November 8, 2023
Welcome to Perspectives, Leerink Partners’ signature podcast, where we share our insights and interview leaders across the industry to get their perspective on how they’re driving innovation. We’ll also be digging into the backstory to learn more about what has most influenced their success. Be sure to check out all episodes by Leerink Partners.
Thad Davis: Welcome everybody to the podcast again. It’s my pleasure today to be joined by Brian, the CEO of Aware Recovery, and we’re gonna have a, a great conversation with a, with a guy I’ve done, I’ve spent a, a lifetime with last year or this year, I guess, at, at this point with Brian and I have done a little work together. But thanks for joining the podcast here, Brian. It’s a pleasure to have you on.
Brian Holzer, MD: Thanks, Thad. Really appreciate you having me on.
Thad Davis: As we’ve talked about before on the podcast, what we tend to focus on here is, is learning more about you. I’ve tried to, as we’ve kind of curated, so to speak, the, the attendees of, of the podcast here, I think it’s a unique opportunity. You’ve had a, we’ve had a lot of unique careers. I was going through your resume earlier. I think you’re probably one of the most unique. You’ve done literally one of everything in the healthcare space. The most qualified healthcare executive of all time you’ve actually done medicine too, which is, which is always a benefit in healthcare.
Brian Holzer, MD: It’s been a wild ride, never planned for this.
Thad Davis: Yeah, exactly. Yeah. I didn’t, didn’t think I’d be right here, but I’m right here you know? let’s talk about early, ’cause I, I think people kind of stepped past, where you’re from, what you do. I mean, what was the backdrop? Did you have a, as a child, did you say, “I’m gonna become a doctor and then I’m gonna become a CEO?” Is it in that order?
Brian Holzer, MD: Yeah, I mean, I grew up in Pittsburgh, Pennsylvania, I actually stayed in Pennsylvania for the first 30 years of my life. I mean, I went to Penn State for undergrad. I did medical school in Philadelphia. I did business school in Philadelphia, and you know, the running joke when I, uh, when I was at Wharton in business school is about 40 or 50% of the class was international and there was probably only about a half a dozen people that actually were from Philly in my, my class. We showed up and everyone’s talking about all of the international countries they’ve been. And I just blew up the state of Pennsylvania and put a bunch of thumb tacks on all the various places that I’ve been in Pennsylvania ’cause that that was the extent of my,
Thad Davis: “I’ve been to Harrisburg, I’ve been to Philadelphia.”
Brian Holzer, MD: Scranton, Wilkesboro. Ironically ever since I’ve been a nomad traveling around the country and I’ve, you know, I’ve been in a lot of different markets doing a lot of different things.
Thad Davis: Yeah. In, in Pittsburgh. I mean, growing up how, how’d you become focused in like, in medicine? Because I always find it interesting, like, whenever you speak to somebody that went through, like went through an undergrad, undergrad into medical, I mean, there’s always something that’s kind of resonated or connected with them in terms of, “I want to be a doctor or this, this element of my life or something drove me to be a doctor.” Was there something unique about that that kind of got you to that? You’re like, “I’m gonna go, I’m gonna go to Penn State. And I’m gonna go to Drexel.”
Brian Holzer, MD: I’m just a, I’m a product of my parents and, and my upbringing. My mom was a stay-at-home mom, did some things along the way, but my dad worked for the same company for, for almost 50 years, having since retired, uh, in the last five years or so, and self-made guy, sort of fought against not having a lot of education. And it just was always stressed, from the beginning. And, and he was, a super connector in the role that he had in, in the commercial banking industry. And all of his friends, my parents’ friends growing up happened to, it seemed like every other person was a high performing, successful physician that was also a lot of fun to be around, had a lot of super interesting interests and so that really drove the combination of education, being stressed from birth, and then being surrounded by so many successful people, many of them in healthcare and physicians themselves. I just sort of wanted to emulate what was around me growing up, and I, I was sort of beelined to medicine from, from really elementary school on. It was just something that I always thought that I wanted and didn’t really have any competing interests.
Thad Davis: Your father was in commercial, did he specifically focus on healthcare or was it just sort of the community? He’s banking successful people and thus, you know, doctors tend to be successful, so.
Brian Holzer, MD: It’s more the latter. He, he, he worked for PNC Bank in Pittsburgh when it was called PMB.
Thad Davis: Oh yeah. There you go. Yeah. Yeah. That, that’s old school that shows you, that shows you how long he’s been with it. Yeah. That’s amazing.
Brian Holzer, MD: Started as a branch manager and, and ultimately his last role was to run the Pittsburgh market. And so, his, he was very, a pillar of the community and, and very much connected to a lot of very successful people across a number of different industries. And just on the personal front, a lot of his personal friendships ended up being with, with physicians, and I was always surrounded by those folks and very influenced by that group of people.
