▶ 0:16:08We We're all set.
▶ 0:16:09Yes, sir. The joint hearing of the health and oversight subcommittee will come to order. Good morning and thank you to the witnesses for being here today to discuss an important issue. Medicare advantage or MA.
▶ 0:16:32MA is a very popular health insurance program option that plays a vital role in providing highquality affordable care to millions seniors, including over 100,000 for my district in Florida. Nationwide, 54% of Medicare beneficiaries choose MA plans over traditional fee for service Medicare plans. In Florida, 60% of Medicare beneficiaries are enrolled in MA.
▶ 0:17:00MA beneficiaries spend less on care and have a better health outcome than those that do a traditional Medicare, leading to lower and more efficient cost across the system. MA beneficiaries generally also have more access to benefits traditionally Medicare that doesn't offer like low cut uh lower out-of-pocket costs, vision, uh hearing coverages, prescription drugs, prevention
▶ 0:17:30services, and chronic diseases, management care, and a host of other sub supplemental benefits. I'm very excited about the supplement uh benefits MA provides to improve health and wellness such as access to fitness memberships wearable technologies and health meals optional. 95% of MA beneficiaries are satisfied with the care they receive and it's important to to examine the program to ensure MA continues to deliver for patients.
▶ 0:18:00For example, we have heard many stories of excess prior uh authorization and payment delays that negatively impacts uh patients. Outdated financial incentives may also contribute to some of the unjustifiable payments in the MA program. Fortunately, we have the ability to modernize the benefits to ensure patients receive the best care, reduce burden on providers, and better manage overall health care cost.
▶ 0:18:30Transparency is crucial for maintaining a trust in the system and ensuring efficient use of taxpayer dollars. I believe we can protect the integrity of MA while ensuring it remains a strong option for beneficiaries. I look forward to discussing discussing the opportunities today with our witnesses. I hope all my colleagues will focus on the topic at hand. Now, I'm I'm pleased to recognize the gentleman and my good friend from Texas, Mr. Dogget for his opening statement.
▶ 0:19:01Well, thank you very much and thank you, Mr. Schwikert, as well. Uh, I'm very pleased that these committees are finally addressing some genuine waste, fraud, and abuse. Early in the reconciliation process, I led several colleagues in urging the Republican leadership to focus on waste in the Medicare Advantage program rather than cutting coverage. While that request was unanswered, today we have an opportunity to start paving a new bipartisan path toward fiscal responsibility.
▶ 0:19:30A path that protects both taxpayers hard-earned dollars and their access to care. Medicare Advantage was sold as a program to save taxpayer dollars and improve the quality of care. But I found that it is largely disadvantage, never saving taxpayers a penny and vastly outspending traditional Medicare.
▶ 0:19:49While some of us have differing views concerning MA and its position in the future of health care for seniors and individuals with disabilities, I know we are all concerned with wasteful overp payments and assuring the long-term promise of Medicare for future generations. The nonpartisan independent Medicare payment advisory commission or MedPAC estimates that taxpayers will spend 20% more this year for people in Medicare Advantage than if they had been enrolled in traditional Medicare.
▶ 0:20:19That amounts to $84 billion this year alone. And these funds don't just impact Medicare's long-term finances. Every single enrolly is paying an average of $198 more in part B premiums this year because of overpayments to MA insurers. What are consumers getting uh for all this money? Well, outrageously, many are just facing care delays and denials, fewer and fewer provider options, and poor consumer service.
▶ 0:20:50For providers, MA is becoming more trouble than it's worth. An Austin surgeent, Dr. Elizabeth Potter was pulled out of surgery to talk to United Healthc Care representatives about an authorization she had already received for the procedure she was in the middle of performing. When she fought back, United sought to discredit her and is denying coverage for her surgery center, driving her into debt as she turns to a GoFundMe page to keep her practice afloat.
▶ 0:21:18Stories like hers are why I've urged the Justice Department to expand the investigation into United to closely examine every allegation of fraud, waste, and abuse, including reported denials of necessary For years, I've heard from hospitals, home health care providers, and uh other uh professionals who are experiencing increasing administrative burdens, delays in reimbursement, and smaller payments that are falling below what traditional Medicare would have paid.
▶ 0:21:48Together with uh my colleague Dr. Murphy. We've authored the Prompt and Fair Pay Act, bipartisan legislation that we filed this week to ensure MA plans at least pay what traditional Medicare pays for covered items and services. Our bill also establishes prompt payment requirements modeled after the requirements in part D.
▶ 0:22:09It has been endorsed by the National Rural Health Association, Leading Edge, Leading Age, America's Essential Hospitals, the American Academy of Family Physician, the American College of Physicians, and a number of others. Last month, we also filed bipartisan legislation in which uh Chairman Schweiker participated to address an outrageous loophole that permits Medicare Advantage plans to receive premiums and capitated payments from duly eligible veterans.
▶ 0:22:39who receive most or sometimes all of their care through the VA. Researchers have estimated that this loophole will cost the VA over $350 billion over the next decade as taxpayers really are paying for care twice. Once to the MA insurer who pockets the money and a second time to the VA which actually delivers the care that it is wrongly prohibited from recouping its cost from the insurer.
▶ 0:23:05We've authored the bipartisan Guard Veterans Healthc Care Act to stop this waste and ensure the VA can bill MA for Veterans Care in the same way that they do other commercial insurers. Our bill is widely supported by the Veterans for Foreign Wars, the Medicare Consumer Groups, and a number of unions that serve veterans. I appreciate the support of Dr.
▶ 0:23:25Murphy and Chairman Schwikard in these measures and I know they remain committed to additional bipartisan work to end waste and abuse in this program to ensure a sustainable program for future generations to stabilize provider payments and improve the delivery of health care for all Medicare enroles. I hope that this hearing will be swiftly followed by a markup on our legislation and other urgent items to take some of the disadvantage out of Medicare Advantage. Thank you, Mr. Chairman.
▶ 0:23:55Thank you, Ranking Member Dogget. I now recognize the gentleman from Arizona Oversight Subcommittee Chairman David Riker Swiker for his opening statement.
▶ 0:24:06Thank you, Mr. Chairman. Um, look, I care passionately about this subject. Um, I want to put a couple things out. Um, I'm actually a fan of managed care as long as the incentives are designed from those of us who sort of grew up in the early literature from the late 70s, early 80s that managed care was going to be a model where the incentive is as an organization, we benefit by helping people become
▶ 0:24:36healthier. In an age of technology, miracle drugs, the abilities now to help people with their BMIs and other things, I will argue that if we read through the MedPAC reports from the last decade, the incentives are misaligned. That's all in many ways my legislation. This help us. Um, and there there's some points I want to make. Um, this is one of the reports. We often call it the beneficiary to worker ratios.
▶ 0:25:07Please understand from a global standpoint. This is more for all the members sitting here on this committee. In seven years, the Medicare Part A trust fund is empty. We actually have an issue where in just a few years I have two and a half less than two and a half workers per Medicare beneficiary. We have it's demographics, it's math.
▶ 0:25:31Um, it has also become public that oversight has actually been doing inquiries for months. Um, I want to thank for particularly if there's representatives here, a number of the MA companies have been remarkably open in helping us understand um their distribution models, how they work, how they score.
▶ 0:25:54A a couple have been a little crankier, but we have maybe tens of thousands of pages that we're running through our data systems and those things trying to document. And Mr. Mr.
▶ 0:26:08Chairman, when it hits the right moment, I am going to submit a whole series of articles from the Wall Street Journal series to I think there's a ProPublica article, some others in here which document where maybe they weren't the MA provider itself and a contractor, but individuals who have been risk scored with diseases they don't have.
▶ 0:26:33And if the MedPAC report is correct, and I know there's some controversy in the scoring, but even when we've done um distributional, taking just those in fee for service, stripping out those who just choose to just take the hospital portion and adjust for cost. Um if you look at the last decade of MA reports or see um uh MedPAC reports you have 15 to 20 and um some reports that may be even slightly higher.
▶ 0:27:03just multiply that cost over fee for service and then the fact that our promise particularly those of us as Republicans who are substantially responsible for this design when this came into effect in 2005 Medicare part C it was going to come in at 95% of fee for service if our culture really is the moment where we understand the power to society of having a healthier society Can we
▶ 0:27:34work with the insurers? Work with CMS, work with MedPAC, work with my Democrat brothers and sisters, my Republican brothers and sisters, get the incentives aligned. As did I mentioned before, our baseline obligation looks like it's 16 trillion dollars over the next 10 years. This isn't a game. This is one of the biggest things in our government. Let's get this right. And with that, I yield back, Mr.
▶ 0:28:04Thank you, Chairman, Miss Wacker. I now recognize the gentleoman from Alabama, Oversight Ranking Member Terry Schw, for her opening statement.
▶ 0:28:12I'd like to thank the chairs and uh ranking member uh for today's hearing. And of course, a special thank you to all of our witnesses who are here today. As this committee hears testimony on Medicare Advantage program, we cannot forget that just a few weeks ago, House Republicans voted for the largest cut to health care in our nation's history. Because of Trump and congressional Republicans, 17 million Americans will be kicked off of their health care.
▶ 0:28:40More than 300 rural hospitals will be at risk of closing. And half of our nation's nursing homes will have to cut staff in order to keep their doors open. My constituents deserve access to quality, affordable health care, whether they live in Birmingham, Alabama, or the rural black belt. However, Trump's cuts to Medicaid will leave over 219,000 Alamians without the care that they deserve and need.
▶ 0:29:09Moreover, the Alamians that do not lose their health insurance will face rising costs and decreased coverage. Despite efforts from Democrats on this committee, Republicans voted against the advanced premium tax credit which made it possible for millions to be able to afford their own health care plans.
▶ 0:29:29Today, while we focus on ways to improve Medicaid Medicare Advantage program, we cannot focus on effective reforms and solutions without accounting for the chaos and upheaval our nation's health system will face because of Trump's big ugly bill. As a representative from areas, both rural and urban underserved areas, maintaining access to hospitals for my constituents is a matter of life and death.
▶ 0:29:55It is out of this concern that I urge this committee to protect hospital access by strengthening the financial stability of health systems serving Medicare beneficiaries through legislative reform. Americans, especially our seniors, need reliable, affordable health care coverage. Currently, over 54% of Medicare beneficiaries are enrolled in Medicaid Medicare Advantage programs.
▶ 0:30:22Um, additionally, we are spending about 20% more per beneficiary on Medicare Advantage compared to traditional Medicare. With its increasing popularity, Medicare Advantage plans present a great opportunity for this committee to introduce legislative reform. As ranking member of oversight, I agree that we must examine troubling practices in Medicare Advantage program, which have created financial nightmares for health systems and providers across this country.
▶ 0:30:52Many health systems and providers have continued to voice concerns regarding abuse of prior authorization, denial rates that are sky-high, payment delays, overpayment in programs, increased administrative burdens, and a lack of transparency to name a few. Another significant concern is the lack of oversight within Medicare Advantage.
▶ 0:31:13In 2024, Medicare spent $83 billion on rebates for sub for supplemental benefits, representing more money than Medicare spent on the entire the entire physician fee schedule. Yet, this committee does not have any systemic records or data on supplemental benefits cost or utilization. There is simply no information regarding how often or not enroles use these benefits.
▶ 0:31:42We must work to first improve the transparency within Medicare Advantage to gain access into the true nature of the problem this committee needs to resolve. It is clear given the number of beneficiaries choosing Medicare Advantage plans, the program is here to stay and when done accurately will give direct benefits. So we must ensure that the program is not limiting access to health care in our most vulnerable communities.
▶ 0:32:11I look forward to the hearing and to hearing from our witnesses about Medicare Advantage and what we can do to reform it in order for it to meet the promise that it uh brought when it was first uh implemented. I think it's really important that we focus especially on the the denial rates and I have to tell you I'm quite concerned that AI will only exacerbate that.
▶ 0:32:34And so I think that now is a great time for us uh to work together, Republicans and Democrats, to actually make Medicare Advantage meet its its promise. Thanks. And I yield back the balance of my time.
▶ 0:32:46Thank you. I will now introduce the witnesses. Miss Don is CEO of Align Alignment Health Plans and president of Alignment Health. Dr. Brian Miller is associate professor of medicine and business at John Hopkins University. Mr. David Basil is vice president of health clinics at a uh
▶ 0:33:08Turn the light.
▶ 0:33:09Dr. J Dr. Jane is CEO of scan health plans. Dr. Matthew Feeder is a senior fellow with the Brooklyn Institute. Thanks. Thanks for all of us for you guys joining us today. Your written statements will be made part of the hearing record and each you you'll have five minutes. try to if you can stay to that to deliver your oral remarks. Uh, Miss Baron, you're you're recognized.
▶ 0:33:37Well, good afternoon. Uh, Health Subcommittee Chairman Buchanan, Oversight Subcommittee Chairman Schwikert, uh, Health Subcommittee Ranking Member Dogget, Oversight Subcommittee Ranking Member Soul, and distinguished members of the Health and Oversight Committee. Thank you for the opportunity to speak with you today about the past, present, and future of Medicare Advantage.
▶ 0:34:01My name is Don as was announced, and I serve as the CEO of Alignment Health Plan, a fast growing and highly rated Medicare Advantage care delivery organization that supports more than 200,000 seniors across Arizona, California, North Carolina, Nevada, and Texas. People often ask me why did I join alignment in 2014 and the truth is it was personal.
▶ 0:34:28After 25 plus years in healthcare I wanted to be part of something that was wasn't just talking about transformation but actually doing it. Our founder John Ko built Alignment Health after watching his own mo mother mother fall through the cracks of a fragmented health care system. Unfortunately her experience wasn't unique but it was unacceptable. At Alignment Health, we believe seniors deserve more than just coverage. They deserve care that is coordinated, proactive, and human.
▶ 0:34:58That belief came to life for me in one of our one of my earliest moments at Alignment Health showed me the power of seeing the whole person. One of our doctors was conducting a virtual visit with high-risisk with a high-risisk senior who was flagged via a recent uh flagged in our system via recent lab test that came through by our proprietary data platform for abnormally low blood sugar. Our technology helped us catch the issue, but the real insight came during the virtual home visit.
▶ 0:35:29His blood sugar was low because his ref refrigerator was He didn't need an ER. He actually needed He hadn't engaged with us before despite being eligible for our Care Anywhere program for high-risisk members because he didn't trust a health plan to do the right thing.
▶ 0:35:48But when we sent him a $30 pizza instead of sending him to the hospital is not only it not only avoided unnecessary um an unnecessary $20,000 hospitalization, it built trust and we kept showing up and enrolled them into a program for meal delivery. This is what alignment does and how we operate. We put the senior first. We support the doctor.
▶ 0:36:17We enable it all with smart technology and a culture of being a being an organization that has a serving heart. One of the ways we lead with a serving heart is by implementing Medicare Advantage the way that it was intended to be many many years ago. If you think about it, a virtual cycle that uses artificial intelligence to identify the sickest members who drive 80% of the cost.
▶ 0:36:42not to prevent it, not to deny it, but to be proactive in that integration of proactive health care. We identify these individuals and we surround them with a home-based preventative personalized care plan that provides more care to the beneficiaries who need it most. Often preventing costly interventions before they need it. It's how we do well by doing good.
▶ 0:37:10caring for those who can't care for themselves, reducing overall cost, and reinvest reinvesting in those savings into richer benefits that let us serve even more seniors. While many in the industry have lost sight of Medicare Advantage advantages purpose, we haven't. We're doing it the right way and we're proving that the model was always meant to be. What we do every day is working and it should serve as a model for a thoughtful government policy.
▶ 0:37:37Our strong collaborative relationships with provider partners allows us to use medical management tools such as as prior authorizations far less frequently. In fact, over the past 18 months, our prior authorization denial rate has stayed below 2%. That is less than a third of the industry average. Today, every Medicare beneficiary we care for is enrolled in a fourstar plus plan or higher.
▶ 0:38:06and we're proud to be one of nine Medicare Advantage plans across the country that has five star plans for two states, North Carolina and Nevada. Most importantly to me and our entire team, Medicare beneficiaries trust us. Our care anywhere program serve serving alignment's most vulnerable and highest risk population has earned us a net promoter score of 78.
▶ 0:38:32Significantly higher than our healthcare industry peers and on par with the beloved consumer brands like Apple and Costco. These results do not happen by accident. They're the product of intentional design for better care, better experience. and better outcomes. It's what successful looks like when Medicare Advantage is done right. It serves seniors, taxpayers, communities, and your constituents in the best way possible.
▶ 0:38:58We believe Medicare Advantage is strongest when encourages when it encourages competition, supports innovation, and prioritizes outcomes that matter to seniors. But current barriers like uneven hospital access, changing rules around supplemental benefits, outdated quality measurement tools, limited flexibility for dual eligible populations, and in inconsistent broker practices can all get in the way of delivering that
▶ 0:39:30Thank you so much for the opportunity to present to you today.
▶ 0:39:33Thank you, Dr. Miller. You are now Thank you chairs Buchanan and Schweikert, ranking members do and Sul and distinguished members of the subcommittees on health and oversight. I thank you for allowing me to share my views on the challenges and opportunities in the Medicare Advantage program today. I should note that I'm practicing physician. In fact, tonight I work overnight in the hospital. So I've had a lot of coffee.
▶ 0:39:56Today I'm here in my personal capacity and my views don't necessarily represent those of the John's Hopkins University, the American Enterprise Institute, the Medicare Payment Advisory Commission, or the North Carolina State Health Plan. Disclosure aside, I want to focus on three areas. One is beneficiaries. So I put together this slide and why the answer is is what do you get when you buy MA? When you buy MA, you get a holistic health benefits package.
▶ 0:40:24So the taxpayers provide A and B and if you're in fee for service you have to buy a metagap plan and you have to buy a part D plan. Those are the two major supplemental benefits that are included in Medicare Advantage. So a lot of people ask what are the supplemental benefits of Medicare Advantage? It's metagap coverage and integrated part D prescription drug coverage. Then the question is who's in MA? Who's in it?
▶ 0:40:52I can tell you that there are 5.4 million retirees in group MA plans and many of those retirees are union members and state employees and local employees of local government who get their retirey health benefits.
▶ 0:41:12MA has more minority bennies and it also has more uh uh those who are socially econom and economically disadvantaged who cannot afford a Medicare supplemental plan. My grad student pointed out what fee for service Medicare is. He said fee for service Medicare is for the financially secure. MA is for the people.
▶ 0:41:37fee for service Medicare care and metagap enrollment is 91% caucasian and is primarily for the wealthy. So we should look at making these programs better, but we need to recognize that Medicare Advantage is fundamentally a safety net program. Some want to standardize MA benefits as they believe that people who use agency can't make choices when they turn 65. That's like saying you can have a model T in any color you want as long as is black.
▶ 0:42:06Instead of limiting choice, we should give seniors better tools to filter choices by improving the The second concern people have and an important stakeholder group of which I'm one is physicians and other clinicians. What should we do? This is pretty easy. The Biden administration undertook some early prior authorization reform and Secretary Kennedy has also embraced prior authorization process reform in conjunction with industry. We must crush the fax machine lobby together.
▶ 0:42:36It's not a partisan issue. We should make it easy to submit data as part of routine clinical care and we should automate approval, not denial. The other thing that we must do is we must recognize that managed care and utilization review addresses a lot of practices that we were concerned about when we passed Stark law 20 plus years ago.
▶ 0:42:58We should support a stark law waiver in the setting of managed care to support private practice and physician-owned enterprise to compete against big hospital monopolies. The third question is of course taxpayers. We have to get the math right and focus on solving problems. Instead of complaining about coding and intensity, let us automate it at the point of care with physician oversight and physicians in the driver's seat. We also need to better measure the questions of value of fee for service and Medicare advantage.
▶ 0:43:30We need to examine the per component per component benefit cost, the cost of a holistic health benefits package and compare statutory program program spending. All three measures matter. Currently, we only do the last one. When we compare the programs, we also need to look at fee for service versus MA at initial Medicare program enrollment. examine those who switch between programs and also compare those who stay.
