Jake Fackrell: AI Won't Fix Healthcare. But It Will Expose What's Broken

Welcome to Go to Market, a podcast for RevOps, sales, and marketing leaders to dive deep into industry insights and best practices. Go to Market is sponsored by Fulcast and Silicon Slopes. It is such a pleasure to introduce to you today Jake Fackrell, the COO of Savos Health. Jake, how are you?

I'm doing really good, Amy. Thanks for having me on.

Yes, thank you so much for joining us today. And it was wonderful chatting with you last week. And I, after just talking with you about like the wealth of information you have, the entrepreneurship chops you have, I'm So grateful that you're willing to come on the show today.

Well, I'm really glad to be here. Thanks for having me.

Thank you. All right. Well, let's start off for our listeners about what is your background? How did you get into what you're doing right now?

Oh my goodness. It's a long story, but I am an entrepreneur by, by trade, by birth, I guess, you know, always wanted to find a need and fill it and figure out how how to solve problems out there in the business space. And, you know, several years ago when I was just getting started, I had an opportunity to go create a business in the data aggregation space. There was some needs out there, especially in the real estate area where I was working and focusing, and created a company that we went out and we would go acquire all kinds of raw, unstructured, non-normalized data and information and structure it and normalize it, and we would augment it and enhance it. And we'd sell it to, to, like real estate professionals. And I had a conversation one day and they said, hey, that technology's pretty cool where you're going out and getting all that raw data. Can you, can that work for like obituaries? And I'm thinking, oh, probably, you know, you think about it as like somebody's gone out and typed out a 2,000-word description about grandma and, you know, we, there's all kinds of rich content in that obituary. And so we did it. We created a, you know, kind of a product for the family history space. And that turned into all kinds of opportunities. And so, it's fun being an entrepreneur and just recognizing opportunities. And I created a business and we had about 60 employees. And the thing that was very frustrating about that is, you know, trying to provide valuable benefits for your employees. And so, we, you know, it was, it was very, very difficult because your healthcare expenses and premiums would go up every year. And every year I was having these renewal meetings with my broker and we were always, the premiums were always going up by 20, 30%. And it was very frustrating. I was trying to give my employees a good benefit, but all I could do was give them increased, you know, just increased costs with, with their, their premiums and everything. And it was, it was frustrating. So I started talking to my broker and like, hey, this is crazy. Why are we, why does, you know, the these deductibles are going up every year, premiums are going up. What can we do about it? And he said to me, well, Jake, I've been actually thinking a lot about this. I hear this every day from business owners of this craziness of the healthcare world. This is back in 2016, by the way. And he's like, I know you're an entrepreneur and done some things with data. Like, let's go solve this problem. And I said, sure. So we did, we jumped in and that's how I got to where I am today. With Salus Health is we— I didn't have any background in healthcare. I just knew it was a very frustrating problem with increased costs every year for employers, for consumers. And not only that, but just the experience that people were having when you go in and you have a surgery or even a doctor's visit and you hand over an ID card, a health ID card, and that starts this process of claims adjudication and claims processing. And you don't know as a consumer what that's gonna end up costing you. Yeah, you might know you have a $3,000 deductible or a $9,000 deductible, but you don't know ultimately how many balance bills you're gonna get, surprise bills. The provider doesn't know when they're gonna get paid or how much they're gonna get paid. Payers are just trying to save money, health insurance plans, whatnot. And it's just a crazy clunky experience for everybody involved. And so me and my business partner, co-founder, decided to go solve this problem. And it's been quite the journey, but now we've created a fun, a great service, a great product that solves the main issues in healthcare, and that the cost and the transparency and just the overall experience.

Well, I think it's so interesting, and I love this story for so many reasons. Number one, You're a data guy and you came in and you're like, well, here's a real-world problem that I personally need to solve, so I'm going to use my background to solve this industry problem. And I think that healthcare is so big and this— we have created problems to solve other— we've created problems when we're trying to find solutions to solve other problems, right? It's just like this like humongous teetering Jenga that we've built, right? And so you've come in outside of the industry and you're like, all right, let me see how I can fix this for me and then for everyone else. And I think that is just a fascinating story.

