▶ 0:18:20And regulatory affairs and the subcommittee on healthcare and financial services will come to order. Welcome, everybody. Without objection, the chair may declare a recess at any time. I recognize myself for the purpose of making an opening statement. Welcome to this joint hearing of the subcommittee on economic growth, energy policy, regulatory affairs, and the subcommittee on health care and financial services.
▶ 0:18:45Today, we are here to explore how innovative technology in the health care sector can help lower americans health care costs. Health care costs in the united states have long been on the rise, but recent democrat policies and the radical biden administration's regulatory agenda have made health care costs in america even worse.
▶ 0:19:05The inflation reduction act, or the ira, signed into law by the biden administration in 2022, was passed under the guise of lowering health care costs for working americans. These two subcommittees recently held a joint hearing on the ballooning costs and the market distorting policies included in the ira. Today, we have another opportunity to take a hard look at the consequences of policies that not only failed to accomplish their intended goals, but place an undue regulatory burden on americans.
▶ 0:19:34Business owners in our country put their livelihoods on the line to develop breakthrough technologies to reinvent the health care industry, but are forced constantly to navigate the regulatory obstacles put in place by democrat administrations. The money spent on legal fees and administrative procedures could be reinvested into further improvement, to further improve technologies that doctors and other medical providers can use to improve patient experiences.
▶ 0:20:03They can be used to save lives and to bring families together. Congress must give private sector innovators the space and the resources that they need to develop these technologies. We've already begun to see the tremendous capabilities of artificial intelligence to help lower costs in our everyday lives. If that power were harnessed in the health care sector, resources could be more effectively deployed to help patients get better.
▶ 0:20:30In addition, lower costs would save the federal government and the taxpayers a lot of money in any any of our federal health care programs. For example, patients can use wearable technology to monitor their health. These devices assist doctors and researchers with realistic data on their patients day to day. In real time. 3d printing can create personalized medical devices for individual patients.
▶ 0:20:59Investment in this printing technology has led to the development of customized prosthetics, implants, and surgical tools. Telehealth improves the efficiency of healthcare by allowing medical providers to serve patients. In a live virtual call. Telehealth saves time and helps patients connect to their doctors, especially in rural areas where there are few medical facilities.
▶ 0:21:23These kinds of technologies are revolutionary, but if innovators cannot afford to develop more of them because of the expensive barriers put in place by the previous administration and the inflation reduction act, the american people will miss out on cutting edge medical care that could improve patient outcomes. Earlier this year, president trump signed the one big, beautiful bill into law.
▶ 0:21:46That bill gives over $50 billion to rural hospitals to ensure that their continued operation and development of medical technology. Since entering office, president trump has taken decisive action aimed at reversing innovation, stifling stifling biden era policies and artificial intelligence, promoting transparent drug pricing and eliminating the biden pill penalty.
▶ 0:22:09Our expert panel of witnesses, including a fellow missourian and a medical technology business owner, will provide testimony on this important issue. And I think all of the witnesses for being here today, and I look forward to our discussion. And with that, I yield to ranking member frost for his opening statement. >> thank you, chairman burleson and chairman grothman. And thank you to the witnesses for being here this afternoon. I got to be honest, I was a little shocked to see this hearing called on health care affordability this week.
▶ 0:22:38Um, as we continue to see congressional republicans block extension of the tax credits that will help people obtain affordable health care, we, as in this moment, are in a crisis. And just five weeks, the affordable care act aca enrollment period ends in 189,000 people in my district alone will be paying anywhere between 50 to 300% more in premiums, and many will opt out of coverage altogether.
▶ 0:23:04So we can hold a hearing about whether technology for new software and medical tools can decrease costs. It's very interesting. Um, I would appreciate that conversation and support innovation in the way that we deliver health care. But to hold this hearing now, while ignoring the massive upcoming cliff in front of us right now, is, quite frankly, an insult to the 25 million americans that will see their health care costs go up if congress doesn't do its job. Health care costs are going to skyrocket for american families.
▶ 0:23:32If people can't afford their premiums, and using technology to make certain procedures or processes slightly more efficient will not change that. We cannot allow the cost of treating cancer, diabetes, heart disease and any other condition, um, to people we know, um, and people we love that are battling every day to bankrupt hard working americans.
▶ 0:23:51I cannot imagine trying to convince my constituents who are about to be paying an additional $2,000 a month in health care premiums, that giving money to tech companies will knock off a few dollars here and there, and that it's the best their leaders can do for them. It's not just my district. Millions of people across the country are unsure whether they can afford health care coverage as premiums and deductibles rise.
▶ 0:24:121 in 4 americans who currently rely on the affordable care act for health insurance are at risk of losing coverage if congressional republicans succeed in letting these tax credits expire. Most americans who are enrolled in the affordable care act will see their health care insurance premiums increase from anywhere from 50 to 300%.
