▶ 0:17:33To order. Welcome to the committee on the budget hearing on skyrocketing health care costs. I think we can all agree on that, I hope. Um, even if we have different views on how to address it. But the skyrocketing cost of health care, their impact not only on working families in our country, but on america's fiscal future, uh, was which is central to our mission as the budget committee and all of our concerns about
▶ 0:18:03The unsustainable fiscal path that this our great nation is, is on. Today, we'll hear from a panel of expert witnesses who I would like to briefly welcome and mentioned by name doctor benedict ippolito, senior fellow in economic policy studies at the american enterprise institute. Mr. avik roy, co-founder and chairman of the foundation for research on equal opportunity. And my friend Mr. joe white, president of the council for affordable health coverage.
▶ 0:18:33And uh, our democrat witness, Mrs. renee bumbry graves, a member of the service employees international union and home care worker. We appreciate you all being here. And thank you for lending your time and your insights, uh, on this important topic, um, before we begin our opening statements, I'd like to wish a happy birthday to Mr. addison mcdowell, who's not here. I hear he turned 23 today.
▶ 0:19:01Uh, I don't know what the rules are for eligibility for congress, but we may need to open up yet another investigation. Um, 25. Yeah, yeah. So I don't believe he's 25. Um, so let me go ahead and kick this off with some opening remarks. Uh, sort of off the cuff here.
▶ 0:19:27I think most of the time in addressing the big challenges facing our country, both democrats and republicans can agree. I think certainly we do about the increasing, uh, unsustainable cost of health care. The the difference comes in how to address this.
▶ 0:19:51But we have a fifth of the economy in health care, uh, expenditures, about 6 trillion, almost $6 trillion, half of which, by the way, is now, uh, government expenditures. Um, I think in the 80s, it was 70% private, 30% government. Today it's 5050.
▶ 0:20:15Um, a third if you exclude interest payments of the federal budget is health care expenditures. And, um, look, back in 1975, jimmy, we were spending $19 billion on health care as a nation. And today it's almost 2,000,000,000,000 in 10 years. That will double.
▶ 0:20:38And while demographics is certainly one of the, uh, mathematic inputs and factors in the cost, um, it's not the only reason that, um, health care inflation is running away from our families, from, uh, young families, middle class families, and beginning to squeeze national priorities like defense and others and drive up a debt that is now, as
▶ 0:21:09A percentage of our economic output, greater than we were in, uh, during world war two and the aftermath. So to have world war levels of debt, uh, and pandemic levels of deficits in relative peace and prosperity is is unsustainable and should be unacceptable, quite frankly, to to uh, the leaders that, uh, representing all parts of this country on this committee, um, I'll try to be an equal opportunity criticizer.
▶ 0:21:37Um, for the democrats part, my colleagues, uh, on the left, um, they've gone all in with, uh, government run health care. I think the poster child for, quote, affordable health care was obamacare.
▶ 0:21:55I hope after living with that for 15 years, we can all agree that more subsidies, regulations and mandates, that's not the solution. And and simply having health insurance coverage isn't the solution for affordability for, uh, working families across this great nation.
▶ 0:22:19Um, we've seen deductibles and premiums both double since the advent of obamacare. I was very disappointed. And, uh, that 17 of my republican colleagues joined the democrats to extend what was supposed to be a covid era expansion of obamacare. And it was, according to all the watchdog groups, riddled with waste, fraud and abuse. So that was a big disappointment.
▶ 0:22:48Um, but on the part of republicans, I don't think we do enough. We do more criticizing of my democrat colleagues and their failed central planning of the health care economy than to not just offer on paper, we've gotten pretty good at that, but to execute on the market based reforms and free market policies that would, in fact, um, result in better value for
▶ 0:23:21Not only the patients and families who are paying for this, but for taxpayers and for future taxpayers. Um, so I hope that with reconciliation 2.0 being a serious consideration, that we wouldn't let this historic moment, uh, pass us by without endeavoring to to fix what is broken.
▶ 0:23:46And while we reduce taxes and the tax burden on our fellow americans, and while we reduce spending by twice the amount we've ever reduced spending $1.6 trillion, and we're seeing results in terms of economic traction. Wages are up, interest in inflation down, etc. I still think the biggest tax on our families and on our small businesses is the cost of health care.
▶ 0:24:13Um, so, um, I hope we can also in this back and forth, there's always the obligatory we think obamacare was a failed experiment. They'll have their obligatory political partizan comments. I hope we can talk about the delivery of care and the runaway cost to just the delivery, not the obamacare market, not the private insurance market, but delivery of care in general. Site neutral pbms.
▶ 0:24:42There are plenty of big plays to run that I think there is common ground that would make a real difference. I don't want more piecemeal from republicans. I don't want more half measures from republicans. Too little, too late. I want I want bold action in this historic, uh, time because I'm not sure we'll get the opportunity again. If we can work with democrats, we should.
▶ 0:25:10And if they won't or we can't, uh, we should have the courage to go it alone and do the things that we know are going to yield the outcomes that are so desperately needed. With that, I yield to my ranking member. Well, thank you, uh, Mr. chairman, I thank in advance the witnesses for taking the time to to be here today.
▶ 0:25:33Um, when I first heard that my republican friends were holding a hearing on health care, I replied, no, really? What's the subject of the hearing? Because I was shocked. This is the crowd that just passed a bill to take away health care from more than 15 million americans, and now they want to have a hearing. Geez, we should talk about the problems in health care.
▶ 0:26:03Do you remember something called the big beautiful bill? We have a president who gave it that absurd name, kept talking about it, kept bragging about his so-called big beautiful bill. Well, beauty is really in the eye of the beholder. It was a beautiful bill.
▶ 0:26:22If you're a billionaire, if you're in the top 1%, $5.3 trillion worth of tax cuts, mostly going to the richest americans, how is it paid for the largest health care cuts in american history? Approximately $1 trillion of health care cut in the big beautiful bill.
▶ 0:26:48Most of those cuts are to the medicaid program. About 10 million americans currently on medicaid will lose their health care beginning december 1st of this year, when those cuts kick in. Another 5 million americans who currently have their health care through an obamacare exchange will also lose it because of those cuts that have now begun to take effect.
▶ 0:27:13In total, more than 15 million americans will lose their health care as a result of the trump republican big beautiful bill. And as draconian as those health care cuts are, they still don't even pay for all or even a majority of the tax cuts.
▶ 0:27:39The rest that spending, the bill that was passed by the republican majority last year, the single biggest increase in debt in american history, then they have the nerve to turn around and say, my god, we have a debt problem. We should probably do something about it. Give me a break. But back to the 15 million americans who are going to lose their health care as a result of their bill. I want to be clear. That's not my number.
▶ 0:28:08That's not from any democratic source or democrat source, as the folks on the other side constantly label us. That's from the official projection of the congressional budget office, the cbo. So there is no dispute whatsoever that millions and millions of americans are about to lose their health care. Millions more will be paying more.
▶ 0:28:32The average increase coming from the commonwealth of pennsylvania, the average increase for those on the obamacare exchange in my state, 102%. So overnight, a family that was paying $700 a month, now paying 1400 for some, that's just becomes unsustainable and unaffordable. And so they drop coverage altogether.
▶ 0:29:00Now you might think, well, I'm not on medicaid, I'm not on medicare, I'm not on obamacare. Those cuts don't affect me. Some 170 million or so get their health insurance through an employer provided plan. They might think that they're fine. Next time you go to the er, and there are people ahead of you who are in that er because they don't have health care and they don't go to a primary care physician.
▶ 0:29:28So they got really sick and are now showing up at the er that's impacting you. The health system in your area, especially if you're in a rural area that is cutting back on services in order to absorb these cuts, that's affecting your health care.
▶ 0:29:49Make no mistake about it, every single american family will be hurt as a result of the greatest health care cuts in american history, not even during the great depression did 15 million americans lose their health care coverage. But thanks to president trump and this republican majority, they're about to make history. With that number of americans losing it.
▶ 0:30:19I'll wrap up with this, or at least wrap up for now. Donald trump, after being on the political scene for ten years, has a great health care plan. Maybe you've seen it last year, talked about concepts of a plan. Now he has a great health care plan. Just don't get sick. Problem solved. Tax cuts for the rich, healthcare cuts for everyone else. Mr.
▶ 0:30:48President, how about instead of giving the american people greenland, we give them health care? With that, I yield back. I thank the gentleman, uh, and would like to, uh. Remind people, in the interest of time, if there are any members who have opening statements, they can submit them for the record, I'll hold the record open to the end of the day to accommodate those members who may not have yet prepared written statements.
▶ 0:31:17Again, thank you to the witnesses for your time today. The committee has received your written statements and they will be made part of the formal record. Uh, you will each have five minutes to deliver your oral remarks. We'll start with you, doctor ippolito. Well, thank you very much. Chairman and ranking member boyle. Members of the committee. My name is ben ippolito. I'm an economist at the american enterprise institute, where much of my research and policy work focuses on the issues of health care costs. I think this is a very interesting time to have this hearing.
▶ 0:31:45Obviously, with healthcare spending now exceeding $5 trillion, the absolute levels are enormous, and they create significant problems for policymakers like yourself. They also create problems for households. That said, um, it's it's following we're following on the toes of what could be viewed as somewhat of a success for the last 15 years or so.
▶ 0:32:05And I say that because while healthcare spending is very high, it has at least held steady as a portion of gdp between 17, 17.5% of gdp. Um, obviously that is a very high level. Um, but by our standards, holding steady is a pretty good outcome. I say that because things may be changing. So just last week, data were released that showed that healthcare expenditures in 2024 grew at 7.2%.
▶ 0:32:32That's the second year in a row of over 7% growth that is faster than inflation. That's faster than economic output. That is by no measure sustainable in the long run. Uh, for your context, data suggest that increase in spending was mostly driven by greater use of services and more intense use of services, rather than just prices increasing across the board.
▶ 0:32:54Part of the reason that that is such a problem for the federal government was already mentioned is that the federal government keeps absorbing a larger share of that total spending. So in the late 80s, the federal government covered a third of total health expenditures. Today, it's 50%. That's the federal government is absorbing a larger share of a growing pie that creates huge, huge budget pressures. That is partly because the population gets older, so you get more people in medicare.
▶ 0:33:20But a lot of that is because federal policies that have recently been acted like the medicaid expansion or the affordable care act individual marketplace rely very, very heavily on open ended federal subsidies. That is a recipe for ever increasing federal spending. All told, the federal government's support for healthcare, including programs like medicare and medicaid, but also tax exemptions for for employer based coverage, are now over $2 trillion a year. That's well above social security.
▶ 0:33:47Uh, that is way above national defense spending. The other two biggest categories looking forward, cbo, as you well know, expects federal outlays to steadily grow and exceed revenue coming into the government. The federal health programs, particularly medicare, are expected to account for the biggest share of that increase outside of interest payments.
▶ 0:34:11So I say all of that to make the basic point that given where we are at at over $5 trillion a year at now 18% of gdp being spent on healthcare, further increasing rates of of spending growth are a major, major problem at this point. Um, none of that justifies, I would say, indiscriminate cuts to healthcare. And I don't actually think anybody here would support that.
▶ 0:34:36Um, lots of healthcare spending is very, very valuable, but some of it is not. And the key question for you all is to try and think about areas where federal health spending is not tightly tied to value that beneficiaries or individuals are actually receiving. Fortunately, if you spend $5 trillion a year, there happen to be quite a few opportunities to find those instances. I'll highlight just a couple in medicare because it's such an important part of the federal budget.
▶ 0:35:03Um, traditional medicare, for example, does a really poor job of constraining the use of even really low value healthcare. We see for decades we have seen huge variation across the country in low value spending. That's a great area to try and target. If we can tighten up that spending, there's a much, much smaller trade off for what beneficiaries are receiving. The same thing goes for medicare advantage. Medicare advantage does a lot of things well, but there's evidence that suggests strategic behavior by insurers tends to increase the payments they get.
▶ 0:35:33And that last dollar we're sending to medicare advantage insurers translates to a modest benefit for beneficiaries. That's another great place where you save money, but you're not giving up as much. So those are conceptual ideas. Um, within medicare, I'm sure the rest of the panel is going to highlight a host of other options for you all to consider. Um, but I'll conclude by simply saying this is a very important time to refocus on this issue.
▶ 0:35:56We have had unusually fast cost growth over the last couple of years, and if that continues, is going to create a very, very big problem for you all. Thank you, Mr. ippolito. Five minutes. Mr. roy. Doctor. Roy. Mr. roy, doctor. Roy, whatever. He you know Mr. roy's expert. Roy. Chairman arrington and ranking member boyle and members of the committee. It's a pleasure to testify before you on this critical topic.
▶ 0:36:25The foundation for research on equal opportunity, or free op for short, is a nonpartisan think tank dedicated to improving the lives of americans on the bottom half of the economic ladder using freedom, innovation and pluralism. A big part of why we founded free op is because we understood how important it is to achieve long term fiscal sustainability through entitlement reform in a way that protects the vulnerable and expands opportunity for low income populations.
▶ 0:36:52As you all know, the only realistic way to reduce the deficit and the debt absent default is to reduce the growth of federal health care spending. And you also all know that us health care is the costliest in the world. But you might not know that the us subsidizes health care at a far higher level than do other industrialized nations.
▶ 0:37:14Indeed, in 2022, government subsidies of us health care, including medicare, medicaid and the aca, and the exclusion from taxation of employer sponsored coverage reached $7,438 per capita on a purchasing power parity adjusted basis, compared to a median of 3144 in 32 nations with the highest gross domestic product per capita and population over 5,000,007 438 versus 3144 in subsidies.
▶ 0:37:41Each year, my organization produces the most comprehensive assessment of the performance of us health care in comparison to those 31 other nations. We call it the world index of healthcare innovation. Or why? In the 2024 wehi survey, the us ranked seventh overall, first in science and technology, but dead last in fiscal sustainability.
▶ 0:38:04On more detailed measures, we ranked 22nd on disease prevention and last on affordability of health coverage. Many theories have been offered as to why american health care is so expensive. Almost all of them are wrong. Some argue that the us has a quote unquote free market health care system, and that's why american health care is so expensive. But as the chairman noted, nearly half of us health care spending is government spending.
▶ 0:38:29Furthermore, there nations with health care systems more free market oriented than america's, like switzerland and ireland, with lower costs and better outcomes than ours. In the wehi survey, switzerland and ireland rank sixth and first, respectively, on disease prevention. The single biggest driver of us health care costs. The original sin of us health care turns out to be the decision in the mid 20th century to exclude the value of employer sponsored health insurance from all taxation.
▶ 0:38:57The problem is not that americans experience third party payment for health care services through insurance. That happens all around the world. The problem is that americans experience third party payment of insurance, that is to say, third party payment of third party payment of health care effectively ninth party health care on an after tax basis for every dollar worker receives in wages. The same dollar used for employer sponsored health insurance is worth $1.51 over eight decades.
▶ 0:39:24This massive tax subsidy has driven american health care prices skyward. Workers have no transparency into how rising health care prices depress their wages. Employers and insurers have little incentive to control costs, and we constantly demand that more services be covered by health insurance in a way we would never demand if car insurance or homeowner's insurance, because of the tax subsidy, we could fix these problems and many others to boot, by using the swiss model as a vision for a freer, healthier and more fiscally
▶ 0:39:55Sustainable system. Switzerland has universal coverage, but there are no government insurers. Everyone individually buys their own private sector plan and takes it from job to job, independent of their employers. The swiss system has many similarities to medicare advantage and the aca's insurance marketplaces, but there are also some useful differences. I'm happy to discuss these during the q&a session. I appreciate that the hot topic of the moment, as Mr. boyle mentioned, is what to do about obamacare.
▶ 0:40:21I've been writing since 2010 in great detail why the aca is flawed. Design would lead to higher premiums, not lower ones. I'm very sorry to have been proven right. Silver premiums have nearly tripled, and deductibles have more than doubled since the law went into effect in 2014. But it's not enough to criticize obamacare. There is no future for free market health care without a vibrant, affordable market for individually purchased insurance.
▶ 0:40:48The good news is there are bipartisan ways to reduce obamacare's underlying premiums before subsidies are taken into account. Obamacare made coverage unaffordable for the young and the healthy uninsured, driving them out of the market and raising premiums for all those who remain. We can fix these problems with 5 to 1 age bands, reinsurance, and other tools I describe in my written testimony.
▶ 0:41:08Most importantly, by making individually purchased insurance affordable again, we can migrate federal workers, able bodied medicaid enrollees, and those with employer sponsored coverage to higher quality insurance, while also reducing federal spending by hundreds of billions of dollars. I'm eager to work with any and all members of congress from both parties to bring these ideas to fruition. Thank you. Thank you, Mr. roy. We now yield five minutes to Mr. joe white. Chairman.
▶ 0:41:37Arrington, ranking member. Boyle, members of the committee. Thanks for having me to testify today. I'm joel white. I lead the council for affordable health coverage. Um, and I'm here to say the cost of health care is a threat to our economy. It is an escalating burden on families and businesses. It is a ticking time bomb for the federal budget and is unsustainable for the united states of america.
▶ 0:42:03These words were true in 2009 when president obama said them, and they're far more urgent today. The big reason is we've empowered large insurance companies and big hospitals to get bigger. They have wielded market power to make health care less affordable, less competitive and less responsive to consumers. Families are paying more and getting less. Today, the average family premium is $20,000 a year, or about 20% of the family's budget.
▶ 0:42:32If current trends persist in the next six years, that family will pay 40% of their income just on premiums. That is not sustainable for families and is not sustainable for the federal budget. So why are costs rising? After president obama sounded the alarm, congress enacted two major laws the affordable care act and the inflation reduction act.
▶ 0:42:56Together, they replaced market competition with mandates, administrative pricing and regulatory complexity. Those policies rewarded size and compliance, not value or efficiency. And they triggered massive consolidation in markets, large insurers and hospital systems responded exactly as the incentives encouraged. They got bigger, they gained market power and they raised prices.
▶ 0:43:26Today, right now, 97% of hospital and medicare plan markets are uncompetitive. In those markets. Prices are higher by about 30%, and those inflated prices are baked directly into premiums and out-of-pocket costs. Federal subsidies then lock those prices in, guaranteeing that taxpayers pay more every year. These policies also displaced millions of americans from private coverage.