▶ 0:43:57Unfortunately, many recent analyses only examine beneficiaries who switch from fee for service to Medicare Advantage, which is less than 5% of the Medicare population. I would point out that in 2023, 2.8 8 million people entered the Medicare program and slightly less than half of those entered Medicare advantage and slightly more than half entered fee for service Medicare. Elderly and disabled Americans deserve better in analysis.
▶ 0:44:28It isn't measure twice, cut once. It is measure 100 times and cut once. A rule that we have in hospital medicine applies here in health policy. Don't break the old people. Thank you. I look forward to your questions. Thank you, Dr. Basil. You are now recognized.
▶ 0:44:46Thank you, Chair Buchanan, Chair Schwikert, and honored committee members. I'm Dr. David Basil, VP of clinical quality population health officer for a Vera Health, headquartered in Sou Falls, South Dakota. I'm a practicing physician board and internal medicine and pediatrics. Administratively, I'm responsible for our clinical quality programs and overseeing our valuebased programs such as Medicare savings programs, Medicare Advantage, and commercial accountable care organizations.
▶ 0:45:11Additionally, I oversee our physician adviserss, which are a group of frontline practicing physicians who work closely with our utilization review and clinical documentation integrity teams to mitigate payment denials and non-payment issues with insurers. This combination of responsibility allows me to see both the importance of improving quality and managing costs as well as ensuring fair reimbursement to our facilities.
▶ 0:45:33A vera itself is nationally leading rural healthcare delivery network consisting of 37 acute hospitals, 200 clinics, 40 long-term care assisted living facilities, home care and hospice. Our acute hospitals range from large tertiary centers to small centers across South Dakota, Iowa, Minnesota, and Nebraska and include 31 critical access hospitals as well as rural health clinics and partnerships with federally qualified community health centers.
▶ 0:45:57A Vera's insurance division of Vera Health Plans provides individual group and Medicare supplement plans as well as a Vera partners with a larger insurer to offer its own provider sponsored Medicare Advantage plan. A Vera's dual role as both payer and care provider allows for more effective management of patient care and quality outcomes. We offer a comprehensive integrated care system that spans over 100 primary care clinics all the way to hospice services covering wide geographic area.
▶ 0:46:23This integration enables us to deliver more coordinated care under one system. Medicare advantage is important option to many people and it provides important benefits. Uh that is why Envir Medical Group partners with this large larger insurance provider to do a provider sponsored plan. These benefits include potentially lower premiums, built-in prescription drug coverage and extra benefits including dental, vision, and hearing in many cases.
▶ 0:46:49Also, some MA products have low no copay and maximum out-of-pocket limits. From a population health perspective, MA plans have the potential to support a broader definition of health as opposed to just paying for sick care. However, on the healthcare delivery side, we are seeing issues such as payment denials, authorization delays, and non-payment by MA plans that are hitting our rural facilities and their patients particularly hard. Some specific areas that are problematic include volume of denials.
▶ 0:47:19Our volume of care denials have more than doubled since 2022. Even though we overturn more than 70% of these denials, the administrative burden continues to climb. For example, MA plans may attempt to downgrade inpatient stays outpatient observation status, but not follow the standard traditional Medicare definitions of qualifying admissions. This generally decreases the payment amount and oftentimes will increase the out-of- pocket cost for beneficiaries.
▶ 0:47:44And MA plans are also often not held to the same standards of traditional uh care for definitions such as sepsis uh that you follow for quality bundles and other coverage. Post-accute authorization delays. Another area where we are seeing significantly more activity by MA plans is a reduction in approved post-accute facilities and increasing time to approve discharge to skilled nursing facility.
▶ 0:48:09This often results in additional days in the hospital waiting for discharge approval from the plan which increases hospital costs and delays the patient getting appropriate convolescent care. Critical access hospital length of stay partial denials. We are seeing MA plans starting to refuse payment for longer patient stays stating they exceed expected length even when that longer length of stay is directly related to post-accute authorization delays as described before.
▶ 0:48:35Readmission non-payment readmissions are a critical quality of care concern and traditional Medicare. CMS incentivizes hospitals to avoid inappropriate readmissions via the readmission reduction program. However, we have seen MA plans take a different approach and penalize both patients and hospital by refusing to pay for any readmissions within 30 days, even if totally unrelated to the initial episode.
▶ 0:48:57For exa for example, a patient could be initially admitted for a heart attack, go home and fall two weeks two weeks later and get readmitted and the MA plan will refuse payment for the second Overall, these and related issues drive the cost of caring for MA patients up while reducing the actual payment for MA patients. Rural hospitals especially struggle as many times staff fill multiple roles and don't have the capacity to specialize in utilization review or clinical documentation roles.
▶ 0:49:25In conclusion, the administrative burden and volume of appeals associated with MA plan denials continues to grow. These discrepancies compromise timely access to care, increase physician burnout, increase member costs, and penalize hospitals unfairly. As you look to possible solutions, we empi emphasize that consistency, stability, and transparency are all important with the well-being of the patient as the top priority. Thank you.
▶ 0:49:52Thank you, Dr. Jane. You're now
▶ 0:49:58Chairman Buchanan, Chairman Schweiker, Ranking Member Dogget, Ranking Member Su, and members of the subcommittees. Thank you for the opportunity to testify this afternoon. My name is Suchin Jane. I'm a board-certified internal medicine physician and I serve as president and CEO of SCAN. Let me begin with a story, not about me, but about the people who founded SCAN. We affectionately call them the 12 Angry Seniors.
▶ 0:50:26Back in 1977, these older adults were fed up with a fragmented health care system that didn't meet their needs. So they created the Senior Care Action Network, now SCAN, with a mission to help people age with dignity, health, and independence. Nearly 50 years later, that mission still drives us. Today, SCAN serves serves over 300,000 Medicare Advantage members across Arizona, California, Nevada, New Mexico, and Texas.
▶ 0:50:55What sets Scan apart? We are proudly nonprofit. This matters. This means that we can prioritize the long-term well-being of our members over the short-term financial returns that shareholders expect. We serve the people who trust us with their care, not Wall Street. And it's not just words. We've earned a four and a half star rating in seven of the last eight years by investing in what matters most to beneficiaries. Few other plans in the country have achieved this level of high quality and consistency.
▶ 0:51:26I come to you today wearing many hats. I'm a clinician. I'm a former uh CMS official. I'm a health plan leader. And I'm a family member. My mother-in-law and father-in-law are SCAN members. They joined after we got married, not before. I've spent countless hours talking with them and other older adults about what works and what doesn't work in our system. And I keep coming back to the year 1965.
▶ 0:51:53That's when President Lyndon Johnson with Harry Truman looking over signed Medicare into law. declaring that no longer will older Americans be denied the healing miracle of modern medicine. That vision was noble and it literally changed the face of this country. But here's the truth. Traditional Medicare in its original form has important gaps. It doesn't offer dental, vision, and hearing benefits.
▶ 0:52:19It focuses little on prevention and offers scant coordination of services. And importantly, as costs rise, many older adults struggle to access the care that they need. In traditional Medicare, older adults families are on the hook for significant cost sharing, or they can elect up to $1,000 in expenses for part B, part D, and supplemental With seniors carrying an average annual income of about 50,000, that's for a household, and tra the traditional program is out of range for lower
▶ 0:52:50and middle inome older adults. Medicare Advantage helps fill those gaps. It brings care coordination, supplemental benefits, and financial protections that traditional Medicare simply doesn't offer. It dramatically reduces cost sharing with beneficiaries to the tune of thousands of dollars annually, and it aligns incentives to keep people well. Are there problems with the program and need for reform? Absolutely. But let's not miss the forest for the trees.
▶ 0:53:20Let me give you a few real examples of how this vital program helps America's seniors today. An older woman with diabetes and vision loss is able to get to her doctor's appointment only because her plan covers transportation. A man with hypertension has access to a health coach, a dietitian, and remote blood pressure monitoring because under MA, managing chronic disease makes more sense than managing its complications.
▶ 0:53:44A scan member who is discharged from the hospital has all her durable medical equipment and follow-up in place before discharge, not after. Because we know far too many balls drop for patients who can ill afford it. Now, let's be clear. These types of services and benefits are not luxuries as they're often represented. They protect health. They protect independence. And they protect dignity and are all uniquely available because Congress gave plans.
▶ 0:54:11Congress in its wisdom gave plans the flexibility to innovate service and benefit design. If we want to lower long-term costs, we must invest more upstream in prevention, in chronic disease management, and the sort of care coordination that actually keeps people healthy. Too often, we debate Medicare advantage in abstract terms. We talk about payment rates. We talk about benchmarks and coding intensity. Now, the program certainly needs reform of risk adjustment, utilization management, and the STARS program.
▶ 0:54:41But the real test is this. What does life look like for older adults with these plans? And what does it look like without them? For too many older adults, it means the difference between stability and insecurity, prevention and crisis, dignity and decline. We at SCAN are ready to be part of the solution to improve upon a Medicare advantage. We believe in greater transparency. We believe in oversight. We believe in improvement.
▶ 0:55:07And we believe in a future where MA fulfills its promise for every older adult in this country who actually needs it. Again, thank you for the opportunity to be here today. And I look forward to your questions.
▶ 0:55:19Thank you, Dr. Feedler. You are now
▶ 0:55:23Chairs Buchanan and Schwikert, ranking members Dogit and Su, and members of the subcommittees. My name is Matthew Feedler, and I'm a health economist and a senior fellow at the Brookings Institution. I am grateful to be here to discuss the present and future of Medicare Advantage. I want to begin with a striking fact that has already been mentioned. Covering a Medicare beneficiary under Medicare Advantage costs an estimated 20% more than covering the same person under traditional Medicare. That differential will generate about $84 billion in additional payments to MA plans this year.
▶ 0:55:53This additional cost is borne mostly by taxpayers, but around 15% or roughly $13 billion is financed through higher Medicare PartB premiums. Notably, those higher premiums are paid by all part B beneficiaries, not just those who opt to enroll in MA. MA plans are paid more because of problems with the program's risk adjustment system. Risk adjustment aims to align payments to plans with enrolles healthare needs uh as predicted by their health conditions and other characteristics.
▶ 0:56:23However, the current system overstates the needs of MA enrolles because plans report more health conditions for their enrolles than would be reported for the same enrolles if they were enrolled in traditional Medicare where the same incentives incentives to record every possible diagnosis does not exist. This makes MA enroles look more costly than they actually are.
▶ 0:56:43MA plans also attract beneficiaries who on average need less care than the risk adjustment model predicts, a phenomenon called favorable Research shows that paying an MA plan an additional dollar delivers much less than a dollar of value to enrolles. When policymakers make the MA payment system more generous, insurers respond by raising the prices they charge to deliver the basic Medicare benefit.
▶ 0:57:07As a result, only part of the higher payments to plans evidence suggests around 50 cents on the dollar finances extra benefits such as reduced premiums, reduced cost sharing, or coverage for services that Medicare does not cover. It's unclear how insurers use the remaining amount um that is not passed through to beneficiaries, but at least part is likely captured as profits and spent on marketing.
▶ 0:57:30Because a dollar paid to an MA plan delivers much less than a dollar of value to beneficiaries, reforming MA payment offers policymakers a range of potentially appealing opportunities. For example, the savings could finance a substantial increase in the overall generosity of Medicare benefits without a net increase in program costs. They could also be used to reduce the deficit or invest in other priorities. Or policymakers could take a middle path, increase Medicare's generosity to some degree while reserving some of the savings to meet other needs.
▶ 0:58:00If policymakers opted to reform MA payment, a sensible goal would be to align payments to MA plans with the cost of covering comparable enroles under traditional Medicare. Under such a system, beneficiaries would tend to choose MA in cases where MA could offer better coverage at the same cost and remain in traditional Medicare otherwise. This would maximize the quality of coverage beneficiaries received for a given federal outlay. To achieve this goal, the most important step would be to fix the MA program's broken risk adjustment system.
▶ 0:58:30Doing so would require multiple reforms, but one worthwhile step would be for polic for lawmakers to more clearly specify how CMS should calculate the coding intensity adjustment it uses to offset MA plan's more intensive diagnosis coding. This adjustment is currently much too small. Lawmakers could also direct CMS to create a similar adjustment that's aimed at favorable selection. Fully aligning MA payments with traditional Medicare costs would also require various reforms to the program's underlying benchmark formula.
▶ 0:59:00In closing, I want to make one broader point. Congress recently enacted legislation that is expected to cut spending on Medicaid in the marketplaces by around $1 trillion over a decade and to increase the number of uninsured by about 10 million people. Research shows that the people becoming uninsured will experience serious negative consequences, less access to care, reduced financial security, and worse health outcomes, including a greater risk of death.
▶ 0:59:26By contrast, MA reform could save hundreds of billions of dollars over 10 years without increasing un on insurance and while maintaining or increasing the overall generosity of the Medicare program. And MA reform is far from the only option for generating substantial healthcare savings without compromising access to care. In short, sharp increases in uninsurance and sharp reductions in access to care are not a necessary feature of efforts to reduce federal healthcare spending. Thank you again for the opportunity to testify. I look forward to your questions.
▶ 0:59:58Thank you for the testimony. We'll now proceed uh to questions and answers. Uh let me let me just start out and I want to Mr. Dr. uh Jan. Yeah. Is it Jan? Yeah. Uh Jane, let me mention uh the idea you touched on prevention. We're spending $5 trillion as a country. That's the number I get. Two trillion on Medicare and Medicaid. seems like we're getting sicker at large uh and we're spending a lot more money.
▶ 1:00:29It seems like everything's reactive. Instead, you get the heart disease, you get the obesity that then you try to deal with it, but it just seems like it's so much more expensive. Can you expand a little bit more on your idea of prevention because it seems like the business that all of you are in the more you make if you keep the people the folks healthy and we're we're reacting once it happens. As a guy I'll just say one other thing.
▶ 1:00:55As someone that's been in business a long time, one of the most important thing is to get the incentives and the pay plan right. And part of the problem our whole system to me is broken. We keep spending more and getting less for whatever reason. And uh I just like to see us, someone said, you got to be the CEO of your own health. We've got to have people take a little more responsibility or encourage them or help educate them to take more responsibility for their own health. But there's so much misinformation out there.
▶ 1:01:25It's not anybody's fault. But when you have 50 to 60% of the people in the country is obese. They say 30% uh for young men g ladies trying to go in the military obese. They're talking about children at 20% or 18% obese. And that wasn't the way we grew up. So my point is I'm interested in in your thought initially uh you know where where are we at on this?
▶ 1:01:50Because I I don't if we don't change that paradigm I don't see how we get ever where we're going. We'll never have enough money. Five trillion we're spending now. how much more you how much more we got to spend for what we're
▶ 1:02:02Well, thank you so much for the question. Um, you know, I think about this question really in very personal terms. Uh, my father was diagnosed with diabetes in 1985. The first time that a physician or a medical student in this case, the medical student was me um referred him to a dietician was in the year uh 2006.
▶ 1:02:24And the reality is that um we have a medical system right now that treats people when they become sick but does very little to actually prevent them from becoming sick in the first place.
▶ 1:02:36We will pay for uh expensive procedures on people's retinas. We'll pay for their dialysis. We'll pay for their cardiovascular interventions. But had we actually intervened on my father who passed a couple of years ago um in the 80s and 90s with lifestyle interventions um with a more intensive focus on actually counseling him on his disease um for pennies on the dollar um he might still be here today. Uh that's the kind of thing that we try to do at scan for our Medicare beneficiaries.
▶ 1:03:05We try to think about their chronic diseases, intervene upon them early, get them the kind of supplemental benefits that they need to keep them healthy and well. Um, I think there's incredible opportunities for us to intervene upon people and prevent things. 65, however, is too late.
▶ 1:03:21Um, when I meet our Medicare beneficiaries, they've had 65 years in a fee for service system where they've largely been disconnected from primary care or if they have primary care, we're focusing on treating their problems when they actually arise as opposed to actually slowing or delaying their pro progression or preventing them from happening in the first place. I think we have incredible opportunities through the Medicare Advantage program.
▶ 1:03:46The whole thing on obesity has become such a big issue, especially when I think I got 10 grandkids 10 and under, and I'm very concerned about what they're eating or what they're doing. Uh they don't have any of those issues now, but any kids, I don't like to see what's going on that space. Dr. Miller, let me ask you, uh what's your thought on provincial? What more can we do? Is our system backward? we're reacting to the problem.
▶ 1:04:13It cost a lot more to react when stage four cancer or something than trying to prevent it in the first place. And uh so that's just my the way I look at it. The way I want to run my life is that way. Someone said the first time you have the first heart attack, when you have your first heart, someone has a first heart attack, half of them never see the next day. So I thought to myself 20 years ago, how do I not prevent that to begin with? So I get back to the whole idea of prevention. So, thank you for the question.
▶ 1:04:42I think part of this gets around to how we can customize benefits rather than standardize benefits. We have special needs plans or SNIP plans. They're for beneficiaries who live in skilled nursing facilities. We have uh DNIPS for dual eligibles who are eligible for Medicare and Medicaid. And then we have CNIPS for chronic disease.
▶ 1:05:03So I I think actually CMS needs to invest some time and energy working to promote this marketplace so we can have customized health benefits to address chronic disease to address those who are multimorbid and live in a skilled nursing facility and also dual eligibles. We could have specialized benefits, specialized marketing, advertising regulations, and then of course customized network adequacy. So that way we can get the right patient into the right health benefits package and get the right care.
▶ 1:05:34But is it your thought thought should it be is a system in your mind reactive or should it be proactive and try to not let people get in the situation in the first place? Some of it's hereditary. I'll take that. But there's a high percentage. It's got to be the what the environment, the food or something that we're lack of activity. There's something going on in my mind.
▶ 1:05:55I agree wholeheartedly. Mr. Dogget, you're recognized.
▶ 1:06:01Uh, thank you very much, Mr. Chairman. Uh, you know, while the MA ads that are direct to consumer to seek new enroles are usually misleading, the Medicare Advantage ads that are resisting reform are truly deceptive. A good example are those that are being run now over a million dollars worth in the state of Louisiana against its senator uh Republican Senator Dr.
▶ 1:06:23Cassidy claiming that his efforts to end up coding represent deep Medicare cuts for the people of Louisiana that will deny access to their doctors. Uh Dr. Dr. Feedler, can you explain why reigning in waste, fraud, and abuse in Medicare Advantage can actually benefit all enroles, including even those that are in MA plans, without in any way jeopardizing access to their health care, as these false ads have been claiming against Senator Cassidy?
▶ 1:06:55Uh, as you mentioned, uh, we're currently paying Medicare Advantage plans tens of billions of dollars more, uh, per year than it would cost to save the, uh, serve the same beneficiaries in traditional Medicare. And so, if policymakers were to rationalize the MA payment system and use those funds to invest in the base Medicare benefit, um, that approach would obviously benefit traditional Medicare enrolles, but reinvesting the savings in those ways could benefit Medicare Advantage enrolles as well.
▶ 1:07:23uh because MA plans are required to cover the base Medicare benefit because traditional Medicare is is the competition for MA plans and because those higher benefits would translate into higher benchmarks for MA plans and because the MA plan is so ineffic MA status quo is so inefficient depending on the circumstances and the design of that type of policy even MA MA enrolles could end up better off on that than they are under the status quo. Well, thank you very much.
▶ 1:07:48And I'm sorry to say I hear the same kind of false ads are being run against Chairman Schwackard out in Arizona that have been used in Louisiana and elsewhere uh when we could be working together to try to get the taxpayers more for their investment. Let me ask you to turn to the whole issue of risk adjustment because after being promoted as a way to save taxpayer money and improve quality, we're still waiting to get the first cost benefits uh from Medicare Advantage.