That's when, yeah, I was the CEO of Domega and that grew into so many interesting things because we had that, we didn't know it at the time. It was for us, it was a family history file, but it was really a death record. That didn't exist. So we had companies like the Republican Party that would contact us and others going, hey, we need that death record file that you have. Because we had it in real time, we would get the information 2 or 3 days after somebody would pass, as opposed to the Social Security index that took months, if ever, for that to reach the population. So companies wanted to keep dead people from getting credit card offers in the mail.

Yeah, there are lots of practical reasons. Yeah.

Republican Party, obviously there was dead people voting, so he wanted to make sure that no dead people could vote. And anyway, it goes on and on, but we just saw a lot of different opportunities in that. And then that just grew into so many things. But as an entrepreneur, you always are looking for, okay, what, what else does this problem solve? What else does this solution solve in these other problems? And with, with healthcare, like you mentioned, we, we just noticed that there's a lot of competitors in the space trying to just create bells and whistles on an outdated, crazy existing process that didn't work, that was completely broken. And people were trying to fix it, but instead of going to the root cause, they were just trying to add little bells and whistles. And we thought, let's just reinvent the whole thing. Let's just recreate the entire healthcare experience, create a brand new payment rail that didn't exist before. And that's what we did. And now it's really, really turning heads. We were We are listed— Savvas Health was listed number 220 on the Inc. 5000 this last year. We're growing super fast. And it's all because we've reinvented how healthcare is transacted.

Oh, that's wonderful. Congratulations. That's really neat. So one of the things I wanted to get your opinion on as we kind of move into the hot take section is you have been basically taking unstructured data and making it structured so other systems can read it since 2005.

Mm-hmm.

We're just starting to talk about that now, that AI can do that, right? That AI can pull unstructured data and combine it. So my question is, how long has this technology been available? And, and is what we're now hearing about AI, like, oh my gosh, it can process unstructured data. This is incredible. Is it really that incredible? Is it different than what you've been doing?

Yeah, it's different than what we were doing. You know, back in the day, we didn't call it artificial intelligence, but it was the very beginnings of it. We would use things like regular expressions and Bayesian filters and just feed the system as much data as we could, and after a while it would get smarter and smarter and smarter. But we had to do a lot of handholding and a lot of just these regular expressions that would just pinpoint patterns and then be able to pull the data out of the patterns that we were able to identify. But what AI is doing today is if I had to rebuild it from the ground up, I would use a completely different system and structure to do that. And I think we could build it pretty quickly today as opposed to, you know, back then it took us, you know, millions of dollars and, you know, a long time. I think we've probably spent 2 or 3 years perfecting the algorithms and everything that we used for that.

And you could do those algorithms a lot faster now.

Through it today. In a day or two, you could have the whole thing built with what—

that's crazy. You go from 2 years to 2 days.

There's been tremendous advancements in AI in that field. It's, it's incredible what exists today.

I think that's really cool coming from you who did it all manually first. I think that's incredible. And, and I'm like, definitely, I'm, I am a huge optimist when it comes to AI, as long as we use it responsibly, right? And so hearing that case study from you is Absolutely crazy.

We've come so far. We, you know, in the early days, we would actually have people in their houses getting newspapers and typing out the ads and filtering it themselves. That was before we, you know, automated the process. So that's how far we've come from, you know, the early days of 2005 to today, from manually typing things in to just being able to completely automate the process.

Oh, that's really amazing. And it just kind of goes to show, like, you know, the steps that we took in order to be able to produce all of this, you know, like, first somebody had to create the computer, right? And the digital landscape. Then, you know, we put it all on the internet. Then we created systems to access all of the data. And now AI is analyzing it in a way that's never been done before. So It's really—

when you think about the advances we've made in just the past 5 years, can you imagine where we're going to be at in 5, 10, 15 years from now? 20 years? It's, it's going to be a whole different world. I'm really excited to, to see what we come up with in the next—

I am too. I, you know, I would watch Star Trek when I was a kid, and this was back in the 1980s, and they would do some of these things that I would like. The one that I thought would never happen was somebody's big face on their screen on a starship. I'm like, that could never happen. And it happens today. You know, that's crazy. So when I'm not—

think about the— oh, sorry, think about the Jetsons. You remember the cartoon, the Jetsons?

Yes, yes.

What they're doing, and it's like, hey, some of that is taking place right now.

