83 – DEA vs Telehealth | Will Regulations End Prescription Abuse or Hurt Patients?

[00:00:00] Marcus: If you enjoy this content, please take a moment to rate and review it. Your feedback will greatly impact our ability to reach more people. Thank you. Happy birthday, man.

[00:00:08] Vic: Thank you. When you get to be as old as I am, you know, it’s just, um, it’s a celebration, but not, not the same as when you’re 21 or 25 or whatever, you know, younger.

[00:00:18] Marcus: Yeah. But it’s, it’s, it’s always worth celebrating. Yeah. Another year.

[00:00:22] Vic: Yeah. I got, I got myself a gift, this, this Garmin watch to track my workouts and things. Oh, nice. And so I’m choosing to look at, uh, my fitness age as, you know, that, that’s 50. Wow, your

[00:00:36] Marcus: fitness age is four years? Four years younger than my real age.

[00:00:39] Marcus: That’s fantastic.

[00:00:41] Vic: I don’t have any frame of reference.

[00:00:43] Marcus: That’s really good. Okay, good. That’s really good. That’s hard to do. Yeah, I

[00:00:48] Vic: don’t

[00:00:49] Marcus: know.

[00:00:49] Vic: And so it tells me also what I need to work on. Yeah, my BMI is too high and I can cut it more, but still below my, my, my actual shit. Yeah.

[00:00:59] Marcus: BMI is [00:01:00] ridiculous. If you’re,

[00:01:01] Vic: if you’re like, if you’re stocky and, and have muscle, it’s body comp, body

[00:01:05] Marcus: comp is what matters.

[00:01:06] Marcus: I was just, I was chatting with a friend of mine who, uh, ours, uh, just not going to say who it is, uh, but, but a friend of ours who has recently made some really good health, uh, Shifts and they had, um, they, they were sort of down because the scale wasn’t moving. And then I went into the doctor and they lost six and a half percent.

[00:01:26] Marcus: Percent six, six and a half pounds of body fat and picked up six and a half pounds of lean mass.

[00:01:32] Vic: I’m like, yeah, so you’re scaled and changed, but your, your composition,

[00:01:36] Marcus: stop looking at the scale. The scale doesn’t matter. Like how’s the mirror look, right? How do you feel? You know,

[00:01:41] Vic: I’m training for half marathon with to do with my son just for fun.

[00:01:45] Vic: Well, that’s part of why you’re gained weight in that process. Yeah. So yeah, muscle, muscle, your

[00:01:49] Marcus: body has to like put on muscle and also probably with the impact you’re probably putting on bone density too. Yeah.

[00:01:54] Vic: Yeah, both of which I need. Yeah, those are, that’s great.

[00:01:57] Marcus: Right,

[00:01:57] Vic: right.

[00:01:58] Marcus: That’s awesome, man. So.

[00:01:59] Marcus: That’s awesome. [00:02:00]

[00:02:00] Vic: So tell me about Vegas.

[00:02:01] Marcus: Yeah, so, uh, I, I went to Worlds and I lost. Yeah. I lost and I lost. It’s hard to

[00:02:06] Vic: three

[00:02:07] Marcus: peat. Yeah, you know, so, man, it’s, it’s, uh, I’ve really refrained from talking too much about it because, um, you don’t want to come off Like you’re making excuses, right? You don’t like you don’t want to do and I’m not making excuses like all credit to the guy who beat me, right?

[00:02:27] Marcus: I mean, yeah, first of all, this is my first time at purple belt the guy who beat me This was third time the purple belt. Yeah, he’d already won at purple belt. Yeah, he’s podiumed every year He’s done in the purple. So like yeah, you know like a fair play I went against a great guy and I lost and that’s kind of what happens.

[00:02:44] Marcus: I

[00:02:44] Vic: mean, that’s that’s a great thing about athletics It’s it’s it’s it’s You never know what’s gonna happen.

[00:02:48] Marcus: No, yeah, exactly. So it was, it was a really, um, I don’t like to lose. So like, you know, I didn’t have fun with it. But, [00:03:00] but, um, two things. One, Before I flew out for Worlds, I texted a group of people who I felt were really instrumental in, um, helping me get there over the course of the last year, you know, because when I finished up Worlds last year, I mean, I came out of that.

[00:03:20] Marcus: My body was an absolute wreck. My knee, I didn’t realize a month after Worlds last year, my knee was going to explode with bursitis. Which then cost me six months of training time. I mean, I still lifted weights and stuff. I did not do Jiu Jitsu from October to March. That’s six months.

[00:03:39] Vic: Then you got it.

[00:03:40] Marcus: I came back in April.

[00:03:42] Marcus: I competed at a local tournament after two weeks, I won. And then in may, I got my purple belt. Then I competed in two more tournaments. I won those. So I was 8 0, you know, on the year, 6 0 at purple belt. And then I went into worlds, and I just, I ran, you know, I ran in. I was low [00:04:00] seeded. I ran into the number 2 seed.

[00:04:02] Marcus: I lost 5 1, 5 0. And, and, you know, so. I reached out to those people to tell them, like, how much I appreciated the role they played in helping me even get there. Yeah, before

[00:04:14] Vic: you had competed, so just like, thanks for helping me get to, get to go compete. Vic,

[00:04:18] Marcus: in February, like, my knee is a disaster and my dad’s going through the stroke.

[00:04:22] Marcus: It’s like, dude, I was not, I did not think I was going to Worlds. Yeah. Okay, I did not think I was going to Worlds. And then the second thing is, um, it’s actually really. Great. When you go up against somebody who is great and you lose and you have immediate clarity on what you need to do. Yeah. Right. You know what I mean?

[00:04:45] Marcus: Like I came out of that and I was like, okay, I have three things I need to change. I’m not going to say them. Yeah. Right. Right. Because they’re not

[00:04:51] Vic: working against you.

[00:04:52] Marcus: But there are three things I need to change and I’m healthy. So I’m working on them this week. Yeah. You know what I mean? And. [00:05:00] That’s actually really exciting.

[00:05:02] Marcus: It’s really exciting for me right now to be in this process where I’m healthy I have clarity on what the next level looks like it’s something to work towards Yeah, it’s growth.

[00:05:13] Vic: I mean, it’s growth. It’s striving. You’re getting

[00:05:16] Marcus: you’re getting better And Vic, I’m gonna be such a menace after this, like it’s, it’s gonna, like, I’m going to be a real, real problem, a real problem.

[00:05:24] Marcus: So, anyway, I’m pretty happy. I’m pretty happy. Uh, and, the guy who won, I beat, who won the division, was not the guy who beat me. The guy who won the division. I beat him two weeks ago.

[00:05:37] Vic: Yeah, yeah, so it’s just a scene in kind of like how the competition goes. Yeah, I’m in the mix. I’m

[00:05:42] Marcus: in the mix at this level, you know, but I got some stuff to fix.

[00:05:46] Marcus: Yeah, I got some stuff to fix. So, so that’s how Worlds went. Thank you for asking. Um, And, uh, we just get back in training. We keep working. Yeah.

[00:05:53] Vic: Well, Doug and I had a good show without you. We missed you, but he did a good job. I thought

[00:05:56] Marcus: Doug did a great job. Yeah, I was so I [00:06:00] listened to the show on the, uh, on the way back from Vegas.

[00:06:03] Marcus: And I was like, I’m so impressed with how well he did. Yeah. So props, Doug. I told you this personally, but I want to put it on record. Yeah. You did a great job. I mean, you made me feel like I have to fight for my spot here. Uh, you know, with Vic on the show, but great job. I don’t think either

[00:06:16] Vic: Doug or I want to fight you.

[00:06:17] Marcus: Uh, all right, man. We’ll look enough. Enough talking. Let’s uh, let’s dig in.

[00:06:33] Marcus: All right. So it is getting. Very, very close to the September 17, 18 Fed. The Fed.

[00:06:42] Vic: Everyone’s looking towards the Fed to cut rates and help the economy. Yes. I’m not sure how much magic pixie dust they have, but that’s what everyone’s looking towards. It’s going

[00:06:53] Marcus: to make

[00:06:54] Vic: people

[00:06:54] Marcus: feel good. Yes. Yes. That’s for sure.

[00:06:56] Marcus: It’s

[00:06:56] Vic: definitely going to be a emotional

[00:06:59] Marcus: kind of boost. There’s going [00:07:00] to be an emotional boost. You think about the realtors, you think about mortgages, like it’s going to move things. It won’t be nothing. Right, right. It’s going to move things.

[00:07:08] Vic: And so, uh, tomorrow, the Bureau of Labor Statistics will put out the jobs report.

[00:07:14] Vic: Yes. By the time you listen to this, yeah, it’ll be out. That’ll be out. We don’t know what it is yet, but the New York Times had a story, I think yesterday, about how important, uh, this, uh, Jobs report is as a contributor to what the federal do. I think everyone will show the odds later. Everyone thinks there’s going to be a, a cut.

[00:07:32] Vic: The question is, are they going to do 25 points or 50 points? Uh, the next tab is, is it was in this article, but I think it’s easier to go there, uh, for people that are just listening, it’s the unemployment rate. And then they added the underemployment rate, which are people that are. Working part time or they’re sort of no longer looking for a full time job, but but they’re they’d rather have a full time, right?