Thad Davis: Yeah. And so then, then Penn State, and then right up to Philadelphia to Drexel. Right down there, right down right in the core of Philadelphia. I mean, that’s, that’s I guess Pittsburgh’s pretty, Pittsburgh’s kind of urban to, to, you know, Philadelphia, but Drexel’s about as urban as you can get around medical school. The NYU, the NYU of Philadelphia, I guess.
Brian Holzer, MD: Well, the funny thing about my medical school experience is it was actually called MCP Hahnemann. MCP was Medical College of Pennsylvania, which happened to be the, the first and longest standing women’s medical college, which unfortunately then closed. My medical school was actually four names in the four years that I was there.
Thad Davis: You’re like, you’re like, “What is it today? What am I graduating from today?”
Brian Holzer, MD: It was not Drexel when I started. It was, it was MCP Hahnemann and ironically it was connected to Allegheny General Hospital in Pittsburgh. There was an attempt by a CEO at the time, who’s now passed, to create a statewide medical system, and it was a bold idea that probably could have gone either way, but it ended up leading into a bankruptcy and ultimately Tenant came in to acquire the hospital assets and created a relationship with Drexel, to ultimately potentially buy the medical school. And that’s what happened right before I graduated.
Thad Davis: That’s interesting. Yeah. You don’t, you don’t hear, that’s an interesting sort of path there. I mean, it’s like, like “I started one institution, got ran, ended up in another institution”, but I mean, it’s a pretty good outcome there. Have it with Drexel. And from there, the medical practice because you didn’t, you, I mean, you, you went and practiced for a little bit of time, but you moved on to business pretty quickly. I mean, what, what was the, how, how do you think about that transition there?
Brian Holzer, MD: I mean, I still can’t, I get asked even today. I graduated in 2001. I get asked 22 years later, “why did you leave medicine?” And I still don’t really have the answer.
Thad Davis: Pretty, pretty turbulent time. 2001. I mean, that’s like, I was just kind of, I mean that’s like there’s a lot of volatility in the overall market then. I mean that’s dot com, that Web 1.0 explosion, stuff like that.
Brian Holzer, MD: I was in my little bubble of medicine. I didn’t really even understand any of that. I mean, I think ultimately it was a little bit of, you know, my father’s genes sort of starting to express themselves. Having been around business for my, my entire career and sort of waking up and realizing, you know, I’m still trying to figure out who I am as we all are, but, if you have a beeline to medical school, you’re doing it so young. I mean, I graduated medical school, I was probably 22 years old. You don’t know what you want. But I started realizing that I, I wasn’t an entrepreneur, but I was entrepreneurial. And even today, medicine doesn’t lend itself to a lot of entrepreneurial activities for physicians. And I just started asking questions and thinking differently and sort of pursuing alternative ways of thinking. And when I, when I was considering leaving medicine, there were no mentors. Uh, in fact, I was told to keep quiet because if I expressed a desire to, to leave medicine, I would’ve been told “you just wasted a medical school spot.” That’s how different things have been.
Thad Davis: Oh, yeah, yeah, yeah, yeah that’s an interesting point, like the transition in the medical community over sort of that 20 plus years where people have gotten more internal about the commercial drivers of what they’re doing and they’re like, “Hey, I’m gonna go to medical school and then I’m gonna go do this.” It’s interesting how you say that. ’cause I know, like I know lots of medical students now who did something and then they’re gonna go to medical school and then they’re going to go and do something entrepreneurial like, you know, 20 years ago people would be like, “what are you not gonna be of service? You’re like, you waste, you’re gonna go, you do business. That dirty business thing”
Brian Holzer, MD: There was animosity. I mean, it’s you, you just wasted a, you just took away a spot for someone that was gonna be a doctor. And so, 10 years ago I would get a call a month from somebody trying to think through this as well, and, and medical students calling me or people applying to medical school saying, “I, I, I just wanna understand what you did. I’m thinking about going to medical school and not practicing.” I’m like, “there are better ways to drop a hundred grand.”
Thad Davis: Yeah, I say the same thing to the junior bankers that our firm, they come to me and they’re like, “should I go get an MBA?” And I’m like, “you mean to, to go spend money to come back to do more banking?” I’m like, “what are you, what are you doing?” They’re like, “yeah.”
Brian Holzer, MD: So, to answer your, your question, I felt the need to not make a seminal decision of leaving medicine for business. And I ended up finding a route to do a one-year residency, which was called a transitional internship, to sort of buy some time where, one, I wanted to be a doctor, I’d worked very hard, I wanted to wear the white coat. That was sort of an inspiring thing as you’re going through medical school, you got a short coat, and you just look at all the people that get long coats and you wanna wear the long coat.
Thad Davis: I want the long coat. Yeah.
Brian Holzer, MD: So, but I didn’t want to commit to a, to a what’s called a categorical residency or a full residency. And so, I came across at the 11th hour, a one year, one year program. I applied to a bunch of places and convinced the, the, the admissions folks at University of Pennsylvania’s one year program, that I was different enough and worth having in their program. So, I did a one-year program affiliated with Penn Health System and loved it, and fell in love with emergency medicine in particular, and, and largely because even today, ER docs still get to practice medicine. Like you get a patient that comes in, you don’t have to ask insurance companies with someone’s coding what you should do.
