Episode Transcript
[00:00:00] Speaker A: And welcome to the 319th episode of objectively speaking. I'm Jag, CEO of the Atlas Society, and I'm actually joining you from Porto, Portugal, where we are hosting our European student conference, our new intellectuals conference here in Porto. And we're on our second day. We have another full day tomorrow. So hopefully, hopefully some of you will come and join us at those conferences, either in the US or in Europe.
I am very, very excited to have a returning guest, Anson Frerich, join us to talk about Radley Care, the AI enabled mental health startup that he co founded with a mission to empower adults living with serious mental illness to live amazing lives. So, Anson, thank you for joining us.
[00:00:58] Speaker B: Thanks for having me, Jack. Thanks for, for letting me return to the show and looking forward to a great discussion today.
[00:01:03] Speaker A: So you've had a pretty unusual career path, co founding. Well, first Anheuser Busch and then of course, writing about that in your, your
[00:01:20] Speaker B: kind of memoir, Bud Light there. That's right.
[00:01:22] Speaker A: Last call for Bud Light co founding Strive Asset Management. And now to serious mental health care. What brought you personally to this problem and why did you decide that this was the next thing that you wanted to build?
[00:01:38] Speaker B: Yeah, definitely. Great, great question. My last companies, you might recall, Strive, we had a mission, really, to lead companies to focus back to excellence. We were pushing against the stakeholder capitalism movement that was asking every single publicly traded company to get involved in social and political issues in the US you go back five years, you had companies like Coca Cola getting involved in voting rights issues. You had companies like Salesforce trying to defund the police. You, of course, had Anheuser Busch and Bud Light pushing Dylan Mulvaney and a really radical LGBTQ agenda across corporate America. Strive was created to get that agenda out of, out of corporate America. We said companies should focus on their mission, be dedicated to that mission. That's what's most important. That was what was good for shareholders, shareholder value and ultimately shareholder capitalism. And there's been no greater force for just continued human improvement and human flourishing in American capitalism. So we did that with Strive. Strive is now a publicly traded company. And when I was thinking about what I want to do as my next endeavor, I think God sometimes has a funny way of having a sense of humor and said, okay, you just spent a bunch of time saying that companies should stick to their mission, be dedicated to solving one issue. They shouldn't get involved in every single social and political issue that comes their way. Well, I've got a big one for you. And we're in the midst of this national mental health crisis in this country. And then I have a real personal story where one of my immediate family members was diagnosed with schizophrenia 20 years ago. And our family, we've seen the ups and downs of navigating the behavioral health space. We've seen a lot of problems and a lot of gaps in the system connecting people to care. And there were some changes from a regulatory standpoint in the state of Ohio, which is where I live, that kind of brought this issue to light to myself. And so this was all kind of put in front of me. I said, you know what? Well let's go try and solve the next real crisis. My last company strive, we sort of solved what might be the called the woke mind virus crisis of trying to stamp out in corporate America a lot of social and political issues. Well, here's a real mind virus issue with serious and persistent mental illness. People with schizophrenia, bipolar, deep anxiety trauma, depression. So why don't you sort of take your efforts and see if you can do a better job of undertaking that problem. And here we are.
[00:03:53] Speaker A: You mentioned the disorders that you are focused on at Radley and as well substance abuse and co occurring disorders. Why did you decide to focus on those specific disorders rather than the much broader mental health market?
[00:04:11] Speaker B: Definitely I think to some degree there's almost been a little bit of scope creep within mental health and mental health these days. Almost everybody struggles to define what actually is a mental health challenge. It was striking to me that Gen Z For example, they 50% of them identify as having some sort of a mental health issue. And I think we need to do a better job in this country of being able to differentiate what is a real mental health issue from a feel mental health issue. And there's a lot of people, especially younger people that they conflate the two of what's a serious and persistent mental illness which is real versus what is I just feeling. And so on the feeling side a lot of Gen Z specifically has said wow, I'm nervous about this test that I have coming up and therefore I must have anxiety. And they go on TikTok and they diagnose themselves with anxiety. And that's not being anxiety is a normal human reaction, it's not having mental illness. It's just yeah, you have a test coming up, you got to study for it. If you study for it and do well on that, you'll do well on that test that anxiety goes away. Or some other people that are saying my favorite team lost this weekend, I'm feeling down, I must be Depressed and they diagnose themselves with depression. And then a lot of those call it the feel illnesses. They can become self fulfilling prophecies. People then just self diagnose themselves and that's sort of a feel mental health crisis. There's too many people that I think are trying to address the feel mental health. Tons of startups are going direct to people and saying we'll give you therapy or we'll log on or here's a chatbot you can speak with and talk to. And I think a lot of those issues can frankly just be solved by having deeper relationships with faith, with freedoms and the appreciation for the country, family connections, having good physical health and then also having a little bit of fun that's on the field side. And then what we're really focused on is the real mental health. And what I call that is that serious and persistent mental illness. That's the 1 in 20 people in the United States that are diagnosed with diseases like schizophrenia, bipolar, real deep trauma.
And there's another list that we have. But those are sort of the bigger problems that those regardless of a test you have coming up or how your favorite sports team does over the weekend, it can lead to hallucinations, it can lead to behavioral health issues. And so that's really what we're focused on. I think that's one of the most intractable problems where there aren't enough entrepreneurs going in to try and work with this patient population and trying to improve the health outcomes and then also decrease the system cost as these are very high cost patients for insurance companies and, and then also for our broader sort of societal governments, prisons, et cetera, for them to work with.
[00:06:51] Speaker A: So walk us through what exactly RadleyCare does. Let's say somebody gets discharged from a psychiatric hospital and then has a program or an account with Radley care.
What is that experience going to look like and feel like as opposed to somebody really not having access to, to those resources?