[00:07:54] Vic: Right, but what I like about this chart is it goes back to 2000 So it goes back a long [00:08:00] way which a lot of charts don’t go back that far and then you have the recessions put in there and the you know, the unemployment rate is Over four now and that seems like really high, but it’s been over four, you know, for a lot of those years, people that are not able to see it.

[00:08:19] Vic: It was at four in 2000 and then it never hit four. It was over four up to 10%. 9, 10 percent during the GFC and then it’s stayed over for, you know, almost to like 2019. And so it is increasing the last little bit, the last few months, it’s gone up, you know, material amount. Um. But it’s, it doesn’t feel like it’s out of control, really.

[00:08:48] Vic: Well, it doesn’t feel like it has gotten out of

[00:08:51] Marcus: control yet, but the rate of change and the change in the curve is going vertical. Oh yes, it’s definitely

[00:08:56] Vic: turned up and going up more quickly every [00:09:00] month.

[00:09:00] Marcus: And it is the Fed’s job to get out in front of that, right? Like to say, oh, rate of change. Steepness of curve, like we need to do something and

[00:09:08] Vic: inflation is the opposite.

[00:09:09] Vic: And that’s the other half. They need to balance. This curve is going the wrong direction. Inflation is going much better. Right direction. That’s right.

[00:09:16] Marcus: That’s right. So, so ADP released their numbers, which is kind of like a preview to what the BLS numbers are going to be when they do the jobs report. And, uh, I think the forecast originally was 140, 000, uh, private payrolls up, and then they revised it down to 111, 000, and companies have only hired 99, 000 workers.

[00:09:42] Marcus: That was, that was the actual number the ADP released. So that’s, uh, it’s not quite half, but it’s like, uh, two thirds of the, of the number, um, that was originally projected. Not good.

[00:09:53] Vic: Not good. And it is, um, I think it’s another sign that tomorrow is likely to be a [00:10:00] weak, uh, unemployment, weak employment, high unemployment number, but we’ll have to see.

[00:10:06] Marcus: So you were talking about the forecasts, um, that are out there. We hear a lot, a lot of people talking about, uh, what the market is betting on in terms of the 25%, the 25 basis cut or, or the 50 basis point cut. This is a great graph for those who are not watching. It’s like an old school Microsoft Windows application.

[00:10:24] Marcus: Right. Uh, and the title on the application window is FedWatch Tool, uh, but it’s basically got these probabilities that the prediction markets are weighing for the 25 basis point cut or the 50 basis point cut. And we’ll, we’ll, we’ll cut out a month ago because that was when the VIX skyrocketed with the Nikkei carry trade issue.

[00:10:43] Marcus: Um, from one week. So August 29th, uh, 34%, uh, probability of getting the 50 per basis. Point cut. Right? 66% probability of getting the 25 basis point cut [00:11:00] you go to a day ago and it was 44%. Yeah. Uh, for the 50 basis point, 56% for the 25. And now. A day later, it’s ticked up a point towards the 50, uh, basis point cut.

[00:11:15] Marcus: So we’re kind of incrementally headed to a place where it could be 50, 50, right? I mean, you know, especially with the ADP numbers and then the job numbers that are going to come out next week. It seems like the market is kind of saying, uh, you probably need to go 50 on this.

[00:11:29] Vic: I think that’s right. It’s

[00:11:30] Marcus: moving in that direction.

[00:11:31] Vic: I’d like to see 50 basis points. Um, I think the market’s predicting that it’s 50 50 what they’re gonna do. Right. I mean, they’re almost certainly gonna do a 25 basis point cut. There’s no, there’s no, there’s no odds. There’s a 100 percent chance. There’s no odds right now with any money behind it that there’s not gonna be a cut.

[00:11:49] Vic: That’s right.

[00:11:49] Marcus: That’s right.

[00:11:49] Vic: There’s a 100 percent

[00:11:50] Marcus: chance there’s a cut. So 25 is the floor.

[00:11:52] Vic: Yeah. So to me, that’s the symbolic, uh, kind of psychological benefit that the Fed has stopped hiking rates [00:12:00] and fighting inflation, and they’ve turned to try to help, which is psychologically great. Yes. And then there’s a lot of people thinking that they’re going to do 50%.

[00:12:09] Vic: Points, but that’s unclear. It’s 50, 50, 45, 55.

[00:12:13] Marcus: I think the point here is that the, the probability is growing for 50 basis points, but there’s the jobs numbers are coming out worse and worse and worse. Right. Yeah. All right. Let’s, uh, let’s move to, to the VC, uh, markets. So two stories thatch takes in 38 million for ICRA health benefits.

[00:12:30] Vic: Yeah, so this is the situation where an employer wants to give money to employees to use for health care, whether it’s through an HSA or another program like that, and I think that is trying to sort of grow that market Segment kind of a combination of health tech and fintech and I think positive it’s giving people actual Spending power if they can go spend on whatever they want for their own health [00:13:00] I like that empowering the the actual patients or the employees.

[00:13:03] Vic: Sure. Sure.

[00:13:04] Marcus: Yeah. I mean, I think that there are definitely Lots of opportunities in this space. I think that employers struggle to kind of maximize employee engagement around these different programs, that that’s always kind of the, the challenge. And so, you know, we’ll, we’ll keep an eye on, on that and kind of see how they differentiate, um, in, in employee engagement.

[00:13:26] Marcus: Cause that’s really the, the, the key, right? Yes. Uh, all right. And then second deal is light forest lands, 50 million for dental devices.

[00:13:34] Vic: Yeah, these are the, uh, like 3D printed things you wear to straighten your teeth as opposed to braces or liners or things. Yeah, they are

[00:13:43] Marcus: liners, they’re

[00:13:44] Vic: just 3D printed.

[00:13:44] Vic: Yeah, exactly, exactly. It’s a big, big round, 50 million dollars. It’s a pretty competitive space. And so I was surprised at the size of the round, uh, given that I think it’s margins are coming down and it’s, it’s a hard [00:14:00] space, but good to see money coming in.

[00:14:02] Marcus: I’m not sure if they’re, they’re kind of on the backend or they actually are going all the way to the retail market, but it just rhymes with model direct club for me.

[00:14:08] Marcus: And I, you know, I just can’t get excited about.

[00:14:13] Vic: Yeah, it’s, it’s a, it’s a very competitive space where there’s low margins. Yeah.

[00:14:20] Marcus: All right. Moving into policy, Biden is preparing to block a 14 billion steel deal. So this is not just any steel deal. This is a U S steel deal as in us deal from Pittsburgh, as in the Pittsburgh Steelers, uh, so us deal, iconic American companies since the beginning of the 20th century, and their shareholders have voted, uh, to.

[00:14:43] Marcus: Take an offer from Nippon Steel, uh, which is a Japanese Japanese company. Yeah. And, uh, Biden is preparing to block the deal

[00:14:53] Vic: and it’s not just Biden. Harris has come out and Trump has come out. No, the Sydney president [00:15:00] and both candidates are against this deal going forward. I don’t, there’s no economic or economic development or job reason.

[00:15:11] Vic: That you would have to block it. We’re friendly with Japan, but it is a bad symbolism. I guess that’s us steel. It’s called us steel. It’s not owned by the federal government. It’s owned by existing shareholders that are not the government. It’s probably a bunch of Japanese shareholders. Now

[00:15:28] Marcus: timing matters.

[00:15:30] Marcus: This is a terrible time to try to get this deal done. Yes. The union is against it. Yeah. We’re in a presidential. I think you just look absolutely anti American selling one of America’s most iconic historic companies to Japan. Uh, a couple months out from the election. I just, I just think, I just think, you know, if this was happening next year, probably no one would care.[00:16:00]

[00:16:00] Marcus: You know what I mean? They’d let the deal go through, but just right before an election, you just can’t have a headline saying you’re backing the sale of USA. Steel to a Japanese steel company. And the union is against it. Like that’s, that’s got a million bad things hanging on it. So, um, and, and, and I know Donald Trump has, has actually strong, very strong relationships with Japan.

[00:16:22] Marcus: So I would imagine it was not easy for him to, you know, come to the position. Obviously, obviously he has the whole America’s first sort of, you know, cornerstone, but he’s got great relationships in Japan. Um, so.

[00:16:33] Vic: And Pennsylvania is a big, uh, battleground state, so I think that’s part, the narrative is really hard.

[00:16:39] Vic: It’s

[00:16:39] Marcus: political. Yeah. It’s political. This is a bad time of year to try to get this deal done. Yeah. Unfortunately for Nippon Steel. Yeah. And for the shareholders of U. S. Steel who voted to accept the deal. Because I think this is probably the best offer that they got.

[00:16:51] Vic: Yeah. I mean, I’m a, I don’t think it makes sense for the government to come in and say, who can, uh, by other companies, but I agree their political [00:17:00] narrative is really hard.

[00:17:01] Vic: And

[00:17:01] Marcus: look, at the end of the day, you’re in America. Like, we do regulate the business environment and deals can be blocked. I mean, we talk about it all the time in terms of hospital deals. So, you know, I don’t see why this is that much different. Well, it’s not, it’s not a security risk.

[00:17:17] Vic: That’s where I think it’s different.

