Follow the Money, Follow the Power with Joanne Frederick

welcome to Mental Health Evolution, a podcast about what's changing in mental health and why it matters. I'm your host, Rachel Harrison, inviting you into honest conversations with people from all perspectives in the field. Clinicians, tech founders, investors, insurance companies, and all the folks in between. Let's explore what's working, what's not, and what's next.

Hey everyone, thank you for joining us today. My guest today, Joanne Frederick of Government Marketing Strategies, is a wealth of information. In fact, I think we're going to need to have her back to talk about more. But Joanne really digs into some of what she sees in the themes in so many structures of government and insurance. We talk about CAQH and the Data Spring rebrand. We talk about a unified CMS credentialing system. We talk about some changes happening with the military and Tricare opportunities and some of her ideas for what would cut costs and make everything a little easier for everyone in the system. So I hope you get some creative ideas for this. I hope you get some learning and understanding. I certainly did. She talks in a way that is super easy to understand and get a sense of where she sees a lot of patterns in our industry. So take a listen. I know you'll enjoy it. All right, welcome back to the Mental Health Evolution Podcast. I'm Rachel Harrison and today I am speaking with Joanne Frederick, founder and CEO of Government Market Strategies, known as GMS. Joanne has spent more than 30 years building and modernizing some of the largest government healthcare programs in the country. Medicare, Medicaid, Tricare and Veterans Health. And she has helped her clients win contracts in excess of $25 billion in that time. What makes Joanne's perspective particularly valuable for our audience is the lens that she brings. She has spent her career on the inside of systems that determine what actually reaches patients. The procurement decisions, the partnership structures, the operational design choices that most clinicians never see but feel every single day. She is a woman owned small business founder, a Harvard Business School fellow, and someone who has been integral to nearly every major Tricare procurement since 1992. We are going to talk today about something on a lot of our listeners minds. What happens when the infrastructure of healthcare, the the credentialing systems, the data platforms, the administrative backbone, starts to be owned and operated by the very payers that clinicians depend on for reimbursement. And we are going to hear from someone who has watched these structural decisions play out across decades of government contracting and has very clear ideas about what good oversight looks like and what it does not. So we like to base, you know, a lot of our conversation on this podcast around articles. The first one here is Acuity News and it's titled CAQH Rebrands as Dataspring under Payer Ownership. Many of our listeners will remember that a few weeks ago I did a solo episode about the CAQH rebrand to Dataspring. For those who missed it, here's the quick version. Caqh, the credentialing platform that nearly every insurance billing clinician uses to manage their provider information, converted from a non profit in January 2026 and became owned by a consortium of 12 of the nation's largest plans. A UnitedHealth Group executive now chairs the board. The platform decides whether a clinician is enrolled, listed in insurance directories and paid. This piece from Acuity News is the most thorough and independent analysis of that ownership shift and what it means structurally for providers. So now I want to bring in our guest. Joanna, thank you so much for being here.

Thank you so much, Rachel, for having me. It's a pleasure.

So I am really curious to hear your perspective on this. You have spent decades working inside government healthcare procurement. You understand better than probably most anyone how the structure of ownership shapes the behavior of a system. And when you look at what has happened with CAQH becoming data spring and becoming owned by the major payers, what do you see that most clinicians might be missing?

Well, I think any kind of decision or action like this is not for nothing, right? There's a strategy and a meeting behind it. If we believe the better angels of our nature, that would be for the greater good to kind of streamline the process and make sure that folks can get through these kinds of systems more quickly and more efficiently, I don't think our, our past experience has necessarily proven that out as something we can rely on, those better angels of our nature. A nonprofit to for profit conversion means that somebody sees there's money to be made out of this and there's margin opportunity entities. Publicly traded entities don't do nonprofit conversions for nothing. And there is a larger strategy behind this. I'm sure that's not entirely public and we don't know that. But rest assured that one can assume because of the nature of, you know, a for profit enterprise, and particularly one that's publicly traded, their mission is to return value to shareholders, Period. That's what the street calls for. So anytime you see something like this, which in theory, you know, really, one could say should be a governmental function. Right. All providers should to go through similar process. You know, there's upside and downside to that, but the fact that now, you know, there's profit and margin to be made off of these transactions, which all providers rely on, says to me that the cost is probably going to go up from a provider perspective and maybe with some efficiencies from a timeline perspective, I would look for those, but I think it's a, you know, slightly disturbing development.

