▶ 0:15:57Oh, for a five minute opening statement today we will discuss health care costs and patient access challenges by examining the health care provider landscape. This is the third hearing in the committee's health affordability series, following hearings with health insurance executives back in january and stakeholders from the prescription drug supply chain.
▶ 0:16:15Last month, the united states provider landscape includes a wide range of entities and organizations that deliver services to patients, hospitals and large health care systems. Uh hospitals and large health care systems provide acute and specialized care.
▶ 0:16:34However, we have also seen these entities expand into outpatient service delivery, independent physician practices, and group practices to deliver much of the primary and outpatient services that patients rely on every day. Although they are not before us in this hearing, I also want to recognize the critical role that federally qualified health centers, rural health clinics, and community hospitals play in our health system, especially in our in our most rural and
▶ 0:17:07Underserved areas. It is no secret that across the country, patients are faced with fewer choices about where they can receive care. As the provider market has consolidated dramatically, hospitals are acquiring physician practices, systems are merging, and too often patients have little options among providers. In many cases, the states that see the most consolidation have the largest rural populations, exacerbating access challenges, leaving communities strained and contributing to overall unaffordability.
▶ 0:17:36On top of vertical integration, limiting the viability of independent practices, the so-called affordable care act has enabled the landscape to become even more narrow. In fact, because of the affordable care act, any existing physician owned hospital built before 2010 is prohibited from growing beyond the size it was when the bill became law, forcing me to ask myself, how does that make sense? I don't think it does.
▶ 0:18:06As a result, many patients face limited provider options in their communities and may encounter higher prices with little insight into the cost of health services. At the same time, transparency in the health care provider system remains insufficient. Prices can vary widely for the same service depending on where care is delivered, and billing statements may include facility fees, multiple providers, negotiated rates, etc. That are difficult for patients and congress to understand.
▶ 0:18:35Additionally, programs such as the 340 b drug pricing program have become opaque and a few hospitals have gone against the true intent of that good program. The 340 b program was created with the intention of helping safety net providers care for low income and vulnerable patients.
▶ 0:18:50However, as hospitals and large entities participate and expand affiliated contract pharmacies, visibility has become limited into how the programs generated, discounts are used and whether those savings are reaching the patients that they were meant to reach. In many cases, the result of this system is that americans are left at navigating complex and often expensive medical bills, whether from a hospital or routine appointment.
▶ 0:19:15Bills that they did not anticipate cannot easily afford, and sometimes only learn about weeks or months after receiving care. When provider markets lack competition and transparency, prices can rise without patients having the information needed to make cost conscious decisions. Today, we will hear from different organizations that represent healthcare providers across a variety of settings so that we can look for ways to try and make delivering and receiving care more affordable.
▶ 0:19:44We have the american hospital association in front of us, who represents many types of hospitals and healthcare networks. We also will hear from the american medical society, who represents many physicians across the country. The american academy of family physicians is here to give their perspective. We also have the purchaser business group on health before us to provide insights into the relationship between private employers and public purchasers.
▶ 0:20:09We also have a neurosurgeon from the university of california, san francisco, to give the perspective of specialty doctors and the care that they provide to patients. Lastly, we have barbara morel from the american network of community options and resources. These witnesses have unique insights into the factors that are currently leading to the high costs patients are facing when receiving care. And I am looking very much in favor of hearing all of this discussion.
▶ 0:20:36And with that, madam chair, excuse me, madam ranking member, I yield back and maybe, maybe not. We'll see. Time will tell. I think we're going to be just fine. But that was that said to my good friend, the ranking member, miss degette. I now yield her five minutes. >> thank you so much, Mr. chairman. I'm so glad that my colleagues on the other side of the aisle have suddenly discovered that people want to be able to afford health care.
▶ 0:21:04Judging from their actions this last year or maybe this last decade, one might think this is a completely foreign topic to them. In fact, in my opinion, the only people whose bottom line this majority seems to care about are the billionaires whose taxes they cut using funding that was supposed to go to health care coverage for working families and keeping aging adults in their homes and out of facilities. This is not hyperbole.
▶ 0:21:32This is exactly what h.r. One, the big bad bill did. It cut over $1 trillion from medicaid, which will make it even harder for sick kids, people with disabilities, and working class americans who are trying to get by and by failing to extend the enhanced advanced premium tax credits for people who get insurance on the exchanges, people who are just starting out, people who work for small businesses, retired adults who aren't quite medicare age republicans, up
▶ 0:22:05Insurance costs for millions of americans and cut insurance coverage for millions more. But it's not just the people who lost or will lose their insurance, who are paying the price. In many communities across america, urban and rural access to quality care is literally hanging by a thread.
▶ 0:22:25People who are uninsured don't just magically not need care, but they do get tend to delay care, letting conditions get worse and then getting costlier health care, which they often can't pay for, leaving hospitals and taxpayers with the bill and the hospitals who are here today know exactly what I'm talking about. 75% of uninsured adults say that they skipped or postponed healthcare they needed in the last year because of cost.
▶ 0:22:53While uninsured patients may not be able to afford life saving care. Hospitals are the ones who are obligated morally and legally to provide it, and then they have to shoulder the costs themselves.
▶ 0:23:07That uncompensated care is expected to increase by $443 billion nationwide in the next decade because of medicaid cuts in the big bad bill, placing hospitals under incredible financial stress, stress and forcing many to reduce staff and eliminate certain services or even close and as many as 300 rural hospitals across the country may close their doors due to these pressures.
▶ 0:23:34I've talked a lot to the colorado hospital association about this. This will increase wait times, make care less accessible and raise the cost of health care for everyone, regardless of your insured status. And it will also devastate the economies of those small communities where the hospitals are the lifeblood. So what should we do now? First, as I've said before, in this room, we need to restore the enhanced premium subsidies for health insurance.
▶ 0:24:04We need to rip out the health care provisions of h.r. One root and stem. That'll go a long way, but it's just a start, in my opinion. Ultimately, the best way to achieve affordable, accessible care for every american is to build a single payer system like medicare for all.
▶ 0:24:25We need to guarantee that in the us, no matter who you are, no matter where you live, you have access to health care that's going to be there to prevent illness when you're well and get better when you're sick. We also need to recognize where factors outside our healthcare system impact health and address public health safety holistically as a whole of government and indeed a whole of society effort.
▶ 0:24:50The finest doctors and hospitals in the world can't replace healthy food and clean air. I'm not optimistic about tackling these important issues under this majority, but to my colleagues on the other side of the aisle, if you want to work on these issues in a bipartisan way, my door is always open, but we're not going to pass legislation, I call it I call it fig leaf legislation. You've heard me say it before. We're not going to pass fig leaf legislation and say we pass this problem.
▶ 0:25:22When my constituents continue to get sicker and sicker and be unable to afford their health care, we will continue to work on issues, if we can, in a bipartisan way that are going to improve health care quality and reduce health care and reduce costs, and all are welcome to help us, I yield back. >> gentleman gentlelady yields back. I now recognize the esteemed chairman of the full committee Mr. guthrie thank you. >> I appreciate appreciate our witness. Thank you, Mr.
▶ 0:25:53Chairman, for holding this hearing and and I want to talk about why we're here. One, um, people have to afford healthcare. That's absolutely true. And I disagree with my friend from colorado that the answer to this is a single payer system. Then you you don't get I don't think you can look at a system that delivers quality health care that has that system. I will also say that the expense in the health care system, the affordable care act, is still the law of the land. And so when we're dealing with the rising cost of health care, that's the law of the land.
▶ 0:26:21Let me tell you why, and I'll tell you why we're here. And I'm going to talk about my favorite constituent. So she said I could use her information as my wife. So, so we've we've been very blessed to have very healthy time until just, just recently she had a thing about this is this is why people are frustrated. This is why we're hearing from everybody. This is the system we have today. So my wife has a was trying to pass a kidney stone. It got impacted. So we had to go to the hospital, have a kidney stone removed.
▶ 0:26:47Um, I take her at 6:00 in the morning, leave at noon, and uh, a couple of days later, a few days later, we get a bill that says your stay in the hospital for less than six hours was $28,000, $28,000. It said your your bill was $28,000, your health insurance paid $27,500 and you're paying 500. So we paid $500. We pay $1,500 a month for the insurance.
▶ 0:27:15We have people think that members of congress get free insurance. We pay $1,500 a month for it. Deductibles, co-pays. So think about that $28,000 for six. And we had a good doctor, wonderful doctor, wonderful person. But we're trying to figure out why was it 20? We can't figure out why was $28,000. You can't figure it out. So then the second thing is, unfortunately, she slipped on the ice. Uh, when we had our ice storm in kentucky and pulled her shoulder out of socket and broke her, a part of her arm goes to emergency room.
▶ 0:27:42Um, a few days later, we get a call from a debt, a debt collector. Now, last time we got a loan for anything, the guy looked at us, said, y'all have the highest credit score I've ever seen. Matter of fact, he goes, I was one point behind her. I don't know why it wasn't the same because they're all tied together and she had bragging rights. She had a higher credit score than me by a point. So we pay our bills. We have the means to pay our bills. We pay the $1,500 and we want it. So we have the means. We have.
▶ 0:28:11We got a call from a debt collector. When she went to the emergency room, my son in law took her because I was here and he didn't have our insurance information. She couldn't give the insurance information. So it seems like the provider who could have called us because they obviously knew who we were, because they turned us into a debt collector, didn't didn't even reach out. Fortunately, not many of my constituents can do this. I have the ceo's cell number. Okay. Gave him a phone call. Oh, they didn't have your insurance information?
▶ 0:28:38Well, my wife was, like, in excruciating pain. He goes, well, let's run it through and see what can happen, and then we'll just run it through insurance. So think about the system that people deal with. So yesterday I had a prepared statement, but then I changed it because yesterday we get this text from my wife, sent me a text from a credit, I don't know who credit is, but they're from chicago and they send us a letter. And first we thought it was a scam. It was so absurd.
▶ 0:29:07And we start looking online and I know who credit is, but if you start reading their comments online, you would think it's a scam company, but it seems like they're legitimate. And it says, and I'm reading as of february 6th, you owed $834.60 between february 6th and today. You were charged zero interest. You were charged zero fees, you paid, your insurance paid, and you were credited for this amount. -$1,947.40.
▶ 0:29:32So you now oh 27 $2,782. So what we owe was $800. We didn't know we owe because we never got a bill. Now it's doubled. So it's tripled three times what it originally was. And we never received a bill. So the providers turned us into a debt collector without ever informing us the bill that we have.
▶ 0:30:00So I hate that this happened to my wife. I hate that my wife has been through this, but I'm glad that I've experienced it because I was committed to transparency, competition in health care. And I am telling you, I am committed not just to to moving a bill.
▶ 0:30:16I'm committed to getting it done because a lot of people aren't in the position that I am in and have the opportunity to try to work through this with the ceo of the hospital, to say, why in the world were my wife's worried about our credit rating that she's taken great pride in, especially since she's one point higher than me. She's worried about it. It's just absolutely frustrating that a six hour procedure costs $28,000, and then you go to the emergency room and the and the provider makes no effort to try to run you down.
▶ 0:30:44Say, all right, you're going to are you going to pay? You know who we were. And so now we're dealing with a debt collector that if you read their comments meta credit, read about them online. They a lot of people have had really bad experience with them. So we're going to deal with this. We're going to fix it, and I'll yield back. >> gentleman yields back. That's what americans are facing across the board. And all of us have a story. I now recognize the ranking member of the full committee, Mr. pallone of new jersey, for his five minutes for an opening statement.
▶ 0:31:15>> thank you, Mr. chairman. Committee republicans are holding yet another hearing that is purportedly about lowering health care costs for all americans. And yet they continue to actively make the affordability crisis of their own making. Even worse, republicans are hoping the american people will forget that last year, they cut more than $1 trillion from the affordable care act, medicaid and medicare with their big, ugly bills so they could give giant tax breaks to billionaires who don't need them.
▶ 0:31:41And now, of course, when I'm home, my constituents are saying that these health care an irresponsible war. And they and they're right. And they say that instead of paying billions of dollars a day for an irresponsible war in iran, we should have taken that money and used it to help people with their health care and give them the premium tax credits. And they're right about that, too.
▶ 0:32:08These cuts that the republicans are making mean that 15 million people are losing their health insurance, and tens of millions more saw their out-of-pocket costs skyrocket at the beginning of this year. And instead of doing something to help the situation like unwinding the cuts or extending the aca and enhanced premium tax credits, republicans are holding affordability hearings in an attempt to show that they care. Well, it's nothing but talk.
▶ 0:32:33As americans watch the doctor's offices and hospitals and the community shut off critical services like labor and delivery, or even closing their doors altogether. Congressional republicans are doing absolutely nothing to fix the problem.
▶ 0:32:47And worse yet, republicans and the trump administration are doubling down on the big, ugly bill and making even more health care cuts after republicans refused to extend the aca tax credits that would have made comprehensive health care more affordable for more than for about 20 million low and middle income americans. The trump administration has now proposed new rules to increase costs even further by proposing to increase the amount that insurance companies charge people.
▶ 0:33:15The administration's proposed rule would raise deductibles for many families with aca policies to $31,200. That's as much as 75% of household income for many of the people eligible to purchase this coverage. So now they have these huge deductibles.
▶ 0:33:30And in addition to the premium increases, and that means for the health care provider sitting in front of us today, that uncompensated care is going up even more because americans are simply not going to be able to afford insurance and will be forced instead to once again rely on emergency rooms for care. And republicans have wanted to take us back to the days before the aca.
▶ 0:33:52Sure, the chairman said the aca is still out there, but if you can't buy the policy or you can't afford the deductible, you're going back to the days when there was no aca where americans were skipping care that they need, and instead come to health care providers sicker and more desperate. And it's going to leave millions of americans buried in medical debt. That's the other thing that will force even more providers to close their doors. And the trump administration and republicans are doubling down on medicaid cuts at all.
▶ 0:34:23Also, we heard this yesterday in the hearing in their latest crusade, the trump administration has acted to withhold and defer about 30% of all federal medicaid funding to minnesota, cutting funding for home and community based care that seniors and disabled people, including disabled children, rely on to live healthy lives in their communities. Instead of being institutionalized. Substance use disorder services will also be cut to help people recover. Support services for children with autism will also be cut.
▶ 0:34:53But this isn't just in minnesota. Doctor oz and vice president vance have made clear that they are on a state by state crusade to cut funding for services that seniors and people with disabilities rely on, and the committee republicans are simply piling on, sending their own letters, attacking medicaid funding for similar services in ten states.
▶ 0:35:13So I would ask mister chairman unanimous consent to insert into the record letters from organizations representing seniors, people with disabilities and people with substance use disorder who rely on these services, begging republicans to stop this assault on their healthcare. If I could ask unanimous consent to to include those records, those letters in the record. >> without objection. >> thank you. So ordered.
▶ 0:35:35And I have to say, I am tired of republicans using this hearings as an attempt to show they care about health care affordability when they created this health care affordability crisis in the first place and are making it worse. You're not fooling the american people. They know republicans are to blame for skyrocketing healthcare costs, millions losing their coverage and hospitals closing their doors.
▶ 0:35:58You know, I have to say, I didn't even realize that a hospital in new jersey could be a hospital and not deliver babies or provide pediatric care. But that's what's happening. If they're not closing, they're cutting back on essential services. And with that, I yield back the balance of my time. Mr. chairman. >> gentleman yields back. We now conclude with opening statements. The chair would like to remind members that pursuant to committee rules, all members opening statements will be made a part of the record.
▶ 0:36:23We want to thank our witnesses for taking the time to testify before the subcommittee, although it is not the practice of this subcommittee to swear in our witnesses, I would remind our witnesses that knowingly and willfully making materially false statements to the legislative branch is against the law. Under title 18, section 1001 of the united states code, you will have the opportunity to give an opening statement followed by questions from members. Our witnesses today are, uh, richard pollack, president and ceo of the american hospital association.
▶ 0:36:52David, I chair, board of trustees of the american medical association. Sean martin, executive vice president and ceo, american academy of family physicians. Elizabeth mitchell, president and ceo, purchaser, business group on health, anthony g. Sorry degiorgio, neurosurgeon, university of california, san francisco health. And barbara merrill, ceo, american network of community options and resources. Per committee custom.
▶ 0:37:21Each witness will have the opportunity for a five minute opening statement, followed by a round of questions from members. The light on the timer in front of you will turn from green to yellow when you have one minute left. I now recognize Mr. pollack for his five minutes to give an opening statement. >> chairman griffith and guthrie, ranking member degette and pallone, the members of the subcommittee, thank you for the opportunity to be here today.
▶ 0:37:47America's hospitals and the women and men who care for patients and families every day are truly the backbone of the nation's health care, and one of the key elements of our national critical infrastructure. Think about the role that hospitals play. They are there in the very first moments of life, supporting newborns and families. They are there at the end of life, providing compassionate care when it's needed most, and they are there for patients and countless moments in between caring for the injured, sick and keeping people healthy.
