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Surgeon and health tech strategist Sarah Matt discusses her article “Why fee-for-service reform is needed.” Sarah analyzes the friction between efficient digital health tools and an outdated payment system that rewards activity over quality. She proposes replacing analog metrics like visit volume with shadow KPIs that track actual health outcomes such as time-to-resolution and preventable hospitalizations. The discussion outlines a practical strategy to utilize existing billing codes for remote patient monitoring while simultaneously gathering data to negotiate shared savings agreements. Listen to learn how clinicians can drive the transition toward a more logical health care economy.

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Transcript

Kevin Pho: Hi, and welcome to the show. Subscribe at KevinMD.com/podcast. Today we welcome Sarah Matt. She is a surgeon and health tech strategist. Today’s KevinMD article is “Why fee-for-service reform is needed.” Sarah, welcome to the show.

Sarah Matt: Thank you, Kevin. It is nice to be here.

Kevin Pho: All right, let’s start by briefly sharing your story. Then we will jump right into your KevinMD article.

Sarah Matt: I love it. To go from soup to nuts, I am a surgeon and I am a recovering surgeon. Very early in my career, I actually switched into the tech sector. I have been at several startups, mid-size places like NextGen, and then at Oracle for quite some time running their global business for cloud and helping them acquire startups.

My business is the business of health care, and my business is tech. That is where I live these days, but I still see patients. I do internal medicine charity care. I still teach at SUNY Upstate, and I just wrote a book which just came out last month. So there are a lot of good things going on right now.

Kevin Pho: And your article, “Why fee-for-service reform is needed,” what led you to write that article in the first place? Then summarize that article for those who did not get a chance to read it yet.

Sarah Matt: When we think about 2025, there has been so much going on. I think that one of the things that we are missing is how to measure what is important. That is what brought me to writing this article. When we think about the transition from fee-for-service to value-based care, there are a lot of people out there who have really big opinions.

For me, I am trying to be realistic. I know we have to live in this fee-for-service world for the time being. We cannot get around that. We have to pay bills today and we have to figure out how best to utilize the codes that exist. But at the same time, I think it limits providers and their offices in lots of different ways. One of the things I suggest in this article is twofold.

First, hack the system. Use the codes as much as you can and know how they work. This means understanding how remote patient monitoring, some of your asynchronous pieces, and telemedicine work for your kind of practice, and utilize them. At the same time, you must consider how you can collect the data to build a business case to actually bring what you are doing in your RPM program for your business, rural medicine clinic, or other entity to employers or payers.

I think this is a part where we forget that we actually have a lot of power within our organizations and within our clinics. We could collect all sorts of data, and it can be the basis for increasing revenue streams for provider offices and ultimately helping improve outcomes for patients.

Kevin Pho: You mentioned, of course, remote patient monitoring. Just for those who are not familiar with that whole segment, tell us the typical conditions offices and hospitals and clinicians are using remote patient monitoring for.

Sarah Matt: There are lots of different pieces. I would say the most popular that you will see is diabetes and then cardiac care. We have lots of folks using continuous glucose monitoring. That can be either sent to someone’s phone or to a centralized location for remote patient monitoring.

We also have lots of different cardiac conditions, everything from AFib to congestive heart failure. Some of those modalities are taking rhythms or bringing the weight of a patient back to their providers so that things can be taken care of early and proactively as opposed to making it an urgent or emergent problem instead.

Kevin Pho: And a lot of physicians aren’t aware that there are CPT codes for this type of remote patient monitoring. Right?

Sarah Matt: Absolutely. I think that is the thing. Some of these codes actually can be done by your staff, by case coordinators, and by all sorts of different parts of the ecosystem and not necessarily just by the provider.

When you look into these codes, think about the whole program. This may not be a physician’s bread and butter to think about the codes. But as a practice manager or other folks within the health care system that are dealing with billing and back office tasks, these are the things that can help make the difference between a clinic that succeeds and a clinic that has to close down.

Kevin Pho: Now, just because there is a code doesn’t mean that they will be reimbursed. So in most cases, is remote patient monitoring reimbursed by Medicare and private insurers?

Sarah Matt: For now, there are definitely certain codes that are consistently paid for. Medicare and Medicaid tend to be the first within the system to say they are going to cover this. Then the commercial payers tend to follow. If you are going to follow the dollar, look at Medicare and Medicaid first. Look at your population. Some folks do not really take care of Medicaid patients, and some folks are only commercial insurance. It really depends on the mix that you have.

As an example, if you are managing an employer’s group of employees, they are going to have a specific private payer perhaps or be self-insured. So you have to be very specific in what you are trying to bill with that specific payer.

