Weekly Health Tech Reads 8/24/25

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HOSPITALS

Fortune highlights NYU Langone’s turnaround over the past two decades

This was a fascinating read on the growth of NYU Langone over the last two decades, architected by CEO Robert Grossman and board Chair Ken Langone. Since Grossman took the helm as CEO in 2007, NYU Langone has grown from $2 billion of revenue to $14 billion of revenue, with the growth attributed here to a strong operating culture.

It’s an interesting read about how the organization transformed — in his early days as leader, Grossman fired most the existing management team, a day known as “Black Wednesday” at the institution. He also replaced a newly installed $35 million EMR with Epic. And he embarked on a strategy of building a network of outpatient facilities, versus the more typical approach of acquiring more hospitals. Early in his tenure as CEO, Grossman created a data dashboard that tracks 800 metrics across the system. A maniacal focus on that dashboard and tracking performance in general appears to permeate the system.

For the last set of financials reported, NYU Langone Health recorded an overall operating margin of 3.2% on revenue of $11.4 billion over the nine months ended May 31, 2025. Within that operating margin, its hospitals generated 7.6% operating margin, while the medical school generated a 5.1% operating loss.

I can’t help but read this article and think about what an article like this says about other health systems. Certainly, having folks like Ken Langone donating hundreds of millions to the system over the years can’t hurt. But moreso, it reads like a story of a leader who happened to be both a clinician and a good business operator. The turnaround narrative seems centered around having a clear vision and managing against that vision by managing the hospitals like a business.

We talk so often about the challenges hospital face in terms of their margins, but I am also reminded of this chart from the folks at Advisory Board earlier this year, highlighting that some hospitals are actually performing quite well. If I’m looking at the chart below and financials above right, it would appear that NYU Langone’s hospitals are operating essentially at the median hospital operating margin.

MEDICARE ADVANTAGE

The Villages Health Chapter 11 case gets more interesting as BCBS FL and UHG file objections

The Villages Health (TVH), which filed for Chapter 11 bankruptcy on July 3rd after disclosing $360 million in overpayments from CMS for upcoding Medicare Advantage patients, is facing objections from UnitedHealth Group and Blue Cross Blue Shield of FL in its bankruptcy case.

UHG filed its first objection to the Chapter 11 process in late July, questioning why the sale process to CenterWell was being pushed through so hastily, particularly given TVH has no immediate financial issue other than the potential CMS claim, which is still in the settlement process. UHG’s objection noted the proposed sale has “every possible flashing red light”, given the rush to push through a sale, insider ownership, and history of corporate misbehavior. Notably, it appears that TVH’s bankers did not reach out to any other parties other than CenterWell in this process, and UHG was blindsided by the bankruptcy filing. UHG noted in its filing that it views all of this as particularly unusual given UHC is one of the largest insurers working with TVH and also has a close relationship with The Villages, including a perpetual exclusive marketing arrangement for UHC to underwrite Medicare Advantage plans with The Villages branding.

UHG then followed up with another filing last week, noting that it offered to lend TVH money on better terms than the insider-led financing option on the table, and that TVH’s representatives essentially didn’t even respond to the offer. TVH argued separately that UHG is withholding payments from TVH during the process, which caused its financing need to increase. In these follow-up filings, UHG explicitly called out the Morse family, the billionaire family that developed and owns The Villages, for taking a substantial portion of $183 million in payments out of TVH between 2022 and 2024.

While UHG’s objection questioned the sale process on the whole, Florida Blue’s objection focused more specifically on potential overpayments. After TVH initially disclosed the upcoding issue, Florida Blue apparently did an internal investigation and found that in 2024, TVH billed Florida Blue for $8 million in overpayments by falsely adding two diagnosis codes for patients. Florida Blue estimated based on this that it was over billed by $25 million between 2020 and 2024. It’s not immediately clear to me from the filings why both Florida Blue (and presumably other payers) and CMS would have claims against TVH in this case — it seems like double counting. But I can see why Florida Blue would want to recover those dollars

It all underscores a complicated legal process that is playing out, with at least some general sense of malfeasance on the part of the Morse family given the unanswered questions posed about the manufactured sense of urgency here. It is a bit hard to read in the legal filings about how much of this process is being driven by the pretense of continuity of care — i.e. TVH’s main rationale for expediting the sale process is to complete it before Open Enrollment starts, while UHG notes that if TVH were really concerned about continuity of care, it would have provided more notice of this process and sale.

It seems unlikely to me that continuity of care is the primary motivator for TVH in moving quickly here. As the conversation around upcoding and Medicare Advantage payments heads up in DC this fall, the case here provides a good under-the-hood view of the mechanics of what’s been happening in the market and where risk adjustment dollars have been flowing. It doesn’t quite fit the prevailing narrative given this is a provider group that has made hundreds of millions via upcoding with payers claiming they’ve been duped, but it seems indicative of the fact that upcoding may not only be an issue with payers but also provider orgs.

Vice President, Network Development at Medical Home Network, a network of Federally Qualified Health Centers (FQHCs). Learn more
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