[00:07:14] Speaker B: Definitely. I mean this was a surprising stat to myself. But the problem that we're trying to solve is 50% of individuals that end up in an inpatient behavioral health facility or they're in an emergency room with having some sort of a psychotic break or episode, they get discharged and they don't connect to ongoing care. So 50% of people, they don't go and get their medication that they need, they don't get connected to therapy, they don't, they don't get connected into social services that they might need. They don't follow up with primary care doctors to get help. And those 50% of people, they end up right back in the emergency room 30, 60, 90 days later. And to put this into context, if you have an underlying serious mental health condition, you're two times higher to have likelihood of risk of things like chronic heart disease, you're at much higher risk for hypertension, you're, you're at a 35% higher risk in the general population for co occurring substance use disorder, you have a 25% higher risk of having run ins with police, you're more likely to be unemployed. These are just sort of things that happen when you don't get connected into that care. And so the problem we're trying to solve is we connect people into care. So once we receive a patient referral from an emergency room or from a behavioral health facility, we at Radley, then we take full accountability for that patient to help them navigate to those ongoing services. And ultimately what we're trying to do is make sure that people are getting healthier. And then since they're getting healthier, they should not cost as much to sort of the hospital system because they're not going to the er. And then also for broader societal issues, we're trying to keep people out of jail, so trying to drive down recidivism rates, we're trying to make sure that people, that they're getting access to jobs and that they are more stable so they can work. And we think that that alleviates a broader burden on society as well.
[00:09:04] Speaker A: So peer support is central to your model. What can someone who has personally experienced mental illness or addiction sometimes offer that even a very good psychiatrist or therapist could not?
[00:09:17] Speaker B: Definitely. So a lot of times your doctor psychiatrist, they can diagnose the issue or the problem that you have.
What they cannot do is say, I've been there, I've lived this. And this is what you actually need to do to make sure that you're going to get healthy. And so what our peers do, they're all licensed professionals. So here in the state of Ohio and then in the 40 states that we plan to go to over the next couple of years, peers are either generally licensed or certified. And so what that means here in Ohio is that people that they have to be first, have lived, experience, they've been diagnosed, they've been in recovery from their own mental health or substance use disorder, they have to get 40 hours of in person training, 16 hours of online training, and then 30 hours of continuing education units every single year.
And really what that does is that makes sure that when we connect a peer With a patient, this is someone that can really build trust that a lot of times a doctor or maybe even a family member cannot. Because these are people that have been in the shoes of the person just entering recovery. They're the ones that can understand what are the steps that need to be taken to try to achieve really fulfilling and an amazing life is that we say. And that might look different for everybody. But there are some key buildings, building blocks, that starts with adhering to medication management, getting your basic social determinants of health met, and then connecting generally into ongoing therapy and support with other individuals. And if you put those building blocks together, that leads to a much greater probability and likelihood of success. And those are something that peers are uniquely qualified to do, that a lot of other medical professionals or social workers might not be able to do.
[00:10:54] Speaker A: Where does the artificial intelligence component come in?
[00:10:58] Speaker B: Definitely I say that our business model could not have been possible before AI. The reason that is since we partner directly with hospitals, emergency rooms, behavioral health organizations, they're the ones that initially intake people with serious and persistent mental illness. They do the diagnostic work, they do the assessment work, and they put together a treatment plan that says, once you leave this hospital or this doctor's office, here are the things that you need to do. And in a lot of cases, people, they might end up in an emergency room or behavioral health organization institution for one, two, three days. But then when they get discharged, well, there's another 10,000 minutes in a month that they need to be working on sort of their ongoing care. And so what we are doing is we take all of that complex medical information, the treatment plans, the medication plans, the ongoing sort of support that's needed. We run that through an AI tool that extracts all of that information, information that otherwise very high cost, high paying doctors would have had to have done. And then we can transcribe that into an individual patient plan that our peers then go out and execute. So it would just been too costly before AI to extract, synthesize, and then put into place an individual plan for our peers to work with, patients to execute. And then also on the back end, we then have a software system that connects, we call it kind of the golden thread that pulls through the interventions and activities that are specific, specifically going to accelerate a patient's recovery plan based off that diagnostic work. And then our peers and patients, they meet, they get together in person, and then we utilize AI as well to help our peers write progress notes that are directly related back to those, the, the interventions and activities that they were supposed to do and their treatment plans. None of this would have been possible for AI. And now we have a very seamless program plan that takes the patients their needs, gives our peers intervention activities to do, and then allows them to write clinical quality notes that we can then submit back to providers and doctors about what exactly we did, what's the progress of this patient, and then if additional help or interventions or medications are necessary. None of that could have been really done in a frictionless way before AI, and it would have been too expensive for almost any business model to be able to put in place.
[00:13:15] Speaker A: So in a moment we're going to turn to audience questions. But I'm someone who's always been interested in how businesses are started, how they are built, how they function, entrepreneurship and really the whole startup culture. About a year ago, Radley Health received its first patient referral and made its first connection with a Radley care peer. A year later, I understand the company passed the milestone of facilities facilitating 200 peer and patient connections in a single month. So how has the business scaled?
[00:13:55] Speaker B: So the business has scaled. It's been great. We've actually put kind of a two sided model in place. On one side, we built this peer support network that now is over 550 individuals in the state of Ohio, plus we have 100 people in the state of Georgia as well, which is the next state that we're launching in. And then on the other side of that, we've developed relationships with a lot of hospitals, with a lot of community mental health centers, with a lot of emergency rooms that refer patients to us. So we have this two sided model. We're now on one side, we're having a lot of cases, hundreds of patients that are now being referred to us on a monthly basis. And then on the other side of that, we're now connecting those patients with all these Radley peers to connect and facilitate hundreds of different interactions. So every single month it's a lot of fun to see. The number of patients that we're being referred to goes up, the number of connections that we're making is going up. And then of course as well, that means that our revenue is going up and our billings are going up. And then from our investor standpoint, they like seeing that growth. And I think that we're just starting to hit a really interesting inflection point. And then there's an opportunity, I think at some point, partner with thousands of individuals across the country and provide the care that they need to really, again, close those outpatient care gaps. That's where we're starting and then even longer term as well. We're in discussions with multiple different insurance plans that the patients that we work on, they in a lot of cases cost insurance companies $100,000 a year. They might only be getting $50,000 in premium. And so we always said there's an opportunity of almost $50,000 per patient to be able to lower those costs down and to be able to improve their lives. And we're working with a lot of innovative models to be able to do that as well. And that's, I think, longer term where we head, to be able to provide economic value and to be able to continue to scale our business beyond what we're doing now with the hundreds of patients that we're seeing on a monthly basis.
