Brad Smith has been a leading figure within the Trump administration’s U.S. DOGE Service, directing its cost-cutting efforts at the Department of Health and Human Services, a vast agency whose charges include ensuring drugs are safe, preventing diseases from spreading, and administering health care for older, disabled, and low-income Americans.
Smith is a Tennessee native who made his fortune launching health care startups that serve poor, sick, and dying patients who rely on taxpayer funded health insurance. Along the way, former colleagues and employees say Smith operated in a manner that was cutthroat and ultimately left several leaders at one of his companies feeling like they’d gotten a raw deal.
“I do think that you don’t become so successful without being a little bit ruthless,” a former CareBridge executive said of Smith. “And while I acknowledge that, it’s never been my style to get a leg up by putting others down.”
Smith’s role as a senior adviser at HHS was always meant to be temporary, and he stepped down before Memorial Day.
This examination reveals the person at the center of DOGE’s health care cuts to be a shrewd startup founder who’s left a trail of controversy at his past firms. It’s based on interviews with more than 30 people, including Smith’s former colleagues and employees, as well as friends, family members, former classmates, and even Smith himself. They described Smith as a person singularly and unapologetically focused on hitting ambitious growth and profit targets, sometimes risking workers’ mental health or patients’ wellbeing. At one company, workers claim their jobs were to cut services for vulnerable patients, even if they felt it was unsafe. At another, workers say the company oversold its services to clients.
Most of those who spoke with STAT did so on the condition of anonymity because they said they feared Smith, with his wealth and powerful connections, could harm them professionally or pursue them legally.
[Smith] was an obvious choice to lead DOGE, and not just because he was part of Trump 1.0’s Operation Warp Speed. He’s a workhorse. His mom told STAT he’s worked upwards of 18 hours a day his whole career and has only recently started to cut back.
Several people criticized what they perceive to be conflicts of interest between Smith’s roles within the government and his ongoing work in the private sector, including running a company called Main Street Health, which sends so-called health navigators into rural clinics to help with their most complicated patients. As a special government employee, Smith was not required to divest from his companies when he took on the DOGE role, though he is still subject to conflict of interest laws.
Rep. Jake Auchincloss (D-Mass.) has been particularly vocal in calling out what he sees as Smith’s conflicts. In an interview with STAT, he said he doesn’t think it’s a coincidence that the Centers for Medicare and Medicaid Services, the agency that regulates Smith’s companies, has been spared from the worst of DOGE’s cuts.
“Both CareBridge and Main Street Health are functionally just low value, rent-seeking behavior, which is frustrating and is part of why Americans are so frustrated with health care,” Auchincloss said. “But when you couple that with his incredible degree of power over HHS, it becomes, to me, a glaring conflict of interest.”
The disconnect between Smith’s stated focus on making health care better and the external perception that money was his priority was also present during Trump’s first term. At that time, Smith headed the Center for Medicare and Medicaid Innovation….
CMMI’s work centers on what’s known as value-based care, the idea of paying providers to keep patients healthy rather than for each service they deliver. Near the end of his stint, Smith published an article in the New England Journal of Medicine highlighting, with charts, how much money the various models the agency tested were losing.
Value-based care has been around for decades and researchers have, by and large, not been able to prove that its various iterations save money, said Lawton Robert Burns, a professor of health care management at the University of Pennsylvania’s Wharton School of Business.
“They all seem like good ideas, but then when you dig into it, you say, ‘Geez, that didn’t work out the way it was supposed to,’” Burns said.
Even as Smith’s own conclusion was that value-based care, by and large, doesn’t save money, the companies he founded all hinge on that very concept: making money from saving insurers money by taking better care of their members.
Does that mean Smith’s companies have the special sauce to finally make it work? Maybe. Or maybe the people buying the services don’t know better, Burns said.
“I don’t want to say he’s selling alchemy or voodoo, but maybe the people he’s selling this stuff to don’t connect all the dots,” Burns said. “I think this stuff is just such harder work than anybody gives it credit for.”
In the months before Smith joined DOGE in January, he was busy negotiating the sale of his second company, CareBridge, to Elevance Health, one of the country’s biggest health insurers. He did so in a way that left some senior executives feeling ripped off, according to six people with knowledge of the situation, all of whom asked to remain anonymous for fear of retribution from Smith or CareBridge.