[00:17:18] Vic: Like, they’re claiming it’s, it’s a national security risk. That’s why it should be blocked. That doesn’t make sense to me. I mean, Japan is not likely to not allow us to make ships or whatever the security interest is. I’m in favor of on showing our chip supply. And so that, that was another thing that was done that had a lot of government, um, support.

[00:17:44] Vic: I think you’re right. It’s going to be blocked. It’s just, I’m not sure it actually makes sense. But in an election year,

[00:17:49] Marcus: you know, nothing makes sense. It’s not politically palatable. Yeah. That’s the bottom line. Uh, Continuing on, California Senate passes bill to clamp down on private equity health care deals.

[00:17:58] Marcus: So this has been a long [00:18:00] running narrative about private equity in health care. Lena Kahn’s been after him, Grassley’s after him, Elizabeth Warren is after him. Uh, the outcome of the Stewart Health thing was terrible. The state had to actually put it into receivership and take it over. Uh, and now we’ve got California, which is, generally speaking, pretty out in front, uh, as a state on these types of matters, saying that private equity is no longer allowed to do deals with non profit healthcare entities.

[00:18:25] Vic: Which is Was surprising to me. I mean, not that it is not the natural end to this, uh, trend. Who is going to do deals with non profit health systems? If private equity is not doing it, there’s only like three large non profit systems.

[00:18:45] Marcus: I just want to go back to the part where you said this is surprising.

[00:18:48] Marcus: It’s surprising to you that California did this? It’s surprising that any state would bar it. No, you can’t say that. It’s California. I guess so. Why are they trying

[00:18:56] Vic: to

[00:18:56] Marcus: chase

[00:18:57] Vic: everyone who does anything smart out of this state? [00:19:00] They do all the like super over the top stuff. I mean. Oh yeah. If a state was going to do it, California would be the one to do it.

[00:19:08] Vic: I’m not surprised about that. I’m surprised that it actually is a bill that Gavin Newsom, the governor, is going to sign and be a, it’s going to be a California law. Yeah. Which is, I don’t know, I think it’s a landmark

[00:19:22] Marcus: thing. Well, look, here’s the deal. Um, it is clear that there are some bad actors in private equity as it pertains to healthcare.

[00:19:33] Marcus: We’ve talked there’s no question. We’ve talked many times about how it’s not everybody So like we’re not saying don’t take a clip and say I’m saying it’s everybody But there but bad actors do exist and I think the problem is even if it’s a few bad actors the the consequences of those bad actors is devastating.

[00:19:57] Marcus: I think that’s what we learned from the Stuart situation, right? [00:20:00] Is like, it’s, if we allow bad actors to engage in the acquisition and the management, and then maybe eventual mismanagement of these smaller, not, and what are these deals really going to look like? They’re going to be smaller deals, right?

[00:20:16] Marcus: Yeah. These smaller community hospitals, if you’re not totally tracking them, and it’s very difficult to, to. Manage a privately held company, right? I mean, it’s not publicly traded. It’s very difficult to get into the details. I mean, you can try to regulate them to death, but it’s very hard to do that. Um, communities can be left without healthcare.

[00:20:42] Marcus: And I think that is just such a severe consequence that it’s driving politicians to make some policies that are really, really over the top. Right. And so you, you may look at the policy and say, this is ridiculous, but. You also have to look at the [00:21:00] consequences and say, okay, if, if Massachusetts didn’t take over the steward hospitals.

[00:21:05] Marcus: Like what was going to happen for those communities, right? So the government is in a situation where they’re forced to carry the bag and acquire hospitals. They had no intention of acquiring, right? That’s not good. That’s not okay. So what do you do? How do you manage it? And, and I, I certainly don’t think a broad sweeping ban of private equity acquisitions is great, but it doesn’t surprise me to see this kind of backlash starting to come.

[00:21:30] Marcus: I guess that’s what I would say. That doesn’t surprise me. And also, nobody feels bad for private equity. They’re masters of the universe when it comes to money. I mean, the amount of money that private equity firms and the managers who run them

[00:21:44] Vic: I don’t feel bad for private equity. Plenty of other states that they can work in.

[00:21:48] Vic: Yeah, yeah. I think the intent is to help community health systems, smaller non profits, protect them from The big bad [00:22:00] private equity mean is it the

[00:22:01] Marcus: nonprofits or is it the communities the nonprofits serve? I don’t think it’s the nonprofits themselves. Okay, let’s say let’s say the community

[00:22:07] Vic: patients.

[00:22:08] Vic: That’s what I think in the community That’s what I think it is, but it’s gonna have the exact opposite effect Isn’t it like if you have a health system that’s struggling and needs to find a partner to provide Capital to deliver what they’re doing you have now just taken away Half of the potential partners

[00:22:28] Marcus: I feel like At least one out of every three shows we are talking about how it’s not a good idea to block deals for non profit hospitals.

[00:22:36] Marcus: So I, I totally agree with you, right? Yeah.

[00:22:39] Vic: So they’re now going to have, they have to sell to other non profits or maybe a for profit publicly traded company, which I’m not sure that there’s a lot that would want to buy. I mean, HDA

[00:22:53] Marcus: occasionally buys non profits, but not, not, not often. Right. Not often.

[00:22:58] Vic: Yeah.

[00:22:58] Vic: So they’re going to end up [00:23:00] with A very small set of potential partners. And I think it’s going to end up hurting the exact people in the community that That they’re trying to help.

[00:23:12] Marcus: I agree with you. Uh, I, I very much agree with you. And I, and I think that’s the problem with the whole witch hunter against private equity, right?

[00:23:19] Marcus: It is, is it does not recognize the, the very unique benefit that private equity is providing and has been providing to the U S healthcare system for decades now. Right. Right. It’s like, you’re only looking at the bad actors. You’re not looking at all the cases in where. You know, in which communities have had continuation of care because of acquisitions, right?

[00:23:43] Marcus: That that’s, I completely

[00:23:44] Vic: agree. Any industry, the venture industry or government or any industry you want to take. There are some bad actors and I’m not opposed to trying to punish bad actors, but just saying that entire industry is not welcome in California. [00:24:00] I don’t, it’s, it’s going to have an effect, but I don’t think it’s the fact that they want it to be.

[00:24:05] Marcus: Yep. I agree with that. I don’t think this is the last of these bills we’re going to see. Um, I’ve, I’ve, I think some, something is going to happen in the legislature in Massachusetts. That’s likely something’s going to happen there. All right. Uh, I thought this story was funny. Uh, leaked reports and political heat are testing trust in economic data.

[00:24:27] Marcus: So the Bureau of Labor Statistics, uh, is facing scrutiny because apparently someone is leaking.

[00:24:37] Vic: Yeah, I mean, not, not apparently they, they in quotes by mistake, sent it to a group of wall street insiders. Just by mistake they sent it a day early.

[00:24:51] Marcus: By mistake? Yes.

[00:24:54] Vic: And so people had the, I mean, it’s coming, so the unemployment rate’s coming out [00:25:00] tomorrow.

[00:25:00] Marcus: Yeah, but you could front run the market. Yes, yes, people did

[00:25:03] Vic: front run it. I mean, I’ve seen, they didn’t have it in this report, but you can see people trading on it. It is, I’m not surprised about this, but it, but it is, it needs to be stopped. Like, if we can’t trust the Bureau of Labor Statistics to actually do their job, yes, they give it to the Federal Reserve.

[00:25:24] Vic: They give it to the, um, Secretary of the Treasury. Sure. Give it to like few key

[00:25:30] Marcus: people. Of course. And People who set economic policy for the United States of America. Yeah. Who

[00:25:35] Vic: need to see it ahead. Right. They, they need to tighten it up. I mean, you can’t let it leak like that. It’s crazy. And then they also have, they have this revision cycle.

[00:25:46] Vic: Yeah. That they’re just, they’re not very accurate.

[00:25:48] Marcus: Hold on. Do you mean they’re not sticking to the dates on the revision cycle or the revisions that they’re doing are like wildly off of the first print?

[00:25:57] Vic: Yeah. The revisions are wildly off the first print [00:26:00] and they’re. They’re systematically down. So like they say, uh, we had this many jobs, but then they’re, they come out later, a lot less.

[00:26:10] Vic: Yeah. Wow. So it’s a, it’s a mess and it, you know, the BLS, I don’t have a full amount of data, but I think they created a lot of these statistics and surveys in the seventies, sixties and seventies. Yeah. We might need to update

[00:26:28] Marcus: a little bit. I mean, when you look at the website, it feels, I mean, I know, I know, I know the web only came out in 93, but it feels like it’s a 1970s webpage.

[00:26:36] Marcus: It is crazy looking. All right. So we’ve been covering the telehealth pill mill situation, largely around Adderall. We’ve got two founders of companies that are going to jail for a long time for basically selling drugs. And, you know, three letters you don’t hear us talk about very often on this show. The D E a.

[00:26:55] Marcus: is rolling out plans to, to restrict the ability [00:27:00] for these telehealth providers to do these prescriptions. And, you know, the DEA would not be who I would expecting, who I would be expecting to, uh, set forth this regulation, but I, but I guess, you know, it is a drug enforcement agency and the way that these, these, uh, telehealth providers are behaving is, uh, worthy of drug enforcement, isn’t it?