▶ 1:08:16and in fact has spent billions more than traditional Medicare. Uh I have repeatedly urged CMS to rein in uh the abuse of uh upgrading uh the very one that they're running these ads against people who who raise that question. What are the benefits of adopting some new risk adjustment formula such as I believe it's called DESIE that has been recommended by MedPAC? How would it impact good actors that don't engage in up coding?
▶ 1:08:46So I think the evidence is quite clear that CMS existing method CMS's existing methods for adjusting for higher coding intensity in Medicare Advantage are are seriously inadequate and that that's a big reason why payments to MA plans have ended up so much higher than intended.
▶ 1:09:01um if CMS were to adopt a better method for adjusting for coding intensity and I think um medex uh uh and the research community's death method could be um the foundation of a method for doing so that that would help mitigate this type of problem. Um I think that method could be used um in one of two ways. It could be used to calculate insurer specific adjustments or it could be used to calculate adjustments at the market level.
▶ 1:09:28Um I think the advantage of insurer specific adjustments is that it would only adjust coding intensity to the extent that a particular insurer plan is adjust uh is engaged um in more intensive coding activity. Um I think a caveat with an insurer specific approach is it could expand the scope for PL plans to engage in favorable selection. So I think there are trade-offs with these types of approaches.
▶ 1:09:50Finally, I'd ask you to turn to supplemental benefits. You know, when when the uh enrollment period begins and we start seeing one ad after another on television, you get the impression you get free rent, free visits, free groceries, perhaps even a free autograph football from Joe Mayoth. Uh but uh in fact, uh there are some limits on supplemental benefits.
▶ 1:10:12And I wonder if you could could tell us a little more about uh your just expand on your testimony concerning whether Medicare Advantage plans are adding significant value through these supplemental benefits, a number of which when they relate, for example, to dental service are the very type that some of us have been trying to get added to uh traditional Medicare.
▶ 1:10:35So I think the reality is when we're talking about particularly dental services um the coverage that MA plans are actually offering is often much more limited um than you know what people think expect to be covered under a dental plan in terms of either what services are covered or or or what the financial limits on the coverage are.
▶ 1:10:55um you know there are MA plans do offer um additional uh cost sharing protections and some in some cases lower premiums but I think the the issue from my perspective is those additional benefit benefits aren't commensurate with the additional money we are paying those plans and so there are probably much better ways to deliver those additional benefits to Medicare beneficiaries than the sort of bank shot through higher MA payments that we're uh working with
▶ 1:11:20Thank you. Thank you, Mr. Chairman.
▶ 1:11:22Thank you. I now recognize Chairman Smith for questions.
▶ 1:11:26Thank you, Chairman Buchanan. When 54% of Medicare beneficiaries are choosing a Medicare Advantage plan, there is clearly a strong and growing interest by seniors to have access to MA and the benefits that come with it like lower out-of-pocket cost, access to supplemental benefits such as prescription drug coverage and transportation services, as well as specialized plans tailored to patients with chronic conditions.
▶ 1:11:56Patient enthusiasm for the program is exactly it's exactly why we should ensure its integrity. For example, we know of concerns about MA plans inflating a patients level of sickness resulting in higher reimbursements for the plan at taxpayer expense and an estimated 40 billion in 2025 alone.
▶ 1:12:26Miss Moroni, how rampant of an issue is this and what can Congress do to help support the Trump administration protecting this program so treatment is giving given where it is needed?
▶ 1:12:43Excellent question. um you know trans full transparency making sure that organizations if there is abuse that's going on at an individual organizational level that that organization is being held accountable. Um you know seniors in today's environment they utilize these programs because they are of value.
▶ 1:13:03there's an additional $200 per member per month in benefits that are available and accessible to these individuals, which equates to close to $2,500 or $2,400 a year. Uh, and then when you think about if they had to go on Medicare fee for service on its own and they're selecting a fee for service program, then that program is anywhere from $200 to $300 per member uh per month in addition to just to get the full comprehension of the the program as a whole.
▶ 1:13:32I do believe that the re there is reform that is required. There's opportunity. There's opportunity for us all to sit at the table and to come up with a collaborative dialogue to make sure that how do we have full transparency and perfection to improve the program but not take away from the program and to make sure that the individuals that I've talked about that they're still getting the value of that benefit on a monthly basis.
▶ 1:13:56in addition not having to pay hundreds of dollars of premiums when many individuals who are enrolled in these programs are on very fixed incomes. Thank you.
▶ 1:14:07So one of the well-known benefits of engaging the private sector is the faster pace of innovation which in the case of health care means a system that can respond more quickly to the needs of patients and providers. My number one priority when it comes to healthc care reform is expanding access to higher quality care in rural communities. Um Dr.
▶ 1:14:33Basel, we have seen rapid growth of MA in rural areas in recent years. What are some of the main lessons you've learned from your experience serving rural communities? and how should MA incorporate those lessons to enhance access and deliver better health outcomes for rural patients.
▶ 1:14:56Thank you, So, one of the potential uh benefits of being an MA plan is that innovation and that flexibility to be able to respond to the needs especially in our rural areas, our community health needs assessments that the hospitals do every couple of years. Transportation is a good example of something that comes up in the top two or three needs in those assessments in every one of our communities, especially in our rural areas. You know, there are not such things as ride sharing programs or even taxi services.
▶ 1:15:26And a lot of times, um, our hospitals are where that ends up taking on both the medical transportation, but even the non-medical transportation. and getting someone to social activities, loneliness, social isolation is one of the biggest predictors of adverse uh health in the elderly. And so that's a good example of where where it's worth it to us, you know, to look at that transportation and to bear some of the cost of developing those programs even though that's not a traditional healthcare expense.
▶ 1:15:53And so it's that type of innovation that the promise of MA hopefully can deliver on.
▶ 1:15:58Thank you. In addition to the upcoding issues we have heard about the MA plans excessive preapprovals can get in the way of timely care for patients and layer on additional paperwork for providers in in our rural communities. 80% of providers say utilization management creates administrative burdens. Dr.
▶ 1:16:23Miller, can you shed some light on how practices like excessive prior authorization have become a growing problem and what can be done to improve care for patients and reduce burdens on providers while still maintaining the goal of a more efficient lowercost health care system?
▶ 1:16:44I think everyone has a stake in this one. First of all, it should be oneclick submission of data in the electronic health record. The patient seeing you, you shouldn't get a request weeks or months later. It should be real time. You submit your data. It automatically ports labs, notes, imaging studies. You should be able to access what the medical criteria are. For prescript outpatient prescription drugs, for example, you should what know whether it's nonformulary, tier 1, tier 2, tier three.
▶ 1:17:13So pushing that information to the point of care is something that CMS and plans can do together. I think on the provider side, we need to improve our documentation enormously. So a lot of denials are because you don't have the right information. You don't have the member number, you don't have the date of birth. The note is copy forwarded for every single day of the 24-day hospitalization and says the exact same thing with no addition. No additions.
▶ 1:17:41a lot of tools that we can do to support doctors and hospitals with documentation, the ambient AI scribes, the voice dictation. I think a lot of those things that will happen over the next 5 years from both the hospital industry, the plant industry and CMS as a regulator can actually solve a lot of these problems. It's very fixible.
▶ 1:18:00Thank you. Thank you, Chairman Buchanan. Chairman Schweer, I yield back.
▶ 1:18:04I now recognize Miss Sul for five
▶ 1:18:07Thank you, Mr. Chairman. I want to thank all of you for being here today. For me, um, where I represent both an urban area, Birmingham, Alabama, underserved, um, and a huge swath is rural. And picking up where my chairman just left, uh, Chairman Smith just left, prior authorization is the number one complaint I hear about. The number one.
▶ 1:18:32and the delays in payment have exacerbated an already financially insecure uh hospitals. I represent Alabama that did not expand Medicaid. My rural hospitals are teetering on the edge. And when I hear um time and time again about pre-authorization, it almost I mean it's just it's mindboggling that the denial rate is so high. And I know Miss you actually said that your denial rate was just 2%.
▶ 1:19:02So, can you enlighten me as to how you were able to get your uh denial rates lower?
▶ 1:19:09Thank you so much for that question. Um, and we take pride in that. Um, you know, there are a lot of uh referrals that people go through that should be auto approved. There should be no hold time. and approximately probably about 97 5 to 97% of uh prior offs that come through the system are automatically approved at alignment. The other thing is is which um I heard a little bit earlier about the prevention um and component and which is critical.
▶ 1:19:36We have a belief system through our jump start assessment program for every new enrolly that enrolls into the program. It is our goal to see them immediately within the first 90 days or 120 days to make sure that there's a no continuity of care issues.
▶ 1:19:50So, it sounds like you are trying to to uh on the front end prevent chronic diseases and in doing so you're saving money and obviously saving people's lives as well. Absolutely. Um, one of my hospitals, DA, uh, DCH Regional Medical Center in Tuscaloosa, has consistently experienced an increased disparity in the performance of MA plans compared to traditional Medicare. Um, stemming from pre-authorizations, inconsistent payer communication, unpredictable claim denials.
▶ 1:20:20The average number of days it takes to receive reimbursement for services from traditional uh, Medicare for DCH, this particular hospital, is about 18 days. So, traditional Medicare 18 days, but for MA plans, the same hospital has to wait anywhere from 21 to 66 days for a pre-authorization.
▶ 1:20:42Now, I know the Biden administration uh did um did much needed reform uh on pre-authorization, but it didn't go, in my opinion, far enough. Uh and so um the the leadership of DCH wrote to me explaining an instance where a team member spent nearly an hour trying to obtain a prior authorization for an impatient admission despite successfully obtaining the approval.
▶ 1:21:08The claim was later denied for quote no authorization on file end quote. This led to a full appeal uh which included resubmitting data and followup uh you know multiple follow-ups all to eventually get the original authorization honored.
▶ 1:21:28We cannot afford to have this kind of I insanity for lack of a better word and and think that we can actually fix our very frail health care system. Um and so Dr. Dr. Basel, I wanted to know from you um how can you know and let me let me just back up and now I hear that AI may be replacing people live people on the other end of these pre-authorizations only complicating matters.
▶ 1:21:56So what can I give what assurances can I give to my constituents especially in rural parts of my district that MA reform is likely to happen and continue to happen and that it won't restrict access.
▶ 1:22:11Right. So your data actually is very similar to what we see. We see about 20 days on average for accounts receivable for traditional Medicare and considerably longer for MA. And so that is consistent with our experience with the MA plans as well. You mentioned AI and so that is something that AI could be a good thing because if it helps increase the speed to where you can get a prior authorization approved because it automatically you know kind of gold cards you or something like that AI could be a very good thing.
▶ 1:22:40Yeah. It also it depends upon how what algorithms you feed into it. So if you are if your first instinct as an is as an insurer is to deny deny deny deny then an AI wouldn't necessarily benefit that right and I know I'm I'm running out of time and I did want to ask Mr. um uh Fedler Feedler, sorry. Um if you could um also uh expound upon what you were saying about rural hospitals um and and and MA you I know. Yeah.
▶ 1:23:11In particular, you were u the the the large number of uh rates of um denials for MA. Um so I mean certainly to the extent that hospitals are experiencing higher denial rates um uh in MA that has implications for their bottom lines. You know some hospitals are going to be able to absorb that some hospitals are not and it's going to sort of depend on well you know what's the what's the financial condition at baseline.
▶ 1:23:35Yeah. Thank you Mr. Chairman. I I'm sorry to extend my time but I think that it's really important that we get to the 20% more costs for M for a medical uh Medicare advantage over traditional Medicare. That's $83 billion dollars worth of
▶ 1:23:49Let's get together on that.
▶ 1:23:50So, let's work on that. Thank you, sir.
▶ 1:23:52Pursuant to committee practice, we now move two to one questioning. I recognize Mr. Smith, Nebraska.
▶ 1:23:59Thank you, Mr. Chairman. Thank you to our entire panel for uh participating in what I think is a very timely discussion, something that uh I think should be on all of our minds. and looking at, you know, Medicare Advantage has been around for some time now and I think we have a lot of data to draw on.
▶ 1:24:17I think hearing from seniors, many of whom appreciate being on a Medicare advantage, I think we ought to uh pay attention to that, but also uh look look a little deeper than that and make sure that we are formulating policy uh that is is good for seniors, good for their health care, and certainly good for our our country. And so I think there's some things we can take away.
▶ 1:24:42The flexibility and and creativity, if you will, that some plans offer that actually contribute to better health that as Ms. was speaking about. I think we need to be mindful of that. I represent one of the most rural districts in in a very rural state and so there's not as much participation as you know, not as many options that uh would exist for patients across my district.
▶ 1:25:10And I I want to make sure that seniors have have the choices that can lead to higher quality outcomes and and saving uh cost savings uh as well. Um I I hear from providers that they're concerned about additional paperwork. Uh that leads to cost obviously.
▶ 1:25:29Um now in all honesty there are a lot of some providers who are saying they don't want to participate at all and that's that uh should get our attention in a hurry and and when the the beauty of the system should be a a plan in discussion with providers can come up with a good solve for patients that's what we want and so when when perhaps a provider feels shut out I I think that that should
▶ 1:25:59be addressed. But Dr. Bosle, I uh certainly appreciate the services that are offered by a Vera in my district and I know that a Vera is involved both on the hospital side and the in the MA uh plan equation. I I know you're very familiar. And how would you say a Vera has operated differently than other MA plans in order to succeed in rural areas where other plans have actually encountered Thank you, Representative Smith.
▶ 1:26:28And you know, earlier I talked about, you know, the transportation issues in many of our rural areas. You know, one of the facilities in your areas in O'Neal, Nebraska is one of those places where we've worked with coming up with a transportation system of our own. But in general, you know, prevention we talked about is one of the key things that certainly plays into here. But coordination of care is the other thing.
▶ 1:26:48And that's where I think a Vera has an advantage being both a health care system as well as the payer there because we can do that care coordination, reduce that fragmentation of care and then shift towards the prevention side. And so, you know, it's all about that alignment of in incentives. You talked earlier about why don't we do more prevention and it's about that alignment and that time horizon. You know, prevention is going to save us money 10 years, 20 years down the road.
▶ 1:27:14And so how do you get to the shortterm things so that you can reinvest it in that prevention that's going to save you money on down the
▶ 1:27:21Okay. Where could you say CMS could take steps to ensure that rural seniors continue to have access to high quality MA options? So you you think about network sufficiency is one of our biggest problems in getting access to MA plans certainly in a lot of your uh constituents because they're so rural at being able to get specialty care within the guidelines and so that's something that you've worked on in the past to to you know network network adequacy problems that continues to be something
▶ 1:27:51that we look to partner with you know some of the changes in tele medicine to allow us to do a little bit more in those those areas but also it gets to some of those coding intensity changes this too. That's a have and have nots. And so if you've got certain MA plans that are very aggressive about coding intensity, you know, ones like us that take more of a clinical approach to if you're not managing that disease clinically, then it shouldn't be, you know, on that chart.
▶ 1:28:18You know, we get hurt by those across the board coding in intensity reductions. And so trying to go after only those that have the more aggressive tendencies as as opposed to putting across the board reductions would be very helpful to smaller plans like ours.
▶ 1:28:33Okay. All right. Well, I I appreciate your perspective and certainly it's been mentioned already what some of the good parts are, what the what the challenges are. I'm very concerned about straight up fraud that takes place that I would hope we have the tools necessary to to address that. uh realizing there's some good parts of this that we don't want to lose uh as we um sort things out. So, thank you, Mr. Chair. I yield back.
▶ 1:28:59I now recognize Mrs. Fishbach.
▶ 1:29:01Thank you, Mr. Chair. And uh and I like Mr. Smith. Um I serve a very rural area. Dr. Basil, thank you so much for being here today and um for your work with a Vera Health um which serves so many of my constituents across the seventh district. And if you're not familiar with it, I am the western half of Minnesota. So I border Canada, North Dakota, South Dakota. So there are a lot of A Vera facilities in my district and uh um and I appreciate that Mr.
▶ 1:29:31Smith from Missouri um you know had brought up some of the rural issues, the rural patients and some of the other folks have too. Um but given your your unique perspective overseeing um the regional Medicare advantage plan and the clinical operations across the 38 rural hospitals. Um I'm wondering on how prior prior authorization policies specifically affect rural areas, the rural discharge planning.
▶ 1:30:00Um and I mean we've seen data showing that MA enrolles face longer hospital stays and I think you mentioned maybe some of that during some of your testimony um due to delays and in to approve the postacute care. Can you speak to some of these how these delays affect patient flow and hospital capacity in your rural facilities in
▶ 1:30:22Yeah, so the main issue here is going to be prior authorization delays for skilled nursing care. A lot of our rural areas, we actually utilize skilled nursing care a little bit higher. When you live 45 miles away from the nearest hospital, you're more likely to send somebody to the skilled facility than you are if you live 2 miles away from the the hospital. And so those delays in getting people out of the hospital and into that convolescent mode, it affects direct patient care. Hospital is no place to rest.
▶ 1:30:51You know, it's no place to regain your strength. And so getting them to that next level of care is important. So that's one piece of that directly affects the patient. The other care is it clogs up the hospital systems. And so we've got beds that we can't put another patient in, especially, you know, if it's in our tertiary care center, they're usually running at capacity and we have to get one patient out before we can transfer in that patient from the rural hospital for the needed higher intensity of care. And then the cost piece of it as well. It's like if they're spending more days in the hospital, they're costing us considerably more.
▶ 1:31:22and and can you maybe speak to or if if recent federal efforts to streamline any of that uh at that prior authorization has made any kind of meaningful difference on the ground.
▶ 1:31:34So obviously I I can't tell you what it would have been like without any of those changes, but I can tell you the trend. We have not seen any bend in the curve. In fact, if anything, there's an escalation in the number of denials and and delays that we're seeing yearbyear. So we've certainly not seen any appreciable effect that I can tell.
▶ 1:31:50Okay. Thank you. Um the other thing and um I I'm going to shorten this up because we're short in time, but from from your perspective um which of the which of the supplemental benefits because you mentioned earlier not transportation those kinds of things and and I just want to tell you the transportation is a huge issue. I mean when you look at my my district and across rural areas and I just want to um just add um is you know transportation is an acute issue.
▶ 1:32:18I've seen I've seen wives not accompany their husband in the ambulance because they don't know how they're going to get home. Yep.
▶ 1:32:24And and that's and I know that we can't necessarily cover it, but it is part of people's care that they have their loved ones with them. And that's that was heartbreaking for me when I But um which of the supplemental benefits um have proven most impactful in those rural bene uh in those rural areas? So if you look at some of the ones like I would like to be able to say that it's some of the uh health club benefits and stuff like that because that should lead to more exercise which should improve health.
▶ 1:32:54Unfortunately, I think those are underutilized by all aspects of our society. And so, I don't know that I can say that probably some of the dental and vision plans are what you see most broadly and makes it feel a little bit more like commercial insurance that people are are used to. And certainly dental health is tied to medical health. And so, that would certainly be one of those that I would point to.
▶ 1:33:15And and again, thank you for being here. I appreciate the perspective um given that you know healthcare in my district very well. And so, I appreciate you being here. So, thank you.
▶ 1:33:24Thank you. And I yield back.
▶ 1:33:26I now I now recognize Mr. Thompson.
▶ 1:33:28Thank you, Mr. Chairman, and thank you to the witnesses for being here today. Well, Medicare uh advantage provides important benefits to some 54% of our nation's seniors. However, as as has been pointed out, Medicare Advantage is not without its flaws, and those flaws need to be fixed. Reports of upcoding in Medicare Advantage raised concerns that patients are being given elevated diagnosis but little to no additional care.
▶ 1:33:56There concerns that Medicare Advantage companies are limiting patient access to care by using prior authorization far more than traditional uh Medicare. Mr. Chairman, I ask unanimous consent to submit this Wall Street Journal uh article in the record that highlights this. And I also ask unanimous consent to submit this California Hospital Association study on the effects and cost of prior authorizations.
