Medicine's broken workflow, with Kevin Schulman, M.D., MBA

Kevin Schulman, M.D., MBA, professor of medicine, clinical excellence research center at Stanford University, joins the show to talk about why the U.S. spends more on health care administration than many countries spend on care itself.

Schulman explains how complexity in billing and payment drives up costs, why current processes are still stuck in the analog era and how ideas from other industries could help create more efficient, digital systems. The conversation also explores the role of AI, the impact of prior authorizations and what reducing administrative waste could mean for physicians, patients and the future of health care.

Read "Addressing Health Care’s Administrative Cost Crisis," Schulman's co-authored viewpoint in JAMA.

Don't miss our recent episodes on staying resilient (live from the MGMA Leaders Conference 2025), women leaders in medicine, challenging your limits and the future of medical research.

Music Credits:
Restless Minds by Yomoti - stock.adobe.com
Relaxing Lounge by Classy Call me Man - stock.adobe.com
A Textbook Example by Skip Peck - stock.adobe.com

Editor's note: Episode timestamps and transcript produced using AI tools.

00:00 – 01:32 | Opening & Introduction
Austin Littrell introduces Off the Chart and sets up the interview with Dr. Kevin Schulman, professor of medicine at Stanford, to discuss the administrative cost crisis and “precedence thinking” in health care.

01:32 – 03:01 | Scope of the Problem
Dr. Schulman describes the staggering scale of administrative spending — roughly a third of all U.S. health care costs — and the chaos of 318,000 plans, 600,000 billing codes and 57 billion prices.

03:01 – 04:34 | Administrative Burden in Practice
He shares firsthand frustrations from hospital medicine — coding queries, irrelevant documentation and network gaps that cause endless rework.

04:34 – 14:11 | Precedent Thinking Explained
Defines “precedence thinking,” contrasting analog vs. digital processes, and explores how other industries solved analogous problems.

14:11 – 14:30 | Promo Break – PatientCareOnline.com

14:30 – 19:25 | “Health care Is Different?” and Rebuttal
Addresses skepticism that medicine is too complex to standardize; compares U.S. costs with the Netherlands, explains why analog systems worsen prior auth inefficiencies and warns of fraud risks in analog transactions.

19:25 – 22:49 | Centralization vs. Standardization
Discusses the difference between those concepts, citing Medicare-for-All debates and arguing for a mixed public-private system with streamlined transactions rather than government centralization.
(Includes Keith Reynolds’ “P2 Management Minute” segment at 22:00 – 22:49.)

22:49 – 27:15 | Digital Contracts and Payment Reform
Explains modular, machine-readable contracts to reduce manual renegotiation, modernize prior authorization and target fraud and waste digitally instead of analog paper processes.

27:15 – 30:03 | Physician Burnout and Workforce Impact
Links admin burden to burnout and hospital employment trends; warns AI could double documentation queries and further erode job satisfaction.

30:03 – 32:32 | AI in Research and Payments
Describes how AI was used in his research and how unregulated AI in payer systems could increase complexity and drive physicians from practice.

32:32 – 34:00 | Policy Context – “Make America Healthy Again”
Frames administrative reform as aligned with federal anti-fraud and efficiency initiatives; calls it a rare bipartisan opportunity.

34:00 – 34:53 | Message to Primary Care Physicians
Urges doctors to advocate for change and reject the notion that current administrative complexity is inevitable.

34:53 – 35:46 | Closing Exchange
Richard Payerchin summarizes themes and thanks Dr. Schulman for joining.

36:01 – 36:58 | Outro and Credits
Austin Littrell closes the episode with subscription and newsletter reminders and production credits.