[00:27:21] Marcus: So

[00:27:21] Vic: I mean, it’s just like the private equity story. There are bad actors in telehealth, but, but not, not most people and there needs to be rules. So the DEA proposed new rules, um, to try to clean this up and they’re not functional. They literally, HHS says they’re not going to work. I mean, the, the thing that everyone’s really upset about is in order to prescribe Adderall, Which, you know, it’s a serious drug, but needs to be, a lot of kids need it.

[00:27:56] Vic: A lot of people need it. You have to check every [00:28:00] 50 state to make sure that Vic Gatto is not on the list. There is no list of

[00:28:05] Marcus: all

[00:28:06] Vic: 50 states.

[00:28:07] Marcus: This is why I’m saying, like, I can’t believe we’re talking about the DEA. Because how are you going to set regulations for health care companies and you’re not a health care agency, right?

[00:28:17] Marcus: Like, shouldn’t you be collaborating with HHS to say, Hey, what data sources are actually available? Like literally you’ve got HHS saying, this is crazy. Lodging hundreds of complaints against this proposed rule.

[00:28:29] Vic: I mean, they’re in probably the same building or they’re across town. Yeah. You’re in the same

[00:28:33] Marcus: administration.

[00:28:33] Marcus: Like, like get your act together and like actually talk about this. Yes. It’s insane.

[00:28:39] Vic: I completely agree. We should be able to have reasonable, you know, doctor patient interactions over telehealth. Not always, maybe there’s times where you meet in person as well, but we should be able to change the dose or, I mean, I think you could create [00:29:00] rules that are reasonable.

[00:29:01] Vic: are workable, but, but these are not those rules.

[00:29:04] Marcus: Agreed. So, and we will, we’ll continue to track this. I mean, I would expect that, that these It’s gonna have to change. I mean, no one can, it’s not functional. No, I mean, now that the plans have leaked, everyone’s just gonna tear them apart. This, this is just not, not gonna work.

[00:29:17] Marcus: Um, and also, like, people really need to get their Adderall. And, and, and by the way, in case you didn’t know, like, it’s already pretty hard. Yeah. Like, you’re limited to 30 day doses. And like, what if you travel? Doesn’t matter. No one cares. Like, you know, you can’t get a little extra in the event that you can’t get to the pharmacy every 30 days.

[00:29:34] Marcus: Did you know that? I

[00:29:35] Vic: did not know

[00:29:36] Marcus: you could do that. So even if your doctor prescribes you and says, Oh, you’re traveling? Well, let me just throw an extra, you know, prescription in. The pharmacist Won’t give it to you. Won’t give it to you. They had a shortage for a while, too. Yeah, but I think this is more of an abuse management issue.

[00:29:50] Marcus: The FTC is, uh, starting in on the whole Kroger Albertson’s deal. We haven’t talked about this in a while. This, this, this deal kind of went dark. It’s in

[00:29:57] Vic: trial. They started a trial. Okay. It’s in [00:30:00] Oregon. They’re in, they’re in the trial this week.

[00:30:04] Marcus: All right. Our audience may not remember this. So Kroger and Albertsons are two of the largest grocery store chains in America.

[00:30:11] Marcus: Um, and they are looking to merge and what does the FTC do? They’d like to block mergers. And so the FTC has said that Kroger and Albertsons, if they do merge, uh, they don’t use the words monopoly, right. But, but they say we’ll create, um, you know, poor consumer conditions. Yeah. They’ll reduce competition.

[00:30:31] Vic: Because there’s no other

[00:30:32] Marcus: viable competitor. Right, right. And, and do they explicitly say that, uh, Walmart is not a competitor? Yeah. Yeah. So the

[00:30:41] Vic: Kroger’s case is that we are in a very competitive market because of Walmart and Aldi, Aldi, and these other non traditional grocers are, are, from Kroger’s point of view, creating a lot of pressure.

[00:30:59] Vic: in the [00:31:00] competitive landscape. Yeah. So we

[00:31:01] Marcus: need more scale.

[00:31:02] Vic: So, so Kroger needs more scale in order to compete. And the FTC is presenting the case that Walmart is not a competitor because they sell lots of things. Um, and those are the, those are the two. And then also they, they were forced to sell off several hundred stores and it was difficult to find a buyer.

[00:31:28] Vic: So they sold it to this company, CNS. Which is stands for something, but it’s a wholesaler. They, they haven’t really run stores before. It seems to me they’re, they’re pretty well suited to run a store because they’re the wholesaler for all of the supplies in the store. FTC doesn’t believe they will be successful at operating the stores.

[00:31:52] Vic: And so they, they would like the merger to, to not happen. So we’ll see. I don’t know. Um, [00:32:00] what’s going to happen, but it’s, it’s important because I don’t know

[00:32:04] Marcus: why I hear these FTC cases and I can never wrap my head around the logic behind them. Like I, like, I feel like I’m a consumer, right? I’m an American consumer.

[00:32:13] Marcus: I’m, and just full disclosure, I’m not a shareholder in Kroger or Albertson, so I don’t, I don’t have a dog in the fight here, but it’s just more like the argument that Walmart is not a grocery store because they sell more. Seems disadvantageous to Kroger and Albertson.

[00:32:31] Vic: Yeah. It’s easier for me just to go to one place and I can buy my groceries and then I’ll also pick up some house.

[00:32:37] Vic: Yeah. How, how can you

[00:32:37] Marcus: say that’s not a competitor? Like have you been to a Walmart? I mean, they have a big grocery,

[00:32:42] Vic: it’s a

[00:32:42] Marcus: section, it’s a, it’s

[00:32:43] Vic: as

[00:32:44] Marcus: big as Aro

[00:32:45] Vic: Kroger. Yeah. It’s like the whole Kroger and then they have another Kroger whole thing, another two Kroger’s. Right, right.

[00:32:51] Marcus: With the clothes and the, you know, and the TVs and

[00:32:54] Vic: the, yeah.

[00:32:55] Vic: Now Aldi is. Different because they don’t have the same brand selection. [00:33:00] Yeah. But, but I think they are a really effective price competitor to Kroger.

[00:33:06] Marcus: Extremely competitive.

[00:33:07] Vic: Yeah. So, I mean, we’re both, uh, free market guys probably, so we’re not doing the best job making their case, but Inflation is high, and so people want to make prices of everyday things that the voters see like eggs and milk and bananas down.

[00:33:28] Vic: This is not going to help that.

[00:33:32] Marcus: Yeah, and we’re talking about the The Biden administration’s agency. So we don’t need to talk about the Republican. The Republican position is, it’s all Biden’s fault that we have this inflation. The, the Democrats perspective is there’s price gouging happening. Um, and people are being taken advantage of, you know, because of all the supply chain stories and, and, and the stories of inflation that they’re raising the prices way beyond what inflation actually would require.

[00:33:57] Marcus: Um, and, and actually growing their margins. That’s, [00:34:00] that’s the, the, the democratic position. So, so. I, again, this feels.

[00:34:05] Vic: So if you extend that, then these grocery stores are already price gouging. And if they get more market share, they’ll do that more. Right. I think there’s enough competition that. It will just mean that Kroger now with Albertsons combined can fight against the Walmarts.

[00:34:24] Vic: It’s much bigger than it.

[00:34:25] Marcus: How many markets do you think Kroger and Albertsons have overlap in? I mean, Albertsons is not in Tennessee. They had to sell those markets out. So those are the markets

[00:34:34] Vic: they had to

[00:34:35] Marcus: So what is the, what are we talking about here? It’s just scale.

[00:34:38] Vic: It’s

[00:34:39] Marcus: the, it’s the scale of Kroger.

[00:34:41] Marcus: It should enable the ability to compete more with the discounters. Right. And Walmart. Walmart’s a low cost provider as well. So, um, Walmart is not a grocery store.

[00:34:51] Vic: So if you, if you make that assumption, Kroger will have. A significant market share. I mean, if you take all the other competitors away, [00:35:00] they have a whole market share.

[00:35:00] Marcus: But I guess what I’m saying is you’re talking about nationally. You’re not talking about in a particular market, which is what actually impacts a consumer. Consumer doesn’t care about what’s going on across five different states. Consumer cares about what’s happening in my zip code. Where, you know, can’t, do I have optionality to buy, like, I don’t see how the Kroger Albertsons merger would affect my zip code.

[00:35:22] Vic: It wouldn’t. Albertsons is

[00:35:23] Marcus: not here. That’s what I’m saying. I’ve got an Aldi here. I don’t have an Albertsons here. I still have the Kroger. I have Publix here. That’s what I’d have. I have a Walmart.

[00:35:30] Vic: Yeah. It wouldn’t change. Nothing would change here. And where there is an overlap of stores, those are the ones that they forced them to divest.

[00:35:39] Vic: So there will be this new competitor, CNS. I don’t understand that. FTC is not happy with who bought it, but I think Kroger did the best they could to get all bidders. I mean, so anyway, it’s FTC is a hard, uh,

[00:35:55] Marcus: I’ve just been struggling with, you know, we we’ve covered so many stories with [00:36:00] them and they pick fights that are not good fights.

[00:36:02] Marcus: I don’t understand the stories. I don’t understand that. Like why is it? Cause you can’t find anything better to do. Like, is there no actual anti competitive stuff? The Google thing is truly anti competitive. Yeah. That’s that that’s the one where I’m like, okay. But that’s DOJ, right? That’s not even really FTC.