▶ 1:34:26For the record, uh thank you. Uh the study shows that prior authorization delays uh uh contribute to at least three and a4 billion dollars in avoidable cost every year. And that's just in California. actions uh like these support the need to increase transparency and reporting uh around the Medicare Advantage program. However, Mr.
▶ 1:34:51Chairman, we can't discuss improving health care without addressing the 500 pound elephant that's in the room today. Access to care is going to worsen because of the Republicans big ugly bill, now the big ugly law. Congressional Republicans just passed a $1.5 trillion dollar cut to health care.
▶ 1:35:14Congressional Republicans cut a trillion dollars from Medicaid, cut 500 billion from Medicare, and failed to extend the enhanced premium tax credits that make insurance affordable for middle class Americans. All by adding while adding over $4 trillion to our national debt. Mr.
▶ 1:35:36Chairman, I ask unanimous consent to submit this committee um uh for the responsible federal budget report about the cost of the big ugly law. For the
▶ 1:35:4715 million patients will lose their health care coverage. At best, hospitals uh will reduce services that they offer in order to stay open. At worst, hospitals and clinics will close. I've heard from seniors in my district that they're worried that they will lose their Medicaid coverage, which contributes to their Medicare cost share. They're terrified that their health care cost will increase and that they will go bankrupt just trying to get the health care that they need.
▶ 1:36:16All because of the Republicans on this committee and in this House pass that big ugly law. It doesn't matter if you have Medicaid, private insurance, or all the money in the world to pay for your care. If your local hospital is closed or had to fire the surgeon who performs the procedure that you might need, you won't get the care that you need. Congressional Republicans also hamstrung the student loan uh access for future doctors.
▶ 1:36:47That's going to make it more difficult uh to have health care, especially for those of us in rural areas. And the attack on health care uh doesn't stop there. The administration wants to slash research funding. Mr. Chairman, I ask unanimous consent to submit this CBO analysis showing that NIH funding cuts and FDA staffing cuts would result in about two fewer drugs coming to market every year.
▶ 1:37:17Without objection, Mr. Chairman.
▶ 1:37:19Yeah, without objection.
▶ 1:37:20Thank you. However, this analysis is based on a 10% cut is low estimate because the Trump administration has proposed a 35% cut in NIH funding.
▶ 1:37:33CBO said that the administration's proposed cuts to medical research, medical research is so large that they haven't even been able to determine whether historical evidence can be generalized and reliable uh to use reliably used to estimate the effects. Mr. Fielder, we're supposedly here to talk about Medicare advantage to distract from the devastating cuts to patient care because of this big ugly law.
▶ 1:38:01Can you explain some of the challenges that Medicare advantage patients might face in getting the care they need due to the Republicans cut on Medicare, Medicaid and the ACA
▶ 1:38:13propagandizing from our side.
▶ 1:38:14So I think with respect to Medicare beneficiaries, one of the most important impacts and it flew a little bit below the radar but is the challenges that Medicare beneficiaries are going to be facing in signing up for the portions of Medicaid that helps with premiums um and cost sharing. Um, so you know, one of the things uh that had happened during the Biden administration was they made a set of changes to automatically enroll some people who are clearly eligible based on the information the federal government already holds into those medic so-called Medicare savings programs.
▶ 1:38:45Um, under the bill uh that will no longer go forward and those people will have more difficulty enrolling in uh paying their Medicare premiums and and paying for care they
▶ 1:38:54So less access to care for Americans. Thank you very much. I yield back.
▶ 1:38:59I now recognize Mr. Kelly.
▶ 1:39:02Thank you, Mr. Chairman, and thank you all for being here today. I I want to go back to not so much the uh the political back and forth on it. I want to talk about the model that's in that's in uh in operation right now. So, uh look at the district that I'm in has one of the highest Medicare Advantage usages in the country and and we've long been a supporter of the program. However, the program has become increasingly costly and complicated for seniors.
▶ 1:39:28constituents have described to me the countless stories of waiting weeks for approval for treatments that their doctors say they need us immediately. Now, the reason I want to bring it up as a as a business is is in the automobile business I'm in, we go through the same thing with warranty on both uh repair work and and uh warranty work and you wait and wait and wait for the authorization that whoever it is that bought that automobile brings it in for have work done on it and you're waiting for somebody from the factory to go ahead and approve the work that needs to be done.
▶ 1:39:57We know what the work is that needs to be done, but we have to wait for the approval from somebody else to say, "Okay, go ahead and honor the warranty. Uh go ahead and honor uh the the program that these folks have bought for the after the warranty runs out." And but you wait and wait and wait for authorization. So, I mean, a lot of people say, "Don't compare this to cars and trucks." Uh I'm talking about the ability to get up and do whatever you need to do every day and function.
▶ 1:40:23And if you're work waiting for authorization to do something the technician knows needs to be done right now, that's a problem. That's a huge problem. So, uh, Mr. Albany and I are working on a piece and, uh, uh, it's it's incredible because right now we have 220 co-sponsors on this. This is on both sides of the aisle. We all recognize that there's a problem. Uh, and so what I want to, I want to get, you're the texts.
▶ 1:40:49You're the people that are waiting on I'm a guy who's a dealer who I have threequarters of a million people relying on me to get them answers to whatever they think they have coming and say, "You know what? Get something done. Get this fixed." So rather than take turns bashing about who's in the office at the same at this time and and who's do who's not doing their job, uh just what could we do to make it easier? Dr. Bos, if you would if you would uh expand on this a little bit because that's where I find out where the problem is.
▶ 1:41:18you shouldn't have to wait for things you already have coverage for.
▶ 1:41:23Yeah. So, a lot of this is streamlining the process and so there's a lot of lot of proposals out there right now trying to increase electronically streamlining it, which is certainly would be welcome. I can even give you examples that I was asked informally beforehand, you know, are you against faxing in records or stuff? We've got payers that I would love to be 1970s era faxing things in because we have to call them up and verbally dictate the history and physical allowed into the phone to get it into the record right now.
▶ 1:41:53And so there's a lot of work from an efficiency standpoint. The other side of that is figuring out, you know, what are the appropriate ones that should be flagged. If we're overturning more than 70% of the denials, then there's a lot of unnecessary administrative overhead that goes into that and there's got to be a better way of doing that.
▶ 1:42:11So, and Dr. Miller, you talk pretty much about the same thing, right? So, codifications is a huge problem in anybody that runs any business where you have to file a claim. Uh, in our case, you may have the wrong serial number, you may have the wrong operation number, you may have the wrong flat rate number that you're supposed to be charging to fix whatever it is that needs to be fixed. Uh this is a huge problem and anybody and I'm talking now just as a business, okay? And I hear all this different things about who struck John. Here's the problem. Here's the problem.
▶ 1:42:38It takes so much effort to put the right information in to get the approval on it. Things unnecessarily get held up in my business. People are still making payment on our car or truck that they can't drive because we can't get authorization to go ahead do do the warranty work in their car. This has become too complicated. And then there's the number of mistakes that are made it very difficult. I mean part of what we call uh unproductive labor are the people that fill out all these forms that we get authorization for or get payment for.
▶ 1:43:07You face the same problem. We'd say this is an operational problem that the managed care industry needs to get behind and fixing and it needs to fix it in conjunction with the hospital industry with doctors and the electronic health records. My iPhone has autocorrect. It automatically summarizes iMes. I could set up, you know, automatic deductions from my bank account. We could, you know, invest in my retirement account here from my phone. All these things can be done in an automated simple fashion.
▶ 1:43:36We just need to implement those electronic tools and automation of process in care delivery. So that's something hospitals and doctors and plans need to sit down together and do it.
▶ 1:43:48Well, listen, I want to thank you all for being here today. It is a business model at the end of the day. I know we're talking about people's health. That's critical.
▶ 1:43:56But these things are all fixable with what we have available today to do this stuff. We just need to implement it and put into effect. Thank you so much for being here today. You guys are incredible. Thank you.
▶ 1:44:06I now recognize Mr. Yak.
▶ 1:44:09Thank you, Mr. Chairman, for holding this hearing today and for our witnesses for being here today on such an important topic. Ensuring our seniors have access to quality health care is an important issue to the Hoosiers and the seniors that I represent. Medicare Advantage, also known as MA, has been a strong success for America's seniors, as we've seen substantial growth in the program over the last two decades.
▶ 1:44:31In 2007, 19% of Medicare beneficiaries chose MA plans, and now that's up to MA enrolles tend to have better outcomes when compared to their peers on traditional Medicare. Most notably, they have 70% fewer hospital readmissions and 25% fewer inpatient stays. But no matter how successful a program is, I think in order to be good stewards of taxpayer dollars, we must continually look to make programs more effective and more efficient.
▶ 1:45:01I think it's equally important that we keep all stakeholders engaged at the discussion table, especially seniors and healthcare providers. As we strive for program improvement, I regularly hear from healthcare providers in my district that they struggle with the administrative burdens associated with Medicare Advantage, in particular about prior authorizations when a provider must receive authorization from an insurance company before service may be administrated. I certainly join my colleagues on both sides of the aisle today with concerns about excessive prior authorizations.
▶ 1:45:33Mr. Dr. Basel, can you talk about the impact prior authorizations have on health care providers and the seniors they seek to serve?
▶ 1:45:41So, it's all about where is that sweet spot because there is a a very good case to be made for managing care. So, you don't want no no floodgate to be in there. So, let's say a patient comes in with abdominal pain and I don't think there's any concerning symptoms. I think that they're going to get better in a couple days, but they're really worried and they want a CT. You know, if there's no care, then that the path of least resistance might be sure, fine. You can have a CT.
▶ 1:46:07But if there's a little bit of prior authorization there that enables the conversation about, you know, I just know that the payer is not going to approve this. Let's wait a couple days, see how things go. Maybe start with a plane film. We actually have a better clinical outcome. We're not exposing the patient to radiation. And there's actually better care in that situation. And so, there is a sweet spot there. But it's when that becomes excessive and I've got a patient I am worried about that I can't get that necessary CT for that becomes. And so this is not a black and white white issue.
▶ 1:46:37This is a where in that spectrum is the sweet spot.
▶ 1:46:41Thank you. And uh Mr. Bosley, you spent several years working with rural health care providers. Can you share some of the unique challenges prior authorizations pose in these rural communities? probably one of the biggest challenges in our rural communities, you know, in my big tertiary care center, you know, I've got a whole fleet of people that I train up on this and they get really good at prior authorizations and denials and peer-to-peers and all of this and and they become experts in this in my rural settings.
▶ 1:47:07You know, my director of nursing is also the quality director is also the HR director. Everybody wears multiple hats in these smaller hospitals and they can't be an expert in authorizations and denials and stuff too and and so we face an uphill battle. We try to support them as much centrally as we can, but it's a whole different ballgame when when you can't do this all day every day like some of our larger facilities do.
▶ 1:47:29And what do you see as some of the biggest opportunities to improve the prior authorization process?
▶ 1:47:35Streamline it. I mean, again, there's tools out there that there's no reason that, you know, 70% of these are getting overturned on denial. They should be able to tell which one of these ahead of time are going to make it make it through. And if it's a dotting the eye or crossing the tea things, that should be able to get caught, you know, through some of the technology tools that we
▶ 1:47:54Thank you, Mr. Bosle. And Mr. Chairman, with that, I yield back.
▶ 1:47:58Thank you. I now recognize Miss Chu. It was uh just less than three weeks ago that uh President Trump and Republicans passed the single largest roll back of healthcare in our country's history in the big ugly bill. $500 billion in Medicare cuts, $ 1.5 trillion in total health care cuts, the largest cut to Medicaid ever, and a $5 trillion deficit increase.
▶ 1:48:25All disguised as an effort to root out waste, fraud, and abuse. The result, more than 15 million Americans will lose their health coverage. And some of those people won't lose coverage because they made too much money or no longer qualify. They'll lose it because they missed a paperwork deadline. That's the truth behind Medicaid paperwork requirements. Medicaid is not a cash assistance program. It's health insurance.
▶ 1:48:55No one is getting a check in the mail. They're getting a doctor's visit, a prescription filled, or help paying for a nursing home stay. So, when Republicans claim they're going after fraud, what they're really doing is kicking people off coverage for failing to navigate red tape and freeing up money to pay for tax cuts for billionaires. And meanwhile, there is real waste, fraud, and abuse happening in Medicare Advantage.
▶ 1:49:25Um, we've seen rampant up coding that is submitting higher uh reimbursements for codes than the services actually received. We see inflated risk scores of enroles. We see opaque AI systems denying medically necessary care and a complete lack of GAO, HHS, OIG, and MedPAC have all raised the alarm bells. So, Dr.
▶ 1:49:51Feedler, I'd like to ask you, can you explain why Medicaid work requirements don't actually detect fraud and how, by contrast, Medicare Advantage is raking in billions in improper payments with virtually no accountability? Why should Congress let multi-billion dollar insurers gain the Medicare system while punishing lowincome families who are just trying to stay healthy?
▶ 1:50:19So, thank you for the question. Um, so no, as you said, Medicaid work requirements are not a policy targeted at fraud. Um, they remove eligibility from some low-income adults, for example, someone who's recently lost their job and is looking for work. And then, as you alluded to, they cause many people who are in compliance with the policy. They're working, they're in school, they have a health condition that would exempt them from the policy to lose coverage because they can't document that they fall into one of those categories.
▶ 1:50:43Um, and so, you know, we know that that does save the government money because now fewer people are insured, but that's at the cost of worsening access to care, financial security, and health outcomes for the people who are now uninsured. On the Medicare Advantage side, you know, we have clear evidence that we're paying Medicare Advantage plans tens of billions of dollars a year that we're not supposed to be paying them under the law. And we also have evidence that those additional payments aren't generating commensurate value for beneficiaries. So I think the trade-offs involved in these two policies are quite
▶ 1:51:15Now when Medicare Advantage was first created, Dr. Fedler, it was sold as a way to give seniors more choices, better coordinated care, and lower costs. But after two decades, that promise hasn't held held up. Instead of saving money, the federal government is now paying 20% more per beneficiary in MA than in traditional Medicare to the tune of 28 uh $84 billion in overp payments this year.
▶ 1:51:39So, we know that 50% of every additional dollar paid to MA plans actually benefits uh patients and that's just 50%. The rest goes towards profit marketing and prior authorization systems that increasingly rely on artificial intelligence. We've seen AI tools deny chemotherapy, rehab, and postaccute care, not because the care wasn't medically necessary, but because the algorithm said no.
▶ 1:52:08That's why I'm preparing to introduce legislation that would require transparency in how MA plans use AI, ensure that any AI system complies with traditional Medicare coverage standards, and mandate physician review before any adverse determination is issued. It would also direct CMS to audit AI algorithms and evaluate their impact on patient access. Dr.
▶ 1:52:33Felic, can you talk about the necessity for federal um guard rails on uh these AI technologies?
▶ 1:52:41So, I think just as there's been a lot of discussion about the need for appropriate oversight of prior authorization generally, um I think there's an important need to make sure that that framework extends to AI and the other new technologies that we have coming down the pipeline. Um in some cases that'll happen automatically, but in some cases that's going to require policy action to make sure that happens.
▶ 1:53:02Um obviously to the extent that doesn't happen the sort of you know talking about we had some discussion about striking the balance of good prior off but excessive and avoiding excessive prior off and I think the same we need to strike the same balance with respect to the use of AI.
▶ 1:53:17Thank you. I yield back.
▶ 1:53:19I now recognize Dr. Murphy.
▶ 1:53:21Thank you Mr. Chairman and thank you guys for holding this. I I think this is an issue really that we have a lot of bipartisan support. I will tell you point blank, I'm a f I'm a fan of MA plans with a caveat. Um, they do decrease hospitalization. We do have managed care. We prevent people from um, getting sicker. Absolutely. And I tell you, when I was doing my research yesterday, um, I applaud you guys for actually doing it right. I applaud y'all for doing it right.
▶ 1:53:49What I'd like to see are the United Healthcare, the Humanana, and the Etna sitting in front of us because they have bastardized the system and they have ruined Medicare Advantage to what it should be. You guys are doing it right. I went down to Puerto Rico several months ago. 95% of the Medicare patients there are Medicare Advantage. They do it right. United left after three months because they couldn't squeeze enough money out of the system. So, you guys are doing what it's intended to be.
▶ 1:54:16And just as like with PBM programs, it was started out with a good plan, but when profit and actual fraud happens, this is a problem. Um, Mr. Chairman, I have an article here, how health insurance from the Wall Street Journal. Imagine that. They're good, five good articles that I would love my colleagues to read. How health insurance racked up billion in extra payments from Medicare Advantage. I'd love that submitted for the record. It shows how um especially United Health Group, I'm calling them out and I'll continue to call them out. without objection. So,
▶ 1:54:46there's some people that are probably going to end up going to jail because of the way they've ruined the system. The sec second thing is how United Healthcare Army of Doctors are the largest employer of physicians in the country. How they mobilize them, how they militarize them to up code. I'd like to submit that article also for the
▶ 1:55:05Without objection, so order.
▶ 1:55:07Thank you. You know, I I I I've gone through this a couple times with my colleagues here before I ask any questions of what the what has happened with the with uh what's what's gone wrong with Medicare Advantage. Taking a good system where you guys are doing it well and taking it wrong. There's a diagnosis that poor Dr. Miller, I've seen that look in your eyes when you've been up all night. I got that look so many times. Actually, some of my colleagues had that a few weeks ago. We've gotten a little used to it here. We don't want to though.
▶ 1:55:32uh United Healthcare diagnosed something called secondary hyperaldderonism in three quarter of their enroles. Threearters of them it's only 3% on fee for service. They are ruining a good system and sadly enough we have seen the nation um respond against insurance industries uh you know after the tragic death of the United CEO there were hundreds of thousands of dollars donated by people to the defense of the guy who murdered him. That's the outrage that we're seeing.
▶ 1:56:02So, you know, I guys, we have to correct this and this is a bipartisan issue. We we can't we can't uh throw away a good program, but we can throw away bad actors for sure. Uh Dr. Miller, God bless you for staying up all night. Thank you very much. Um can you tell me, do we need the stars rating system?
▶ 1:56:21Absolutely. Not measuring quality is a mistake, whether it's the quality of a physician, a hospital, or a health plan. I think the problem with the star quality rating program is that the star quality rating program does not apply to fee for service as a health plan or ACOs and that fee for fee for service as a health plan ACOs don't have an opportunity to get that bonus. I think the other problem is that there's no downside.
▶ 1:56:48So ideally the stars quality rating program would apply to fee for service Medicare ACOs and MA and have upside risk and downside risk and that's something that max could help with.
▶ 1:57:00Yeah and I agree completely. This is something you know when we when managed care or rather MA plans came in especially with United they would undercut I couldn't take their patients. I I had patients that I've been seeing for years and all of a sudden they got Joe Nameoth Joe Mammoth brought them in. um and I can't take them because they don't pay anything or their denial rate was insane. This is something this committee and actually this Congress should change. The star system I'm still not 100% sold on because I don't see its efficacy.
▶ 1:57:30Um but for that matter, it would be great to have it on the other side. Um tell me a little bit private practice-wise, Dr. Miller, I know you're not in private practice. How can how can private practice survive in the world of Medicare Advantage? So private practice and the opportunity for a physician to own and operate their own business and is getting crushed.
▶ 1:57:53So when you finish medical school residency fellowship, you can go work for a large taxexempt hospital corporation, you can work for a large university health system, you can work for the VA. It is hard to own and operate your own business. There are legitimate concerns about induced demand in a fee for service setting. Medicare Advantage is not that.
▶ 1:58:13We should look to empower private practice as a viable alternative to large taxexempt hospital monopolies and have a stark waiver in a managed care setting to make private practice great again.
▶ 1:58:26Thank you. You know that I I'll just say this. The insurance lobby is the strongest lobby in this town. It has strangled this place and it is time for Congress to take back what was originally intended for health care and not let the insurance industry strangle this country. Thank you, Mr. Chairman. I'll yield back. I now recognize Mr.
