Episode #239: Cairo Murphy – Using AI to automate Insurance Verification

Dr. Eric Block: Welcome to the Stress-Free Dentist Podcast. I’m your host, Dr. Eric Block. As always, I want to inspire, entertain, and educate you on the best tools and technologies out there. My goal is to help make your practice and career more profitable, efficient, and most importantly, more enjoyable. And check out all of my nonfiction and children’s books on Amazon, and check out thestressfreedentist.com  for any upcoming events. And if you’re feeling you’re a dental professional that’s burnt out, or you just feel stuck or want to get to that next level, visit the International Academy of Dental Life Coaches or www.iadlc.com, and we’ll get you matched up with a life coach that understands dentistry. I also wanted to thank our amazing sponsor, Ekwa Marketing. They have helped me and my practice over the years to improve with SEO and website performance. And to find out how you can make your practice dominate in your area, go to www.ekwa.com/msmsfd  to book your complimentary meeting. Again, that’s www.ekwa.com/msmsfd. 

Hey everyone, welcome back to another episode, and today I’m joined by Cairo Murphy, who’s the founder and CEO of Stratus AI. Cairo, thanks so much for joining us.

Cairo Murphy: Thanks so much for having me, Eric.

Dr. Eric Block: Yeah, Cairo, uh, where, first of all, where are you Zooming in from today?

Cairo Murphy: So I’m actually in the office. Uh, we have multiple offices and we have, uh, a space right across from the Giants stadium in San Francisco. And so it’s still early morning, uh, over here. Um, but yeah, we love, uh, this office. It’s a, it’s fun to be right in the city, and we close our doors and, uh, you forget, you know, I’m from a very small town. You forget that we’re smack dab in the middle of San Francisco. If we open up these doors, you’ll hear all the sound, you’ll see, you know, you’ll hear the cars, you’ll, you’ll actually hear cheers from the stadium at times. So it’s, it’s fun.

Dr. Eric Block: And where are you originally from?

Cairo Murphy: Syracuse, Utah. So small town, you know, think maybe 7,000 people. Uh, tons of cows, um, and in a rural part of Utah.

Dr. Eric Block: Now, tell me about Stratus AI. First of all, what is Stratus AI exactly?

Cairo Murphy: Yeah. So what we do is we automate the insurance process for dental practices using AI. Our whole unique way to think about it is there are companies that will do the whole process, seemingly from end to end, but not very well. There’s a couple things that we focus on, trying to do them really, really amazing to really improve both, you know, collections, get more cash for dentists, and obviously save a lot of time for the team. Those principally are insurance verification—doing full breakdowns and doing those really well—and then actually following up on the status of denied claims and doing that part really well, which I think are the most essential parts in the RCM process.

Dr. Eric Block: So I want to get into all about Stratus AI and everything that the software and the company has to offer, but first, how did you even get involved in dentistry and serving dentists?

Cairo Murphy: Yeah, so that’s a little bit of a long story, but also, I guess, interesting. So I kind of, growing up in rural Utah, I was actually in college—I was an engineer at Brigham Young University—thinking I was gonna go live the corporate life and work for Amazon Web Services, which recently had that big outage that everyone was talking about. So I ended up meeting someone, a venture capitalist, that was actually in the startup scene. And he ended up asking me what it is I wanted to do with my life, and I wanted to be able to help people, and there’s no better way for me to do that than to get into healthcare more broadly.

And so my start actually started in Mexico. I went down to help a company that was in medical supplies arbitrage, basically selling syringes, gloves, things like that to major hospitals. And while I was down there, I realized so many Americans were coming down to Mexico—to Mexico City, Tijuana—for like nose jobs and tons of procedures. And I’m sure probably everybody, all your listeners, know this. But what I didn’t see was a formal company to actually help people come down for cheaper dental care. And so that’s actually my start.

I probably—I’m probably the enemy—or at that time, it’s like I’m bringing people down to essentially get cheaper care in Mexico and not the United States. And so I end up setting up this business, selling tons of dentists on our platform. But ultimately we failed. We were this concierge service that—it takes a really long time to build credibility and a following. And I realized that it really wasn’t the biggest pain point for people.