So I know it, which really goes to show, like, if you can dream it, you can build it. In a lot of ways. What I'm not totally sure about is the beam me up, Scotty. I'm not totally sure we can like reassemble all of our atoms in the same way when they're— hopefully that— hopefully there are some limitations to technology. But yeah, it's been really fun to see. So when it comes to, um, date— like, how are you using advanced data now with Savos Health? Health? Can you just explain that process a little bit more?

Yeah, I mean, when we got our start, it was all about data. It was like, how do we get the pricing data into the system? And we came up with all kinds of crazy ways, 'cause you couldn't access it. There was no public or even private domains where we could access the data. So our first iteration of Savvos was we would have people take pictures of their bill that they would get in the mail and upload it to our, technology and then our technology would, would kind of decipher, okay, what is it? And, and then we'd load that up into a public domain and public space where our users could then see what things actually cost at what provider. And we'd had them redact private information or whatever. We didn't care, you know, names or anything like that. We just needed to know what is the procedure and where was it performed at and what was the cost. The problem was, is nobody knew back when we first started, like, what those costs were because you didn't know until you got your bill in the mail. Even the providers we work with, go in and ask, hey, what's this going to cost? They can't tell you. They can't tell you until they process a claim through a third-party network. It's insane. Like, why, why is that the case? And so since then, you know, we talk about data, we've kind of scrapped that whole thing and we've gone to a model of Let's just pay cash directly at the time of the procedure. When you can do that, you don't need to process a claim through a third-party network. Most, if not all, providers will take a cash payment at the time of the procedure. Why? Right now there's a, a half a trillion dollar a year industry from providers trying to collect their money from payers, from health insurance companies and whatnot. It's called revenue cycle management, and it's growing to be a half a trillion dollars a year. Well, what if you could just pay the provider at the time of the procedure so they don't have to try to collect their money? There's no collections, there's no revenue cycle management. We go in and say, hey provider, if we pay you at the time of the procedure, what's that shoulder surgery going to cost? What's that knee surgery going to cost? And they say, well, if you'll pay us at the time of the procedure, we'll roll out the red carpet for you. We'll give you 50, 60, 70, sometimes 80 or 90% off of their contracted rates. Huge savings. But then the key is, the trick is, well then, how can we make sure they get paid on time? And that's what Savile's platform does. It's a, it's a communication tool so all the parties can go in and they can talk to each other. They can figure out, okay, what's this going to cost? What are the actual CPD codes? They can— the doctors can say, hey, upload to— they're talking to the members— upload your MRI, upload your doctor's orders. And so all of the stakeholders are talking. It's kind of like Slack for healthcare before the surgery. So not this post-surgery claims adjudication that we're all used to, but it's all happening beforehand in a nice platform. Everybody's communicating together, figuring out what it's going to cost. Everybody agrees to the price before the surgery. And then we, as the payments platform and the fintech behind it, ensure that the provider gets paid on the day of the procedure. And we don't ask the patient to pay anything. In fact, because we're saving the self-funded employer groups so much money, they're offering their, their employees a zero-cost benefit, zero deductible, which is crazy because the reason why I started this in the first place is because I couldn't provide my employees with a valuable benefit. I, I was giving them a health insurance plan that was a $3,000 deductible. We, we just switched over a company not too long ago. They were giving their employees a $9,000 deductible. And they're, they're now with, with Savvis, and they're offering their employees zero out of pocket. Zero.

Because they're paying that much benefit. No savings. Working with the system.

Wow.

That is absolutely insane.

Their premiums are coming down as the employer, the self-funded employer group, and they're able to offer their employees a much, much better benefit than what they, they're previously used to. So that's the beauty of being able to pay at the time of the procedure.

That's so, so interesting. Let me ask you this though. What about catastrophic events? When there's a self-funded employer, I'm assuming that they are taking the risk on the catastrophic events as well. Is that true?

That's true, yeah. They take on all the risks. So what we've done is we're the plan manager. So we bring in all the pieces into this plan to reduce or eliminate that risk for the self-funded employers. So we bring in what we call stop loss, which is insurance. So let's say there's a catastrophic event, we can't, for whatever reason, get a great discount on the price and it goes over a certain amount, insurance will then kick in and cover that for the employer. Right now, to date, with all the procedures we've run, we've never had to go into a stop-loss situation.

Never?