▶ 0:38:16That blue and white h sign that we see on the side of the road is iconic because it represents hope, healing, and refuge. It says follow me because of the promise that skilled around the clock care is close by. That responsibility is enormous, and it's part of what makes hospitals unique in our health system. Now let me be clear. America's hospitals and health systems are deeply committed to providing high quality, accessible and affordable care.
▶ 0:38:42And across the country, hospitals are increasing efficiencies, adopting innovative technologies and rethinking how they deliver care. Many are investing in preventive care and care coordination programs that help patients better manage chronic disease and avoid unnecessary hospital visits and stay healthier at home. These efforts improve outcomes, and they help lower costs for patients, families and the entire health system. Hospitals are also using new technologies to make care more affordable and more convenient.
▶ 0:39:12Telehealth, remote monitoring and digital tools are helping patients access care in ways that fit their lives. Electronic health records and data driven care model models help clinicians catch problems earlier, avoid duplicative tests, and coordinate treatment more effectively. At the same time, science and technology are unlocking possibilities that were once unimaginable, and hospitals are where breakthroughs become real and we turn discovery into healing.
▶ 0:39:43But we also know there's more work to be done as we talk about lowering costs and protecting access to care, it's important to understand the environment hospitals are operating in and the pressures they're facing now. Hospitals are different than other parts of the health care system, as they support a wide spectrum of services emergency care, inpatient care, surgery, diagnostics, all operating simultaneously.
▶ 0:40:07They have substantial fixed costs to maintain specialized services, high cost equipment and a fully staffed 24 over seven environment that remains ready for anything ranging from tornadoes to hurricanes to wildfires to floods to mass shootings to other large scale emergencies, including the unthinkable. As a practical matter, hospitals are the public health system in many communities and societies ultimate safety net.
▶ 0:40:34We have seen time and time again that when america has a crisis, it turns to its hospitals. Hospitals today are balancing rising costs across the board, many of which are completely outside our control. They're treating sycamore medically complex patients. And all of this is happening in a payment system that is increasingly misaligned with the realities of delivering care, particularly government reimbursement that is less than the cost of providing care.
▶ 0:41:01And I want to give you a few examples. In 2025, hospitals spending on medical supplies, equipment and technology increased 10%. And that includes life saving devices clinicians rely on every day, not to mention significant investments in cybersecurity. Hospital drug expenses rose more than 13% in 2025, driven by rising prices and the introduction of new high cost therapies.
▶ 0:41:28About 60% of a hospital's expenses go to paying their talented workforce, and those costs are increasing 5.6% a year. Overall, hospital expenses increased 7.5% last year, while hospital prices rose only 3.3%. And this is despite the fact that as a percentage of the gdp, total health spending, hospital services have remained relatively stable for decades.
▶ 0:42:01Hospitals, patients and caregivers also face growing administrative burdens from large commercial insurers, delays, denials, and disruptions in care that add enormous costs and keep clinicians from caring for patients. And we can ignore we can't ignore what's ahead. Hospitals are preparing for reductions in federal medicaid funding and changes to the health insurance marketplaces. This will further strain resources and increase the number of uninsured and underinsured patients.
▶ 0:42:27That means more families turning to already overburdened emergency departments for basic care. As we become the family doctor to the uninsured. This results in clogged emergency departments and inevitably longer wait times, which impacts not just medicaid patients and the uninsured, but everyone. In conclusion, in my written testimony, you'll see several specific solutions that can meaningfully improve value and affordability.
▶ 0:42:54And they focus on four areas improving the health of individuals and communities, advancing value through care transformation, reducing regulatory barriers and administrative waste, and driving innovation. We look forward to working with you and all stakeholders to advance solutions, and thank you for the opportunity. Again, Mr. chair. >> thank the gentleman for yielding back now recognized doctor david aisah's hope I said it right. >> pretty close.
▶ 0:43:22>> tell us how to say it so everybody else gets it right, even though I didn't. >> so thank you chairman griffith and ranking member degette, chairman guthrie, ranking member pallone and members of the subcommittee for having me here today. My name is david aisah's. I'm a board certified ophthalmologist with an independent ophthalmology practice in encino and west hills, california, and the chair of the board of trustees of the american medical association. Physicians want to care for all patients and ensure a healthy country.
▶ 0:43:53Congress can aid in this mission by recognizing that affordability is inseparable from access, and promote policies that ensure consistent, reliable and locally accessible physician care challenges surrounding patient access to physicians and healthcare affordability are multifaceted. They include market consolidation, inadequate physician payment, burdensome prior authorization rules, coverage and stability, and physician workforce shortages. The consequences are severe.
▶ 0:44:24Independent physician practices are closing, burnout remains high, and too many patients cannot find timely physician care in their communities. We are seeing a rapid transition away from independent physician practices into higher cost settings. This drives up spending for both families and federal health programs. In my community, I am having difficulty finding primary care physicians willing to accept new medicare patients.
▶ 0:44:49In fact, many physicians are charging patients an annual fee to enroll in their practices in order to keep their doors open. Congress can take several meaningful steps to shore up physician practices, stabilize patient access, and lower pressure costs across the system.
▶ 0:45:07First, congress should prioritize medicare physician payment reform, stabilizing medicare physician practice payment is one of the most direct ways that congress can protect patient access to care and counter further consolidation in the health care market. Physician payment has declined by 33% when adjusted for inflation since 2001. While practice costs have continued to rise.
▶ 0:45:32The solution starts with preventing the 2.5% medicare cuts scheduled for the end of 2026. Even small cuts have significant consequences for patient access. In addition, congress should reform medicare's outdated budget neutrality requirements to stop the annual cuts. Next, congress should establish a real inflation update tied to the medicare economic index to reflect rising staffing, technology and compliance costs.
▶ 0:46:02Moreover, congress must reform mips to ensure that small, rural and independent practices are protected from the steep 9% penalties and ensure physicians receive timely performance data. Second, congress should reduce administrative and regulatory burdens that take physicians away from patient care. Physicians are wasting too much time dealing with paperwork rather than caring for patients. Prior authorization and complex federal reporting programs take time, add cost, and delay patient care.
▶ 0:46:31Congress should pass the improving seniors timely access to care act and reform the medicare mips quality reporting program. Third, congress should promote competition and expand patient choice. Consolidation can negatively affect both cost and access, and congress should ensure the viability of independent practices. In addition, we need to remove existing federal restrictions that prevent physicians from opening or expanding physician owned hospitals.
▶ 0:46:57Congress should increase competition and patient access to care by passing legislation such as the patient access to higher quality health act. Fourth, congress must address the growing physician workforce shortage, which is currently projected to hit 86,000 by 2036. Fifth, as changes to medicaid move forward, congress and the administration should focus on the implementation that protects eligible patients from falling through the cracks.
▶ 0:47:25The ama is committed to helping ensure that eligible patients maintain health coverage and access to physician care. We encourage preserving coverage stability while also ensuring that physicians can sustainably participate in the program and care for our medicaid patients. In addition, implementation should minimize barriers for patients. America's physicians are committed to their patients.
▶ 0:47:50We stand ready to work with you to build a system that keeps practices open, that patients are cared for and costs are under control. Together, we can get this right, and we must thank you, and I look forward to the committee's questions. >> thank you. And it's your turn, Mr. martin, for your five minutes, sir. >> thank you so much, congresswoman.
▶ 0:48:10Chairman griffith, ranking member degette, chairman guthrie and ranking member pallone and members of the subcommittee, thank you for the opportunity to appear before you today on behalf of the american academy of family physicians, the aap proudly represents over 124,000 family physicians providing comprehensive care for patients of all ages and over 95% of us counties.
▶ 0:48:32Thank you for the opportunity to share thoughts on why healthcare has become more unaffordable, and to offer ideas for how we might reverse these trends and help individuals achieve better physical, mental and financial health. We as a population are unhealthy.
▶ 0:48:47Decades of policies have made primary care less accessible and affordable, and this has resulted in consequences higher prevalence of chronic disease, declining vaccination rates, low utilization of prenatal services, and growing numbers of unmanaged behavioral and mental health issues, to name a few. Our system will spend trillions treating and managing chronic disease, yet we will invest comparatively little in prevention and primary care, and primary care is not affordable.
▶ 0:49:15An annual primary care for one year is often less than one visit to the emergency room or one day in a hospital. I suggest that the most effective way to lower healthcare costs for individuals and for our system as a whole, is to improve the health of our population. And the best way to improve the health of our population is to strengthen primary care. Studies consistently show that primary care is the only area of healthcare that improves health outcomes, while reducing costs on a per capita basis.
▶ 0:49:46And sadly, the number of americans who have a usual source of primary care has decreased over the last decade. These trends are certainly a byproduct of consolidation, but also reflective of insurance design that has placed financial barriers between patients and primary care, particularly in the form of high deductibles and cost sharing. There have been meaningful bipartisan efforts to invest more resources in primary care over the past decade, including many by this committee.
▶ 0:50:12I would specifically acknowledge the important policies advanced by cms this past year as part of the medicare physician fee schedule, this type of leadership and these types of policies are consistent with our recommendations. Physicians are at their best when they're serving patients and communities, and not the financial interests of an employment or investment partner. Over the past two decades, we've seen a dramatic shift in practice ownership. Today, nearly 75% of family physicians are employed by hospitals or other entities.
▶ 0:50:4220 years ago, that number was closer to 35%. This shift has occurred for several reasons. First, insufficient and unstable payment policies from all payers, including medicare, have placed increasing economic pressure on physician practices.
▶ 0:50:59Independent practices often lack the market leverage needed to fairly negotiate payment rates with insurers, and the increasing burden associated with quality reporting, utilization management and practice improvement have increased the cost of operating an independent practice. While private equity is often viewed unfavorably, I would suggest that many of the business tactics associated with private equity are not materially different from those employed by hospitals or care delivery systems owned by insurers.
▶ 0:51:25Each seeks control over diagnostic treatment and referral decisions within primary care in ways that serve the financial interests of the parent organization, rather than always aligning with the interests of the patient. We are also concerned with the misaligned incentives within vertically integrated insurance organizations. Medical loss ratio requirements were designed to ensure that the most premium revenue is spent on medical care.
▶ 0:51:51However, as insurers have acquired physician practices, the lack of transparency has made it difficult to determine how much premium revenue is actually supporting patient care versus profits. I would offer six recommendations for your consideration.
▶ 0:52:07First, double the nation's financial investment in primary care and the primary care physician workforce to reform our flawed medicare physician payment system to more appropriately value the actual patient care done by physicians, and not just the facilities in which they work. Three establish regulatory frameworks that support independent physician led models, specifically direct primary care. Four create space for physicians to focus on patients by reducing the administrative complexity of the modern medical practice.
▶ 0:52:39Five remove financial barriers to primary care and six promote proven evidence based interventions, including vaccines, in our system. I will conclude with two thoughts. Healthcare consolidation has led to higher costs, decreased access to care and universal frustration. And to truly reduce the cost of health care, we must invest in health and health starts with primary care. Thank you for the opportunity to be here today, and I look forward to your questions.
▶ 0:53:11>> thank you, Mr. martin. And now, miss mitchell, you're recognized for five minutes. >> thank you. Chairman guthrie and griffith, ranking members pallone and degette and members of the committee, sincere thanks for the opportunity to testify today and to share the experiences of large, self-insured employers and public purchasers of health care as they seek to reduce health care costs, improve quality and increase access and affordability for their employees.
▶ 0:53:37Over 180 million americans receive health insurance coverage through their employer, and they rely on the commercial market to ensure that care is affordable and high quality. However, that is increasingly difficult. Soaring costs quickly turn a medical emergency into a financial disaster. Affordability for american workers is reaching a crisis point. My name is elizabeth mitchell. I run the purchaser business group on health.
▶ 0:54:00We are a nonprofit coalition of jumbo self-insured employers and public purchasers, collectively spending over $350 billion annually purchasing health care for about 25 million americans. Pbj facilitates employer led innovation in the commercial market, and for nearly 40 years, we have worked directly with purchasers and health care providers and practices to improve quality and affordability through active purchasing strategies and actions, our members have implemented employer led innovations that deliver real
▶ 0:54:31Results, including joint hmo purchasing that reduced premiums by over 9%, advanced primary care initiatives that saved hundreds of millions of dollars and avoided tens of thousands of hospital admissions. And we have also done some of the nation's earliest centers of excellence programs that dramatically improved outcomes and cut costs. More recently, we have worked to combine price, quality, safety, and claims data to support value based purchasing.
▶ 0:54:57In short, we know what it takes to deliver high value care, and we appreciate this committee's leadership on affordability. However, while employers and purchasers are leading the way on innovation policy, intervention is necessary to address the anti-competitive business practices and restore a functional market. The healthcare industry has been largely unresponsive to the concerns of employers and patients, erecting barriers to access and affordability and stymieing innovation.
▶ 0:55:23When this happens, american businesses, workers and their families are the ones left holding the bill, and the committee should be crystal clear. Self-insured employers and workers are paying these health care costs. Health plans simply administer payment with other people's money, keeping a large portion for themselves. But this is money coming out of businesses and wages. But there is good news. We know what works.
▶ 0:55:49Evidence based strategies can improve care while lowering costs if they are scaled and supported. Based on our experience, we urge three priorities. First, ensure meaningful price and quality transparency so that purchasers and patients can make informed decisions. Second, redirect resources to underfunded high value care, including primary care, maternity care and mental health.
▶ 0:56:13And third, stop the anti-competitive business practices enabled by consolidation and strengthen policies like site neutral payment and anti-competitive contracting reform that restore competition and accountability. Employers have demonstrated that they are prepared to confront the health care cost crisis, but they cannot do this work alone. By advancing these reforms, congress can directly improve affordability and quality for more than half of the country through market based solutions.
▶ 0:56:40Thank you for the opportunity to testify and for the committee's leadership on health care affordability. We look forward to working with congress to advance transparency, competition and market based solutions that lower costs and improve care for american families. >> thank you, miss mitchell. And now I'll recognize doctor digiorgio for his five minutes. >> thank you, madam chairman griffith, vice chair, harshbarger. Ranking members to get and members of the subcommittee. Thank you for the opportunity to testify today.
▶ 0:57:10I'm anthony digiorgio. I'm a practicing neurosurgeon at the university of california, san francisco. And the views I express here today do not necessarily represent those of ucsf. I clearly don't need to belabor the points about healthcare affordability. If we're serious about fixing fixing this, we must look squarely at consolidation and the policy choices that have accelerated it. And I want to be clear, the answer is not weaker hospitals. We need strong hospitals for emergency care, trauma care, teaching transplant services and true safety net functions.
▶ 0:57:37I work in that world and I believe in that mission. But we also need a strong, independent physician sector. Independent physicians and physician led facilities are one of the last practical checks on consolidation in american health care. They preserve patient choice, create local price competition and maintain accountability through direct patient physician relationships, rather through distant than through distant corporate hierarchies. Yet over time, regulations have eroded the ability of independent doctors to maintain their practices.
▶ 0:58:07Just like any industry, this consolidation has led to significant price increases, hospital acquisition of independent practices and vertical integration are associated with higher prices and higher medicare spending, along with lower wages for nurses and other workers. And despite the usual promises, the evidence does not show that consolidation reliably improves quality.
▶ 0:58:28Congress must revisit policies that have restricted physician led entry section 601 of the affordable care act essentially prohibited new physician owned hospitals. This is removed one of the few physician led entries that could have checked consolidation. However, there's ample evidence that physician owned hospitals provide high quality care. They're consistently ranked among the highest quality hospitals, while improving access in underserved communities. That alone is enough to justify repealing section 6001.
▶ 0:58:59Additionally, stark law acts as though every physician led ownership arrangement is presumptively suspect. Independent physicians should be able to build lawful ancillary capacity, participate in joint ventures, and coordinate care without hiring a battalion of lawyers. Just to understand whether ordinary business planning is allowed. If policies policy makers are worried about weak utilization control in fee for service a legitimate concern given the levels of fraud that are coming to light and exception to stark law, could be made within a managed care setting.
▶ 0:59:27Section 601 and stark create an untenable double standard. Corporate health systems are granted broad, safe harbors that allow them to anti-competitively steer referrals within their system. Why should independent doctors be subjected to prohibitions on self-referrals when corporations are not? Additionally, cms pays vastly different amounts for the exact same clinical service, depending solely on the ownership structure of the building where the services is rendered. This structural flaw transforms health care delivery into a massive exercise and payment policy arbitrage.
▶ 0:59:57As an example, medpac showed that an echocardiogram is reimbursed 194% more in a hospital than in a freestanding office. An independent medical practice is often worth significantly more to a corporate hospital system than it is to the independent physician owner. Due to the site of service differential and the captured downstream referrals for a truly independent practice, medicare compliance is a substantial burden.
▶ 1:00:20For example, just to report cms mandatory quality metrics, outpatient physicians spend about 2.5 hours weekly on reporting, and non-physician staff spend another 12.5 hours. Additionally, medicare's conditions of participation actively prohibit price transparency. Under current rules, physicians are not allowed to offer cash prices for medicare beneficiaries. This.