▶ 1:58:44Thank you very much, Mr. Chairman. Good afternoon to you and good afternoon Ways and Means Committee and to our panelists. Welcome. We're glad to have you here. I like Dr. Murphy from North Carolina am a big fan of managed care. I was a state legislator for many years in the free state of Florida. We partnered with managed care to get our spending under control. And I think Florida has one of the largest state surpluses in the nation is because we finally uh work worked to make that happen. But I'm going to be honest with you guys.
▶ 1:59:14I am as confused as can be. I was hoping to learn uh what's the what is the deal with managed care uh because we heard that uh we've heard that the quality is high but yet costs are we don't know is it uh is it better than fee for service costwise or or not.
▶ 1:59:32Um, what if what if there was a bill what if there was a bill that required CMS, hear me out, CMS to release the full data of uh of managed care versus fee for service so we could see once and for all uh where the savings are and what's happening. I got good news ways and means I have filed that bill. I call it the apples to apples bill.
▶ 1:59:58Let's let CMS release the full data so we can make u a full decision of where we need to go. I think uh healthc care is kicking our financial fanny as a country and until we get those costs under control then uh then we're going to struggle with debt. So first question here we go Mrs. Moroni. Uh some say uh we're saving money some say we're not saving money on uh on managed care. We know there's benefits.
▶ 2:00:25So can you tell me is Medicaid advantage delivering a costefficient solution for seniors and taxpayers?
▶ 2:00:35Absolutely. Uh when you look at the average consumer that or beneficiary that enrolls into an MA plan, they're over older than 71 years old. The average premium is about $17 for those um individuals. Um however, for our program, most of those individuals have a zero premium plan. They have full comprehension when it comes to the part C and the
▶ 2:00:56How do you know? Do we have full data? You feel really comfortable. If I was a scale, if I were to ask you on a scale from 1 to 10, how confident are you on that answer, what would it be?
▶ 2:01:04Uh, probably about nine and a half.
▶ 2:01:06Okay. So, you say there's room for improvement of that answer. So, uh, let's go to Dr. Miller because you've talked about this in your testimony that uh that uh we're not comparing you, in fact, you've said it's apples to oranges, some of the data that we're getting from uh from CMS. Uh wouldn't this be a good bill? And if you were in Congress, would you vote for the bean bill? Apples to apples?
▶ 2:01:28I mean, I' I'd have to read the details, but I agree with the principles. I think right now we're doing uh apples to kumquat trees. So, I'd take it a step further. The problem is is that we're only looking at the beneficiaries who switch from fee for service to Medicare advantage. We're not looking at beneficiaries who switch from Medicare Advantage to fee for service. And we're certainly not looking at the choice that millions of Americans make when they enroll in Medicare and comparing those bennies who are in fee for service and Medicare advantage.
▶ 2:01:56So that 22% number, I actually think that it's not accurate because it only represents a small share of the Medicare population and there was no control group.
▶ 2:02:071040. Thank you so much, Dr. Basil. Uh, welcome to the party. Jump in. What say you to have I know docs like to have more information than less information. So what say you?
▶ 2:02:18So as far as in my comments, you know, one of the things we asked for was greater transparency. And so transparency is absolutely something that we support. Now you asked about you know how do you compare the quality before it. I can say that you know within our own shop in many ways some of our Medicare advantage patients actually have higher level of qualities. You know the percentage of our Medicare Advantage patients that get annual wellness visits is actually much higher in our MA plans than it is in our traditional Medicare plans. And many other quality metrics are that way.
▶ 2:02:47But we don't have that full realm of quality outcome to be able to compare apples to apples. I would
▶ 2:02:53104. You know, in state of Florida, what we do is uh we capitate the plans. We paid them. We we already knew what uh fee for service was. We came in much under that and allowed uh managed care to go forward. Is there uh is there fraud and savings to be found? I'm uh working with this Doge uh uh the the Doge conference so to speak to work on uh savings. Is this a good place to look? Uh Dr.
▶ 2:03:19Miller would say there are a couple bad actors that definitely probably deserve a visit with the Department of Justice, but on the whole the program I would say from a fraud, waste, and abuse perspective is not the major target.
▶ 2:03:3310460 out of the 550 MA plans were audited last year. Uh, President Trump says we need to audit all of them. With that, I yield back. Thank you, Mr.
▶ 2:03:42I now recognize Mr. Evans.
▶ 2:03:46Thank you, Chairman Buchanan and Ranking Member Dogget for holding today's hearing. Well, I want to talk about how Medicare has become to use food as medicine initiative. I cannot do that without recognizing how Republicans actions are damaging health care. The Republican SNAP cuts and hauling a SNAP education program hurts progress we could have made in this topic today.
▶ 2:04:15The success from HHS that food as medicine programs use SNAP education partnership is no longer possible. The loss of healthy food for 22 million families for SNAP programs stop food as medicine effort and leads higher educa health We should be working on ways to improve underlining access to food and healthc care coverage.
▶ 2:04:45But at least today we can learn that more of our witnesses today that see better use of food as medicine. Mr. Fel can you tell me more about food as medicine medical advantage plan? So I am not um particularly familiar with those um those aspects of Medicare Advantage plans.
▶ 2:05:11certainly is the case as you know we've heard discussed that some Medicare Advantage plans will um as one of their supplemental benefits um try to better address beneficiaries food needs um and I think the question as with all of these questions is you know is a payment to a Medicare advantage plan the most efficient way of addressing those concerns or are there other ways that the federal government can address those um those issues more directly.
▶ 2:05:40So I understand you said would you have any suggestions then relating to the whole concept of food playing a factor or other suggestions?
▶ 2:05:54Um so you know in so far as our concern is the affordability uh is households ability to afford food. Um I think you know you alluded to some of the changes to the supplemental nutrition assistance program. I think you know that is our core tool that the federal government has to ensure that food remains affordable.
▶ 2:06:13I think there are there is a role for the health care system here as well um as some of my colleagues have alluded to in making sure that people have the dietitionian and other advice to then once they can afford food um purchase um you know purchase the the the the foods that will make them healthiest. But I I do think there well so there was there's a role for the health care system here. Um I think in some cases addressing some of these issues can most effectively and efficiently be done um outside of the healthare system itself.
▶ 2:06:43I'd like to thank you Mr. Chairman.
▶ 2:06:47I now recognize Mr. Hearn.
▶ 2:06:50Thank you Mr. Chairman. Uh much has been talked about with the supplemental benefits of MA plans. In fact about 99% of all the MA plans offer at least one supplemental benefit. And over the last several years, the MA program has endured significant funding reductions as a result of the Biden administration policy changes. Unfortunately, due to the past administration's heavyhanded actions towards MA is becoming harder for MA plans to offer a wide array of supplemental benefits for our seniors. Dr.
▶ 2:07:20Jen, you you can can you explain how this rule making in the past four years around Medicare Advantage has affected the supplemental benefit offers to seniors and can you tell us how plans are adjusting or you know working on this so that they can can continue to offer these attractive benefits to seniors?
▶ 2:07:37Sure. I I would say there's been two different categories of changes that have been implemented in the program as it relates to rulemaking. So the first has really been uh risk adjustment and the implementation of the V28 risk model which effectively has been a hair revenue haircut to the industry. Um and when the industry gets less revenue, we're able to offer less benefits. That's how the Medicare bid system actually works.
▶ 2:08:00So um while V28 definitely addressed some of the types of coding abnormalities that have been you know discussed at this hearing uh it certainly also reflected a cut in revenue to the industry which translated into uh less generous benefits last year will continue this year and will also continue next year. The second area where CMS made changes was on the uh star ratings and the methodologies used to actually calculate the cut points for star ratings.
▶ 2:08:30And what we've seen is there's been a decline in the number of four plus star rated plans across the industry. Uh and what that means is that plans are achieving fewer bonus dollars uh and as a result uh are getting less revenue and those bonus dollars are actually used to fund supplemental benefits. Um, I would I would submit that one of the challenges has been that the star rating system has gotten more and more distorted.
▶ 2:08:53A single French phone call uh for Scan Health Plan a couple of years ago would have been that was a a single secret shopper French phone call um uh was rated in a way that ultimately could have resulted in a $250 million swing in revenue to our plan. Uh and for that reason, we actually had to sue CMS in federal court and actually presided.
▶ 2:09:16And so um I would just say we have a star rating system that is not necessarily doing what we hoped it would do which is to reward quality and a robust measures of quality. And I think one of the opportunities you have is to actually grade plans more on a continuum as opposed to have this cliff ratings system which um ultimately results in lower benefits to beneficiaries.
▶ 2:09:39Thank you. Um, a lot has been talked about with MedPAC and some of the conclusions and how they've reached their conclusions. Um, Dr. Miller, you touched on the MedPAC analysis in your testimony and you recently co-authored an article published by Health Affairs that discusses a recent analysis from MedPAC estimating cost differences between Medicare Advantage and fee for service.
▶ 2:10:02uh can you tell us talk to us about the findings that you wrote about in your article and and what we need to know as policy makers to uh as we go
▶ 2:10:10and note that my views are mine and not those of med packs as evidenced by that article. Uh I would say that we need to answer three questions. One is we need to look at those three populations I mentioned not just fee for service to MA but people who switch from MA to fee for service and the choice that they make when they enter the program. MedPAC only looked at one of those three populations. So we're not getting a 360G degree view of the program. Favorable selection, coding intensity, coding intensity.
▶ 2:10:41We've talked many times and I talked about this at the JEC hearing a few months ago. We need to automate diagnosis coding at the point of care under the purview of a physician. So that way people are completely coded across programs whether it's fee for service or MA. A lot of coding intensity differences are appropriate.
▶ 2:11:03Some of them are fraudulent like what you know a large plan has potentially done sounds like it's problematic and there will be o and should be oversight of that favorable selection. Again, we need to look at how this happens in the real world. I don't know what the combine harvester is that a plan is driving down the coast of Florida to pick up all the healthy tennis playing Medicare beneficiaries. I don't know what the marketing strategy is.
▶ 2:11:33I don't know what the plan selection strategy is. I don't know what the benefit design strategy is. I was an FDA product reviewer and we deconstructed pharmaceutical development programs and then reconstructed what we thought the drug did and didn't do and then validated that in the real world with pathophysiology of disease. We need to do that for all of the Medicare advantage to fee for service comparisons and have transparency of the data and the statistical coding behind that.
▶ 2:12:03Thank you Mr. Miller and Mr. Chairman I yel back.
▶ 2:12:06I now recognize Mr. Moran.
▶ 2:12:08Uh, thank you, Mr. Chairman, for this very valuable hearing today about Medicare Advantage. For background for our witnesses, I want you to know I represent the first congressional district of Texas where just over 83,000 of my constituents have chosen to enroll in Medicare Advantage plans. That's roughly 48.6% of Medicare eligible individuals in my district. As I travel through my district, which is very rural, I hear a lot of struggles uh faced by many in the Medicare Advantage plans.
▶ 2:12:37These struggles are not unique to my district, but they are exacerbated by uh the fact that I am in a rural community. It's why I think this uh hearing is very important today so that we can figure out how to make the changes we need to make so that Medicare advantages man advantage works appropriately uh when chosen by our constituents.
▶ 2:12:57Uh the number one difficulty that I hear about is that providers are forced to navigate these prior authorization rules that are really unworkable oftentimes that that create delays or denials from medically necessary care. Continual prior authorization denials require as you guys know a significant amount of staff time to appeal the denials which pull staff away from their intended goal of providing care. Dr.
▶ 2:13:20Miller, in your uh written testimony, you mentioned quote uh the significant administrative and documentation burden resulting in burnout as it relates to prior authorizations. From your experience, how might the administrative burdens associated with prior authorization impact the work of physicians and staff?
▶ 2:13:40So, I think prior authorization makes it harder to be a physician, but it also recognizes that physicians don't always make the right choice. I mean, I'd like to think that I do or my colleagues, most of the time we get it right. Some of the time we don't get it right. Having to resubmit paperwork, having to send in a fax, having to call someone and voice dictate, as one of my colleagues here mentioned, is is nonsensical.
▶ 2:14:06The process, there's nothing wrong with having prior authorization as a process. Every other insurance market has that. Whether it's Medicaid, whether it's the ACA exchange plans, whether it's employer sponsored insurance, the only place that does not have prior authorization in a meaningful form is fee for service Medicare until of course the introduction of a new CMS innovation center model recently.
▶ 2:14:31But prior authorization is something where we need to make it easy for clinicians and hospitals and other providers to get the data into the plan. Make it clear what the criteria are at the point of care and then automate approval. I know that other members had expressed concern about AI. We should use AI to make the process more efficient.
▶ 2:14:54If I can automate prior approval for a drug, a surgery, an imaging study, that is a win and we need to make that the default.
▶ 2:15:03Dr. Basil, uh you mentioned in your testimony items re relating to the prior authorization issue as well. In particular about post-accute care, which generally results in longer hospital stays that are costly when the prior authorizations don't come through. I can tell you I heard from a number of my home health groups back in the district who shared stories where they were unable to provide care because the prioritizations would have taken too long and they simply had to move on to other patients. Uh I want to ask you Dr.
▶ 2:15:31Basil what impact does this have on the care patients desperately need the costs associated with the care ultimately received and what needs to change in this process to correct these issues. So I would agree with the general themes kind of of the day is going to be transparency and consistency. Consistency between plans and the transparency and how these decisions are made. So and the repeatability of that decision every time. I totally agree with those.
▶ 2:15:58From a you mentioned home health standpoint, you know, as a faith-based institution, you know, we go ahead and send people to the appropriate level of care and if that ends up getting denied, we just have to eat that. And so we made the decision, you know, from a corporate standpoint that we're just going to go ahead and do the right thing clinically and let the rest of that sort out. But it is certainly an
▶ 2:16:18Miss I want to come to you on the last question because the issue of transparency was just mentioned and I believe transparency is really one of the foundations for trust in any uh situation, but particularly here. We need more transparency for our beneficiaries. I think uh to be aware of the potential supplemental benefits that are out there, accessibility of providers, potential prior authorization issues that might uh come up with respect to certain procedures.
▶ 2:16:43In your uh opinion, you mentioned in your testimony that you emphasized again that Medicare beneficiaries trust us. Again, I think trust and transparency are related. How might increased transparency in these areas that I mentioned and others from health plans to providers and beneficiaries ensure that plans are delivering the services they advertise to beneficiaries and that trust is delivered?
▶ 2:17:06If I think about just supplementals, it would be great to have uh readily available public data specifically uh produced by CMS about supplementals and the utilization around that for all payers and all plans. So that as you're designing a unique plan in the future, you're designing it directly to the consumers and what their absolute needs are specifically.
▶ 2:17:28In addition, uh prior authorizations, you can publicly you can publicize that data specifically on the plans and their utilization rates and then put that in a uh system directly to beneficiaries to know who is uh offering improvements in this area to create competition and more choice for
▶ 2:17:47Thank you to the panel. Mr. Chairman, I yield back.
▶ 2:17:50I now recognize Mr. Delmed El Benny.
▶ 2:17:54Thank you, Mr. Chairman, and thank you to our witnesses for joining us today. I'm glad we're here to discuss health care. Uh, with the Republican mega bill stripping over 15 million Americans off of their health coverage, I can't think of a timelier topic. And while coverage is incredibly important, many Medicare Advantage beneficiaries know that coverage is just the first step to re receiving needed care.
▶ 2:18:20One thing I consistently hear from seniors in my district is the frustration, and many have talked about this, the frustration they have with getting procedures and treatments approved by their insurer. We all know that this is prior authorization. This practice has denied life-saving care to Medicare beneficiaries. It shouldn't take multiple phone calls or even faxes uh to get a routine procedure approved.
▶ 2:18:44The Trump administration recently announced a voluntary agreement it reached with the health insurance plans to alleviate some of the problems with prior However, four days later, CMS announced a plan to increase the use of prior authorization in traditional Medicare. And who is allowed to contract with CN CMS to review prior authorization claims? The Medicare Advantage plans.
▶ 2:19:12So um this is a case of one step forward and two step back. In 2023, Medicare Advantage plans made 50 million determinations and of those determinations that were denied, over 80% were eventually approved. U Mr.
▶ 2:19:28Fielder, how much time do these appeals take and how much of how much does it cost to constantly re-review these So, I'm not aware of data that speaks specifically to the amount of time consumed in navigating appeals, but we do have data looking at how much time providers spend um navigating prior authorization um processes. Generally, um you know, if you talk about physicians, it's you know, hours out of their work week.
▶ 2:19:56You talk about non-fysician practitioners, it's often more. And of course, the administrative staff that work for them, it can be a, you know, substantial fraction of what they do all day. So it is a it is a substantial um consumer of time for for physicians offices for other types of healthcare providers and obviously you know that's means it's a substantial driver of cost as well
▶ 2:20:18and not actually going towards providing health care at that moment. Um my colleagues and I agree that this is an issue and we've been working for years to reform prior authorization. Recently, the Trump administration hosted a roundt that highlighted the negative impacts of prior authorization. And after years of effort to reform prior authorization, it seemed like we were all on the same page.
▶ 2:20:41However, just days after the administration's roundt, CMS announced their new wiser model, which contracts with private companies, including Medicare Advantage plans to increase the utilization of prior authorization in traditional Medicare. This model is running in six states, including in my home state of Washington.
▶ 2:21:01To make matters worse, CMS has indicated that model participants will be compensated based on a share of averted This approach appears to reward participants based on the volume or cost of care they prevent from being delivered or paid. Once again, creating this perverse incentive to deny care in order to make a profit. Um, Mr.
▶ 2:21:25Fielder, with all that we know about the abuses of prior authorization, is it a good idea to implement this tactic in traditional Medicare?
▶ 2:21:33So, as some of my fellow panelists um have talked about, I think it's about striking a balance. I think broader use of priau authorization in tra traditional Medicare could be appropriate if it's done in a thoughtful way. Um that being said, I'm sympathetic to the concern that the particular compensation structure that CMS is thinking about here does create um incentives for plans to or for the contractors in this case to deny requests that should be approved.
▶ 2:22:01Um and I'm it's I think not clear that the safeguards that the model notionally has in effect to address those concerns are going to be adequate to the task. So I think this is the place where the devil is really in the details. Um, and I guess, you know, probably the most important thing is, will this model make it easier for seniors to get the care that they deserve?
▶ 2:22:19I think whatever its merits, it's hard to see how it would expand access to
▶ 2:22:24And I think that's got to be an important priority for everyone here. Um, thank you all. I yield back, Mr.
▶ 2:22:31M. Miller, you're recognized.
▶ 2:22:33Thank you, Mr. Chairman, and thank you all for being here today. I appreciate the opportunity to discuss the Medicare Advantage program, especially as the program has grown with my generation nationally and in my district. West Virginia's population is aging and over a quarter of my home state's population receives their health care through Medicare. Of those patients, of course, 54% of them choose to enroll in Medicare Advantage plans.
▶ 2:23:02Patients in my district have gravitated towards MA plans because of their affordability and supplemental benefits that they provide. The time and effort it takes to travel to a doctor in my district is a key factor for many patients when they're trying to decide what particular benefits they want to go with, what plan. So MA plans have become increasingly popular.
▶ 2:23:28As MA coverage has increased, we've unfortunately also heard some of the concerns from the patients and providers around prior authorization and payments. You're hearing this over and over across the country. Rural hospitals and health care providers report experiencing lower reimbursements from MA plans and this has led providers to leave the MA networks which then creates coverage gaps in rural areas. Dr. Bazelle, some quick questions.
▶ 2:23:58What can be done to ensure Medicare Advantage plans work with rural providers to allow beneficiaries to get the coverage that they need?
▶ 2:24:09So, particularly in the rural, we are not as sophisticated at being able to fight on behalf of the uh prior authorizations. And so anything that we're doing to streamline that process, you're hearing this same same theme over and over again about transparency, Um, one of the things that I think is going to be helpful as we talk about this, you know, I'm a I'm a clinical informaticist as as well. And we always talk about making the right thing to do the easy thing to do.