Thad Davis: You’re not preapproved, Yeah. Yeah. Exactly. “I know you’re bleeding out, but I need you to, uh, hold on one moment.” Yeah.
Brian Holzer, MD: So, I was drawn to that because you gotta, I, I, I saw even back then what was going on with the administrative complexity of being a physician. And I loved ER medicine, and I thought very strongly about continuing it and ultimately decided, which I still can’t answer, why exactly, to pursue an MBA and leave the clinical medicine track.
Thad Davis: In that time with like your class time kind of coming up and like the, the folks at your contemporaries at that time, how many are still practicing or have they kind of moved on from practice or do you have any sense of like, or like, were you anomalous for that class period time or were you the, the, the per, everybody looked at what you did and they’re like, “yeah, I’m getting out too.”
Brian Holzer, MD: You know at med, med school’s stranger than business school in that, I mean, I was 22, and you spend two years taking classes with people, and the last two years are rotations in the hospitals, and so you get distributed. So, I, I actually, I’m connected with some folks on Facebook. I barely remember them, and I’m sure it’s the same. Uh, it’s not like business school, which again, I graduated in ‘05. That’s still a ways ago. I probably still keep in touch with casually a couple hundred people.
Thad Davis: Yeah, that’s, I guess, I guess like that’s a, yeah, putting a, all physicians will email me after this, but it’s like a medical school is a vocational program, people are there to get the education, they get into the practice there, they learn on the job versus business schools like, my University of Chicago Alma Mater for Business School would freak out, but it’s a two year party.
Brian Holzer, MD: Yeah, I don’t wanna demean, there was a lot of people that worked very hard, but, it’s a transition period where they’ve killed themselves for, you know, three to five years and it’s a transition to, you know, to explore. And, and so there is a lot of exploration and part of the exploration is exploring relationships with your classmates, and that’s,
Thad Davis: Shared, shared life experience.
Brian Holzer, MD: A big part of the, the business school experience that’s unlike medical school where it’s literally a two-year race to learn as much information as possible and it’s, it’s a different experience.
Thad Davis: That’s actually a really good way better than my party analogy. The transitionary time. I mean that, that, that’s correct because it gives you, everybody’s trying to sort themselves around business versus like this fire hose of medical knowledge being applied to your brain at the same time they’re like pushing you to perform at, at sort of a high velocity.
Brian Holzer, MD: And you’re older. I mean, again, when you’re older and, and you’re sort of a point where you’re getting, you’re, you know, you’re getting to an age where people are thinking about families and what’s next and, you know, being an adult, versus you know, med school’s just an extension of college, I mean, you’re so young. It’s, it’s really hard to, it’s really hard to understand the perspective of, of life.
MUSIC TRANSITION
Thad Davis: So, you picked up, you picked up after business school and moved on to you, you took a tour through the, the pharma world with first, with Amgen and then onto Spectrum. And you, you did actually, you went almost all the way over to the, like the, like the sales and marketing side pretty heavily. I mean, you went deep business on that. So how did, how did you move out of that transitional program into, into the pharma, the pharma universe?
Brian Holzer, MD: When I started in business school, I, I literally knew not, I mean, I knew nothing. I mean, I, I had spent, about anything. I mean, I had spent, you know, all of my formative years literally drinking from a fire hose of clinical information. I didn’t have a lot of perspective. It’s one of the reasons an MBA was so important for me, and I got thrown in with whatever it is, seven or eight hundred people, and I was a kid in the candy store just sort of exploring and learning and understanding a world that I had not been exposed to. And I had the opportunity to sort of check things off that I didn’t want to do. It was more or less I knew what I wanted to do and more as I learned about things, I didn’t, no offense, didn’t wanna be a banker. I, I didn’t have that skillset.
Thad Davis: None taken. Yeah.
Brian Holzer, MD: I didn’t think I wanted to be a consultant and back then 40 or 50% of, you know, my business school class was, was anchoring on those, those two. And so if you choose not to do that, that’s a very big decision ’cause now you’re left with what’s out, what else is out there. And that’s a lot of the traditional businesses. And so, I, I gravitated towards biotech, which was really hot back then and medical device, which was also and still is, really hot back then. And it, there wasn’t this world of entrepreneurship that a lot of the business school students are immersed in now. It was still a fairly traditional go work for bigger companies. If you’re not gonna do banking and consulting, go work for bigger companies, get trained and sort of develop sort of toolbox, tools in your toolbox. And I got really drawn to the Amgens of the world, the Medtronics of the world that had these commercial leadership programs and alumni that were there, sort of, recruiting you and such.