▶ 1:00:41These prohibitions stifle the ability of physicians to innovate on payment design, creating transparent upfront pricing mechanisms that would empower patients that all or nothing structure makes patient centered payment innovation harder than it should be. Moving towards flexible private contracting and payment models is preferable to simply applying another fix to the physician fee schedule schedule. But as long as congress keeps physicians inside a prospective payment system, it should at least stop using that schedule in a way that destabilizes independent practice.
▶ 1:01:06The system effectively starves independent practices of revenue while burying them in paperwork, making selling to the hospital the only viable way out. Congress must also confront the distortions and abuses in the 340 b drug pricing program. The availability of 340 b discounts to hospital child sites, but not independent practices creates yet another means of financial leverage for hospital systems to acquire clinics. Congress should use the power of the medicaid matching percentage to incentivize competition in states.
▶ 1:01:33States that continue to protect incumbents through certificate of need laws, broad physician non-competes and pro consolidation, state directed payments or other barriers to physician led entry should not receive the same federal matching treatment as states that permit real competition. We need a thriving independent physician sector.
▶ 1:01:50If congress continues to kick the can down the road or rely only on band-aids, the us health system will continue consolidating into a top down market dominated by a handful of vertically and horizontally integrated monopolies, and the american patient will be the one paying the price. Thank you. >> thank you, sir. And now I'll recognize miss merrill for her five minutes. Thank you, vice chair. Harshbarger. Yeah. I think it's not turned on yet.
▶ 1:02:22Is it green? Can you hear me now? We can hear you. Fine. Thank you. Um, vice chair, harshbarger, ranking member degette, members of the committee. It's an honor to be here. Thank you.
▶ 1:02:35I'm barbara merrill, ceo of anchor, a national association representing more than 2500 private, mostly nonprofit organizations that deliver life enhancing, cost effective home and community based services to people with intellectual and developmental disabilities or id. I want to spend my time today telling you about just one of those providers, d d c.
▶ 1:03:01Since 1964, drc has supported coloradans with disabilities in the denver metro area through services like early intervention, residential support and employment training. The impact of hcbs is evident to people like susan hartley, whose son cameron was diagnosed with a rare seizure disorder at just six months old.
▶ 1:03:24Susan was a 22 year old single mother when she was told her son would probably only live to the age of three, and that she should consider institutionalizing him. She refused and years later connected with her local community center board, which helped the family access therapy services and help get cameron on the waiting list for medicaid funded hcbs. But the wait took years.
▶ 1:03:50While I waited, life was so difficult, susan told us. She pawned what she could and she missed mortgage payments to cover cameron's therapy and medical bills. Susan continued, but when we finally got off the wait list and received medicaid, our lives changed dramatically for the better. Hcbs enabled susan to keep on working. Despite cameron's need for round the clock care.
▶ 1:04:19As she put it, I was actually able to focus on him and his therapy needs versus how I was going to pay for it while keeping a roof over our heads. Cameron passed away in 2017 from complications of his disability, but thanks to drc and hcbs, he lived to the age of 35 and he spent his entire life in a loving home. We hear stories like susan's and cameron's every single week.
▶ 1:04:50That's because home and community based services make it possible for people with id to carry out daily activities of living, build skills, find and keep jobs. They also allow loved ones to remain in the workforce.
▶ 1:05:06These id services, which can only be accessed through medicaid, accomplish all of this at an average cost of $70,000 a year per person, a fraction of the cost of the alternative, which is to support people in large state run institutions at an annual cost of $395,000 a year.
▶ 1:05:30Despite these services being the preferred and the most cost effective option, numerous barriers threaten their sustainability. For starters, these services are not mandatory, meaning states decide whether to offer them and to whom. Chronically insufficient reimbursement rates have for decades made it extremely difficult for providers to recruit and retain direct support professionals.
▶ 1:05:57Workers who can earn more working in fast food and retail jobs. Together, these factors explain why there were more than 550,000 americans with id on state waiting lists in 2025. Now, new threats stand. To make things worse, last year, id service providers were told repeatedly that the medicaid funding cuts included an h.r.
▶ 1:06:26One would preserve access for the most vulnerable and wouldn't impact disabled americans. Yet when federal medicaid dollars to states are limited through changes to provider taxes or state directed payments, states often turn to cuts in optional services like hcbs. Numerous states this year are already proposing to cut directly from id services to overcome budget shortfalls.
▶ 1:06:54One state, idaho, has even proposed eliminating hcbs services altogether. Given these barriers, we must ensure that every dollar that we spend reaches people in need. That's why anchor shares in the goal of ensuring that medicaid is free from waste, fraud and abuse.
▶ 1:07:12But such efforts must be precise and targeted, cutting off funding from all providers of a given service serves to threaten the most vulnerable people in their families, and runs counter to the goal of saving taxpayer dollars. In conclusion, discussions about healthcare affordability must recognize the crucial role of hcbs investments that prevent people from needing costlier, more intensive care.
▶ 1:07:38Therefore, the best way to help to lower healthcare costs and improve outcomes for people with disabilities is to strengthen home and community based services so they can keep on supporting families like susan and cameron's building a stronger america for everyone. Thank you, thank you ma'am.
▶ 1:08:01We'll now begin questioning, and I'll ask members not to begin a new question to our witnesses as their five minutes expire, and would encourage members to submit written questions. For the record, I now recognize myself for five minutes, and I want to start with doctor aziz. Right. I want to ask you about an issue that directly affects physician supply, patient access and health care costs.
▶ 1:08:23And, you know, I'm a sponsor of fair access and residency act in congress. And I've been examining persistent discrimination against doctors of osteopathic medicine in federally funded residency programs. Dos and mds hold equivalent licenses, yet nearly 75% of programs still require students to take the usmle. In addition to the complex. And surveys show that students report bias in residency match.
▶ 1:08:54While nearly 30% of programs seldom or never interview dose, the ama itself has acknowledged this discrimination as a real concern. But despite years of discussion within the house of medicine, the problem remains since medicare spends over 20 billion a year in funds, the majority of residency slots. Barriers like this can restrict the physician workforce and ultimately affect patient access and affordability.
▶ 1:09:18So my question is, why hasn't the medical profession done more to solve the problem with such little progress? And why shouldn't congress act to increase transparency in medicare funded residency programs, to ensure docs are treated fairly, and that patients benefit from the full physician workforce? Sir? >> thank you for the question. In the eyes of the american medical association, an md and a d o is equivalent. There is no difference, right?
▶ 1:09:47So I can't speak to any kind of discrimination that's occurring in academic centers for residencies, but there is no organized effort to discriminate between allopathic and osteopathic physicians. As I said, in our minds, they're equivalent. We have a member of the board of trustees who is an osteopathic physician.
▶ 1:10:06And, um, I would suggest that this is work that needs to be done in individual academic centers to ensure that they treat all applicants with equivalent credentials equally well. >> if nearly 75% of programs still require them to take the usmle.
▶ 1:10:25In addition, you know, to the complex look, and if you've got 30% of those programs seldom or never interviewing those dos, if you've acknowledged the problem, then you need to fix it. So that's just my suggestion, sir. Miss mitchell, there you are in the middle. Uh, the 340 b drug discount program was intended to help vulnerable patients like the uninsured and underinsured patients.
▶ 1:10:51But the nonpartizan congressional budget office has found that hospitals can buy drugs at deep discounts while charging commercial insurers and patients much higher rates and keeping the spread. Cbo also found that current 340 b incentives are likely increasing federal spending, driving up costs through the use of higher cost drugs, reduced insurer rebates, and more vertical integration.
▶ 1:11:13From the perspective of employers who finance a large share of private coverage, are these incentives raising costs for purchasers? And should congress consider stronger transparency and guardrails to ensure the 340 b is benefiting patients, rather than inflating costs in the commercial market? Because myself and my colleague buddy carter have legislation about. Three £0.40. >> thank you for the question.
▶ 1:11:41Um, the 340 b program, as you know, was intended to support safety net hospitals. But as you've also noted, it has expanded beyond its original intent. And we do believe it is driving up costs in the commercial market as well as for public payers. Yeah, we fully support more transparency to get a better handle on what's happening and why, and really identify strategies for savings. >> yes, thank you ma'am. Mr.
▶ 1:12:07Martin, from the perspective of family physicians, what are the steps should congress consider to strengthen workforce capacity by better utilizing the providers already in the system? >> yeah, I think thank you for the question. Um, one, we think there needs to continue to be decentralization of training opportunities, not that physicians should not be trained in hospitals.
▶ 1:12:25That is the most appropriate place for some physician specialties for primary care and for other specialties programs such as the teaching health centers, supporting programs that allow for scholarship and loan repayment based upon rural training tracks and other opportunities have the potential, and they have been successful in many parts of the country. I may, if I could answer your question, um, we are we have almost 20,000 osteopathic physicians in our membership.
▶ 1:12:52We're one of the largest osteopathic organizations in the country. And I think that issue is largely specialty by specialty. As the residency review committee set up their criteria for applications, I think there is wide variation. I don't think that discrimination is taking place across the gme platform. >> well, you need to talk to the good doctor out of you and you'll get that. >> I think we agree. I think we agree. >> okay. I think my time is up.
▶ 1:13:20So I will recognize the ranking member, miss daggett, for her five minutes. >> thank you so much. First of all, I want to welcome you, doctor digiorgio, um, and tell you, my daughter rafaela is on faculty at ucsf in internal medicine, so maybe you can get to know her. Um, thanks to the hr one, which is the big bad bill. Um, all of our states are being, I call it big bad bill because of illiterates. Right.
▶ 1:13:48Um, in colorado, what that means is a 14% reduction in federal medicaid funds. And that's money, as you heard in the testimony goes for sick kids keeping people with disabilities in their communities and providing coverage for folks. Um, and now they're trying to scrambling to, to how they can fund these already lean programs. So, miss merrill, I really want to thank you for sharing susan and cameron's story to coloradoans that are really being impacted by this.
▶ 1:14:17And I'm sure you know, and the rest of you know, lawmakers are really looking at cuts to caregiver services and programs to keep people in their homes and communities. Can can you, miss merrill, delineate some specific types of services that are getting cut in colorado and elsewhere? >> there we go. >> absolutely. >> thank you. >> um, we're really.
▶ 1:14:47>> worried about what's happening in colorado. We're worried about what's. >> happening, right? >> what's specific types of services are being cut? Uh. >> let. >> me share, um, uh, cuts that are already on. >> the. >> table are, um, provider rate cuts to certain services, soft caps to services, reducing enrollment on the developmental disabilities waiver.
▶ 1:15:10Um, but the legislature, we understand, and this is the information we got as, as, as recently as last night, the legislature is also considering deep across the board cuts, um, to provider rates. Yeah. >> okay. Thank you, madam chair. I ask unanimous consent to put this april 16th, 2025, study in health affairs about what sorts of services are first to go when budgets are cut in the record. >> without objection. >> so ordered. Thank you.
▶ 1:15:39Um, now, I want to say that in, um, my district, which is denver, colorado, nearly half of the patients at denver health are on medicaid. According to a conservative estimate, 20,000 denver health patients will lose medicaid as a result of h.r. One, the big bad bill. So I want to ask you, Mr.
▶ 1:16:02Pollack, people without insurance often go to the emergency room rather than getting care earlier and in cheaper settings. Is that correct? Correct. And it's not like those people suddenly don't need health care. It's like they can't afford to go, so they just don't go. Is that right? >> yes. As I said earlier, we become the family doctor to the uninsured. >> and but the but but in fact, they're not coming for preventative services. So in fact, they're sicker and that's more expensive. Is that correct?
▶ 1:16:33>> correct. >> now, um, in, in um colorado, the colorado hospital association estimates that h.r. One might cause colorado hospitals to close and, um, their, their spokesperson said it's existential for some in this recent senate report, they say six colorado hospital hospitals, mostly rural, are going to be threatened with closure.
▶ 1:17:01Uh, would that surprise you that hospitals like this are are feeling the threat of being closed because of this bill? >> no. And we've been very vocal in expressing our concerns relative to the impact of the significant medicaid cuts that are now coming down the pike. And so it's an enormous concern. And cbo suggests 7.5 million people will lose coverage as a result of that, and they all end up in the e.d. We want to work to prevent people from getting there so they can get preventative.
▶ 1:17:32>> and when the hospital's closed, that has a repercussion throughout the community, especially when it's a rural and underserved community. Isn't that right? >> that's correct. >> now, um, I'm also concerned, and you alluded to this, that when, when people go into these emergency rooms in these hospitals, that actually all the costs for insurance go up for everybody, is that correct? >> yeah.
▶ 1:17:57Um, there is cost shifting as a result of government underpayment, not only in medicaid, but in medicare as well. But the real concern that we also have is that it will just clogged already overburdened eds, and there'll be longer wait times. And that affects everyone, right. >> and worse health outcomes. >> certainly if people don't get the care on the front end that you could have prevented, and then they end up at the e.d. That's not good for the patient. >> great. Thank you.
▶ 1:18:26Thank you, madam chair, I yield back. >> gentlelady yields back and I will recognize the chairman of the full committee. My friend Mr. guthrie from kentucky. >> thank you very much. And I kind of got started in my opening statement on some things I want to talk about. But first, I know miss meryl recognizing the the one big, beautiful bill. We had the largest investment in community based services at $8 billion over $8 billion. I know states have the choice to do what they want to do. We want to put federal incentives.
▶ 1:18:53The other thing that people are talking about was the way that states fund their portion of medicaid, and they do it in a way that puts most of the burden back on the federal taxpayer. And we want states to take responsibility like they committed to when they first went forward. And so we'll see what states priorities are as we move forward in this. Um, so Mr. pollack, I talked about my wife's, uh, six hour stay in the hospital being $28,000. I'm not sure the hospital received $28,000, nor do I think the insurance company probably paid $28,000.
▶ 1:19:22We're seeing and it just seems pervasive in the health care system. We just looked at, uh, rebate model on pharmaceuticals where there's a high, high list price, but that's not what's actually paid and it just distorts the whole market. And are we not seeing similar effects where plans and providers have incentive to increase price, regardless of what the service may actually cost? >> well, you know, when we talk about price and we talk about the bill that you referred to, that was 27,000 or.
▶ 1:19:53>> 28,000 for six hours. >> yeah, that's a list price. Um, we are price takers. We, we don't have the, we're not getting that. It's a negotiated rate that we get with the insurance companies. And for government payers, we get a rate. So none of that is the reality. And as you suggest, it was $500 at the end of the day. Um, so that's the way the system is. >> that was $500 from us, right.
▶ 1:20:21But somebody paid more than $500 for that. Right? That's the problem is the system. When we're trying to get price transparency, you can't figure out what anything costs. And so and I'll go to to miss mitchell on it is that's I always thought that the way you're going to deal with this is, uh, because, you know, there's a choice. I mean, you had great care. They were great facilities. Both both of the instances I talked about great, great facilities. We want that. So if if employers finally throw their hands up and say, this is just beyond this is just crazy.
▶ 1:20:49So let and they surrender, then we end up with a different system that one of my colleagues talked about this morning, I don't think would have the same great hospitals that we have. So I'm bragging on the care that she got. It's just the way that this this system works. And so to get, you know, an individual calling around and saying, how much does this cost has an impact, but not like if, if a big employer with a lot of covered lives do it. So when I first got this, this, this position I started, we really want to focus on this. And you start talking to big employers.
▶ 1:21:17There was one instance I know there was a 700% markup on a pharmaceutical, and it was an automotive supplier. And I, I know the automotive business. I said if, if an automotive supplier produced a product with a 700% markup that went into an assembly plant, they had fired their buyer. But yet the human resources department, it turns out nobody knows what anything costs. And so you put together an organization.
▶ 1:21:39So I just want to you to kind of talk about, um, just how data is there, how, how, how can employers even figure out what things cost, what's out of pocket if they're just sending checks when they have no idea if it's really covering what they want to cover or not, and seem to be covering a lot of other people's costs as well. When they do this, you just kind of explain what's going on in the employer market. And jamie dimon said he wanted to fix it for his bank and couldn't. A very sophisticated financial organization couldn't get to what everything cost.
▶ 1:22:10>> well, thank you for the question. And it is a critical challenge right now in us health care. Pricing is utterly irrational and it is not related to quality. It is not related to safety. It's basically whatever a hospital can charge and get away with. That is one of the reasons congress passed health care price transparency about five years ago. Unfortunately, we do not have adequate compliance from the hospitals to share their prices.
▶ 1:22:33So a basic step forward would be to require them to fully comply with the existing rules and make the price information totally available. Because to your point, you can't make an informed decision without information. So self-insured employers who bear 100% of the risk want to pay a fair price for high quality care, as is their fiduciary responsibility. Without that information, though, they can't do it.
▶ 1:23:00It is still far too challenging to get basic. >> how do you get beyond. And we worked on this bipartisan actually, we had it in the bill last year. It ended up being just for pharmaceutical. It didn't really get into the pbm, didn't really get into the hospitals after it got out of the senate. But how do how do you keep from having. Well, you're if I'm an employer and somebody says you just paid. Say you paid half, you paid $14,000 for a $28,000 service. And it wasn't really $28,000, did they? How did employers know what that is?