[00:15:49] Speaker A: Exciting. All right. A lot of people, including Kingfisher, saying it's way too early there in Alaska. He just had his second cup of coffee. But hey, between the conference and where I am, we had to find a compromise that would work. So Lock Stock Barrel asks, what do you think about people who use AI like ChatGPT to self diagnose? What about people who use these LLMs as kind of virtual therapists, if you will?
[00:16:19] Speaker B: Yeah, you know, in terms of trying to get additional information, I think more information is always good for people. So I mean, I myself, if I have, you know, if I'm feeling sick or if I'm not feeling great, I now turned a lot of times to Chat GPT to help me diagnose an issue of having my wife recently, she was having a lot of issues and pains and put it into ChatGPT and she got a diagnosis, took to the doctors and the doctors actually confirmed probably what she had and had a pretty interesting treatment plan. I don't necessarily mind people utilizing AI to help self diagnose what they are. The issue that I think I have specifically with AI, particularly with people with serious and persistent mental illness illnesses, LLM in a model, they're not going to know if somebody is actually having a psychotic episode and is having a psychotic break. And they're speaking with somebody who is not in the right mental mind frame. And therefore with a lot of the LLMs, they're set up to give rational and logical responses to people that are putting in rational and logical inputs. And that's where you're seeing a lot of mismatches right now, where you're having chatgpt and Anthropic and others are being sued by multiple individuals who were in the psychotic episodes. They were asking for information about how People might be able to harm themselves or harm others and they're getting that information back. And I think that's the real problem that we're seeing is when people are not in the right state of mind getting information and being almost to some degree egged on by ChatGPT to make bad decisions or harm themselves or to harm others. And I really think where we need people not necessarily to turn to LLMs and other models when they're in the state of psychosis, but to have an individual and a person that can recognize when someone's in crisis and there's a problem and you need to get somebody to an ER or you need to get someone to a doctor.
I almost think about it the same way that we need to utilize peers more, sort of co pilots or pilots. Think about right now, most airplanes could theoretically fly themselves and when the weather's good and there's no turbulence, that's fine. But when you need pilots, when there's a problem or there's an issue, everyone probably remembers when Captain Sully, who was the pilot who was able to land the plane to the Hudson river after birds flew into its engine. That's where you really need sort of the co pilots and that's where you really need the peers. When people are struggling in a bad spot and be able to recognize that someone's in crisis and needs help, which I just don't think any LLM or the other models are really going to be able to understand.
[00:18:50] Speaker A: You've been using the terms psychosis, psychotic episodes, psychotic break, maybe break that down for us. What are we talking about?
[00:18:59] Speaker B: What we're talking about? This goes back to serious and the persistent mental illness. So people that have bipolar, schizophrenia psychosis, and this really is in terms of their brain and a lot of times it's dopamine levels in their brains being overreactive and people that are not able to make rational decisions. I think if you go back and you take a look at really psychosis and people having psychotic episodes, it goes back to ancient Greek times where this has been recorded. If you take a look at the Bible, you had Jesus to a large degree who was talking about exercising demons, a lot of those demons or people that may be experiencing psychosis, schizophrenia, etc. There's still, we're very at the early stages.
Even with all the breakthroughs in AI and medicine and others, and still understanding the brain and understanding what causes psychotic episodes and psychotic breaks, there's a lot of evidence that shows that there are certain people that are more predisposed to having psychotic episodes. And they can be triggered by certain health issues or by traumatic issues that people have. And then unfortunately for people that are diagnosed with serious and persistent mental illness, it tends to happen between the ages of 18 to 25. So I say this tends to be a young person's disease. It does not discriminate based off race, sex, relationships, religion, background. It tends to hit about 2 to 5% of the population and it tends to be lifelong and degenerative, especially if you don't get help. The thing is that we've been, I think, very fortunate in my family and other families that we have worked with over the years to show that you can get people not only stabilized, I mean, stabilized should be baseline. But if you get people on medication and therapy and get them into and to help that, you can actually help people live amazing lives, which is getting people to have jobs and being able to have, have marriages and be able to have kids and be able to go on and do the things that, that people without serious and persistent mental illness would want. That's our goal and that's our dream. Whereas if you don't get that help, you don't get that care, then you end up with the people that are on the streets that are causing a lot of issues in terms of crime or causing other sort of social problems that we have. That's what we're trying to prevent. That's what we don't want to have. We don't want to have people ending up in jails and long term hospital stays because they could have prevented this with the right care plan.
[00:21:22] Speaker A: What happens when the person with serious mental illness doesn't believe that he or she has an illness, doesn't want treatment and stops taking medication, or simply refuses to engage? Can AI or this peer support network help on that level?
[00:21:41] Speaker B: Those are the hardest patients that we really work with and we deal with. And I think from a transparency standpoint, the people that don't want to engage, they don't want help. Those are ones that we really struggle to reach. And I think that any technology platform is going to struggle to reach them as well. Because this patient population tends to be skeptical of technology. They don't like to engage with technology.
A lot of times this leads into a lot of the fears and the paranoia that somebody is tracking them or listening to them.
People ask me a lot if Elon Musk Optimus Robotics could help this patient population. And I say that's going to make their problems worse because that is the fears of the AI army And the Terminator that's going to be coming in Skynet and Skybot, all those fears come into reality.
So I don't know if technology is going to be the one that reaches people. I think what it is and where we see the most success is when people, they do tend to hit some sort of a rock bottom at some point.
And they do end up in hospitals, unfortunately. Sometimes they end up in jails. But that's the point where you need to start rebuilding. You need to bring in peers at that point. You need to have people with real stories about how they were once homeless or how they were once incarcerated or they once had problems and what do they do to get out of it. And it starts in a lot of times with some sort of medication plan. It starts with a therapy plan. It starts reconnecting with family members and loved ones and other people that can provide support.
And that's a real difficult road for a lot of people, but that's sort of the road that people got to take that first step on. And that's what our peers are able to do to try and reconnect with those individuals that have been somewhat lost in the system.
