Mario Schlosser, CEO of Oscar, spoke to Slate about launching a startup in a highly regulated industry like health insurance.
Interviewed by Seth Stevenson March 18 for Slate's "Who Runs That?" podcast, Mr. Schlosser answered questions about regulation, price transparency and "Medicare for All" proposals.
Three quotes from the podcast:
1. On entering a highly regulated market: "People don't start insurance companies overnight, and don't start them really with the backgrounds we had. I'm a computer scientist. I came at this from the engineering/technology sides, and really thinking members deserve a better user experience in healthcare. So that was certainly very daunting. We, at the same time, thought that the system is so obviously, so stupidly designed. There wasn't really anybody in the healthcare system who had an obvious incentive to try to get my healthcare costs down, frankly, to get me to go to more efficient doctors and doctors with better quality outcomes."
2. On price transparency: "We can get a lot farther in transparency of cost and quality than we are right now, and it will help some. … But I don't think you can put it entirely on the shoulders of the individual to make those decisions … to make sure insurers connect more closely and intensely with providers, with hospitals and doctors, and form more integrated entities. That's what we've done with the Cleveland Clinic, for example. We have a Cleveland Clinic health insurance plan called the Cleveland Clinic | Oscar insurance plan. It splits costs 50-50 and we have an incentive to be more open, very open about the cost there and really drive the costs as much as possible on both sides, and the outcomes at the same time."
3. On Medicare for All: "When people say 'Medicare for All,' the part I agree with is the part that says, we want to have coverage for everybody, and the government [has] to play a role in, if necessary, subsidizing that, and should play a role in making sure people are really getting coverage. … The part I don't agree with is to switch the entire thing over to a government-run system. And there's a very simple argument for it, which is that if you switch a system over into the government's hands that right now costs us 18 percent of [gross domestic product], you have two choices. Either you raise taxes a crazy amount for this, to pay for that, or you undo what's most off in [the] U.S. versus other countries, which is unit costs for doctors and hospitals. If you took those down to where they are in, let's say, Germany, Switzerland, Singapore — you would instantly bankrupt half of the healthcare system. Both of these avenues are fools' errands."