▶ 1:23:29I know I got 10s, I'm sorry. >> I will say we are now making that information, those prices available to our members, they are using it in. >> what if the price is $28,000? They see. And it's not the real price? >> well, that is a challenge. And they have to have full transparency into what goes into those prices and how it relates to quality and outcomes. It is much more difficult than it should be, but employers are and will continue to use that information as it's available. >> well, thank you, I appreciate it.
▶ 1:23:58I hope we can work together on this, and I plan to I yield back. >> gentleman yields back, and I now recognize the ranking member of the full committee Mr. pallone. >> thank you, madam chair. Again and again we've heard what I consider false claims from the republicans that they're medicaid cuts would not harm people with disabilities. And they argue they can cut nearly $1 trillion from medicaid and their big, big, bad bill.
▶ 1:24:24Uh, but people with disabilities who rely on medicaid for their health care nonetheless wouldn't get hurt. And it's not true. The reality is simple. You can't cut as much as 20% of federal medicaid funding from a state's budget and expect that people's care won't be impacted. It's just not possible.
▶ 1:24:41I was at my governor's stated budget address last week in trenton, and she was talking about a $2 billion structural deficit, much of which is from the medicaid cuts. So the reality is this is going to hurt people with disabilities. Now, miss myrl, I want to hear from you and the providers you represent.
▶ 1:25:04Um, you know, what's what is being played out for people with intellectual and developmental disabilities as these cuts begin to take hold, if you will. >> thank you. >> thank you for the question. Um, I'd like to start by painting the picture of how incredibly fragile our community delivery system is. To begin with.
▶ 1:25:26>> I wanted to particularly focus, though, on the kinds of cuts that are hitting home and community based care because, you know, we worked hard over the years to prevent people with disabilities from being institutionalized. And I'm afraid that that's going to be reversed. Now, if. >> you that's exactly what we're concerned about.
▶ 1:25:42And we saw that during the great recession, when state budgets were under extreme constraints, um, during that time period, you know, in every single state in the country, um, and the territories we saw, uh, really pretty deep cuts to home and community based services because they're mandated, because they're not mandatory, because they're optional.
▶ 1:26:06Um, you know, we start out in a very, very fragile position, um, because of stagnant, um, really insufficient reimbursement rates for decades. Um, you know, our members, providers of services for people with disabilities who are also price takers, we do not set the prices, um, our members, providers of services for people with intellectual and developmental disabilities rely almost 100% on medicaid.
▶ 1:26:36There's no opportunity to cost shift to commercial insurance to medicare. It is all 100%. But I. >> don't want to cut you off, but I wanted to ask another question too. Um, does this mean that people are going to end up, you know, not being able to stay home and are going to have to be we're going to see the reverse. >> absolutely, absolutely. And that was the point of the story of susan and cameron.
▶ 1:27:01Already we have 552,000 people on waiting lists across the country, and that's before states have to start making really difficult decisions when they're going to have a whole lot less federal funding coming. Now we're going to see waitlists get a lot bigger. We're going to see a whole lot more people, um, winding up in emergency rooms at a cost of 3200 a day. We're going to see what we what we're already seeing.
▶ 1:27:30I mean, that's really the point. You know, the system is already super strained, right? And then one more thing is just going to make it worse. >> now, the other thing we were talking about the medicaid cuts, but the other thing we're seeing from the, uh, from this administration is direct attacks and cutting funding for services themselves, not just the medicaid cuts, but just cutting funding for the services.
▶ 1:27:54So minnesota, for example, the trump administration took action to cut off all federal funding for services, including some of the disability services your members provide. So just tell me a bit about the services that anchor providers deliver in minnesota that the trump administration has acted, withhold all funding for, and what that means to cut off federal funding for this care. And there's only a minute left. But whatever.
▶ 1:28:17>> well, let me just start by saying that, um, that fraudsters there isn't an anchor member, um, that isn't as horrified as every member of this committee is um, by fraudsters, by criminals, um, you know, who divert money away from a system that really badly needs it.
▶ 1:28:34Um, in minnesota, um, as, as a result of actions that have not been targeted, they haven't been precise, um, providers of services for individualized home supports, you know, the types of services that allow people to stay at home, the cost effective, you know, cost saving services. Um, you know, those services were put on payment holds.
▶ 1:28:56And we're talking about a whole lot of small providers who don't have the wherewithal, don't have that financial capability to go for very long without being paid. And that's exactly the type of risk that is a type of service that is at risk. And that's why it's just really crucial that, you know, as we address fraud, that those efforts be super targeted, they'd be super precise. >> thank you. Thank you, madam chair. Oh thank you, Mr. chairman is back.
▶ 1:29:27>> thank you very much. Um gentleman yields back. Now recognize the gentleman from florida, Mr. bilirakis. Thank you. >> Mr. chairman. I appreciate you holding this, uh, third hearing on affordability with regard to health care, while we focus on the topic of providers today, I'd first like to take the opportunity to recognize the important work of many providers in my great state of florida, my district, like many of my colleagues here, uh, has a blend of larger hospital
▶ 1:29:58Systems, safety net providers like community health centers and independent physicians. And each of these play a critical role in health care delivery. For example, baycare opened the first and only behavioral health urgent care in florida in new port richey, florida, in early 2025.
▶ 1:30:18Just like a traditional urgent care, they are a no important appointment needed resource for anyone in the community, whether they have insurance or not. Really incredible stuff. The success of this program has been remarkable, and yet many of the services are not reimbursed by the federal government.
▶ 1:30:39I also represent represent several independent medical practices and physicians who serve as the first line of defense for many patients in the the office based setting. Uh, yet due to misaligned reimbursement in the physician fee schedule, independent practices are closing and consolidating.
▶ 1:31:04Unfortunately, we must pursue balanced reimbursement policies to meet patients earlier in the healthcare system. I'm proud to lead efforts to reassign again, realign reimbursement for office based services. So my first question is for doctor jaeger. Dg I'm sorry. It's okay. Giorgio, I know better. Something's ringing in my ear. I apologize. Uh, somebody's calling me.
▶ 1:31:30So your testimony discusses the loss of independent practices in addition to reimbursement policies. Can you elaborate further on the major factors driving this loss? >> so I think the loss of independent practices, uh, have largely been due to multiple factors, such as the site of service differential and the 340 b program as being two major ones.
▶ 1:31:54The ban on physician owned hospital obviously is a barrier to entry in the hospital space for physicians. And then as well as stark law, creating undue compliance burden for independent practices as well. So they're all contributing and I think all need to be tackled equally. >> thank you. I appreciate that question to Mr. martin, your testimony highlights the importance of community health centers. Can you share more on the role of family physicians at the chc?
▶ 1:32:22How do differing facility reimbursement rates impact provider participation and vertical integration in the physician marketplace? >> yeah, thank you for that question. So we're proud to partner with our community health center colleagues about somewhere between 60 and 18% of family physicians work in a community health center. They are the prominent physician workforce, along with their clinician, colleagues and community health centers.
▶ 1:32:48And we view the role of community health centers as becoming more important in particularly rural communities, other underserved communities, as the marketplace become, um, as the loss of independent practices. We see community health centers filling a lot of that, um, primary care need. So similar to what's already been said, we see a number of factors driving consolidation in primary care. I think the other side, differential payments certainly was an accelerant in many communities around the country.
▶ 1:33:19But the unpredictable nature of medicare and medicaid reimbursement certainly also has played an important role. And I do feel we we saw the largest consolidation of family medicine around the high tech act, which is really more of an administrative complexity. Um, criteria were practiced just simply couldn't afford the compliance associated with those regulatory requirements at that time. So it's a combination of things, but we do see physicians moving around, leaving rural communities and leaving other communities.
▶ 1:33:49As consolidation happens, they go seek employment opportunities in other places. >> yeah, unfortunately, we have to do something about that and get the word out on how these centers or the quality of care is outstanding and they're accessible as well. So big fan of community health centers. All right, Mr. chairman, I yield back. Thank you. >> gentleman yields back. Now recognize the gentleman from california, doctor ruiz for his five minutes of questioning. Thank you. >> Mr. chairman.
▶ 1:34:17Look, um this is this is this is very rich. Um, you know, the majority is called the hearing on the high cost of health care while flat out denying the elephant in the room. Uh, you know, this is, this is a problem exacerbated by their making. I'm an emergency medicine physician. And what we do really well is to treat the acute crisis in the emergency department.
▶ 1:34:41And what we're doing right now is we're ignoring the gunshot wound and talking about the liver problems. We have to treat the patient. Our health care system is in a crisis right now. It's in a crisis because of the tariffs. It's in a crisis because of the one big, beautiful bill also known as the big ugly law. It's in a crisis because they adamantly refused to extend the affordable care act tax credits.
▶ 1:35:12All of these things raise costs for the patient. A lot of us here discussed how to lower overall costs for programs for institutions, but our focus always has to be how do we lower the out-of-pocket cost for patients? That's who you all work for. That's who I work for in the emergency department is are the patients. And so how are we going to do that when we have a pay?
▶ 1:35:39The healthcare system has just sustained gunshot wounds to the chest and the abdomen with the one big, beautiful bill that cut nearly $1 trillion out of medicaid. When these guys voted against and intentionally did not extend the affordable care act tax credit, that's going to raise premiums by 18,000 a year for some.
▶ 1:36:05For many of my constituents, what happens when you with those actions, you're going to have 15 million more people uninsured. That's going to be uncompensated care, sicker patients not able to go to the primary care, not able to look at price transparency. They don't give a about consolidation right now when they're sick. They need health care now.
▶ 1:36:32And when they don't get it because they can't afford their health insurance, or they just took it away because of the medicaid cuts, they're going to go where Mr. pollack, the emergency department, that's going to be uncompensated care for you. Now, how which departments do hospitals have to cut in order to manage their care? >> obviously depends upon each individual hospital.
▶ 1:36:59>> which are the departments that are not the money makers in a hospital. >> um, generally the low margin ones would be behavioral health. >> one. >> um, obstetrics. >> labor and delivery. Yep. >> and infectious disease. >> infectious disease. What else? >> those are probably the main. >> you know, pediatrics is also one of those that. >> are, I should have mentioned. >> that you should have mentioned that. Absolutely. Because those are the departments that get cut from a hospital. So it doesn't give a nobody gives a rat's whether they're on medicaid or not.
▶ 1:37:27If you have medicare, medicaid, or private health insurance, if the hospitals don't provide those services, you're out of luck. You're out of luck, okay, because you're not getting the care. They cut health care in addition to that, when those hospitals cannot get, uh, cannot make the bills after you've eliminated those programs, what's next for a hospital, Mr. pollack? >> well, some of them are threatened with closure.
▶ 1:37:58>> closure. So when there's closure, is there an emergency department? Mr. pollack? No, no, there's no emergency department. Right. So when somebody has a stroke or somebody has a heart attack and there's no emergency department, what does that do to the risk of permanent injury or death? Doctor aziz. >> rapidly, dramatically increases it.
▶ 1:38:21>> so now suddenly people in our community, whether you have medicaid, medicare, private insurance, are going to be at risk for dying or permanent injury injury if they have a stroke or a heart attack. That's the crisis in the room. Because of the unaffordability caused by the one big, beautiful bill known as the big ugly law. Now, how are you going to pay for this uncompensated care? You're going to renegotiate drug prices with the insurance companies, aren't you, Mr. pollack? The hospitals will.
▶ 1:38:51>> we're going to have to make a lot of changes. >> you have to make a lot of changes and renegotiate the the reimbursements with insurance companies. Right. >> among other things. >> among those things. I asked seven ceos in this room. They said, yes, that's how they're going to cover the uncompensated care. So guess what they're going to do? They're going to raise premiums. They're going to raise premiums across the board for employers, for small businesses, for people with private health insurance. So suddenly everybody is paying more.
▶ 1:39:23That's the gunshot wounds to the body coming into our emergency department that we have to take care of. Let's stabilize this patient by reversing these damages. And then let's talk about consolidation, workforce problems and full parity with mci, with other providers tying physician reimbursements to mci fully. Thank you. >> gentleman. Yields back. Now, I recognize the other gentleman from florida, my good friend doctor dunn. >> thank you very much, chairman.
▶ 1:39:51Uh, and thank you to our witnesses today for for for being here. I want to raise a bill. I coauthored, if I may, h.r. 4299, the protecting patient access to cancer and complex therapies act. This bill addresses, uh, the negotiation provisions in the I r a the inflation reduction act that relates to, uh, drugs often administered or infused in independent community settings.
▶ 1:40:18This setting of care is one that we have to work to protect as it provides critical points of access for patients across the country, delivering high quality of care in a cost effective manner. Under the ira. Provisions in negotiation is synonymous to a direct reimbursement cut to providers who are already facing significant financial pressures.
▶ 1:40:43Uh, recent analysis by avalere projects, uh, shows that on average, independent providers are going to face a 47% cut in their reimbursements. Uh, and this is specifically a lot of part b medicines that makes stocking and administering these life saving therapies a net loss. And, uh, you know, forcing difficult financial decisions on, uh, on physicians in that situation.
▶ 1:41:09This bill provides a very simple technical fix, replacing direct provider reimbursement, replacing the direct provider reimbursement cut with a back end rebate by the manufacturers to cms. And this will allow the system to the patients to still see the benefit of price reductions while removing the physician from the equation.
▶ 1:41:35Without that fix, though, the lack of reimbursement is sure to become another critical factor forcing consolidation again of care and more expensive and less patient centric care. Doctor aziz, um, can you provide some perspective on what additional reimbursement cuts might mean for patients? >> well, the physicians in america are in a crisis in terms of reimbursement and payment.
▶ 1:42:03As you've heard, costs are rising dramatically, whether it's the cost of insurance, the cost of rent, the cost of employees, the cost of everything we do to maintain our practices as a business and keep them open. And the that crisis is what's accelerating further consolidation and independent practices to go out of business. So anything that will help prevent that from occurring, uh, is beneficial to the survival of independent. >> that was, that was my experience in practice as well.
▶ 1:42:34Mr. pollack, uh, hospitals play a central role in providing care for complex emergent and emergency cases. How are hospitals responding to this growing number of physician practices that are being acquired and consolidated for financial purposes? >> yes. You know, one of the things that's important to, uh, look at when you see this issue is that hospitals really are not their major drivers in acquiring physician practices.
▶ 1:43:01Over the last four years, the increase in hospital in physician practices has been an acquisitions has been by private equity. >> yeah, I've noticed that. >> I've noticed. And second to that has been medical groups. Third to that is insurers. And where the last 6% increase. Now what's important to remember is that we recognize that physician employment is not the only model. And there are a lot of different ways to affiliate with our physician partners.
▶ 1:43:32But sometimes we are approached by physicians who want to be a part of a hospital system. >> I get that, you know, it's obviously they're just having trouble keeping their doors open. And so. >> and the overhead costs associated with maintaining electronic medical records, cybersecurity, security, dealing with the insurers. And they want to be associated with. >> the compliance costs alone are staggering. Let me be in my limited time.
▶ 1:43:55I want to turn back to doctor aziz and say we, uh, we were, uh, c o physicians are frequently, uh, they cite administrative burdens, prior authorization, uh, you know, as drivers of burnout and increased costs. From the ama's perspective, how much time and money are physicians spending on administrative tasks instead of patient care? >> so physicians are spending a huge amount of time dealing with administrative tasks.
▶ 1:44:25In my own practice, I have two people full time just dealing with prior authorization. So I always tell my patients now that when I write a prescription, I consider a recommendation because I don't know what's going to be filled because we have to go through a prior authorization process frequently to get basic, long standing generic drugs approved so that I can treat my patient's glaucoma or whatever the problem may be. >> it's actually it's absolutely frustrating.
▶ 1:44:52And, you know, I want to close with saying, I think that, uh, requiring prior authorization, whether on the part of an insurance company or whatever is, is the practice of medicine. And I would invite them into the medical liability arena, you and I have to pay medical insurance. So should they. With that, Mr. chairman, I yield back. >> the gentleman yields back.
▶ 1:45:17I now recognize the gentlelady from michigan, miss dingell, for her five minutes of questioning. >> thank you, Mr. chair, and thank you and ranking member degette for holding this important hearing. I know you keep hearing all of us say this, but on our side. But here it is a fact that the big. I will not call it beautiful. I can use a lot of other words, but I'll behave and call it ugly.
▶ 1:45:40Bill that was passed and signed into law last year enacted drastic medicaid cuts, jeopardizing access to essential care for millions, worsening health outcomes, increasing financial strain on providers, increasing the rates of disease, death, and uncompensated care. And then when we didn't extend the affordable care tax credits, more people got added to that.
▶ 1:46:06The providers in front of us all know that these cuts are impacting care for our most vulnerable communities, disabled people and older adults who rely on home and community based services, which are medicaid funded. Essential support for those groups. They help older adults and people with disabilities with day to day activities such as bathing, dressing, managing medication and participating in employment.