Kevin Pho: So when practices want to transition or better incorporate these remote patient monitoring codes in their practice, tell us the type of advice that you would give practices to adopt this, implement workflows, and make this part of their normal practice.

Sarah Matt: I would say start small and start with what feels easy. If you are taking care of diabetic patients already and you are already calling them and giving them messages on the portal, you are already doing a lot of this work. Instead of doing a whole new workflow, think about where this fits into the coding system. Where could I now add billing codes to what I am already doing? I think that is where you are going to find that you are doing great work that you can actually bill for.

Kevin Pho: Let’s zoom out a bit. We are talking about sometimes that transition from fee-for-service to value-based care. It is a slow transition because there are a lot of winners and losers. When we go from fee-for-service to value-based care, tell us why some of the metrics in your article, like relative value units, discourage innovation in digital health. Talk more about that piece of the article.

Sarah Matt: I think that we have been measuring what we manage. It is easy to measure how many times Dr. Matt does this procedure. It is easy to see that we are going to add on a little addition here because it took extra time. I think we have been a little lazy in how we are measuring. It is easy to measure these things, so it makes sense.

Instead, we need to actually adjust our metrics for the technologies of 2026. We are using AI, we are using all these different asynchronous methodologies, and all these continuous technological methodologies that we were not using two, three, or five years ago. When you think about what is important to patients, maybe we should start billing for that.

Value-based care is very much about outcomes. Making that full jump is really difficult from a measurement perspective and in how people do things every day within a health care office. When we think about what is important to the patient, what are those goals that we have for our practice, for our diabetics, or for our CHF patients?

If we can think about what those goals are and what we are doing right now as a protocol, we can ask: Which parts are we billing for? Which parts are for the patient and not for something we are billing for? Where are the places where we could improve that? We might realize we are doing something, but it does not help the patient. We are cleaning everyone’s ears out because we can charge for it. Does that make sense? Is it helping anyone? For my older patients over the age of 65, they love it, so we will keep doing that. But for my 30-year-olds, why am I cleaning everybody’s ears? It does not make sense just because I can bill for it.

Kevin Pho: As a primary care physician, you are right. The current system really rewards patients coming into my office and having me see them. A lot of times outcomes do not necessarily need me to see them in person. A lot of remote tools certainly would do the job, but because of the way that physicians are incentivized and paid, we need to bring them in.

Now for those who aren’t versed in health policy, you mentioned it is very difficult to change from fee-for-service to value-based care. Sometimes you read headlines in the newspapers, and they make it sound so easy. Just do this now. Why is it so difficult? What are some of the obstacles and friction points that make it difficult to transition to a value-based care system?

Sarah Matt: Kevin, this is a short podcast, but we can talk about that all day long. Unfortunately, health care follows where the dollar is. If you cannot get reimbursed, it is really hard to get doctors’ offices and hospitals to do something because they need to keep the lights on. If we are not going to pay for a procedure or we are not going to pay for this asynchronous care, it might be good for the patient, but I cannot get paid doing it. So how can I keep my doors open?

First of all is the ability to keep the lights on. The second piece is that just like I mentioned before, it is hard to measure outcomes. You do not have a lot of control sometimes, especially if you have vulnerable populations that have a hard time getting to the doctor, are on Medicare, or are homebound. You are adding more risk when you do it that way. You can make a funnel and figure out how many procedures you are going to do this year, but it is hard to say that all your diabetics are going to decrease their hemoglobin A1c by this percentage.

Kevin Pho: So tell us the type of arguments individual physicians can make if they want to incorporate some of these digital tools into their practice. You said follow the dollar. A lot of hospital systems still want to adhere to a fee-for-service based system and maybe are a little bit more reticent to transition to some digital tools. Tell us the type of arguments that individual physicians can make to maybe change the minds of their health care administrators.

Sarah Matt: One of the things we are seeing more and more docs do is take those virtual visits. A lot of virtual visits today are absolutely reimbursed, and there are very clear guidelines on that. When you take a virtual visit, it takes a lot less time for your entire office staff to prep a patient, bring them into the room, take care of a patient, and finish their note. This is especially true with transcribing services and different kinds of software that are being utilized for actual telemedicine.

You could probably see more patients that way. I think that simple math is actually not a bad deal here. Can I see six patients instead of four in an hour? Does that change how I am getting reimbursed? Does it make it easier for me as a provider so I do not have to take as long a lunch or I am willing to stay later? How does that work for my office staff? Does it mean we have fewer no-shows, and does it mean that we have happier patients and better retention?