[00:23:29] Speaker A: Well, we all know about the privacy concerns with medical records.
Are there any. Is there a risk of privacy breaches with the AI reading medical records or even, you know, given these are so consequential? Possible risk of AI hallucination or mistakes?
[00:23:50] Speaker B: Yeah, I mean, unfortunately, I think that every single day we see that there's some sort of a data breach or there's some sort of a risk that some company didn't take the right precautions and didn't protect consumer data. Every day that happens. I think that we at Radley, the baseline standards, every single partner we use, we use their HIPAA compliant software. HIPAA is the program that makes sure that your individual medical records are protected. So, so we use the HIPAA compliant Amazon versions. We use our HIPAA compliant email, HIPAA compliant HubSpot CRM systems. That's at a baseline. On top of that, we have chosen to be SOC2 and then Hitrust certified. So those are two independent organizations that essentially go and they stress test your systems that you have built and do they pass compliance to make sure that people cannot access your medical records. So we've done that on our own. We also sign agreements with all of our partners to make sure that they are protecting our patient information and patient data.
That said, could AI at some point create a bot that comes in and tricks systems? I'm sure that's only a matter of time for certain companies. Hopefully we're not the company that happens because we've taken the right standards. We've gone above and beyond what needs to happen.
And then to your second question about AI hallucinations and utilizing AI with to be able to extract patient records and information internally and then kind of put together a plan for patients. One of the fail safes that we put in place is we always have at the before a plan is released to a peer to connect with patients, we do have a human touchpoint where we have licensed independent social workers that they review those plans at the end that have been created just to make sure that there's not a hallucination and that there's not recommendations that are being made that don't make sense. And we have some pretty good guardrails in place. We utilize a clinical model called the daily living activities 20, which sort of scores people in 20 different daily living activities. Do people have housing? Do they have food? Do they have a job or they have access to medicine? There's 20 different things like that that every adult human just needs to be able to navigate. We score them from 1 to 20, 1 being low, sorry, 1 to 7. 1 being low, 7 being high. And so we have some guardrails in place about what are the interventions and activities our peers do and how they do them. But we still have humans check and make sure that these are the right things that are happening for the individuals that are that are in recovery.
[00:26:18] Speaker A: How are you measuring success? You talked about keeping people out of emergency rooms and jail cells and reducing repeated hospitalizations. How do you manage, how do you measure whether Radley is changing those outcomes?
[00:26:34] Speaker B: Yeah, I mean, there's just two key things, very simple. One, are we lowering the total cost of care to care for these individuals? And then two, are these people getting qualitatively and quantitatively healthier and better? So on the first front in terms of lowering costs, one of our investors is CareSource, which is the largest Medicaid insurance company in the state of Ohio, one of the largest ones in the Midwest. We're going to Georgia next. It's one of their markets. They can give us patient level information that shows before a Radley care peer intervened and is doing the ongoing navigation. What were the costs of these people? How many times are they showing up in the er? How many times are they showing up for other specialty visits and what was the cost?
And we just got back information this past week from Caresource showing that once we intervene and after six months. We have definitively driven down by 20% the number of times that people are utilizing ERs and utilizing outpatient care. And we've therefore driven down the cost by about 20% of these individuals. And these are large numbers when a lot of these patients cost on average almost $100,000 a year in medical cost and fees and behavioral health stays. So to reduce that by 20%, and these Medicaid is of course paid for by taxpayers, this lowers the overall tax burden.
So on one side we're seeing those costs going down, and then most importantly, on the other side, we're seeing quality of life improve for people. I mentioned earlier that we have this clinical scale called the daily living activities 20 index. It scores people from 1 being low to 7 being high. And we can see qualitatively that on all of the individual activities that we work on that month after month after month, on average from month one to month six, that we're seeing people make score jumps of two or three. They might come in at a two and they end up at a five, or they might come in at a four and they end up at a seven.
And so we're seeing qualitatively, people get better. And then we also score some of our peer and patient integration or connections, just like Uber. So in the same way that Uber has a five star rating, we have sort of the five star ratings. And all of our peers generally get five stars or very high fours, with the exceptions they miss a, an appointment here or there. So we have like a 4.98 average rating with peers and patients. And so that's how we're kind of measuring that success. Costs are going down, patients lives are improving. And I think that's a winning formula for not only our company, but for the country at large.
[00:29:03] Speaker A: So you started in Ohio, you said you're going to Georgia next. I'm wondering what you're looking at when you make the decisions that we want to expand here or there. Next.
Are there very large differences in the regulatory frameworks in these states and is that a very big factor?
[00:29:22] Speaker B: I think one of the amazing things about this country is that you have 50 states and therefore you have 50 different models for healthcare. Every state does Medicaid, Medicare regulations, licenses differently. I think it's one of the interesting things about our country. Of course it's, would it be nice if there was one program, one system across the country?
In a lot of cases that would make things easy. But also therefore, I think that it would prevent sort of the innovation and these Innovative hubs and sharing best practices and the best way to do things. So we choose really which states we go to based on three different factors.
The first one being we need to be able to have a business model that makes sense and is sustainable. So do the reimbursement rates or the contracts we can have with payers to drive down cost and, and do shared savings. Can we make it just financially work in Georgia? We can definitely do that. Secondarily, we take a look at, is there a good peer landscape that's in place? So do they already have a way to license peers, certify peers? Are there a number of peers that we can work with and contract with to really be. What I say is sort of our army that is meeting with people in their houses, in libraries and coffee shops and finding those individuals.
And then third piece as well is, is there really a willing provider network of doctors and behavioral health organizations, federally qualified health centers that want to work with us. And so Georgia kind of met all three of those characteristics. I also happen to live there for four years, so just makes it easier to go down there.
And it's care sources, number two market. So there's a lot of willingness for us to be there. But then after that, we're already taking a look at Arizona, Oregon, California, Arkansas, Illinois, Massachusetts. We have a whole pipeline of states we'd like to work in. And then there's a whole other list of states as well that if insurance companies want to partner with us and we can take really full risk and full responsibility for their patients that cost $100,000 a year. And then our goal is going to drive down those costs and then improve those patient lives. We think we can take this, this model to every single state, but we have a pretty good roadmap of states that we believe will be very good partners for us.