Thad Davis: The Amgen commercial program. I mean, that’s, that’s, I mean, I, I’ve met people came out of that program, over time, even still with Amgen. I mean, those, those programs, people kind of, people kind of forget, but in the timeframe that you are attaching to something like that, that’s extremely attractive. They’re like, I mean, they put the sale on you and you’re like, you’re gonna be moved around. You’re gonna have access and opportunities. You have the exposure, you have the highlight on you. You’re like, “oh, that sounds good. I’m gonna go do that.”
Brian Holzer, MD: And again, at that age, you’re still following the herd. Your ability to sort of think for yourself is, is not a skillset that lends itself to your twenties and early thirties. And Amgen and Medtronics of the world were, were biotech and, and med. These were really hot industries. And to your point, I was really drawn to these commercial leadership programs that promised this mentorship and upward mobility that the programs would give you. Ultimately, I did my internship at Amgen on the summer between my first and second year and just fell in love with it. I’d never been to Southern California. Fell in love with the weather.
Thad Davis: That’ll do it. You’re, yeah, you’re like, you’re like, you’re like, “this is pretty nice out here.” A Thousand Oaks or whatever. Right. It’s like, “yeah, this is a pretty nice place.”
Brian Holzer, MD: Yeah, a great manager who I still keep in touch with today, ironically. And so, I, I ultimately decided, I was fortunate enough to get an offer to come back full time. It was to actually start in the sales force and do an 18-month rotation after graduation, and then transition to Southern California where I spent another four or five years as you, as you alluded to.
Thad Davis: Oh, that’s interesting. So, they, they actually, they actually run you through, so actually they’re like, “listen, you’re gonna go sell and then you’re gonna come back to corporate and, and, and so you understand exactly what’s going on in the field.” So, they actually to do a field rotation or did you seek out the field rotation?
Brian Holzer, MD: No, that’s, I picked it ’cause I, I drank the Kool-Aid that they had a three-year commercial leadership program with a full 18 months in the sales force as your first role for everyone. And then a full 18 months after you transition in a product manager role, and then you would be, in their eyes, positioned to interview for, you know, senior manager roles and such.
Thad Davis: Because you’ve seen the breadth of the enterprise at that point. That that’s, those, those are good pro, those are good programs. I mean, not a lot of, it’s hard to get that exposure, like where it’s structured, like you’re gonna go learn to sell, then you’re gonna go learn to position to sell. Now you’re gonna get to go manage. Like that’s, that’s pretty good.
Brian Holzer, MD: And what seals it is, you don’t have to fight for that first job back in. Right? You do your sales rotation, and they guarantee you that first marketing position. And I look, I mean, again, it’s like it’s tough to appreciate things early in your career to this. To this day, the training they got at Amgen, you know, I, I leverage almost every day. It was one of, of all the companies I work for, and there’s a lot of them were ill formed positions that I’ve had to create within and I, and actually sought that out. But as I look back on my career, the ability to sort of learn a business from the sales angle up and understand how messages can be executed at the level of the customer, it’s really driven almost my entire career path. And I’m thankful for that experience every day.
Thad Davis: That’s great. I mean, sounds like, that sounds like that was perfectly, a perfectly formative, then you basically took the skills from Amgen, went to Spectrum, and then, and then you made a transition from, you made it. This is, I think also another sort of, so we, we did the medical school transition. We did the transition to pharma. That’s the good bridge here. But then we had Wayne DeVeydt on, uh, for a earlier podcast. He made a transition from insurance to services, which is closer. But you went from pharma to services. And went over back, I guess, went back home to the Allegheny system at the time. So, what, what kind of, what was the switch up there? I mean, that’s a very, I mean, that’s a totally different business process.
Brian Holzer, MD: Yeah. Look, I, I loved sales and marketing. I just, I saw, I got to a point where I was worried that if, I viewed it as a softer science, which really is an unfair statement, but I was starting to get to a point where I, I thought in my head I didn’t know, I didn’t know what that meant. I wanted to run companies. I wanted to do general management. I wanted to run stuff and in biotech, it’s so linear in terms of the ascent. It’s tough to get creative and branch out. And it’s sort of this theme of being slightly more creative than the next guy and, and sort of looking at traditional paths in a career. And I was always thinking just slightly different enough. Not founder different but slightly different enough to be open-minded to, to interesting opportunities. And it’s just one of those things. I ended up going back to Pittsburgh every year ’cause my hometown ended up playing golf at the perfect time with the incoming CEO of, of the Allegheny Health Network, which was just formed.
Thad Davis: Oh wow. That worked out.
Brian Holzer, MD: Two months prior from Highmark’s Recapitalization of the West, West Penn Allegheny. And he and I had a conversation. I said I was getting a little, you know, antsy about my, my career path and looking for something a little different. I wanted to run companies. He’s like, “I got something for you.”
Thad Davis: “We’re, we’re, we’re forming a new, we’re forming a new, uh, insurance and services carrier. You wanna join up?” You’re like, “Sure. Sounds great, bro.”