Like yes, I wanted to make things better for patients. Like yes, I wanted to democratize this experience of, you know, being able to get dental work done, but it really wasn’t the best way to go about it. And so I actually then decided, hey, I need to learn more about this. So I went back to Utah, in a place in American Fork, and I worked for a doctor. So I actually am sitting there at the front desk, working as an insurance coordinator. And day one I realized—that is the biggest problem. It’s not staffing, it’s not obviously trying to get people to get cheaper dental care. It’s the insurance process. Dentists lose $600,000 a year on average, every single year. And there’s so much headache around staff actually calling insurance and trying to get this information. I thought there had to be a better way. And lucky for us, AI was just coming out. I was an engineer, and the timing was right.

Dr. Eric Block: And tell me about AI. How does it actually work with Stratus?

Cairo Murphy: So, that’s a great question. Um, at the beginning it was a lot of APIs. So people are probably familiar with a lot of services—I mean, there’s a lot of competitors—pretty much everybody isn’t doing it the way that we are doing it. They’re mostly using APIs or, you know, we would call them eligibility tools or kind of web scraper tools.

We decided to take a completely different approach where we decided, hey, every single insurance company has a phone number. If we have an actual AI robot that can call into the insurance, we can be able to gather these details over the phone. And so our first hurdle—and I remember it, actually building it myself before we actually had a team, before we had this company—our first challenge was, hey, we need to be able to navigate the phone tree to get to the right person, right?

Because that’s basically what these insurance coordinators will do at the front desk—they’re hitting zero, saying “agent,” you know, getting insurance eligibility and benefits, getting that person on the phone. So that was our first hurdle: how do we get our AI on the phone?

The second part was, well, how do we get insurance to actually listen? Like, how do we—if it’s an AI robot—and one of our first concerns, and it was a complete unknown for a while, is will insurance even talk to us, right? If we’re an AI, will they just hang up and will our service not be effective?

So what we ended up having to do, a little bit cleverly, is we had to be able to call from the actual office itself. And so we ended up routing our phone number through the office or sometimes, in some cases, the area code nearby. And then we had to really work on our model. We had to have an AI that sounded human and be able to get out this information.

And then ultimately, there is a small subset of calls that will fail, and we will actually have to step in or have a human team member be able to finish out that call.

Dr. Eric Block: So you actually have a human-like sounding robot calling insurance companies to gather all the information. What’s the success rate that you’re finding? You said that occasionally you’ll have to have a human step in. How often are you able to get all the information that you need?

Cairo Murphy: So there’s only a 2% fail rate, so we’re 98% effective on our AI. There is a small amount of failure that basically results from a couple things. If it is an insurance company that’s rather difficult and they’re trying to screen for AI phone calls, it makes it a little bit harder.

Luckily, we do have the same sources that other companies have, like fax information, web portal scrapers, and then also eligibility APIs from clearinghouses. So that helps actually back-end some of our information so that our calls are much shorter. That helps.

Dr. Eric Block: And what’s the data you’re seeing on how much time this is saving the staff of a dental office?

Cairo Murphy: In some cases it’s up to 15 hours a week. It depends on how busy that office is. The general rule of thumb is people will spend anywhere between four to six hours a week on insurance verification, and then they’ll spend an additional five hours actually entering in the information into their practice management system.

So that’s another place where we decided there’s a lot of opportunity—actually automating the process of all the manual entry that has to happen within a practice management system. We would probably call that write-backs. So we do that with Open Dental, Dentrix, Eaglesoft. I mean, there are other practice management systems that we integrate with, but we do not integrate with all of them today.

Dr. Eric Block: Yeah. Another major issue is just staff. You know, what if your insurance coordinator or your staff member that knows the most about insurance leaves? What if they retire? What if they quit? You know, what if they get sick? And then you have to find someone new, train someone new. I couldn’t train a staff member how to do insurance verification. What are your thoughts there on just, you know, in general, almost like acting like another staff member?