[00:31:35] Speaker A: All right, we may have already covered this in part, but King Fisher is asking, why does the handoff break down so often when patients leave behavioral health facilities and never successfully connect with follow up treatment?
[00:31:51] Speaker B: The biggest piece is fragmentation and lack of accountability.
So when somebody leaves a inpatient behavioral health group or an emergency room, the services that they need for follow up care are all fragmented. Where do I go if I need medication? Where do I need my primary care doctor? What if I need specialty care? What if I need housing? What if I need food? All those are different organizations. And so that's very fragmented. And then secondarily, nobody takes accountability. And I think the incentives are completely misaligned within the healthcare system because all of the different, the primary care provider, your specialty provider, your behavioral health organization, all of those organizations, their business model is currently built on what's known as a fee for service business model. So if I go to my primary care doctor, they're going to bill a fee for that service. If I go to a therapist, behavioral health, they're going to bill a fee for that service. If I go to a specialty doctor because I need to get foot care or skin care, that's a different fee.
Everyone's taking their individual fees, but nobody's taking responsibility. Is am I getting healthier in general? And we're trying to flip that model where what we're saying is one, we want to be accountable to make sure that that patient is navigating those resources that they need and they have access to all of them. And, and especially if you're not in the right mindset from a framework standpoint, you're not going to be able to navigate any of those if you don't get sort of your basic social determinants of health met. And then you're not going to be able to work in the other ones. And then secondarily on the fee for service piece, since everyone says billing, billing, billing, billing, billing, and not being accountable to that health, we want to be that organization that actually is accountable for their total cost of care. So that's why I mentioned a lot of times we're evolving our business model and looking to partner with people and take accountability for people that are literally costing $100,000 a year to insurance companies and saying we will take that $100,000 worth of premium and then we will be accountable and responsible for that individual to make sure that they're getting that follow up care. And we're already seeing that we can take those costs from $100,000 to $80,000. So therefore that we can drive those costs down, we share in some of those savings, which helps covers our cost, and then we share those with some of our partners as well. And then ultimately everybody benefits. But right now, again, it's lack of accountability and it's fragmentation in the market. And those are the two problems that we're solving at Radley.
[00:34:19] Speaker A: Well, you say that everybody benefits, but I was just thinking about the example of how trial lawyers are among the groups lobbying against Waymos and these driverless cars because it's leading to fewer accidents and leading to fewer opportunities for trial lawyers to pick up customers and sue. So I can see that the patients themselves are benefiting, the taxpayers are benefiting, the insurance Companies are benefiting, your company will benefit. But who stands to lose if your model works and scales?
[00:34:59] Speaker B: I think the people that stand to lose is you're going to see a lot of secondary and third tier type providers, somebody that might currently utilize. I think that those will consolidate.
Right now, I think in the state of Ohio you have something like, I don't know, 150, 180 community behavioral health centers. That's too fragmented. And I think some of those will end up probably consolidating because they are seeing people, but they're not really accountable for their outcomes. And I think if people start to keep saying that healthcare costs are going up 10, 20, 30% a year, we're spending $300 billion here on mental health, People are getting worse, not better. Why are we spending all this money? And people are going to really start asking those questions. So if we start actually taking accountability for people and driving those costs down, I think you're going to see people that are the secondary and tertiary type providers that aren't really the leaders in their market that will end up going away because their services are no longer needed or no longer necessary. I really like your trial lawyer piece. I have no doubt the trial lawyers, they will reinvent themselves and they will find somebody else to try and sue. But I mean we really think that our proposition is win, win, win. I mean we see very little pushback when we go to hospital systems and we drive down, the people show up in the er, which they don't run the er, we win because we get people actually their primary care doctors and FQ8 and then we win with the insurance companies because their costs are going down. This to me just makes tons of sense and the incentives are all aligned.
We need to be better aligning incentives within health care. And then so some of those people that just live off of this fee for service model and frankly the people that are doing some of the Medicaid fraud, those people go away as well because a lot of people are just billing for things that aren't necessary. But it's a lot of we're trying to eliminate the fraud, waste and abuse and like the secondary and tertiary folks that really aren't delivering good outcomes.
[00:36:52] Speaker A: Along the same lines, my modern Gault is asking whether there's been any pushback from more traditional medical professionals when it comes to the peer to peer support aspect.
[00:37:03] Speaker B: So we're very transparent in that our people, we say these are not clinical people, we're non clinical people. But we believe by partnering with clinicians we can deliver much better clinical outcomes. And I don't think we've gotten as much pushback because we're not doing our own medication plans. We're not doing our really our own treatment plans. What we're saying is we have this like a one team, one dream approach where we're partnering with doctors and we say, these are getting your assessments, your diagnosis. We're not messing with that. We're not doing different treatments. We're not telling people different things. But the problem that you have is you can see a patient 20 minutes a month, but again, the other 10,000 minutes a month are the people actually following and adhering to the treatment plan that you want.
That's what we are actually implementing and putting in place. And I've been amazed that nobody really in healthcare follows back up with doctors and sends back notes and progress notes and saying, hey, we were supposed to get this person to a primary care doctor. We were supposed to get them to their dental visit. They needed specialty care for an ongoing diabetes issue, and they had an issue with searching for job. We've now done all of these things. And so next time that patient comes back to their primary care doctor next month, they now have a full record. And doctor says, oh, I see you've done this, this, this, this, and this great partner with Radley. And so they see us more as partners. So instead of seeing as competitive with them, they're actually seeing us as partners. And then also, one of the things that a lot of primary care doctors that they struggle with is getting patients to show back up for their appointments. So we're actually helping them with getting people back to their primary care visits. And. And what we're preventing is, again, people showing up in the ER or inpatient behavioral health hospitals at the cost of $2,500 a day.
[00:38:45] Speaker A: This is a great question from Alan Turner, who says, I remember from last time you talked about corporations losing sight of their customers. Has running Radley care changed or reinforced your thinking about that? Do you see this lacking in healthcare?