▶ 0:43:53More than 10 million people moved from employer coverage and into obamacare or medicaid, where they often face higher out-of-pocket costs and worse access to care. In those plans, taxpayers spend three times more than if they had stayed in employer coverage in medicare. Seniors are now scrambling as planned choice shrank and premiums rise. This is not a failure of markets.
▶ 0:44:20It is the result of policies that broke the markets. Congress now faces a clear choice. One path is to spend more money propping up a broken system with higher subsidies, bigger payments and more rules. The other path is to fix the laws and incentives that destroyed competition in the first place.
▶ 0:44:41I'm firmly in the second camp and believe congress must start by breaking up the monopolies, but restoring affordability requires restoring the basics of a functioning market, and that starts with price transparency, so patients know the cost of care before they receive it. It also requires choice and agency, so subsidies empower consumers instead of steering them into the most expensive plans on the market. It also means giving resources to people, not corporations.
▶ 0:45:13Over the next decade, taxpayers will send roughly $18 trillion to insurance companies. I think the president was right that money should go to people, not insurers. And that starts with hsas. Every plan offered should have an hsa sidecar, and families should keep the difference between the subsidy and the premium in that hsa redirecting money to people would fundamentally change market incentives and drive costs down.
▶ 0:45:42And finally, it also requires lowering the cost of medical services themselves by addressing consolidation, banning facility fees, fixing payment distortions, and rebalancing risk in medicare plan markets. What it does not require, however, is price controls. Those rationed care. They stifle innovation.
▶ 0:46:02We need more products entering the market faster to drive prices down, and patients should have direct access to voluntary drug price discounts through trump rx across all markets. And just to sum up, affordability was not lost by accident. It is shaped by policies that this congress has enacted. Congress should use reconciliation.
▶ 0:46:27It should build off the rsc budget framework and the president's great american great health care plan, and restore competition by putting patients ahead of monopoly profits. Thank you. Thank the gentleman. And now yield five minutes to Mrs. bumbry graves. And thank you for your participation. Good morning, and thank you for having me. My name is joyce renee graves.
▶ 0:46:56I am 63 years old and I live in woodbridge, virginia. I am a home care worker and a proud member of seiu virginia. 512 and let me just say start by saying that care is essential because everyone will need it at some point in their lives. I am honored to carry on the legacy of black women and other women of color like myself, who have historically done the majority of care work in our country.
▶ 0:47:19I provide full time care to my adopted sister, leah, who has spina bifida and scoliosis, and my great niece lisa, who has scoliosis and who was born with a small brain and is profound. That means she cannot speak or feed herself, and is completely dependent on others for basic life functions 24 over seven. Both ladies use wheelchairs.
▶ 0:47:43They came to live in my home in 2017, when my parents passed away, because I wanted to keep them with family and they cannot help themselves. I have already been working with leah for over ten years. Both ladies have medicare and medicaid due to their disabilities. I work in health care and I can't afford health insurance. My husband is a freight driver and it will be very expensive for me to get insurance through his work. Instead, we both got health insurance through the affordable care act. We were paying five.
▶ 0:48:1244 per month for our premiums last year thanks to the affordable care act tax credits. Now that these tax credits have been taken away, the premium went up to 1300 and something per per month. We cannot afford that. So we dropped our plan. My husband will be able to get on his works insurance in february, but it is too expensive to add me. I am looking for other options, but I am currently uninsured.
▶ 0:48:40Every day I worry that if I get hurt or sick, I will have to suck it up and keep working in pain. I worry if I go to the doctor emergency room uninsured, I will get an outrageous bill that I cannot pay. My husband is uninsured right now until this work insurance starts next month. However, he recently broke his arm and without insurance, we had to pay 300 to get his cast off and and 300 for them to put a plastic thing on his arm.
▶ 0:49:06We paid the 300 because they would not see us if we didn't pay it at the front desk, but the other 300 we did, I know we were going to have to acquire, and we didn't have $600 to spend at that time. And and so we just paid something on it. And but I was wondering what would have happened if we didn't have the 300 to get the cast off.
▶ 0:49:30Um, would they just would we just walk out of the office with the cast still on because they couldn't afford we couldn't afford to have it taken off? Um, would they have tried to solve what we have tried to get someone else to try to take it off? Right now, I just pray I can save another 300 because, um, when we go back to have the plastic thing taken off, um, we will have to pay the 300 to come in the office, and then we don't know how much they're going to charge to take it off his arm.
▶ 0:49:59And if we don't come up with that, I don't know what I'm going to do. Everything is so expensive right now, and even the dollar store isn't a dollar anymore. It's $1.50 and more. My husband is on short term disability because he cannot drive a truck with a broken arm. There are. I still have two years before I turn 65. And can qualify for medicare.
▶ 0:50:21I have several medical, um, conditions that I have to, um, take care of every month. And I have developed copd because of blood clots I got from pulmonary embolisms. I never smoked. The blood clots have scarred my lungs, and I have to be on a blood thinner for the rest of my life. I cannot afford my, um, be off my pradaxa for more than three days. These prescriptions are very expensive, out of pocket, and even with good rx.
▶ 0:50:51And the doctor prescribed me another prescription that, um, is over $300. And even with good rx, um, it's over almost $200, and I can't afford that. Um, I work so hard to keep two people with disabilities alive, and I can't afford insurance myself. I have already stopped my prescription for the powdered inhaler, which helps me breathe better because I cannot afford it without insurance. And I want you, as members of the congress, to see me and the people I care for.
▶ 0:51:21I want you all to know how serious this is for my situation. You all can vote yay or nay or whatever. You'll be fine. But what about us? So please bring back those tax credits so that I can get my health care back. The affordable care act was good insurance for me and my husband. And tell y'all took those tax credits away. And it may not have been perfect, but you should be working to make it better, not more expensive. These tax credits made it better.
▶ 0:51:50Look, I'm not I'm no policy expert. All I know is that last month I had health care. And this month I don't because I lost my tax credits. So I need you all to bring them back. Thank you. I thank the gentlelady. And, um, we'll now move into a q&a, uh, with the panelists and our members. I'll start.
▶ 0:52:16Um, miss bumbry graves, um, god bless you for taking care of your sister. And I can't imagine the challenge, uh, that you described financially. Um, personally. Um, and so, um, I say this with, with great sympathy, but when you and I won't ask you these questions the way we normally would, I'll make statements.
▶ 0:52:45And if you want to respond, you can. Contrary to what you heard from some of my democrat colleagues, um, when we looked at these programs, medicaid and particular, but also obamacare, we saw that there was tremendous abuse of the system with 38 trillion in debt. Someone's paying for that.
▶ 0:53:07It may not be taxpayers today because they would revolt if we put the real cost on them, but we're just going to surprise our children with a huge bill that they're going to pay for. So one thing we ought to do, and I think should be nonpartisan, right.
▶ 0:53:23Like the first thing we ought to do is say, hey, if there are people illegally getting that money, that is, if they're not eligible for the program because they're in real need and they're in a very precarious and vulnerable situation like you describe, we shouldn't let people game the system and drain that safety net for people like you who need it. I can't imagine you would disagree with that.
▶ 0:53:47We also basically looked and by the way, there were millions of people who were ineligible but were siphoning money off the program that should be there for people like you to avail yourself of you and your family.
▶ 0:54:03And by the way, this obamacare additional subsidy was designed by my democrat colleagues to expire after covid, like a lot of covid programs, but watchdog group after watchdog group said there were millions of people taking money that wasn't theirs because they were not eligible legally.
▶ 0:54:22And going back to the big beautiful bill, all we were saying is and cbo, I've got a letter here that says nobody lost their health insurance except people who were not in your position, but feigned being in that position. That is deceived the taxpayer to draw down money that they weren't owed or they were in this country illegally, or they were able to work and couldn't and and didn't work, that was it.
▶ 0:54:53Waste, fraud and abuse so that the program would be sustainable for people like you. That's the truth. That's the truth, not the political games and rhetoric that you hear. Um, and that's why I supported it, because I want health care and the safety nets for our most vulnerable to be sustainable. They're not today. And the first place we ought to go, in my opinion, is waste, fraud and abuse.
▶ 0:55:21And there was $1 trillion of that, according to cbo. And by the way, the only time obamacare premiums went down is and cbo also, I have a letter I'll submit for the record, cbo says benchmark premiums went down because we rooted out waste, fraud and abuse in these programs.
▶ 0:55:39I think that's the responsible thing to do for people in your position and the taxpayers that fund these, uh, these assistance programs for people in need. Mr. joe white, uh, you talked about, um, do you have a comment? I'll let you comment if you have any comment about what I just said. Do you agree with that?
▶ 0:56:05People who are not here legally in this country, or they're not eligible by law for the. The comment I would like to make is that I understand what you're saying, but I had nothing to do with that. And I'm basically used the health care the way it was supposed to be for my circumstance. And if that is an issue, it's beyond.
▶ 0:56:29What I am trying to do today is look out for the people who are doing using it the right way, which is myself. Right. But it's everybody's tax dollars, right? It's like you, if people are gaming the system and they're making it harder to fund people in your situation, wouldn't you want us to stop people from gaming the system? Well, I lost my health care and I was doing everything by the book.
▶ 0:56:58So, um, if if you cannot control whatever everybody else is doing, that doesn't make it right for me. Who, uh, that I'm doing everything. And I really don't have any comment on that because I'm just concerned with the issues I have for myself and the people who are following the book the way it's supposed to be. Um, ranking member boyle. Five minutes. I'm actually going to pick up on this.
▶ 0:57:28Do you mind if I call you renee? Oh, that's that's fine. First, I to all the witnesses, like I said before, thank you for taking your time out, I appreciate it. Um, but especially to you, renee, because what you're speaking about is incredibly personal. And I know that, uh, it's not the easiest, uh, for anyone, especially, you know, someone who maybe is not used to speaking, uh, before the united states congress. So don't worry. We're not as scary as as we seem sometimes. And you're doing a great job.
▶ 0:57:56Um, just speaking about your regular day to day life. Um, so I just wanted to ask you a few questions on this to help clarify the facts of the matter. Um, what were you paying until this month, when the credits were the obamacare credits were still in effect. What were you paying per month for your health care? Um, 544 for me and my husband. So 544 a month for you and your husband. What did it go up to with the expiration of those credits? Over 1300.
▶ 0:58:25So more than doubled this month. And as a result of that, you can no longer afford it. So right now, as you sit there, you're uninsured. Yes. And if you don't mind my asking, you're a us citizen, right? Yes. What? Our friends on the other side want to tell us is that her experience is just not so. Believe them. Not your lying eyes and your lying ears.
▶ 0:58:52Cbo has confirmed that there are 15 million other. Renee's out there in our society. So when they tell you, oh, it's just all illegals, it's all waste, it's all fraud. Actually that's bs. There are a if you do, god forbid, without getting health care for for as long as this fight goes on.
▶ 0:59:19Uh, and in fact, if the obamacare credits are not renewed and you continue to not have health care, if you get very sick, I'm assuming you'll just show up at the e.r. One day, right? Yes.
▶ 0:59:31So at that point, again, you know, god forbid and not wishing this, but there's a good chance, because you delayed care, you would be sicker and you would actually be far more expensive to treat than if you were getting care more regularly. Right? Yes. And that would affect not just you, but the, the women that that you care for.
▶ 0:59:59What I just was this thought just occurred to me, if you really get sick and can't care for the women who you currently care for, what will happen to them? Well, they would deem me not being able to care for them and they will take them out of our home. Yeah. And so, so really, it wouldn't just be you and your husband, but also the we're the only people they know. My parents had them their whole lives. So leah, my sister here. Yeah. She is 40 years old. She doesn't know anybody but me. Right.
▶ 1:00:27And you know, from in my family members, you know, and stuff. I mean, you they know, come and visit and different things. And she's included on family gatherings. Lisa has, you know, only knows us as well because, you know, she's more severely handicapped. So she knows the voices that she hears and the people she see, you know, and stuff.
▶ 1:00:48So her being put outside of the home and me not being in good enough health to go visit them regular, you know, even if I was allowed to, that would be devastating to them. Well, you are truly doing and I, I think I can speak for everyone. Uh, in saying this on the committee, you're truly doing the lord's work with with that care. And I thank you.
▶ 1:01:11And, um, we'll certainly speaking for myself now, but I think for some others on this side, we'll fight like hell to make sure you can get back your health care coverage. Thank you. I appreciate that speaking. Uh, transitioning just in general with the time I have remaining. I've been studying this issue now for 25 years. Um, there's a great intellectual dishonesty in the whole health care debate.
▶ 1:01:3825 years ago, when I first started studying this topic, the left of center, big proposal, big idea, really from harry truman on was essentially universal coverage paid for by the government, something akin to medicare for all. The right of center reform idea to combat that, to provide coverage, which I believe was created by stuart butler, a an academic at the heritage.
▶ 1:02:06He might have been an ai, but I think it was heritage foundation. Um, his idea and the idea of other conservatives was, no, no, we won't have a government run program like medicare. What we'll do is we'll create a marketplace of the uninsured. And through a series of requirements such as everyone has to have health care and buy into a policy.
▶ 1:02:29A series of credits will allow private insurers to bid on this marketplace. A republican governor of massachusetts named mitt romney took this idea, passed it into law. It suddenly became known as romneycare. Fast forward to a 2008 2009 barack obama was elected and becomes president.
▶ 1:02:51He adopts what had always been the right of center healthcare idea as an effort for compromise, instead of republicans at that time joining with him in a bipartisan effort. They said, oh no, this must be a socialist kenyan plot, and we're going to oppose this awful obamacare, which is a government takeover, having people bid on private plans as a government takeover.
▶ 1:03:18So when you ask, why don't republicans have an idea on health care reform, it's because they don't want to admit that for the last 15, 16 years, they've been snowing you. Obamacare the whole time was actually I hate to cut the yeah, I'm wrapping it up here, but but the right of center idea actually was obamacare. And that's why still all these years later, they have absolutely no solution to healthcare whatsoever. With that I yield back.
▶ 1:03:47Gentleman's time has expired and we now yield five minutes to Mr. lloyd smucker of pennsylvania. Thank you, chairman. Thank you for holding this hearing. Thank you for the witnesses for being here. Uh, miss, uh, graves, appreciate you sharing sharing your story. Uh, I can tell you, at least for myself.
▶ 1:04:06And I think every member here, we want to ensure that you have access to the medical care that you need at a price that you can afford, and that you can have the security of having insurance available to you at a price that you can afford as well.
▶ 1:04:21Uh, and I've been hearing from so many in my district who are in a similar situation who have been on, uh, the marketplace obamacare marketplace for multiple years and have seen dramatic increases in the premiums in those plans, uh, over those years.
▶ 1:04:39It's not just this year, uh, and whether the covid extensions were, um, extended or not, uh, they would have increased even without the extensions. A significant portion of that increase, uh, was occurring in the base of obamacare marketplace, which, by the way, uh, regardless of what the ranking member is saying, um, has was designed by democrats.
▶ 1:05:07Uh, we have seen dramatic increases in costs and even the obamacare subsidies they put in place to expire at the end of the year. But we should get past the politics and think about how we can address your situation and that of so many others across the country as well, who again, we want to ensure that, uh, folks have access to health care and insurance at a price that they can afford.
▶ 1:05:34Um, and when you look at not only the, um, increases that we've seen in obamacare, which have been devastating for you over the years. Uh, but we also look at some of the statistics that Mr. roy and Mr. polito brought up. I mean, it just isn't working. Uh, we are paying much more.
▶ 1:05:52Uh, families are paying more, and the government is paying more for health care than many other countries, uh, across similar countries. Uh, as, as Mr. roy pointed out. And yet we're sicker than many other nations, so something isn't working. Um, and we should come together rather than blaming one another and try to figure this out.
▶ 1:06:18And I think there are some great ideas out there to address your situation. Many others across my district that are in the same situation, I guess maybe Mr. roy, I'll, uh, let's see, where's the clock? I have just a few minutes here. Um, but, um, you know, how would you respond to the discussion that we've just heard? How would you respond to miss graves? Um, what can we do?
▶ 1:06:47I believe in the free market. Uh, I believe that when someone else is paying the bill, you've mentioned that 50% of the government, 50% is paid by the government. Uh, when there's less competition that drives up costs. We see it in other areas besides health care. But what can we do to bring down the cost of health care? What can we do to address, uh, the situation that's been talked about here and others in similar situations?
▶ 1:07:16Thank you, Mr. smucker. Uh, it's a delight to be able to respond to these these points. First of all, there's been a lot of talk of how expensive the affordable care act based plans are, but not a lot of talk about why the affordable care act plans are so expensive and why we need to preserve in eternity so-called emergency covid funding. Uh, to paper over the dramatic increases in the prices of aca based plans, and to respond to a Mr.
▶ 1:07:44Boyle who says that there's, um, no republican ideas about how to improve health care. I'd refer you to mister bill. Mr. smucker, co-sponsor, called the fair care act, which contains a broad, both democratic and republican based system of, uh, of of how he did not pay me to say this. I did provide technical advice on the bill.
▶ 1:08:07So I know I know it intimately, but I'd encourage you to take a look at it, because it would do a lot of the things to correct the design. I worked for mitt romney, so I'm very familiar with mitt romney's health care plan and the, the, the design flaws in the aca, particularly around driving away healthy and young people from the market, are incredibly important to fix. There are ways to fix that in a bipartisan way. Uh, I believe in universal coverage through the private insurance system, which is what the fair care act would help achieve.
▶ 1:08:35Uh, and so I would just say, in the time that I have remaining, I think more members of this committee, if they were to review and, uh, provide better ideas to improve the fair care act, it could be reintroduced in this congress and do a lot to address the concerns that Mr. boyle has raised. Thank you. Thank you, Mr. chairman. I thank the gentleman. And now yield five minutes to Mr. doggett from texas. Thank you. And thank you to each of you for your testimony.