If you use similar metrics to what you have already, incorporate some of those small pieces. One at a time. Do not go all crazy here. Make the math work. When the dollars work, the CFO is going to say yes. When the dollars work, your practice gets to keep their lights on. When the dollars work, something is going right.

Kevin Pho: Tell us a success story or a scenario that you have encountered where a practice has successfully implemented some of these remote monitoring codes, virtual practices, or digital health tools successfully and made it financially viable. What would that look like? What would that transition look like?

Sarah Matt: It is interesting. I have a colleague who is a cardiologist in Manhattan. He trained at some of the hardest public hospitals in New York, and now he has a very concierge cardiac practice on Billionaires’ Row. I was asking him about how he was using telemedicine. He mentioned that it would have been great during his training if they had more telemedicine because his Medicare patients and his patients in some of those public hospital settings just could not get to work and then get to the doctor’s appointment. They just could not get childcare and then get to see him at the doctor’s office.

They were missing appointments because they just could not make it to the appointment. You would get a no-show. They were losing patients coming through the door. They would have openings in their schedule which they could not fill last minute. Now we have a retention issue and we have a no-show rate that is off the charts.

In his private practice now, he has the opposite side of that. He has very affluent financiers and other folks that are his patients, but he has the same problem. Getting human beings to come to an office is really hard. They have lives, they are traveling, they have work, they have kids, and they have all this stuff. He has been able to institute that since COVID, and he has found he actually has a lower no-show rate for that same population now.

This is interesting because in a concierge practice, you can really see each dollar for dollar as it comes through. A retention rate matters whether it is highly affluent patients or patients who need the most help. When you decrease the no-show rate, it means that your nurses and doctors are happier. They get to see the patients they need to see. No one misses care. When they do not come, you see them in three years with a dissected aorta or you see them in three years at an ED with some terrible thing happening because they could not make it again and again. From an outcomes perspective, this colleague of mine is seeing better outcomes, but he is also seeing that it works for patients regardless of socioeconomic status.

Kevin Pho: So specifically virtual care, isn’t it also dependent on whether Medicare and private insurers continue to cover it? From my understanding, I think Medicare had given an extension in terms of reimbursing virtual care. Do we need to keep relying on these extensions that the payers are giving us to continue virtual care?

Sarah Matt: I think that we are unfortunately at the whim of all payers because like we mentioned before, if you cannot get paid for a service, it is really hard to implement it and keep it going. However, I would say that the standard of care suggests it is good. No one is saying that telemedicine is a big problem for patient care. Is it as good as in-person? Maybe not. Is it a ton better than nothing? Absolutely.

When we think about that, it is not that it is not safe. It is that you have to make a decision for your business, for your hospital system, and for your ecosystem. You have to decide if it gets paid for or not and if you are still willing to do it. It still means you can keep patients on your census. It still means you can get people through till their next appointment. It means you do not have to send people to the ER because you had a nice asynchronous discussion with them.

Kevin Pho: We are speaking on January 1. Happy New Year. Tell us what do we have to look forward to? You are at the intersection of health tech and medicine. What do we have to look forward to in your area of health tech and medicine this year?

Sarah Matt: For me, infrastructure is key. The year 2025 showed us that AI is blasting through. From an evolutionary perspective, it certainly is, and it is not going to stop. The tech is not the hard part. It is everything else.

What we are finding now is that whether it is in deep rural environments or in lots of urban centers, we are missing the deep infrastructure necessary to make things like remote patient monitoring and telemedicine work. Whether that is putting in new fiber cables throughout rural environments or bringing 5G and satellite to new areas, we have to do it. If we cannot get the patient to us, how can we bring the care to them?

When we do not, it means that we have emergency rooms completely full. It means that people who need the care in a very emergent perspective aren’t going to have space to get into that hospital. It impacts every single person. Every person that goes to the ER because of a UTI is taking a spot that could be taken for a stroke patient. I know it is an oversimplification, but it impacts everybody. Not just your rural neighbors and not just people two blocks from you in the Bronx. It impacts everybody.

Kevin Pho: We are talking to Sarah Matt, surgeon and health tech strategist. Today’s KevinMD article is “Why fee-for-service reform is needed.” Sarah, let’s end with some take-home messages that you want to leave with the KevinMD audience.

Sarah Matt: First, it is 2026. Be curious. Second, it is all about health care access. I would suggest everyone grabs my book, The Borderless Healthcare Revolution, a national bestseller two weeks in a row in December, and visit me at DrSarahMatt.com.

Kevin Pho: Sarah, thank you so much for sharing your perspective and insight. Thanks again for coming on the show.

Sarah Matt: Thanks, Kevin. Appreciate you.