Dr. Bielamowicz Goes to Austin
September 10, 2026
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Welcome to TrustWorks On Call, here with your healthcare business and strategy 411 for the week. If you enjoy our work, please consider forwarding it along to a friend and encouraging them to subscribe.
It was a slow news week coming out of Labor Day Weekend, so rather than responding to a lead scientist at Anthropic saying, "We really do earnestly believe AI could kill all humans! I personally think it is >10% within the next decade,” we are going to ignore the impending extinction of humanity and focus on something more immediately frightening: healthcare costs.
Last week, TrustWorks’ very own Lisa Bielamowicz, MD, testified in front of the Texas state legislature’s Select Committee on Healthcare Affordability, educating representatives from her home state about the health system business model and how to pronounce her own name (that’s Bill-uh-mah-vich). To share what we learned that day, we’re going Beyond the Whiteboard on the double meaning of “healthcare costs” before Dialing In on how Texas legislators are much more concerned about consumer costs than provider financials at this time.
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Behind the Headlines
Unpacking the forces driving healthcare's biggest stories.
| As the BBC announced on April 18, 1930, "no news today." |
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Beyond the Whiteboard
Visualizing key trends from the healthcare industry
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What We Talk About When We Talk About Cost
Healthcare has a cost crisis on both sides of the transaction. Patients and employers are paying too much for healthcare, while at the same time hospitals and physician organizations are increasingly saying they cannot afford to deliver it. It is a poorly functioning market when the same dollar can simultaneously be inadequate revenue to the provider and an unaffordable price to the purchaser. In aggregate, patients’ cost crisis is captured by the ballooning of national health expenditures, from $353 per capita in 1970 ($2,208 adjusted for inflation) to $15,474 in 2024. Healthcare spending now occupies 18 percent of gross domestic product, and it is expected to hit 20 percent before long. This spending growth comes from three factors: the average person is receiving more care (increased volume), paying more for better care (improved quality), and paying more for the same care (price inflation). If you asked consumers, most would not say their patient experience is much improved, either. Why are consumers paying more for the same care? Because it costs providers more every year to deliver that same care. Tackle providers’ cost problems, and consumers’ healthcare cost growth can slow as well.
For years, the industry's answer to rising costs has been scale: larger health systems, larger physician groups, larger payer networks, and increasingly consolidated markets, all with the promise that size would create efficiencies. Yet healthcare continues to become more expensive for purchasers while many of the organizations delivering it say their economics are deteriorating. If scale hasn't made healthcare meaningfully cheaper to buy or deliver, policymakers are increasingly entitled to ask where the promised efficiencies went.
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Dialing In
Sharing insights from our work with clients
Legislators View Hospitals as Part Problem, Part Solution
“Show me the incentives, and I will show you the outcomes,” said Committee Chair James Frank to commence the September 1 meeting of the Texas House Select Committee on Healthcare Affordability. He continued, “No industry has incentives more misaligned with its customers than healthcare.” The hearing assembled leaders from across Texas representing the perspectives of physicians, hospitals, employers, consumers, payers, regulators, and a celebrity healthcare entrepreneur, Mark Cuban. On behalf of TrustWorks, Lisa Bielamowicz, MD (a native Texan, unlike Cuban) had the opportunity not only to share with the committee her perspectives on health care delivery and finance systems, but also to snap a picture of the former Shark Tank investor’s shark-themed socks.
Lisa explained to the Texas legislators that the health system cross-subsidy business model is fundamentally threatened by aging demographics, rising input costs (especially labor), and the outpatient shift. The solutions to these problems will involve creating a consumer-centered health system that is accessible, affordable, reliable, and personal. Efficiencies gained from radical cost restructuring and the embrace of AI-powered digital health should pair with new payment policies that reward providers for shifting care to lower cost and more accessible settings. No health system in the country has perfected this model, and most remain tethered to traditional fee-for-service economics even as the cross-subsidy model supporting them erodes. As an industry, we are still figuring out what comes next.
Health systems have traditionally enjoyed a privileged relationship with elected officials, in part because they are often among the largest employers in their communities. In this hearing, however, the dynamic was noticeably different. The committee was responding to constituent complaints that healthcare is too expensive, putting health systems on the problem side of the ledger. Someone wanted to know how to distinguish between hospitals that are really struggling from “so-called safety-net” providers with deceptively favorable finances, so they can use policy as a “scalpel, not a hammer” to help only the systems most in need, especially in rural areas. Others inquired about the role of consolidation and private equity in driving up prices, and how to develop better funding and operational models for primary care and behavioral health, so we can measure and maximize the savings of preventative care.
One representative asked Lisa a question that pitted health systems’ status as job creator against their role as cost driver. Responding to the stat that labor comprises 60 percent of health system costs, she wanted to know how to balance technology-driven efficiencies against their impacts on employment and talent recruitment. It is an uncomfortable but unavoidable question. AI’s productivity enhancements only become labor savings when organizations decide to hire or employ fewer people. Not-for-profit health systems are rightfully wary of layoffs, but they also have an obligation to their community to lower costs.
State legislators, especially when working part-time in most states, have the difficult responsibility of making highly impactful legislative decisions on matters inevitably outside their expertise. Their job often comes down to listening to experts and sorting the signal from the noise. Setting aside a few moments of exception (we have no position on the impact of quantum computing on consumer healthcare costs), the committee members came across as informed, interested, and invested in finding solutions to excessive healthcare cost growth for their constituents. They approached the problems from partisan perspectives, but all wanted the same goal: better access and lower costs for their constituents. Aside from a few experts (including Mr. Cuban) taking pot shots at their healthcare rivals, no one was there to play the blame game or dodge accountability.
Everyone recognizes there has long been an incentive mismatch in healthcare, which has created a cost crisis on both sides of the transaction. What is new, however, is that elected officials are losing sympathy for the cost problems providers claim to face. Legislators' aim is to calibrate policy to induce a more efficient care delivery system without triggering service cuts or hospital closures. Everything else seemed to be on the table. Health systems that can offer new care models with demonstrably lower costs, better access, and improved outcomes will find a public ready to reward them with loyalty, and an industry ready to follow in their steps. Systems asking policymakers for financial relief must be ready to provide new answers to this question: what does helping you do for my constituents?
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