Solving Mental Health Access with Innovation and Strategic Care Models with Andy Flanagan, CEO of Iris Telehealth

[00:00:02] Hey everybody, welcome back to the Outcomes Rocket Founder Stories. Saul Marquez here and I'm so excited to be hosting the outstanding Andy Flanagan. He is the CEO at Iris Telehealth and he's responsible for the company's strategic direction, operational excellence and cultural success.

[00:00:22] He's got significant experience in all aspects of U.S. and global healthcare and he's focused on the success of patients and clinicians to improve people's lives as a previous founder of his own company and a leader in the health space.

[00:00:38] I'm excited to have him here on the podcast to talk to us about what they're up to at Iris Telehealth. So Andy, with that, I want to welcome you. Thanks for joining us.

[00:00:47] Thank you, Saul. Appreciate you putting this together. I love your series.

[00:00:51] Appreciate that.

[00:00:52] Thank you, sir. I appreciate that. And so, look, our series is nothing without the health leaders and founders like yourself. So talk to us a little bit about you. What got you into entrepreneurship, into leadership and healthcare?

[00:01:07] I left corporate America in my early 30s to start my first company, a software company. It was enterprise at a time when there were no enterprise SaaS companies. We had to build it from scratch. And as employee one, I was really excited about the opportunity

[00:01:22] to put a dent in the world and change the way that we thought about how things could be done. And that's with me today. I'm doing it at a different place. We were successful at that time. That company is still successful and profitable and going today. I have great pride in that.

[00:01:37] And I'm excited to be here at Iris doing more of the same.

[00:01:41] That's awesome. And, you know, it's a lot of the fundamentals and the principles. Oftentimes, I look at them as algorithms, right? You could repeat and make it happen. Talk to us about the work you guys are up to at Iris Health and how you're making a difference.

[00:01:56] We're focused on the mental health access challenge in our country. And we work with enterprise health systems and community mental health centers, federally qualified health centers. So, you know, the patient journeys are complete, pediatric, adult, geriatric, all diagnoses.

[00:02:12] And you can imagine with Medicaid, some of the stories are really tough. And as a country, we're trying to solve the access in a traditional way. Paper service, volume, more just doesn't work that way. There aren't enough clinicians. There isn't enough time in the day. We're all seeing the AI boom. AI as a informaticist at heart, the software person has been around for a long time, right?

[00:02:42] 70 years. And it still has yet to display its full potential. So for us, we're meeting patients where they are, helping health systems and community mental health centers survive and take care of their patients while we're trying to reinvent the whole industry. So we're doing both. It's super hard. We're just a bunch of corporate refugees here trying to do good work.

[00:03:05] I love that. Good image there, you know, of what's happening.

[00:03:11] And so, yeah, it is a problem, right? And access is a huge issue. So you highlighted Medicare and Medicaid, helping give them access. The FQHCs are a major source for care for many of these folks.

[00:03:29] Yes.

[00:03:29] What's the value prop, right? How are you guys able to deliver and provide options to these folks where funding tends to be a challenge?

[00:03:37] Well, first of all, we're a destination choice for clinicians. Our medical group, we have 430 employed clinicians, both two-thirds of which are prescribers.

[00:03:47] So MDDOs and psychiatric mental health nurse practitioners, one-third are therapists, LCSWs.

[00:03:53] The MPS score for our medical group is 91.

[00:03:56] Phenomenal.

[00:03:57] And it's not because the work is easy or they're not busy or it's hard work, but we have a managed service organization, 200 employees that support that medical group.

[00:04:07] Because we're specialists, we do that more effectively, cost-effectively, efficiently in terms of time and burden.

[00:04:15] We have a white glove concierge model for both our customers and our clinicians.

[00:04:20] And so when you get around to that story, that's the only way you can be the best at something is when you know exactly what your mission is and you stick to it.

[00:04:29] So we're very careful about the partnership we call customers partners, the partnerships and the partners we work with to make sure that we can deliver on the SLAs and the mission.

[00:04:40] So yeah, that's how we do it.

[00:04:41] We do one thing and we're focused on being the very best at it.

[00:04:44] That's great.

[00:04:45] And if we kind of like unpack that a little bit more, the specialization is critical.

[00:04:50] You've got the staff.

[00:04:52] How can people better understand how you deliver better?

[00:04:56] Healthcare is a process business, right?

[00:04:58] And so we have great companies that are focused on different points of the value chain.

[00:05:04] Software to help people register inside of a state, get licensed in a state.

[00:05:10] Software to schedule patients.

[00:05:12] Software, very fragmented.

[00:05:13] And it's the same thing with professional services organization, medical groups.

[00:05:17] Some people work just on therapy.

