, an
absolute tourist in this area.
I have a 10 month old.
But aside from that, no real sort of on
the ground, uh, uh, research expertise.
I used to work for Medicaid though,
and one of the things that I find
amazing is, you know, Colorado
Medicaid, they have this doula program
and the results are like incredible.
It seems to me like doulas are one of
those things that are maybe like under
reimbursed today and in a new model we
can that, you know, that, that, that
sort of takes it out of the bundle.
Are there anything that you are
sort of excited to see in terms
of technology or process or care
management that you think is gonna be.
Better compensated going
in in this new paradigm.
Neel: Uh, first of all, I love that lead
up because I mean, having a 10 month
old gives you plenty of street cred.
'cause I, I delivered thousands of babies
before I had to take one home, you know?
And I feel like that really
changed my perspective, uh,
but then casually dropping that
you also worked for Medicaid.
But, but I mean, listen, uh, I think
that doulas are an example of the
only public health intervention that
consistently works for everything, which
is the community health worker, right?
Whether it's directly observed therapy
for tuberculosis in Haiti, or like
cholera treatment or, you know,
like community health workers work.
And there's a ton of evidence.
And I think that there's also a lot
of momentum for state Medicaid systems
to reimburse, uh, for doula services.
Um, I think 26 states now and
growing and that is great.
And also, you know, Medicaid
works from a scarcity.
Mindset and reality.
Uh, and so doula reimbursements,
crowd out other services.
And fundamentally the challenge is
that, you know, childbirth is one of
the highest value services I would
argue that our health system provides.
Um, but we don't pay for
it the way we value it.
We pay much more for, um, end of life care
in the ICU or, you know, other things.
And, and it's hard to, you know,
like all of our health services are
valuable, but relative to the way I
think society ought to value childbirth,
um, we probably, um, don't do a good
job of paying for all the services that
people would benefit from, including
doulas, but including everything else.
Martin: I appreciate the
dots and partners in health.
Shout out.
Uh,
Neel: yeah.
Well, it's a nerdy, it's a nerdy
podcast, so I figured I'd go there.
Martin: Yes.
Kevin: Neil, I'm curious on the
awareness front, uh, how you see this
playing out over the coming months.
I, you know, as health tech nerds,
I like to think that we keep our
eye on stuff that's happening.
Certainly, it's, I'm so proud of
Neel: myself scooping you.
Kevin: Yes.
We appreciate that.
Yeah.
That is how we learn
in the Slack community.
Um.
It strikes me that I, I, I imagine
most employers aren't aware of this
change or haven't fully processed it.
Brokers are still in a processing
phase of the change at hand.
I was reading an article this week
talking about what employers are
thinking about in terms of managing costs
and its alternative plan designs and
transparency and, uh, primary care models.
How, how big of a deal is this gonna be
for employers, for the large employers
who are having a birth every 12 minutes?
Um, are they gonna, would you expect
that come 2027, this is gonna be
rising up the list of, Hey, we need
to think more about maternity now
that this change is coming to play?
Or what's gonna be the impact
among employers and how should
brokers be thinking about that too?
Neel: This is gonna be a slow burn story.
Yeah.
So the story is not over,
like, this is like ground zero.
We're pointing out that this is happening.
Um, I think, uh, more smart
people like yourselves are
gonna start paying attention and
weighing in as we learn more.
And then, you know, uh,
CMS is gonna spend years.
Studying what happens, uh,
and theoretically making
adjustments accordingly.
But I will tell you, um, in, uh,
effectively breaking the story open, um, I
have never seen more interest in anything
that, uh, we I've ever tried to talk
about, um, from the purchaser community.
'cause this wasn't on a
lot of people's radars.
Even, uh, you know, the health plans
have to update all their systems.
Yeah.
Um, there are practices on the
ground that, uh, are just beginning
to contemplate what this means.
And some are projecting significant
revenue shortfalls as a result, and
others are counting on being winners.
Um, so there's, there's
a lot I think that, um.
We're likely to learn, but I think
it's possible that, uh, some purchasers
of healthcare whose population
skew towards being higher risk will
see cost increases of up to 10%.
And it's not just the folks who
have a baby every 12 months.
If you were to take the entire GDP
of the United States and spread
it out across a table, you could
see the cost of hospitalizing moms
and babies with your naked eye.
It's 0.6%
of our whole GDP.
It's the most utilized healthcare.
It's 25% of all hospitalizations
are a mom or a baby.
Um, so if you're a Medicaid system
in Colorado, or if you are, you know,
um, a commercial purchaser or a union,
everybody's gonna see and feel this.
Martin: Yeah.
Neil, we're at time and
unfortunately can't keep you longer.
We didn't get a chance to talk about
Mavens expansion into fertility, so we'll
have to have you back or expansion of the
fertility and family building programs.
Excuse me.
For folks who haven't read it yet, if
you go to maven preprint.substack.com,
you can read The Great Unbundling by Neil,
which is what prompted this conversation.
It is very fascinating.
Neil, where can folks learn more
about Maven and get in touch with
you if they, if they want to?
Neel: I think Substack is a great spot.
Um, I think, uh, you know, it's
a, it's this wonderful medium
where people like to read.
Um, and so you can write a 5,000 word
long form article about the great
unbundling and have people pay attention.
Martin: And we are, uh, we really
appreciate your time today.
Thanks so much, and like I said,
we're all, we're already looking
forward to having you back.
Neel: You bet.
Thanks Destiny, Danielle.