Because of the cost savings. But if that does happen, we are protected. The employer is protected. They don't have to worry about it. The employer has to pay up to a certain amount. Out, and then stop loss will kick in and cover the rest. And so everybody benefits, everybody wins. It's a win-win-win situation. Think about the providers get paid on time exactly what they ask for. The, the, the payer or the self-funded employer group, they're saving all kinds of money on what the actual cost is. And then their, their employees or the patients have a zero out-of-pocket benefit. And better than everything, the savings is great, but the biggest compliment that we get from all the stakeholders is, guys, that was the best healthcare experience I've ever had. Think about it from the patient standpoint. They go in, they don't have to hand over an ID card and wait and see what happens 6 months, a year later. They walk out of that doctor's office or that surgery, they never have to worry about making a payment because it's all done through the platform. They don't have to worry about balance bills, EOBs, invoices, none of that's coming in. It's done. The procedure is done. They walk out and it's, It's already taken care of and the providers are paid 100% of what they ask for. So everybody loves what we're doing.

That's insane. So what happens then? Like, you know, obviously you've cut just a ton of costs out of this. You've improved the patient experience, you've improved the employer experience. Who doesn't win in this situation?

Just out of control hospital systems that are just gouging the public.

It's the hospital systems.

There are some hospital systems out there. You'd be flabbergasted at some of the costs that we've seen at some of these providers that are just out of control. And so we can go in there and we can direct our members or the patient to affordable, high-quality care. You don't have— we've been led to believe in this country that to get good healthcare, it has to bankrupt us. Over 500,000 families a year declare bankruptcy because of healthcare costs in this country. It doesn't have to be that way. And so we can go in and we can direct, and we also have been led to believe that unless it's super expensive and bankrupts us, it's not good quality. We found the contrary. We have really, really good, outstanding healthcare in this country that doesn't have to bankrupt us, that could be 50%, 60%, 70% off of contracted rates and save everybody a lot of money. So we can offer our patients excellent quality and excellent experience and, and zero out-of-pocket costs for them.

Wow, that is, that is insane. Well, Jake, clearly you are at the top of your game. You have solved a real problem, a very, very complex problem, and, and I just— that is so exciting. And I can't wait to talk with you later about how our employer plan can become part of Sattva Health. But my last My last question for you is, how do you stay at the top of your game? Clearly you are.

Well, it's been super busy. When I started Savvas Health with my business partner, Lou Moran, we both had great thriving companies. We could have sold those companies and, you know, and retired. And we decided that we wanted to solve and make a difference in this world, you know, for those 500,000 families that declare bankruptcy every year. What can we do to help these, you know, American citizens and these consumers? And so for me, it's been a grind. And my business partner and I talk all the time like, what do we do? Why did we do this to ourselves? We could have just, you know, been golfing every day or whatever. That's not in us. That's not in our DNA. We want to solve problems. And so one of the things we do now to just make sure we stay on top of our game is we, we do what we, we work on our business, not just in our business every day. And so we have sort of these rhythms, you know, every quarter, every year, we're, we're figuring out, okay, what is, what is our purpose at, at Savos? Like, what is our true purpose? And our purpose is cure healthcare, you know, and we're talking about that, that healthcare transactions. It's curious, fix it. It's like, let's make it better. But we also work on our mission, and our mission, um, is just to eliminate claims processing and claims adjudication. It's like a 3 to 5 year BHAG, big, hairy, audacious goal that we have. Like, let's try to get the whole industry on this new platform where we don't even have to send a claim through a third-party network. And then we just work on our core values and our culture of our business. And so we step aside from the business for a day or two and we just really focus on on the business and not just in the business every day. And sometimes we'll, we'll do things like get away. Like this last weekend, I, I was telling you earlier, I participated in a big mountain biking race down in southern Utah called True Grit. And it truly was true grit. It was, it was almost 50 miles, 4,500 feet of elevation gain in 90-degree weather. It was, it was really hard, but it was so nice to just be able to step away from the business for a day and just focus on something different, something else, and, and now come, come back in on Monday morning rejuvenated and ready to go and tackle the next problem.

I love it. Well, thank you for everything you're doing, Jake. Thank you so much for, for solving problems for all of us. I mean, think of the 500,000 families that you can help every single year and, and so many more. So thank you for everything you're doing, and it's such a pleasure to have you on today.

Thank you, Amy Cook. Thanks for having me. I appreciate it so much.

Business. Yes, that's business. Business. Yes, that's business.