Yeah, I think so too. In the sense that really the QH is a data culture clearinghouse. Right. That's what it's always been. So that insurance providers can see quickly and assess whether providers should be able to be on a panel or stay on a panel, all of those details, where they're located, changes in location, all those things. It makes sense that that was created for ease. So to me, it's also what is the maybe. What is the potential risk for that being owned by insurance companies? Are there. Are there going to be more advantages toward, say, MSOs that are also owned by those insurance companies to credential people faster? Are there going to be rules and restrictions as far as who you have to be or should be or can't be credentialed with? There. There are just so many questions in my mind.

I think those are all really valid questions, Rachel, and something that I would encourage the kind of community of, of physicians, et cetera, that are subject to this to pay attention to. You know, I. There are sort of one of our challenges in healthcare in this country is that there are all these little pockets and all the pockets do something. Rarely are they coordinated. And layered on top of that is the challenge that we create policy on an incremental basis in this country. And you can see why that happened, right? Well, we established Medicare and then we decided to tweak it and add policy on top. But over time, what's happened is all these incremental changes have gotten layered on top of one another. And no one, I would contend, really understands what some of these programs were meant to be or the underlying mechanism were meant to be, because it's too complex. You read legislation and policy and there are thousands of pages and, you know, it's like, how do you dig through all of that? AI helps a lot. There's great ways to do that now. So I think more insight is coming for good or bad, depending on your perspective. But this change, you know, providers need to be credentialed in order to deliver service full stop. Right. And that's an Important part of how we deliver care, we want to make sure, is consumers that when you see someone, they're qualified and they haven't been sanctioned and they've gotten all their licensure and all those kinds of stuff, that's a super important part of the way the healthcare system operates in the country. And to have that under the control of one or a small number of entities who have their own goals and objectives is disturbing, frankly.

Yeah, it does seem like a conflict of interest, potentially.

Yeah, I think so. I will have to keep an eye on it. I think, you know, the best tool that any of us have is shining a light. Right. And not letting things happen in the dark or behind a curtain. And I would encourage all the, you know, providers in the community and your listeners to start paying attention, you know, make sure they keep copies of their files, make sure they keep track of the timeline when they go for these, these sort of credentialing actions, et cetera, and pay attention and look for trends and look for, you know, anomalies between one payer or another and are things happening differently? And I think it's the power of the people and the power of the folks that are subject to these systems that can really begin to make a difference.

Yeah. Yeah, that's an interesting thought. Let me go to our next article here. So this article is from Medallion, and it's called Five Trends Shaping Payer Enrollment Medical Credentialing in 2026. This state of Payer Enrollment and Medical Credentialing survey puts out real numbers on something our listeners feel but can rarely quantify. One in five hospitals report losing more than $1 million annually due to delayed provider activation. So credentialing. Credentialing delays are not just an administrative inconvenience. They are a revenue problem, a capacity problem, and ultimately a patient access problem. So based on this, creating potential revenue loss, when you look at where these delays are coming from structurally, what do you think is actually driving this? Is it a technology problem, a process problem, or is this something deeper?

There's no excuse for it be if it is a technology problem, which I don't think is the fundamental core, but if it is, there's no excuse. We can certainly build better technology today when you think about the way all the different systems work. And as you said, you know, I've worked across Medicare and Medicaid and military Health, Tricare, Veterans Health, et cetera, each of those systems, plus commercial credential, independent of one another. So it puts such a burden on the provider community because you essentially have to go through this entire same exercise over. I've never done a poll. I'd be fascinated to, to hear like how many times in a year does a provider or provide a practice, do they have some kind of credentialing or re. Credentialing thing going on? I bet it's a lot just because of the nature of the different timings of all the programs, et cetera. That's silly. I mean to put it bluntly, we should only have to do it once, right? You're either credentialed and approved or you're not. And if you are, that should apply to any payer in any program across the nation.