[00:05:19] Some people work just in the emergency department.

[00:05:21] We're a full value chain company.

[00:05:23] We're one of the few.

[00:05:25] We actually cover the full end-to-end process from the community coming from the home all the way through the health system outpatient, emergency department, medical surgical floor, and then following the patient back home.

[00:05:39] So we understand the patient journey and how it changes based on, you know, today I'm in my employer's insurance plan and now I'm actually in the hospital because I went to the emergency department.

[00:05:49] And now I'm actually in a long-term care facility and now I'm back home.

[00:05:55] And it varies if you're in Medicaid or Medicare or commercial, you're in the military.

[00:06:00] So our value prop really has been to be a strategic partner, even if it's for a federally qualified health center that is serving, you know, central California from Chico to Bakersfield.

[00:06:13] Super difficult migrant worker community, right?

[00:06:16] And we can understand and build a program that is both clinically and technology efficient out of the box because we've done this in 43 other states.

[00:06:28] We have hundreds of partnerships and we probably easily are in thousands of sites of care.

[00:06:35] We see 1.5 million patients a year of all different types.

[00:06:39] 40% of our patients are pediatrics.

[00:06:41] So, you know, you learn from the experience in our 11th year, you take that as long as you have a strong culture where you say, I want to learn and get better.

[00:06:50] You curate that knowledge and you turn around a better process.

[00:06:53] So we do a lot of root cause analysis.

[00:06:54] We study our failures.

[00:06:56] And one of our values is suck less every day.

[00:07:00] And that means, hey, it's going to happen.

[00:07:02] Like literally, like get better tomorrow.

[00:07:04] But let's not clarify ourselves that we made this mistake yesterday.

[00:07:08] Like we're all people.

[00:07:09] We're all trying to do the right thing.

[00:07:11] That combination, I would tell you that the number one reason we're here is leadership.

[00:07:16] Clinical leadership, we view clinicians as leaders because they make game time decisions in the middle of encounters that are life saving.

[00:07:23] But also our commercial leaders, our corporate leaders, directors, managers, that's really where this all comes together.

[00:07:30] There is no extra margin to go around.

[00:07:33] Everybody has to really be efficient.

[00:07:36] And if everyone doesn't own that, you make mistakes.

[00:07:39] You don't pay attention to the details.

[00:07:41] And as a result, you're not as efficient and you lose money and you go to business.

[00:07:46] No money, no mission in healthcare, right?

[00:07:48] Amen to that.

[00:07:48] So we're no different than our partners in terms of our need to be efficient and self-sustained.

[00:07:54] That's great, Andy.

[00:07:55] Thanks so much for highlighting that.

[00:07:57] It's a very clear differentiating segment to the business, the experience, the leadership across clinical as well as execution on the leadership side.

[00:08:07] So, you know, as you've been building the business, what's one thing that stood out as a major challenge?

[00:08:14] You know, as we build businesses, we find those challenges teach us way more than the successes.

[00:08:19] What's one that stands out?

[00:08:21] Early on, we thought value-based care would be the thing.

[00:08:24] I arrived in late 2020, followed the founder, child psychiatrist, incredibly disciplined leader.

[00:08:31] The company was profitable and successful, not as large as we are now, but it knew its job and did it well.

[00:08:38] And we anticipated that value-based care following post-COVID would move faster.

[00:08:43] Mm-hmm.

[00:08:44] Simply because you can't deliver mental health on fee-for-service basis over time and get there.

[00:08:50] The payers don't believe in it.

[00:08:51] The access isn't there to deliver in it.

[00:08:53] And so it falls down.

[00:08:55] We were wrong.

[00:08:56] Value-based care, an incredibly data-driven part of our world here in healthcare, and it's still carved out.

[00:09:03] And it probably will be for another seven years.

[00:09:06] Like, we're a long way away.

[00:09:07] And so when we built our platform, it really had in mind value-based care from the beginning.

[00:09:15] That was a mistake.

[00:09:16] And so we didn't over-rotate, but we over-invested in the complete total cost of care journey.

[00:09:25] And behavioral health, like many points of care, is very fragmented.

[00:09:29] You have a job, job's over, and now it's the next clinician's job, right?

[00:09:33] They leave the emergency department, and now it's back to primary care.

[00:09:36] And so we always have this holistic view of transforming the whole behavioral health value chain.

[00:09:42] So the mistake was thinking that value-based care would get there.

[00:09:45] Along the way, we actually discovered how to unlock the Rubik's Cube and do the whole thing.

[00:09:52] So there's a silver lining.

[00:09:54] But it took us all 16 months to become self-aware that we were wrong.

[00:09:59] Yeah.