▶ 0:24:31And at the same time, congressional republicans have taken a sledgehammer to our health care system and set us on a path to undo all the gains, uh, that made health care more affordable under democratic leadership. President trump's one big, beautiful bill act takes health care coverage away from a whopping 15 million americans. The single biggest legislative achievement of congressional republicans and president trump this year has been the medicaid, away from almost 8 million people by 2034.
▶ 0:25:00Congressional republicans and donald trump, it seems like, don't care whether or not you can afford your health care or medical care. And we got to be clear this issue is fixable. The health care crisis that congressional republicans and donald trump have created have real and devastating consequences for americans. Patients will go without their preventative and primary care that they need. 1 in 3 young americans are at risk of losing their health insurance in the next few years.
▶ 0:25:24The number of americans without health insurance, health insurance coverage in every state and every congressional district will rise. And thanks to the work of donald trump and congressional republicans, new draconian work requirements for medicaid eligibility, 2.1 million american women may no longer have health insurance when they are pregnant or caring for young children. And then you have people like my governor, ron desantis, come out and say that young people, quite frankly, might not need health insurance if they're under the age of 40.
▶ 0:25:53People who get health insurance through medicaid or the affordable care act. Marketplaces are the same hard working americans that we live and work with every single day. The affordable care act premium tax credits allow farmers, ranchers and small business owners to stay self-employed, invest in their businesses, and employ others. All these things strengthen our communities and economy. Let's not forget that 77% of the affordable care act marketplace enrollees live in states that president trump won in 2024.
▶ 0:26:24How quickly has he abandoned them? Congressional democrats are fighting to make health care more affordable. We are fighting to lower prescription drug prices, and we are fighting to make sure that all americans have access to quality health care. We know we have a broken health care system. There's a lot I personally want to talk about as it relates to this health care system. I personally believe in single payer, but the fact of the matter is right in front of us.
▶ 0:26:47We have a cliff that we are barreling towards, and if we don't do our job, this whole topic of affordability, I mean, it's something that 25 million americans are facing as we speak, as we learn about innovations in healthcare technology today, it's important that my congressional republican colleagues face the reality that health care innovation is not a substitute for affordable health care coverage, and it's not enough to reduce costs on its own. Innovation cannot reverse the damage donald trump and congressional republicans have done with their devastating health care cuts.
▶ 0:27:16I urge all of us to keep everyday working families in mind that are struggling to afford health care. Let's ensure that we pass these premium tax credits. Let's ensure that we don't hike health care costs for 25 million americans from anywhere from 50 to 300%. And then let's get together and figure out what we can do in terms of innovation, to bring down costs for all americans. Thank you. And I yield back. >> I now recognize chairman grothman for the purpose of making an opening statement. >> yeah. Thanks.
▶ 0:27:45Just to respond to that a little bit, um, I think it's becoming more and more over time, apparent that the major beneficiary of the of obamacare or the aca are the insurance companies, and we are at a cliff here where we're going to find out or where we find out what happens when we let the insurance companies, uh, write such a plan.
▶ 0:28:10Uh, we're at a point in which we got to spend $34 billion a year more to prop up a failed plan or come up with some sort of alternative. So welcome to this joint hearing of the subcommittee on economic growth, energy policy and regulatory affairs, and the subcommittee on health care and financial services. This is an exciting opportunity for us to address one of the most pressing issues for americans the continued rising cost of health care. Health care costs have been steadily increasing since 1970.
▶ 0:28:40The total health care spending in the us was just shy of $5 trillion a year. That's $14,500 per person. That's almost 18% of the gdp of gdp. And 1970 health care spending accounted for only 7%. Uh, so it's increased by 150% over the last 50 years. The us spends twice as much per person on health care as other peer nations.
▶ 0:29:05I don't have statistics on how much our insurance companies make compared to other, uh, other nations. It makes sense that the overall health care costs have increased in the past 50 years. Our country's population has grown from 200 million to 350 million. The problem is not that we're not spending money on health care. The problem is that the money that we're spending is being wasted and does not improve patient health.
▶ 0:29:31Recent studies show that nearly one third of health care spending in the us is wasteful, because it does not lead to better patient outcomes, and 2023, that would mean $1.6 trillion spent on health care was wasted. To put 1.6 trillion in perspective, the federal government spent that same amount on total health insurance in 2024, including medicare, medicaid, chips and the affordable care act marketplace subsidies.
▶ 0:29:56More than half of this wasteful spending can be directly attributed to administrative expenses. That's why when you go into a hospital or clinic, you see a huge number of people working there who really have nothing to directly to do with health care.