[00:39:02] Speaker B: One thing that I'm really focused on, and this is whether it's in the healthcare or other professions, is what is the mission of your company and what are they trying to solve? And we're very clear, like, our mission is to empower adults living with serious mental illness to live amazing lives. That's period. That's what we do. And even with that mission, we're very clear even on the adult aspect. A lot of people asking new youth, and I say, no, we're not doing youth now. It's different regulations, it's different certifications, it's different insurances. Maybe we'll get there. But for right now, we are hyper focused on this adult. We're hyper focused on peer support. A lot of people have asked us if we can evolve our model to be like a 24, 7 crisis center for people. And I say no, we're not doing that. That's not what we do.
I'm probably more convinced than ever that you have to be hyper focused, especially the early stages of an entrepreneurial journey about who your customer is and trying to get 100% of that sort of more smaller defined customer base and then you can work out from there. So I think especially in healthcare, it's really, really hard to early on, I mean, try and boil the ocean, for lack of a better word. We're focused on serious persistent mental illness. We don't work with people with other, call it developmental disability needs. People ask, we can work with autism. We don't do it. People ask if we can work with dementia when the elderly. We don't do it. We're hypercritical and hyper focused, especially in healthcare because of the regulations, because the insurances, because of who we actually get our referral partners from. You got to do that mission first and you have to have a stable business with this patient population before thinking about evolving the business model.
[00:40:40] Speaker A: So you were interviewed recently by Ben Shapiro on his show and in that you pushed back on this idea that Radley has to be either a capitalist enterprise or an altruistic one, that creating real value for people can accomplish both. Do you think health care in particular has encouraged us to view profit and compassion as a dichotomy when they don't necessarily have to be?
[00:41:08] Speaker B: I mean, if you think about the probably the history of healthcare, I think history has a long healthcare of leaning more towards charity and altruism. If you go back 100 and 200 years, most of the initial, most of the original hospitals in this country, they were more run by religious organizations and they were much more charitable, just sort of in nature.
But I think if you take a look at the massive leaps that we've made in healthcare over the last hundred years in terms of knocking out certain diseases, in terms of extending people's lives, curing not necessarily cancer, but extending the lives of a lot of people with cancer, that hasn't been done through altruistic purposes. It's been mostly done through people figuring out how to take risk, invest in the medicines, invest into different operations, having different medical devices. They've created or equipment. And what that has done is that that has just allowed them to extend people's lives. Obviously, by extending people's lives, there's a lot of economic value that people put on their life being extended and being better. And so I really think that we should do even a better job of being just open about health care and that health care is very expensive, which means that there's opportunities to decrease those costs. If there's abilities to decrease those costs, then there should be people that share in those economic incentives. And I think companies actually work better when, of course, there's sort of an underlying sort of moral reasoning for what you're doing. Just doesn't even matter. If it's healthcare, it could be education, it could be obesity, it could be housing, you name whatever the social issue is. But if you're able to create an innovative business model that ends up providing economic value, that to me is the win, win and really the home run situation. And that's exactly with what we're doing at Radley. We're doing something that has, I think, a very positive moral good, helping people with serious and persistent mental illness live amazing lives. But we're not doing that purely because we're altruistic. We're doing that as well because there's actually a business model to be made that is sustainable, that's going to decrease the cost, which is very valuable for insurance companies. And then that allows us to, I think, have sort of a sustainable business model that's much better than any charity that can be much more large scale, it can service more people, it doesn't rely on donors or donation, but actually relies on creating ongoing economic value. And the more economic value that we create by getting people healthier and healthier, the larger the organization is that we become.
[00:43:31] Speaker A: Any story behind the choice of the name Radley for your company?
[00:43:37] Speaker B: Yeah, no, great question. So my youngest brother, his name's Bradley and he was the one that we're to a large degree doing this for. Unfortunately, Bradley Health and Bradley Care and Bradley Everything in healthcare were taken. So we dropped the B and we called it Radley for kind of two reasons. One, his favorite movie was this biking movie from the 80s called Rad. And he still loves the bike and biking, sort of his passion. We actually have this really cool mongoose decade bike that hangs on our wall in the office place. Kind of the big focal kind of art that we have is we always like the bike. And I always think of my brother as being a big biker and risk taker in the family. And then also one of my favorite books is To Kill a Mockingbird. And there's a character in there named Boo Radley. And Boo Radley was an individual who was kind of a recluse, probably had an undiagnosed mental illness in the book, but ends up being somebody that does a lot of good work, saves the kids in the book.
And so when you get to know a lot of people, serious and persistent mental illness, and you can kind of get them into care, treatment, kind of get them back into the community, they can really do amazing things and amazing lives. So that's why we named it RadleyCare.
[00:44:43] Speaker A: Oh, that's such a great story.
All right. Iliacin asks, in your view, Anson, when can an entrepreneur look at their venture and define success?
Is there a universal metric or does it vary, such as if you go into healthcare?
[00:45:01] Speaker B: That's a great question.
I think every entrepreneur is going to define success differently. There are certain people that would define it in pure, probably economic terms of did I hit a milestone of selling my business for $10 million or $100 million or a billion dollars, or did I take my company public?
I don't think that's necessarily how I define success and outcomes here for Radley. I think that those will be potential outcomes. But I think in terms of what I see as success is, are we really delivering on the two earlier pieces we mentioned of are we driving down cost for health care plans and then are we improving the lives of individuals? And I think for myself, I get very excited when I get data back from our healthcare companies that shows those pre and post analyses of people were costing $100,000 in the six months prior to you intervening. In the six months post, they're costing $80,000. You guys are saving all these money by keeping them out of the er. That's how I really define success, as how many people are we definitely driving down the cost for and are we improving their lives?
And I think if we continue to do what we're doing and scaling from seeing hundreds of patients to quickly thousands of patients and then 10 thousands of patients on a monthly basis, I think an output of that is that we will create a business that will be worth billions of dollars and potentially go public. But in the meantime, I'm just focused on refining sort of our services and packages and making sure that we have an incredible experience for the patients that we're seeing.
And then that's. That's what I'm most focused and concerned on right now.