Cairo Murphy: So it’s a huge problem. Um, there are, there, well, one, the statistics for turnover in our front, in our front desk and demo is much higher than any industry, so that’s pretty widely known. Um, but two, it’s also very specific information that needs to be learned. It’s not necessarily that it’s hard. Um, there’s a lot of nuance, and there’s a lot of, like, learned and shared knowledge across the office about how insurance works and how to best get to them and, you know, what are the proper questions to ask. Um, the really interesting piece is every single dental practice has mostly developed in isolation for the past probably 30 years, that everybody has their own insurance process, their own breakdown form, the way they like to do things. Um, and so what we’re seeing is a really big opportunity to standardize, to consolidate this information and take the pressure off of the office to have to run things perfectly, um, and be able to rely on something that is doing it better.

Cairo Murphy: And so some of our statistics, um, because I, I think we mentioned that dentists lose $600,000 a year every single year. With Stratus, we make an office at least a hundred thousand dollars a year more from the insurance process by getting more information upfront. Uh, there is just, even though it can be trained, and you know, if you were to hire me, I could sit on the phone for 40 minutes to an hour and I could ask every single question. Uh, but the, the question you would have to ask is, as a reasonable office manager, as a reasonable dentist, is like, is that what we should be doing with our time? Should I be spending all my time on the phone to get all the information and see around all the corners, or is that too much? Uh, is it too tedious to actually do?

Dr. Eric Block: Uh, it’s such a pain point. I mean, I, I couldn’t imagine being the staff that has to sit there and be stuck on hold and be treated like garbage by the insurance company and, um, jump through those hoops and, um, you know, I, it’s, this has gotta, you know, save so much time and energy and help with, you know, putting our team in a, a more important situation to, to help the patients that are there. Um, and—

Cairo Murphy: And go ahead—how they feel—sorry, Eric, I’ll jump in here. How most offices feel about this is, this is information the insurance should already be providing anyway, right? They have web portals, they do provide some information. It’s about 60% of the information. Um, but you better believe the insurance actually does have all this information in their database. They’re just not sharing it. So we bridge that gap.

Dr. Eric Block: Now, what are your words to the dental offices out there—the dentists, the office managers, the insurance coordinators—A, they’re skeptical, or B, they’re just a little bit scared of AI?

Cairo Murphy: Yeah, so this is something that I felt in 2024 was probably our largest hurdle. I feel like things are starting to change. I feel like offices are starting to more widely accept this and accept AI. There still is some skepticism in the market—people thinking that AI will actually replace them, or AI won’t make them more effective and efficient and actually valuable in their jobs.

And so for any kind of late adopters on this idea, or anybody that’s listening today that’s thinking, “Hey, is AI actually going to replace me? Is this dangerous? Should I fight against this?”—one thing I would have you consider is essentially the same way that you’re given tools in your office, like your practice management software, to make you more efficient.

That is what AI is. It’s a tool that you should use, that you definitely should be the owner of, and it makes these processes that you don’t want to do better.

And so I think AI in some industries could be dangerous. I think in our industry, the knowledge is so specific, and the domain knowledge is so important—what an office knows, how to do things. There’s this human connection piece that can never be replaced, which is the actual interfacing with the patient. And I think that’s where the industry will trend. I think a lot of the back-office tasks will become much easier. But I do think the human connection piece, the actual procedures—those will be a staying factor.

Dr. Eric Block: And what trends—just in focusing on dental insurance—what trends are you seeing?

Cairo Murphy: Yes, so there’s a couple interesting trends. One, across the RCM space, or revenue cycle management, all of the people that opted to build web portal scrapers or these eligibility tools—what we’re seeing is insurance companies are actually requiring third-party authorization or like two-factor authentication, right? They’re trying to block. And I don’t want to be the guy to say, "Hey, insurance is bad, insurance is bad," and maybe everybody probably feels this way or knows this, but the insurance company is not incentivized to work with the dental practice, right? They want to squeeze out as much money as they possibly can and to make the process as difficult as they can while looking like they aren’t.

And so we saw similar things when we first built our AI calling solution—they were trying to implement AI on their end to catch our AI. Now what we’re seeing is they’re putting up these blocks to make sure that it’s more difficult for third parties to actually help dental practices.

Luckily, Stratus is not affected by this because we chose to actually automate the phone call piece and not have to deal with the APIs as directly. But I think that trend will continue. I do think insurance will fight harder against AI and fight harder against positive change in dental practices.