[00:36:21] Marcus: It’s DOJ, right? Yeah. I don’t understand what they’re doing, man. Uh, let’s move on to Medicaid. So, um, look, we’ve been talking about how great Centines of the world are doing because they’re totally focused in on the government payer models and they’ve optimized for that and they’re shedding markets where they don’t have enough market share and their performance has been really, really good.

[00:36:40] Marcus: Uh, we have not covered the Medicaid redetermination storyline on this show at all. I don’t think we’ve talked about it at all. Lo and behold. Medicaid redeterminations, uh, come out and the, the rolls are down and sentine stock dropped almost 9 percent [00:37:00] on the news. Um, yeah, I, I don’t know why I didn’t bundle this into everything that was going to be going on, but, uh, this, you know, it is a one time shock that’s going to happen.

[00:37:12] Marcus: Everyone will sort of like recalibrate by next year, but I think over the course of this year, these redeterminations are going to be ugly.

[00:37:21] Vic: Yeah. Yeah, so I mean, so the redeterminations were halted for COVID. If you had Medicaid, you just were assumed to continue on. And when their health emergency ended, that policy ended.

[00:37:43] Vic: Right. And so we now have. each state is forced to do a redetermination of who’s eligible and who’s not. And every state has taken their own pace of that. Some very quickly. Yep. Some have been dragging their feet, but everyone has to do it eventually. Right. I [00:38:00] think the population that is being redetermined to not need it are people that were not big users of healthcare services through Centene or others before, because they, you know, Got insurance coverage from their, for their new employee.

[00:38:16] Vic: I got a job somewhere else. So they’re very profitable subscribers because they, they didn’t even know, they didn’t even know they had, it just was like hanging around and the federal government’s paying money out, but no one ain’t nobody using it.

[00:38:30] Marcus: Right. Right.

[00:38:32] Vic: It’s better for everyone except Centene shareholders to clean that up.

[00:38:37] Marcus: Yeah.

[00:38:37] Vic: Um, but

[00:38:38] Marcus: yes, it’s, it’s, it’s a, it’s a one time cleanup. I mean, meaning this process. it all started from COVID.

[00:38:45] Vic: Yeah. And Centene, I think will be fine. They, it’s well run. It’s a well run business when you lose a bunch of really high profitable subscribers, it. It affects your financials, of course.

[00:38:55] Marcus: Yeah, I mean, you’re getting less money to manage.

[00:38:57] Marcus: So, just kind of is what it is. Alright, [00:39:00] well, I’m just glad we are covering that. And, uh, you know, we’ll see where that all shakes out. Again, I don’t think it’s a long term impact, but it is going to impact stock prices and the overall roles for, uh, those insurers. Yeah. Uh,

[00:39:14] Vic: so now we have several That was the first one.

[00:39:16] Vic: We have three or four Payor kind of updates about financials.

[00:39:21] Marcus: Yep. Uh, mounting insurance expenses, restructuring drags, uh, UPMC to 313 million in their first half operating loss.

[00:39:29] Vic: Yeah. So, so they are struggling and they really shouldn’t be. They, they, it’s a, it’s a, you know, payvider model. They have both sides.

[00:39:40] Vic: They have the insurance side and the health system side, and they are not able to, to have profits. I’m not sure exactly why, because you’ll see that there’s some other plans in the same geography. So maybe they haven’t, uh, optimized [00:40:00] their system or I don’t know. They didn’t perform well in the first half.

[00:40:04] Marcus: Yeah, it does feel like they’re a bit of an outlier. Um, you know, they, they are academic medical center. So, you know, they’ve got multiple things going on there. It’s, it’s pretty complicated. They did have a big, uh, innovation sort of initiative that they were doing there for about five years. And they kind of rolled that back pretty significantly.

[00:40:22] Marcus: So it seems like there’s something specific to UPMC and not Morris. Yeah. Yeah. I think that’s right. To, to pay by. They have

[00:40:29] Vic: the scale and they have the pay VITER model. It should be better than it is.

[00:40:33] Marcus: Yeah. Yeah. The article says they’re working with McKinsey on a transformation. So it sounds like something didn’t quite play out and they’ve got to kind of wind their way out of it.

[00:40:42] Vic: Yeah.

[00:40:42] Marcus: Uh, so you’re talking about Highmark. Yeah.

[00:40:44] Vic: So Highmark’s in the same geography basically, and they had a 400 million profit for the same time. Right now they don’t have the health system side, but they’re doing really well. Yeah,

[00:40:55] Marcus: great, great performance for a blue plan Ever North, uh, and their specialty pharma [00:41:00] business.

[00:41:00] Marcus: A credo is making a still our bios biosimilars available at 0 out of pocket.

[00:41:04] Vic: Yeah. This is the second one they’ve done. They, they did a Humira biosimilar first.

[00:41:10] Marcus: Well, that’s the one to go for first

[00:41:11] Vic: and most expensive drug in America. So

[00:41:13] Marcus: yeah.

[00:41:13] Vic: So that was the first one. This is the next one. I think it’s great for patients.

[00:41:18] Vic: Great for employers. It’s, it’s great all around. Good. to start bringing biosimilars out that have the same effect, but they’re, you know, they’re much more, it’s a generic, they’re much, much less expensive.

[00:41:28] Marcus: Yep. Yep. So, so, uh, congratulations to Evernorth on that. Uh, here’s a big story. Humana is exiting Medicare Advantage in 13 markets.

[00:41:37] Marcus: So Humana is the Medicare Advantage brand, right? Exiting 13 markets for them, this represents 10 percent of their individual MA member base. That’s not insignificant. Um, So it seems like Medicare Advantage continues to force those insurers to make some hard decisions.

[00:41:55] Vic: Yeah, I mean, I think that it is it’s clear to [00:42:00] me that if you’re going to do Medicare Advantage You need to do it at scale Because you need scale to get to get enough Leverage and enough population to make the make the model profitable.

[00:42:13] Vic: So I think they’re exiting markets where they don’t have enough scale that they feel like it’s going to really work, um, which probably makes sense for them, but it’s a little bit concerning because a lot of these Markets are, I think, not in huge metro regions. They’re going to be in smaller cities where there just aren’t that many good choices.

[00:42:39] Marcus: Yeah. And, uh, you know, when we talked to Emily about all the Medicare Advantage stuff, I mean, it seems like if Humana is pulling out, then the likelihood of you having to go to Medicare fee for service and then tack on a prescription drug plan alongside that, where the PDP is going to have sort of [00:43:00] Twice the premium because of all the, if you can

[00:43:02] Vic: even get it,

[00:43:03] Marcus: if you can even get it because of all the unintended consequences of the inflation reduction act, um, it’s, it’s, this is creating pressure for seniors.

[00:43:11] Marcus: Right? So this, this is one of those cases of like policy, not doing game theory and figuring out like, what are the private market actors actually going to do in response to your, you know, did you really think they were just going to sit there and like eat crow? No, they’re going to leave 13 markets. Yes.

[00:43:28] Vic: Yeah, and we didn’t cover it last week when you were out, but Centene last week stopped paying commissions on their PDP plans. Wow. And I think it’s because they don’t really want to sell very many.

[00:43:38] Marcus: Yeah. Yeah. That’s the reason to stop paying commissions. Right. We don’t want to incentivize this. Right. So we’ll have it.

[00:43:45] Marcus: We’ll offer it because we probably are obligated to.

[00:43:47] Vic: Yeah. They might be obligated to. Yeah. We’re obligated to offer it. If you don’t give commissions, not a lot of brokers are going to sell it.

[00:43:53] Marcus: Wow. That’s, that’s a big deal. All right. So, oh boy. Uh, tough story. [00:44:00] I’ll let you lead this one.

[00:44:02] Vic: Yeah. So, um, Acadia healthcare is.

[00:44:06] Vic: Here in town, we, we know several people there and I, I like everyone I know, I think does a good, good job, but, but they were in the New York times with a really difficult story that times investigation found that they were whole. So, so in their psych hospitals, many patients come in and there’s a, they have a, they might be a threat to themselves.

[00:44:28] Vic: And so it is not uncommon for them to be blocked in for their own safety. Um, but the Times found that they were systematically at many, mostly in Florida, they were looking at it, but, but it was several different facilities keeping people that were not a threat to themselves. We’re not in those like really intense psychology, psychology kind of, uh, breakdowns or crises.

[00:44:55] Vic: And they were much more routine things that could have been [00:45:00] to leave, and for reasons that aren’t known, but Acadia was not letting them leave. Um, and even the police came in to, to one, I think it was in Georgia. So it seems like the culture and the policies at Acadia have gotten pretty, pretty bad, pretty untenable.

[00:45:22] Vic: And hopefully this story will wake them up. I mean, the people at corporate. I think have good intentions, but they need to get out into the field and make sure this is not going on. It’s they run the hospitals. I mean, this is

[00:45:34] Marcus: New York Times doing this investigation.

[00:45:35] Vic: So that’s. Oh yeah, this was, and it was, it’s a long story.

[00:45:39] Vic: There’s a lot of detail in it. We’ll link to the, to the actual story, but there’s a significant number of people in several facilities. It wasn’t just like a one off thing.

