A Learning a Day

I recently started building products focused on healthcare affordability in the US. As I was ramping up on a new space, the biggest question that sparked my curiosity was: how did we get here? This question is the inspiration for this weekly series chronicling the decisions, accidents, and breakthroughs that built the US healthcare system.

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Henry Kaiser was a construction magnate who had invested in shipyards as the demand for ships rose with World War II.

By 1942, his shipyards in Richmond, California were running around the clock. Workers poured in from across the country — 80,000 by the end of that year, over 200,000 at peak. Kaiser built housing for them, schools for their children, a credit union, and even a dedicated electric commuter train between the housing areas and the yards.

Between his Richmond and Portland shipyards alone, his teams built 1,490 ships during the war. When he noticed too many workers missing shifts due to illness, he decided it was time to build a better healthcare system for his employees.

He called Sidney Garfield — the desert doctor whose prepaid model had so captivated him at Grand Coulee — and asked him to scale it. Garfield built out a tiered system: first aid stations in the shipyards for minor injuries, a field hospital in Richmond for more serious cases, and a fully renovated hospital in Oakland for severe illness. Workers paid 7 cents a day for comprehensive coverage.

By August 1944, 92.2% of the Richmond workforce had voluntarily enrolled — the highest voluntary enrollment rate of any health plan in the country.

Kaiser didn’t stop at healthcare. In 1942 he bypassed the unions and integrated his shipyards directly, hiring Black workers and women through the US Employment Service. His hospitals followed. At a time when racial segregation in medicine was standard practice, Kaiser’s facilities treated workers of all races and genders equally.

The American Medical Association was watching all of this with alarm. Their opposition was fierce and coordinated. The prepaid model threatened everything the medical establishment had built — the traditional fee-for-service relationship, the physician as independent entrepreneur, the idea that medicine was a private transaction between doctor and patient. County and state medical societies even barred Kaiser’s doctors from existing hospital facilities.

Kaiser’s response was to build his own hospitals. If the establishment wouldn’t share their facilities, he would create his own self-contained system — with full-time doctors, nurses, and staff who believed in the same thing he did: that keeping people healthy was better medicine than treating them when sick.

Ironically, the AMA attacked it by calling this socialized medicine. Kaiser was a private sector industrialist who had chosen to build a market-based solution — employers paying for worker coverage, competition driving quality — and was now getting attacked as a socialist for it.

When the war ended and the shipyards closed, membership collapsed almost overnight — from 200,000 to 11,000. So, in July 1945, Kaiserand Garfield announced it was open to the public. The San Francisco Chronicle reported the news matter-of-factly: Kaiser’s Permanente Foundation Hospital in Oakland, built for shipyard workers, was now available to anyone who walked through the door.

Writers at the time called it “a Mayo Clinic for the common man.” Kaiser simultaneously drafted a proposal for Congress to establish a nationwide voluntary prepaid care system. While Congress ignored it, unions didn’t.

Between 1952 and 1955, membership grew to 500,000 as Kaiser partnered with labor leaders to extend coverage to unionized workers across California. The model that the AMA had tried to kill quietly became the template for a new kind of healthcare organization — one that would eventually be called a “Health Maintenance Organization”, codified into federal law by the HMO Act of 1973.

Henry Kaiser built the Hoover Dam, the Grand Coulee Dam, and the Liberty Ships that helped win the Second World War. He started an aluminum company, a steel company, and an automobile company. He was one of the most prolific industrialists in American history. But he said Kaiser Permanente was the achievement he was most proud of.

Fittingly, the shipyards are long gone and Kaiser Industries no longer exists. But the health plan he built for his workers survives — 13.1 million members, 40 hospitals, $127 billion in annual revenue, the largest nonprofit health system in America.

Change is hard. It doesn’t matter if you know you need it. It’s still hard.

The reason is simple: periods of change are periods of learning. You learn about the situation, the people involved, and yourself. And learning, real learning, is hard.

Because to learn and not to do is not to learn.

Which means learning requires changing how you operate. And changing how you operate means rewiring your brain — replacing old muscle memory with a new pattern. Literally.

That process is… hard. There’s nothing in life I’ve found to be so consistently, reliably hard.

So when change feels difficult, that’s not a sign something is wrong. It’s a sign that the real work is getting done – typically within ourselves.

Whenever you’re debating how a product or user experience should work and find yourself spinning, it’s worth going back to two questions.

Are we clear about what problem we’re solving?

Are we clear what the solution looks like from the user’s perspective?

Most confusion traces back to one of two failure modes — either we’re solving the wrong problem, or we’ve gotten so attached to what we want to build that we’ve lost sight of what the user actually needs.

For years, the Microsoft OneNote app on iPhone was solid. It wasn’t flashy. But it was a reliable hub for organizing things that worked well on desktop and mobile alike.

Over the past couple of years, it has languished. And what’s interesting is that neglected software doesn’t just stay where it was. It gets worse.

Not because the code degrades. But because the ecosystem around it changes. Apple updates its operating system. The way apps interact with the OS shifts. And the little things you took for granted in a previous version quietly stop working as well. Glitches accumulate. App switching breaks. The experience slowly erodes.

It’s a useful reminder about maintenance. It’s never heroic work. It doesn’t show up in a launch announcement or generate immediate ROI. But there’s a real cost to keeping something even as good as it used to be — and if the product matters, it’s probably worth paying that cost.