▶ 1:46:38And what's more important is it's cheaper, a lot cheaper than institution. It roughly saves $44,000 per patient. Medicaid also sustains the care workforce and supports family caregivers. Hbs programs provide the majority of funding for direct care workers, 37% of whom also rely on medicaid for their own health coverage.
▶ 1:47:063 in 10 childcare workers rely on medicaid for health coverage, and at least 13% of family caregivers whose unpaid care contributed more than $1 trillion to the economy depend on medicaid for coverage.
▶ 1:47:25Robust investment is essential to support those who rely on hcbs, their caregivers and their families, and cuts to this funding will put care even further out of reach than those that need it the most. So without this federal and debt investment, states are trying to fill the gap left by federal cuts, and they're cutting their budgets to make up for the decrease in the federal support. They're just can't do it. It's one of the first services that's being cut.
▶ 1:47:54So I'm going to ask, uh, miss merrill some questions here. Can you tell us about why we see positive economic outputs from communities that invest in hcbs and what it means to communities? When we have robust provider networks for community based services? >> I appreciate that question. Um, because, um, because the investment in hcbs is a major boost for state economies.
▶ 1:48:24Um, a study that was done just last year in missouri found that an investment of $1.6 billion from 2022 to 2024 contributed almost 6 billion. Your question was, how does that happen?
▶ 1:48:41And it happens because when people when you invest in hcbs and people have jobs and they are supporting people with disabilities and their families, they're buying groceries, they're buying cars, they're saving to hopefully buy a house someday. Um, you know, it's just a crucial part of the economy.
▶ 1:49:05Um, providers are businesses, providers are spending money, providers are buying groceries, providers are contributing to the economy in just a completely whole sail way. Um, the combined federal state spend for medicaid is $67 billion and that supports almost $170 billion in total. It's a significant impact. >> okay. I have two questions. You're going to have to go fast.
▶ 1:49:36Why is it problematic that community based services are considered optional under medicaid, which I don't think they should be because they save money. And what happens to people on the waiting list for hcbs benefits when states also make the decision to restrict access or not to pay for it? >> well, let me just start by thanking you for your leadership, your championship in, uh, in sponsoring. >> I don't want to be thanked, I want results. What happened?
▶ 1:50:03>> well, yes, but but your bill, um, the hcbs access, uh, act would make, uh, hcbs mandatory. That would make an enormous difference. So thank you for that because, um, because we wouldn't have 552,000 people on waiting lists across this country. >> and would it save money? >> we, we save money because people aren't going into large, expensive institutions. People aren't winding up in emergency rooms where the emergency rooms can't discharge them because they can't find a placement.
▶ 1:50:36>> thank you, Mr. chairman. I have more for the record, and I yield back. >> yes, ma'am, I appreciate that. And the gentlelady yields back. And I recognize the gentleman from georgia, Mr. carter, for his five minutes of questioning. >> thank you, Mr. chairman, and thank all of you for being here. I want to preface my remarks by saying I'm going to talk about the 340 b program, because I've got legislation that addresses what I think is a big, big problem and is going to evolve into an even bigger problem. But I do want to preface it by saying I support the 340 b program.
▶ 1:51:04And I, I get very irritated when I hear some of these companies say, oh, he wants to do away with the 340 b program, that nothing could be further from the truth. What I want is for simply the 340 b program to be what it was intended to be for. That's exactly what we're working for. You know, we've made a lot of progress in congress on curbing waste, fraud and abuse. And but we've got other problems. And one of them is the 340 b program. That's why I've introduced the 340 b access act.
▶ 1:51:34And the intent of this legislation is to improve the program's long term sustainability so that it can benefit those that was intended to benefit the fqhcs, the rural hospitals. That's who it was intended for and ensuring the patient benefits for that. But today, that's far from the case. The 340 b program grows more than 20% every year, more than 20% every year. 340 b is hospitals claim.
▶ 1:52:02340 b discounts on any patient they have contact with, as long as they pick up their prescription from a pharmacy that has a contract with the hospital. You know how many 340 b contract pharmacies we have in the orlando, florida area? 5000. 5000 in orlando alone. The 340 b hospitals are looking to capitalize on the nation's top tourist hub. That's what's worse is that the program's increasing cost for the group is.
▶ 1:52:30It was meant to help that that. And that's what I'm trying to get at the increasing cost to the group that it was intended to help patients, on average, pay more for drugs at 340 b hospitals, while those same hospitals have failed to reinvest in staffing or charity care. Mr. pollack, I want to start with you. What can we why can we not come together and align on a clear on at least a clear patient definition to reduce the cost of the program and ensure that the patients benefit?
▶ 1:53:00>> well, you know, the patients benefit in so many different ways from the 340 b program. A lot of those funds are used not only to provide discounts to patients, but also for home health, behavioral health, where it doesn't exist in those communities, substance and addiction programs. There are a lot of things that benefit the. >> all right. Well, can you tell me why you're opposed to this reform then I'm offering here? >> well, we're we're willing to talk to you about it for sure.
▶ 1:53:27>> but you know what the problem, what I what I struggle with is I get it. I know that the hospital and and I use hospitals in a general sense. Okay? I know that the hospitals have become dependent on this. If we were to yank the rug underneath, it would be catastrophic. I get it, but the problem I have with this is that this is masking the cost of other things that I can't see. And if I can't see them, I can't help you with them.
▶ 1:53:52If you're masking the cost because of the profits that you're making on the 340 b of other areas, then I can't help you. I want to help you. I know you're losing in other areas. So so stop masking the cost of those areas with the 340 b and let me see if I can help you. Perhaps there are rules and regulations that we can we can alter that would help you in those other areas.
▶ 1:54:17>> we would be very willing to talk about how we can increase the transparency of how the program is used and how the funds are being distributed, because you make a very important point, and we appreciate your recognition of the importance of the program. Um, but this program does serve as a, is a cross subsidy for the fact that we are grossly underpaid for a lot of other government programs. >> okay. I'm not questioning that. And I, and I believe you, but if I can't see it, I can't help you.
▶ 1:54:47And this is the problem that I'm trying to explain to you. And that's what we're trying to do. The 340 b program was intended for the federally qualified health care centers. It was intended for rural hospitals. Yet the the urban hospitals and the the large corporations have become so dependent on it. And I get it that that we we're having trouble now. Okay. And it's increasing cost for everyone. Well, let me. >> let me all due respect, it also helps a lot of very inner city urban hospitals.
▶ 1:55:15>> I get it, I get it, but we've got to contain the cost. If it's growing at 20% every year, it's, it's it's unsustainable. We all understand that. If you want to see time fly, try to get five minutes up here. You'll see time fly. Okay. I I'm down to 17 minutes. I'm sorry. Um, I'm going to have to submit these questions for the record because I'm out of time. But look, I'm very passionate about this.
▶ 1:55:41I hope that you'll look at the 340 b access act and damn it, don't be telling people I'm opposed to it. And I want to end the 340 b program. That's not true. I want to make it better. Better for those that was intended for. Mr. chairman, I yield back. >> gentleman yields back. I recognize the gentlelady from california, miss barragan. >> uh. Thank you. Uh, miss, uh, miss merrill, do you know, um, how how much money, how much money was cut in hr one?
▶ 1:56:08How much a medicaid cuts resulted from that? Is it like 900 billion? >> my understanding is the total the total cut to provider taxes, state directed payments, etc. Totaled up to $1 trillion. >> $1 trillion. Yeah. The number I have is about 900 billion. So, uh, rounding up, you know, my the chairman of this committee earlier said, let's see what the state's priorities are.
▶ 1:56:36But we've seen what president trump and republicans priorities are. They've shown us that they're willing to cut almost $1 trillion in medicaid cuts. They couldn't find the money to keep that, yet. They could find money to get involved in another forever war overseas, which is costing us an estimated $1 billion a day.
▶ 1:56:59And so it's a little rich to to have this hearing and have nobody mention the cost of war versus the cost of, um, also what it's costing, um, the american people and health care in the medicaid cuts that you brought up a number that I had not heard before.
▶ 1:57:20And I don't know if you could see this, but you said $70,000 to keep a person in in-home care versus $395,000. That's a huge difference. That's a pretty big savings. And I don't understand why when we get data like this, we don't have congress making sure we're investing in programs like this to save money.
▶ 1:57:46And so it's really, um, it's really frustrating to see that the medicaid cuts are going to result in more people being on waitlists and less people getting access to care. My mother is in that program and she had to wait six months for to get to get into it. And we've seen the big difference. Um, Mr.
▶ 1:58:03Pollack, I want to ask you, in 2021, sutter health, the largest hospital system in northern california, settled a lawsuit for $575 million that alleged the hospital system used its market dominance to stifle competition and to drive up costs. Just yesterday, sutter announced an acquisition that will create a 39 hospital system, including across california, minnesota and wisconsin.
▶ 1:58:28Should there be concerns that this california health nonprofit that was already large is doing this massive acquisition just five years after they settled a lawsuit over anti-competition practices? >> yeah, I don't know the I don't know the details of the lawsuit that they settled, but this goes to the whole issue of systems and consolidation. And in this case, it's consolidation that is in two different geographic areas of the country.
▶ 1:58:54And I would point out that when we come together as systems, we are often providing a lifeline to rural hospitals that are in great jeopardy. >> so you don't see this as a concern at all? >> um, no, I think that there's great. >> okay. That's that's that's good. I just want, I need to make sure I go to other folks. Miss mitchell, I want to talk to you.
▶ 1:59:16In your testimony, you highlight yet another case against sutter health in which sutter withheld access to maternity care unless employers contracted with their entire system. Uh, sutter settled out of court, but returned over 500 million to employers and unions, which you. Um, say suggests significant overcharging by sutter. From the employer's perspective, how can hospital consolidation allow this type of overcharging? >> thank you.
▶ 1:59:42And we were actually catalysts in bringing the suit that you referred to, uh, where anti-competitive practices like anti tiering anti-steering actually drove up costs. The example that I cited was to access some of the maternity services. Employers were required to buy the entire system, even if they didn't have employees in those areas.
▶ 2:00:03So it is highly problematic for these hospital systems to, uh, first of all, consolidate and then participate in these anti-competitive contracting approaches. We are very concerned about this latest expansion.
▶ 2:00:17Uh, we believe that that will, um, likely contribute to additional cost increases and all of the data, all of the evidence shows that consolidation drives up prices between 3 and 60% with absolutely no benefit to quality or access. So I think it's very important to address consolidation as an affordability crisis. >> great. Thank you doctor.
▶ 2:00:39Um isis, I um, if consolidation raises the price of care because it creates less competition, what steps, um should congress take to prevent consolidation? >> well, I think the most important thing congress can do to prevent consolidation is ensure that we have adequate medicare reimbursement to independent physician practices that will allow them to stay open.
▶ 2:01:03Um, as you know, the medicare fee schedule impacts not only medicaid, but also, um, private insurance reimbursements. So in an era where physicians are struggling to keep their offices open because of financial pressures, updating the medicare fee schedule consistent with with the inflationary update on an annual basis, which all the other providers receive, would be of tremendous benefit and ensuring less consolidation. >> thank you. I yield back. >> gentlelady yields back.
▶ 2:01:31Now recognize the gentleman from pennsylvania, doctor joyce for his five minutes of questioning. >> thank you for. >> yielding. >> Mr. chairman. >> according to cms. >> data from 2024 on total health care expenditures. >> spending has. >> reached a new high of over $5 trillion. Notably in this report, hospital costs, which now make up for 30% of that 5 trillion, are the steepest rising costs being paid for by the american patient. Today.
▶ 2:02:00There are several forces at work that drive these costs higher. One of the biggest is, as many of you have mentioned, hospital consolidation in response to the consolidation in health care medical markets, rfi hhs issued a report concluding that consolidation of health care providers has led to higher prices, reduced access and lower quality of care because of the differences in medicare fee schedules, hospital reimbursements has gone up, while the
▶ 2:02:31Reimbursement for independent physicians and providers has gone down when adjusting for inflation by 33% since 2001, and patients continue to pay that price again each and every day. When a hospital acquires a physician practice, patients are exposed to higher co-pays. They're exposed to prices that are increased for the exact same services, simply because the ownership and the name on the door has changed.
▶ 2:02:59But there are other hidden charges that will occur as well. Mr. martin, do large hospital systems implement restrictions on their employee physicians and their physicians regarding their referral patterns? Does that affect the bottom line? >> um, thank you for that question. Um, it is our understanding that, yes, many health systems will impose either direct or indirect, um, requirements on, on their employees.
▶ 2:03:28>> do you think that affects the bottom line? >> I think it does affect the bottom line. >> doctor digiorgio, have you seen instances where this occurs as well as when a doctor is reprimanded for a referral for an out of network referral, and even if it is in the best interest of patient care.
▶ 2:03:46>> yeah, I have plenty of colleagues who work for for large health systems and have, uh, have told me that they have faced this, uh, where they, it may be things like losing a parking space or not getting a bonus if they allow, uh, what is commonly referred to as leakage outside the system, there's even that that term is used for it. If, if, uh, physicians in the system let referrals go outside of the health care system. >> as doctor to doctor, I don't like that term leakage. I think that doctors have a responsibility to provide the best care for their patients.
▶ 2:04:17And I think that should be unencumbered by where that patient is referred. I agree, doctor aziz and Mr. martin, this is a yes or no. Is increasing the medicare physician fee schedule by tying it to the rate of medical inflation, a necessary first step to stop consolidation, doctor aziz. >> yes. >> Mr. martin. >> yes. >> with my remaining time this left, I'm going to return to you, doctor digiorgio.
▶ 2:04:44Beyond an initial down payment for the medicare physician fee schedule reforms, must we in congress work to lower costs and increase competition? I have long advocated for the repeal on the ban of physician owned hospitals, but can you explain how that and other steps are necessary in a minute and a half? >> I can give it a shot.
▶ 2:05:07So the physician owned hospitals work because the same physician who sees the patient every day is also the one making operational decisions. So physician owned hospitals have a tremendous record of providing high quality care at lower costs than non-physician owned hospitals. I have a colleague who owns a spine hospital that runs it with about one third of the amount of staff that a similarly sized, non-physician owned hospital runs. >> is the quality of care the same? >> no. It's better. Um, and his patients prefer that hospital.
▶ 2:05:39They have a net promoter score of 93 or similar sized hospitals have a net promoter score in the mid-teens. So the patients prefer these hospitals. These hospitals provide wonderful care because again, the physician who sees the patient is the one making the operational decisions. Personally, when I go in in the middle of the night to do a decompressive craniectomy 2 a.m. There's no administrator that knows how to do that surgery. There's no administrator that knows what is needed to make that happen efficiently and putting the patient first. Only the physicians have that knowledge.
▶ 2:06:08So physician owned hospitals align the interests and the incentives in the patient's best interest. >> are you aware of where and who owned the first physician owned hospital in the united states? >> I was not expecting to get pimped on that today. So no, I don't. >> I wouldn't use that verb. Is anyone aware of that, doctor aziz, do you know where the first physician owned hospital was in the united states? >> I don't. >> know, it was it was owned by benjamin rush, a physician who signed the declaration of independence.
▶ 2:06:34It is owned and was owned by a physician in the in the city of philadelphia, pennsylvania. It is a precedent that should be maintained. With that, Mr. chairman, I yield the remainder of my time. >> gentleman yields back. We could go into a long lecture on doctor rush, who also was a big. About being in person to cast his vote on the declaration. >> I would welcome that on another hearing. >> another time, and I recognize the gentleman from texas, Mr. veasey, first five minutes of questioning. Mr. chairman, thank.
▶ 2:07:05>> you very much. Um. >> as my colleagues have made clear, uh, we will all feel the impacts of republicans still in $1 trillion out of the american health care system. Uh, but on the topic of provider landscape in this country, I want to be very clear about how these cuts are going to devastate the physician workforce, which is already in crisis. Uh, doctor, uh, asus, uh, would you agree that the united states is currently facing a physician shortage? Uh, and what does that mean?
▶ 2:07:36>> so we definitely are facing a physician shortage. As I mentioned in my opening comments, uh, we're expecting a shortage of 86,000 within ten years. And we are facing that shortage. And what it means right now is it makes it much more difficult for patients who need care to get appointments. Simple as that. Um, when my spouse needed to be evaluated by a neurologist, it was a six month wait. And, uh, and that's being well connected in the community. So if that's happening to me, it's happening to my patients as well. Yeah. >> yeah, absolutely. Yeah.
▶ 2:08:07People already have to wait a lot longer, travel further, pay more for care if they can get it at all. And instead of fixing the problem, last year's big ugly bill made it worse and very two specific ways. First, it makes it harder to become a doctor. Today, the average cost of one year of medical school in the us is about $60,000. On the high end, it will cost you well over $100,000 per year per year.
▶ 2:08:33Um, when all is said and done, going to medical school can set you back a half $1 million. Um, but the bigger bill capped the amount that a medical student can borrow from the federal government at about $50,000 a year. Uh, does that math sound about right to you? And the reason why I'm asking is that we are asking kids across this country from low and middle class backgrounds, who dream of becoming a doctor one day. That's something that any school, public or private, become a doctor. It's like a big deal.