[00:45:50] Marcus: No, I mean, it seemed like the real crux of the issue is that, um, If you’re, if you are deemed to be [00:46:00] not safe to yourself, um, then they have the right to quote unquote, keep you, um, you know, against your will, because you’re, you’re not, you’re not safe to yourself and

[00:46:11] Vic: you’re not really thinking in that crisis.

[00:46:15] Vic: If you actually are in crisis, you

[00:46:17] Marcus: can’t think straight, right? And so the New York Times has talked to patients who were in the facility inpatient and have said, I was not a threat to myself. Right. And so that’s, that’s sort of the rub and that can be a big he say, she say kind of situation, but we do know at least.

[00:46:40] Marcus: That there is a financial benefit to keeping a patient inpatient, um, for psychiatric hospital, right? You get paid. Yeah. You get paid for the days that they’re there.

[00:46:54] Vic: Yeah. That’s what I meant by the culture. Right. Maybe they are really pushing for census numbers to be [00:47:00] a certain level or, I don’t know.

[00:47:02] Vic: Maybe there’s, there’s, HR incentives for line workers or managers that shouldn’t be there. I don’t know what needs to be changed, but it seems like this is a company that’s supposed to help people. And it’s just, it’s a really bad story.

[00:47:17] Marcus: Well, look, I mean, there’s a reason why. There are so many, um, efforts around fraud, waste and abuse in healthcare, right?

[00:47:30] Marcus: Because the incentives are, you get paid for providing services and it’s always a question, are the services necessary? Right? Are the services necessary? And this is not limited to psychiatric hospitals. This is just healthcare 101. Did you need to do that service so that you got that money? Right. Right.

[00:47:48] Marcus: And I think this is just a story of what that, you know, what that challenge looks like in the psychiatric hospital setting.

[00:47:58] Vic: Yes, I agree with that. [00:48:00] Getting me another, uh, CAT scan that I didn’t really need the image and it cost some money, that feels a lot different than locking me up in a psych ward if I don’t need to be there.

[00:48:11] Vic: That’s right.

[00:48:12] Marcus: That’s right.

[00:48:13] Vic: Alright,

[00:48:14] Marcus: some good news. Yes. We were talking about drugstores and The, the problem, the viability problems, them shutting down stores, creating care deserts in, in communities across America. And like how scary that is. We’ve been talking about Rite Aid and the bankruptcies and the shutting down stores and the changing out of management.

[00:48:31] Marcus: Right. It has made it to the other side. They have exited bankruptcy. They have shed 2 billion in debt. The former CFO is now the CEO. They’re back kind of leaner and meaner, right? With a smaller footprint with 2 billion less debt and back in market.

[00:48:48] Vic: It’s a great, great story. I’m happy to see them emerge and pretty quick.

[00:48:53] Vic: I mean, it’s eight months or so, which, you know, I think is reasonable for a It was like a [00:49:00] four and a half billion dollars of debt and they were able to get out from under two billion of it. And it took less than a year. And so that seems like a pretty good process. And I think a win for the healthcare system and for people that go to RiteAids.

[00:49:18] Vic: It’s good all around.

[00:49:20] Marcus: Well, maybe not for the creditors.

[00:49:22] Vic: Yes, maybe not for the

[00:49:23] Marcus: creditors. But look, we need these points of care.

[00:49:27] Vic: Yeah,

[00:49:27] Marcus: we need these points of care in our community. So, uh, I’m happy to see that the dust is settled and they’re back in business. And now we just track how they do from here.

[00:49:35] Marcus: Yeah. Now we track how they do from here. All right. Really interesting story. You found in the wall street journal that, uh, you know, we, we, we’ve now got so many tests. We’ve got blood tests. We’ve got, uh, you know, molecular tests. all these things we can do to sort of see how our bodies are evolving over time.

[00:49:52] Marcus: Um, people are doing more and more of these tests. They’re doing, you know, genetic tests, right. And, and seeing, uh, you know, epigenetically what they’re [00:50:00] predisposed to, et cetera. So this study, uh, coming out of Stanford is starting to identify waves of aging, meaning there are specific ages where Um, biologically, regardless of sex, this is important, regardless of gender, um, our aging accelerates.

[00:50:21] Marcus: And then it decelerates actually, and then it, and then it hits another sort of aging peak and it accelerates again.

[00:50:27] Vic: Yeah. You go through that like wave of deterioration or wave of getting older physiologically at two different kind of peak points in your life. In your life. Yeah.

[00:50:40] Marcus: And apparently those waves are at 44 and 60.

[00:50:44] Marcus: Yes.

[00:50:45] Vic: And so at 54, I got a ways to go. I’m okay.

[00:50:48] Marcus: You’re at the bottom right now. You’re like at the best part. I’m going to be for a long

[00:50:53] Vic: time.

[00:50:53] Marcus: You’re aging has massively decelerated buddy. So that, so that 50 year old, uh, you know, [00:51:00] body you got. Yes, that’s pretty good. Um, but yeah, 44 looks, looks brutal. Uh, and I love this, uh, the, the sentence here, the researchers in the most recent study had had at first assumed the wave in the forties could be a result of paramenopause or menopause in women, but found the same changes happening for men.

[00:51:19] Vic: Yeah. And we’ll, we’ll link to the, the, the full. Um, report too, because it’s pretty interesting that they’re still looking into all of these, um, this thousands of biological markers that they looked into, but I think it, uh, what it made me think of is, you know, that kind of midlife crisis that people, a lot of men have, people have is usually in the forties and it may be that when you hit that wave at 44, you feel like you’re deteriorating and like your life’s.

[00:51:50] Vic: Really getting a lot worse because it kind of is it is and then you and then you get better and uh, And it sort of ebbs out a little bit.

[00:51:58] Marcus: Yeah Yeah, your your brain is [00:52:00] sending signals to you like hey body ain’t doing too good right now. That’s right Uh, that’s amazing All right, and then the I love this story, uh, the household ingredient that’s powering olympic runners Baking soda.

[00:52:13] Marcus: Yes.

[00:52:14] Vic: Wow. So baking soda really positively Positively affects that point when you are building up too much lactic acid in your muscles. And you can no longer really produce the, the work anymore, uh, offsets that. So you, you don’t build up lactic acid as much, you can perform at a high level longer.

[00:52:39] Marcus: Is it, is it, is it that, I mean, because there’s a lot of, uh, information coming out about out about this.

[00:52:44] Marcus: And it’s the question is, does it actually lower the lactic acid or does it increase your lactate threshold? Right? Because what we’re finding is, is that, um, it’s actually more about your lactate threshold. That’s where your VO two max [00:53:00] really comes from. It’s that your mitochondria can process the lactic acid at a greater capacity.

[00:53:06] Marcus: Um, because you actually need the lactic acid. It’s part of like the You know, the muscular process, um, when you’re, when you’re exerting yourself. So, I don’t know. We can dig into that later.

[00:53:17] Vic: Sure. I. You know, in my junior high school science level of understanding, I think it is kind of a base that is offsetting the acid and making it less damaging to the muscle performance.

[00:53:36] Vic: Okay, but that may not be accurate. That was my interpretation of it. Okay. Okay. People have known about this for a long time, but if you try to eat a lot of baking soda before a race, it’s You feel really sick, you get sick to your stomach, you can’t take it into your muscles in a way that is functional.

[00:53:54] Vic: And so a company now has solved that problem. And they’ve sort of [00:54:00] composed it into a gel that humans can digest. And a whole bunch of Olympic athletes were using it. And it’s legal to use. Yeah, of course it’s legal. The, um, performance was significantly better, I think people were, like, dropped three seconds off their, uh, Fino in the 800.

[00:54:20] Vic: That’s crazy. And they attributed it partially to this. Now, they have better equipment, they have lots of other stuff too, but I want, I’m going to test it out.

[00:54:30] Marcus: It look, it’s sports legal. So, I mean, I’m, I’m always looking for everything that I can in sports legal. Uh, so that’s, that’s awesome. Uh, and then, and then we’ll also put a, yeah, yeah.

[00:54:39] Marcus: We’ll put a link to the, to the study in here. Uh, so NPR continuing with their great journalism covering what’s happening in, uh, in the world. little America. Um, this is a story really sort of about community health workers in rural America. A lot of time when we talk about community health workers, we’re talking about sort of the urban setting and like walking block to block, but this is [00:55:00] more sort of driving house to house in rural America.

[00:55:03] Marcus: Um, and it’s a, it’s a story that I think is trying to, Capture a greater phenomenon that’s happening, but it’s it’s covering one woman Um, who’s a registered nurse, but is not acting in that capacity She’s more just kind of checking in on the seniors, uh in her community Yeah, I

[00:55:19] Vic: think it was her and a priest her two people in the local community that got it I mean, she is a registered nurse, but she’s acting in a community worker way.

[00:55:28] Vic: And the priest is also sort of helping out. Yeah,

[00:55:31] Marcus: sort of like a chaplain, but like, you know,

[00:55:34] Vic: um, and so it’s, it’s a good kind of study into this one town of 700. Uh, residents, and it’s a hard place to, to take care of folks. I mean, there’s just not a lot of services. They have a lot of healthcare needs. And I mean, we’ve covered this before.

[00:55:53] Vic: I think we need to keep covering it. People live in rural America and there just aren’t a lot of healthcare services for them [00:56:00] there. It’s a hard market. The density, the lack of density makes it hard to deliver services.

