Ben Okonkwo: Jonathan, hey — still recovering from that report I sent you, or did you actually get through it?
Jonathan Ingles: I got through it. Twice. Which I resent, frankly.
Ben Okonkwo: Right — because there's a number in there that I keep staring at and I want to just hand it to you cold. Twelve billion dollars. That's what Accountable Care Organizations have saved Medicare. Total. Over fourteen years.
Jonathan Ingles: Sit with that for a second.
Ben Okonkwo: Now divide it across the U.S. population and the time period. You get to eighty-six cents. Per American. Per year. That's the yield on more than a decade of bipartisan health reform.
Jonathan Ingles: Eighty-six cents.
Ben Okonkwo: And meanwhile — UConn Health's population health program puts treatment at roughly ninety percent of the U.S. healthcare dollar. Population-based prevention gets somewhere under two percent. So the reform era has been running for over a decade and that ratio has basically not moved.
Jonathan Ingles: Look, the UConn Health figure — I want to come back to where exactly that lives, because that level of precision is doing a lot of work. But even if the real number is four percent, or six, the direction is the same. Value-based care enrollment plateaued in 2018. It covers thirty-six million people. Fee-for-service is still the dominant architecture after — what, fifteen years of everyone agreeing it's broken?
Ben Okonkwo: So that's the question, right — why does a system full of people who are not stupid, not cartoonishly malicious, keep making the same apparently irrational choice?
Jonathan Ingles: That's the whole thing. And I'd argue the answer is that it's not irrational at all — which is actually the more uncomfortable conclusion.
Ben Okonkwo: The uncomfortable conclusion being that the system is — okay, so think about a mechanic. A car that runs perfectly earns them nothing. The moment the engine seizes, though — tow truck, diagnostic, parts, labor, all billed separately. That's the whole thing in one image.
Jonathan Ingles: The heart attack is the seized engine.
Ben Okonkwo: Exactly that. And it's not one bill — walk through what a cardiac event actually generates under fee-for-service. Emergency transport is a billable code. Hospital admission, separate. Diagnostic imaging, separate. Catheterization. Stent placement. ICU stay. Then rehab. Then the pharmaceutical tail — statins, beta-blockers, potentially for the rest of that person's life. Each one discrete, codeable, reimbursable.
Jonathan Ingles: Every single handoff generates revenue.
Ben Okonkwo: Now set that against the prevention side. Diet counseling. A smoking cessation conversation. Blood pressure monitoring. Those payments are low, they're dispersed, and — this is the part that I think people don't sit with — you can't really attribute the avoided heart attack to any of them. The payment arrives years later, if it arrives at all, and no one can prove your fifteen-minute intervention is why it didn't happen.
Jonathan Ingles: Which is why AHRQ's finding lands so hard. Primary care — the whole setting where prevention actually happens — gets reimbursed at significantly lower rates than specialty and procedural care. It's not incidental. The architecture of fee-for-service built a structural shortage of prevention capacity. You pay less for the room where the work would occur.
Ben Okonkwo: Right — and that shapes supply. Fewer primary care physicians relative to specialists, fewer slots, longer waits. The shortage isn't random.
Jonathan Ingles: No. It's downstream of the payment signal.
Ben Okonkwo: So the treatment-prevention revenue asymmetry — that's where most conversations stop, right? Fee-for-service rewards volume, acute care pays more, prevention loses. People nod, say 'yes, very bad,' and move on. But I don't think that's actually the load-bearing piece.
Jonathan Ingles: It's not. It's the surface layer.
Ben Okonkwo: Because even if you accept that the FFS architecture is the problem — and the National Academy of Medicine and the Milbank Memorial Fund both frame it roughly that way — you still haven't explained why value-based care, which was designed specifically to rewire that signal, hasn't displaced it. That's the stranger question.
Jonathan Ingles: And frankly it's structurally weird. Because 'we built a better incentive and asked people nicely to adopt it' turns out to be — I mean, that's not a reform. That's a suggestion.
Ben Okonkwo: There's something underneath the incentive problem that the incentive fix doesn't reach. And I think that's where we need to go.
Jonathan Ingles: But here's what that framing still doesn't explain — okay, so fee-for-service is broken, fine. What about insurers? Insurers aren't billing per procedure. They have a financial exposure to sick populations. Why aren't they just — quietly, on their own — investing in prevention?
Ben Okonkwo: That's exactly the thing that breaks the clean version of the argument. And the National Academy of Medicine has a name for why that logic fails — they call it the wrong pocket problem.
Jonathan Ingles: Walk through it.
Ben Okonkwo: So — an insurer funds a hypertension screening program. Pays for the intervention today. But the avoided cardiac event is fifteen years out, maybe more. And the insurer almost certainly won't be covering that same person fifteen years later. The person changes jobs. Changes plans. Moves to Medicare. The downstream savings land in a completely different pocket from the one that paid upfront.
Jonathan Ingles: So it's not even a question of payoff period. The payoff goes to someone else entirely.
Ben Okonkwo: Right — and the Milbank Memorial Fund tracks exactly this. They find that preventive care keeps struggling financially even inside value-based care frameworks, because — I mean, this is the part that surprised me — the temporal mismatch survives the payment reform. You change the label on the model, the cash flow problem is still there. Prevention costs upfront. Savings arrive years out. That gap doesn't close just because you renamed the contract.
Jonathan Ingles: Wait — so value-based care was supposed to be the fix. And the Milbank finding is that it didn't actually fix this specific thing?
Ben Okonkwo: That's the finding. The temporal mismatch persists regardless of the payment label.
Jonathan Ingles: Frankly, that's the part people gloss over. They treat value-based care as a solved problem and move on. But if the Milbank Memorial Fund is documenting that prevention still underperforms financially inside VBC — that's not a rounding error. That's the reform failing at its core task.