[00:46:35] Speaker A: Well, speaking of Those patients. Are there any stories or success stories in particular that really stay with you that you'd like to share?
[00:46:45] Speaker B: Yeah, I mean, we have amazing stories and amazing outcomes.
So so far, I mean, one of my favorite stories is that there was an individual that was diagnosed or that was released from an er.
You know, one of these people that had kind of been on the streets, was hard to track down, didn't really have friends, family, needed housing, needed support, needed connectivity, needed getting a job.
And we really started with them last year, building trust. It was literally on Thanksgiving Day last year. One of the first meetings that one of our peers had with this individual was, hey, let's sit down and let's watch the Macy's Thanksgiving Day Parade together. And that's how they initially made and built trust with this individual that had been really struggling in and out of the hospital and built trust by watching the Macy's Thanksgiving Day parade, which you think about. Most people have friends and family, and Thanksgiving is a big day to be together with loved ones. There's individuals out there that just didn't have anybody for Thanksgiving. And then from that first initial meeting, they were able to work with a person to get them into their medicines that they needed, got them now a job. This person now living independently and on their own. And nine months later, we were actually able to. Recently, this person said, you know what? Like, I really like my peer I've been meeting, you know, first started daily and then it was weekly, and now we're at the end of the month and they're like, you know, hey, I want to go a couple months to see if I can do this on my own. And that's actually the type of story that we want to get to, where we don't want people to see peers forever. We want them. It's six to 12 months, work with individuals, get them back on their feet. And then, of course, if something happens and then we need people to reconnect, great. But that's the type of story I love. And like, it took somebody with lived experience saying, hey, I've been here before. I've hit rock bottom. I didn't have friends, family. I've really burned all my bridges doing something on Thanksgiving Day that's pretty cool. Where not a lot of organizations are going to be able to deliver that type of experience and then work with somebody over the next nine months to get them housing, get them a job, get them back on their feet, walk with them. That's the kind of stories that we want to. That we want to Be able to replicate thousands of times across this country.
[00:48:48] Speaker A: Do you see potential partners for this ecosystem that you're creating?
Are they more like government social workers or charitable organizations? Or does it kind of vary by the case
[00:49:06] Speaker B: we work with? It really depends on the individual in terms of what's needed. I go back, we utilize this, this clinical tool called the daily living activities. 20. There's again 20 of these different variables that we look at for people's lives. What are the most acute areas where they score low? And that's what we're focused on. If it's somebody who needs housing is the most critical, we connect them with local organizations that can help people with temporary housing and, and getting them sort of back on their feet. So we have a lot of partnerships, housing authorities, if it's getting them into their primary care, we have a lot of relationships with federally qualified health centers that work with people that might be on Medicaid or Medicare.
So it really depends on that individual. But we're working really with all different partners and as I mentioned, taking full accountability for individuals. And then the two key metrics is with helping them navigate all those fragments, sources, you know, is there overall total cost of care decreasing and going down. And then ultimately do we have stories where, you know, nine to 12 months after we start working with people and intervening with them, are they fully back on their feet and then hopefully they're off, you know, living amazing lives because they've really stabilized, stabilized their lives and then, and then, you know, are being much more self sufficient.
[00:50:20] Speaker A: So I've seen a lot of comments in our comment section here talking about we really have a mental health crisis, we're in crisis. And I wonder about that because the serious disorders that you're talking about, right, bipolar or schizophrenia, you know, you, these are not just, you know, mental, but these also have physiological components. And you talked about instances of this going back to medieval times or you know, even documentation in the Bible of people that were thought to have been possessed but may have been having a psychotic episode. So I would tend to think that that would be, I don't know, pretty stable, at least from sort of a diagnosis point of view.
Of course, if we have the future that you're trying to get to, where these people are being supported and even though they still have schizophrenia or bipolar, they're getting the care that they need and they're able to live better lives. But you know, I mean, yet their fluctuations, say with anxiety and gender dysphoria and suicide ideation, we saw certainly that the government's response to Covid helped to exacerbate a lot of those factors. But when you think about a mental health crisis, number one, are we in a crisis? And how would you define a crisis?
[00:51:55] Speaker B: Yeah, so we definitely are in a crisis. And I kind of separated the feel versus the real mental health at the beginning of this and I think on both sides you could say we're in a mental health crisis. If you put sort of numbers to this. So 1 in 5 US adults at this point, so 20% of the population has been diagnosed with a mental illness and that might be again anxiety, depression, et cetera. Gen Z, they've self identified as 50% of them have been self diagnosed. They generally self diagnosed as having a mental illness. Myself, my belief that's a crisis in and of itself that I think it's more of a crisis of confidence.
And from the field side there's I think more some social things we can do. More people probably listen to this podcast and have thoughts about the steps they can take as an individual to address their needs, whether that's getting faith, whether that's connecting with family, whether that's having a belief in their freedoms. On that field side, it's a problem. Then more on the real mental illness side, there's also real problems. So you're having in 1 in 20 people are diagnosed with a serious and persistent mental illness. But if you take a look at a lot of sort of mental health statistics right now, major depressive episodes in teens are up 2x over the last 15 years. So from 2010 to 2025, up 2x, there's been an increase in emergency room visits of up 42% in the last 15 years for substance use and mental health incidences in emergency rooms.
