Introducing Satoshi Health Advisors

I'm excited to announce the launch of my own healthcare and bitcoin consulting practice, Satoshi Health Advisors! My mission is to advance the movement of healthcare onto a bitcoin standard. One approach I am taking is to empower healthcare providers to understand bitcoin and start accepting bitcoin payments. I am also working with healthcare startups and other local businesses that want to develop a bitcoin strategy and integrate bitcoin and Lightning Network payments into their operations.

Fiat Healthcare is Broken

I worked for over 7 years in the fiat healthcare system and learned a great deal about the brokenness of our current system. When I started strategy consulting for hospitals and health systems, I had the opportunity to see how centralizing forces within healthcare were impacting decisions for vertical integration and mergers across broad geographic areas. As I started navigating and understanding the complex web of players, I started to see how the industry was filled with "administrators" who handled the tasks outside of clinical responsibilities. One symptom of healthcare on a fiat standard has been the outrageous 3000%+ growth of administrators, while the number of physicians has stayed relatively flat.

It is no coincidence that we have seen such massive price increases in the healthcare industry, at over 200% over the past two decades. Part of the problem is the overregulation of the industry, policies and healthcare systems which I studied deeply throughout my double master's in health economics and policy program at the University of Chicago and London School of Economics. All of the technological advances in the industry have been overwhelmed by the administrative and legislative burden of the US system.

This has led to market failure, as the US spends $4.5 trillion annually on healthcare, with 25% being administrative costs, and half of that is waste. Many providers face upwards of 6-10% of each healthcare transaction going to the electronic medical record and billing system, with $60B spent in 2022 on transactions. Centralization across payers, providers, pharmaceutical companies and suppliers has led to squeezing out of independent providers. Any independent doctors practicing in the traditional fee for service model and having to deal with dozens of different insurance plans has led to need for more admin overhead, low margin practices, and significant challenges staying independent. There are many inefficiencies in billing and collections, dealing with prior authorizations and claims denials and banking and clearing house fees to deal with in the system.

Many of these issues has led to the rise of new care models going direct to consumer and bypassing insurance altogether. The Direct Primary Care movement encompasses independent providers or group of physicians or nurse practitioners that offer a monthly subscription for their medical services, operating OUTSIDE of the health insurance system. These are the kinds of innovative providers I have started working with and am seeking to continue to bring onto a bitcoin standard.

Healthcare on a Bitcoin Standard

 What can healthcare look like on a bitcoin standard? Bitcoin introduces scarcity back into our world that has seen runaway increases in the money supply.

Why Would Healthcare Providers Want to Accept Bitcoin Payments? 

Lower Transaction Fees

First and foremost, providers can improve their margins today and lower their transaction fees by accepting bitcoin and Lightning Network payments. Bitcoin has a dynamic fee schedule, and at this time it costs the equivalent of $1-2 for a bitcoin transaction. By utilizing the Lightning Network, a layer 2 on top of bitcoin, transactions settle at the speed of light and for near zero cost. There are no middlemen involved in transactions and providers now get the full value of each payment. There are variety of options to turn on bitcoin and Lightning payments, from custodial solutions to running your own node; a key part of my work with providers is helping them understand their options and picking the best tool to integrate with their workflow. Quick final settlement on bitcoin also means significant time savings from haggling with insurers over claims or prior authorizations, which can be a huge benefit for providers like dentists trying to move fully away from insurance.

Balance Sheet Strategy

Once you've started going down the bitcoin rabbit hole and answer the question "what is money", you'll realize that with its fixed 21 million bitcoin monetary policy and decentralized network of nodes validating the open ledger, bitcoin is the best money humans have ever discovered. Bitcoin has established itself as a strong store of value compared to the dollar, growing 150% in purchasing power annually. The growth of capital can power individual providers to invest in larger offices, expand their practice and make their cash flow a position of strength.

Over 2.2 million bitcoin are held in corporate treasuries, a number I expect to continue to grow as businesses realize the value of holding an asset that is liquid 24/7 and continues to appreciate in purchasing power over time. Cash flow positive businesses with this low time preference approach will gain market share and act from a position of strength, as those holding dollars see their savings diminish in purchasing power. As the price of bitcoin relative to the dollar continues to rise, businesses can skip the step of exchange and collect bitcoin directly for their services.

Marketing to Bitcoiners

As we move from the store of value to medium of exchange phase of bitcoin's progression as money, there is a growing cohort of bitcoiners that want to will spend their bitcoin. I subscribe to the pay me in bitcoin theory by Parker Lewis which says that bitcoin adoption will continue by merchants demanding payment in bitcoin for their valuable services. Bitcoiners will make the decision to part with their precious bitcoin only to support merchants that show similar values and accept bitcoin.

There are also tools like Strike that enable consumers to spend fiat and utilize the Lightning Network, and the merchant can decide if they want to receive fiat or bitcoin. This kind of optionality is key for enabling free choice for consumers, while also utilizing the fast and low cost Lightning rails. By accepting bitcoin, you send a message to the market on your values.

