By Reid Zeising, Co-founder of GAIN Servicing
A while back I got a close look at a large, multi-location physical therapy company that was collecting roughly $250 million in receivables every year. At any given moment it was managing about 55,000 patients, and it ran that entire operation on a $4 million internal payroll built around call centers instead of technology. People picked up phones, made follow-up calls and logged the results in spreadsheets. The company was paying a premium for that labor, even though software can track every one of those calls faster and more accurately than a spreadsheet ever will. The lesson I took from it is simple: integrating technology into that kind of workflow raises productivity, brings in more revenue and cuts the cost of collecting it.
I keep coming back to that example because it captures something the healthcare industry still resists. Most of what slows down care and payment in this country sits in the administrative layer, and that layer is exactly where technology does its best work.
Every Person Needs an Agent
I get asked constantly whether AI is going to replace the people who work in revenue cycle, billing and claims. My answer is that AI will replace the people who refuse to learn it. The people who work alongside it will get more done than they ever could on their own.
I believe every person on a healthcare team needs an AI agent. If you work in this industry, you are already more technologically advanced than you probably give yourself credit for. You live inside EMRs. You work denials, manage rev cycle workflows and translate between payers, providers and patients all day. Those are the same skills it takes to direct an agent well. What matters is intelligent prompting: knowing what to ask for, what to check and where the output needs your judgment. Anyone willing to invest real time working with an agent gets significant leverage in return, and that leverage compounds for the people who start now.
The Wrong Scapegoat
Technology can take a lot of friction out of the system, but it cannot fix a problem the industry refuses to name. For years the insurance industry has lobbied on the idea that litigated claims and frivolous lawsuits drive up the cost of care. The numbers tell a different story. A 2019 analysis published in JAMA estimated that administrative complexity accounts for $265.6 billion in wasted spending every year, more than any other category of waste the researchers measured. The entire medical liability system, including defensive medicine, is a fraction of that.
The malpractice argument weakens further once you look at what happens in court. Physicians win the large majority of malpractice cases that go to trial. According to one review of jury verdicts, doctors win 80-90% of trials with weak evidence of negligence, about 70% of toss-up cases and roughly half of cases where the evidence of negligence is strong.
Much of the administrative waste in healthcare traces back to a cycle everyone in this industry knows well: deny, resubmit, deny, appeal. Everybody says no as many times as they can until the provider gives up or the patient does. I lived that cycle myself when my son’s ambulance claim was denied, and I see it at scale every day in the claims we service. It drains provider staff time, delays care and pushes patients into debt, which is the core of what I described in The Delay Economy. If we want to spend healthcare dollars better, let’s work on higher reimbursements for the providers doing the work and stop hiding behind the threat of litigated claims and medical malpractice.
If We Are Going to Talk About Single Payer
Single payer comes up whenever people get frustrated with this system, and I understand the appeal. I also believe capitalist systems are more effective. A single-payer model puts hard limits on resources, which disadvantages the people trying to use it and makes care outside the system unavailable to anyone who cannot afford to pay for it privately.
There is a better path. I have argued before that healthcare should function more like a utility. We decided long ago that water and electricity should be available to everyone at a reasonable cost, and the companies that provide them still earn a profit. In exchange, they operate inside a structure that holds them accountable for efficiency and reinvestment. If we are going to have a serious conversation about single payer, let’s have an equally serious conversation about treating health insurance as a utility. That framework would push insurers to cut administrative costs and put more of every premium dollar into actual care.
Fix the Pipeline Too
The same thinking applies to how we train the people who deliver care. Medical school costs push new doctors into years of debt before they treat a single patient, and that debt shapes where they practice and which specialties they choose. AI gives us a real opportunity to improve coursework, consolidate material and shorten programs without lowering the bar for competence. Reducing the cost of becoming a doctor would do more for access than another round of tort reform.
Where the Real Savings Are
The physical therapy company I started with had capable people on the phones, and its upside was always going to come from putting better tools in their hands. Healthcare as a whole is in the same position. The people are already here and already skilled. Give them agents, break the deny-and-appeal loop and hold insurers to the standard we hold every other essential service, and the savings follow.