▶ 1:09:02One of the issues not yet addressed this morning, uh, is the problem of soaring prescription drug prices. Mr. roy, you have written about that, I believe, last april, uh, read your opinion piece saying that, quote, no big pharma's high prices don't drive innovation. Uh, and is it still your belief that there's not a correlation between these soaring drug prices and innovation? Uh, first of all, let me just say, Mr.
▶ 1:09:29Doggett, my organization is in your district, so it's a it's a pleasure to speak with you today. Um, the short answer is yes. Um, the line that you hear from the pharmaceutical industry, which is that we must charge more and more every year for the same drugs that we put on the market 12 years ago, or there'll be no innovation is simply not true. We would never say that of any other sector. We would never tell apple. Apple must charge $2,000 next year for an iphone, because otherwise there will be no innovation.
▶ 1:09:57We demand that their products get better and cheaper over time, not more expensive and identical over time. And we've done a lot of research to show that. In fact, almost all the innovation in the pharmaceutical industry comes from unprofitable startups that are spending a lot on r&d but don't yet have marketed products. Um, and yes, those companies are backed by venture capitalists and other investors with the idea they'll be profitable someday. But what do we do with generic drugs?
▶ 1:10:22We say you make your money and then the drugs go off patent, and then life goes on and you have to develop a new drug. Uh, and we need to learn that lesson and bring that more into biologic drugs. The big problem with the way we have, uh, drug pricing now is for what are called small molecules, traditional drugs. The system works reasonably well.
▶ 1:10:42But for those biologic drugs like humira and cancer drugs, the monoclonal antibodies and other drugs engineered from living organisms, uh, the system isn't the same as the hatch-waxman system for small molecules. That's where the big costs are. And do you still believe, as you wrote also, that the number expanding the number of negotiated drugs per year is a reasonable idea that would reduce the federal deficit and medicare premiums? Yes.
▶ 1:11:08So in my written testimony, I cite some of the research that we've done on this particular topic. And the thing I would say here is the inflation reduction act. We do believe that there is a role for negotiation within the medicare program. The problem with the inflation reduction act is that the statute that that congress passed instructs cms to look back at the most expensive drugs over the past ten years.
▶ 1:11:31And the problem is the drugs that aren't going to cost medicare the most over the next ten years are very different than the ones that cost medicare the most over the last ten years. A lot of those drugs are going off patent next year. I certainly agree with you that there are many deficiencies in the way that statute was written, and there's a need for far reaching changes so that we don't have the same amount of prescription price gouging that is occurring today. And I would say, Mr.
▶ 1:11:57Chairman, that I'm concerned that while I know you have previously expressed, in fact, we've joined to deal with some of these issues that in your, uh, proposed reconciliation package, there is not anything concerning, uh, the problems with the prescription drug issue. Uh, there really does need to be, uh, a major focus on how we bring down the cost of prescription drugs.
▶ 1:12:21And, uh, there's nothing about this vague most favored nation proposal which we're yet to see. Any specifics? Just speeches about how great it's going to be to reduce costs. And I think that's important to be in there. Now, as to the issue of fraud and obamacare, I believe that the letter, Mr.
▶ 1:12:42Chairman, that you and colleagues sent out to the government accountability office correctly identified a serious fraud problem with obamacare that needs to be addressed, and that is broker fraud. And the biden administration, cms, addressed it. They suspended a significant number of insurance brokers. How did the trump administration respond? They reinstated every one of them. They provided no explanation.
▶ 1:13:11Some of them were repeat offenders. And to date, I am unable to get a response from doctor oz or anyone in the administration about why the answer to fraud in obamacare, which centered not on greedy individuals out trying to get health insurance they weren't entitled to, but on insurance brokers that were putting on people that didn't even know they were on obamacare. Uh, and the trump administration has done absolutely zero to address that fraud.
▶ 1:13:40That was in the report you received from the government accountability office. That's where a bipartisan effort needs to be made, uh, to get the trump administration to do what it is supposed to do fight fraud, instead of using it as an excuse to deny people, uh, like our witness who testified here, the coverage that she and her husband and millions of others deserve. And I yield back.
▶ 1:14:04I thank the gentleman from the great state of texas, and I'm excited about the opportunity to vote on pbm transparency reforms this week. Bipartisan, by the way. We need to do more there. By the way, we need to be more aggressive. But that's on the docket for this week. And that's great. But it does zero to address pharmaceutical manufacture price gouging. And that's where the the focus of doctor roy, Mr.
▶ 1:14:31Roy's writing has been and where we need much more focus. And I appreciate that. And it's also on the list of things to consider in the reconciliation 2.0, including my bill on patent thickets and how exclusive rights or monopoly forces are extended, uh, inappropriately and are gouging our consumers. You and I have a lot of agreement on this, and I appreciate your comments. With that, I yield five minutes to, uh, Mr. grothman from wisconsin. Yeah.
▶ 1:15:01We're going to do kind of a follow up on that for Mr. roy. Uh, you know, the the gao released a report on the affordable care act, which was, uh, very negative, a lot of fraud. And, uh, when they looked up, they, they had, um, fictitious applicants and 23 out of 24 fictitious applicants were approved for the subsidized aca coverage.
▶ 1:15:27What does that tell you about the basic integrity of the whole system, the whole plan? And, uh, could you comment on that? Sure. So obviously, the the gao report is very alarming in terms of, uh, the the lack of program integrity. I would say that those are there are certain things the executive branch just has to do better. Right? There needs to be better program integrity in terms of verifying, uh, people's eligibility for, uh, for the aca subsidies.
▶ 1:15:54Having said that, one of the biggest problems with the design of the aca is that, uh, when you sign up for coverage in the aca, you're asked to estimate your future income, your future monthly income, and the subsidies that you get are calculated based on your own future estimate, estimate of your future income. It's basically a kind of an honor system. So people have a lot of incentive to say, well, I'm not going to make any money next month or the month after that, and then you get a bigger subsidy.
▶ 1:16:23A simple fix for that would be to base the aca's income based subsidies on last year's income, your actual tax return, or your actual verified income from the previous tax year. If you do that, yes. It's not going to be as precise as maybe what your income is in the current year, but you're going to eliminate a lot of that honor system based fraud that we see today. So that's a simple fix that, it seems to me, would do a lot to address, uh, the program integrity issues with the aca. Okay.
▶ 1:16:48Uh, gao, uh, they reported that 21 billion in advanced premium tax credits were not reconciled with irs tax data. You kind of answered this, but from a taxpayer perspective, how serious is this failure? I mean, again, uh, the the it's serious that you're not verifying people's identity and things like that. That's very concerning. Um, and so that needs to be fixed for sure. And again, congress doesn't, in theory need to pass a statute to to do that.
▶ 1:17:18The executive branch should be able to do it on its own. That's what ideally doja was all about. Right. And hopefully doj's instituted some modernized it systems to address some of this. But I do think that the statutory flaw in the aca is really, really important to fix, because so long as you're relying on my honor to kind of tell you what my future income is, and even if I'm being honorable, I may mis estimate my income because people whose incomes are in the 100, 200, 250 fpl, uh, range, their
▶ 1:17:48Incomes are often volatile because they don't have steady employment. They're going on kind of freelance income. It goes up and down. They're flipping back and forth between medicaid and the aca as well. Their health care, as a result, is very unstable because their provider networks change and their insurance changes. If they're below 100 fpl one month and above 100 fpl the next month. So this is something we can fix by two things. One, what I mentioned already, which is, um, the, you know, going by the prior tax years income.
▶ 1:18:14And the second would be to actually migrate medicaid enrollees that are able bodied into the aca exchanges, because that way there's one government program that they're enrolled in, and their plan can stay the same even if their income goes up or down. That means their provider network will stay the same, their insurance coverage will stay the same. And it's hard enough being poor without having to deal with different insurance plans, depending on what your income is month to month.
▶ 1:18:41So that seems to me, again, something that's not that ideological, that would ensure that everybody has high quality coverage, it would improve health care outcomes, and it would reduce costs to the federal government, to the taxpayer by over $100 billion over ten years, we estimate, because today, covering people on the aca medicaid expansion is more expensive than covering them on the aca private insurance marketplaces. Okay.
▶ 1:19:06Uh, gao identified, uh, tens of thousands of subsidies paid using social security numbers. Associated people were already died. Uh, what does that suggest about cms coordination with social security administration or the irs? And just again, about, yeah, obviously the coordination needs to improve. That's really important. Um, and anytime, look, anytime you're going to have a government program in health care, there's going to be waste, fraud and abuse.
▶ 1:19:33The estimate is that waste, fraud and abuse in medicare is well over 10%, in medicaid. It's possibly over 30% in the aca. Who knows what the percentage is. So there's always going to be waste, fraud and abuse in these programs, and it's important to crack down on it. And again, we rely on the executive branch to try to tackle some of that. And you guys can obviously play a constructive role in that. But the main thing that I would continue to emphasize is what are the design flaws in the statutes that really expand the room for waste, fraud and abuse?
▶ 1:20:00And that's where I think we can do a lot of good in this committee. One general question on on the cost of health insurance overall, uh, we passed a bill a couple of weeks ago on transgenders and that sort of thing. And, uh, in it, you know, we talked we even banned doing these dangerous surgeries on 14 or 15 year olds. Uh, nevertheless, the mental health providers seem to be all in on this. What I think is just tragic.
▶ 1:20:28People ought to go to prison for doing operations on these people. So it raises the question. We passed a mental health bill about ten years ago, um, requiring mental health coverage. If we remove that requirement, what type of savings would that have on health insurance? The gentleman's time has expired. But go ahead and take a shot. Yeah, I don't have a I don't have a quantitative estimate for you, but I will tell you that it is a meaningful percentage of overall, uh, premium costs today, I would guess about 10%, maybe 15%.
▶ 1:20:57Um, now, of course, mental health would still need to be covered in some capacity, but because mental health is such a, uh, kind of vague, uh, category, there's a lot of things that can be qualified as mental health or not. That's what creates the room for mischief. And so tightening the definition of mental health is really important. The gentleman's time has expired. Uh, five minutes for my friend from california, Mr. panetta. Thank you, Mr. chairman. Ranking member. Gentlemen. Ma'am. Thank you guys for, uh, being here, all of you, for being here, appreciate.
▶ 1:21:26Uh, despite the partizan nature of this type of hearing that health care can evoke, we get it. I think all of you, all four of you read it. Some pretty informative statements, uh, about and necessary information that I think all of us can use in order to hopefully, hopefully one of these days after we get past the sniping that unfortunately, health care brings, hopefully we can work together on something, uh, which I hope to do. And renee, thank you for being here.
▶ 1:21:53I, uh, we had a home health care worker, uh, taking care of my grandmother. Uh, nana bennie, uh, what's her name? And I understood firsthand how important it is to have your service. I'm sorry for what you're going through, and I appreciate it. Looks like your husband's here giving you support as well. So I appreciate you, too, and everything that you do, too. And look forward to working with you and hopefully helping you at least get accurate health insurance for all of your ailments going forward. So thanks to all of you.
▶ 1:22:18Um, obviously, uh, in the testimony, uh, from the three gentlemen, it seems that and I'm going to sum it up, uh, that most believe that guaranteed government payments and regulations drive inflation. Um, and while market, the market would drive efficiency. Now, I know the solution is not that simple, uh, because I do believe that there are a lot of other factors that contribute to the high prices of healthcare. Uh, Mr. white, good to see you here. Uh, appreciated your work on the ways and means committee.
▶ 1:22:47Uh, obviously, uh, committee that I'm proud to be on. But a couple of areas that we have purview over in the ways and means committee, I think, should, I think, contribute to the high prices that we're experiencing right now, this tariff policy that, unfortunately, is coming out of this in this administration, at least from what I'm hearing from my local doctors, their inputs and some of the tools they're using are really going through the roof because of these tariffs.
▶ 1:23:15Could you elaborate on how tariffs are contributing to some of these high prices of health care? I'm not an expert on tariffs or trade, but generally in economics, like when you raise the cost of something, the input cost, you raise the price that's charged to the consumer. So we hear from medical device manufacturers, pharmaceutical manufacturers, others that imported products that are subject to tariffs are increasing in price. Yeah, exactly. There's also um, I mean obviously more physicians would be better.
▶ 1:23:45Um, we know right now the administration has put forward some fees on h1-b visas for physician workforce. Do you have any comments on how that impacts the cost of health care? Not directly on the h-1b program, but I think that one of the things we see in the market is incredibly constrained supply of doctors, nurses, pharmacists, we're not using those, um, folks to expand access to care.
▶ 1:24:14And as a result, their prices go up and consumers pay more. Like we have crazy federal policies and rules like graduate medical education and medicare that can artificially constrains the supply of doctors. We need to take the blinders off and really expand those programs in medicare. We don't pay pharmacists for their services. There's a pharmacy available to every consumer in america within five miles.
▶ 1:24:38Um, we ought to be using pharmacists as lower cost options and sites of care, particularly in rural communities, to expand supply and drive down prices. Those are common sense solutions. We need more home health workers. We need more nurses. There's other solutions in those areas as well. They will drive down prices and make care less expensive. Thank you. Um, obviously medicare plays a big part in my district in the 19th congressional.
▶ 1:25:04Uh, it's accepted by roughly 93% of providers and has been a linchpin for the health care system for decades, as you guys all know. Unfortunately, in recent years, many of my constituents have reported consistently over and over that the system is breaking down and that providers who take medicare part b aren't taking new patients. And so they may have insurance, they may have affordability, they don't have accessibility is really the issue that I'm seeing in the 19th congressional in california.
▶ 1:25:31Um, and the government's just not keeping up with inflation when it comes to reimbursements for medicare. Uh, nationwide medicare payments are about 30% lower than what they were 20 years ago, uh, adjusted for inflation.
▶ 1:25:47Now, um, I lead the strengthening medicare for patients and providers act, bipartisan legislation that would index doctors payments to inflation so that providers have the certainty that every that so that every year of knowing that the government will pay them what it costs to serving constituents like mine. So whatever you think of the inflation that's going to contribute, would you agree that doctors pay payments need to be kept up with the cost of offering care? Doctor ippolito, please. Um, yeah.
▶ 1:26:14Indexing payments to inflation seems like a reasonable idea. Great. Thank you. And I'm going to yield back on that. Thank the gentleman. And now yield five minutes to my friend from utah, Mr. blake moore. Thank you, chairman. Thank you. Uh, witnesses for for being here. Um, I appreciate the commentary we've heard so far, and it's obviously a lot to lot to think about.
▶ 1:26:40Uh, um, doctor ippolito, let me ask a question. I, my staff team member, that that, you know, I draft questions with is also in the room. So he's going to appreciate where this question's going. But we have a unique hearing tomorrow in the ways and means committee.
▶ 1:26:58The energy and commerce committee is also going to do the same with with insurance executives from some of our nation's largest insurance providers, uh, interact with, with, with every, every, every element of of health care industry. I get a chance on the health subcommittee of ways and means to be a part of it. Um, interact with them, get to understand all the issues in a broad perspective. Right. There's no silver bullet to fixing the health care costs increase in this country. If you were to get a chance to write the questions for them, what would you want to know?
▶ 1:27:29What would you want to hear from them tomorrow? I suppose I think about it in two ways. One, uh, it's inescapable that the cost that they have to pay to hospitals, to drug companies, to whomever matter tremendously for the premiums we save. So I would want to hear what their top three priorities are in terms of current and next 510 year cost drivers. What's driving premium growth? From the other perspective, I don't know how much of an answer you'll get from them.
▶ 1:27:57Um, I would want to think about where are they really, where is the last dollar that they're earning translating to the least benefit? Um, I've got ideas about where that might be. Um, I might ask them about the last dollar they receive in the medicare advantage program, for example. Um, but those are two general approaches I would take opine on it. Now, I'm going to ask you the same questions. I'm just going to ask you for verbatim.
▶ 1:28:19But I actually think that's really important because another part that I wanted to hear from you was, I mean, we we have been hyper focused on this small, small, smaller subset of, of the enhanced premium tax credits that were set to expire at the end of last year. Um, that's happened, we get that. But it's still only a fraction of of folks like health care health premiums, premium costs are going up for everybody in health care. Right? I think they're actually going up quite faster.
▶ 1:28:46I think there's a lot of data that shows they're going up a lot faster. For those under eptc or the aca, because whenever you just blatantly subsidize the market or give $0 premiums, you're going to see, uh, that, that increase rapidly. That's a question I would like to be able to get to tomorrow. But just generally perspective, just to opine a little bit more on on where you think some of the biggest areas that we could focus to get premiums down for all americans, not just the small subset. Yeah.
▶ 1:29:11So I'll give you an answer that's inspired by the fact I shared, which is that the last 15 or so years we've had relatively modest growth. So there's been in health care costs. There's been some work to try and figure out what exactly has caused that. And the answer seems to be number one. It's not a single answer, but it's a mix of things that are kind of common sense, expanding supply of certain kinds of providers, the rise of nurse practitioners, physician assistants, things like that materially affect prices in those markets.
▶ 1:29:38The rapid uptake of generic drugs across effectively, the entire us market has been very important for ensuring that sure, drugs get paid handsomely when they're on on brand, but and it's time to go generic, we rapidly we rapidly shift to the lower, lower cost options. Consolidation is the other one. Um areas where we've seen more consolidation, it is just an inescapable fact.
▶ 1:30:04There at a certain point, is nothing you can do if there is one hospital in town. So those three jump out. But I'd be happy to send along. I appreciate your testimony to on the elements of competitiveness and market driven approach. So, uh, Mr. white, pretty simple question here. Republicans have an opportunity to do another reconciliation bill. You've, you've you've expressed interest and motivation that we should be focusing on doing a health care related or even more health care related focus here.
▶ 1:30:33Give us your give us your top three priorities you put in that bill. Yeah I think the big thing, building on doctor ippolito's comment is, uh, market consolidation is foundationally increasing prices every in almost every area of the country. And so addressing that upfront. The second thing I think is really important is what the president has suggested in, uh, giving money to consumers, not companies.
▶ 1:31:00That changes market dynamics when you empower a consumer and that consumer has great information about price and quality and plan options, they are empowered to shop. And if they hold the money, they're the purchasers. Um, but the challenge and what we've heard, uh, previously is in every market in america, there's a cheaper coverage option than obamacare. But the law says I can't take my subsidy and buy that plan. So we need to make subsidies portable.