Aligning Values of Independent Practice

Running your own health and wellness service business takes high energy and dedicated practitioners. I believe that these valued professionals should not have to earn their money twice - once by providing a service, and again having to invest their money to avoid the perils of inflation. Turning on bitcoin payments aligns with independent practice values of medical sovereignty by combating the centralizing forces of fiat healthcare. Practices that accept bitcoin will find a consumer base ready to take personal responsibility for their health and support a decentralized model of care.

Transacting via bitcoin and the Lightning Network facilitates a Value for Value exchange that enables the provider to spend more time with the patient in a global healthcare system that has led to a decline of interaction time in many places as low as 5 minutes with the patient. Reestablishing the patient-physician relationship that has been lost in our hyper-efficiency fiat world will go a long way in restoring our health.

Low time preference

Our ability to think about and plan for the future is what sets us as a species apart from other animals. Health is the ultimate low time preference tradeoff. We are constantly in a struggle on cost/benefit tradeoffs now and into the future. Bitcoin pushes individuals to rethink their time horizon, lifestyle and spending habits, as it has gone up in value (compared to the dollar) 150% year over year for the past decade. We have basic needs that need to be met, and have the ability to work for our future self. However, fiat money has ruined our innate drive to save value for the future, because the money is broken via inflation and built in decrease of purchasing year over year. Our health is more important than purchasing power, as without our health we won’t be able to enjoy the fruits of our labor.

This underlying atmosphere has driven our healthcare system to massive costs and poor health outcomes, as we look for quick fixes for issues that have deep underlying root causes. The fee-for-service healthcare - "heads in beds" - has led to a "sick care" system rather than health. Healthcare providers that start integrating bitcoin today will be less reliant on a system that prioritizes sickness over health.

Proof of Work

Doing the work of staying healthy is hard! Especially when Americans have had to work extra hard to make up for the decline in purchasing power and fight environmental toxins day in and day out. Embedded in bitcoin is Proof of Work - a physical tie to energy that ensures you are interacting with the latest information and keeping participants honest. Proof of Work in health can be viewed as taking preventative measures to understand your key inputs - diet, lifestyle, sunlight - to fix deeper ailments, rather than solely turning to expensive medications. Provider that take then time to truly help their patients - and attract consumers that want to put in the work - will lead to the most fulfilling practice, and why practitioners got into the profession in the first place. The initials of Satoshi Health Advisors (SHA) is a nod to the Proof of Work algorithm in bitcoin, SHA256.

Free market economics

Setting your practice apart in today's hyper competitive healthcare market can be challenging. Moving towards a bitcoin standard shows your consumers that you care about freedom, sovereignty, and value their service. Providers embracing new models of care, such as Direct Primary Care or surgery centers providing price transparency help individual consumers better plan for the future and take steps to better their health today, rather than punt it for issues to pile up later. The Surgery Center of Oklahoma is a prime example of a healthcare provider that has had price transparency for years, providing cash prices, and even accepting bitcoin for a decade! They may have been ahead of their time, yet their innovative approach shows how healthcare business can be successful through transparent pricing and valuable, high quality service.

Censorship Resistance

Many providers have realized the tenuous relationship they have with their banks, as many were debanked because how they chose to practice medicine didn't align with the state. Bitcoin has the property of censorship resistance - meaning if you hold the keys to spend your bitcoin, you become your own bank and cannot get financially cancelled. As an independent practice, this value can become tantamount overnight, and getting set up sooner rather than later onto bitcoin will smoothen the transition for practices that may face future regulatory battles.

Target Markets I Aim to Serve

There are many healthcare providers operating outside insurance, including the aforementioned direct primary care, orthopedic clinics, dentists, telemedicine and mental health providers. More holistic modalities and alternative health practitioners like naturopaths, chiropractors, physical trainers, massage therapists and yoga teachers are all providing wellness services outside of the health insurance paradigm. I believe any practice that is seeking to strengthen its business and improve patient experience would benefit from adopting bitcoin.

There are also health tech companies and alternatives to health insurance like CrowdHealth that can benefit from integrating bitcoin and the Lightning Network into its strategy and core product offering. I helped CrowdHealth increase the bitcoin crowd membership to over 1,500 members and navigate bitcoin integration options last year. CrowdHealth ultimately decided to go with a more custom solution and innovative solution, turning the CrowdHealth app into a noncustodial Lightning Wallet by partnering with Breez. I believe other healthcare startups that are providing direct value to consumers outside of the insurance paradigm can benefit from starting to integrate a bitcoin strategy.

In future writeups, I will go deeper into how I enable healthcare providers to integrate bitcoin, and a case study of one of my provider clients. In the meantime, if you know any health professionals that you would love to start accepting bitcoin, please send them my way - jon@satoshihealth.com or book a discovery call. I look forward to connecting with you!

Thanks,

Jon