We have some new and interesting things that I could probably talk about later that we think will be the eventual win.

Dr. Eric Block: Yeah, and it ultimately comes down to the dental insurance company—they want to delay, decline, downgrade, do what it takes to not pay, correct?

Cairo Murphy: Yeah, so we definitely see that.

Dr. Eric Block: And what about just AI in general? What advancements are you seeing in AI? It almost seems like, you know, every couple weeks, every month, there’s just an advancement and it’s moving so quickly.

Cairo Murphy: So the biggest piece for us is actually the voice technology. The voices are scary accurate. I remember actually being on a podcast a little over a year ago and saying something similar. I’m like, “Hey, it doesn’t sound completely human yet,” but they’re really, really great voices.

Now, the models and the voices we’re working with are essentially human. They have personality, there’s intonation, and you wouldn’t be able to distinguish if I was an AI on this call right now—you would. So that’s kind of where the tricky and interesting play on voice technology is and how it can both help us, and how that might even be a scary idea—that robots are that good.

I think for AI soliciting services, that can be really annoying—when they call customers and AI is basically robocalling you. However, in this relationship with insurance, we are actually the customer, right? The dental practice should be getting this information. And so I think it’s a perfect use case for AI.

Dr. Eric Block: Mm-hmm. Just curious—you mentioned how much time it saves staff. Does the robot have to sit there on hold as well?

Cairo Murphy: And so it does. There are insurance companies—like Anthem, Blue Cross Blue Shield is one of them—that give you code limits, right? Maybe you can only call and get five codes at a time, and then you have to call back.

So the beautiful thing about AI is AI doesn’t care, right? If it needs to sit on hold, if it needs to take hours to get that information, or even make multiple phone calls—like five or six phone calls—the AI doesn’t care. And we’re able to kind of obfuscate and hide that whole process from the office.

From the office end, we’re actually running everything on auto. It just shows up in their practice management system. And the big thing is they didn’t have to do anything—they just had to turn it on.

Dr. Eric Block: That’s awesome. Yeah, the AI doesn’t go to the bathroom. It doesn’t need coffee. It’s not checking their phone. It’s just on.

Cairo Murphy: And if you know, an insurance company’s rude to our AI, our AI doesn’t have a bad day.

Dr. Eric Block: That’s amazing. All right. And you mentioned briefly about what’s coming up with Stratus. Tell me some new things that are on the horizon.

Cairo Murphy: Yeah, so we just released a new product, um, Eric, so I’m glad you asked. Um, and it was a very similar problem and, uh, similar technology. So we first built, built our AI for insurance verification to, to verify all the information. Um, the, the second piece that was very natural that our customers asked us about was, well, what about when we do get denied claims? Like, we have to call, we have to bug the insurance. Typically it’s three phone calls we have to do before we actually get paid on, uh, denying claims that have been sitting for over 30 days. Sometimes they sit for 30, 60, even 120-plus days without ever being collected. And this is actually money on the table for the practice. It’s money on the table for the dentist. And so, uh, we utilize that same technology, uh, to actually bug the insurance company and, uh, collect the denial reason and then get this resolved.

Cairo Murphy: And so what it’s working as for us is a really, really great, um, feedback loop where we can actually say, hey, with our insurance verification, we’re actually better than our competitors because we actually see that, you know, our claim approval rate—we are submitting clean claims—and, you know, are denied… the offices that use us have less denied claims. And when they do have denied claims, um, that that’s something that, you know, we, we are handling. Um, there’s, there’s definitely opportunities out there to continue to expand across the RCM stack. We’re definitely more interested in how do we make more money for the practice, and how do we save more time for the office.

Dr. Eric Block: And any chance that you’re gonna get involved with medical insurance? We, you know, my office, we, we started doing sleep apnea treatments a few years ago, and so we’re, we’re dealing with, um, insurance verification with, um, medical insurance. Um, any, any possibilities that you’re gonna be going into that avenue as well?