And then you mentioned suicide. Suicide is now the number leading to cause of death for people that are age 18 to 34. So I think that we're definitely in a crisis. And this is actually something that's shared by both political parties in the United States as well. Vivek Mertha, when he was the Attorney General of the of the U.S. attorney General when he was Surgeon General of the U.S.
he basically mentioned that, you know, we're in the midst of a mental health crisis. One year later, J.D. vance, more on the Republican side said the same thing. We're in the midst of a mental health crisis. And if you take a look probably at your Fox News or your New York Times or your CNN's Wall Street Journal, all of them talk about the mental health crisis that we're in as well. And that's backed up by a lot of the numbers that I just mentioned. So we are in a crisis. I think, again, on the feel side, a lot of this can, I think, be turned back by having this, what I call my five Fs, which is, you know, faith, freedoms, family, fitness, fun, more focus, talk, dedication. Probably a lot of the themes that you would have on your podcast, letting people know that if you. If you, from a faith standpoint, have an idea that you were put on this earth to create, that you're supposed to be a creator, you're creating the image of God, go create. That solves a lot of issues. But then also having gratitude for the freedoms we have in this country, having connectivity with family, being physically mentally fit, and then having some fun. Those are my five Fs that I think can solve some of the feel. And then on the real side of this, we need to have. We need to do a better job as a society. If you look at the history of the people with schizophrenia and bipolar, if you go back, really 100 years ago, we were institutionalizing people. So you didn't really see a lot of these individuals that much because they were institutionalized then. There were a lot of problems with institutionalization. The movie One Flew over the Cuckoo Nest, I think, exposed the. A lot of the problems, especially as funding ran out for the institutions. The institutions, they became overrun. There were a lot of problems with people being committed there against their will. A lot of therapies that were experimental that didn't work, A lot of problems with those institutions from a financial standpoint of running them.
So in 1964, you had this Community Mental Health act, where you were supposed to take essentially people out of institutions, put them into the community. You were supposed to build a lot of mental health hospitals and community mental health groups. The funding really never materialized for that. I mean, really, they were. That. That mental health industry was never built. So unfortunately, since the 60s and 70s, a lot of people with mental health ended up in prison. Prison's not the best place for these individuals.
And I think there's stats now about 50% of people that are in jail, they've been diagnosed with some sort of serious and persistent mental illness. And so what do we. What do we need to do moving forward? Forward. I think, as I mentioned, almost the beginning of this, the mental health, I think, industry, it's not broken. It just hasn't been built. And then we need more people, probably like myself, other entrepreneurs that have had success in other areas going in and building things and building them the hard way. You know, not trying to address the Gen z person on TikTok who's sad about their cat dying and thinks that they're now depressed and we need to, you know, spend all this money on that person.
No, there's too much money and too many people chasing those sort of like vanity customers. What we need to do is build the hard way and we're building this company the hard way, working with providers, building pipes in getting the right information, partnering on patient outcomes, sending them information back, utilizing AI, utilizing people and in person experiences to do that. And I think that's what we need to do to I think really unleash the ability of this country to fix this mental health crisis that we're in. But it's going to take a lot more entrepreneurs like myself to go and do it.
[00:57:01] Speaker A: So as an objectivist, I would probably replace your first F with a C for conviction or maybe even a P for purpose. But I certainly do agree that gratitude, recalibrating your understanding of the world, getting beyond the way that we've been biologically wired to always look for the threats and the negative and to take stock of what is going right in your life would certainly play a role at, you know, restoring that kind of spiritual balance. As I like to say, you can't be objective if you don't have perspective. And I think reminding ourselves of what we have to be grateful for in our lives is really helpful to that. I guess my last question would be that your stated mission is not merely to help people manage mental illness, but to empower them to live amazing lives. What does an amazing life look like for someone whom the traditional system might have defined principally by his or her diagnosis?
[00:58:06] Speaker B: Yeah, I think too much in the mental health industry we were saying if you stabilize somebody, that success and just stabilizing somebody. So they're just in this, okay, catatonic, not going to psychosis standpoint. That should not be what we're striving for. What I think we need to strive for when I say amazing lives, is these are individuals that are fully utilizing their God given gifts and that they're being able to go out and they're being able to create, they're being able to have jobs, they're creating families, they're going and being able to go to their kids little league baseball games, they're participating fully in sort of the human experience, they're being able to think cogently, being able to write cogently, being able to be in groups and discussions like this that's what I want from an amazing life. And I like what you said as an objectivist, that you would replace my first F with conviction. And for myself, the faith, whether it's faith in the almighty dollar, which I love seeing every time I'm on the show, or it's just faith that you're here for some greater purpose, that's what I want people just to really get to. I think that's what's really missing with people that have serious and persistent things, mental illness, that they're here for some greater purpose and that they've been given gifts and abilities and they got to use those to the best of their abilities to hopefully help others as well.
I don't know. That's what I think we're all trying to figure out here, the purpose of life. And I always say that, at least for myself, I was created in the image of God and God's the ultimate creator, so I should go out and create as well. But whatever that is, whatever that conviction is, or whatever that faith is, I want people to be able to find that. And you can't find that if your head's clouded and you're in sort of a psychotic state and you're in a bad state, but to find whatever that is for those individuals and then help them live those, those amazing lives.
[00:59:49] Speaker A: For anybody who is watching that, you know, may know of somebody who needs help, where should they go to learn more about RadleyCare and the services that it might be able to provide?
[01:00:02] Speaker B: Definitely. So we have our website, which is radleycare.com so you can go to our website, navigate there. There's. If you have questions, feel free to submit them. I think inforadcare.com I see everything that comes in through that, that, that box. And then if you're in the state of Ohio, we can, we can start working with. If you have loved ones now. I mean, one of the things that I've been amazed about on my own family's journey is when my, my. My brother, he first started experiencing schizophrenia and, and psychotic, we were very closed. We didn't really talk about it. There's, I think, a lot of shame and mental illness. Over the last 20 years, we've opened up a lot about our journey. And the more we've opened up, I've been amazed about how everybody seems to have these days a friend, a family member, a relative, a colleague that has a similar story that our families had. So I always like connecting with folks and most importantly, connecting to resources that have helped us and that hopefully are going to help thousands of more people over the next couple of years.
[01:00:58] Speaker A: Well, Amsin, this has been a revelation, and I really enjoyed our conversation. And I'm wishing you all kind of success in this new venture. Sounds very exciting and I hope you'll keep us posted.
[01:01:11] Speaker B: Great. Well, thanks again for having me. Really appreciate it.
[01:01:14] Speaker A: Thanks to everybody for being there, for putting up with the change in ours. We really got a great core crew of people that always show up for these episodes. And from Portugal, with love, I really appreciate you.
Next week I will be off, but my colleague, senior fellow Robert Krasinski, will host an episode on a hot topic, data centers. The attacks against them and why they're actually the data centers. They are. That is a good thing. So we'll see you then. Thanks.