▶ 1:31:29And then the last thing I would say is direct access to discounted prices through trump rx, which would dramatically lower by 80 to 90% the cost most americans pay for prescriptions. Thank you, I yield back. Thank the gentleman. And now yield to the gentlelady from the virgin islands, miss plaskett, for five minutes. Thank you very much, Mr. chairman. And I want to thank the witnesses for being here.
▶ 1:31:53Um, as I listened to everyone, uh, and the discussion that we're having about healthcare and having it in several committees this week, there is a general consensus about the increasing cost of health care in the united states. Um, the burgeoning risk and the continual sickness of americans and how that affects health care costs across the country. The question, of course, is fundamentally, how do we fix this?
▶ 1:32:22Um, I'm a democrat, but I'm not a democratic socialist. I'm a democratic capitalist. I understand that we have a health care system that uses health care companies, but how do we, as lawmakers, provide the resources and provide a framework in which in which those healthcare companies can serve the american people? And that's what government is for? Um, our government is to support the american people.
▶ 1:32:53And if that means supporting the american people, then we need to do that in a manner that takes into account the size of locations, um, urban areas, rural areas, islands like my own. And how do we fix what is really skyrocketing and just running out of control across this country? You know, when I look at h.r.
▶ 1:33:15One and I think about what has happened in the cuts that are happening across this country, nearly $1 trillion would be eliminated in health care coverage for at least 15 million americans. And I've continually told my colleagues to look at the virgin islands, uh, because we are an example of what happens when health care doesn't work, when the federal government does not supplement and support health care.
▶ 1:33:43Just look at what happens here, and I'm going to share some statistics with you all. Uh, based on the cuts that you have going on through h.r. One, nearly $1 trillion eliminated in the virgin islands, because we are a poor rural area, one quarter of people in the virgin islands are medicaid enrollees.
▶ 1:34:05Because we are a location that does not have a large number of jobs or opportunities. We have a very young and poor population and also an elderly population. So another quarter of virgin islanders are on medicare, and they will be affected by these cuts that are about to happen.
▶ 1:34:31That will be an additional cost on local government, on health care systems. It will have a an incredible cascading effect on so many other systems. We think that by giving money to support healthy americans, it means that we're losing money as a country. No, it means that we're supporting people because the virgin islands will show you what happens when it doesn't.
▶ 1:34:58My constituents are not afforded the same benefits as americans living in the 15 states. We're not a part of the exchange. You all talk about the affordable care act like it's the devil.
▶ 1:35:11We would love to have that in the virgin islands, have an exchange, have an ability for small businesses to be able to provide health care to their employees, people living on the margins who don't qualify for medicaid, to be able to have, uh, health care for their families, that's not afforded in the virgin islands. We have no access to supplemental security income.
▶ 1:35:37We have caps on the amount of medicaid funding that the federal government provides, which means that once people's health care has hit the federal spending match, then the virgin islands and puerto rico have to make that up. What happened in puerto rico when they reached that match in the past, they floated bonds because they recognized that sick people create a sick economy.
▶ 1:36:01It unfortunately led to what we know as part of puerto rico's bankruptcy. Our hospitals operate under medicare formulas. From 1982 and 1996 for the second hospital, outdated reimbursement systems that do not reflect current costs. What has that meant?
▶ 1:36:24I have personal friends, young people, young people that I love who have recently had children in our hospitals, and the nurses and their doctors. Tell them before you come, bring your own diapers, bring your own sheets.
▶ 1:36:43They doctors who are pooling their personal funds to pay vendors in the virgin islands, now, in the last administration and in this several congresses, we are successfully secured changes to medicaid funding. So at least the matches were the same. Um, we've directly strengthened health care delivery, but it's not enough. If you want to understand what's going to happen to this country in three years because of what's been done in h.r.
▶ 1:37:12One look at the virgin islands and puerto rico, you're going to see a mess. We've got to get this under control and not believe that government intervention is not the answer. I yield back, I thank the gentlelady and yield. Five minutes to the gentleman from north carolina, Mr. chuck edwards. Thank you. Thank you, Mr. chair. Uh, Mr. polito, thanks for being with us this afternoon.
▶ 1:37:39One of the issues that is high on the minds of the folks back in western north carolina is that of rural hospitals. Uh, a concern to all of us. Uh, the payer mix seems to be different in rural hospitals, squeezing their margins.
▶ 1:37:58Uh, there's a lot of political rhetoric around the working families tax cuts act, where we sought to, uh, rein in the shell game that larger hospitals are playing, that they like to call provider tax.
▶ 1:38:15Uh, the information we're getting is about 93% of that provider tax goes to the larger hospitals, where ceos, in some cases are making $24 million a year. And rural hospitals seem to be left out of the, uh, the equation.
▶ 1:38:35What advice do you have to us on what we might do to better support, uh, hospitals in the in those communities that are many, many miles away from the larger conglomerates? Yes. I mean, the first thing I would say is, I sincerely believe that those types of hospitals have a genuine gripe that when the hospitals in the united states come in, complain about policy, you're often hearing from the most successful, most sophisticated hospitals who are actually the best at at navigating policy landscape.
▶ 1:39:04Uh, not the ones that struggle the most. Um, look, rural hospitals present a genuine challenge, and this is something that I struggle with. I'm somebody who really likes markets where I can get them. Sometimes you're just not going to have a robust market with lots of competition. And that's part of the challenge that we have with especially acute care hospitals in rural areas. How many emergency rooms, how many ob units do you expect to have in some of these areas?
▶ 1:39:31So the thing I would say to start, we have an incredibly complicated web of subsidies and policies targeted towards rural hospitals. I would start by trying to simplify those down the best we can to try and first quantify how much are we sending to these places, and then ask the second question, is it enough? And are we doing it the right way? The answer may be no, and I'm comfortable with the idea that we should be willing to subsidize hospitals, that we subsidize essentially every hospital.
▶ 1:39:59Um, so I'm completely comfortable with the idea of, of we're going to we're not going to have a lot of hospital competition in those areas. We're going to have to have government policy, but we already have it, so we might as well make it at least a little simpler and a little bit more direct. Okay. Thank you. Uh, Mr. roy, you seem to have some thoughts on that topic. As I was asking the question, would you mind sharing this with us? Uh, certainly.
▶ 1:40:23So, um, I think I agree with everything that, uh, doctor ippolito said, but I would I would add that, um, the way we've approached it. So in the fair care act, the bill I was alluding to earlier, um, title for that bill is, is, uh, has also been spun out in something called the hospital competition act. And we, we try to address the hospital consolidation that's driving higher prices in metropolitan areas. Um, and pair that with increased funding for ultra rural hospitals called critical access hospitals.
▶ 1:40:52So what we do in the bill is we say, let's increase the medicare formula for paying critical access hospitals by 10%, which actually doesn't cost very much because the critical access hospitals are not a big part of overall health care spending. And pair that with, uh, a crackdown on, uh, the, the, the monopoly market power of metropolitan monopoly hospital systems that are gouging patients and gouging taxpayers.
▶ 1:41:20So if you pair those two things basically have a kind of more robust approach to antitrust and monopolies in the metropolitan areas by funding critical access hospitals more, you can help support some of these rural hospitals so they don't feel the temptation to sell themselves to the metropolitan hospitals. One of the things that's been happening is you'll have a struggling rural hospital.
▶ 1:41:42Maybe it has 100 beds, but because of population decline and because of efficiencies in technology, a lot of those beds go unoccupied every day, every month, every year. And so the hospital is losing money because they have a 100 bed hospital, but only 50 of those beds are filled every day. So you can try to get the hospital to downsize. Most people don't want to downsize their hospitals. Uh, the other thing that happens is they'll often sell to the big city health system.
▶ 1:42:07And then what the big city health system does is they say, well, um, there are federal regulations around network adequacy. And if you don't have my system in your network, then your insurance plan is illegal. And they use the rural hospitals as a lever to say you must accept our extremely high gouging prices at the metropolitan hospital in order to also have access to this rural hospital.
▶ 1:42:31And the rural hospitals sell into that monopoly, because they know that they can get higher prices that way. So that's just a kind of an introduction to the incredible distortions that the combination of regulations and statutes, uh, bring into hospital care in the rural setting. Thank you. There's so much more I'd like to get into, but I'm out of time, Mr. chair, I yield. I thank the gentleman and yield five minutes to the gentlelady from vermont, miss ballard. Thank you, Mr. chair. And I want to thank all the witnesses for taking the time today.
▶ 1:43:01Um, like the ranking member. I'm surprised. A little shocked, that my republican colleagues want to draw attention to their own shortcomings on on health care. Um, I'm genuinely surprised, because we've been waiting 15 long years for your plan. 15 long years? You've been going after obamacare, saying that you're going to give us a better solution and you haven't year after year after year.
▶ 1:43:29And, you know, I'm speaking here as the lone member from vermont in congress, and 28,000 vermonters are going to lose their health care because of the cuts in the so-called big beautiful bill and the fact that we are not extending the aca subsidies. I've talked to small businesses across vermont that say they're going to lose all of their employees because it's the marketplace that allows them to offer health insurance to their employees.
▶ 1:43:58And so look, here we are. And, you know, I'm glad we're talking about this, but I, I want to just say, you know, of all the the folks here testifying, I want to really talk to to miss renee. Um, you, renee, you are doing an extraordinary job taking care of your family under unbelievably difficult circumstances.
▶ 1:44:22And you're speaking here today not just for yourself, but for the millions and millions of americans who are in the exact same situation that you're in. And you said something that really struck me. Right. And essentially what you're saying is, see me, hear me. I'm a real person. I'm a real human being. Struggle with this. And you said last month I had health care, and this year I don't have any. That's the baseline of why it is.
▶ 1:44:49It's so important that we're talking about this issue. These are real people's stories and experiences. And so I want to go back to what you had talked about in your your opening remarks. You said that your aca premium increased to $1,300 a month. And obviously, we know most americans, they can't afford those kind of increases. What does that mean for you in your life? What choices are you needing to make because of that?
▶ 1:45:16Well, um, I, you know, I will have to we will really have to, um, you know, well, my husband's on disability right now, so that's been, you know, um, a problem, not a problem because he, you know, but it's been another thing we have to deal with, um, along with not having insurance. Right. It's not just that. Right. That's on top of the other struggles. 15 for the first two weeks, so, you know, and everything. But, um, you know, we just have to, you know.
▶ 1:45:48Give up some things we ordinarily would have wanted to do. You know, we won't be able to, um, who knows if we'll be able to plan a vacation. We normally take the ladies on a vacation every year. And, um, you know, we we have to look, um, at, you know, the expense of other things. You know, we it's not just the cost of us having the health care. You know, we have other bills and things, and we pay taxes. That's right. A lot of taxes. Okay. Yeah.
▶ 1:46:14So we have all these other issues that we have to, you know, sit down and discuss and see what we can do because we have to still get health, you know, get our health taken care of. That's right. Whether we have health insurance or not. That's right. You still need to to get that care whether you we just have to, you know, pay pay what we need to pay and and not be able to do anything more or less preventive. You know, that.
▶ 1:46:40You know, like he was saying, if you go to the hospital and stuff, something we could have took care of because we didn't have the money to take care of, then it becomes a big issue, you know, you know, and stuff. My husband has diabetes. That medication is not cheap at all. That's right. You know, luckily we had you know, we're going to have to, you know, get that those prescriptions refilled, you know, soon. And I'm hoping by then his insurance kicks in and everything.
▶ 1:47:04So we, you know, we have to think about, um, you know, um, this is weighing on things for the family, you know, going to the grocery store and getting the things you know, you need for your household. Because even though I have the ladies and they have medicaid and medicare that does not pay for that, you know, everything. And even what, what money they get doesn't pay for everything, you know. So it's not a money making proposition for us.
▶ 1:47:30We just want to make sure that our health care is something that we can, um, put in with our regular finances and not have to struggle. You know, I do, and right now it's it's it's it's going to be a struggle if we can't find anything. Yeah. Because, um, we have tried as insurance and it really they don't look at the whole family type thing. He can get it for 100 and something dollars, but if he adds me, there's zoom up to less 1500 or more.
▶ 1:47:58That's right, that's right, I do, I do and I think you you're speaking right to the experience of americans right now. It's not just healthcare. It's all the other expenses that you're struggling with. And the other thing I would say, if you'll indulge me, Mr. chair, just for a moment, I just want to go back to something that that Mr. white said. I know that we don't agree on everything, but I you said two things that I want to end with here. You said, uh, the markets are broken when it comes to healthcare.
▶ 1:48:26And you said we got to break up the monopolies. I couldn't agree with you more. I sit on the antitrust subcommittee in the judiciary. Why are we not taking up the issue of consolidation? Why are we not taking on the monopolies? And I look forward to actually doing that work, uh, to break the monopolies and make health care more affordable for people. I yield back to my friend from vermont as I transition to, uh, Mr. clyde from georgia.
▶ 1:48:53I leaned over to the ranking member and said, we got problems, uh, in peoria with consolidation, with too much power and too many assets in too few, um, uh, market participants. Uh, look, you know how we feel about big government. I'd say I can't distinguish between big government and monopoly, uh, forces I can't distinguish.
▶ 1:49:19I think the outcomes are are distorted and or there's distortion in the outcomes are, for me, equally bad. But the most important thing is I think there's common ground here. We had a hearing on that. We ought to huddle up at some point, probably not during a hearing, and figure out where we can deal with big medicine, monopoly in pharma, hospital insurance, the whole gambit. And I'm I'm just want you to know I'm down with that.
▶ 1:49:48Okay with that, Mr. chair, if I if I could just offer and this is a little bit we were talking about privately, I do think that there are some areas here of common ground and attending or assembling a roundtable of all members on some of those ideas, uh, certainly has my support. And I think, as you can hear, would have a lot of support on this side of the dice. You mentioned that privately. I'm going to tell it to you publicly, to these guys.
▶ 1:50:19I think you're right. I mean, the hearing, hopefully this is informative. Um, I know everybody's trying to lean in where we can find common ground this committee does. That makes me very proud. But I think the dynamic would, would, would be even better if we huddled up and then and then we can continue that in a public hearing. So great suggestion. I'm going to take you up on that. Mr. clyde, our friend from georgia. Five minutes. Thank you, Mr. chairman.
▶ 1:50:43Um, you know, aside from interest costs, which are at $1 trillion a year now, the primary driver of our $38 trillion national debt is healthcare spending, the single largest contributor to current and future deficits. Federal health care spending grew from roughly $19 billion in 1975 to 1.8 trillion in 2025, nearly a 100 fold increase in just 50 years.
▶ 1:51:10Without meaningful reform, this trajectory puts us on the path toward a serious fiscal crisis, which is why today's hearing really matters. In my opinion, democrats are pushing to revive the so-called temporary covid era aca subsidies, which taxpayer funded benefits to millions of higher income americans. Uh, it expanded that who had never previously qualified, no republican here supported the aca or these biden era expansions.
▶ 1:51:37Yet democrats want to make this costly emergency policy permanent. Subsidies to big insurance companies do not lower health care costs. They simply hide them. Taxpayer dollars, mask rising premiums, distort markets and fail to address affordability. Despite more than $130 billion in subsidies, americans still face $5,000 deductibles, $21,000 out of pocket caps, and denial rates of near 20% by insurance companies.
▶ 1:52:06In fact, since 2014, obamacare premiums have risen nearly twice as fast as employer sponsored plans. Think about that twice as fast as employer sponsored plans. Why? I believe that insurance companies must think that if the government is going to pay for it, then why not charge more? Apparently, that is the mentality of the big insurance companies, and they're able to get away with it. And it has to stop.
▶ 1:52:31While democrats are focusing on subsidizing coverage for a narrow segment of the population, 7% republicans are advancing solutions that help all americans. We passed the one big, beautiful bill to root out waste, fraud, and abuse in the medicaid and the exchanges to ensure that only eligible citizens receive benefits. We also passed the lower health care premiums for all act, which truly puts patients first.
▶ 1:52:56The bill lowers premiums, expands access to affordable quality care, increases choice and flexibility, and improves transparency across the health care system. It lowers healthcare costs for all americans, not just the select few. The nonpartisan cbo bill, cbo, found this bill would lower premiums by nearly 12%, not increase them, thereby reducing the deficit. Yet not a single democrat supported the bill to, uh, to my witnesses, thank you for being here.
▶ 1:53:26All of you. Uh, to doctor eppolito, um, healthcare accounts for roughly a fifth of our national gdp and a third of federal spending. What are the ramifications for our economy, our federal budget, and our federal debt? If healthcare spending continues to grow? And what should congress prioritize to avoid these outcomes? Yeah. I mean, so, uh, the effects are are broad. I'll start with some fairly direct ones.
▶ 1:53:51Um, if costs continue to grow at accelerated rates, we're not going to be able to deliver what we are currently promising people, let alone any ideas that you all have about future ways to expand benefits or expand coverage. And so as a baseline, we need to get the budget in order before we can start thinking about any additional new policies. So I think that's a very important point to keep in mind.
▶ 1:54:14Secondly, I think in terms of general approaches, one thing that you touched on that I think is central to all of this is that if the federal government provides open ended subsidies, in other words, subsidies that simply increase as health care costs increase costs are going to go up. We see it in the affordable care act, where a huge share of enrollees are entirely shielded from premiums. We see it in the employer sponsored market. It does not matter how expensive that plan gets. The federal government continues to subsidize it.
▶ 1:54:44It happens in medicaid. It does not matter how much the state spends. The federal government dutifully sends its check to the state over half of the cost. And so I think in terms of central conceptual approaches, that's one area I'd prioritize. Okay. Thank you. Um, Mr. white, question for you, sir. Um, among many issues, individual coverage, exchange plans created by the affordable care act face a significant problem. Over one third of all exchange enrollees do not use their benefits at all.
▶ 1:55:11None for these zero claim enrollees, health coverages do not translate into health care. Yet insurance companies reap the benefits, collecting billions in taxpayer funds to cover individuals who incur no costs to the insurance companies. So it's pure profit for the insurance companies. What is the fiscal impact of subsidizing these zero claim enrollees, and what policies might reduce non utilization while improving the efficiency of federal spending?