▶ 2:24:39And right now, we're not doing that effectively. And so if you can do that, you know, to remove a lot of the administrative burden, that's where I think we're going to make
▶ 2:24:48My second question is really how can we make rural areas more in line with urban areas in terms of access and value?
▶ 2:24:59Yeah. So there's still when we look at our own uh provider sponsored Medicare Advantage plan, I I come back a little bit to that network adequacy. It's it's difficult for us to expand into expand into a lot of our counties because we can't get the specialty access that it requires to be able to even offer MA plans in a lot of our rural counties.
▶ 2:25:17And so that limits us to kind of some of our bigger counties and and so I think there's some medic there's some tele medicine improvements that have helped with that being allowances of tele medicine to account for network adequacy but I think they probably need to go a little bit further because that's still probably the primary item that's preventing us from expanding into some of our rural counties.
▶ 2:25:37I've also noticed some of the doctors with certain specialties are now coming to rural hospitals say one day a month or one day every other week and and I think that helps. Um Dr. Miller, I've heard concerns from rural providers about the prior authorization process when working with Medicare Advantage. Rural providers are less likely to have resources for dedicated teams to handle their authorization requests and denials.
▶ 2:26:04The paperwork associated with prior authorization takes time away from patient care. Can you walk me through the process for a referral for a patient who is covered by Medicare Advantage versus the traditional Medicare and what are the staff resources required for those two types of admissions and how can we stream that streamline that
▶ 2:26:26I'd say it depends upon the plan. And it depends upon the service whether you're talking it's elective surgery, an MRI imaging study or or whatever it is. I actually did part of my training in Coopertown, New York, a village of 1,400 people in upstate New York at a small 228 bed hospital. So I would say that the main issue is that the administrative friction takes time and that that administrative friction when unnecessary takes time from patient care.
▶ 2:26:54And that's why I think one of the things that we all have mentioned here is is that eliminating those steps of human-driven data submission, human driven diagnosis code coding like have the clinician drive the data to the plan but have it be easy like we're I'm sitting next to an informaticist have it be one click.
▶ 2:27:17So, a lot of those friction steps and prior authorization is the actual process as opposed to the plan oversight, if that makes sense.
▶ 2:27:28I think so. Thank you. I yield back my
▶ 2:27:31Miss Vandime, you're recognized.
▶ 2:27:34Thank you very much, Mr. Chairman. The Medicare Advantage program provides millions of seniors with greater choices, added benefits, and coordinated care. Yet it's also important to recognize that both its value in the areas where reform is needed. Uh with that growth comes the responsibility to ensure the program is working as intended for both patients and for providers. That includes addressing delays caused by prior authorization and reducing the regulatory burden on those delivering care. I was glad to support Mr.
▶ 2:28:01Kelly's improving seniors timely access to care act of 2025, a common sense bipartisan effort to modernize the prior authorization process. This bill cuts through red tape, streamlines approvals, and ensures that providers can stay focused on what truly matters, which is caring for their patients. Uh, unfortunately, some providers have been forced to take to social media to share the real world consequences of our broken system, including heartbreaking stories of patients who have been lying on the table waiting for author authorization.
▶ 2:28:30And it's not just the patients and the providers, but it's also the families who are left um bearing the emotional and the logistical burden of these delays. And that's especially true at the end of life, which is why we should be cautious about the charges to end of life care, ensuring that we don't add more red tape or uncertainty for families already facing incredibly difficult moments. And Mr. Mr. Chairman, I ask unanimous consent to enter into the record the following article by Hospice News titled Timely Access to Hospice Care, a national imperative.
▶ 2:29:01Without objection.
▶ 2:29:02Thank you, Mr. Chair. Miss Moroni, when a patient suffers a major stroke or a traumatic brain injury, getting the right care at the right time is critical and too often patient care is delayed due to prior authorization processes and the patient sits for days in a hospital instead of following a doctor's recommendation to transfer to a specialized setting. In your opinion, is this the best way to care for uh patients in recovery?
▶ 2:29:25Absolutely not. Um in the sense of if they're being delayed, if a physician how should I say this? If the physician is a directing care, then that patient should absolutely receive that care. Um I actually don't see that happen specifically where there's a delay in care when somebody's sitting in a hospital, etc. um it's usually on continuity of care or transition of care or post care.
▶ 2:29:52So when they're being released to the hospital, we are very proactive on trying to make sure what's their plan. Do they live alone? Do they need to be in a a skilled nursing facility? And in is that skilled nursing facility at a high rate? Like when it comes to star ratings or quality type measures and then at that point when they're getting in the home, do they have food? Do they have other things that are accessible and available to them? That also starts in that process. And I know I've talked about the uh the prior off for us being less than 2%.
▶ 2:30:21We look at that continuity of care end to end all the way from the pre-ervice all the way to the post service when it comes to actual care so that they are having mobility and independence um um when they're outside of a hospital
▶ 2:30:35So are you aware of any timelines that Medicare Advantage plans must follow regarding how quickly they must approve prior authorization decisions? I I do read about it and I see it and I see I hear it in the environment. We'll hear this from other organizations about the delay um specifically that just is not an experience with our company.
▶ 2:30:54As a result of it.
▶ 2:30:54All right, Dr. Miller, I appreciate uh imaging ambassador right in Coopertown. My dad did his internship in his residency. We lived in Coopertown. Unless you've suffered through some of their winters um and and gotten the benefit of their summers, you it's a beautiful place. So, I'm glad you mentioned that. Brought back fond memories. I want to follow up on my previous question.
▶ 2:31:13As a practicing hospitalist, when a patient's care is delayed due to prior authorization processes, is it fair to say that it's not just the patient who is impacted, but it's also another patient who may need hospital care and can't access it?
▶ 2:31:28Yeah. And it also impacts the doctor, too, right? because you're trying to make an excuse for why someone hasn't gone to a skilled nursing facility or an inpatient rehabilitation facility and they're sitting there in the hospital and you're saying, "Yeah, I'm I'm sorry. I'm waiting for the plan." Now, the the flip side of that is, ironically, sometimes that extra day or two in the hospital with physical therapy and occupational therapy might actually get that patient to a better place.
▶ 2:31:54So, that patient who we needed to send to subaccute rehab might actually be able to go home with home physical therapy. So, I'd say it's it's good, but it's also bad.
▶ 2:32:04Okay. Dr. Basil, would do following up the question that I had asked um to Miss have you seen any of those examples where people are waiting?
▶ 2:32:12So, you brought up the stroke example. That's a great one where we've seen considerable pressure, you know, on stroke patient that has considerable rehab needs and really needs to go to an inpatient rehab level of stay that it is really difficult to get that approved in MA plans. And most of the time they get downgraded to skilled nursing level of care, which is a step down in intensity from inpatient rehab.
▶ 2:32:35And so I'd say that's a pretty consistent theme that that we do see is that type of down code down regulation of where we can send them versus where the physician thinks is best.
▶ 2:32:45All right. I appreciate that. I've run out of time. Thank you. And I yield
▶ 2:32:49Mr. Davis, you're recognized.
▶ 2:32:51Thank you, Mr. Chairman, Chairman Buchanan, Ranking Member Dogget, Chairman Swagett, Ranking Member S. Let me thank all of you for holding this hearing on Medicare Advantage and I certainly want to thank all of the witnesses who have been with us for a long period of time.
▶ 2:33:21Medicare parts A and B and Medicare Advantage part C are two distinct ways to receive Medicare benefits. The former is a federal program offering basic hospital and medical coverage, while the latter is Medicare advantage plans offered by private companies and often includes some additional benefits.
▶ 2:33:51Unfortunately, this hearing is not the dastardly acts that Republicans have done with their big ugly bill HR1 that impacts and demises the American middle class and lowincome people's health insurance coverage. It became law on July 4th, 2025.
▶ 2:34:17This law cuts out more than5 $1.5 trillion dollar in spending from safety net programs such as disproportionate share federally qualified health centers, Medicaid, Medicare, changes to the Affordable Care Act, and eliminated eliminating premium health tax credits.
▶ 2:34:46for those who purchase insurance through our marketplaces along with 17 million Americans being purged from insurance coverage. Also, our seniors who are in nursing homes and long-term care facilities are negatively affected by this law as well.
▶ 2:35:11In my state of Illinois, these cuts affect 35.4% 4% of all children, 40% of moms giving birth and their newborn babies, 40% of working age adults with 69% of people living in nursing homes, 18% of Medicare beneficiaries, and 15.6%
▶ 2:35:426% of adults aged 19 to 64. So, while today's hearing had the potential to produce fruitful discussion on how best to improve Medicare advantage, I can't help but point out the hypocrisy of this hearing as it comes on the heels of my Republican colleagues ongoing effort to clash 1.5 billion
▶ 2:36:13dollars in Medicaid and the Affordable Care Act marketplace plans. just to support the enactment of tax cuts for the ultra rich. Uh Dr.
▶ 2:36:29Feedler, as an economist, could you share your thoughts on how these cuts will impact the American economy as it increases medical debt and insurance companies premiums get raised?
▶ 2:36:51So, we have very good research on what happens when people become uninsured and and what does that mean for their financial lives and um you know when somebody lo when someone's on Medicaid they're basically completely protected against the risk of catastrophic medical expenses and when they're uninsured you know thankfully most people in any particular year won't have a major medical event and end up in the hospital but some of them will and when that happens and you're uninsured that is a financially
▶ 2:37:21ruinous outcome for you. And so what we see is negative effects on people's credit scores and ability to get a mortgage, get a credit card. Um we also see effects on eviction and other financial and economic outcomes are worse uh when people are
▶ 2:37:39Thank you, Mr. Chairman. And I believe that even when we improve and if we do Medicare Advantage, it will take years to try and make up for the damage that is being done to our healthc care delivery system now. Thank you very much and I yield back.
▶ 2:38:02Mr. Fitzpatrick, you're recognized.
▶ 2:38:05Thank you, Mr. Chairman. Thank you to our witnesses for being here today. In my home state of Pennsylvania, uh year after year, uh more seniors are choosing to enroll in Medicare Advantage plans with approximately 54% of seniors on Medicare now enrolled in Medicaid advantage plans. Uh these plans have been uh proven to be significant cost savings uh for our seniors.
▶ 2:38:30Uh just in my home state of Pennsylvania, uh MA beneficiaries spend approximately 37% less than Medicare fee for service annually uh with an average of over $3,000 in savings on out of uh out-of- pocket costs and premiums. There's also uh health outcomes that should be highlighted. 70% fewer hospital readmissions for MA beneficiaries relative to the traditional population and lower rates of unnecessary medication usage.
▶ 2:39:01There is nothing more important than ensuring our seniors have access to affordable and high quality highquality care. Uh first question for Miss Moroni. Um, can you speak to how alignment health coordinates with physicians and care teams to ensure the highest quality of care is provided to your beneficiaries? And can you address uh how offering special needs plans including uh benefits such as meal plans has impacted patient care?
▶ 2:39:30Thank you for that question. Um, the whole team has to be involved. the physician that we actually have critical intervention teams specifically for your higher risk patients as well as um people that are just aging into um Medicare or into the program specifically as they're starting out.
▶ 2:39:48Um so depending on the age and stage of or the diagnosis of that individual is a development of a care plan that is u specific to that individual um indivi uh consumer or beneficiary as well as making sure that the physicians starting with the primary care and or if there's an interdisciplinary uh team as a whole is integrated in that plan.
▶ 2:40:12So it's it's putting u a very proactive integrated approach to care no matter where they are in their age or stage um specifically or diagnosis to address that. Our ADK our admits per thousand are sitting at 149 ADK in comparison to over 200 plus when you look at the basic fee first service program.
▶ 2:40:36our readmission is in, you know, in the low numbers specifically in comparison about four to five percent better than Medicare fee for service. Uh and so we look at that and then you can offer additional benefits above and beyond traditional Medicare that are very rich directly to that bene Medicare beneficiary.
▶ 2:40:54to where they're utilizing getting food or getting um special vitamins or getting fitness or dental hearing uh among a a vast variety of uh packages that are customized specifically for that constituent.
▶ 2:41:07Thank you. And I want to note um Medicare Advantage can be strengthened must be strengthened specifically through uh modernizing approaches uh to administrative challenges. Uh Mr. Chairman, I'm very glad to see prior authorization being addressed uh by the industry in an effort to streamline and improve patient uh experiences. The potential for administrative burdens delaying access to care. We've all seen it.
▶ 2:41:30We've all heard about it, especially uh medically necessary care must be taken seriously as more seniors tr choose MA plans. Uh at a time when too many providers are already stretched in uh therapy requirements place an additional administrative burden particularly on independent and community-based practices.
▶ 2:41:50Many providers report experiencing high administrative challenges uh when navigating varying MA plan step therapy step therapy policies for physician administered drugs. This often requires hiring additional staff and adds hours of administrative work each and every week. Uh Dr. Miller, uh final question for you.
▶ 2:42:12Um how might this administrative process be improved so providers time and resources are more focused on delivery of care rather than step therapy requirements on prior authorization delays. So input for drugs in particular, putting the formulary taring into the electronic health record, showing where the beneficiary is in their deductible, showing what's not formulary, showing what requires a prior Roth, automating that data submission.
▶ 2:42:41And I I I think that the managed care industry has the funds to do that. Hopefully now they have the political willpower to do that given that we've now had probably 20 conversations about prior authorization amongst all my colleagues and I over the past couple hours. And I would say, you know, Medicare Advantage plans, they spend around 72% of their rebate dollars on reducing beneficiary cost sharing or premiums for routine medical services. So that means, and that's A, B, and D benefits.
▶ 2:43:11So that means that there are other dollars in there that they can use to um promote and improve it administrative process.
▶ 2:43:20Thank you. Thank you all for your time. Mr. Chairman, I yield back.
▶ 2:43:23Before I recognize the gentleman from Ohio, I want to inform the members that votes have been called across the street. I intend to call a recess following Mr. Miller. Five minutes of questions to call the committee back. We'll call the committee back in order immediately following the vote series. I now recognize a gentleman from Ohio for five minutes.
▶ 2:43:43Thank you, Mr. Chairman, and thank you to our witnesses for your time and testimony here today. I'm pleased we are holding this important joint hearing on the capacity of Medicare Advantage or MA to deliver quality health benefits to America's seniors. Across our nation, more than half of Medicare beneficiaries choose Medicare Advantage in relation to traditional Medicare for their coverage of choice. In my home state of Ohio, nearly 60% of Medicare beneficiaries are rolled in MA plans.
▶ 2:44:10Ohio also has one of the most robust MA markets in the country with plans available in every county and more than 36 plan options for beneficiaries to choose from. As we strive for higher quality care and more efficient health care system, we must acknowledge both the valuable benefits and the challenge of medic the challenges of Medicare Advantage, many of which we have heard about today. One of MA's core goals is to provide beneficiaries with better health outcomes at a lower cost compared to traditional Medicare.
▶ 2:44:40Reported results among many plans include lower out-of-pocket costs, one-third fewer emergency room visits, and a 29% reduction in avoidable hospitalizations. However, concerns remain particularly and around administrative burdens that can delay care and impact quality. Von Secour's Mercy Health of Ohio reports higher denial rates, almost twice as longer provider reimbursements, and increased administrative burdens. One of the concerns that impacts my district is prior authorization.
▶ 2:45:10And last year, Cleveland Clinic alone spent $25 million to manage such requirements. I am heartened, however, by CMS collaborative efforts and will closely with my colleagues delivered to support prior authorization reform to enhance healthcare efficiency. It's my hope that through this hearing we can build upon MA contributions and strengthen care for patients and viability for the health care system. Dr. Miller, in your testimony, you echoed concerns raised by Dr.
▶ 2:45:37Basil regarding prior authorization and its impact on Medicare Advantage patients and health care providers, which focuses on process improvement, reducing burden for physicians, hospitals, and other health care providers. What recommendations do you have regarding prior authorization or other administrative burdens to enhance the quality and efficiency of care?
▶ 2:45:58Say make it easy for clinicians and health systems to get the data to the plan. So don't all these unnecessary steps fax machine. I mean I I haven't seen a fax machine in someone's home for 20 plus years and and the idea you know I had a prior authorization and I had to make a phone call like me as the patient. It's it's sort of ridiculous.
▶ 2:46:20So the the health plan industry can adopt sort of basic IT processes that the auto insurance industry has for say car repair that the life insurance industry does that you know warranty claims for cars like all of those basic IT operational processes. someone in these businesses needs to sit down, map out the steps, and solve the problem.
▶ 2:46:43So that way, we're not sitting here complaining about it because it's okay that it exists as a process, but the friction in that process needs to be addressed and it can be addressed.
▶ 2:46:54Thank you for that common sense answer, which I very much appreciate. And also, I could have used your help when we had an oversight hearing probably a month ago with the IRS. They also use fax machines that are completely outdated and they're 1960s technology. And by the way, they are not safe and they are not secure uh at all. So be that as it may, uh Dr. Basil, I continue to hear concerns about Medicare Advantages impact on vulnerable rural hospitals.
▶ 2:47:19How can Congress protect and strengthen access to critical innovations in coordinated care such as inhome care for seniors, especially those in rural
▶ 2:47:29Yeah. So it goes back to you know the transparency over the approval process and you know I absolutely support the efficiency of the process but also the transparency in the approval or or more importantly the denial reasons. You know you ask one day you might get a different answer than you asked the next day. You talk to one uh medical director you're going to get a different answer from a different medical director at the same plan without knowing why that decision was made.
▶ 2:47:58And so certainly the efficiency is one aspect of that but the transparency of how those decisions are made. You know it was brought up earlier that I think AI can really add to the efficiency but I do worry without the transparency then you don't know well how did the AI decide upon that? And so how am I supposed to make better decisions if I don't know why that decision was made? I
▶ 2:48:20I really appreciate that with the strides in technology that we're seeing. You know, maybe we're there yet, maybe we're not there, but it's my hope that we can get there that day to where you can achieve and we can get that transparency across the board so people know that they're not being taken advantage of one way or the other. Thank you very much to our witnesses. Thank you, Mr. Chairman. I yield back.
▶ 2:48:38Thank you, Mr. Miller. Um, as was announced before, we're going to go into recess. We still have a couple of us to ask questions. Um, this has actually been a wonderful panel. We shall return. This is the um this is Congress.
▶ 2:48:53So, we'll be back I've got to Hello.
▶ 3:15:17Oh, there we go. Oh, hello. Okay. Thank you so much everybody for sticking around. We appreciate all the time that you put in here today. This is not easy to follow for those of us that are not as immersed in the details as all of you are. And uh I want to just try and ask some basic simple questions to just understand some basic things. So for each of you and I'll start with you Miss but I'll go through all of you. Do you think that Medicare Advantage is good the way it is or does it need to be fixed a little bit?
▶ 3:15:47And you don't have to give me the answer how to fix it if you want to fix it but just do you think it's good the way it is or do you think it needs to be fixed?
▶ 3:15:54I think everything deserves improvement.
▶ 3:15:56Okay. So you think it needs to be fixed? Dr. Miller
▶ 3:15:59oil change and tire rotation.
▶ 3:16:02Okay. So, you think it needs to be fixed
▶ 3:16:04A tuneup would be wonderful.
▶ 3:16:06What's that?
▶ 3:16:06A tuneup would be wonderful.
▶ 3:16:07A tuneup. Okay. Dr. Jane,
▶ 3:16:09I think it's a great chassis, but I think it um it needs a rebuild.
▶ 3:16:13Okay. And Dr. Feedler,
▶ 3:16:15I think it needs fundamental reform to its payment systems. And
▶ 3:16:17you want to see an engine rebuild of the whole thing. Okay. Since we're all automotive mechanics now. Okay. And Okay. So the problems that we've been highlighted to us are are there's three main ones. One is this MedPAC report that says it's 20% more expensive than uh Medicare is. Number two is that uh there's a problem with upcoding and number three is uh that there's a problem with prior authorization.