Brian Holzer, MD: Yeah, and I literally, like, this is, we’re talking November of 2000, I wanna say, 13. I’m living in Southern California. I’ve just had my third kid, my wife’s parents live in five miles from Spectrum in Southern California, and I’m like “we’re moving.”
Thad Davis: You’re like, “I need my parents, and it’s time to roll the dice.” Yeah.
Brian Holzer, MD: So, I, I moved her and my youngest was six months at the time to, to Pittsburgh and was one of the worst winters, she was a trooper and very thankful, but it was, it was tough on her. We did it, tough on the family, and I didn’t know what I, I, I was, I ran so quickly to this innovative concept of a new opportunity. I didn’t have any idea what I was signing up for. And I show up on my first day. And I got handed post-acute by,
Thad Davis: Oh, wow. Okay.
Brian Holzer, MD: I gotta turn around this health system. This is a guy named John Paul, who, who I count as one of the most influential people in my, my career. A visionary guy that came from UPMC that had started a lot of these businesses at UPMC with these, which now sort of a large international commercial services division, but this concept of monetizing non-core hospital operations, businesses that were outside of core operations and post-acute in his eyes, was something very, very important for hospitals to capitalize on. This was 2013, I mean, so forward thinking.
Thad Davis: Early, early innings. Early, early innings for a hospital to be thinking about that. Yeah.
Brian Holzer, MD: And UPMC was one of the only systems that had started down that path. And he wanted to do the same at the Allegheny Health Network. And I was a kid in the candy store I was making, this was the Super Bowl for me. I was transitioning careers. I had moved my family, my wife’s smiling, but I know she’s not happy.
Thad Davis: Hey. She’s like, “it’s really cold here this winter. This is not Southern California.” Yeah. Pittsburgh is not Southern California.
Brian Holzer, MD: This better work. So, I just took it, you know, I just took it to the next level. I mean, I, I, I just ran really hard at trying to understand the opportunity of post care businesses with health systems. I ran into some like-minded individuals across the enterprise, and we went to town and in a very short period of time, probably within a year, I had formed I think five joint ventures, a home health joint venture, a hospice joint venture, a durable medical equipment joint venture, an infusion joint venture, and an emergency medicine staffing joint venture. And had organized it under a brand called Healthcare At Home because it, it appeared very early to me that what ailed this post-acute care model was the lack of connectivity amongst these fees for service silos. And here we’re sitting on all the volume of the health system discharges, and I saw the vision really quickly. And, and just went after and, and, and he was so busy trying to turn around the health system. I flew underneath the radar long enough to get something stood up that then became meaningful.
Thad Davis: Clearly that went well. I mean, it doesn’t sound, it doesn’t sound, I, I do not know John Paul, but it sounds like he was a fairly smart guy. So clearly you were doing, you so clearly you were doing some level of execution correctly. Otherwise, he would descend and stopped that adventurism right there.
Brian Holzer, MD: He was just a, you know, he since retired, we still came in touch. Just a really creative guy and just aggressive, innovative and aggressive and creative and didn’t need to know the answer to everything. Just relied on instinct and gave me enough room to run to a point where we developed something that still exists today. I mean, the concept of Allegheny Health, Healthcare At Home is a brand that has stood the test of time and has become a, a really interesting acute to post-acute care integrated model. And it’s sat I was on the AHN side, the hospital side, and ultimately when David Holmberg came in, he’s still the CEO of Highmark Health, another visionary guy. It, it became important to the enterprise and, and ultimately, I was afforded an opportunity to get up to the enterprise level and think about enterprise approaches to post-acute and more good things happen through that, that transition as well.
MUSIC TRANSITION
Thad Davis: You said something earlier about development of independent thinking. The 4 to 10, kind of like I did 10 years of, I did 10 years of business experience in four years. I mean, this sounds like at this, at this stage, you, you had that sort of spark coming out of the pharma era. You wanted something a little bit more ownership oriented, but it sounds like that the ability to independently not, don’t take this, take this the right way, but just the, the, the ability to independently think or to lead and think and solve that for you. You sort of became untethered at that point in a good way. You’re like, “okay, I can run things. I can do things.” And that sort of experience train seems to have like launched, oh, it’s launched a lot of things for you at that point. It’s like that was that sort of like twenties to thirties transition, right? It’s like, okay, rocket ship, here we go.
Brian Holzer, MD: Yeah, that, and, you know, I was just dumb enough to go after some of these things that you look back and if I, if I knew a little bit more, I would’ve said you’re crazy.
Thad Davis: Like, yeah. It’s like it’s pretty, you have Doctor, Pharma, you know, Allegheny. It’s like, yeah. It’s like, “how, how was my success? I didn’t think too much about it. I just did it.”
Brian Holzer, MD: But some of there, if I would, if, if I’m being honest, I’ve had a chip on my shoulder that’s slowly going away for a lot of my first decade in business ’cause I, I spent my entire twenties in school. So, I’m not even sure, I think I’m just getting to a point where I meet the requirements for job descriptions in terms of having enough years of experience.
