Epic Systems (MyChart)

The hosts introduce Epic as a rare kind of healthcare company: a large, privately held software maker with little marketing or outbound sales, no venture funding, and no acquisitions in its 47-year history. The company is known for refusing some prospective customers, holding firm on price, and requiring employees to work in person at a highly distinctive campus. Its software serves many major U.S. hospital systems, and the hosts say it has lost almost no customers. They frame founder Judith Faulkner as an unusually influential entrepreneur: despite Epic's reported scale of nearly $6 billion in revenue and more than 14,000 employees, she and her family foundation still control about half the company. Epic's stated plan is to remain private and independent, supported by a succession structure intended to preserve that direction.

The episode places Epic within a U.S. healthcare system the hosts describe as costly and administratively burdensome, with spending they estimate at 18% of GDP. Rather than attempt to explain the entire system at once, they focus on Epic's role and its rise. Their opening contrast is between the broad problems of American healthcare and the operational importance of records, billing, and coordination across institutions. The hosts' descriptions of Epic's customer retention, scale, and value are framing claims for the episode; they are not a full audit of the company's customers or financials in this excerpt.

The hosts trace Faulkner's background to a family with business and public-service influences: her father ran a local pharmacy and soda fountain, while her mother later led peace advocacy and an organization connected to the 1985 Nobel Peace Prize awarded to an international physician group. David says he found the family detail through an obituary and that Epic confirmed it. Faulkner's academic path began in mathematics; while studying at Dickinson College, she taught herself Fortran in a week for a summer role at the University of Rochester's particle-physics lab. The hosts present this as evidence of unusual aptitude, while also situating her in a period when computer science was only beginning to form as a university discipline.

Faulkner applied to mathematics PhD programs, but Stanford and the University of Wisconsin opened computer-science departments as her applications were under review and redirected her to the new programs. She chose Wisconsin, where a course called Computers in Medicine introduced her to the emerging use of computing in clinical practice. Professor Warner Slack then asked her to develop software for physician on-call schedules. The origin story is presented as a contingent sequence of opportunities: a new academic field, a university medical center with practical needs, and a programmer who could build software for them. The excerpt stops before the company itself exists, but it shows how Epic began in the overlap between computer science and hospital operations.

As Faulkner worked across departments at the University of Wisconsin Medical Center, clinicians asked her to build small applications. The requests exposed a larger problem: multiple departments saw the same patient but could not easily see what had happened elsewhere in the hospital. They wanted a longitudinal record in one database, an idea the hosts identify as the origin of Epic. Their account places this need against a paper-based system in which records were informal, difficult to standardize, and physically moved between locations. Earlier standardization efforts date back to 1912 and produced a treatment diary by 1919, but doctors had little incentive to use it and resisted rules about how to document care.

The arrival of computers in the mid-1960s made portability and structured records more plausible, while Congress created Social Security, Medicare, and Medicaid in 1965. The hosts trace employer-sponsored insurance to wartime wage controls: employers used health benefits to attract workers, and later tax treatment made those benefits advantageous to both businesses and employees. They cite insurance coverage rising from 10% of Americans in 1942 to 30% by 1946 and 80% by 1964. This history is presented as the hosts' explanation for how the U.S. system took shape, not as a full account of every policy change. Medicare and Medicaid filled gaps for older, poorer, and other eligible people, but left payment split among employers, private insurers, federal programs, and states.

Third-party payment changed the purpose of medical records. Hospitals and clinicians could no longer simply treat a patient and collect payment directly; they had to document services for insurers or government payers, often in standardized formats. The hosts argue that this created demand not only for electronic medical records but also for billing systems and reliable data flows between clinical work and reimbursement. A hospital needed to connect patient records, coding, and claims while negotiating with large payers that had greater leverage. In this framing, Epic's early opportunity came from solving an operational problem that became more pressing as the health system relied on insurers and public programs. The hosts also note the tension: documentation enables payment and auditing, but more codification can add administrative work for clinicians.

The hosts trace one early response to paper records to COSTAR, a computerized medical-record system developed at Massachusetts General Hospital. Its requirements were demanding for the era: many users needed to update records simultaneously across a health system with limited mainframe capacity. The team created MUMPS, a language with an integrated database structure designed for high-volume transactions and concurrent users. This architecture reflected clinical and billing needs at once: departments had to update shared patient records while administrators tracked claims and payments. Epic later adopted a modern descendant of MUMPS, Caché, though the hosts note that many competitors chose different technologies.