Oh, I love your thought. This could make my life so much easier.

Well, as we talked about I, you know, I'll talk about the military health system and the, and the VA healthcare system right now. So those have undergone. So typically they're five to seven year contracts and the federal government will go out and buy services from a third party administrator or a payer to help administer those programs. Essentially when the beneficiary population, either tricare beneficiaries, so active duty service members, family members or veterans, which again are two completely separate systems, when those folks can't get the care they need in the bricks and mortar facilities that either belong to the military health system or the veterans system, they get referred out into the community to see the providers that we see. Both of those systems have undergone kind of a contract renewal recently or there's, the VA system's underway right now actually in a contract renewal. And the requirement of the contract from the federal government is that when you turn over those contracts you have to re credential all the providers in the contracts. And these are, you know, hundreds of thousands of providers. These are large kind of large regional or national contracts. Why, why do we have to do that? Now one could argue that the VA or the military health system wants to make sure that the providers in the network are credentialed, but they're already credentialed and they're delivering that service today. But that authorization isn't, it doesn't carry over to the new contract. So we add all this administrative cost and burden which we taxpayers pay by the way, on the east butter old contract. It puts a huge burden on the provider community. It puts a huge burden on the work that has to get done to sort of stand up and get these new contracts ready. And again, it's incredibly expensive. It's incredibly, incredibly expensive for a payer to create a provider Network of, you know, a couple hundred thousand providers by incredibly expensive, I mean sometimes north of a hundred million dollars. Wow. To go out and re contract and re credential all of these providers. There's no need. It's absurd, frankly. So one of the concepts that we're working on is GMS for specifically the military health system. But it can be, you know, shared across the federal payers, et cetera, or even broader is a concept we call FedMed, which is one national federal provider network.

Wow.

That's administered by Pick CMS. Pick the military up, it doesn't really matter. So they're evergreen contracts. You apply to the network, if you're in that network, you're eligible to see Tricare patients, veterans or Medicare if we want to extend it, et cetera. And you credential once you re credential on whatever the regular interval is, which is a fair thing to happen. And we're done. We're not paying hundreds of millions of dollars every time. As a taxpayer again, you and I pay that to do essentially what's a paperwork exercise that doesn't really add any value. So it's that kind of thing. Back to policy and incremental change and that nobody's gone, okay, wait a minute. Why are we really doing this? What's the benefit and do we have to. And too often, you know, in conversation with government agencies, which I find myself infrequently, they say, well it's in the requirement, we have to do it that way. But no one has the courage to say why and can we do it differently? You know, is where's the law, their statute that says you have to do this. Yeah. And oftentimes when you go looking for that law, it doesn't exist. And if it does exist, let's change it. We can make law here. That's the ability to do that. So that's what I see on the ground. And we all pay that price. It's frustrating.

Well, and I think when we are looking as a nation at things like Medicaid cuts and things like this, this ideas like yours here, that can be a cost savings and also an ease of labor, if you will, savings for everybody involved is it's like a win, win, win. Right. All across the board.