Thad Davis: You’re like, “I’m highly educated. I have a lot of years,” but I mean Allegheny. But every, every great. I think if you go back, every great executive has like a, has like one of these career stops along the way where like “I landed in this opportunity to absorb a massive amount of learning very quickly. It was springboard from Amgen to Allegheny and then I had a more of a landscape perspective. I can make decisions and I knew how to create value.”
Brian Holzer, MD: That, and I just felt a degree of urgency to execute, like, and to make up for lost time and to do something. It’s always driven me to the point now, it is what it is. I’m got enough gray hair that that’s no longer the issue.
Thad Davis: Always a hair of paranoia. Always does a career good. It does a career well.
Brian Holzer, MD: Sure. But in my early thirties, I was, I was trying to prove to myself and others that I was ready and, and it, I just worked extremely hard and was very motivated and driven and it just, all worlds collided, as you said. I was given, I was untethered, I was highly motivated, and I was thrust into a, a, a, a Petri dish of pure opportunity to create stuff, and that that all happened.
Thad Davis: The transition to Kindred and then ultimately the formation of Lacuna underneath that.
Brian Holzer, MD: Yeah, I mean, I, when I had ascended to the enterprise level, I mean, I became somewhat unique in that I understood both sides of an integrated delivery and financing system. Not, I mean, you know, a mile wide, an inch deep, but, but I had worked on the provider side. I had interfaced with the payer side, and I understood at least conceptually that the concepts that would be required to drive clinical transformation and the integration of that within payment design and how it all could work, having been able to see, see all of it upfront. And I just ran into the CEO of Kindred, Ben Breier at the time, and another visionary guy and aggressive. And we just connected on a personal and professional level, and I followed him really more than anything else, and, and the vision he had for, you know, sort of innovating outside of Kindred’s core operating units at the time. And we anchored on the concept of a president of innovation role where, where we would think about how to invest in businesses, create new businesses. And otherwise leverage the IP of Kindred being one of the dominant post-acute care providers and sell services and solutions into the market. And that was that role. And I, I, I ran to that. It was the right next stop for me in my career.
Thad Davis: I know Ben, I mean, he’s a pretty innovative guy to spend a lot of time with too. So, I mean, that’s again, another, another great sort of umbrella to experiment within where, I mean, Ben’s a guy kind of like makes things happen. Like, let’s do this, let’s do that. Very quick to decide, very quick to move.
Brian Holzer, MD: Yep. He worked a little too fast ’cause we had two acquisitions in my four years there. And lot of what we had discussed, just had to pivot and, and ultimately, I ended up spending my time on the creation of another business called Lacuna Health, to your question. Which was where I spent a lot of my last couple years at Kindred invested in.
Thad Davis: Yep. And then, kind of threading up to set you up a little bit. I mean, the, there’s been this sort of absorption of heavy-duty amount. You’ve seen a lot of different processes. You’ve seen a lot of different post-acute settings, and you’ve been, you know, a ramp actually, you’ve gone from a very structured Amgen scale, continuing down to the growth end of the spectrum and increasing responsibility for creation and growth and then Aware, which in and of itself is a pretty innovative model. Maybe just for one second, for the listeners here, just walk through what Aware is and kind of what, what the company is up to.
Brian Holzer, MD: Well, yeah, let’s start for how I ended up there. I mean, again, as we talk through my story, I’ve spent 10 years at this point. Sorry, but it was closer to like eight-ish years between Highmark and, and Kindred working on the concept of shifting care out of facilities into the home and the value proposition of services being delivered at home and community services really at a time, we’re just sort of even scratching the surface today on the potential of that. If I had a chance to sort of work on this before it was a thing. Kindred gets bought by LifePoint. I ultimately get pitched an opportunity to join Aware Recovery Care and what Aware Recovery Care is an in-home 12-month program delivering, treating addiction as a chronic disease and delivering a, a whole person healthcare care model for folks recovering from addiction. When I looked at it, I never even saw addiction. I saw an innovative longitudinal chronic disease program, taking a look at a condition, treating it as a chronic disease, and providing the right amount of services for the right amount of time with the right payment design already set up through our bundle payments. To me, it just so happened that the population that we were treating was those suffering from addiction. It was nothing more than a continuation in my head of everything that I had been working on. And I loved the concept of doing something for a population that had not had access to this level of care. And I found this to be so incredibly innovative that I sort of, again, ran to the opportunity to, to, succeed the founder.