Cairo Murphy: So the beautiful thing about AI and about the way that we’ve built robots to make these calls is we can program the AI to ask any question to the insurance company that we need to. So, uh, we even do, um, codes for sleep apnea today, right? We, we have called, uh, for any medical-dental hybrid, um, offices. Uh, even us expanding outside of dentistry is on the table for us to go into optometry, for example, is, is on the table. Uh, we’re mostly interested in dental just because we think, um, there’s such a large opportunity, uh, where dentists have been neglected for so long and they, they don’t know what good insurance, uh, software looks like. They’re very used to just outsourcing it, right? To a company that will, you know, run it in the Philippines or India. Um, and some people are fine with that.

Cairo Murphy: Some people are fine with just using, like, clearing houses and, uh, basically getting nickeled and dimed all the way through until their retirement. Uh, and so I, I think more and more people, uh, are, are realizing that AI can be used for these use cases. Uh, there’s a couple more opportunities that are interesting around actually payments. So there’s, you know, if we’re actually able to do things very accurately, uh, we can actually make sure that we’re able to collect not only from patients, but that we’re actually able to collect from the insurance company. So where the doctor maybe used to be paid 80% of the time, you know, we can actually bump that number and boost it to 90% and start to take some of the risk on ourselves.

Dr. Eric Block: That’s awesome. And you, you’re helping the dentist to get paid for the, the work that they did. And, um, that’s awesome. And you’re really hitting on a major, major pain point. Um, Cairo, let’s, let’s wrap up with a couple final questions. Number one, how do we find out more about Stratus? Um, you can leave a, a phone number, email, website, whatever you wanna leave.

Cairo Murphy: Great. So, uh, our website’s usestratus.com . Um, there, there we have a team of, uh, AEs and sales, uh, specialists that you can just book, um, right from the website. Um, and you can join the many dentists that reach out to us every single day, uh, to, to find out more.

Dr. Eric Block: That’s awesome. And let’s wrap up with a final question. What advice would you give to the, to the young dentists out there?

Cairo Murphy: This is, this is a great question ’cause I am young myself. Um, ’cause I started this right outta college. Um, something that I think about is the rate of change, uh, is increasing every single year. And technology—there’s some things that, that stay consistent in dentistry—um, but, but there’s a lot of growth right now in technology. I think one thing that I would urge young dentists to think about is how do we apply new technologies in every aspect of our office, um, that will make them more successful when they look ahead in five years—that they were the early adopters, that they were able to figure out, uh, the nuances between vendors and be able to apply technology very quickly. I think the, the general dentist, um, historically has been probably slow to adopt technology. Like if you think about the cloud, for example, um, the cloud practice management systems just weren’t very good and people were trained to be slow adopters.

Cairo Murphy: I would urge young people that AI is different in that it can run in a headless way, in an agentic way that runs in the background. Um, and that the promises actually are real on, on some of the, the ROI and benefits. And so I would say learn as much as you can. Um, you don’t have to go get a degree. I mean, you already went through school and you spent so much time. Um, but there’s so much reading out there, uh, now that you can do on, on new models that you can actually be informed when you have conversations with vendors and what to actually look for. Or some people are marketing as AI, and you realize it’s just a, it’s just a wrapper. It’s not, it’s not a tool, um, that will actually increase, uh, the ROI of an office by 20%. And there’s other people who are really building the deep tech necessary, um, to do that. And so I would, I would try to jump in with the companies that—um, I mean there’s, there’s a couple, right? There’s a couple, um, imaging companies that have done interesting things in AI. Uh, there’s now scheduling, um, services, and, uh, so there’s a lot of opportunities popping up. And I, I, I think there will probably be a, a day when everyone is touching AI in some way in the office. Hygiene, um, you know, assistants will be doing it. Um, and so I would just learn as, as much as you can.

Dr. Eric Block: That’s great advice. All right. Cairo Murphy, thank you so much for joining us.

Cairo Murphy: Awesome. Thank you so much, Eric, for having me.

Dr. Eric Block: Thanks again for listening to the Stress Free Dentist Podcast. And don’t hesitate to get in touch with me at thestressfreedentist.com.  And if you haven’t already, please subscribe on your favorite platform and leave us a review. Until the next episode, I’m Dr. Eric Block, the Stress Free Dentist.