It really is. It is. And recently, within the last maybe two weeks, the Centers for Medicare Medicaid Services, CMS released a part of an initiative so procurement to buy services to reform the way provider directories are done across the nation. And this has been bubbling up for a couple of years. There's been some articles or some postings in the Federal Register. So provider directories are sort of another sort of symptom of this same problem. Right. So providers, too much like credentialing, have to provide their information to all the different payers that, you know, they participate with, and those payers then surface those directories to their customers, et cetera. Well, provider data is notoriously bad. Not for anyone's fault, but that we're maintaining multiple sets of the same information. And frankly, if, if any of us had to remember to update our address across 50 different systems every time something changed, we would forget one or two. And then that data that goes into those systems are sometimes shared more broadly and there's no traceability to sort of get back to the ground truth. So in some cases, like in the military health system or the veteran health system, the government comes down, big long arm of the government and says, you, contractor, must ensure your provider data is accurate at 90%. Nobody, no one, gets 90% accuracy across their data right now. And if they do, they're probably not telling you the truth. So we sort of have two things happening. We have, you know, we need to fix this problem and it's a problem. Right? No one wants to call a provider to find out their number is wrong or, God forbid, drive to someone's office and figure out they've moved. That's a terrible patient experience. We don't want that. But mandating accuracy beyond what the system can deliver today is another exercise in cost and wasted money. What people have done in the past is you add a bunch of people to a call center that calls the provider's office once a month or every other week or whatever the case is, and asks them, is your data correct? Hugely expensive for no real value. I mean, the cost benefit analysis on that is all kind of upside down, hugely expensive. Remember, go back to a network that's a couple hundred thousand providers and we're calling them all once a month to make sure that their data is accurate. It's absurd, waste of money. So back to the CMS contract. CMS has got the right idea, which is one national provider directory. We collect the data once, we make sure it's accurate once, and then we promulgate that data to anybody who needs it. That's sort of the same idea as the credentialing.

Yes.

And you know, people get fearful because they're like, oh, the government's going to take over and centralize all this work. The government itself doesn't actually do a lot of this work, they contract it out. So a lot of what we do with GMS is to make sure those contract requirements actually align with the outcome that we want. Because all too often you end up with a contract requirement like make sure your provider directory is 90% accurate, that ends up costing hundreds of millions of dollars of additional administrative costs and doesn't actually get you where you need to go anyway. So we try to do a lot of work on what's the right outcome, what's the right measure, and then how do we write those requirements such that we ultimately get the goal that we want and not some other crazy unintended consequence that costs us all time and money and frustration. Wow. So I think we should watch the CMS contract because if it's done well, it has potential to really be a good baseline on which to build all of these other pieces, including kind of a national credentialing arm that frankly probably shouldn't belong to a for profit entity that has special interest in the system. And that's, I think, a better future that we could see coming out of these kinds of initiatives.

Interesting. And so I'm, I'm thinking about really, we have CAQH as the clearinghouse of data and credentialing for commercial. This CMS could be for government. Is that include military? Are we looking at multiple different systems or is there a way to rename all of them systems?

Right, exactly. But I do not believe there's a statute that says the Veterans Administration or the Military Health Administration has to have their own credentialing system. What it says is we have to make sure the providers that deliver care to these beneficiaries are credentialed first. But oftentimes, you know, people make a leap to oh, in order to make sure they're credentialed. We have to build our own system to do it. No, you don't go use the force. Yeah. So let's again back to how do we write requirements to make sure we're getting the right outcome for the least amount of burden, administrative costs, hassle, et cetera. And that's not traditionally how government has written contracts and requirements.

Do you see a lot of openness to this way of thinking or is it sort of an uphill discussion?

You know, there's moments of hope and moments of gloom at the same time. So I do think that what we all recognize is healthcare has to change. Right. The system is not working for patients. We're spending, you know, way too much money. The eu, I was talking about the quarterly earnings of a publicly traded health entity yesterday and they. $3 billion in net profit in the quarter.

Net profit in a quarter.

That's crazy. Meantime, you know, at the same time we have all this administrative costs, premiums are going through the roof. People can't afford care. You know, there's, they're delaying treatment, they can't afford the medications. Like it's just. Is not sustainable. Something has to give. So the optimist in me says, yes, there is openness to these kinds of things. And I think it's these conversations that open the aperture on that openness. Right. We're not trying to say that uncredentialed providers should treat veterans or military or anyone. Frankly, that's not the point. No, but when the work that is mandated or by contract has to happen doesn't help us get to the outcome and costs money, time, energy, effort, stop. Right? Let's just have courage, just have a little bit of courage to stop and say, all right, let's, let's think about doing this differently. What are our options? And let's design that. And that's the stuff that gets me out of bed in the morning.