▶ 1:55:39And how many of them do you think are actually fraudulent policies? Well, to start out, uh, 35% of enrollees had zero claims throughout the entire last year of enrollment. Um, that's twice as much as the employer market's like we'll have people without claims. So it's double what we typically see the check, uh, for that enrollee automatically gets paid to from the treasury to the insurance company. Right. Even though they're incurring no costs.
▶ 1:56:08Um, and it's estimated that a large portion of that 35% are fraudulent enrollees because they got through the gate, there was no control. Um, they were signed up by an unscrupulous broker or directly by an insurance company. And so having some kind of control, the best one is just charge a minimum premium, whether it's five bucks a month or the state's minimum wage, one hour of a state's minimum wage, something like that.
▶ 1:56:34Then tells the person, oh, wait a minute, I'm actually enrolled in this plan. I don't want to be in this plan. Et cetera. Et cetera. Gentleman's time has expired. Tens of billions of dollars. Thank you. And I yield back. Thank the gentleman from georgia. And now yield to miss chu from california for five minutes. Mrs. graves, thank you for being here today to tell your story. Uh, I first want to share how inspired I am by you and everything that you do for your family.
▶ 1:57:00Uh, the care that you provide for your adopted sister, laila and your great niece, lisa, every single day embodies the compassion and strength that's defined home care workers for generations. And let me say, it's such a shame what is happening to you and millions of other hard working americans across this country who are suffering and facing impossible choices simply because republicans care more about giving tax breaks to the rich than doing anything to
▶ 1:57:31Help working class americans struggling to get by. Unfortunately, you're all too familiar with that fact, because just a few weeks ago, republicans let the aca premium tax credits expire and effectively doubled out-of-pocket premium costs for millions of families just like you. But for you, it was more than double. It was 139% increase from $544 to $1300.
▶ 1:58:01And it forced you and your husband to drop your coverage. My constituents in southern california share your pain. Laura from my district in pasadena, is a wife and a mother of a special needs child who's on the least expensive plan possible through the aca marketplace. But her monthly premium is increasing by skyrocketing amounts from $56 to $552.
▶ 1:58:28That's an 886% increase. So let me say that one more time, republicans are causing a mother of a special needs child who is struggling to get by and trying to support her family, to pay 886% more each month for health care.
▶ 1:58:51Your story and laura's story are painful reminders of the reckless cruelty of the republican republican party, letting this chaos unfold on their watch. So, Mrs. graves, it's important for my republican colleagues on this committee to hear the real life impact of their choices. You shared that you already had to stop refilling your inhaler prescriptions that helps you breathe.
▶ 1:59:14You've had to pay $300 out of your own pocket for your husband to get a cast, and now you are worrying about how you will come up with 300 more dollars to get that cast off. Can you tell us what other sacrifices you are making in order to deal with the expiration of these tax credits? And I'm I'm really wondering, what is this doing to your mental health? Well, it's a constant worry. Um, of course.
▶ 1:59:45And, you know, with his situation, um, you know, as of the last visit and knowing that the next visit would probably be over $400 or more. Um, it's a great concern because, as I said before, he's on disability right now, so he just got his first and second check, which is not even half of what he makes, you know?
▶ 2:00:06So, uh, technically, those two checks just went for the other visit, pretty much, you know, so it's like, so I am getting worried that, you know, if if he doesn't, um, it's not his fault. And I know that he has to, you know, heal and everything like that, but, you know, um, I am praying that somehow that his insurance has, uh, a, a better deal where we both can get on because we can't find anything.
▶ 2:00:36We're looking daily, me and my daughter, we're looking for the insurance daily. And I don't want my health to decline because of this. You know, um, I work when I could be considered disabled, you know, for the conditions I have. But I want to work and take care of my family, you know, and everything. I want to be help my husband to help provide for our family so that we can still eat, you know, and sometimes be able to do something a little more.
▶ 2:01:04But right now, the main thing that's on my mind since this happened is am I going to be able to or are we going to be able to take care of ourselves so we can help take care of them? Um, have you ever been this worried in your life? Uh, not. Not in a great while. Only when they were fighting me to get the girls. Mhm. That would be another time when I was truly, you know, devastated. But, um, you know, I'm, I believe in god.
▶ 2:01:32And, you know, we pray and hope that things work out for the better because I just have one thing I do want to say, even though the affordable act, um, is, you know, we still have to put out money and everything. You know, it was it allowed us to at least get something to work with, you know, and not have to have the whole expense fall on us.
▶ 2:01:55So it may not have been the best plan in the whole world, but at least it was affordable, where we had health care and we could go to the doctor and do the things we needed to do. I just wanted to say that because I, I do realize nothing's going to ever be perfect. But at least with having the health care, we didn't have this worry on our shoulders. And before we lost insurance, my husband only paid $90 for that $300 visit. You see what I'm saying when we first went in? So that's a big difference when you think of 90 bucks.
▶ 2:02:24And then the next time we went, it was 300 because we didn't have insurance. And then, you know, the more you know, I don't even know what the whole cost is going to be, you know? So I just wanted to say that because I know that, you know, the affordable care act is being thrown around a little bit. And I do want to say on that behalf, it helped us more than not having insurance. I thank the gentlelady. Time's expired and we're going to go to the gentleman from indiana, Mr. stutzman, for five minutes.
▶ 2:02:57Thank you, Mr. chairman. And, uh, first of all, I just want to say I am not sick. Um, I lost my voice because I was yelling too much at the indiana football game. And I know, Mr. chairman, you're used to, you know, texas football and having so many teams down in texas that are great. But we finally have two great football teams in indiana, notre dame and indiana. On behalf of the committee, we congratulate you. Thank you. You're you're hoosiers. It was a it's a great american story.
▶ 2:03:23Uh, but thank you to all of you for for being here. And, you know, I guess kind of like indiana football, which we were just poor losers. We were lovable losers, but poor loser, bad losers. We lost a lot of football. But you know what? With leadership and the right team together, they accomplished something in a short amount of time that I think can inspire all of us as we tackle problems that we have here in, uh, in america related to our health care costs.
▶ 2:03:50I want to focus more on chronic disease and the the maha movement a little bit, because I come from a farming background, and I think that so much of our health starts with what we eat, and I think that that has to be I'm glad that president trump and, uh, secretary at hhs, uh, rfk is focusing more on our food.
▶ 2:04:14Um, you know, we're a young country relative to a lot of other countries. And we have come we have grown so fast. But in the meantime, I think especially in agriculture, we focus on quantity rather than quality and making sure our food is, is truly healthy. Uh, we're feeding the masses, but now we need to start focusing on feeding the masses good, healthy foods.
▶ 2:04:40And it's going to take some personal responsibility on all of our parts as human beings to be sure that we are eating healthy. Um, but I think that we can do some things that would help through our policy drive that that outcome. So I want to talk a little bit about, you know, the chronic disease that's plaguing our nation. Three and four americans have at least one chronic disease, and over half have two or more chronic conditions.
▶ 2:05:08Uh, chronic disease also comes with a significant cost. And according to the cdc, 90% of the nation's annual health care expenditures is spent on chronic and mental health conditions. So, Mr. white, I'd like to ask you, can you expand upon how america's health care system is designed to treat illness after it occurs, and how this contributes to the higher health care costs facing the nation?
▶ 2:05:33Yeah, I think we have a system that's designed for sick care, not preventing sickness before it begins. And that costs us a lot. And so I think the focus on health is is really significantly important for rising for lowering long term health care costs. I think there's three very smart things that this committee should consider in terms of policy.
▶ 2:05:59The first in in aca is, um, discount premium discounts, uh, for wellness activities are illegal in the individual market. And if people were given a financial incentive to eat healthy food or participate in a fitness program or other kinds of like outcomes based activities, they could earn a premium discount that would send a strong signal that that's valuable. And currently those are illegal.
▶ 2:06:25The second thing is in medicare advantage, we're going to spend about $1 trillion over the next ten years on what are called supplemental rebates. Medicare advantage plans earn those rebates in the bidding process, and then they spend them on things like buying down premiums or lowering cost sharing. But they can provide supplemental benefits. Right now, there's not a lot of guardrails. So like some plans offer free bowling balls or movie tickets or greens fees. Those are fitness activities, I guess.
▶ 2:06:55But, um, when they try and provide healthy food, healthy food in medicare advantage is is not considered primarily health related. Okay. Because of that, they have to go to a different program that requires the beneficiary to one be diagnosed with a chronic condition, two incur significant medical expenses like er visits or hospitalizations. And then three, uh, be prescribed uh, healthy food regimen, which is really important for someone like with like diabetes or chronic heart failure, congestive heart failure.
▶ 2:07:25That diet is proven to lower medical costs and improve health dramatically in people like that. So in medicare advantage, if we're going to spend $1 trillion over the next ten years on supplemental rebates, we should at least have some rational rules around getting healthy food to people, make it primarily health related benefit, flex up the rules for medicare advantage, and then encourage healthy food as part of an overall healthcare strategy. Thank you, I appreciate it.
▶ 2:07:53I just had an mri done this last week, and I don't know exactly what all happened, but I know if I use my insurance, it was going to cost me 1200 bucks and I used another program and it cost me 500 bucks. So something's wrong with the system. So anyway, I'll yield back. I thank the gentleman. And now yield. Five minutes to the gentleman. Mr. mcgarvey from the commonwealth of kentucky. Thank you, Mr. chairman. Appreciate you having this hearing today. Mr. graves, I want to thank you for being here.
▶ 2:08:19I don't think people understand how much courage it takes to do what you're doing, to come up here, to tell your story, to tell what is wrong in your personal life with the people you love. And I want you to know that not only do we see and we hear you, but you are representing millions of americans across our country at this table today. When the republicans announced this incredibly cruel, awful, terrible bill that went through this committee, our office was flooded with calls.
▶ 2:08:48One call that sticks out to me is a woman named ann. She's a small business owner. Uh, she has a real estate appraiser. She has a second job. It's because she has an autoimmune disease and she has asthma. Her husband works full time. He's an independent contractor, but they have a 19 year old disabled son who still lives at home. How are they able to make all of this work? Because they had health insurance. And how did they have health insurance?
▶ 2:09:11They had health insurance through the affordable care act, and it was affordable because even though they were just on the silver plan, it cost $350 a month for her to have health insurance when those tax credits went away. Because this republican congress refused to extend them, her health care plan went up to $1,275.69 a month. That is more than her mortgage payment. This is something you are experiencing everyday and I couldn't even walk down the street. I got stopped by. One person said, if you need just one more story, my husband and I own a business.
▶ 2:09:43We're on the silver plan at $650 a month. It's going up to $2,400 a month. You see this? And here's the thing. Let's talk about. We know how much more expensive that donald trump's plans have made health care for americans. Does it stop people from getting sick? No, it does not. No. In fact, your husband is here with you. You work full time, correct? Yes. Your husband works full time. Yes. Yeah. And he's here. He's got a cast on his arm right now. Yes. Right. Because his arm broke.
▶ 2:10:12Now you are paying. You are paying for health insurance when he broke his arm. Does that mean when you went in to get a cast on the arm it was free? No. How much did you have to pay to get a cast on? Well, we had insurance, so it was $90 to go in the office, and they didn't mention any other payment at that time, but it still cost an extra $90, right? These are just the premiums we're talking about.
▶ 2:10:34And I think one of the really cool things that's happening right now is that not only is donald trump making health care more expensive and out of reach for americans, everything else is getting more expensive, too. Are you paying more for your food right now? Oh my gosh, yes, I went to the grocery the other day. A lemon was $0.85. Are you paying more for clothes right now? Yes. Yeah. Are you paying more for your utilities right now? Definitely. For sure. I mean, look at the utility bill. And then of course we know what's happening with housing.
▶ 2:11:03So in the in everything that trump is doing from tariffs to his tax breaks for billionaires, it's making life more expensive for the rest of us. Now they're jacking up the health cost of health care. And what does that mean for you. Well it means that, um, it's it's technically another like you said, some of the causes that went up to the price of the people's, um, mortgages and things like that, you know, and I can't afford to pay two mortgages. No.
▶ 2:11:32And so, um, you know, I have to give up other things, or I just cannot afford insurance right now. It's just. It's funny you say that. I was getting my haircut. I go to a just a I mean, a barber, a true barber shop right there on bardstown road in louisville, kentucky. Uh, I went in. Not only are haircuts $5 more expensive this month than they were last month. Uh, but my barber told me. She said I'm just going without health insurance now.
▶ 2:11:59Like, that's not a plan because you're still going to get sick. Something's still going to happen. You're still going to break your arm. But I know you're having to make tough choices in light of all of the other economic uncertainty. Right? Is you testified a little bit about this. You're now having to choose which of your medications you're going to take. Isn't that right? Exactly. I mean, because all of these medications help to make it so that I can work and help to provide and help my husband with providing for our family and so that we can have a better quality of life.
▶ 2:12:29So, you know, I'm just trying to stay healthy as I can. Thank god I'm not a very sickly person, but the issues I have are not like a common cold or things like that. These are things that have happened to me by no fault of my own per se, you know? So I cannot control having pulmonary embolisms and things like that. You work full time, your husband works full time, you had health insurance, which you think you're supposed to do.
▶ 2:12:59You bought it through the affordable care act. And because of what trump and the republicans did with the affordable care act tax credits, because of what they did with the one big, beautiful bill you now are facing not having health insurance and rationing medication, choosing between whether you can take medication, choosing between whether you're going to have health care or potentially go to work. These are impossible choices, and there are people all across this country who are facing them because of what went through this committee, and we have the ability to fix it if we just have the political will and courage to do so.
▶ 2:13:27Thank you so much, Mr. chairman, I yield back. I thank the gentleman and now yield, uh, five minutes to Mr. moore from north carolina. Thank you, Mr. chairman. You know, warren, one year into this congress, we have delivered meaningful wins to keep more money in the pockets of hard working americans. We increase the standard deduction, expand the child tax credit for working families, and provided real relief at a time when families need it the most in the working families tax cuts.
▶ 2:13:57We also strengthen the medicaid program to serve those who rely on it. Uh, Mr. roy, how did the changes made in the working families tax cut act strengthen medicaid and improve the program's effectiveness? Um, I think it's it's, uh, it's really important to, um, increase the program integrity. And that's one of the things that, uh, the working families tax bill does. Right?
▶ 2:14:20So you, uh, you're going to have more people who are actually eligible for medicaid enrolling in medicaid, and eligibility will go down. Um, uh, also, I think one of the most important things in that bill that is really, uh, was very politically hard to do, and I give congress enormous credit, was to start tackling the, um, as what's been described as the shell game of state based provider and premium tax credits, which are a technically legal but
▶ 2:14:51Spiritually fraudulent way for states to draw down excess federal dollars that inflate the cost of medicaid. As I mentioned earlier, uh, in response to a different question, the cost of subsidizing americans in the aca medicaid expansion is actually higher by several thousand dollars per month per year than subsidizing people in the aca exchanges.
▶ 2:15:12When the affordable care act was passed in 2010, cbo made the opposite projection that it would cost $9,000 per year to subsidize people in the aca exchanges and 6000 per year in medicaid. The actual ratio has been flipped because of those, um, state provider and premium taxes that states have used to, to to inflate medicaid costs. So I think that was incredibly important. I really am impressed that congress was able to make some headway on that topic.
▶ 2:15:39You know, I've noticed that democrats keep using these preposterous adjectives to describe a bill that went after reducing waste, fraud and abuse, uh, across various programs. This was about common sense reforms to stop programs from paying millions of dollars and often to to dead people. Um, just curious.
▶ 2:15:59The the trump administration and republicans, as we've referenced earlier, have taken important steps to bring greater accountability to government spending and also includes major, uh, fraud schemes like those in minnesota, where, frankly, oversight failed. Um, doctor ippolito, what changes are needed to clear the vulnerabilities that currently exist in our medicaid and medicare programs?
▶ 2:16:20Uh, that's a big question, but I guess I would say, um, on the medicaid side of the ledger, I think it all starts with incentives. As long as the federal government is paying for some populations 90%, including financing schemes, more than 90% of the cost, um, it's going to be very, very hard to discourage, um, at least, um, fraud adjacent behavior in the medicare program.
▶ 2:16:47I think there's a number of opportunities traditional medicare needs to do a better job of policing itself. There's no other way to do it. Uh, medicare advantage I think the biggest challenge there is simply making sure that when you send checks to those insurance companies, you send them a reasonable amount and you send you don't give them an incentive to, uh, you know, play games with coding behavior and the like. You know, over the past decade, we've seen the so-called affordable care act be anything but affordable.
▶ 2:17:13Instead, premiums have skyrocketed and families have been left with with, uh, fewer choices. Uh, Mr. white, more than one third of enrollees in the obamacare exchange had zero medical claims. I believe you touched on this earlier and how that compared with the private insurance market. And then roughly now, health care spending accounts for roughly 20% of our nation's gdp and approximately one third of the total federal spending.
▶ 2:17:36But despite spending more per capita on health care than any any other nation, the united states continues to experience comparatively poor health outcomes and lower life expectancy. I mean, what are the policy objectives we should be looking at? Because it's clear that just throwing more money at obamacare is not working. What do we need to do? And I'll open it up to either three of you on that. Yeah, I think the the status quo is broken. Right.
▶ 2:18:04Like the situation you're in, it's it's your you're locked into this, uh, crazy obamacare structure where we made the plans much more expensive. And then we gave you a subsidy to afford those more expensive plans, but said you could only use the subsidy there. We need to allow people to have agency, which means they have freedom to go out and choose a plan that best works for them. A lower cost plan in virginia I know I live in virginia.
▶ 2:18:29There are plans in every market in virginia that are less expensive than obamacare, but no one can use their subsidy on those plans because the law says those aren't good enough. It sounds to me like the answer ultimately is more free market that helps market, that helps folks like rina here and everybody else. With that, I believe my time has expired. I yield back, Mr. chairman. Thank you. And I do thank the witnesses. You all did a great job. I thank the gentleman. And now yield to my friend from the great state of texas, miss escobar, for five minutes. There you are. Thank you, Mr.
