Lee Lewis has spent his career learning how the pieces of employer healthcare fit together, and why most of them do not. His path started as the first employee at a property and casualty insurance startup, moved into a third-party administrator role in 2012 where he got a ground-level education in healthcare operations, then through three years of consulting before joining the Health Transformation Alliance (HTA), where he now works with some of the largest employers in the country. In conversation with Mehul Agarwal, Founder of HealthCompiler, Lee laid out a clear-eyed view of what is broken, where the real value lies, and what it will take for employers to stop managing healthcare on autopilot.
The Invisible Hand Is in Jail
Asked about the biggest structural failure in employer healthcare purchasing, Lee does not hesitate. The incentives have been corrupted, and the market has been paralyzed.
"There is no free market," he says. "There's no pricing or cost or quality indicators or awareness. The person who's paying for it is not the person who receives the good. So there's mass confusion over who the customer is."
That confusion has made it impossible for the market to behave like one. The result is unsustainable pricing and services that are not achieving their intended purpose. If there is a fix, Lee believes, it starts with the incentives.
He is pragmatic about the wave of cash-pay models and direct purchasing arrangements that have emerged in response. Many of the HTA's employers already have direct contracts with health systems. The growth of new providers offering cash-based rates or reference-based pricing is, in his view, a natural consequence of unaffordability.
"If we do the same thing, we're going to get the same results," he says. "That's just physics. So we must do something new. I don't know what new thing must be done. But the more unaffordable everything gets, the more everyone will be compelled to try something new."
The 10x Gap in Primary Care
When it comes to where the real return on investment lies, Lee points squarely at primary care.
Every other industrialized nation spends roughly half of what the United States does on total healthcare. Yet those same countries spend three to five times more on primary care. Indexed against their lower overall spend, that represents a tenfold magnitude difference in primary care investment compared to the U.S.
"I don't think that's a symptom. I think that's a cause," Lee says. "There's massive ROI to be found in a relationship of trust with an accessible, affordable primary care doctor. That is the most important thing we can do as employers and as a country."
Done well, he argues, strong primary care reduces the need for emergency rooms, hospitalizations, specialists, and the growing stack of digital health programs designed to manage conditions that a good doctor-patient relationship could prevent in the first place.
What Large Employers Keep Hearing
Among the jumbo employers Lee works with, the concerns are consistent. Cell and gene therapies are a growing worry at the top end. GLP-1 medications are a pressure point for everyone. Cancer and infusion therapies continue to climb. But underneath all of it, the common denominator is hospital pricing.
"We don't have a price crisis on podiatrist consultations," he says. "Where prices are absolutely soaring is in buildings. And we've got to keep people out of buildings."
All employers are overpaying relative to Medicare and Medicaid rates, Lee explains. Hospitals face constraints on what they can charge government programs, so the profit burden falls disproportionately on large self-funded employers, who end up subsidizing the gap.
The Path to Self-Funding
For employers still on fully insured plans, Lee's view is blunt. Any employer of sufficient size with even mildly competent broker support should make the switch. Staying fully insured past a certain threshold means losing money that does not need to be lost.
"If you're fully insured with 600 employees, you are absolutely getting murdered," he says. "You can save millions by switching to self-funded."
The harder work begins after the switch. Success depends on what an employer does with the control that self-funding provides: supplementing with advanced primary care and behavioral health, establishing centers of excellence, putting clinical programs in place for infusion therapies and cancer care, getting control over data, and designing plans that steer employees toward better outcomes.
The complexity can be overwhelming, and Lee acknowledges that many benefits leaders lack the organizational support to try new things. Contracting with individual primary care doctors across a dispersed workforce is impractical on its own. That is where conveners come in, organizations like Align Marketplace, Apaly, and Hint Health that aggregate primary care providers and simplify the contracting process.
Even then, engagement remains a challenge. Employers tend to start by identifying employees who are already sick and connecting them with better care. The bigger long-term opportunity, Lee believes, is getting healthy people to build a relationship with a doctor before they need one. That relationship does not bloom instantly. It takes time and repeated interaction, but once it takes root, the downstream effects are significant.
The Three Dogmas
Lee reserves his sharpest observations for the executive mindset that keeps employers stuck. He has identified three false beliefs that, in his experience, most business leaders hold, and that collectively prevent them from managing healthcare like a business.
The first is the assumption that healthcare costs are fixed. They are not. You cannot stop someone from getting cancer or having a skiing accident, but you can absolutely impact the cost profile, the accuracy, and the outcomes of the care they receive.
The second is the belief that saving money on healthcare hurts employees. Leaders may not say it outright, but they believe it. If costs are fixed, then the only ways to save are raising deductibles on families who cannot afford it, forcing people away from their doctors, or buying lower-quality care. No executive wants to attach their name to any of those. So they avoid the conversation entirely.
The third follows from the first two: the juice is never worth the squeeze. If costs are fixed and saving money hurts people, then why bother trying? Even leaders who take calculated risks in other parts of the business become paralyzed when it comes to benefits.
The result, Lee says, is that most benefits teams operate under two unspoken commandments: keep it quiet and keep us in the herd. Do not generate complaints. Do not do anything different from what everyone else is doing.
"Business leaders inadvertently create the thing that they don't want," he says. "They create a system that drives up a 10% cost trend and hurts their people. And they do that because they believe these false dogmas."
His prescription is direct. Leaders need to examine whether they hold one or more of these beliefs and act accordingly. Costs are manageable. Saving money, done right, is compassionate; it prevents families from being bankrupted by care they cannot afford. And bold action is not optional. Doing the same thing will produce the same results.
"You must do something different," he says. "And you need to take calculated risks with an educated benefits team."
His final recommendation: staff the benefits team with outsiders. Engineers, accountants, marketers, salespeople, people from other parts of the business who bring a different lens. Not having healthcare experience, in Lee's view, is often an advantage.