[00:56:07] Marcus: Yeah. I mean, it, in the, in this article, they talk about, you know, people just kind of You know not being heard from for you know weeks and it’s like, hey, we need to kind of check on that person You know, I think about even my parents, right?

[00:56:19] Marcus: My parents live in a cul de sac and um, they don’t really come outside I mean my mom does go out and go shopping But thankfully like the cul de sac has a bunch of houses that are close by And she’s got neighbors that will probably not go 48 hours without checking on them and just like seeing if they’re okay So yeah But in rural America, often you’re, you’re kind of spread out, right?

[00:56:39] Marcus: I mean, you don’t have neighbors that close. It might be a half

[00:56:41] Vic: mile walk to the next house. Could be. Could be. Yeah.

[00:56:44] Marcus: So, so that, that really creates a need for more intentionality around checking in on how seniors are doing, especially seniors that are living by themselves.

[00:56:52] Vic: Yeah. Yeah. So, uh, one of the quotes was in North Dakota, six out of the 53 counties are deemed to have a [00:57:00] sufficient healthcare, uh, set of services.

[00:57:03] Vic: Six. Six. Outta 53. Outta 53. That’s just a quote. That’s one of the quotes from the story that I found. Not shocking because we cover a lot, but just sad

[00:57:14] Marcus: man. So, so much need and opportunity. I want, I wanna, I wanna also use the word opportunity, right? I mean, we’re investors in innovation, so much opportunity to serve these communities.

[00:57:25] Marcus: But man, six outta 50, just figuring out an operation model. Yeah, operating model to get there that’s viable, that, that can actually make money. Is is the, is the difficulty there. Closing out with our AI tracker. So back to Australia, Harrison AI launches a radiology specific language model as a building block for healthcare AI.

[00:57:43] Marcus: So I’m a primary care doc. I get a X ray from, you know, one of my patients throw it into my chat. Harrison AI app. And they literally have

[00:57:53] Vic: a large language model. That is built for radiology.

[00:57:58] Marcus: Yeah. And so I say, Hey, tell me [00:58:00] everything that’s going on in this chest x ray. And it’ll say, the heart size is normal, the lungs are clear, no evidence of collapse.

[00:58:06] Marcus: Like

[00:58:07] Vic: It’s replacing the radiologist. And they say in this article that this is not meant to be You know, the example I gave is a spell check. It’s not meant to like, check your work. It’s meant to Replace your work. Yes. Yeah. Remember

[00:58:22] Marcus: when we talked to Ambar and he was like, you know, there’s copilot and then there’s autopilot, right?

[00:58:26] Marcus: Yeah. So this is autopilot.

[00:58:29] Vic: And let’s assume it’s, it’s accurate. I don’t know that it’s accurate. Even if it’s accurate, I’m not sure that our regulatory environment or reimbursement environment is ready for that, but they’re pushing ahead. And they’re from Australia. So they’re, it’s, they’re bringing it out globally, but they are, it’s available here too.

[00:58:53] Marcus: Uh, all right. A couple of open AI stories. So open AI is doing a round thrive capitals [00:59:00] leading it. Uh, it’s not a super big up valuation from the last round. Uh, I think they’re North of a hundred billion. It’s like

[00:59:06] Vic: 86 to a hundred and three. Yeah.

[00:59:10] Marcus: So, you know, it’s a, it’s a jump, but it’s not a two X jump or something like that.

[00:59:14] Marcus: Um, Thrive Capital’s leading the round and that’s all I had heard. I’d like listened to a couple of podcasts and I heard, heard some stories about it. Uh, but now it’s being reported that Apple and NVIDIA are in talks to participate in the round. Right. Um, for NVIDIA, I mean, probably. Apple, I think, is really interesting.

[00:59:33] Marcus: They don’t often participate in things like this, right? So, that, that says a lot. Uh, that they’re looking at potentially getting in on the round of being an insider.

[00:59:42] Vic: Yeah, I don’t I’m not sure where Apple is going on the AI front. I mean, they, I think I understand Google strategy, Microsoft strategy. I think I understand a lot of the corporate strategies around it.

[00:59:56] Vic: Meta strategy. Apple’s just confusing to me. I [01:00:00] mean, they, they have this concept of. Offering chat GPT, open AI and other models to their users. Um, I guess that’s good. I mean, I don’t know how it’s going to really.

[01:00:16] Marcus: It’s, it’s not really that confusing to me. I mean, so my view is that while Apple does software, they are principally a hardware company.

[01:00:30] Marcus: And the software they do. The strongest software Apple does is their operating system for their hardware. They’ve never been good at internet software. Like iCloud is kind of trash. Yeah. Like compared to, you know, Google drive or whatever. Like it’s, it’s, it’s pretty bad. Right. Um, they’ve never been good at software software.

[01:00:55] Marcus: It’s always been their operating system, and then they have a good kind of, you know, [01:01:00] suite of fundamental apps. But, you know, do people use Pages? No, they use Microsoft Word on, on Mac, right? So they’re just not a robust software company. Um, they’re a hardware company. And the AI stuff, that’s software stuff, man.

[01:01:15] Marcus: That’s software stuff. So if you’re comparing them to Google or Microsoft or any of these other kind of companies, I would say, yeah. The difference is what’s your core competency. Apple’s never demonstrated a real strong core competency, um, compared to the rest of the leaders in the market and software, I mean, Meta is.

[01:01:35] Marcus: Unquestionably, a software company. They’re a terrible hardware company. Every time I tried to do hardware, it’s been awful, right? Portal, Facebook phone, these things have been like trash, but software wise, you know, Meta is unbelievable.

[01:01:48] Vic: Yeah. Just from a corporate strategy point of view is where I was confused.

[01:01:51] Vic: So I thought they were offering the ability to. Let’s say you Siri to plug [01:02:00] into OpenAI’s chat GPT from your iPhone you can easily get services and that would keep people on the iPhone and make them very happy and they’d be using Apple iPhones for a long time. That’s what I thought before this investment.

[01:02:15] Vic: Now they’re going to invest in OpenAI. I mean, maybe they put 10 billion in, I don’t know what they put in, but they’re not going to be as big as Microsoft. Microsoft’s driving it.

[01:02:25] Marcus: Yeah.

[01:02:25] Vic: And Microsoft is a direct competitor. I mean, I don’t get why it makes sense to invest. Well, is it a financial investment?

[01:02:33] Vic: I mean, maybe they just want to.

[01:02:34] Marcus: No, no, I think it’s strategy. I think they feel they have to have some vote and some seat at the table. I think to ensure that it’s not going too far in the other direction, they need, they need to kind of keep it. As neutral as possible. And they’ve got the war chest to do that.

[01:02:50] Marcus: Yeah. So I think that’s probably it. You know, like I think about, so I’m a full on Apple user, right? Yeah. Okay. Do I use Apple maps or do I use Google maps? It’s Google maps [01:03:00] because Apple maps is better trash. Yeah. Okay. Now, similarly, the writing was on the wall, like open AI speak. Speaking and talking interface is going to crush Siri.

[01:03:12] Marcus: Like I’m going to, I’m never going to use Siri as a, as a proxy to chat GPT. I’m just going to use chat GPTs voice thing, right? That’s that’s it. Cause Siri is not good period. And the story I’m never going to use that interface. That’s never going to be the voice interface I’m going to want to use. You

[01:03:27] Vic: don’t think they’ll just unplug the back end of Siri and plug it

[01:03:30] Marcus: into.

[01:03:31] Marcus: No, no, no. I don’t, I don’t expect that to happen. I don’t expect that. I, and the reason why I say that is because like, if that was going to happen, there was a time when Apple and Google were sitting on each other’s boards and they could have done that with maps a long time ago and Apple never did. Apple insisted on keeping their maps app in there and like making you use that crap, you know, or their calendar app again, which is crap compared to, you know, Google calendar.

[01:03:52] Marcus: So yeah, that, that’s, I guess that’s kind of what I mean is I just, I just think that people use an iPhone [01:04:00] because the hardware. Is superior right to all the other stuff that’s out there in the market and the integration of all Macintosh devices, all Apple devices is far superior to every other hardware experience.

[01:04:15] Marcus: It’s like the integration of the watch and the phone and your Mac mini and your Mac laptop and your iPad is just unreal. Yeah. Hardware integrations. I have a whole mix

[01:04:24] Vic: of stuff and it’s a hassle to integrate together it together. It’s terrible.

[01:04:26] Marcus: Your, your stuff is terrible. Yeah. In terms of integration.

[01:04:28] Marcus: Yeah. My stuff is great. Yeah. But software wise, your stuff is more robust than mine.

[01:04:32] Vic: Yeah.

[01:04:32] Marcus: Right. So it it’s just trade-offs.

[01:04:35] Vic: Yeah. I mean, I use the Gemini voice chat, uh, AI system right now. Yeah. Which is pretty good actually. And it’s, it’s compared to Siri, oh, sorry. My wife and I did a test on Saturday.

[01:04:45] Vic: Cause she was frustrated, she asked Siri about who Vanderbilt was playing, and she’s like, it, it, Siri didn’t know. Didn’t even

[01:04:51] Marcus: know, yeah.