▶ 2:19:00Chairman. And many thanks to all of our panelists. Appreciate you all being here. I would very much love to believe that my republican colleagues want to work with us on getting great health care options to americans, but it's hard to take that claim seriously when we've seen nothing but cuts to health care from republicans, as they've controlled every lever of
▶ 2:19:30Government in their one big, beautiful bill. Americans are dealing with an almost $1 trillion cut to medicaid and the affordable care act. Also, that billionaires can get tax breaks. Their policies have kicked almost 15 million americans off their health insurance, and this has resulted in the largest transfer of wealth from working people to the wealthiest people.
▶ 2:19:59Um, and now, with the failure to extend the affordable care act tax credits, we are seeing folks everywhere being losing their access to health insurance in el paso. The community that I represent, almost 100,000 el pasoans, uh, need those subsidies in order to access their care. Mrs. bumbry. Graves, your story was so powerful.
▶ 2:20:25And it is very similar to the stories I've heard from my own constituents, and they are desperate for congress to do something. Personally, I believe in universal health care. That's why I'm a huge fan of medicare for all, which would save lives and save dollars in the absence of republican support for that, our next best effort would have been extending those subsidies.
▶ 2:20:55And you know, what I also want to say is budgets. You know, we I am all for cutting waste, fraud and abuse. All of us. There's nobody in here who would support waste, fraud or abuse. We all want to eliminate that. And no one wants to enrich the insurance corporations or the insurance companies except for the insurance companies.
▶ 2:21:17So no one is championing the profits that these companies are making off of the backs of americans and the federal government. But budgets are about priorities. Miss bumbry graves, I want to ask you some questions. Um, and I just need a simple answer to them.
▶ 2:21:39As we think about how budgets reflect our priorities, we are, um, the federal government would need to come up with $125 million to rename the department of defense to the department of war. Would you prefer health care or for us to focus on renaming the dod health care?
▶ 2:22:03The federal the the trump administration has talked about spending $700 billion to buy greenland. Would you prefer we own greenland or would you prefer health care? Health care? The one big beautiful bill in addition to cutting, um, health care and nutrition programs, also funded $170 billion for ice.
▶ 2:22:30Would you prefer that funding or that we prioritize that funding or health care? Health care? And the president has talked about having taxpayers pay up to $1 trillion to help him get oil out of venezuela. Would you prefer that we spend $1 trillion on getting oil out of venezuela, or would you prefer health care? Health care?
▶ 2:22:56And thank you, ma'am, that is resoundingly what I am hearing from my constituents. That is resoundingly what the american public would like us to prioritize. Budgets are about priorities. The priorities I've seen coming from the other side and the white house are not prioritizing you. Thank you, Mr. chairman, I yield back. I thank the gentlelady. And now yield. Five minutes to the gentleman from virginia, Mr.
▶ 2:23:27Ben cline. Thank you, Mr. chairman. I was listening to my colleague. Um, on the other side, talk about what americans want. And, uh, it is true that they want affordable health care. They want choices in health care.
▶ 2:23:40And, you know, she can speak to her district and the priorities of her district, but, uh, she, uh, probably needs to think about her words before she starts putting speaking for the entirety of the american population, because, uh, from what my district tells me and what my constituents tell me, they want more choices.
▶ 2:24:09They don't like obamacare. They don't like that it removed choices for them. It took them off of their health insurance. Uh, when it was passed, it doubled premiums for their families. And now, uh, premiums continue to go up.
▶ 2:24:29And the only thing that democrats have to offer is more of their tax dollars papering over the inefficiencies of the system by sending those tax dollars directly to insurance companies. Many of my colleagues, many of my constituents who are eligible for these subsidies, don't even know that they're eligible, don't even know that they're receiving the subsidies. The subsidies just go straight to the insurance companies.
▶ 2:24:57So the broken system created by my friend across the aisle and her party and and kept in place by my friend across the aisle and her party, uh, ignores the vast majority of the american people who want a solution that works. And so we are trying to find a solution that works, uh, rather than disparage our efforts, question our motives.
▶ 2:25:26It might behoove her and her party to actually work with us, to find a solution to fix the problems that were created by obamacare. Um, and to actually acknowledge that the system they embraced is not working. It takes a little bit of humility to to acknowledge that the system you created doesn't work. But that's what the democrats need to do. You know, in my district, um, is very rural.
▶ 2:25:52And, uh, we need to make sure that everybody in my district can receive care in 2024, rural medicare beneficiaries were more likely to receive primary care from a non-physician, such as nurse practitioners and physician assistants, than medicare beneficiaries located in urban areas.
▶ 2:26:11Uh, let me ask any of the panelists, mister roy, to what extent do federal medicare policies and state scope of practice laws influence access to primary care in rural communities and our current rules helping or hindering patient access?
▶ 2:26:28Um, so, yes, uh, scope of practice laws are hindering the access to primary care because what scope of practice laws do generally is they limit the ability of nurse practitioners and physician assistants to, to practice to the top of their license, uh, delivering primary care where there are md primary care shortages. And one thing I would add, Mr.
▶ 2:26:50Klein, is that, um, in in the emerging world of artificial intelligence and ai powered primary care, the ability of nurse practitioners and pas to deliver higher quality primary care is going to be significantly improved. So we should be liberalizing scope of practice laws. We should be certainly examining reimbursement rates as it relates to that.
▶ 2:27:11Another thing that I would add is that there have been efforts at the state level and and there could be efforts at the federal level to liberalize, um, scope of licensing provisions around states. So what happens, like, let's say, um, a physician comes here from another country, immigrants to the united states legally. Um, they have to basically wait five years before they can legally practice because they have to pass all the licensing exams.
▶ 2:27:37One thing we proposed and others have proposed is saying have a five year grace period for people from particular countries or graduates of particular medical institutions that the us recognizes as the us standard and have them serve in underserved areas like urban areas and rural areas where there's a shortage in primary care. You do that, you can actually increase the supply of primary care physicians. That's a very good point.
▶ 2:28:01And, uh, you know, one of the things that, um, my district, my constituents, they're looking for is not just more choices, but lower, lower cost choices for them and for their families. Um, health savings accounts empower individuals to shop for health care services is one option, making them more cost and quality sensitive than under typical health insurance. Would transitioning to an hsa forward health model lower federal health expenditures?
▶ 2:28:29And would you agree with the cbo's assessment that expanding hsas would, uh, affect federal spending in one way or another? And how would you think that federal spending would be impacted by hsas? Yeah, so one of the things that was in the one big beautiful bill act was codifying the ability of hsas to be used for direct primary care.
▶ 2:28:49That's a really valuable, uh, kind of micro provision that turbocharges innovation in direct primary care, which has been shown to reduce hospitalizations, improve health outcomes, and increase the amount of time primary care physicians can spend with their patients. One of the biggest flaws in the medicaid program.
▶ 2:29:06I literally wrote a book about this called how medicaid fails the poor is that, uh, you have this card that says you have health insurance and medicaid, but because medicaid pays so much less than other forms of health insurance, basically very few primary care physicians take medicaid. And so you have this card that says you have health insurance, but you can't actually get access to primary care, which means cancer goes undiagnosed and untreated. Other chronic conditions go undiagnosed and untreated, and people on medicaid have far worse health outcomes than people with other forms of insurance.
▶ 2:29:36I think the gentleman is time's expired and now yield five minutes to the gentlelady from ohio, miss kaptur. Thank you, Mr. chairman. I take you up on your offer to have a little working group, along with congressman boyle, ranking member boyle, on where we go forward as a country. I know this is your last term. You're a reasonable man and you're fair. The country needs it.
▶ 2:30:01I think our odds of being successful are probably one out of 100, but I would say it's a noble effort. But I note that your party last year, uh, shut the house down for 58 days. I think it was, uh, because of the affordable care act. And so if we look at recent history and how difficult it will be to climb the mountain, you're thinking about, uh, why did we why was that closed down by the majority party? Because of the affordable care act.
▶ 2:30:27It held up the entire budget of the united states because your party could not have an answer. And so my first question is to the individuals on the panel for each of you who may have health insurance because you raised your hand, please, who has health insurance? Of our witnesses, only one. So two gentlemen are not insured. Everyone has it except for, um, miss, uh, I'm not insured. Um, who?
▶ 2:30:56So two out of two are insured? Out of four. Is that correct? All right, well, that's a whole nother subject, but let me just say that, uh, last year, also, just to put things in a big picture, the, um, uh, ultimately what was called the big beautiful bill that others call the big ugly bill, I call it the billionaire bonanza bill. Uh, passed.
▶ 2:31:17And what it did was it kicked 15 million people off of the affordable care act. 15 million, 31,000 of them are in the district that I represent. And I can tell you that's causing problems in emergency rooms right now. Um, but what was interesting about the bill, actually a tragedy, because a budget is a moral document. Um, what happened was it didn't save any money.
▶ 2:31:44All that fighting, all that indecision has added billions and billions of dollars to our debt. To our debt, actually trillions. When you get right down to it, you add up the years over $4 trillion added to the national debt at the same time as 15 million people were thrown off their health insurance, including, uh, bumbry graves. Think about that. What happened?
▶ 2:32:15Well, what happened was, with that bill, rather than helping people afford health insurance, if you earn over half $1 million a year, you're going to get a refund of $13,600, 13,000. Think about that. So it's upside down. This was an historic tax cut for the wealthiest people in our country, and it goes on forever. There's no end to it.
▶ 2:32:42And so the deficit, the debt keeps increasing. The people, millions of people cut off health insurance. And the people who were well endowed already. This was a wealth transfer of enormous historic proportion. History will record this. So we fought on our side of the aisle to extend the affordable care act until we could find a better solution so people wouldn't die. Okay.
▶ 2:33:05And, um, the, uh, we were successful finally. And there is a bill that will solve the problem for the country. It sits over in the senate. And guess what? They're sitting on it. They're sitting on it. So for the american people that are listening, one of the things you can do right now to dislodge this bill, call your senator, uh, that would be the most important thing the american people could do. Miss bumbry, I just want to end with saying you are courageous.
▶ 2:33:38Thank you for coming and testifying today. What a strong woman you are. I know what it is to take care of beloved relatives who are really ill. It's the hardest thing any human being can do. And you deserve a real gold medal for that. And thank you for sharing your story, for having the courage to speak on behalf of 15 million americans, including 31,000 that I represent, who face the same challenge that you do. And, uh, thank you for being here today. I have no questions of you. I think you've been very articulate.
▶ 2:34:09Thank you for representing the people that I represent. We need better health care. And all of my colleagues here. Thank you. And I yield back. Thank you. The chair now recognizes the birthday boy from north carolina, Mr. mcdowell. Thank you. Chairman, I actually have a question for you. And I just want to make sure that I'm in the right place. This is the budget committee, correct? It's not the irony committee. This is the budget committee. Correct.
▶ 2:34:33That's good to know because it's it's incredible to me, the irony that my colleagues across the aisle are trying to paint this as a problem that we caused my two year old, when she breaks something, she doesn't come to me and say, uh, daddy, why did you break this? Fix it? She comes up and says, I broke this. We have to fix it. They broke this and we now have to fix it. So, Mr. white, I have some questions for you.
▶ 2:35:02Who is the president that signed the affordable care act? Was it donald trump? It was president obama. Interesting. Um, who was in power that drafted that legislation? Was it republicans? It was democrats. Interesting. Um, the expiration date of the covid era tax credits that were put into law to expire when they did, was that done by republicans or democrats? Uh, twice by democrats. Who is the president that signed those?
▶ 2:35:32Was it donald trump? It was not. It was barack obama, or about that joe biden. Yeah. How about that? Um, do you believe that something that requires so many subsidies to function actually works? Absolutely not. So over the past ten years. We've heard this stat a couple times today, but over the past ten years, healthcare spending on the federal level has doubled from 937 billion to 1.8 trillion.
▶ 2:36:00Does that appear to have helped that industry, or does it appear to have helped the folks that I represent in north carolina? What we see in the market is the doubling of costs have generally benefited the large players in the system, whether that's a hospital or an insurer. And you can see that very clearly in their stock prices. When you find out that your insurance premium has increased, does congress set those rates or do the insurance companies set those rates? The insurance companies do. Interesting.
▶ 2:36:30And when hospitals and insurance companies negotiate the rates that they pay each other, uh, does that process involve congress in any way? It does not. How about that? Um, I want to read you, uh, a mission statement from a company, and I want you to tell me if you think it is, uh, a health insurance company, uh, or someone in the health care industry. The mission statement is to build a healthier world by making healthcare easy and affordable.
▶ 2:36:58Do you think that that is a, uh, private equity firm, or do you think that that's a health care company? Probably a health care company. Mm. Interesting. So how about this one? Uh, superior investment performance for clients, uh, through intellectual rigor, value investing and attractive risk adjusted returns. Probably an investment company.
▶ 2:37:19So I'm not here to paint anyone as the victim, whether it be private equity, whether it be the health care industry, because they're just operating under the, uh, the rules that my colleagues across the aisle put on them. I would call them handcuffs, not not even rules, because they now have to try to make money somehow. And they have appeared to have found that the only way to do that is through vertical and horizontal consolidation.
▶ 2:37:48But when you are a private equity firm that that owns physician groups, because we've seen that continue to increase, does a private equity firm care more about me getting cheap inexpensive care or do they care more about a profit? They care about profits, but also delivering those those services efficiently to lower costs and make make better margin. Yeah.
▶ 2:38:14And so you know what I what I hear today is, is my colleagues across the aisle trying to paint us as the people that that wrote. And then our president signed the affordable care act. We've learned today that that is not actually true. Uh, we have been told that that all of the problems with rising health care costs are at the feet of republicans. And I cannot tell you just how simply untrue that is.
▶ 2:38:42Uh, and it's it's really interesting to me that, that my colleagues, uh, they continue to speak and, and hyperbole, uh, and just, you know, spew irony, uh, to try to make this a problem that was caused by republicans because it's not it is not, uh, everyone our insurance costs went up. Uh, going to the doctor costs more. And it is all because of what was caused by the affordable care act.
▶ 2:39:10Uh, and if I had more time, we would get into the the troubles of vertical and horizontal integration. Uh, that help every industry, uh, but hurt us. Uh, but with that, I'll yield back. Thank you. Gentlelady from new jersey, miss coleman, is now recognized. Thank you, Mr. chairman. Thank you to every one of the witnesses for being here. I've learned a lot.
▶ 2:39:31And I agree with one thing that you all have said, that this system is broken and that it is so bureaucratic and so complex and so many regulations that getting the health care to the people that need it is at the end of the food chain, and we should do something about that. This has been, uh, not for me, a committee of irony.
▶ 2:39:53It's been one of absurdity, the absurdity of my, uh, publican, uh, counterparts that think for one second that they can get away with continuing to lie to their constituents that they care about and making sure that they have health insurance and that it is affordable.
▶ 2:40:11If you really want affordable health care insurance and you want the system to be easy to handle, then recognize that government should do its job on behalf of the people of this country. And we should have universal health care known as medicare for all. And then we wouldn't have this problem. Mr. roy, let me ask you a question. Are you not insured because you're so wealthy that you don't need to be insured?
▶ 2:40:37Oh, I'm so appreciative of this question, ma'am, because, um, the reason I'm not insured at the moment is because I'm in between jobs in terms of w-2 and, uh, I actually I'm on the board of a company called crowd health that provides an alternative to health insurance that is far less expensive than what I would be able to buy on the affordable care act's insurance marketplaces. So then, which I find I got I saved money by actually not being access to health care. We all have access.
▶ 2:41:06At the end of the day, that's what's what's important. Um. In my district, which is a very diverse district economically, ethnically, socially, I have 27,000 constituents who will lose their health care because of this big ugly bill. I've got 32,000 constituents who saw their health care rise to the point that they may not be able to afford it.
▶ 2:41:34A family of four earning $66,000 a year will see its premium rise 3,367%. A 60 year old couple making $85,000 a year will see their premiums rise by 221%, which is like $14,000. I don't need republicans to continue to narrate their lies about why we're in this quagmire.
▶ 2:42:04If you want to eliminate, uh, fraud, abuse, corruption, then impeach this president who represents every aspect of disrespect for this country.
▶ 2:42:19If you want to really care about your constituents in rural communities, because most of you all over there represent people in rural communities who are the least wealthy among us and need the most health care, then darn it, cut your diaper strings from the president of the united states and his crazy, incompetent concepts of a
▶ 2:42:51Health care initiative that has no substance to it. And so I'm going to tell you right now, this is, um, banbury graves. I look at you and I see my constituents, I look at you and I see my sisters, I see my aunts, my mother, my grandmother. I see my friends who look like me, who work hard every day.
▶ 2:43:17You work hard every day, taking care of people who would not otherwise be able to take care of themselves, and for which you get paid pennies because you're paid out of the medicare act. And what did the big ugly bill do? The big ugly bill took money from medicaid. The big ugly bill took money from medicare. You're lucky. You can take care of your family and feed your family on what you get paid.
▶ 2:43:45And the absurdity of the republican, um, health care issues about feeding a family for $15, a feeding a person three times three meals for $15 a day.
▶ 2:44:00You can't get a hamburger and a drink for that in this country, everything this administration has done has accrued to the wealthy, the very wealthy, the super wealthy, and has been done so at the need of those who are most in need. This government is supposed to work for the people, not against the people.
▶ 2:44:28And this president has shown us what a president looks like, acts like, speaks like, and does when he doesn't give a about this country, I yield back. Gentleman chair now recognizes the gentleman from ohio, Mr. kerry. Well, okay. Um, a lot to unpack there. Um, first off, Mr.
▶ 2:44:53Chairman, just want to thank you for convening this panel of excellent witnesses. Really appreciate the, uh, the opportunity. I just so I'm correct with this, we all agree that medical inflation is a real thing. That is a fact. And it is undisputed. The increase in health care costs from 2000 to 2024, medical care went up 121.3%.
▶ 2:45:31Now. So all goods and services went up about 86%. So the average premium cost for that family of 4 in 2008, correct me if I'm wrong, was $12,680. I believe my numbers are correct in 2025. That was 27,000. So we clearly, clearly have a problem.
▶ 2:45:59Now I understand the concerns on the aca. Um, I know some of my colleagues and I voted opposite on this last week or so ago, but my hopes are senate picks up something, make some changes, brings us something back.