Elevance’s $2.7 billion offer for CareBridge included an unusually expansive holdback agreement, a provision where top executives get only a portion of their equity earnout at the deal’s close, and have to work at the company for several years to get the rest, the people familiar explained. Agreements like that are common in large deals, but they typically only apply to a handful of top executives. In this case, Elevance wanted to retain between 20 and 30 CareBridge leaders.
“I’d say darn near 100% of deals have some level of that, but usually it’s held to the top seven to 10 people at the company,” said Brad Haller, senior partner of mergers and acquisitions at the consultancy West Monroe, who was not involved in the CareBridge deal. “
But five people with knowledge of the situation said executives felt forced into signing the agreement. After they received the document, they said either Smith or his attorney told them if they did not sign it, they would be terminated and have their equity revoked. They said Smith sent the agreement on a Saturday and gave people until Sunday or Monday to sign it.
“You either stopped being an employee and didn’t get a dime or you signed this miserable document and got at least a small percentage of the worth,” said one of the executives who received the holdback agreement, and asked to remain anonymous. “So there was no option. In fact, some people would call it coercion.”
Lambert here: “Some people would call it coercion,” “I don’t want to say he’s selling alchemy”…. Quite the outbreak of apophasis among people discussing Smith and his business dealings.
Even at a young age, Smith was savvy about making connections with powerful people. As a high school senior, he got to know Bill Haslam, the billionaire who would eventually become Tennessee’s governor, because his kids went to Webb. Smith would later work on Haslam’s campaigns, and he’s still in his Bible study group today. His close relationship with Trump’s son-in-law, Jared Kushner, would eventually help him land a role in the first Trump administration.
[Smith’s] first company [was] an in-home palliative care provider called Aspire Health,
Health spending tends to spike in the last year of people’s lives, and the idea behind Aspire is to blunt that trend, primarily by keeping them out of hospitals.
Several former executives said the company enrolled too many patients who weren’t good fits for its service because it used a flawed algorithm to identify them. They said the company could have figured that out during initial assessments, but opted not to because it wanted to keep growing quickly.
The health insurer Anthem, now Elevance, bought Aspire for $440 million in 2018. That was a decent premium over the $195 million valuation the company earned when it last raised cash from investors two years earlier, according to PitchBook. It’s now part of Elevance’s Carelon subsidiary.
Lambert here: Back to CareBridge.
Liza Norton, a former CareBridge clinical assessor in Florida, alleged in an ongoing lawsuit filed in January that clinical assessors were required to cut caregiver hours by specific percentages, even if they felt it would harm patients. If they didn’t, Norton said they risked being fired. The main thrust of Norton’s lawsuit, a proposed class-action case, is that CareBridge failed to pay its clinical assessors overtime, even as it set high daily quotas on patient assessments.
The complaint says CareBridge pressured its clinical assessors to “abandon their duties and obligations as licensed clinical therapists and therapy assistants in favor of pumping out report or assessment one after the other” that insurers like UnitedHealthcare would use to cut their spending on home health aides for policyholders. More than 20 former clinical assessors have joined the case, which is currently paused pending mediation.
Chloe Evans, who worked there in 2022…. said she and her coworkers were micromanaged down to the minute. If employees wanted to use the bathroom outside of their breaktime, she said they were expected to dip into their 10 to 12 minutes a day of personal time.
When she broke her back caring for her young child, Evans asked if she could work remotely for two weeks. Instead, she was fired. Evans was told it was because management didn’t get her doctor’s notes for her previous doctor visits. She says she provided them.
Evans said she worked closely with Smith and CareBridge’s chief of staff at the time to go over staff metrics and assess whether employees were meeting their productivity goals. But every six weeks or so, Evans said bonus tiers would change, making it difficult for anyone to cash in. Leadership explained that’s just what working at a startup was like.
“It just kind of seems like a rinse and repeat structure that they have going on,” Evans said, “where they’ll build it, they have the same techs, they partner with the same people, they develop it, they make money, they sell it, and start over.”
In 2021, Smith launched two more companies. The first, Main Street Health, works for health insurers and takes a cut of the savings it generates, much like Aspire and CareBridge. Unlike the others, Main Street also contracts with the physicians, taking a cut of the savings from them, too.
The other company, Russell Street Ventures, is a venture capital firm that launches and scales value-based companies. Main Street was its first company.
None of Smith’s former colleagues were surprised he ended up in DOGE. Sure, he worked in the first Trump administration, but it’s more than that. The DOGE work is precisely his skillset.
Lambert here: “Carebridge.” “Main Street Health.” Never eat at a place called “Mom’s.”
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