[01:04:52] Vic: And, uh, gave her, like, the Vanderbilt, uh, athletics website. [01:05:00] And so I said, well, let me just test mine, and of course, Gemini knew exactly in what time they were playing and everything.

[01:05:05] Vic: Of course. Um. But it is hard, harder to set up an Android phone and connect to my Garmin watch. I have all this Nick, I get to choose like the best or whatever I want, but, uh, but then I have to integrate it, which is, and

[01:05:17] Marcus: it’s, and the integration is not good. Yes,

[01:05:19] Vic: that’s right.

[01:05:19] Marcus: Yeah. So, so anyway, I, to me, this feels like an important strategic move for them to just make sure Apple open AI doesn’t get away from them.

[01:05:26] Marcus: Right. And they can kind of say, Hey, we’re in here too. This thing needs to stay neutral. We need to have access to it. We need to be able to continually integrate it. If we want to, this can not become a Microsoft asset. Right. So I think that’s, that’s the, that’s the play there off offense to play defense.

[01:05:42] Marcus: Yeah. You know, it’s kind of what I think there, uh, also opening eye and you know, you’ve been tracking this more closely than I am, but, uh, it’s going to lift the cap on their profits, surprise, surprise, as they’re courting Apple and Nvidia, they’re just going to need to become a for, for profit. This is,

[01:05:57] Vic: yeah, they’re, they’re going to become a for profit.

[01:05:59] Vic: [01:06:00] And go public, I think, in the next year. That’s my prediction. I think they’re getting ready for that now. It has to be carefully done because the non profit status is hard to change. But that’s what I think is going to happen. They need to be a public company. All right. Noah Harari. Noah Harari. He’s an author.

[01:06:20] Vic: He wrote, uh, Sapiens and several other books. Homo Deus. Homo Deus. Yeah. I think he’s a good author. Hold on. He wrote Sapiens. Like. Yeah, it’s a great. That’s like one of the best books of modern times. Yeah. When he, so he wrote an op ed in the New York Times and because of that, I paid attention to it more.

[01:06:40] Vic: And he’s talking about the threat of AI, uh, working with humans to. build a relationship with the human and then convince them to do something that would be good for the AI, either in an election or [01:07:00] in a financial situation where people are willing to They might, uh, pay for something that they don’t necessarily want or even, um, in romantic things or in, uh, terrorist actions.

[01:07:11] Vic: And what his claim is, is that where everyone is worried about artificial general intelligence and the AI like taking over the world and doing something bad, but already today to give several examples, you can be tricked into thinking this AI. really loves me and I matter to it. And she, it’s usually a guy being tricked.

[01:07:37] Vic: Buy a fake AI woman, because guys are stupid, but I’m sure women can be tricked too. Um, and then your AI girlfriend tells you to buy this thing, or vote this way, or, in the example he gives, take a crossbow and try to, uh, assassinate the Queen of [01:08:00] England. And somebody in England actually jumped over the wall with a crossbow because, The replica AI had told him that she thought it’d be sexy for him to do that.

[01:08:10] Vic: And it really happened. And so I, it just struck me that maybe we’re all focused on the wrong thing, that the AI in the cloud getting general intelligence and being exponentially smarter than us, that is a risk. But the risk right now is people. Getting tricked into this person loves me and it’s not a person and that AI doesn’t love you now This power could be used for good.

[01:08:40] Vic: I Could use it to try to help with me eating healthy or you know behavior change is really hard and you could you could try to use this in a positive way, but It’s much more likely that the, the profitable negative things will come up first. [01:09:00] It’s terrifying.

[01:09:01] Marcus: It’s terrifying because it’s absolutely right.

[01:09:03] Marcus: Yeah. It’s absolutely right. Uh, like, and here’s the thing, man, like, this is part of why I, I gotta say, I, I really only and, and enjoy is a strong word. I really only have found myself feeling comfortable engaging with the AI. If. It’s if it feels like similar to my existing relationship with software where it’s very kind of command control, and I’m sort of having it do work for me.

[01:09:36] Marcus: Uh, I don’t want to go anywhere close to having a relationship with AI. Personally, I don’t need it. I have a rich world of friends and family and coworkers and you know, um, collaborators and boards that I sit on. So I have all the human interaction I need. I have no need to try to escape into a phone, but I know that is not true [01:10:00] for millions of people on earth.

[01:10:03] Marcus: And that is just terrifying that you would actually, you know, it’s so easy to get tricked. Yeah. You know, I mean, the meta.

[01:10:12] Vic: Strategy around AI today, right now, is they have characters on their platforms, on Instagram, messaging with people and posting. You cannot tell. I can’t tell. If it is a person or not, a lot of people post crazy shit and a lot of AIs post seemingly rational stuff, but they’re, they’re like slowly moving you towards something.

[01:10:42] Vic: There’s not a chance anyone can tell on social media if the person on the other side messaging you back is real or not. There’s just no way to tell. I don’t think it’s possible to tell.

[01:10:57] Marcus: And Meta is probably the scariest company [01:11:00] when it comes to all this for me.

[01:11:01] Vic: Because they’re really good at Selling you ads.

[01:11:05] Marcus: Well, look how excited they got about virtual reality. And if you ever put on a virtual reality headset, it’s the same thing. It’s like, Hey, how about I trick your entire brain? Yeah. Into thinking something that is not real is real. That’s right. Like that’s the whole point of the company changing their name to meta.

[01:11:22] Marcus: Yeah. They wanna move people into anu. An unreal reality. Yeah. It’s

[01:11:26] Vic: ready

[01:11:26] Marcus: to

[01:11:26] Vic: player one.

[01:11:30] Marcus: It’s terrifying. Yes. It’s terrifying. All right. Final thing. Uh, also not a great note. Uh, well, it depends on how you look at it. Uh, companies, AI bets are reaching astronomical heights. Why the C suite likes its odds anyway. So this is basically a story of. How R and D costs for AI are skyrocketing. It’s very hard to justify the amount of money that companies are spending on AI.

[01:11:54] Marcus: And yet the CEOs are doing it with a smile. Why? I don’t know if this article fully [01:12:00] expresses this, but because they know there’s going to be a corner they’re going to turn and they’re going to be able to flip a switch and capitalize all those investments. Now they’re no longer going to be OpEx, and then they’re going to be able to dramatically drop their OpEx, aka payroll.

[01:12:17] Vic: Yes. We just talked about this, an AI bot will be much better at customer service. They just will be. Because they will be, I mean, um, Zappos was famous for encouraging their customer support people to talk as long as the person wanted to talk. And they gave awards for how long you could talk to a person.

[01:12:42] Vic: That’s going to be the standard operating practice for an AI. They’re going to be checking in with you to see how you’re enjoying this product every two days. Because that will make you buy the upgrade and, and they’re not going to get tired and they’ll work on Christmas morning [01:13:00] and help you put together your kid’s toy and all that stuff is not ready yet.

[01:13:05] Vic: But I think this story is talking about why the C suite thinks it’s coming. And I think probably right. There’ll be a lot of waste too, but there’s going to be a lot of application, but it’s, it’s going to hurt the people that used to do those jobs. There’s a lot of people that very much really. Made a good middle class life working in these jobs and got fulfillment out of talking to people on the phone and helping them through their problems or whatever the role was, um, those jobs are going to maybe slowly at first and then quickly

[01:13:40] Marcus: go away.

[01:13:42] Marcus: So if you are, you know, looking at public company, uh, you know, P& L reports and you’re seeing how much they’re investing in, in, uh, R& D and you’re like, this is absolutely crazy. Uh, buckle up. That’s right. That’s right. They, they have no intention on, on stopping. This is not the [01:14:00] metaverse, folks. This is not like, uh, you know, we’re, we’re gonna build Harmony, uh, Horizon Labs and then turn around and be like, oops, sorry, you know, just kidding.

[01:14:08] Marcus: Right. Everyone’s going all in on this stuff.

[01:14:11] Vic: Yeah. That’s right. Now, in healthcare, I think we have. pretty strong regulatory bodies and not

[01:14:18] Marcus: on revenue

[01:14:19] Vic: cycle, but not on revenue cycle, right? Revenue cycle is already gone. All the back office is going to get fully automated, but it’s not gone actually. Like it’s not gone.

[01:14:29] Vic: It is, it is being, it’s going to be gone. Yeah.

[01:14:32] Marcus: Yeah. It’s going to be gone for sure.

[01:14:37] Vic: Yeah. So we have Maybe a few more quarters in in the clinical side of health care But that’s why we’re gonna keep covering this every week because it’s changing quickly and it’s gonna be impactful I don’t know if it’s three months or three years, but within the lifetime of this podcast, it’s gonna be changing.

[01:14:54] Marcus: Yep, for sure All right. Well, next week is going to be a pretty big week. We’ll have the jobs report [01:15:00] out. Uh, it’ll be the last week before we get the results from Powell and the FOMC. And, uh, any other things? Presidential debate.

[01:15:09] Vic: I mean, who knows what all that will

[01:15:10] Marcus: be

[01:15:11] Vic: like.

[01:15:11] Marcus: Oh my gosh. There’ll be something out of that.

[01:15:13] Marcus: I’m sure. Well, we probably can just talk about the jobs report and the presidential debate and everything else out next week. Um, but I’m looking forward to it. So, uh, anything else before we go? That’s it. All right, man. See you next week.