▶ 2:46:19Not sure what's going to happen there, but but let's just for the sake of argument, under obamacare control costs premiums have doubled since 20 1,435%. This is the number that is staggering. 35% of the enrollees didn't file and file a single claim last year.
▶ 2:46:43Now that's showing, of course, that coverage does not equal access to care. Uh, some interesting other tidbits that we can talk about. But, Mr. white, I do want to just touch on a few things with you. If you'd be so kind, would you expand, um, expanding the length of insurance cover periods provided by the insurers to individual encourage plans to support preventive care more?
▶ 2:47:13Would that. Uh, absolutely. I think that, um, allowing them to provide premium discounts for outcomes measured and confirmed behaviors for wellness, fitness, maha like activities? Yeah, would be huge. Okay. So doctor, let me let me let me go to you, if you don't mind.
▶ 2:47:35Uh, can you speak to any of the data that demonstrates how these investments and preventative care for patients, whether that's obtaining acute diagnosis early or treating some of the underlying causes before they spiral out of control, can bring that cost down on the long term. Um, I think what I would say is that I wouldn't evaluate those interventions just on a cost basis, because you're getting something, you're improving health, you're improving longevity.
▶ 2:47:58And so, um, I'd actually I'd actually suggest you evaluate on both measures because say that again, even if some of those measures don't literally reduce costs, you're getting something for them. You're improving health, you're improving longevity. And so I would encourage you to think about them on, on both dimensions. Okay. Um, Mr. white, I'm going to go back to you. I'm looking for some more facts. Uh, as my time is running short.
▶ 2:48:26So make sure I'm right on this health insurance coverage breakdown. Correct me if I'm wrong. Employer sponsored 164 million individuals. That is 48% 48% employer sponsored medicaid. That's 77 million. That's 22%. Medicare is 63 million. That's 18%. Obamacare 24 million. That's seven veterans. Tricare. That's 10 million. 3% uninsured at 7%.
▶ 2:48:56Just thought I should get those numbers out one more time, Mr. white. About 75% of american workers are offered health insurance through their employer. However, that percentage of companies that offer this benefit decreases with the size of the company. And in 38 seconds. Can you talk about how policies like association plans can support small businesses, offer health insurance as a benefit to their employees? Yeah. Uh, obamacare massively increased regulations on small businesses. About half of small businesses offered coverage 20 years ago today.
▶ 2:49:28Just a third do because of those regulations. And small businesses got none of the subsidies that the individual market gets. So it was a deliberate policy to get people out of group coverage and into obamacare, where the costs are three times more and the subsidies that taxpayers pay are three times more. So just keeping people in small business would save taxpayers and small business employees money.
▶ 2:49:53Association health plans essentially allow those businesses to group together and come under the large group market rules, reducing the regulations so it makes it cheaper, according to cbo, would reduce premiums by 30% 30%. That is much more than a subsidy could do. Or or even the csr payment policy. So it is a huge change. Thank you, Mr. white. I appreciate that, Mr. chairman, I yield back. Thank you. Gentlelady from washington, miss jayapal. Thank you, Mr. chairman.
▶ 2:50:22There's a lot here. Um, and it's interesting how my republican colleagues keep talking about fraud in every committee that I'm in. They want to pin everything on fraud, which is something that we all care about. But I would just point out that if you really wanted to take on fraud, um, I would ask unanimous consent to enter into the record, um, an article from the new york times that says trump's pardons forgive financial crimes that came with hundreds of millions of dollars in punishments, $300 million in
▶ 2:50:52Fines that were supposed, and restitution that were supposed to go to the us citizens that were harmed, that nobody is talking about. Here's another one. The cash monster was insatiable. How insurers exploited medicare for billions. This is about fraud within the medicare advantage system. And it goes through. And it specifically says, here are all the ways that there's fraud within medicare advantage, which is private insurance. People think it's medicare, but it's not. It's private insurance companies.
▶ 2:51:22And instead of taking this on mehmet oz and the trump administration is actually overlooking all of this. So let's just be real and not say that things are about fraud, when ultimately you're using fraud to strip health care and other benefits away from people like miss renee. And I've got 8600 constituents in my district who are in the same position as you are. And so I just think that is one thing I wanted to point out.
▶ 2:51:51Second thing, an area we agree, or at least we have in this committee today, and that is on taking on consolidation within the health care system. And I have a bill to bipartisan bill I introduced in the last congress. Um, hope to introduce it again with bipartisan support called the stop anti-competitive health care act. It's not totalitarian of taking on all the issues with hospitals, but it does take on some of the pieces of anti-competitive behavior within the hospital system. So I hope we can work on that.
▶ 2:52:20Um, the third thing I wanted to say is that budgets are moral choices. They're they're statement of values. And when the big bad betrayal bill was passed with all republican support and stripped 15 million americans of of medicaid, and when the affordable care act subsidies were not extended and put another 20 million at risk of losing health care.
▶ 2:52:47That is all in the context of giving $7 trillion of tax breaks to the wealthiest. So when miss renee says that she's paying a lot in taxes, she's right. And the reality is that people like her are paying so much in taxes. And we're letting the richest corporations, the wealthiest billionaires, get away with paying nothing. So we don't suffer from scarcity in being able to provide health care for people.
▶ 2:53:16We suffer from the greed of people, including donald trump, who used his presidency to make at least $1.4 billion for himself. That was in the new york times. I just think we have to be real about what's going on here. And, um, miss renee, I wanted to come to you because I'm so grateful to you for coming before this committee and telling us about what you're going through.
▶ 2:53:41And I'm so grateful that you are somebody who is looking after your family and doing the very best that you can, and has a lot of challenges before you, um, you said something in an answer. You said at least the affordable care allowed us to get something. At least it allowed us to get something.
▶ 2:54:04And I'm I'm wondering for you if if you had health care from birth to death, where you weren't in the situation where Mr. white doesn't get health care because he's transitioning between jobs, right. If you had health care no matter what, and it covered all the things that you needed and you had to pay some in your taxes to do that, just like you do for medicare. What would that mean for you to not have to worry about being able to afford health care?
▶ 2:54:36Well, for one thing, I'd be able to take care of myself so that I won't be getting things that are curable, that I don't wouldn't ordinarily have money to take care of, because that's what some of these things they were talking about that people can get and whatnot.
▶ 2:54:50Um, is because a lot of times when people can't afford to go to the doctor, they just go when they have no to the emergency room, when they have no other choice, and they found out they had something they could have cured earlier, had they had the benefits of going to a regular doctor for regular visits and stuff, you wouldn't have to wait until you were 65. You mentioned you're not yet 65, so you don't get medicare.
▶ 2:55:13But if we actually had medicare for all, which is my bill, and I'm happy to talk to anybody about it because it actually fixes some of the problems within medicare, like covering things like dental, vision and hearing. So you don't have private for profit companies coming in and doing it. It fixes the reimbursement rates. It gives lump sum payments to rural hospitals so that they can actually afford to continue to survive. And it takes a system that is actually extremely cost effective.
▶ 2:55:41Medicare fixes the problems in it and provides that insurance card. It doesn't take over healthcare overall, but it provides the insurance card so that you have coverage from birth to death. And I hope that maybe some of my colleagues on the other side, as you're talking about the problems in the health care system, would be willing to look at this instead of calling this idea some sort of a crazy socialist idea, it actually just ensures that everybody in the united states of america can get health care because
▶ 2:56:12Everyone deserves it. Thank you, thank you. The chair recognizes the gentleman from oklahoma, Mr. mccain. Mr. chairman, thank you. Um, appreciate my colleague behind me. Uh, representative roy, not many times can I say that, uh, he's a part of my display, but he was kind enough to let me intrude upon his space up here. No one thus far, other than our our, uh, paperwork is really paying attention to this chart.
▶ 2:56:40I know the president, we were told last week, highlighted it in an interview. And so I just wanted to kind of pause a moment. You all, as the experts, are more than familiar with this. But to think that on average, we're spending almost $12,000 as individuals in america and many countries, developed countries are spending 6000 or less half of what we're spending.
▶ 2:57:01And yet, as this chart shows plainly, our life expectancy is significantly less twice as much expenditure, health outcomes less. And you know what a great measurement when you're talking about how long that you'll have time on earth. So clearly the money does not result in better health outcomes to our panel of witnesses.
▶ 2:57:28Um, free market principles have been squandered and traded out for more government interference and more regulations over the last 15 years to a greater level. Um, in the health care market, it's proving the point that whenever the government tries to make something obamacare, whenever the government tries to make something affordable, it makes it too expensive for everyone.
▶ 2:57:51Too many times today we've talked about, if you go back to 2010, family of four was paying about $13,000 to afford their employer based health care premiums. Now it is $27,000 for that family of four. It's almost 100% increase, 92% increase in correlation. At the same time, obamacare. And so the distance between the doctor and the patient grows larger. This gap is filled by more government mandates.
▶ 2:58:19More insurance also rightly pointed out, is that stock market prices in the exact time frame have increased 600% for insurance companies. So the what we're seeing is, is that the government perversion, intrusion of the free market principles is leading to record stock market prices, the insurance industry, it is resulting in higher cost to the consumer. And what it's showing is the unaffordability of the affordable care act.
▶ 2:58:49We could go over this. I could use this video to put out the point, but I want to get to some. I want the american people to hear from the experts. What are the free market principles? Mr. roy, you talked about just a minute ago? Options, catastrophic loss type coverage. There was once upon a time to where you actually went into a doctor's office and you or a hospital, and you were actually paying attention to the cost of things. Not your co-pay, not your deductible. You were scrutinizing it. So it made you a good consumer.
▶ 2:59:17Healthcare is one of those very rare instances where you're not really watching over the cost, because all you're worried about the co-pay or deductible. I want you to just expound upon the return to free market principles, because that's our choice. Either we continue down this pathway started by obama of more government intrusion, which is resulted in more expense, less outcome, greater cost, or we preserve the right to return to what make this country great, which is free market principles.
▶ 2:59:45Would you expound upon crowd health, catastrophic loss coverage, sharing ministries hsas? I'd like for you to expound on what options are out there in your personal example with it. Uh, thank you.
▶ 2:59:57And I would also, you know, given your point about international healthcare systems and how the us compares to other countries, as I mentioned in my testimony, I'd encourage you to look at the world index of healthcare innovation that my organization puts out every year, free app, which looks at a lot of these metrics of how we measure the quality of the health care system, what we can learn from other countries, what they can learn from us. Uh, on the point about, um, options other than health insurance, first of all, we have to make health insurance more affordable, that you can do a lot to have alternatives to health insurance.
▶ 3:00:26And I will talk about that. But we the people still need affordable options for health insurance. And the fact that the affordable care act made health insurance massively more expensive for people who buy it on their own, is a huge problem, because the foundation of free market health insurance is you buying that health insurance for yourself, not depending on your employer to get buy it for you, not depending on the government to buy it for you. You buy it for yourself, and maybe the government helps you pay for that premium.
▶ 3:00:55If you're you get 30s because I gotta yield. Can you talk about other options? Let me talk about trained. We are conditioned in this country. Crowd health is a company that says instead of buying health insurance, um, what they do is they say we're going to pool the resources of our crowd. It's like a secular sharing ministry type system where everybody chips in a certain amount, a couple hundred bucks a month, and then it's not a guarantee, like insurance, that your bills will be paid. So it's different from insurance in that way.
▶ 3:01:24But what it does do is basically they do end up saying, if you have a health episode, I actually broke my hip over the holidays. And, um, the crowd basically pools its resources to cover your hospital bills, your healthcare costs per episode. You pay the first $500 of every healthcare episode, and above that, the crowd pays for it. And I will tell you that because they negotiate the cash pay rate, instead of depending on the insurers to use the artificially inflated rates, the price of the care is actually far lower.
▶ 3:01:52And what I pay monthly for that coverage compared to what I would have been forced to pay under the affordable care act's individual mandate. I saved my family over $1,000 a month with this approach to health care. Mr. chairman, I'm going to yield. I wish we had gotten to catastrophic loss type discussion, savings, sharing ministry, hsas we time didn't allow without a yield and I'm only acting chair so I can't make it all happen, I apologize. Uh, thank you. The gentleman from oklahoma now to the commonwealth, Mr. bobby scott.
▶ 3:02:26Thank you. Thank you, Mr. chairman. Mr. Mr. roy, this crowd thing sounds like a good deal. Um, everybody pools their money, and then you pay the expenses. Um, what happens if the expenses are more than the pool of money? Um, nice to see you, Mr. scott. Um, that hasn't happened yet. Because they have the economies of scale. They have thousands upon thousands of members.
▶ 3:02:52And so, um, that has not that has not happened when they have a big bill, for example, let's say, uh, a newborn baby is in the newborn intensive care unit. That's often a very expensive episode of care, as I mentioned, what they do is they negotiate with the hospital to have a cash rate, which is significantly lower than what insurers or medicare typically negotiates. And then the crowd pays for that.
▶ 3:03:14And so far you can go on their website and actually, look, they have successfully paid, I think something like 99% of the health care bills that are within their agreement. Now, again, it's not insurance. And I'm a big believer in the importance of insurance and universal health insurance. And that assumes that the hospital is going to accept the lower fee rather than just sue the people and get the full fee. That's right.
▶ 3:03:39So it's more efficient to pay the cash pay price than to go through all the bureaucracy of of what we do through insurance. So this goes to show that employer sponsored insurance and medicare and all the other things we've done have distorted the economics of how we pay for health care. And so there's a lot we can learn from models like crowd health, not to replace health insurance. I'm a big believer, again, in universal health insurance like switzerland, you rely on the crowd to come up and save you from bankruptcy.
▶ 3:04:08When you get a big fat bill, they'll step up and pay the bill. One of the reasons why crowd health is growing like gangbusters. Their membership is more than doubled over the last 12 months, is because it's so much less expensive than the plans that you can get on the affordable care act. And again, and why are the affordable care act plans so expensive? When they run out of money, what happens? They don't run out. They haven't run out of money because the scale of the business is such. Programs don't run out of money. What's that?
▶ 3:04:36These programs where you pool your money, don't run out of money. They have not. Okay. Uh. Um. Are you aware that the what was the cost of the big ugly bill? Is it true that, um, between tax cuts, spending and interest is about $4.5 billion, $4.5 trillion? Uh, that's how the congressional budget office scored it.
▶ 3:05:04But the reason why the congressional budget office scored that way has to do with the conventions of how they score fiscal legislation, which we could have a very long discussion about, if you desire, and what would be the cost of extending the affordable care act enhanced tax credits. It would be about $300 billion over ten years. So we spent 4.5 trillion and less than 10% of that.
▶ 3:05:27We could have extended for ten years the enhanced credits and not have people have their premiums double and triple. Is that right? Uh, no. Because what we ought to do to reduce the cost of subsidizing plans under the affordable care act is reduce the premiums. The actual gross cost of providing insurance in the affordable care act. In my written testimony, I described several important ways in which we can reduce the underlying cost of affordable care act plans so that it costs less to subsidize coverage on.
▶ 3:05:57The affordable care act you have described is the magic of pooling your money and having the bill's kind of a separate, because people don't have insurance and the hospitals magically reduce their bills to what's in the pool. It's not magic, it's economics. And again, I would refer you to my written testimony where I detail non-ideological, bipartisan approaches to reducing the cost of affordable care act insurance so that it costs less to subsidize that insurance and you can reduce the deficit.
▶ 3:06:26Uh, what is what is cost shifting of indigent care mean? I'm sorry. Could you say that one more time? What does cost shifting of indigent care mean? Uh, I suspect it's referring to the theory that hospitals try to recoup costs of treating uninsured people by charging others more. Perhaps. Um, yeah, that's exactly what they have to do. Because some people don't pay, others have to pay more.
▶ 3:06:56Um, if 15 million additional people are uninsured, how does that affect everybody else's health care costs? Uh, I would not expect the private market prices to change very much. Those are dictated by negotiations between hospitals and insurers, where I assume that they are using their full market power in the current situation, perhaps it would affect hospital. There's no such thing as cost shifting of indigent care. Yeah, I think that's correct. Empirically. That's correct. Okay.
▶ 3:07:24Um, I yield back. Thank you. Gentlemen. Uh, Mr. roy, thank you for, um, highlighting the the issues with the scoring. Uh, I think it is very important to recognize there was a 1.8% economic growth assumption. That's fine if that's what it's going to be. But we're experiencing almost triple that right now. I hope that continues. But those are those are important aspects to to clear up. So thank you for that. On to the other, Mr. roy.
▶ 3:07:52Uh, let's go to texas. I think my friend from utah reminds me of that line from die hard. It's like a special agent johnson. Special agent johnson, no relation. Right. Um, good to see you, Mr. roy. My fellow austinite. Um, Mr. hipolito, uh, we engaged in a exchange the last time we had a hearing along these lines. I think maybe a year or two ago. Uh, and and I'm just going to repeat real quick that we had a discussion about the consolidation and its impact on the market. And I wonder if this sounds all right to you.
▶ 3:08:2379% of drug claims are processed by only three pbms, uh, one owned by unitedhealth, one owned by aetna and one owned by cigna. Does that sound about right? Uh, in 2023, health insurance plan markets in three quarters of the nation's largest metro areas are, quote, highly concentrated in 90% of these areas, one or more insurers held a market share of 30% or more. Does that sound roughly correct? That sounds roughly correct. My point being, I'm not going to dwell on that because we don't have enough time is that's a massive problem.
▶ 3:08:48My question for the group here is how much of that problem has accelerated under the post aca, post obamacare world as ippolito so or Mr. Mr. white go ahead. Yeah. Just very quickly. We already had concentrated markets before obamacare is about 80% of hospital markets were highly concentrated. Today. That number is 97%. It was set on fire by policies in the affordable care act. Right. In other words, they didn't make it better. They made it infinitely worse.
▶ 3:09:15And so we should have been setting out 15 years ago to make it better. And so I want to get to the heart of this again in this limited time that we have. And, you know, Mr. roy, you have commented on this and you were talking about, um, you know, health sharing. Okay. Whether it's the secular form you described, whether it's the health sharing ministries, a lot of my colleagues on this side of the aisle dismiss it, ignore it, uh, don't understand it. Frankly, colleagues on my side that don't understand it. And a woman who called me the other day whose husband is diagnosed with cancer is heading to md anderson.