▶ 2:09:03But we're telling kids who dream of becoming a doctor one day to come up with at least $40,000 or turn to predatory loans if they want to help their community. I think that's devastating. Uh, doctor seuss will a $50,000 annual cap on federal student loans severely limit who will be able to go to medical school or worsen the physician shortage?
▶ 2:09:30>> I think it's the belief of the american medical association that a cap like that will limit opportunities for individuals to attend medical school. It will impact, uh, the very the variety of individuals who might choose to become physicians, which will impact the care that we render in our own communities. >> yeah. Yeah, absolutely. Thank you. Now, the big ugly bill doesn't stop at making medical school more affordable. It also makes it harder for physicians to stay in practice.
▶ 2:09:57And as a reminder, my republican colleagues ripped about $880 million out of medicaid. And states do not have a magic pot of money or rainy day funds to replace trillions of dollars. Instead, states are now being forced to make very hard decisions, and that will include reducing the amount they pay providers. Mr. martin, on average, what does medicaid pay physicians compare to medicare or private insurance? >> um, thank you for that question.
▶ 2:10:25In medicaid, for primary care, it's about 60%, uh, in medicaid versus medicare. And commercial rates are one and a half to two times that. >> yeah. So it sounds like medicaid pays about 20 to $0.30 per dollar, uh, that a private insurance pays physicians. And that's already a very huge disparity. Uh, now states will have to pay physicians even less. So, Mr. martin, how would you even lower medicaid reimbursement rates?
▶ 2:10:52Um, uh, how, how would, uh, even lower medicaid reimbursement rates worsen america's physician shortage? >> well, in primary care, it's a great concern because primary care tends to have, um, a higher medicaid panel than many other physician specialties in their community. So lower, uh, payment rates, um, lower coverage rates, separating people from coverage in the medicaid program is going to create issues for, for family physicians in many communities.
▶ 2:11:23And, and, you know, quite honestly, it's going to result in less prevention care, less vaccination, less cancer screenings, and ultimately more upstream cost us patients have disease progression and go to higher costs care sites. >> yeah. No, thank you very much. And as you as you can see, this, uh, physician shortage crisis is only going to get worse under these republican policies. Uh, it worries me. You know, we think about, you know, tech workers and the shortage that we've had in that space. We think about ag workers.
▶ 2:11:51We may have to start looking for some way how we're going to, uh, do more, um, visas to bring more doctors over because capping rates and these medicaid reimbursement rates, they're not going to help us recruit or maintain more doctors in our system. Thank you, Mr. chairman. >> gentleman yields back. And I recognize the gentlelady from iowa, doctor miller-meeks. >> uh, thank you, Mr. chairman. And I want to thank our witnesses for testifying before the subcommittee today.
▶ 2:12:18Today's hearing is critically important because every policy discussion or real patients, employers trying to provide health insurance, families trying to afford care, seniors managing chronic conditions, and providers working to keep their doors open, and increasingly complex systems. Over the past decade or so, we've seen significant consolidation across the health care system, especially after the passage of the affordable care act and particularly among hospitals and large health systems.
▶ 2:12:47At the same time, medicare physician reimbursement has declined by over 30% in inflation adjusted dollars since 2001. If we continue on the current path, we're not just cutting payments, we are cutting access. In rural iowa. We don't have an excess of providers. When one closes, patients have to drive hours for care. A 2 to 3% cut in washington can mean the difference between staying open and shutting down in a small town.
▶ 2:13:16Doctor azouz, as both a board certified ophthalmologist who practiced outside of large health systems and in rural areas, we've experienced how many small, rural and independent practices struggle to participate in value based care models. Can you tell me? Are their payment models that would be more accessible without disadvantaging independent providers, who are often the ones in small towns?
▶ 2:13:44>> so as a fellow ophthalmologist, I can tell you that we don't really understand what value based care models are for ophthalmology. Unfortunately, there are not a lot of opportunities for ophthalmologists to participate in a value based care model. Um, in a, in reality, as you know, um, ophthalmology in particular is episodic care. People come in annually for an examination if they have a more significant disease, such as glaucoma or diabetic eye disease, we may see them every three to 4 to 6 months.
▶ 2:14:14>> let me ask that. You mentioned episodic care. Um, are there procedures that could and once were done in a physician's office that would be less costly to the patient and to the health care system overall that are now done in hospital outpatient departments? >> well, absolutely.
▶ 2:14:30I mean, as we see consolidation taking place and physician practices being acquired or physicians working for the hospitals, if you go in for an eye examination at a large system in my area, the cost is double what it costs when you come into my own office. >> Mrs.
▶ 2:14:46Mitchell, can you speak to the impact of hospitals acquiring physician practices and entering into employment arrangements that may exceed fair market value or be commercially unreasonable, and how congress should address these practices to protect affordability and competition. >> yes, our members want to pay more for independent physicians because we know that it leads to better referrals based on quality, it leads to lower costs and the distortion of pricing in hospitals is highly problematic.
▶ 2:15:16When you look at site neutral payments, we could save billions of dollars by just charging the same price from a hospital and facility to a non-hospital facility. I mean, a band-aid is a band-aid, a ct scan is a ct scan, and yet they are up charging because they can. We would like to have those fair prices. >> thank you, doctor de giorgio. My apologies.
▶ 2:15:40You and I both strongly agree that section 6001 of the affordable care act and stark law create an untenable double standard. As you say. Why should independent doctors be subjected to prohibitions on self-referrals when corporations aren't. How have these policies changed provider behavior to incentivize vertical consolidation and higher costs? >> the compliance burden alone for for stark law is immense. I have a colleague who's a spine surgeon. He just wanted to purchase his own mri machine.
▶ 2:16:10He hired three lawyers and got five different opinions on whether or not he was violating stark law. So just the compliance costs on stark are immense. And then, of course, with the site of service differential, by banning physicians from owning hospitals, we cannot participate in those facility fees. We are we are shut off from the facility fees, even ambulatory surgery centers, which are almost identical to hospitals, charge significantly less and do not get the hospital outpatient department facility fees.
▶ 2:16:35Many neurosurgical procedures can be done in ascs much cheaper than in hospitals, but we are not allowed to participate in owning those hospitals. >> thank you. And Mr. pollack, the declining fee schedule, conversion factor and rising hospital base rates are not an accident, but a result of policy choices made by congress in macra of 2015. For the record, I'm I'm going to submit these questions for the record to have you answer them. The primary base hospital rate payment for inpatient services has increased by 30% since 2016.
▶ 2:17:07The outpatient service base rate has increased by 26% since 2016. Meanwhile, the physician based payment rate has declined. Over the same time. Shouldn't we have medicare economic index and inflation adjustment for for physicians, it's high time that we do to to ensure we have access. With that, Mr. chair, I yield back. >> gentlelady yields back, and I recognize the gentleman from ohio, Mr. landsman, for his five minutes of questioning. >> I thank you, Mr. chair, and the ranking member for the hearing and for all of you for being here. We appreciate it.
▶ 2:17:38Um, I want to focus on the health care crisis, uh, and get the thoughts of, of a couple, uh, you, um, Mr. pollack, you represent hospitals, uh, Mr. martin, family physician. So I'm going to ask both of you, uh, some questions to get at, um, if you believe we're in the middle of a health care crisis. And if so, what is at the heart of it?
▶ 2:18:05If you had to pick 1 or 2 things, this isn't a gotcha question. I'm legitimately curious as, as, as, as folks who are representing providers, what is would you describe this as a health care crisis that we're in? Yes or no. And then what is driving that 1 or 2 things, Mr. pollack. First, sorry, mike. >> that's an easy question to say. Yes on a yes or no question.
▶ 2:18:33Um, between government underpayment, rising number of uninsured access problems for behavioral health, workforce shortages, uh, supply chains that are broken and our investments that we need to do in cybersecurity, there are multiple dimensions to the issue. So your question as to how do we get at some of this, this hearing is about affordability.
▶ 2:18:53And we are supportive of looking at new arrangements to better coordinate care, different versions of value based payment is the right direction to go in when you consider that, uh, 1% of. >> Mr. pollack, I hate to interrupt. That was super helpful. I just want to I want to get Mr. martin and then I'll. >> come back number. >> for you. Yeah. Okay. Oh, sorry. Finish. >> 1% of the people concerned, 21% of the spend. Yeah. 5% over half.
▶ 2:19:20If we can focus on those people that are really sick with chronic conditions, we can make progress. >> glad you said that. Thank you, Mr. martin. >> I will be brief. Yes, we are in a health care crisis. It is first driven by the fact that we were becoming more unhealthy as a population. We have separated people from primary care, the opportunity to pursue health that results in higher cost care at higher cost settings.
▶ 2:19:40Um, number two, we have layered payment policies on top of each other that have accelerated consolidation in ways that I think were unpredicted, but they are severely damaging. >> I agree. Um, I appreciate the answers and, and agree based on my conversations with hospitals and physicians and folks close to the ground that, uh, it is, it is a combination of several things. You mentioned Mr. pollack, a couple and Mr. martin, you, I think reiterated some of those.
▶ 2:20:10One being there is the underpayment issues which we could address. I mean, we could immediately as as the united states congress increase at least the medicare medicaid reimbursement rates, uh, the, the way in which we pay physicians, we could do that immediately. And I would support that. I think that would make a huge difference. We also you also talk about the coverage issue, and that is part of the issue with more and more people being unhealthy.
▶ 2:20:38If they don't have coverage, they're likely they're like more likely to be unhealthy. Um, the aca subsidies, it, it did not help the fact that this congress did not extend the aca subsidies made it harder for you. All correct. Or maybe let me ask in a less leading way, Mr. martin, what's the impact you're seeing?
▶ 2:21:00>> well, I would go back to my opening statement separating people either procedurally or financially from an opportunity to seek and receive health care, particularly primary care, will result in them being less healthy for a variety of reasons and will result in upstream costs. So, um, the credits or whether it be medicaid eligibility, those procedural and financial barriers have health consequences. >> thank you, Mr. pollack. >> well, according to cbo, 4.5 million, 4.2 million people will lose insurance as a result.
▶ 2:21:31>> it's a staggering number. Can I get a minute left on the medicaid cuts? Because you take $1 trillion out of the system, which is what we're seeing with the medicaid cuts, $1 trillion in medicaid cuts. Mr. pollack, what are the hospitals? How are they reacting? >> they're putting together scenarios to determine how best to adjust to that, with the hope that perhaps we can get some of that reconsidered. >> what is it just mean.
▶ 2:21:58>> adjust means how do you maintain the highest quality service in the services you can provide? >> will they cut? What services. >> do you simply have to not provide or rely on other parts of the system to do it? That's where systems come in. By the way. >> Mr. martin. >> um, labor and delivery units are enclosed. Prenatal and postpartum care is going to decline. Vulnerable populations and vulnerable geographies are going to have harder time accessing care.
▶ 2:22:25Primary care is going to become less available and less affordable for those individuals. >> so by the way, that is a nightmare situation. I mean, what you just painted is a nightmare, uh, scenario. Um, unfortunately, that's all my time. Thank you. And I yield back. >> gentleman yields back. Now recognize the gentlelady from florida, Ms. kat cammack for her five minutes of questioning. >> all right. >> thank.
▶ 2:22:50The real purpose in her post is to make sure you don't have to see the ugly face of the chairman. I'm just saying. >> thank you for your graciousness, Mr. chairman. And thank you to our witnesses for appearing before us today. Uh, you know, throughout this affordability series, we have examined the drivers of what patients ultimately pay. And today's focus on the provider landscape is really a cornerstone of the discussion.
▶ 2:23:19So I'm excited to be having it today. But as we all know, families across the country are paying more for health care. Whether it is higher out of pocket costs, higher premiums, and ultimately, they're seeing fewer and fewer choices of where they can receive care and when they can receive care. Now, a major trend that we're seeing is consolidation across hospitals and physician practices. And we're hearing that integration improves coordination and expands access. But for so many patients and so many of my constituents, they're seeing the opposite. It's not what that feels like.
▶ 2:23:49It feels like they're getting worse outcomes. As consolidation increases in market after market consolidation is followed by fewer independent providers, less competition and fewer real options. And in some cases, patients are paying more for the exact same service simply because of where it is delivered. Now, congress has taken steps to improve transparency, but transparency alone does not and does not create competition in highly consolidated markets. It can just as easily become a tool to raise prices as lower them.
▶ 2:24:19Now, at the end of the day, patients don't really care which part of the system is responsible. They just know that they're paying more, getting fewer choices, and that the system continues to be broke. Now, as we hear from witnesses, I think it's important that we separate theory from reality and we focus on what patients are actually experiencing. So I'm going to start with you, Mr. pollack.
▶ 2:24:42In our last hearing, we heard that vertical and horizontal integration improves care coordination and expands access. But in market after market, as I just said, consolidation is immediately followed by higher pricing and fewer independent providers. So I'm going to ask you directly, how is consolidation supposed to lower prices for patients when the evidence consistently shows that prices go up after hospitals merge or acquire physician practices?
▶ 2:25:09>> you know, I know some people may say that, but for the research that we've done, we've actually seen operating costs reduced as a result of systems coming together by -3.3%. And we've actually seen revenue decrease per adjusted admission. Now, the issue, congresswoman, is that doesn't always get passed on to the patient. That's the problem because there's an insurer in between that sets the rates. We've also seen, by the way, quality improve.
▶ 2:25:36According to articles in the journal of american medicine, where we have seen a reduction in readmissions and a reduction in mortality measures as a result of systems coming together. And again, as I said earlier, systems are a lifeline for hospitals that may not survive on their own, especially in rural areas. >> I think. >> the data points to a completely opposite scenario than what you just painted. But I'm going to direct to doctor. Do I have to do it with the italian hand gesture? >> that does help. Yes, absolutely.
▶ 2:26:06>> did you how do you say it, giorgio? What you said. Would you like to respond to that? >> yeah. There's some studies that show that, um, the volume of services and the intensity of services do go up with acquisition of private physician practices. I believe the latest number I read was about 14% increase in medicare spending alone with acquisition of independent practices. And your chart there, it should be pointed out that while hospitals are 31% of that spending, about 75% of the physician and clinic spending is actually owned by the hospital.
▶ 2:26:35And a significant amount of the retail prescription drug spending is also going to the hospital, largely through their 340 b program. So hospitals actually take up a lot more of that chart than is let on. >> we were trying to be nice with the chart, but I think that that is very important for folks back home watching what you just said to get clarity in this. Now I know my time is running out, so I'm going to I'm going to jump to, um, you miss mitchell employer supported price transparency so patients and purchasers could compare prices and make informed decisions.
▶ 2:27:04But in highly consolidated markets where 1 or 2 systems dominate, have you seen cases where transparency simply allows dominant systems to see competitors pricing and adjust their prices upward? >> we are concerned about that. We think transparency is absolutely necessary but insufficient. It takes the, uh, large purchasers to actually use that information to negotiate better rates. That is extremely challenging in consolidated regions.
▶ 2:27:30I will also say all of the evidence we have shows that consolidation only drives up prices without any corresponding improvement in care. And and it's interesting that they say that operating costs go down, because that just means that there may be more savings at the hospital, but that is certainly not being passed on to anyone paying a bill. >> yeah.
▶ 2:27:51So just to put a button on it with the last 10s that I have, as consolidation increases, access goes down, prices that the consumer pays go up. And even though they say that they're saving money in their system, that's really going towards their profits. And so I think in the end, it's just a broken system that continues to perpetuate. Correct. >> I would agree, and if they are generating savings, they should come to patients. And purchasers. >> 100% agree with that I yield back.
▶ 2:28:23>> the gentlelady yields back and now recognize the gentleman of louisiana, Mr. carter, for his five minutes of questioning. >> thank you, Mr. chairman and ranking member for holding this hearing. And thank you to all of our witnesses for joining us here today. Under the failed leadership of secretary kennedy and the trump administration, we've seen some of the largest cuts to medicaid in history. Aca premiums have skyrocketed for families and small business owners.
▶ 2:28:50The dangerous misinformation and vaccine on vaccines have grown rapidly. As a father of two sons, I empathize with the healthcare providers navigating this difficult landscape of misinformation and the parents, especially first time parents looking for evidence based guidelines and recommendations to protect their children from preventable diseases and to keep them safe and healthy.
▶ 2:29:19Doctor azouz, given monday's court decision to halt secretary kennedy's and the acip's damaging childhood vaccine schedule changes, parents and providers alike will be relying on trusted medical societies like the american medical association and the american academy academy of pediatrics to provide them with reliable information.
▶ 2:29:43How will the recently announced collaboration between ama and vaccine integrity projects help prevent parents rather help parents make informed, evidence based decisions? And how will it help clinicians communicate the safety and efficacy of vaccines? >> thank you for that question.
▶ 2:30:09As you know, you know, physicians need evidence based vaccine guidelines that they can trust and that they can use to confidently advise our patients. And that's why the ama is working with the vaccine integrity project. So we will be able to restore a transparent, evidence based process for vaccine recommendations. In particular, we will be doing a review, a structured review to assess vaccine safety and effectiveness for the upcoming 2026 to 27 respiratory virus flu season and others.