Thad Davis: That’s the thing about Aware is that within the, within the addiction space, not only is it, is it actually unique to have into the home, that’s what people kind of like, into the home, no facilities, chronic care management. There are other companies not within addiction that are beginning to sort of a, a achieve this. But I mean, with Aware, I mean at this point you’re being put in the seat to drive growth of a model that is actually expanding in this regard. So, it’s actually, in around a bundle payment. Like you noted, it’s actually a highly structured payment category, uniquely contracted with each payer that you have a relationship with. I mean, this is the definition of fringe services innovation right here. I mean, it’s development of a ground game development of a payer model, development of a clinical model and maturation of that. You were, you were beginning to pursue more and more once you were kind of at Allegheny, that transition. You were there early during that transition. Kindred was pushing transition out, which is Kindred’s natural thing, and now Aware is sort of the, probably the penultimate, one of the, one of the penultimate sort of healthcare companies putting aside addiction right now in this model.
Brian Holzer, MD: I mean, what the founders did is, is nearly unheard of, you know, they, Steve Randazzo, the founder, started the company in 2011. Seven years ago, the company had 50 employees, a hundred clients operating only in Connecticut in a fee for service arrangement and think, just think about this for a second, for you and your listeners. Seven years ago, he negotiated a bundled payment arrangement with Anthem of Connecticut in behavioral health for substance use disorder. And you think about even today, how many bundle payments exist.
Thad Davis: Yeah. Saying that today is crazy, let alone seven years ago. Yeah.
Brian Holzer, MD: So, it changed the company, and we went from one state, 50 employees to over 800 employees. Now we’re in 11 states. We have a census that’s gonna exceed 2000 here shortly. Probably have 4,000 or so emissions a year. It’s bonkers. We have 16 value-based contracts with leading insurers. Anthem has continued, now Carelon has continued to support our expansion. We’re in seven states, through Anthem supporting it through a commercial bundle payment arrangement. Just amazing track to this company, and it speaks to the appetite. For these types of innovative models in the home, and unfortunately in our case, the demand, especially post Covid with regards to alcohol use disorder, we are providing a need in the market and doing it in a way that ultimately works.
Thad Davis: I think you hit on a very interesting point. This is a heavily payer linked model, so there’s a lot of support from the payers for this sort of next generation. I mean, professionally the amount of people that inquire about, Aware and sort of how are they doing that? Whycan I not do what they do? I think everybody looks outside of addiction. People look at it sort of in an envious state. A question for you, kind of putting a, kind of bringing, bringing to where you are in the current hot seat is, is the chief executive officer of Aware. I mean going from, you’ve been descending down and stripping away structure. Kind of looking at that Amgen world where it’s a, you know, a very comfortable but you know, helpful developmental program in a very large company, you’ve been pulling away and pushing away infrastructure around you, and now you’re at like the growth level where that this is the infrastructure. What are some of like some takeaways for, for folks that are listening around, like going from the, the Amgen, Allegheny, Kindred and then Aware and kind of like what have you learned about like pure growth, I guess, you know, it’s like, okay, now there’s a lot of growth going on around here, like, like in terms of management of that, especially without the super scale of another, another entity wrapped around that?
Brian Holzer, MD: I mean, you know, healthcare is hard. That’s what I’ve learned.
Thad Davis: Yeah. Yeah. That is true. Yeah. I, there’s, there’s unfortunately, a graveyard of funded companies over the last five years that have learned that the hard way. Yeah.
Brian Holzer, MD: There’s so much to that question. Ultimately at the end of the day, it’s not good enough to have a great idea. It’s not even good enough to have initial success. We’re coming out of irrational markets into very rational markets right now. Maybe we could consider them to be irrationally rational markets at this point, but,
Thad Davis: Overly, overly rational.
Brian Holzer, MD: You’re seeing sort of, I think the right expectations of fundamentals here, and I think you’re gonna see a reset on how companies go about their early years, where ultimately a little bit slower growth as a trade to truly understanding your unit economics and understanding exactly how to scale through a playbook and present that value proposition to your paying customers. In our case, insurance companies, you’re gonna see the off the, the products of the way the markets are now and how companies are set up moving forward The last 10 years or, or maybe a little bit less. It, it really has been grow at all costs and good business models got funded and bought out. And I think we’re sort of maturing as a healthcare industry around the run on the hype of digital health and, and early innovations towards the practicality of what’s the problem and let’s find a solution for it. Let’s not throw solutions and retrofit them into a problem. I think we’re in a really good spot here at Aware Recovery Care, we’ve got a lot of wind at our back, three major markets, very significant relationships with, with payers, incredible outcomes that speak the language of the way payers are looking for us to speak in terms of per member, per month reductions. But the next step is, is how, how to think about rational growth in a way that fits the way the market thinks about companies these days. That’s, that’s, that’s just an evolution that we’re in a really good spot and I think you’ve alluded to what a lot of other companies are struggling through that transition.
Thad Davis: Well, I, I, I think that transition, I mean you’re executing on a ground game, executing on an innovation, the services innovation model with a good ground game where you’re actually delivering care and scaling to deliver care, that’s not easy. It’s very difficult. Like you said, healthcare is hard, but I mean, healthcare is hard for, if you’re just delivering a digital product, let alone something that has, you know, IT backbone, ground game delivery people on, people pushing into folks’ homes. I mean, there’s not a lot of pure in-home startups going on out there, you know?