[00:10:00] And thankfully, the data and like we kept looking at it saying, well, it's not moving, the voice of the customer.

[00:10:04] All those things, you just can't underestimate the power of data in this story.

[00:10:11] And healthcare sometimes gets so opaque for people, especially when we have technologist founders coming in saying, I'm just going to solve this with tech.

[00:10:18] We now know more.

[00:10:19] We have better access.

[00:10:20] We have better information.

[00:10:21] I can just unravel this problem.

[00:10:23] It's a consumer problem.

[00:10:24] Well, yes, it is, but it's also a regulated industry.

[00:10:28] And so we gave ourselves a long period of time because we had a strong balance sheet.

[00:10:32] We still do.

[00:10:33] And that's how we operate.

[00:10:35] We give ourselves about 18 months for a product to live or die, a service to live or die.

[00:10:42] And after about 16 months, we realized, yeah, we're just wrong.

[00:10:45] We're early.

[00:10:46] You know what I'm saying?

[00:10:47] Pioneers, you know, selling a haircut.

[00:10:50] You know, pioneers get scalped, right?

[00:10:52] Yeah.

[00:10:52] Get a haircut.

[00:10:53] So we're trying to only get haircuts.

[00:10:54] Little trips.

[00:10:56] I've heard pioneers get spears.

[00:10:58] Yeah.

[00:10:59] There you go.

[00:11:00] You got some spears, but you got away.

[00:11:03] I had to grab her.

[00:11:04] We have tap on.

[00:11:04] We're everywhere.

[00:11:05] That's cool.

[00:11:06] And well, and it sounds like along the way, you guys uncovered this opportunity for a very

[00:11:12] well-balanced, healthy end-to-end value chain business.

[00:11:17] So kind of position yourself for a better future as it does come true.

[00:11:22] What was the major reason that you think it didn't take, value-based care didn't take?

[00:11:28] So we just released our AI platform.

[00:11:31] It's really a machine learning platform versus an AI.

[00:11:34] You know, a lot of folks are focused on, you know, ambient and saving seven minutes or

[00:11:39] two minutes in the clinician's time.

[00:11:41] We're more about risk stratification, predicting who's going to use the emergency department and

[00:11:46] helping them before they go there.

[00:11:48] Intervening.

[00:11:49] DS.

[00:11:50] Value-based care rewards that behavior.

[00:11:53] Problem is on the payer side, prove to me that the person that you intervened with was

[00:11:58] actually going to go to the emergency department.

[00:12:00] And you can't because you prevented it.

[00:12:02] It's an alternate reality.

[00:12:04] Understood.

[00:12:05] And the actuarials often are very, you know, it's hard to find them sometimes.

[00:12:09] And so over the body of evidence and time, you know, behavioral health, there really aren't

[00:12:14] biometrics, right?

[00:12:15] It's all the data in the EHR is unstructured text.

[00:12:20] Can't take my blood pressure and realize that I'm going to go to the emergency department for

[00:12:24] a behavioral health issue, right?

[00:12:26] Might go for cardiology reasons.

[00:12:27] So it makes it hard to have good data for the payers who are ultimately writing the check

[00:12:33] to give the revenue share if we avoid cost.

[00:12:36] And so the first year you can say, well, just give me the patient.

[00:12:39] I'll take care of the patient.

[00:12:40] And without even saying why, if you save money, we receive a bonus check.

[00:12:45] The payer's like, well, you're going to have to be more specific than that.

[00:12:47] You have to show that you actually earned this in the second year.

[00:12:50] And that's really the problem.

[00:12:51] And so we are learning.

[00:12:53] And I think ML is a huge, this is a classification problem initially.

[00:12:57] It's really helping us.

[00:12:59] Some of the early drug discovery is very exciting around, it's coming out of some of

[00:13:03] the AI models.

[00:13:04] But I think in terms of value-based care, very specifically, it really is a root cause analysis

[00:13:09] and it's a data problem.

[00:13:10] It's the reason why value-based care is not yet in the age.

[00:13:13] No one can really understand the correlation between access and a therapist, a PHQ-9, and

[00:13:20] a lower cost.

[00:13:21] In order to retire, they will.

[00:13:23] But we're just starting, it's very little research, right?

[00:13:25] I love that.

[00:13:26] But, you know, unfortunately.

[00:13:28] Yeah, no, thanks for sharing that.

[00:13:29] And it makes a lot of sense.

[00:13:31] If they wanted to build a model, they could build it, but they don't want to.

[00:13:36] It's just not convenient.

[00:13:37] And let's just call it what it is.

[00:13:39] I heard somebody on a previous interview say, before value-based care, we need fee-for-service

[00:13:45] 2.0, which takes a combination of both models.