▶ 2:30:38And, um, we'll be convening other medical organizations as well as public health and healthcare organizations to develop a comprehensive set of guidelines for vaccine use. You know, I recently encountered one of my own patients who has a newborn and was telling me that she was afraid to go to her mommy and me classes because she was uncertain whether the other children in the mommy me class would be vaccinated. >> and along that line, I don't want to cut you off a little bit of time.
▶ 2:31:06Is it safe to assume that the public has lost confidence in cdc and hhs in these policies? >> I think it's clear that the public needs an independent organization like the ama. >> and would you also agree that having the collaboration between the organizations that I've mentioned, as you mentioned, are critical to restore that confidence? >> yes. >> I'd like to enter to the record. Um, Mr.
▶ 2:31:32Chair, three articles by unanimous consent that speak to these issues the new york times, the new york times, and talking points about vaccines. Pediatricians navigate the sea of misinformation. Cnn hospitals fighting measles confront a challenge. Few factors have seen it before. A few doctors have seen it before, and the washington post judge halts rfk jr's vaccine overhaul, citing a flawed process.
▶ 2:32:01>> uh, what we'll do is take a look at those real quick and then probably do it at the end. But I don't see any objection. I assume they're all timely, always. >> very timely. >> okay, then I expect they will be, but we'll we'll have our team take a look at them if you can pass them to us. >> I trust your judgment, sir. >> thank you. There you go. Thank you. >> uh, doctor seuss, can you share the challenges your your members are facing with the current climate of vaccine misinformation and fear? >> well, I think, as I indicated, uh, patients are confused.
▶ 2:32:29So anything that will help allay that confusion is of benefit. So they need to trust their physicians and they need to trust that physicians will be using science and, uh, appropriate measures to advise them and ensure that they understand what vaccines are needed and when. >> is it not also true that we are still fighting new, uh, diseases, new needs for vaccines? We don't need to revisit those that we've conquered like measles. Isn't that correct? >> correct.
▶ 2:33:00>> how bad is the measles epidemic that we see in our country as a result of a removal or a, a, um, stepping away from the efficacy of vaccination vaccinations? >> well, as you know, we're having measles popping up all over the country. Most recently, we had nearly a thousand cases in south carolina. So the. >> is that is that directly attributed to the fact that people are moving away from vaccines?
▶ 2:33:28>> patients who don't get vaccinated are going to get the measles if they're exposed to it. Yes. >> and it's been proven to be effective. >> yes. >> I yield back. >> gentleman yields back. Now recognize the gentleman from oregon, Mr. benz for his five minutes question. >> thank you, Mr. chair and thank the panel for being here.
▶ 2:33:48I'm from oregon and I've traveled around my district, which is large, 70,000mi, and I've gone to, along with my staff, about 31 different hospitals and health care facilities. I asked them when I get there, because they're all concerned. They're all having difficulty with the cost of everything. What we could do to help drive down costs. And so the the prompt answer is always staffing. It's almost always nurses.
▶ 2:34:15And so my staff found a study by mckinsey and company 2023, where it says that we have a projected nursing shortage of between 200,000 and 450,000 nurses. So well, just start. Uh, I'm not sure who to start with. Uh, Mr. martin, is that does that sound right? Is this is this a surprise to you? >> it is not a surprise to me. There are healthcare shortages and physicians and nurses and med techs and lab techs.
▶ 2:34:42It's a well documented that there's a health care professional clinician shortage across the country. >> okay, so what do we do about it? What's the solution? Give me. We need between 200 and 450,000 nurses. What's the solution, by the way? Uh, members of my family are nurses. Uh, the members of my family are going to nursing school. It's a it's a long and necessary process.
▶ 2:35:07So are you talking about immigration or what are we talking about to solve this problem in the near future? >> I will be humble here and tell you I'm not an expert on the nursing shortage. I, I obviously the workplace environment, uh, compensation rates, um, quality of work and the importance of the work they do and, you know, drives professional satisfaction in all healthcare careers. >> let me just mention that the going rate for a nurse in oregon is 120,000. A traveling nurse, it's 220,000.
▶ 2:35:33So I'm not sure that that what people are being paid is the problem. It appears that we we don't have people that want to do it. Doctor digiorgio, what's your opinion? >> I think a lot of it comes from the consolidation. The same things that we see in the physician workforce are mirrored in our nursing colleagues. So number one issue is with consolidation and with a lot of the regulation, as we see a deep professionalization of the workforce, both on the physician and the nurse side.
▶ 2:36:00If you've been in a hospital, the nurse is no longer predominantly at the bedside. She's stuck to the computer. Right. And this is happening with our physicians as well, is that we are turning our professional workforce basically into data entry clerks because of the large amount of regulation. And then with consolidation, we see the same thing on the physician side, but there's a reduction in pay. There was one study that showed about a 7% reduction in nursing pay when large systems consolidate.
▶ 2:36:22So systems consolidate, they cut out the the pay because there's no longer now they're in a monopoly buyer of nurse labor information labor. And then they they need professionalize. >> is artificial intelligence going to be the solution? We hear about it all the time that, no, it's all solved. All this paperwork is going to melt away because of ai. Is that correct? >> I'm very hopeful about artificial intelligence. I was also I think people were hopeful about computers. The problem is we overregulated the electronic health records. So instead of them becoming helpful, they became an impediment to care.
▶ 2:36:51I hope we don't make those same mistakes with ai. >> and so what's who's who's taking care of this? Who's making sure those mistakes don't happen because of the truth of it is, it almost seems as though the shortage gives people an excuse to raise prices. Is that the truth? I agree, and we've heard that in other conversations with various various groups.
▶ 2:37:08And by the way, the the remarks about larger systems resulting in higher quality care at less cost, I have to I have to beg to differ, at least in previous conversations, it appeared that there was a focus on those those types of things, while ignoring the amount of money being made on the float by delaying care. And so I asked that question of united healthcare when they were here. It was, uh, discouraging to hear the, uh, how many billions of dollars are being made on the float, I must say.
▶ 2:37:36And that appears to be something we should be focusing upon, uh, with as long as I'm with you, doctor giorgio, in the minute I have left, you're a practicing nurse, neurosurgeon, and a big health care system. You've done a lot of academic research in the health care affordability. Where does the physician fit in this shortage space? And we heard earlier a focus on residencies.
▶ 2:37:57What can we do here in congress to spring, uh, loose this huge herd of doctors waiting behind the barrier, uh, of not having enough residency slots? >> well, the training pipeline is one area, and I think we should certainly support more training, but on the back end as well, if we empower physician ownership and independent physicians, we'll keep more physicians practicing longer. Right now, too many physicians are looking for the first exit out of clinical practice because we have diminished the practice of medicine so much, and we've reduced independent physician autonomy.
▶ 2:38:27>> and your solution there, you think we should ban the consolidation? What's your solution to the problem? You just. >> I think addressing a lot of the issues that are driving consolidation, such as the ban on physician owned hospitals, stark law, the site of service differential. 340 b certificate of need laws. All of those could help empower physicians to open their own independent practices and with that investment and buy in into their communities, practice for longer and help alleviate the workforce workforce shortages. >> thank you. Yield back. >> gentleman yields back.
▶ 2:38:56Now recognize gentlelady of texas miss fletcher for her five minutes of questioning. >> thank you, mister chairman. And thank you to our witnesses. Um, house republicans have once again brought us here to discuss health care affordability. Um, an important topic for people across the country and certainly at home in my district. But this hearing is really looking to shift the blame from this congress and this administration for the health care affordability crisis that we're experiencing.
▶ 2:39:24And certainly there are a lot of important drivers. But as many of my colleagues have already said today, we cannot have any discussion about healthcare affordability without acknowledging that over the last year, this congress has voted time and again, and it is republicans in this congress who have cast vote after vote to increase health care costs in the so-called one big, beautiful bill that cut medicaid.
▶ 2:39:51And in turn, because the cuts were so big, cut medicare too. And by failing to extend the affordable care act's enhanced premium tax credits, uh, for an administration that says it wants to make america healthy again, its actions demonstrate the opposite. And my home state of texas already has the highest uninsured rate in the country.
▶ 2:40:13And because of this, congress's actions over the last year, at the urging of the trump administration, that number is estimated to go up, not down. Now, I have the privilege of representing so many people who work at the texas medical center, the largest medical complex in the world. And I also get to work with incredible people in our community who are working at federally qualified health clinics and other locations, providing incredible care.
▶ 2:40:40And I'm so grateful to hear from all of them frequently about the many issues that they face in trying to care for their patients, including the strain that increased uninsured rates will add to the whole health care system. I mean, it's really an ecosystem. And so when we talk about cuts here and changes there, it affects everything else.
▶ 2:41:00And we know that these changes to the health care system and these increased burdens are forcing hospitals and providers to cut services and reduce staff. And we're only a few months into 2026, we've already started to see drastic losses. The bureau of labor statistics reported in february, 28,000 people lost their health care jobs nationwide, including some in my district.
▶ 2:41:25So we've covered a lot of issues here today, but there are other things happening in our hospitals that are also impacting access to care and to the health of our communities that we in congress cannot continue to ignore. In fact, they arise not from the main topics that we have covered today, but from other policy decisions in washington, including the trump administration's immigration policies. We just heard about the nursing shortage.
▶ 2:41:52President trump instituted a new $100,000 fee for h-1b visas, which are the visas that many health care workers rely on. This policy is going to make it harder, not easier, to get a robust health care workforce. But I want to focus with the time that I have left on another.
▶ 2:42:12The trump administration has ended a long standing policy that prevented immigration enforcement actions in sensitive areas, including hospitals. And since this new rule has been implemented, healthcare professionals have reported an influx of immigration enforcement agents in hospitals and that the presence of this these agents roaming the hospitals has left many people scared to go there.
▶ 2:42:43And recently, federal health officials agreed to give immigration enforcement officials access to a medicaid database that includes enrollees, addresses and citizenship status. And despite a court challenge, the courts are allowing this policy to move forward. And that is creating fear in our immigrant communities and in cities like mine, where 1 in 4 people was born in a foreign country, in districts like mine, where that number is 1 in 3, this has a huge impact on people's ability to access healthcare.
▶ 2:43:11And this includes legal immigrants who are getting swept up in this mess of immigration enforcement that this administration is pursuing. And so I'm stating the obvious here. But if people are too afraid to go to the hospital because of immigration policies like these, they will not go or they will delay going until they absolutely have to when their conditions are worse and in sometimes when it's too late.
▶ 2:43:37And so, you know, we saw that during the covid 19 pandemic, we saw the disastrous impacts when patients did not delay access to care. And so I trust that all of you would agree that delayed care often results in increased costs of care as well. And I want to ask questions, but I've only got seven seconds left, so I'm going to ask them for the record.
▶ 2:44:00But what I want to know is from each of you hearing about what happens when a when a patient is forced to delay care for themselves and what are the impacts on the overall health in our communities when we're delaying access to care for patients? Mr. chairman, thank you for letting me go a minute a second over my time, and I yield back. >> gentlelady yields back. Now recognize the gentleman from ohio, Mr. rowley, for his five minutes of questioning. >> uh.
▶ 2:44:36>> how are we doing now? >> thank you, Mr. chairman. This question goes to miss mitchell. Uh, the department of justice is suing ohio health over anti-competitive practices, alleging their use of all or nothing contracts or leveraging their market power to force plan sponsors to include all ohio health hospitals in the network at the expense of affordability. This led to ohioans paying more for benefits with no increase in quality of care. So my question is almost a two part question.
▶ 2:45:07Miss mitchell, is there something that your members are seeing today, uh, that is impacted by this ohio health maneuver? Should employees pay more because a hospital system has a monopoly on power, or is there alternative paths that we could choose?
▶ 2:45:24>> well, I can't speak to that specific case, but we see that regularly across the country when hospitals consolidate and you want access to any member of that system, it is harder to to do that at a fair price when they are consolidated. And there have not been benefits in terms of better quality or access. >> so there's no example you could see in the country that would prove opposite of that. >> not that I can think of. >> thank you so much, miss mitchell. With that chairman, I yield my time. >> gentleman yields back.
▶ 2:45:53Now recognize the gentlelady from indiana, miss hudson, for her five minutes of questioning. >> thank you, Mr. chair. Before I get into my questions, I do want to make some clarifications. Uh, the democrats have made some accusations that we're trying to shift blame on the cost of health care.
▶ 2:46:08Uh, because we've we've cut spending in medicaid and medicare, but, uh, medicaid spending has increased and is expected to grow, uh, in from, uh, it grew 8.6% in fiscal year 25, expected to grow in spending 7.9% in 2026, medicare spending is projected to accelerate to 5.4% growth in spending annually through 2030.
▶ 2:46:32So it is simply incorrect to, to, to state that, uh, house republicans are cutting spending, even if we are spending less medicare and medicare spending is still increasing. Um, thank you to the witnesses for being here. Uh, healthcare costs are a top financial concern for american families. I won't deny that, uh, 1 in 3 americans are cutting back on daily spending to cover medical bills.
▶ 2:46:56Families are delaying major milestones such as buying homes or having children because of rising premiums. We do not have a functioning health care system currently, uh, that has been driven in large part by the institution of obamacare and principles that took the doctor and patient relationship and put in a great deal of middlemen. I consistently hear the same issues from providers in indiana.
▶ 2:47:24They're being squeezed from multiple directions simultaneously. Um, payment rates for medicare have fallen roughly 33% in real terms since 2001. While practice costs are climbing, administrative burdens consume resources that should be going to patient care and the consolidation of market power in both the payer and provider markets is eliminating the independent practices that historically kept costs competitive and care personal. This is the third hearing we've had on affordability.
▶ 2:47:53I think it may be the most consequential because the provider landscape is where these issues meet real patients. Doctor azouz, in your testimony, you note that practice costs rose roughly 63% over the same period that medicare physician payments declined by roughly 33%, putting an increasing strain on independent practices and threatening patients access to care, particularly in rural parts of the country.
▶ 2:48:19From your perspective, how is this sustained gap affecting patients ability to access timely, quality care? What specific actions should congress take to stabilize physician practices and prevent further disruptions? >> thank you. So, as I've noted, um, the decrease in, uh, real payment for medicare services is accelerating independent physician to close their offices or to sell their practices to private equity or to be employed by large systems.
▶ 2:48:49So, you know, the access is definitely impacted by that. People in their own communities can't access the private practice physician when they want to. And wait times are increasing significantly. Uh, and the biggest solution, as I keep emphasizing, is having a, having medicare payment reform tied to, um, the medical economic index with automatic inflationary updates, just like the other providers are receiving. >> when was the last time that independent practices received an update for inflation?
▶ 2:49:17>> we haven't received an update for inflation since I've been in practice. >> and how long has that been, sir? >> almost 40 years. >> um, would you favor, um tearing a system based on, um, uh, provider, uh, areas that may be in a desert or rural part of the country where independent practices might have a slightly different reimbursement rate than other systems to, to help keep them afloat.
▶ 2:49:43>> well, I think it's not unreasonable to offer incentives for physicians to open offices in primary care deserts, for example, or in ob gyn deserts. I think that's a creative approach, but I think the bottom line is all physician practices are substantially hurting at this point in time, and we need to do something to correct that in the form of an inflationary update. >> thank you. Um, in the remaining time I have, I want to shift gears a little bit. Continuing with you, doctor aziz.
▶ 2:50:10Um, the american medical association recently, uh, came out in with a new statement on transgender surgeries for minors with gender dysphoria. Um, now deferring that and recommending deferring treatment for that to adulthood. Um, can you comment on why the, the change or the clarification was made from the association?
▶ 2:50:36>> so I want to be very clear that the policy of the american medical association is that individuals with gender affirming disorders should be have access to the appropriate care. >> and I'm just specifically asking about minors. >> in surgery and minors. Our belief is that it should generally be deferred until adulthood. But we respect the physician patient family relationship and determining that.
▶ 2:50:59And, uh, we respect the fact that various medical societies that are experts in this care will be providing the appropriate input. And when those sorts of surgeries should be performed. And I want to also emphasize the number of such surgeries taking place in this country is remarkably little. It ranging from some people say 85 in 1 year to 220 out of a population of 300 million. >> I.
▶ 2:51:25Respectfully, sir, I always comment that it doesn't matter if it's 85 or 200 or one to the families that are impacted by that. If, if and to the individuals that have endured that as minors who have regretted that decision as adults. Thank you, Mr. chairman, I yield back. >> gentleman yields back. Now recognize the gentlelady of massachusetts, miss trahan for her five minutes of questioning. >> well, thank you, Mr. chairman. And thank you to our witness witnesses for being here today. Um, republicans claim that their signature legislation isn't taking health care away from people.