Brian Holzer, MD: What I’ve always loved about Aware is it is so ambitious, in that it’s trying to actually solve the problem. I mean, it, it, when we, we didn’t get, we didn’t get into the specifics, but we have a team of paraprofessionals, peer coaches, family educators, licensed layer, um, that’s going in. Nurses, social workers, nurse practitioners, addiction psychiatrists. We’re a 12 month, up to a 12-month program. We’re trying to, we’re in the home, and so there’s, I don’t even use the word social determinants of health. That’s a word you use when you’re not in the home. We’re in the home. I mean, we are peeling back the onion, getting to the source traumas and contributory issues. We’re not pulling someone out of their triggers. We’re addressing the triggers, and so you land on a sustainable foundation for sobriety. My frustration in healthcare over the years has been we, we play on the fringes. We try and solve very complex problems with simple words and apps and things that aren’t really gonna create a sustainable foundation. And then we tout the success in a test tube of a small number of clients or patients and extrapolate that it’s scalable and actually gonna reduce the cost of care. And so, what Aware is, forget what we actually do. It’s an ambitious attempt to control for all of the factors that would be necessary to create sustainable change. And I think what the markets are saying increasingly with all these various point solutions is that you better bring me more of a platform than a bunch of fringe point solutions. For this to, to continue to be funded and supported. And that’s, again, it’s a combination of what I, what I didn’t like about healthcare and what I loved about Aware and, and the concept of your question in terms of what have I learned? I’ve learned that platforms work. You know, hard things sometimes are better, even if they take longer. And that’s the discipline that I think healthcare is gonna need to adopt to move this forward.
MUSIC TRANSITION
Thad Davis: All right. Let’s talk about you for a second here. The charitable engagement, civic engagement. You, you’ve been involved in in several, definitely meaningful industry organizations like the Louisville Healthcare Council and a few of the things, and then you also C-Suite or in a couple of things. Can you just talk a little bit about your involvement in, in some of these sort of other activities and how important or, and what that’s provided for you?
Brian Holzer, MD: Yeah, I mean, I got three kids under 15. I got, I’m busy, but I, I like to give, I like to give back. I love anything that I can be, be sort of thrust into a mentorship role, I tend to jump at, you know, many things that aren’t even on, I don’t put on my resume or LinkedIn. It’s just opportunities to mentor business school students and such. I sign up for, I’m an interviewer for University of Pennsylvania undergrad students, unpaid. I just love interacting with the enthusiasm and excitement of someone at that stage of their life and how I can sort of impart, you know, any amount of wisdom. C Sweetener is just another example of it. It’s an organization that I really got attracted to, in terms of executives signing up to mentor high performing women and helping them think through, you know, their career opportunities. I do that and, you know, Healthcare Louisville CEO Council is something that I was involved in when I was at Kindred. A really innovative approach of, big companies in Louisville banding together for the promise of aging and innovation. And so, you know, the buckets of things I get excited about are mentorship related activities and things where I think that I can contribute from thinking differently about, you know, healthcare and innovation.
Thad Davis: My last, my last question, I know that your son golfs, et cetera. How much are you golfing these days?
Brian Holzer, MD: Very little.
Thad Davis: I was like, you have any time, you don’t have any time. You, I, I used to have a 10 handicap. Now it’s a 40 handicap. You know, it’s
Brian Holzer, MD: Yeah, my son’s 15 and a, you know, plus one handicap at this point. And I’m more happy than not just, uh, before he turns 16, drive him just tournaments and, watching him. I can no longer give him any advice. Drink your water, eat your food, otherwise, you know, do what you need to do.
Thad Davis: Yeah. Excellent. Well, uh, Brian, I really appreciate you spending time with this. This has been a great overview and super compelling, fascinating. I mean, the amount of, the amount of changes and transitions and sort of leverage that you’ve achieved through the career trajectory is just amazing. As you know, I’m, I’m personally biased on, on behalf of Aware and yourself, but, I think that as folks look into this, it’s gonna be an exciting, your leadership and delivery there is gonna be super exciting as people really understand what you’re unfurling there. I appreciate you spending the time with us.
Brian Holzer, MD: It’s been great to be on here. It’s been great to get to know you. You’re a super interesting guy. Have your own career track that’s, you should be on someone else’s podcast at some point.
Thad Davis: Yeah, I’ve, I’ve got a, my career track’s also weird, so that’s why, that’s why I appreciate, that’s why I appreciate these, the, the diversity of background discussions here. It’s like, it was like, “oh, okay, you can have a diverse background and be very successful. That’s cool.” Exactly.
Brian Holzer, MD: Thank you so much. It’s been, it’s been a lot of fun talking with you.
Thad Davis: Excellent. Thanks again, Brian.
Brian Holzer, MD: Alright, take care.
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