▶ 3:16:46So Miss do you and I'll go through each one of you. Do you think that there's a problem that this costs too much in Medicare Advantage as opposed to what they envisioned?
▶ 3:16:57I actually do not.
▶ 3:16:58Okay. Dr. Miller, do you think it's costs more than it's supposed to?
▶ 3:17:01I don't think we have answered and asked the right question to answer that.
▶ 3:17:06Dr. Basil, what do you think?
▶ 3:17:07I would agree with him. I do.
▶ 3:17:08Dr. Jane, I
▶ 3:17:09think we need to restructure more towards uh investing in in prevention, primary care, chronic disease management, and um and away from, you know, taking care of people when they're sick. So,
▶ 3:17:22and that would cost less if we did that, too. But do you think it cost too much the way it is now?
▶ 3:17:26Uh I think I think we could make it all cost less if we reoriented the way
▶ 3:17:30Dr. Feedler, what do you say?
▶ 3:17:32Um I think the program costs much more than law intends as and that we're not getting value for that next stage. Okay, very good. Miss Moroni, do you think there's a problem with upcoding in the Medicare Advantage plan right now?
▶ 3:17:45Not with all, but with definitely with Are you talking about in terms of beneficiary size or are you talking about just organizations?
▶ 3:17:56When you compare Medicare to Medicare Advantage, there's like 15% more of the people or 20% more of the people for with diabetes get diagnosed with retina cataract. So it's like some unusual outliers in the numbers in upcoding with Medicare Advantage.
▶ 3:18:10Yeah, I would say that it's less than
▶ 3:18:13Okay, Dr. Miller, up coding is a problem or not?
▶ 3:18:15I'd say it's a problem with several health plans, not the entire industry.
▶ 3:18:19Dr. Basil,
▶ 3:18:20I agree. It's a zero- sum game. It gets renormalized back to an average risk score of 1.0. So there's some that are
▶ 3:18:28I don't understand that. So you think yes, there's a problem with up coding or you don't?
▶ 3:18:31Uh less than half.
▶ 3:18:32Okay, Dr. Jane,
▶ 3:18:34believe it or not, I think there's some undercoding for um in some areas where there's not enough focus on.
▶ 3:18:39So, no problem with upcoding.
▶ 3:18:41Uh no, there is there's definitely a problem with of uping
▶ 3:18:4350% of the cases or 20% of the cases or
▶ 3:18:46you know, I'd rather not uh put a number on it, but I would say that there are some overcoders and there's actually some undercoders.
▶ 3:18:53Okay. Dr. Feedler,
▶ 3:18:55I think it's a serious problem and I think it's very widespread.
▶ 3:18:57Very widespread. More than 50%.
▶ 3:19:00Certainly, if you're talking about number of beneficiaries accounted for by those plants. Yes. Thank you. Okay. And how about prior authorization? Do we think that's o it's overdone right now that there's too much hassle given for prior authorization?
▶ 3:20:09problems with prior authorization and there may be some problems with upcoding and we should look at those things to varying degrees the people here some people think we need an engine rebuild and some people think we only need an oil change and a tuneup so thank you very much but we all agree that there's some problems that we need to address so I want to thank oh and transparency is can I ask one One more question.
▶ 3:20:28Go ahead.
▶ 3:20:29Is transparency I don't know how anybody could be against transparency unless well there is one issue that's going on right now that people are concerned about
▶ 3:20:36Somehow I knew you would go that way.
▶ 3:20:38But but is there some is there could we use with some more transparency with Medicare Advantage? Miss
▶ 3:20:46Dr. Miller.
▶ 3:20:47Yes. And with analysis of it too.
▶ 3:20:49Transparency and analysis.
▶ 3:20:50Absolutely. In all aspects.
▶ 3:20:52Dr. Jane,
▶ 3:20:53I would say uh there needs to be greater transparency at the point of sale and that I think there also needs to be greater transparency in utilization
▶ 3:21:01Very good. And Dr. Feedler,
▶ 3:21:03yes, we just shouldn't think that transparency on its own is going to solve these problems,
▶ 3:21:07right? I would agree with that. Well, listen, I think we're all kind of generally in agreement. And if we could all stop fighting with each other and yelling at each other, we could find some common ground to actually make Medicare Advantage more effective, less expensive, and better for the patients.
▶ 3:21:21Mr. Just a moment. I'm going to yell at you. I love the automobile analogies,
▶ 3:21:25Yes. Thank you so much. Appreciate it,
▶ 3:21:26Mr. Fuzzy. Miss,
▶ 3:21:30Miss Morton,
▶ 3:21:31thank you. Uh, good reminder to get the car in this weekend. I appreciate that. Uh, Dr. Miller, um, there have been a there have been concerns that you actually just all of you answered lots of se lots of questions, a lot of questions that they had they got to answer. I'm going to ask just two.
▶ 3:21:51uh two two individual ones love some context on it but it's but it's in relation to what we just heard um concerns about upcoding right so let's dig into that a little bit in uh concerns that upcoding inhome risk assessments is increasing the cost of Medicare advantage so a specific example for the taxpayer so they the cost is going up uh Medicare advantage insurers appear to be using health risk assessments and chart reviews to inflate payments for Medicare in 2023 insurers received received billions in payments
▶ 3:22:21for diagnosing patients during home visits with new conditions and that apparently don't warrant treatment. Several health plans have been sued for under scrutiny or even or either failing to remove inaccurate codes or willfully upcharging. We have to get a handle on these out of control costs. I think we've establish established that today. How can lawmakers best ensure that Medicare Advantage accountability without sacrificing services like inhome assessments? because my my my example here on in home assessment isn't saying that they're not worthwhile.
▶ 3:22:51I'm just saying there's been some some um taken advantage of here. How can we we balance the accountability without sacrificing these assessments?
▶ 3:23:00So you want all patients to be completely and accurately coded for their diagnosis. If they have diabetes, you want to know whether it's controlled or uncontrolled. If they have kidney complications, nerve complications, visual complications, you want that all coded appropriately. What you don't necessarily want to do is incentivize plans to just go harvest diagnosis codes to get paid more, not do anything about it.
▶ 3:23:25So the the way to do that is to integrate diagnosis coding into routine clinical practice. And we could do that by having it be a component of electronic health records. So instead of me as the physician selecting that the patient I've admitted to the hospital has X or Y or Z diagnosis or some coder going after me to tell me to do that, have the software automatically code that because many and then have the physician make a decision as to whether it's appropriate or not at the point of care and then that gets on to claims
▶ 3:23:55for fee for service and Medicare advantage beneficiaries. and and I don't know all the specifics of this, but as I've been involved in these issues, I've heard I've seen a lot of um discussion about you can use pre-existing data to get some norms and generally target what's needed um and get pretty close. And then I like the part that you just mentioned that you would have the physician be able to like make a final determination on what's really necessary.
▶ 3:24:26Yeah. and make it just uh again you can use doctors, nurse practitioners to do documentation. That's probably not a great use of our brains and and time like we can do that but that's not what you want us to do.
▶ 3:24:41So making that just a routine automated process just like spellch check autocorrect you know completion of emails from your Apple iPhone making diagnosis coding that way and having that engine pull from labs imaging notes that would just make it easier and then you'd know that the patient is completely and accurately coded whether it's in fee for service or Medicare advantage or whether they're on Medicaid or whether they have commercial insurance and it then you would be facilitating
▶ 3:25:11better clinical communication because the chart would have the diagnosis that the patient has.
▶ 3:25:18Yeah. Love it. Thank you very much. Do Mr. Jane, the the Medicare Advantage quality bonus programs may have started as an incentive for better care, but without being regularly updated or or tuned up as we've now established, it has become less effective. The star rating system, for example, is complicated. It considers a lot of different measures. The ratings are reported on a contract level other than rather than a plan level which ropes in several vastly different benefits networks populations making it hard for an individual to make sense of the ratings.
▶ 3:25:48How could a more efficient valuebased system that focuses on outcomes and quality metrics provide more transparency and easily digestible information for seniors in particular?
▶ 3:25:58Yeah, I I think um there's not enough attention paid to star ratings at the point of sale. And I think there's two reasons for that. One is I think this the there's not a lot of belief in the star ratings by brokers. They're not necessarily convinced that a four and a half star plan is better than a four-star plan. And and to be fair, there's one of the challenges with the system is that very small differences can lead to big swings in performance in the star rating system. So in that way, it's not really as robust as it should be.
▶ 3:26:26Am I confident that a four and a half star plan is better than a threestar plan? I am. But am I confident that a four and a half star plan is meaningfully better than a four-star plan? I'm not. And so I think that the reality is is that we need to actually be um to revise the system so that differences in star ratings actually mean something. Uh and I think that right now consumers don't necessarily feel that and they're not being told that by brokers who don't necessarily have that confidence either.
▶ 3:26:53Probably a great time to finish that. Uh I just checked in my Uber profile as a passenger is 4.84 84 and I just wanted that to be on the record.
▶ 3:27:01Mr. Moore, you're better than me.
▶ 3:27:02I wanted that to be on the record and I yield back. Chairman,
▶ 3:27:06so now we know Mr. Moore is a big tipper. Mr.
▶ 3:27:10Thank you, Chair Swikert and to the ranking member. Look, like many of my colleagues, I support a bipartisan approach to many issues including health care. I think the elephant in the room is we just had a partisan exercise where the result was taking health care away from 17 million Americans, not creating more access or affordability.
▶ 3:27:34And just recently after the vote of the bug big ugly bill, the House Budget Committee chairman told Bloomberg that Republicans are planning even deeper cuts to Medicaid and also con considering further spending reductions in Medicare. So on top of the 500 billion in Medicare um that would be $1.5 trillion in total healthc care cuts.
▶ 3:28:01So help me understand how we're supposed to just come to the table now and agree um without understanding the impacts to our constituents. Time and again, congressional Republicans have chosen to go after beneficiaries rather than to pursue the kinds of systemic reforms that are needed to increase transparency and accountability across the health care system. Dr. F uh Mr.
▶ 3:28:30Fidler, can you outline how the big ugly bill would destabilize the Medicare system going forward and where can beneficiaries expect future cuts to Medicare if they were made? Um so the the provisions of the bill itself um in terms of its effects on Medicare are comparatively limited.
▶ 3:28:52The one important place where I think the bill will have significant effects on Medicare beneficiaries is it um rolled back policy changes made during the Biden administration to make it easier for Medicare beneficiaries to get assistance paying their premiums and cost sharing. um and those provisions um will will no longer go into effect and so those enrolles will have more difficulty getting those benefits.
▶ 3:29:17Um in terms of other effects on Medicare um there is an effect on the sequester um that would in principle uh require um reductions in Medicare spending and and we'll see what happens.
▶ 3:29:29Thank you. Now, Medicare Advantage is now the health care choice for nearly 34 million seniors and people with disabilities, accounting for about 55% of the entire Medicare population. In my district, that number is even higher at of beneficiaries who've opted for a Medicare Advantage plan. A key driver of this growing enrollment is the broad availability of supplemental benefits.
▶ 3:29:55In fact, over 99% of Medicare Advantage plans offer at least one supplemental benefit, and most enroles report that these benefits are a major factor in choosing their coverage. Dr. Jane and and Mr. Fiddler, two-part question.
▶ 3:30:13Can you speak to how the supplemental benefits available through Medicare Advantage, benefits not currently offered by traditional Medicare help particularly lowincome patients manage out-ofpocket cost? And Mr.
▶ 3:30:28Fiddler, from a policy perspective, what steps can we take to enable traditional Medicare to offer similar supplemental benefits, particularly in the critical areas of hearing, dental, and vision, which we attempted to do when we had the majority. Supplemental benefits can be the difference between someone accessing health care and not. They can be the difference between someone having a meal at dinner or um being hungry.
▶ 3:30:54uh supplemental benefits can be the difference between someone actually um having a pair of glasses to see clearly or not. So I think these are incredibly impactful and you know for lower income older adults uh you know this is a very these are very high value benefits. Um you know the the value of which often gets lost in in discussions about the the Medicare Advantage program and and and its uh and opportunities to improve it.
▶ 3:31:21Um I will say that there does need to be more transparency around utilization rates because some of our competitors will make benefits available um but then put them far out of reach for the members and so they have sales value at the point of care but then many people at the point of sale but at the point of actually needing a service they aren't there and so there's really an opportunity for I think CMS to take a more um forceful posture in terms of regulating uh medic medic regulating
▶ 3:31:51uh supplemental benefits.
▶ 3:31:53Um so I I mean I think there are significant gaps in the traditional Medicare benefit. Um you alluded to coverage of certain specific services. I would highlight the lack of um a catastrophic limit on annual out-of- pocket spending. Um and I think a lot of the conversation we're having is that we're using Medicare Advantage program to fill some of those gaps but in a rather inefficient way and only for half of beneficiaries. So ultimately the traditional Medicare benefit is under Congress's control and it could fix that gaps.
▶ 3:32:19I think that would have benefits for traditional Medicare beneficiaries, but also frankly for those who rely on
▶ 3:32:29Thank you. I want to thank all of our witnesses for their testimony today. Uh, and I just want to note that I've worked with a number of my colleagues on across the aisle to attempt to improve the Medicare Advantage program. So, this is a bipartisan issue. In fact, I'm working with Mr. Arrington to ensure that uh MA plans promptly and fairly pay providers for services to ensure stability for our hospitals and less delays in care for patients.
▶ 3:32:56I've also worked with Miss Van Dy to ensure that patients entering postaccute care have access to to the appropriate care setting irrespective of whether they are on MA or fee for service Medicare. Um and I welcome those conversations. I think we need to have those conversations and I think we need to have those thoughtful conversations, but we should have had them two months ago when we were marking up the one big ugly bill. A lot of Republican colleagues want to root out waste and fraud in the MA program.
▶ 3:33:26But let me be clear about what happened. Two weeks ago, Republicans cut 17 million Americans healthcare to root out waste fraud waste and fraud. Republicans triggered$500 billion dollars in cuts to Medicare to root out waste and fraud. And for what? Because Republicans blew up our deficit by $3.4 trillion. And that's according to the nonpartisan Congressional Budget Office um their report that came out yesterday.
▶ 3:33:57So, you're going to have to forgive me if I'm a little cynical and I don't believe in their commitment to the program integrity. Um, President Trump also made a promise to the American people. He said he was going to lower health care costs. Well, let me ask you, Dr. Jane, you represent 12,600 constituents in my district and a total of about 300,000 covered people.
▶ 3:34:21I know you legally cannot discuss SCAN's Medicare Advantage bid information for 2026 until it gets approved by CMS. But according to this analysis, over a 100 ACA marketplace insurers um premiums are rising by a median of 15% in 2026. Do you agree with that
▶ 3:34:44Um so we're you know scan does not operate in the uh in the exchanges. So we don't necessarily um have a lot of visibility into that. Um what I will say is that you know there is the potential for there to be stress added to the system uh at large because of changes in payments. Our providers may look elsewhere for revenue opportunities. And I think um that might end up having an adverse impact on beneficiaries and other types of insurance plans.
▶ 3:35:11But I would say it's too early to say really what the what the actual impact is going to be across the delivery system and and the plan environment.
▶ 3:35:18Okay. Some insurers are reporting that President Trump's tariffs, possibly on drugs, medical medical equipment, and supplies, are driving a rate increase of about 3% on average. Um, do you think that the constant threat of tariffs might impact MA premium increases for next year?
▶ 3:35:36Um, we haven't yet seen any evidence of that, but it's certainly something that we're tracking in the marketplace right
▶ 3:35:42Okay. And while SCAN doesn't participate in the ACA, in your professional opinion, do you believe that failing to renew the ACA enhanced premium tax credits will impact marketplace
▶ 3:35:55Again, I think anytime that there's big shifts in in uh coverage and and subsidies, um there's potentially, you know, impacts on other lines of business. Uh so that's something we haven't seen any evidence of yet, but it's obviously very early. Um, and so it's something we're monitoring for going forward.
▶ 3:36:13Great. Um, Dr. Feedler, I want to ask about value in Medicare Advantage. Right now, I think that one of the flaws in the system is quality measurement. In the quality bonus program, how are MA plans incentivized to provide high Um so in principle we measure plans on a variety of um their performance on a variety of different measures in terms of getting uh patients appropriate care um and other measures.
▶ 3:36:40I think my concern is based on the evidence we have that it's not particularly effective in encouraging plans to actually improve care as opposed to encouraging plans to invest a lot of administrative cost in optimizing their scores on these measures. I think that one example of how we inaccurately measure plans performance is the overturn rate for prior authorization denials.
▶ 3:37:04From 2019 through 2023, more than 80% of denied prior authorization requests that were appealed were overturned and most seniors don't even appeal their authorization denials. They just kind of give up. Um Dr. Dr. Jane, would measuring plans prior authorization overturn rate improve these procedures and potentially decrease delays in care for patients?
▶ 3:37:31I think measuring that kind of rate and making it transparent to beneficiaries is one of uh I think the best ideas out there to actually um create real transparency for folks about what they're actually buying. Um, I think one of the biggest challenges with the Medicare Advantage industry right now is that many of the beneficiaries don't actually know what it is that they're buying because they don't they may not have an active health care need.
▶ 3:37:56Few years later, they may develop uh, you know, a cancer and they would like to go to an out of network uh, cancer center and unfortunately it's not necessarily available to them and they didn't know that that wouldn't be the case.
▶ 3:38:10And so again, I think that you the idea that you propose, the idea of um making transparent the overturn rate is one of these, you know, kind of great ideas that could potentially make uh the program far more transparent to people and hopefully over time improve
▶ 3:38:28I appreciate your testimony and I yield
▶ 3:38:32Thank you, Mr. Chairman. Thanks to all the witnesses for your written and your verbal testimony and appreciate this opportunity to wave on. I'm not normally on this committee, but obviously this is an important topic. So, uh, it's a good opportunity, but I'm going to narrow. You've obviously talked a lot about a number of things um, dealing with Medicare Advantage and but I'm going to focus on one thing and I'll get to that after I got a couple of comments here. I come from the central coast of California, 19th congressional district.
▶ 3:38:57Um, and you know, obviously it being the most beautiful congressional district in the nation, if I may say so, in my humble opinion, actually biased opinion, um, a lot of people want to live there. a lot of people retire there. So Medicare is the number one issue and unfortunately it's has a lot to do with the reimbursement rates to be honest with you. That's why I've been focused on reforming payments to doctors and clinicians under Medicare Part B.
▶ 3:39:21However, we know that traditional Medicare is not the only place where seniors and other beneficiaries receive their care in my district. And as of last year, 33.3% of Medicare eligible beneficiaries were enrolled in Medicare Advantage. Statewide in California, more than half of those who live there choose Medicare Advantage, consistent with the national trends. But what's troubling is the advent of these things called ghost networks. And that's going to be the crux of my questions.
▶ 3:39:50Under unlike traditional Medicare, Advantage operates more like a typical commercial health plan, meaning patients have a private insurance company and seek care from providers in their networks. And like those of us who have commercial insurance, going out of network will cost you. For seniors on a fixed income and the disabled, this simply isn't an option. Patients rely on provider directories from Medicare Advantage insurance plans to find in network providers.
▶ 3:40:18However, many insurance insuranceer insurers fail to update these directories, creating ghost networks of providers who are listed as options for care despite no longer practicing, no longer accepting patients, and are not part of the plan's network. The confusion that can arise from ghost networks can result in delays in care, inappropriate treatment, and unnecessary costs for patients who unknowingly visit out ofnet network providers.
▶ 3:40:48Dr. Miller, in your testimony, you explicitly mentioned ghost networks, and I appreciate that. You argue that directory reform would bring Medicare Advantage plans closer to the private market. Can you elaborate and expand on that, please? So, I admit I'm a little biased because as a medical student, I incurred an $8,000 out of network medical bill because the provider directory was not up to date. So, I have personal experience in that being a problem.