I can tell. I love your passion for this because I feel like so many providers and organizations can feel like it's. You get really stuck in the weeds on these things. Right. It can be really challenging to navigate. I could tell you so many providers who don't take Medicaid or Medicare or work with military, not because they don't have the passion to do so, but because the administrative burden is such a challenge.

It is a huge challenge and it is unnecessarily so. Right. All of these sort of bespoke unique requirements that make the system work differently than it's designed to work. It doesn't make any sense. I mean, you providers who have, you know, significant administrative staff whose sole job it is to navigate their way through all these different systems, and that really has nothing to do with, with that patient relationship in an office. It's this huge kind of industrial complex we've created around the administration of healthcare, which I frankly think is ridiculous and it's time for it to go away.

I love it. I love it. So what would you see as a better or some streamlined approaches to this? What's next?

Yeah, I think, you know, as I hearken back to the purpose of insurance, the purpose of insurance is to protect you from a catastrophic issue. Car insurance does not put gas in your car. Although I say that out loud in fear that someone car insurance company is going to Swoop in and say, we're going to pay for your gas, it doesn't pay for your oil changes, it doesn't pay to change your windshield wipers, it doesn't pay for the car wash. In health care, we've inserted an insurance company between all of those sort of transactions of daily maintenance. Right. You want to go see your primary care provider? Well, you know, how many visits are you allowed a year and what's your CO pay? And God forbid you need to be referred to something, you know, some sort of specialist or lab work. Do we need that? Do we really need that? And you look back to when I was there, right? Managed care in the 90s, when managed care sort of came along, it held a promise that we were going to create a system that would take better care of people, we would make sure they get their preventive care, et cetera, et cetera. And now it's become this beast, I think, that has, you know, outgrown its usefulness and is again so expensive and so costly and administratively burdensome to everyone in the system. Like, I don't know anyone that enjoys the healthcare system as it runs today. So again, back to courage. Why? Right, Great example. I have a dog. My dog has insurance, pet insurance through Nationwide Insurance. He had a little issue. I called him, made an appointment, I got in the next day, I took him in, they ran a couple of tests, they gave me a bill. I uploaded the bill to Nationwide Pet Insurance and I had a check in the mail for 85% of it in a week. Like that's a glorious experience. And yet we don't treat people that well. We make them fight and, you know, debate and argue and chase authorizations, et cetera, et cetera, to do something as simple as a, you know, a transaction. So not necessarily, you know, a popular fix among some, certainly not from the insurance company's perspective or the payer's perspective, but that's one option. Go back direct primary care and sort of get all this, you know, barrier, administrative barrier out of the middle of these transactions and go back to health insurance is catastrophic. So that's one idea.

Yeah, that's a good idea. We are about out of time at this point, but I would love to just see if you have something that you would like to leave our listeners with. Is there one either thought or idea or action step that you would encourage our listeners to look at regarding all of these payer and data dynamics that we've talked about today?

Ah, I think absolutely. And I think that is share, share with your community, share with your patients, share with your family members. It we again must continue to shine a light on the troublesome nature of our healthcare system in this country and why it needs to change. And we might talk about, you know, with our friends or family, there's the hassle of getting a transaction or doing something, et cetera. But I think those conversations are important. You know, look for the heroes, right, that people with courage willing to stand up and say, okay, hold on, this doesn't make any sense anymore and let's look at something different and support them because they're going to need all the help they can get.

Yes, that is very true. All right, well, awesome. Thank you so much, Joanne Frederick, for being here. I think we will definitely have your information and your organization in the show notes for people to reach out to you. And it's just been very enlightening to hear some of your ideas.

Delightful conversation, Rachel. Thank you so much for having me. I really appreciate it.

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