▶ 2:51:54But for me, the numbers just simply don't add up. Uh, states are being forced to grapple with a series of new federal policies all at once, right? We've got new medicaid eligibility requirements, mandated paperwork requirements, six month return, redeterminations limits on provider taxes and state directed payments, uh, the expiration of enhanced aca premium tax credits, reduced
▶ 2:52:25Nih funding changes to h-1b visas, and I could actually keep going. Um, these changes put enormous pressure on state health care systems, and they force states into impossible choices, reducing services, cutting provider rates, uh, restricting eligibility for coverage.
▶ 2:52:44In massachusetts, officials estimate the bill could cost the state $3.5 billion annually in federal health funding and leave up to 300,000 of our residents without coverage. Now, as all of you know, when people lose coverage, they don't disappear from our healthcare system.
▶ 2:53:04They still get sick, they still get injured, and they still show up in emergency rooms and safety net hospitals, an issue that's projected to increase demand on the massachusetts health safety net by an estimated $550 million by fiscal year 2028, states are projecting billions in lost health, uh, federal health funding, and significant increases in uncompensated care.
▶ 2:53:30My colleague rep ruiz highlighted this clearly, but it bears repeating that these cuts will directly drive up costs and make it harder for people to access their care. So, Mr. pollock, when hospitals are forced to absorb those costs, what kind of service reductions or closures do we typically see in communities across the country?
▶ 2:53:52>> I would highlight the word communities because we're a very diverse country and every community is different and every situation is very different. So there's no question that this is going to cause great stress. Uh, there's no question that there are going to be clogged emergency rooms as we are the family doctor to the uninsured. And there will need to be some changes in terms of the array of services that are provided.
▶ 2:54:17Now, I know there's been a lot of criticism of systems in this discussion here today, but systems are able to better organize the delivery of care so that certain services may be provided in one entity and others could not provide it, but still provided in the same location.
▶ 2:54:36So there's real value to systems that we really haven't talked about, but we're very concerned about the impact, and we're very concerned about the impact on people because if they delay the care, it's it care denied because they don't have the coverage yet. >> we're seeing maternity wards closed. That's not a hypothetical for massachusetts. Um, and when you can't get that care and that service close to home, it's pretty problematic for a woman carrying her, her child.
▶ 2:55:03And it's bad enough when hospitals are forced to close these services or maternity wards, behavioral health units, you name it. Um, but as you mentioned, when uncompensated care rises, hospitals still have to cover the costs. And that means higher prices for everyone else, particularly people with private insurance.
▶ 2:55:25So can you explain how increases in uncompensated care ultimately affect the prices that hospitals charge, commercial insurers, and what that means for people with private coverage? >> you know, we have been very open to the fact that between regular chronic government underpayment for medicare and medicaid, combined with an increase in the amount of charity care that is going to be provided, there's a cost shift and that affects the private sector because we have we have to stay whole to
▶ 2:55:56Provide 24/7 coverage for all of the things that we do. And as a result of those government underpayments, there is a cost shift there. And that's part of the reason you see costs rising on the private side. >> and we're seeing that with premiums, Mr. martin, beyond premiums, where else do costs of rising uncompensated care show up for patients or families seeing that in higher copays and prices for common services? >> yes.
▶ 2:56:22I mean, actually the high deductible health plans, we're seeing more cost sharing requirements on patients, which is creating offsets of them delaying or not pursuing health care, which accelerates disease states. And ultimately they end up in a hospital, a higher cost care setting. >> I appreciate I don't have time for my final list of questions. I'll absolutely submit them for the for the record, but I appreciate you being here and talking, uh, plainly about what we're seeing in hospital systems and the impact on its patients. Thank you.
▶ 2:56:53>> gentlelady yields back. Now recognize the gentleman from new york, Mr. langworthy, for his five minutes of questioning. >> thank you very much, Mr. chairman. Today's hearing comes at a time when health care costs continue to climb. Yet too many patients still have no clear sense of what their care will cost until after they receive the care.
▶ 2:57:09Uh, we know that hospitals and insurers and others across the system all play a role in what patients ultimately pay, with hospital and provider services now making up more than half of the total health care expenditures in this country. Now, despite that, in most parts of the economy, people can compare prices before making an ultimate decision. And in healthcare, that's often not the case.
▶ 2:57:32Uh, patients move forward without knowing what they will owe or how prices compare across providers offering the same service. If patients are expected to make informed decisions, they need clear and consistent information before care is delivered, and without that visibility, it becomes much harder to understand what is driving costs across our health care system and where those costs ultimately will fall. Uh, and with that, Mr.
▶ 2:58:00Pollack, I understand that the aha has expressed support for implementing advanced explanation of benefits in his work with stakeholders to develop a mock claim approach to make that process, uh, workable.
▶ 2:58:16Can you explain how that approach would help ensure that patients receive accurate cost estimates before receiving care, and how you and your system are working with your insurer counterparts to make sure that that information is consistent, reliable, and accurate for patients.
▶ 2:58:35>> we think that that approach is really something that has promise, and I commend you for your support and leadership in this regard, because it'll give patients accurate information on the front end in terms of what they can expect in advance of their care. And I think that's what most patients really want to see. And as you said, we're working with stakeholders and we want to work with cms and you all to move in this direction.
▶ 2:58:59I will say that we are deeply committed to providing patients with the information, the transparency that they need relative to the cost of care. Um, there's. We're all there on that, but I would also share with you all that we are in a very confused state. And that's why this advanced eob has promise. You know, we've had the hospital transparency rule. Then we had the health insurer transparency rule. Then we had the no surprise act.
▶ 2:59:26And right now it's kind of a jumble of different things as to where you get that. And that's why that approach is real important. Last point I can make I'd like to make please, is that it's also important. Transparency is really important for shoppable services. But I just saw a number over 50% of hospital admissions come through the edi, the acp, the emergency physician society, say it's up to 70%.
▶ 2:59:52I don't know that you can shop around for those particular things, but regardless, we need to do better and your suggestion is a way to do it. >> we need transparency across the entire system, and we can't get our arms around the entirety of our health care spend in this country until we truly understand where the dollars are going. Um, staying on transparency, Mrs. mitchell, in your expert opinion, how usable is hospital price transparency data? >> it is increasingly usable. Unfortunately, we don't have, um, good compliance.
▶ 3:00:20Uh, estimates are at most 69% of hospitals are fully compliant. So we need more transparent information. But once that information is available, self-insured employers can and are using it to identify who are the higher value providers in their community or where can they, uh, maybe revisit some of the pricing when it is compared to other benchmarks? It is incredibly important for them to actually be fiduciaries and know if and when they are paying a fair price.
▶ 3:00:52>> Mrs. mitchell, does pbj support broader implementation of an advanced explanation of benefits, and how effective do you think it would be in improving price transparency for patients? >> we think patients and employers are absolutely entitled to full transparency upfront. It is. It is simply unworkable when a patient goes in and comes out with $100,000 bill, it is not responsible of the system to burden patients with that type of cost.
▶ 3:01:20And we we need to give patients and purchasers the information they need to make good decisions. >> while improving price transparency in healthcare is is critical to empowering patients and helping them understand what they have to pay before they receive the care. And, you know, certainly emergency departments, there's, there's certain things that it's tough to, you know, guess what you're going to pay after you're getting procedures in a car accident.
▶ 3:01:46But there are many predictable, uh, parts of our healthcare system that we can do that. And patients should be able to see the cost of care upfront, understand where their money is going, and make informed decisions before receiving treatment. Right now, too many prices are still hidden. We need better visibility across the health care system so that we can clearly see where the costs are coming from and who's ultimately bearing them. And by bringing these costs into the open, we can create a more competitive system that works better for patients. I appreciate all the witnesses for being here with us here today. And I yield back, Mr.
▶ 3:02:17Chairman. >> gentleman yields back just so that we can get the state of play, so that the witnesses will know where we're at. I appreciate your time. I have not yet gone. I'm going to recognize myself. And then, Mr. james, we may have somebody else that walks in that I'm unaware of, but I think that'll be the last two. But you never know. Somebody could of the from the committee could walk in any second. So I will now recognize myself for five minutes. Um I raised it in my opening statement. Doctor g digiorno giorgio has raised it. Doctor joyce has raised it. I think miller-meeks at least touched on it.
▶ 3:02:46And that is that the affordable care act placed a ban on physician owned hospitals. So for the whole panel, we'll make it easy. Just raise your hand if you support the ban on physician owned hospitals. So if you raise your hand, you're against physician owned hospitals. Okay. And let the record reflect that, uh, Mr. pollack was the only hand that went up. I understand that means some of you may be ambivalent. I'm not trying to put you on the record. I just want to know where to go with my questioning.
▶ 3:03:14Um, and, and I would say that it's interesting because certain hospitals already receive special designations like our critical access hospitals, critical access hospitals must be rural. They do have to be nonprofit and located more than 35 miles from another hospital. Mr. pollack, you support the critical access hospitals, do you not? So this is where the question comes in, because in order to accommodate widespread stark law concerns, I tweaked the physician owned hospital bill.
▶ 3:03:41It's now called the physician led and rural access to quality health care act to allow for physician ownership for of rural hospitals more than 35 miles from a main patient campus or critical access hospital. In order to mirror the critical access. Because I represent a lot of areas where they want hospitals, we just filled that need. Just a few months ago in patrick county, virginia, a new hospital opened up.
▶ 3:04:07And interestingly, while it had a corporate identity, uh, it's run by doctors. Uh, it's got a corporate identity, but it's, it's pretty darn close to a physician owned hospital. And this hospital has been closed for a number of years because none of the systems that you've referenced wanted to get involved. And this group has figured out a way to make rural healthcare in underserved areas a reality.
▶ 3:04:35Are you opposed to that form of physician owned hospital as well? >> we're not opposed to creating access points for care in rural areas, for sure. The issue with physician owned hospitals different from critical access hospitals is they're not full service hospitals. A lot of them don't have emergency rooms. They don't take medicaid. They don't care for the engine. They're not open 24 over seven.
▶ 3:04:57They take the easier well-insured cases and call 911 when something goes bad and ask us to come to the rescue. >> okay, so what you're saying is if we created a model where they were open 24 seven and they had an emergency room, you'd be okay with the physician owned. >> hospital if I can add a couple of other things. Yada yada, yada. No, no, seriously, um, the. >> time runs fast. As you heard buddy carter say, time flies when you're sitting up here in five minutes goes by. Quick.
▶ 3:05:28Doctor de giorgio. >> yes, sir. >> your comments on that? >> uh, I. >> think all the behaviors that he's describing can also be attributed to non-physician owned hospitals. There's nothing special about a physician owned hospital that prevents it from having an er. In fact, there are plenty of physician owned hospitals that do have ers. There's plenty of physician owned hospitals that have l and d units and that are open 24 over seven. There's plenty of physician owned hospitals that are super specialized, focused factories that do nothing but orthopedic procedures. All of these physician owned hospitals expand access to care and drive down prices.
▶ 3:05:57Talk about price transparency. Physician owned hospitals are leading edge on price transparency because they have to compete, and they have to show that the people who come to their hospitals, that they are competing on both price and quality. >> I appreciate that because I do think that long term and historically in a large rural district like I represent, uh, it's larger than nine states by landmass.
▶ 3:06:19Historically, when you look at the histories of the various hospitals, even if they're not physician owned today, they may have started out, most of them did start out as a physician owned hospital. Alright, switching gears, I'm going back to you, Mr. pollack. In our hearing with health insurance executives, I raised the question or the issues that there have been, uh, in that there have been negotiations for health insurance rates in my district in virginia and miss harshbarger's district in tennessee.
▶ 3:06:45And I wanted to know if the insurance companies, how they reimburse larger systems versus smaller systems. And they just came back with a generic, oh, everything's a little bit different. Do you see that? Because I get the impression that the larger systems get a better deal. What are your thoughts? >> uh, it's uneven. I don't think it's a yes or no type of thing.
▶ 3:07:06Um, I think one of the things you have to appreciate is that the insurance companies that these systems negotiate with are very, very large entities. Um, and they are very concentrated. And when you negotiate a system with, uh, united healthcare, which is a $330 billion conglomerate that has immense, uh. >> what time is my time is running out.
▶ 3:07:31What you're saying is it's hard to negotiate when you don't have as much competition and when you have, uh, big entities taking over the entire market and then dictating what happens is that what I'm hearing? >> and that's the on the insurance side, we are price takers from them. Yeah. >> and it could be applied also to hospitals in certain circumstances. That, uh, ends up my time. I'll probably have some more questions. For the record, I greatly appreciate all of you being here today. And I will now recognize the gentleman from michigan, Mr. james, for his five minutes of questioning. >> thank you, Mr. chairman.
▶ 3:08:00I'm so grateful for you having this hearing and to our guests for being here. Let's be clear about this hearing today. Health care in america is not just expensive, it's deliberately opaque. Patients don't know what health care costs are until the bills show up. Employers don't know what they're paying until premiums go up and taxpayers are left holding the bag. In a system that too often rewards consolidation over competition and secrecy over accountability, we've heard today that consolidation is driving prices higher without improving quality.
▶ 3:08:28In fact, hospital dominated markets can raise prices significantly, sometimes by double digits, while limiting patient choice. We also know the rules that were supposed to fix the system are not followed. Nearly half of all hospitals are still not complying with federal price transparency requirements. That's unacceptable. When prices are hidden, patients lose power. When patients lose power, prices go up and when costs go up.
▶ 3:08:55Families in michigan and across the country are forced to make impossible choices between care and groceries, between prescriptions and rent. This is exactly why I introduced the patients deserve price tags act. It's simple if you're charging patients, you should be transparent with patients. Post the real price, post the rates, make it accessible, accurate, and enforceable. Because transparency is not a partizan issue, it's a fairness issue. It's a competition issue.
▶ 3:09:22And most importantly, it's a patient issue. We don't fix affordability without fixing accountability and we don't get accountability without transparency. So, miss mitchell, you represent employers covering 21 million americans and spending more than $350 billion on healthcare annually. So let me ask you directly, if employers and patients cannot see real prices up front, is it even possible to have a functioning healthcare market? >> it is not. We are 100% supportive of transparency.
▶ 3:09:49As a fiduciary, we are obliged to only pay fair prices. You can't do that without the information. >> wonderful. And when prices are hidden or incomplete, who benefits more the patient or the system charging the price? >> clearly the system. >> thank you, miss mitchell. You also highlighted even large employers struggle to access usable pricing data and face barriers created by the system itself. At the same time, we know that federal transparency rules exist, but compliance is inconsistent at best and enforcement is weak.
▶ 3:10:18If congress were to require complete, accurate and regularly updated price disclosures in uniform format, would that materially improve employers ability to lower costs? >> absolutely. And we will use that information as it's available. >> outstanding. Miss mitchell, final questions. If every patient and employer had access to actual negotiated prices, cash prices and comparable data before receiving care, would that increase competition and drive down costs system wide?
▶ 3:10:49>> absolutely. We need both competition and accountability. So much of the price distortion is just unexplainable in terms of the service provided. We need to be able to know where to go for the highest quality, most fairly priced service, and transparency enables that outstanding. >> and finally, is it fair to say that the more complete and enforceable the transparency requirements are more effective? They will be at lowering costs for american families? >> absolutely. Apparently the industry thinks they're optional because they've had five years to comply and they are still not complying.
▶ 3:11:19So I think enforcement is at this point warranted. >> that is unacceptable, and we should hold them accountable. Mr. chairman, with that, would the. >> gentleman yield to me? >> I would remain yield, remain remainder of my time to the chairman. >> I appreciate that that was a question I hadn't had time to get to. So, miss mitchell, I've long supported the transparency because I think it brings about certain disruptors into the system. When you can see the transparency prices, they figure out ways that they can make money by making the system better, lowering the cost for everybody.
▶ 3:11:46Um, and one of those is to allow with, with transparency is to allow companies to come into the market to operate without a traditional network in the health insurance field, allowing members to see the licensed, the any licensed provider induced, including non-network or out of network doctors without penalties and allowing patients to shop around for the best prices. Would you agree that disruptors like that are benefit long term to the system? >> I think everyone benefits.
▶ 3:12:17If you can identify and go to the highest quality, most fairly priced provider regardless of network. >> and you can't figure that out if you don't know what the prices are. >> you can't. And then to make it worse, a lot of these anti-competitive practices make it hard to exclude them once you have identified them. So it is a compounded problem of lack of transparency and consolidation. >> I greatly appreciate it, and I yield back the remainder of Mr. james's time. And with that, that concludes all the questions.
▶ 3:12:45I don't see anyone else here wishing to ask questions. I ask unanimous consent to serve in the record the documents included on the staff hearing document list, including Mr. carter's request earlier for three documents that that he three articles that he wanted in included, without objection, so ordered. I would like to thank all of our witnesses again for being here. Um, members will have additional questions. You heard several of them say so I know I will, uh, a number of people will have additional written questions for you after the hearing.
▶ 3:13:14I remind members they have ten business days to submit those questions for the record and ask the witnesses to respond to the questions promptly. Members should submit their written questions by the close of business on wednesday, april 1st. That does not mean the questions will be foolish. They will be wise, but nonetheless. Wednesday, april 1st, without objection, subcommittee is adjourned. Thank you. Witnesses.