▶ 3:41:17The ACA exchange marketplace actually has a function where the beneficiary or the consumer can put in their doctor, hospitals, uh, drugs and see if the plan covers it. You can't actually do that in the Medicare planfinder.
▶ 3:41:34And if you do that, it would force the entire Medicare Advantage industry to make sure that provider directories are up to date and create a routine process which can then be used to audit the plans um and implement penalties as appropriate for not having an up-to-date directory. I mean, have you you can't get access to care if your doctor is not in the network and you didn't know that you end up paying for it.
▶ 3:42:01And when you're a Medicare beneficiary and the average income for half of them is under $50,000 a year, that's expensive. So, I think that updating the planfinder to ensure that provider directories are up to date and so that when a Medicare beneficiary selects Medicare Advantage, they have an unbiased source of where they can get that information is something that we have to do.
▶ 3:42:23Yeah, thank you. Look, one of the reasons I like being on the ways and means committee is there's members on both sides of the aisle that actually want to get stuff done. I've introduced a bill with Dr. Murphy, Mr. Schneider, Mr. Fitzpatrick called the requiring enhanced and accurate lists or real health providers act. Uh the bill would require Medicare Advantage insurance plans to update their provider directories annually and ensure patients aren't left on the hook for out-of- pocket expenses like the one you described.
▶ 3:42:51You got opinion on how um a bill like real health health providers that requires plans to update their directories annually, how that would impact Medicare Advantage?
▶ 3:43:01I mean I I haven't read the text. I'll have to look it up, but on the principle, it makes sense. I would say that it has to be integrated into the planfinder so that way the consumer can make sure that they see it or the person helping the consumer pick a plan.
▶ 3:43:14And I and I would say in addition to that, the planfinder should allow the beneficiary to compare fee for service, metagap, and a standalone part D plan with MA and see what their out-of-pocket premiums are and see what the trade-off of having lower out-ofpocket costs for premiums versus accepting a network because right now the beneficiary can't figure that out from the planfinder.
▶ 3:43:38I appreciate that and look forward to working with you and all of you on fixing this. Thank you everybody. I yield back. Thank you, Mr. Benetta. Miss
▶ 3:43:51let me uh thank u Mr. Schwiker, the the chair, and I thank all of our witnesses for staying and hanging out here um uh for this extended hearing. My name is Gwen Moore.
▶ 3:44:06I'm from Milwaukee, And um I just I'm going to share with you that 64% of my constituency is enrolled in Medicare advantage is much higher than the numbers that you've heard here today. People have talked about the national average being 51 52%.
▶ 3:44:29And so that has caused me to wonder uh about the appeal of Medicare Advantage to communities and constituencies like mine and the demographics that are involved in it.
▶ 3:44:45um in I guess maybe I'll ask you uh Miss um uh Maloney Moralon I had a great colleague named Maloney so forgive me Moroni um your um you say that you that you only deal with uh prior being denied in about 2% of the cases.
▶ 3:45:10How then can your plan afford really to provide people with the level of services and care when you in fact uh get all of your care needs authorized uh and um uh how so so how do you do that? I was curious.
▶ 3:45:33Thank you for asking that question and congratulations on the high percentage in your your district. Um, you know, our organization believes in a hightouch proactive approach to care and so we try to get in front of a prior off in advance of that care.
▶ 3:45:50So, hight touch through clinicians that are complimenting the private network so that we make sure that people are getting access to their drugs, they're getting access to their specialists, they're getting access to their primary care, and we also have care navigators that navigate to make sure that the administrative burden is out of the way. If we're doing that, then we're eliminating the prior off process without them asking for it. We're just setting it up for them in advance.
▶ 3:46:17That That's very good. I appreciate that. Let me ask you um Dr. Feedler um we've heard a lot about how upcoding uh coding intensity and favorable selection really uh hikes up the cost of Medicare advantage. How can you uh and at the same time choose someone who has less health problems and have that sort of jive?
▶ 3:46:47So I think there are two. So you can take any given person no matter what health conditions they have and what the MA plans have gotten very good at is finding an additional diagnosis that wouldn't even if they're fairly healthy that wouldn't otherwise have gotten recorded and make sure um that gets written down. Why is there favorable selection? I think what's also happening is you know frankly in traditional Medicare you have a broad network fairly lightly managed plan.
▶ 3:47:14On the MA side, you typically you have networks often fairly narrow and you have substantial utilizations restrictions. And so if you're someone who needs a lot of health care and you're choosing between those two options, often the traditional Medicare option is going to look more appealing because you think it's going to be easier to get the care you need.
▶ 3:47:31All right. Thank you. I am concerned and you know maybe Dr. Feedler and maybe uh Ms. Morona, you might want to explain to me that it seems to be that there are more people of color, uh, brown people, Latinos, African-Americans subscribed in Medicare Advantage, and they don't, we've heard here today, people don't necessarily get the services uh that are they're purported to deliver through uh Medicare Advantage.
▶ 3:48:01So it makes me wonder uh if people aren't being taken advantage of when they on on the basis of this demographic. So when we start talking about transparency, uh one of the things that concerns me is I think that uh former President Biden tried to get a handle on this and of course President Trump um uh really stopped the practice of trying to determine do do you all think that it would help us with regard to
▶ 3:48:32figuring out how to reform medicare advantage if we knew uh whether or not the these demographics graics were part of that uh that mix. Dr. Feedler,
▶ 3:48:46so I think it's absolutely the case that better data on Medicare Advantage um would allow us to have a better picture of how the program is working all working overall and how it's working for particular communities. Um, I think there are frankly major gaps in the data that CMS is collecting and then to some degree the data that CMS is releasing on uh the Medicare Advantage program that will allow us to have a much more complete and accurate picture.
▶ 3:49:12And just very briefly, you know, Medicare Advantage is of course pays much higher than Medicare, uh, Medicaid, even private insurance. This is a this is it's nearly double the individual market. Medicare Advantage. How would the loss of a trillion dollars in uh you know the Affordable Care Act not renewing the premiums for people?
▶ 3:49:40Uh how will this will MA be held harmless and the half half trillion dollars um triggered in in uh in Medicare advant Medicare cuts?
▶ 3:49:53Okay. Moore and
▶ 3:49:55Okay. I I'll just let you answer, Dr. Fedler, and then I thank the chair for his indulgence.
▶ 3:50:00So, if the sequester would go in were to go into effect, that would have significant consequences both on the traditional side uh traditional Medicare side of the program and on the Medicare Advantage program.
▶ 3:50:10Thank you, Miss Moore.
▶ 3:50:12I yield back. There's never enough time, but I
▶ 3:50:15I appreciate you all. Thank you.
▶ 3:50:17And what one of the reasons I often go to the end is it's just us. Um I f I want to first off uh thank all of you. I know it's been a long day. We're already you know far beyond. Um I promise not to keep you here more than a couple hours. Um also to the say thank you to staff. Um so let me start with a couple things. I I I want to run.
▶ 3:50:43Um much of the let's call them the lobbying the expert community. You've been remarkably helpful to us in understanding the complications of a managed care model, you know, capitated, those things. There are some bad actors.
▶ 3:50:59If any of you are the lobbyists for whoever is buying the MAGA influencers to basically attack anyone who's trying to understand the economics within MA, um, please understand, we've asked the lawyers to start investigating. is this unregistered lobbying and we're going to find out who's paying for it. So just if anyone's watching, please understand you started it, we're going to end it. All right.
▶ 3:51:27Can I walk through a handful of things first? Um let's just get it out of the way. I have a series of articles that I'm going to put into the record and because I get to not object to myself. Um, you've all probably followed the five, is it seven-part Wall Street Journal series that walk through even people in Arizona that were um diagnosed with diseases, except they were never treated for them.
▶ 3:51:54And the plan always said, well, that was be we hired a contractor to send people's homes. Um, we paid billions of dollars in diagnosis. This is the upcoding problem. are um risk adjustments and problems. Um the going at those who ask a question um and it just and some of it just continues and continues and continues.
▶ 3:52:21And we even had a couple members talk about the Wall Street Journal article about those who are actually getting their healthcare from the VA but somehow still sitting in Medicare Advantage. Um, we've also have articles and we're actually looking into um those when it's a push off to force someone who starts getting near end of life and it's part of a MA plan and to force them into fee for service for hospice care and trying to now chase down some of the odd
▶ 3:52:51numbers there. Um, you've also seen the articles that on some of the brokers and the investigations going into there and the false claims that appears to be But why are we doing this? Why are we having parts of this conversation? Um, here's some of our math that in seven Medicare is supposed to be now this is full Medicare. This is the whole plethora $2 trillion.
▶ 3:53:21We go from functionally one trillion this year in seven years to two trillion. Some of that's demographics. Actually, it's mostly demographics. Healthcare costs. Um the peak of the baby boom moving into much higher utilization years. Um I got some math problems um trying to make this all work.
▶ 3:53:44And so we're trying to figure out I think the concept of a managed care model that helps our brothers and sisters who have moved into their benefit years live healthier. When I'm seeing data that 31% of Medicare is and then when we broke down the subsets of that the number of our brothers and sisters who are 65 and up that had obesity issues.
▶ 3:54:13How do I incentivize a model particularly if 50 our math is 55 not 54 55% of our brothers and sisters on Medicare advantage across the country some places higher penetration that that there's an incentive for a plan saying we benefit by making our members healthier. So this is from my opening statement the alignment of incentives. One of the reasons I I have great fondness for Dr.
▶ 3:54:43Miller is he's been very kind enough to testify in front of our joint economic committee and in that we were fixated on the use of technology to also lower the cost. So um first question before I go off on some of the things um Dr. Miller first list let's just go where we were going to go before.
▶ 3:55:02If I came to you and be a little um, said, "Okay, we have the technology today that follows you around that the AI transcribes your notes. Here's your here's my doctor's notes. Here's my healthcare contract, whether it be private or advantage plan." The AI can say they match and it's basically automated or pre-authorization. Am I being too utopian?
▶ 3:55:32I think it's operationally possible. I think that the issue is does the industry have the willpower to do this and then will the hospital industry come to the table? Because one of the other issues is that if you're an incumbent large health system, you don't have an incentive to improve operations.
▶ 3:55:53when if you're a hospital executive and you can lobby to increase Medicare fee for service rates, you can merge with a larger health system, you can do all these other things before coming to the table to improve clinical and technical I think that's an incentive issue. So I think we need pressure on the health systems in conjunction with the managed care industry to work together to solve these technical problems because they are very solvable. Dr.
▶ 3:56:23So you think people the brain trusts like us we need to be more prescriptive in our
▶ 3:56:31I don't think prescriptive. I think it's sort of like when you have two squabbling children. The answer is stop fighting over the matchbox cars and learn how to share. So I think you have the hospitals and you have the health plans arguing. And you have the plans saying I have big monopoly hospitals. And then you have the big monopoly hospitals saying, "I have these big mean monopoly health plans." And sometimes they're monopolies and sometimes they're not. But they need to figure out how to work together for a better system and solve that technical operational friction.
▶ 3:57:02And you've you all are functionally their parents.
▶ 3:57:04Um Dr. Miller, one thing I want you to touch on how you would adjust Stark to accomplish one of your goals.
▶ 3:57:12So I think that's really important if you're a physician and you know I mentor and train a lot of young physicians. you don't really have any employment choices. You face a labor monoponyy where you can work and I remember I saw this dermatologist who was depressed and I asked him why he's depressed and he said well you know he had two large health systems that he could work for and he couldn't do anything else and he was stuck on an assembly line.
▶ 3:57:34So, Stark law was created with to address valid concerns about induced demand that if physicians own and operated integrated care delivery that they would self-refer and drive a lot of unnecessary services, whether it's imaging, whether it's labs, whether it's home health.
▶ 3:57:51And so we have an opportunity now with Medicare Advantage being half the marketplace to wave Stark because you have health plans who are doing utilization review and prior authorization to make sure that the right thing is done because it doesn't make sense for us now to say that if you're an orthopedist and you work for a large health system, the health system can require you to self-reer for physical therapy and MRI.
▶ 3:58:17But if you're in private practice, that orthopedist, you cannot self-reer for MRI or physical therapy for integrated care delivery. So, we need to put private practice physicians on an equal platform to large multi-billion dollar health systems and managed care as our vehicle for us to do so.
▶ 3:58:36Dr. Jane, um, your written testimony, um, actually, this is going to sound odd, provided me some joy because in many ways in there, you have much of the model that we've been trying to move back, not reform to, in some ways, we're just trying to go back to what the original vision was, that the incentive is an organization benefits by
▶ 3:59:06our brothers and sisters becoming healthier and and trying to find those steps where because um a a a enrolley, a patient, a member can stay with you longer, you invest in their future health. Um in your vision for your organization because you have lots of data points.
▶ 3:59:29Do you see a place where you could also use things like, you know, grandma gets a whoop or an oral ring or the the the wrap that sits as a wristband that actually helps you monitor hypertension and temperature and those things?
▶ 3:59:45Is there a place where the the the continuity of care particularly for your rural you know we had a whole conversation about transportation and those things but not teleaalth digital health in many ways is is the future on helping the maintaining of of of of latitudinal health data is that woven into or do you see that
▶ 4:00:14I think it's absolutely possible I think one of the reasons that value based care has largely been a failed experiment in this country is that uh it can't be practiced in one-year increments. If I don't know that you're going to be my patient a year from now, three years from now, 10 years from now, I'm not necessarily going to make the rational investments in year 1 to improve your health in year three or year 10.
▶ 4:00:36And so I think one of the opportunities that the committee has and that Congress has more broadly is to start to entertain this notion of multi-year enrollment and Medicare advantage. Multi-year enrollment would enable us to have stability of the the population which would allow us to in integrate these digital health solutions in year one that ultimately have really failed to improve population health even though we have very sophisticated technology right now because people are
▶ 4:01:06underinvesting in these technologies because they don't necessarily um have the confidence that investing in year 1 will result in savings in year 2 3 four five and uh if plans had a longer period plans or even CMS in the traditional Medicare program had a longerterm view of cost uh and had a way of internalizing the savings. I think there would be incredible momentum towards the kind of health care system that you're imagining. Uh Mr. Schwiker,
▶ 4:01:34doctor, you may be about to become one of my best friends, which is a little creepy. You never want a politician as one of your best friends. We're expensive. Um but but look, we've been trying to model the concept of um what happens if I have someone who has multi-chronic conditions or BMI issues? How do I help them and then but make it so it's rational to invest in it and then help them stay there? And and that's look, that's not partisan. That's just investing in in long-term healthcare.
▶ 4:02:03But one of the um uh issues that's been brought to us by actually a handful of the plans that have been remarkably good at working with us and providing us actually some very private data. We we we've made some promises not to say some of the things out loud is the way the advertising and broker when open enrollment is of how you're often trying to steal each other's members.
▶ 4:02:30uh we saw a number and we're we're still working to vet it that the total advertising broker marketing could be as much as 20% of the book. Does that number seem rational to you?
▶ 4:02:4320% seems high, but what I will say is that you know the number one line item, you know, the GNA line item for most plans is distribution. Um, so if there were ways to actually um cut our overall distribution costs or recast the distribution costs um to be more focused on health promotion behaviors,
▶ 4:03:04but investing in actual health care instead of late night cable television,
▶ 4:03:09we we have a proposal that we've put forward um which is uh the notion that brokers should be recast as community health workers. Um these tail commissions that we pay folks several hundred dollars a year um should be reoriented around making sure that uh older adults get primary care appointments, they get their colonoscopies, they have someone in their life,
▶ 4:03:31but that but that would be within the plan once you're enrolled. But but Dr. Miller had had actually sort of the other side saying look if I have the data set that says I could do fee for service, I could do a combination here. I could do but and and see it all right in front of you. The technology is your
▶ 4:03:51The front the you know Dr. Miller is 100% right. The the front door to the Medicare experience is one that needs to be totally rebuilt. Uh turning 65 in this country is very complicated. Uh and it's one of the reasons um that I think people are very confused and don't know what to do. Uh is because there isn't a lot of transparency. It's because you have to sign up for Medicare. you've got to sign up for part B. It's an alphabet soup for the average older adult who feels paralyzed in the face of the decision-m.
▶ 4:04:20And I think, you know, uh I don't I'm not a Republican or a Democrat. I tell people I'm an effectivist. Um I believe that we need
▶ 4:04:27Oh, so you're starting another party with Musk?
▶ 4:04:30No, no, not at all. Not at all. But what I would say is But what I would say is I really want our programs to work the way that they were intended to work. And I think that that's where our focus should be right now. Look, at some point we have to deal with the reality and and this is more for staff to hear. Um, our current model says in seven years the part A trust funds empty and there's a structural 11% cut coming.
▶ 4:04:54Um, let alone a 24% cut coming to people on social security and we double senior poverty. We have the scale of these things is stunning amounts of money. It's demographics. you know, we we have a shortage of young people. We got much older. Um, so Dr. Bassel, you actually you're one of your specialist, you have everything from urban to rural.
▶ 4:05:23If I came to you and said, "We're going to incentivize um the ability to use much more digital health care in in rural America." Is there a way that actually both raises your quality, lowers your cost?
▶ 4:05:40Um, because I can't tell you how many of my doc friends tell me someone came in from rural Arizona and they didn't need to, you know, drive for two hours down from Flagstaff to get to Maricopa County if we had had the scan had been, you know, um, sent properly or we duplicate the scan. Like I I have a fixation of all MRIs, X-rays, ultrasounds need to be attached to this so they travel with the individual.
▶ 4:06:06We think there could be 25 plus billion a year just in duplicative scans. But the ability for you to have continuity, more investment in technology, does that solve or at least help your rural issue?
▶ 4:06:21No, absolutely. So we've actually changed EMRs lately to get access to a broader network of electronic records. That interoperability piece is certainly part of that equation. And you talked about digital health as well. So my wife is a pulmonary and critical care doctor and you know in a very rural network probably 15 20% of her patients already are via tele medicine. So her if she's in clinic on a given day her 9:00 patient will be in person.
▶ 4:06:49her 930 is very likely going to be somebody from three hours away that she's seeing via tele medicine, you know, to save that family having to drive that three hours.
▶ 4:06:58I want I want you to think much more revolutionary. Maybe this is more in Dr. Miller's utopian of technology.
▶ 4:07:05Um and and you staff is telling me they're they're late for their cocktail hour. Um, we actually, you look, I've been doing tele medicine since I got here and was never ever going to get a hearing until COVID hit and then suddenly it's the law and the world didn't come to an end and the amount of inbound crap I took in advertising those things beating me up because I was but the fact of the matter is the data that I can
▶ 4:07:35wear come off my body that you know the breath biopsy all the other things you can have in your home medicine cabinet. That tele medicine may not be talking to a human.
▶ 4:07:47it could be getting my readout telling me if I need to go to, you know, my my doctor. Um,
▶ 4:07:56we're already having steps like that. My watch just told me it's I need to be getting up and move around.
▶ 4:08:01Yeah. Yeah. My aura ring was doing the same thing. So, look, I cannot thank you We're going to have the continuing sort of debate and we're we're digging into it. As you know, the oversight committee is doing a deep dive. We're trying to do the data. We're trying to understand is MedPAC, you know, is this thing correct that I have 120% over the cost of fee for service.
▶ 4:08:29If that's gap, you know, that gap would be a stunning amount of money over 10 years. We want the continuation of a managed care that where the incentives are properly aligned. Help us help us with any articles. Help us with data.
▶ 4:08:48And for any of you, thank those plans, those insurers, those researchers who've been positive and helping us and fuss at the ones that are trying to burn us down for even looking under the hood. Um, and with that, we're going to call the hearing to an end, but please be advised that over the next couple weeks, you may get written inquiries that we will ask you to respond to, that we will attach to the permanent record.
▶ 4:09:16And with that, we're going to call this hearing adjourned. Thank you.