[00:13:49] Yeah, that's right.

[00:13:50] And then takes off.

[00:13:51] So I think with the machine you guys are building, Andy, and the infrastructure and the people,

[00:13:56] I feel like you guys are well-poised to take advantage of that.

[00:13:59] As sort of we get to the end of this podcast, it flies.

[00:14:02] What would you say is a call to action that you would leave our listeners with and our

[00:14:09] viewers?

[00:14:10] And where can they visit you and where could they learn more about Iris Telehealth?

[00:14:14] Yeah.

[00:14:14] So first, you know, fee-for-service, HEDIS measures, star ratings.

[00:14:20] NCQA does a great job of saying these things drive outcomes and we will measure them and pay

[00:14:25] money.

[00:14:26] So when you look at the star ratings for health plans in behavioral health, that is an evidence-based

[00:14:33] payment construct.

[00:14:35] And we don't want to acknowledge that on the provider side.

[00:14:38] We're on the provider side.

[00:14:39] We don't sell to payers.

[00:14:40] We work with every payer through our provider contracts, every payer in the country is about.

[00:14:45] But except the fact that the payment construct is tied to the current assessment of value for

[00:14:52] that unit of clinical measure.

[00:14:54] There are many other things around that that add value.

[00:14:57] Scheduling, follow-up, empathy, outreach, all these things add value.

[00:15:02] They can be massive disruptors.

[00:15:05] Focusing just on the unit of measure of the clinical encounter and I'm going to transform

[00:15:09] just the encounter, boy, that's really hard.

[00:15:11] I mean, you're talking about there might be 1% room there for improvement.

[00:15:15] All of it around there, 30% of all the patients in behavioral health no-show.

[00:15:20] Oh, is the number that high?

[00:15:22] 30%?

[00:15:22] Two times any other diagnoses.

[00:15:26] So if you want to move the needle, move it to the norm, revert to the mean, that unit

[00:15:32] of that impact would impact hundreds of thousands of people that need access.

[00:15:38] And they're not showing up for reasons.

[00:15:39] Like I don't have gas in my tank.

[00:15:42] I can't leave my job.

[00:15:43] So we're 100% virtual.

[00:15:45] We fill those gaps virtually.

[00:15:47] And I'm not telling this story because we do that.

[00:15:49] It's just a coincidence.

[00:15:50] But the scheduling empathy will get better with data to say they know where I work.

[00:15:57] They know how far I am away.

[00:15:59] Maybe they could put me with a clinician that is close to my work because I'm not going

[00:16:04] to drive across Houston to get there.

[00:16:06] That's just sort of simple reality.

[00:16:07] I'll do it on my day off, but I can't take a day off every day.

[00:16:10] I'll lose my job.

[00:16:11] So I would just say focus on the enabling activities.

[00:16:16] And if your mission is to be the best provider in the world, like ours is both, we have to

[00:16:20] do both of those things.

[00:16:21] But pick one.

[00:16:23] If you're starting out, pick one.

[00:16:25] Don't try and do both.

[00:16:26] Don't try and solve the whole thing.

[00:16:27] There's value everywhere.

[00:16:28] But I'm very excited about that.

[00:16:30] I'm on LinkedIn.

[00:16:31] I'm very active.

[00:16:32] I try and stay as present as I can in the community and social media.

[00:16:37] You know, I travel extensively with partners.

[00:16:39] And so I'm kind of sort of always running.

[00:16:41] But if you follow me on LinkedIn, it's the most reliable area to see what we're up to.

[00:16:46] Outstanding, Andy.

[00:16:47] Well, I appreciate your clarity of vision.

[00:16:50] You're very clean and clear value prop.

[00:16:53] You've left nothing to question here today.

[00:16:57] And that's a sign of a great leader is a great communicator.

[00:17:00] So folks, what a great opportunity to connect with Andy Flanagan, CEO of Iris Telehealth,

[00:17:07] mental health, behavioral health, substance abuse, IDD.

[00:17:10] All these things require attention.

[00:17:13] And the value-based perspective of a leader like Andy and his organization are really the

[00:17:18] types of provider businesses that are going to make a difference for us.

[00:17:22] So check him out in the show notes.

[00:17:24] I'll leave his LinkedIn, also the link to the website.

[00:17:27] You take action by moving on it.

[00:17:31] And that's how you improve outcomes too.

[00:17:32] So make sure you reach out to Andy.

[00:17:34] And Andy, such a pleasure to have you here on the podcast with us.

[00:17:37] Thanks for what you do, Saul.

[00:17:39] Very intriguing.

[00:17:40] Thanks.

[00:17:40] Appreciate you having me.

[00:17:41] My pleasure.

[00:17:42] Take care.