▶ 3:09:44Md anderson is where I went when I had hodgkin's lymphoma. I was blessed enough to be able to have an insurance plan in 2011 that allowed me to go to md anderson. I've had constituents who have called me and can't go to md anderson who are covered on obamacare. They are not allowed to go there. This woman is going to md anderson with her husband because they are in a health sharing ministry. They're able to find a way to share the cost and be able to go get care. And so what I would ask is, you know, people say, well, you don't have a plan. We do.
▶ 3:10:13I mean, I've introduced legislation, as the gentleman knows, called the health care freedom act. When I first got to congress, we've had others, the personalized care act. And the model is very simple empower patients and empower doctors. Don't empower insurance companies and don't empower government bureaucrats. Empower patients with health savings account dollars or other models that you can construct, but basically hsa dollars. So I can take those dollars and then go deploy it, and I'll deploy it in direct primary care so I can go give money to a doctor.
▶ 3:10:42We've got great direct primary care thriving as an alternative. So you can actually go get care. Call a doctor. You can go deploy it to health sharing ministries or secular versions where you can defray the cost. Like I just described, the missing element is the ability to have those hsa dollars where you put them there and your employer puts it in there and gets it to you, and the actual backstop of insurance.
▶ 3:11:05You've mentioned the possibility of universal insurance, but even if you freed up the market to be able to have a freedom option insurance a less constrained option so you can go get a catastrophic insurance coverage, you would then be able to have a basically full menu of options. And my question for the group with a minute and a half left go down. Would the model I just described, I call it healthcare freedom, call it whatever you want.
▶ 3:11:28Would that drive prices down, save the government money in the long run, and provide more options and flexibility for consumers in the marketplace? Uh, Mr. ippolito, uh, I would expect something within that general framework would likely lower costs. Yes. Mr. roy? Yeah. Look, we have to let a thousand flowers bloom. We should allow allow models like crowd health to emerge as well. But we also have to tackle for those who want that 100% ironclad guarantee of insurance coverage, that there are affordable options.
▶ 3:11:55And to do that, we've got to reform the way the obamacare regulations work. And I'll ask you, Mr. white, to answer the question. Mr. well, Mr. white, and answer the question. Oh, yeah. The only thing I was just going to say really quickly, too, was you alluded to it in my testimony. I talked about it, individual coverage, health reimbursement arrangements or iras, which were a rule that the trump administration put in the first term. If congress were to codify that, I think that would do a lot to help the market. That's right, Mr. white. Yeah. Right now, rules stand in the way from most employees accessing an hsa.
▶ 3:12:24We should dramatically every employer plan should have an hsa sidecar, and every plan in obamacare should have an hsa component that that will dramatically lower costs. Last question with 20s, one of my concerns that I would ask each of you to be able to opine on going forward and maybe it's in written questions or whatever. I don't have time.
▶ 3:12:43Is that what I was pointing to here when when cbo and jct score a transition to the model that I'm talking about, they're not accounting for the actual market dynamics that would drive prices down. And therefore it is impossible for this body, this committee and congress to transform health care. Would you all agree? And then I've got to yield back. I've written a lot about this over the last 15 years, the cbo, and sometimes they'll privately admit it. They are extremely bad at modeling market dynamics. Mr. white, would you agree?
▶ 3:13:13When you own a house, you treat it differently than if you rent? Cbo is not factoring that in. When they think about hsas. Mr. wrong. Uh, generally speaking, yes. Cbo is pretty constrained, I think, in how they think about some of these these types of scores. Yep. Thank you. Gentlemen, I yield back you gentlelady from minnesota, miss omar. Thank you so much. Um, Mr. I wanted you to expand on that universal insurance, uh, that you mentioned. How would that work? Uh, thank you, Mr.
▶ 3:13:43Morris. So I spoke in my in my written testimony, I elaborate on the swiss model as a model that I think the us could emulate. How does the swiss model work? It's basically universal individual coverage. So you could think of it as the aca for all or medicare advantage for all. So people buy their own insurance. The insurance is regulated to a degree, the actual structure and design and what what benefits are covered are regulated. But the subsidies decline on a sliding scale, sliding scale. So people who are very low income, there's a premium is fully subsidized.
▶ 3:14:12If you're middle income, it's partially subsidized. If you're high income, it's not subsidized at all. And through that system, the swiss are able to reduce how much they subsidize healthcare because they're only subsidizing the vulnerable. In the us, we actually spent a lot of money subsidizing wealthy people. Mitt romney and warren buffett get medicare subsidized coverage paid for by all of us, when they can easily afford to buy their own coverage.
▶ 3:14:36People in the employer based system, the tax break for employer based coverage is heavily regressive, because if you're in a higher tax bracket, the value of that subsidy is higher. So the swiss don't have any of these problems because you buy the coverage directly yourself. You can take it from job to job, and it's again subsidized on a sliding scale. So I certainly encourage you to look at that.
▶ 3:14:58And part of what I've talked about is once you reform the things in the aca that make it unnecessarily expensive to provide coverage in the aca, you make the aca market work better. Maybe then then more people could be in that market. The employer based people could be in that market. The medicaid based people could be in that market, and you could go to more of a swiss style model. I appreciate that. Um, that actually sounds a really good system that we should be, um, looking into. Thank you.
▶ 3:15:22Um, you said that there were some aca regulations that should be updated, looked at. Can you mention. Absolutely. So in my testimony, I highlight a couple in particular. One is age band. So in the aca there's a 3 to 1 age band. That basically means that younger enrollees can only get a two thirds discount on their premium versus the oldest enrollees, which basically doubled or tripled their premiums. And that priced a lot of young people out of the market.
▶ 3:15:49Similarly, because the aca requires the healthy and the sick to be charged the same premium, a lot of healthy people face higher premiums. So the way to fix those two, uh, problems in particular, is to widen the age band of 5 to 1, because that allows those younger people to be priced into the market again and adjust the subsidies by age as well, so that older people are held harmless, and then fund reinsurance, which is basically a way of saying we're going to directly subsidize the cost of covering sick people without
▶ 3:16:20Raising the premiums of the healthy people. You do those two things a $10 billion a year reinsurance fund and 5 to 1 age bands. You make aca based insurance much more affordable for younger and healthy people, and the more young and healthy people participate in the market, that drives premiums down for everybody, which lowers the per person cost of subsidizing the coverage as well. Yeah, I appreciate that.
▶ 3:16:41And then in your written testimony, um, you mentioned the fact that here in the united states, in compared to other industrialized countries, we spend, um, we utilize health care less but spend more. Um, why why do you think that is? Well, the major driver of that, I argue in my written testimony, is that during world war two and afterwards, we basically excluded from taxation the value of employer sponsored coverage.
▶ 3:17:07And that has been the biggest driver of health care inflation over the last 80 years. And so there are lots of ways policymakers and commentators have talked about fixing that. The way I talk about it in my testimony is if we move to this more oriented model where instead of employers buying the insurance for you, they give you the tax advantaged dollars for you to buy your own coverage on the aca markets. But again, we've got to fix the aca markets to make that a more viable option.
▶ 3:17:33Yeah, I appreciate your written testimony and your oral testimony. Um, basically the gist of what I have gathered from, um, it is that we have a broken health care system and there are ways to fix it. Yes. And the constant, I think, idea of trying to bandage it, um, just creates more costly problems for us and still leaves people vulnerable to not having the adequate care that they need. And so maybe it is time, Mr.
▶ 3:18:00Chairman, that we all come together and figure out a way to restart this health care system so that every american can benefit from it. Thank you. And I yield back. Thanks for the questions. Thank you. And to bring us home gentleman from rhode island, Mr. olmo. Thank you, Mr. chairman. And thank you to our witnesses for being here.
▶ 3:18:20Uh, especially, uh, miss graves, uh, who you know is facing a pain that far too many of my constituents are feeling that so many around this country are feeling. Look, the affordability crisis facing americans right now is not an accident. It is the result of decades of policies driven by republicans that increase health care costs and make health insurance less accessible for millions of people across the country.
▶ 3:18:51Right now, families are being squeezed higher grocery bills, higher rent costs, higher utility costs, higher childcare costs can go on and on and on. Uh, in my home state of rhode island, families have been forced to pay $1,800 more in higher costs since president trump took office a year ago. Why? This does not have to be this way. Uh, but sometimes it appears that my republican colleagues are okay with it.
▶ 3:19:18Uh, and health care has become one more skyrocketing bill that families simply can't afford. For 16 years, republicans have fought against the affordable care act, trying to weaken and undermine it at every turn. This past summer, we spent a lot of time in this room, uh, talking about the big ugly law.
▶ 3:19:41Uh, the republicans passed the slashes more than $1 trillion from our health care system and kicks 15 million people off their health insurance, including roughly 40,000 rhode islanders, all, uh, to pay for massive tax cuts that overwhelmingly benefit the ultra rich and corporations.
▶ 3:19:56At the same time, 22 million americans, including 40,000 rhode islanders, are seeing their monthly health insurance premiums explode by 200%, uh, or more, thanks to the relentless campaign against care. 13% fewer rhode islanders have bought health insurance through our state's aca marketplace healthsource rhode island, compared to the same period two years ago.
▶ 3:20:22That means more people are going without care and it's increasing prices for all of us. Uh, I didn't just vote against these cuts. I didn't just talk about them here in washington. I've seen their consequences firsthand. I visited, uh, in my district, blackstone valley community healthcare, and held a round table with members of the rhode island health care uh, health center association who shared how they're preparing for a deluge of uninsured patients.
▶ 3:20:49In october, I spent time with doctors and nurses at the, uh, brown health emergency room. They stressed that the expiration of the aca tax credits will increase wait times and make accessing care harder and more expensive for rhode islanders, no matter how they pay for their care. And in november, uh, I met with a constituent named marlene, a cancer survivor and a substitute teacher retiring this february.
▶ 3:21:14She shared that her premiums would jump from about $808 to $1400 a month if the credits expired. She explained that being forced to switch to a lower coverage plan or go without insurance would put her in a catastrophic position if her cancer returned. Meanwhile, president trump's solution to this crisis his concept of a plan is only one page. You know, it's all laid out here and it's got no details.
▶ 3:21:44When republicans argue that their cuts are about fiscal discipline, let's be honest about the numbers. But the people behind the numbers as well, the biggest driver of our national debt isn't health care for working families. It's decades of tax giveaways to the wealthy. Nonpartisan analyzes show that the big, ugly law adds over $4 trillion to the national debt, while cutting taxes for the ultra rich and making working people less off. It increases inequality.
▶ 3:22:13Yet instead of asking those at the top to contribute their fair share, republicans are balancing the books on the backs of caregivers, seniors, people with disabilities. Democrats are offering a different path. Earlier this month, house democrats forced a vote and passed a three year extension of the aca tax credits. As you know, a concrete step to lower premiums and give the rhode island families I represent just a little bit of breathing room. That's all they're asking for. Every democrat voted yes.
▶ 3:22:40And so I really just want to end with someone who is going through, uh, the, the challenges that we face. Miss, uh, Mrs. graves, your premiums increased by nearly 140%. How is that affecting your choices? And what does action here on congress mean to you?
▶ 3:23:00Well, um, I know that I will have to, since we don't have insurance and and we can't afford the 1300, um, that, you know, I will only be able to go to doctors as needed, not necessarily for anything that can be preventive.
▶ 3:23:18And, um, I also would have to factor into our regular higher costing bills and taxes that we already have mortgage, car payments, those sort of things and everything, normal living things that people have to deal with. And it's I probably won't go to the doctor unless I think that I'm, you know, not going to make it, you know, or if I think I can make it one more day, you know, that type of thing.
▶ 3:23:44So I'll probably work more and be in pain because I can't get my prescriptions as I, you know, need and stuff like that. So. Well, I thank you. And I think that is the most important thing that we hear. The concluding voices is that of someone who is experiencing the consequences of inaction, the consequences of the big ugly law, the consequences of failures. From my colleagues here in washington. We have to do better. And thank you for your voice, I yield back. I thank the gentleman.
▶ 3:24:13Um, make a closing comment or two and then let you all go back, uh, to your lives and your jobs. And we appreciate everybody. And, uh, I think this was a good conversation. I, I guess I would, uh, end by, uh, uh, by correcting the record on the, uh, budget reconciliation bill that we recently passed. Everybody has opinions in this town.
▶ 3:24:42And most, most of the time, there's there's it's hard to resist the political pushes and pulls, uh, to, to to characterize various things independently. So I try to be as fact based as I can where things are working. Well, I like to highlight that where they're not. We need to also recognize and acknowledge it.
▶ 3:25:08The fact that we reduced taxes on working people through overtime and tips and seniors, um, the fact that the folks on the lower end of the spectrum of income got a bigger tax benefit in terms of reduced tax liability than those at the upper end, and the ones at the top 1% actually are paying a higher share of taxes now.
▶ 3:25:31So by doing that, reducing the burden overall for all americans and for our job creators, it's actually creating the thing that we had hoped, which was getting out of the doldrums of, uh, in a of a stagnant economy and seeing real growth, 3.8%, uh, 4.3%, respectively, the last two quarters. That's why wages are now going up.
▶ 3:25:59Wages are finally outpacing inflation. And they haven't for the last several years when we reduced the tax burden and put pro-growth policies in place, all boats rose on the tide of prosperity. And we had the fewer number of people in poverty in recorded history in this country. Everybody was doing better. It turned out the best anti-poverty program is a better job and a bigger paycheck.
▶ 3:26:28And, uh, I would say work incentives and energy policies and I go down the list, have have put us in a in a really strong position that will help us do things like invest where we need to in sustainability of safety nets for the most vulnerable americans, but for the grace of god go all of us.
▶ 3:26:53But one thing I go back to, and I and I recognize that you made a comment and I won't I won't even reference it. But to say. This, none of this just happened. Somebody's paying the bills here. Somebody and waste, fraud and abuse should be unacceptable from a democrat or a republican on health care, on welfare, on defense, on anything.
▶ 3:27:22What we did was unprecedented in terms of rooting out that waste, fraud and abuse in these programs that have that are that are, uh, very expensive. And I would say it's a third of the federal budget, and the budget is $7 trillion, and we're borrowing 2 trillion a year, and we're already at 38 trillion.
▶ 3:27:46Somebody's got to think about how we get our fiscal house in order, or the whole ship is going to sink, and we won't have money for anything not to provide the common defense or a social safety net program. So we've got to think that way. It's the only responsible way to think.
▶ 3:28:03And $1 trillion in keeping people who are not eligible from benefiting from a program that otherwise would go to somebody and sustain that program into the future, somebody who is eligible and needs it. And we debate that. We made law, we made eligibility standards, and there are people that are coming in that aren't eligible, siphoning money away. There are people who are illegal in this country doing it.
▶ 3:28:29100 and there are a number has been used to quantify it. At about 150 billion. It's like 9000 per illegal immigrant in this country. 9000 per illegal immigrant is more than we spend on our most vulnerable american citizen through medicaid. I find that unacceptable. So we should start at no more waste that is draining the system.
▶ 3:28:57And we did that to the tune of $1 trillion. I make no apologies for that. If somebody wants to call that big and ugly, they they're not talking to the people I represent. They think that's beautiful. They think it's beautiful because it's helping the people that need help and sustaining that help. And it's beautiful because we're actually stewarding their tax dollars. We don't act like it's our money. It's somebody else's money.
▶ 3:29:19Um, look, my democrat colleagues, I'm sure, had the best of intentions with obamacare. I really do not question their intentions. But 15 years later, we know it's not working.
▶ 3:29:33And quite frankly, when I hear about the cost of obamacare from witnesses or even people in my district, I think to myself, cms and other groups that study this, government watchdogs, government agencies and non-government will tell you 80 plus percent of the premium hikes are the flawed designs of the program itself.
▶ 3:29:59So while the democrats designed the covid subsidies to end when covid end ended, the underlying mechanics are still in play. And I think that's one thing we're going to have to address, and I'd rather do it with my colleagues, um, because it's more sustainable, it's more durable. I think there's some really straightforward things that we can do, like cost sharing reduction, medical loss ratio, other things.
▶ 3:30:26Um, so I think it's important to keep all that in perspective because there's a bunch of noise and always is on both sides. By the way, I said from the beginning, republicans don't do enough to implement and execute on the things they believe. It's ♪easy to criticize. You know, my colleague Mr.
▶ 3:30:48Scott, who is a friend and a great guy, and the whole lot of my democrat colleagues, it's harder to actually go out and do what you believe and take that risk. But, you know, faith without works is dead. So I'm wondering how much faith exists in the body politic of the republican conference in this moment, in this historic moment, to actually advance the policies we think will help you.
▶ 3:31:15Miss, miss, uh, bumbry, graves and every american that deserves, deserves. When you talk about rights and we can talk about constitutional rights, we have a responsibility to have the most affordable health care, the most effective health care, the best outcomes.
▶ 3:31:35And it's a shame and international embarrassment that a country as well, off as we are, as blessed as we are, is actually at the lower end of that, that something's wrong and we all know it. So let's try to figure out what we can do together and then where we have to go it alone. The question is, uh, how great is our faith and the things that we think are going to help you and everybody else in this great country of ours?
▶ 3:32:07Thank you. Uh, uh, team of panelists. And and for your personal story and for your insights and your expertise. Um, and we appreciate it. God bless you. And this meeting. Now, I'm supposed to read something. Okay. Mr. roy, Mr. roy got that for appearing before they got that. Please be advised that members may submit written questions to be answered later in writing those questions, and your answers will be made part of the formal hearing record.
▶ 3:32:35Any member who wishes to submit questions for the record may do so within seven days. And before I adjourn, I want to say the ranking member made a great, uh, recommendation outside of the hearing. We should get together in a round table discussion and see where we have common ground. We heard some of that on consolidation, vertical integration, basically monopoly forces in health care. I bet you we find more common ground than, than in a, in a hearing like this.
▶ 3:33:03But we'll we'll bring it back to the public as we continue to meet that out. And this this committee now stands adjourned.