Applicable to other things in life too.

In any organization, you can play two kinds of games. Games about doing good. And games about feeling good.

Games about doing good have one currency: impact. That impact shows up as a better experience for the people you serve — and eventually, in some form, better outcomes for everyone.

Games about feeling good are games of status. Being invited to the right meetings. Having your worth recognized by the seat you have at the table. Getting the acknowledgment that soothes whatever insecurity is loudest that day.

It’s natural to want some of that. But the pull toward status games is worth watching — because I’ve seen these dynamics play out just as much in three-person organizations as in ten-thousand-person ones. The scale changes, but the game doesn’t.

The key is the ability to consistently prioritize impact over status. It’s not just that impact games drive better outcomes — though they do that. It’s that they contribute more to our happiness in the long run too.

Because status games are often stupid games.

And as the saying goes, when you play stupid games, you win stupid prizes.

After being dismantled in the playoffs by the Oklahoma Thunder, LeBron James was asked whether it was time to retire. He gave a beautiful answer.

“I think for me it’s about the process. If I can commit to still being in love with the process of showing up to the arena five and a half hours before a game to start preparing… showing up to 11 o’clock practice, I’m there at 8 o’clock preparing my body, preparing my mind. So I think for me, I’ve always been in love with the process.”

I love that one of the greatest players in the history of the game still talks about getting to work 3 hours earlier than he needs to.

His talent has always been extraordinary, but it’s this love of the process, compounded over decades, that explains the longevity.

As in basketball, so in life.

I recently started building products focused on healthcare affordability in the US. As I was ramping up on a new space, the biggest question that sparked my curiosity was: how did we get here? This question is the inspiration for this weekly series chronicling the decisions, accidents, and breakthroughs that built the US healthcare system.

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In 1933, a 27-year-old doctor named Sidney Garfield borrowed money from his father, drove out to the Mojave Desert, and built a 12-bed hospital in the sand.

He had signed a contract to provide medical care for 5,000 construction workers building the Colorado River Aqueduct — the most ambitious water project in California’s history. The nearest hospital was hours away. The work was dangerous and the desert heat was unforgiving.

Garfield’s radical belief was that a doctor’s job was to keep people healthy, not just treat them when they broke down. So, he introduced safety education, hydration protocols, annual checkups. Injury rates among his workers dropped from 27 per 100 in 1934 to 3 per 100 by 1937.

The medicine was working. But the business was not.

Insurance companies paid slowly, or didn’t pay at all. Garfield kept treating workers regardless — you couldn’t turn someone away in the middle of the desert. But the hospital was quietly going broke. He was weeks from shutting the whole thing down when an insurance executive named Harold Hatch came to see him with an idea.

Hatch proposed flipping the payment model entirely. Instead of billing after treatment, the insurance company would prepay Garfield a fixed amount per worker per day in exchange for a guarantee of care. The rate: a nickel a day per worker for work-related injuries.

The revenue stabilized immediately. With predictable income, Garfield could plan ahead, hire properly, and invest heavily in prevention. And prevention was now in his direct financial interest. A healthy worker cost him nothing. A sick one cost him everything. For the first time, a doctor’s incentives were perfectly aligned with his patients’ wellbeing.

Garfield extended the offer directly to the workers: pay an extra nickel a day from your own pocket and I’ll cover everything — work injuries, illness, your whole family. About 95% of workers signed up. The hospital thrived. And Garfield quietly proved something that would take American healthcare decades to fully absorb: keeping people well was better medicine, and better economics, than waiting for them to get sick.

When the aqueduct project ended in 1938, Garfield was preparing to go into private practice when a colleague mentioned his work to a man named Henry Kaiser — the builder behind the Hoover Dam, the Grand Coulee Dam, and soon the Liberty ships that would help supply the Allied war effort. Kaiser’s Grand Coulee workers had almost no access to medical care. He invited Garfield to come north.

When Kaiser visited Garfield’s hospital, the two men spent the whole day together talking. At the end of it Kaiser told him: “If your plan achieves even half of what you claim, it should be available to every person in this country.”

Kaiser was a builder who thought in scale. In Garfield’s prepaid model he saw something that could work far beyond a desert construction site. He was right — but neither of them could have imagined just how far it would go.

Next week: Kaiser takes Garfield’s idea to his WWII shipyards and scales it to 200,000 workers. It is a fascinating story of how a wartime health plan became the largest nonprofit health system in America.

A friend, after significant career success, found herself in rooms with some incredibly rich and successful people. She shared that the biggest learning she took away was that people are the same.

Many insecure. Many jealous. Some smart. Some thoughtful.

Their wealth and success didn’t make her any more likely to like them.

We project a lot onto success — wisdom, contentment, confidence.

But it is worth reminding ourselves that those are exactly that -> our projections.

The intent we ascribe to a person is the lens through which we view their actions.

The same behavior — a blunt comment, a last-minute change, a moment of silence — reads completely differently depending on whether we think the person means well or not.

It takes real effort to judge an action objectively. The default is to see it through the lens of the person we’ve already decided they are.

At any given moment, we can either spend time finding excuses to change or wait for the next convenient milestone to start the work.

One of these increases our odds of success by at least 10x.