Ben Okonkwo: Now make it concrete. Picture a benefits manager at a mid-size company. Tuesday afternoon, approves a hundred-and-eighty-dollar-per-employee hypertension screening program. Eighteen months later — not fifteen years, eighteen months — half those employees have changed jobs. Their lower cardiac risk, the thing that program actually produced, walks out the door with them into a competitor's health plan. The company that paid sees none of the savings.
Jonathan Ingles: And that's not an edge case. That's the median scenario.
Ben Okonkwo: It's the median scenario. Which is what makes this a collective-action problem, not just a misaligned-incentive problem. One organization bears the cost. The benefits diffuse — across multiple payers, across future years, across people who've already left. Even a genuinely well-intentioned actor, a hospital system that actually wants to prevent disease, faces a cash flow structure that punishes them for doing it.
Jonathan Ingles: The fact is, that distinction matters. Irrational system versus rational actors in a broken structure — those require completely different responses. One you fix with better incentives. The other... and look, there's a layer under even this that we haven't touched yet — where the people who'd lose revenue if prevention worked are the same people lobbying against the redesign.
Ben Okonkwo: Right — and that's the piece that makes the economics of this genuinely stuck, not just technically hard. We'll get there. But the wrong pocket problem is why even a well-designed reform hasn't closed the gap — the math still doesn't work for the person writing the check.
Jonathan Ingles: But the wrong pocket problem still assumes good-faith actors who just face bad math. What the National Academy of Medicine actually names — explicitly — is lobbying. Intense lobbying, their word, against resource reallocation. By stakeholders who profit under the current payment system. That's not a design flaw. That's a defense mechanism.
Ben Okonkwo: NAM says that directly?
Jonathan Ingles: Directly. Not implied. They name it as a persistent structural force. Not a side effect of the system — a feature of it.
Ben Okonkwo: Okay, so — and this is where I want to separate two things — there's the lobbying story, which is a political economy story, and then there's a deeper structural reason why no commercial actor ever steps in to champion prevention independently. Even without the lobbying. The pharmaceutical patent system.
Jonathan Ingles: Say that more carefully.
Ben Okonkwo: The patent system rewards novel therapeutic compounds with monopoly pricing. Temporary, but real. That's the commercial engine behind every drug that gets developed. Now — lifestyle intervention. Behavioral prevention. You cannot patent 'walk thirty minutes a day' or a dietary change. There is no monopoly. There is no revenue motive. So the absence of a prevention drug isn't an oversight or a gap waiting to be filled — it's a structural outcome. The system is working as designed, it's just designed around patentable things.
Jonathan Ingles: Which means the commercial champion for prevention will never arrive. Not late — never.
Ben Okonkwo: Never. And then Bugbee, 2026 — private equity layer on top of that.
Jonathan Ingles: Right, and this is — frankly this is where I think the framing has been too charitable. Bugbee's argument is that private equity's debt-based structure doesn't just create misaligned incentives, it actively incentivizes revenue extraction. Push the high-margin procedural volume, service the debt, exit. Bugbee calls that extraction. And the prescription isn't incremental reform — it's regulation. That's a different category of claim.
Ben Okonkwo: I want to be careful there — I mean, is private equity the primary brake, or is it accelerating something fee-for-service was already doing? The direction might be the same but the cause matters if you're designing a response.
Jonathan Ingles: Sure. But Bugbee's point survives even your version. If fee-for-service was already pointing the wrong direction, private equity's debt structure turbocharges it and removes any internal check. You don't need it to be the origin to need it regulated.
Ben Okonkwo: Now here's the number that genuinely stopped me. The Ottawa Charter for Health Promotion — that's forty years old. 1986. Formally declared healthy public policy the essential lever for health equity. Forty years. And prevention is still under three percent of health budgets across OECD countries. Forty years of formal commitment and the financing didn't follow.
Jonathan Ingles: That's not drift. That's a verdict.
Ben Okonkwo: And it's exactly what makes the question you raised unavoidable — is this a fixable design failure, or is it a politically entrenched arrangement that the right pockets are too powerful to dislodge? Value-based care enrollment plateaued in 2018, it's opt-in, it's voluntary. If the reform required asking permission from the people who benefit from the status quo—
Jonathan Ingles: You asked permission. That's the tell. Fourteen years, twelve billion saved, thirty-six million covered, and enrollment stops growing in 2018. Because the whole thing was opt-in. Voluntary. And the question I keep turning over — not the design question, not the incentive question — is: under what conditions does any stakeholder with actual power willingly surrender the revenue that treatment generates? I don't have an answer. I'm not sure there is one that doesn't require a political fight nobody's ready to have.
Ben Okonkwo: That's — yeah, that's where I land too. And the honest version is that the Milbank Memorial Fund data, the NAM framing, the wrong pocket problem — all of it describes the mechanism perfectly. None of it answers that question.
Jonathan Ingles: Frankly the mechanism is the easy part.
Ben Okonkwo: I mean — the 2026 Australian review of the Ottawa Charter keeps haunting me. Forty years. Forty years since prevention was formally declared the lever for health equity, and we're still at under two percent of the health dollar going to population-based prevention, using UConn Health's own estimate. The financing just never followed. And I don't know whether that's a failure of political will, or whether it's — I mean, is it possible the system is just doing exactly what the incentives tell it to do, and the people with power over those incentives have no reason to change them?
Jonathan Ingles: That's the question I can't settle. Fixable design failure, or politically entrenched arrangement. Those aren't the same problem and I'm genuinely not sure which one we're describing.
Ben Okonkwo: Neither am I. And I think that discomfort is probably the honest place the evidence leaves us.
Jonathan Ingles: Worth the two hours, though. Genuinely.