▶ 0:30:14Over the past several decades, the growth in administrative staff has far outpaced the growth in doctors and nurses, hospitals, insurance companies and health systems now employ layers of administrators focusing on billing, compliance, reporting, coding, navigating complex regulations. Other than delivering care. In many hospitals today, there are multiple administrative employees for every practicing physician.
▶ 0:30:37These costs are passed directly to patients through higher premiums and reduced access to care, higher prices, higher premiums, and reduced access to care. At the same time, patients are left completely in the dark about prices. Someone scheduling a routine procedure frequently has no idea what it costs or how prices compare across hospitals, clinics or providers in almost no other sector of our economy to consumers face this level of price.
▶ 0:31:03Um secretiveness just imagine how much different our entire health care system would be if more dollars were directed towards patient care and less towards administration. This is where technology has the potential to make a real difference, which we. Which is why we felt it was timely, uh, to bring in experts in technology, in the health care sector and see what they had to say.
▶ 0:31:27Empowering patients with price transparency can drive competition, lower costs, and improve access to affordable care. Today's expert panel of witnesses will provide their perspective on how the current health care system costs too much, the leading cause of those rising costs, and how innovative technology and health care sector will make health care more affordable. We look forward to this testimony. And with that, I yield to ranking member krista murthy for his opening statement.
▶ 0:31:59>> thank you, chair grossman. Thank you. Chair. Burleson. Ranking member frost I associate myself with the comments of ranking member frost, and I just want to point a few things out. Um, if we don't extend these tax credits that are going to expire at the end of the year in illinois alone, half a million people who receive these tax credits will see on average, their premiums go from $260 a month to $464 a month, almost an 80%
▶ 0:32:29Increase. Looking closer at these numbers, those living in urban areas will see an almost 90% increase in premiums, whereas people in rural areas would see premiums rise by a stunning 107% on average. So doubling their premiums. Let's be clear people will not stop needing medical care safety net and rural hospitals will pay the price.
▶ 0:32:51Patients will still show up in emergency rooms, but only after manageable conditions have become catastrophic, driving the cost of care through the roof for everyone, no matter their insurance status. Listen, this is not theoretical.
▶ 0:33:06In safety net hospitals across illinois, frontline providers have warned me directly the republican republicans, big beautiful bill, or what I call the large lousy law includes medicaid and aca cuts that will drive up costs, slash essential services, and push struggling communities into healthcare deserts. At loretto hospital in the austin neighborhood of chicago, 83% of patients rely on medicaid.
▶ 0:33:30In the face of republican cuts, hospital officials told me they may have to close programs to ensure they don't have to fully shutter the hospital. In benton, illinois, which is in southern illinois, I visited franklin hospital, where a fifth of the hospital's budget comes from medicaid reimbursements. Republican medicaid cuts will require them to provide care, quote, on a smaller scale so they can continue serving their rural community.
▶ 0:33:57On top of that, leadership at franklin hospital told me that if the medicaid cuts are significant enough, they would have to reduce staffing and reevaluate the services they can provide, and this will affect the entire rural economy. Republican health care cuts are going to close essential hospitals. And this is a map of 11 hospitals in illinois that are set to shutter.
▶ 0:34:20It's going to hurt everyone because it doesn't matter what health care status you belong to, health insurance status you belong to, if you use any of these hospitals and if they close, you will be negatively impacted.
▶ 0:34:35And so that's why we need to be concerned about this, uh, expiration of tax credits at the end of the year, but also the implementation of the large lousy law, because it will lead to a crisis in health care that is is eminently preventable.
▶ 0:34:52Today, if we can just marshal our energies and collective resources, we can pass an extension of the aca tax credits and prevent, uh, what would otherwise be a catastrophic situation for millions of americans. Thank you. And I yield back. >> thank you. Chairman grothman, ranking member frost and ranking member, christian krishnamoorthi. Um, I'm pleased to welcome our expert panel of witnesses.
▶ 0:35:19First, we have brian worley, who is the chief executive officer of patient technologies incorporated. Next to him, we have doctor darius lock. Lock duela lakdawalla, quintiles chair in pharmaceutical development and regulatory innovation and scientific and chief scientific officer, uh, schaeffer center for health policy and economics at the university of southern california.
▶ 0:35:45Next, we have doctor ziad obermeyer, who is a blue who is with blue cross of california, distinguished associate professor, health policy and management at the university of california, berkeley. And next we have Mr. chris jacobs, who is the founder of the juniper. Juniper research group. And finally, we have miss sophia tripoli, senior director of policy, health policy at families usa. Thank you to each and every one of you for being here today. I'm looking forward to your testimony.
▶ 0:36:14Pursuant to committee rule nine g. The witnesses will please stand and raise their right hand. Do you solemnly swear to affirm that the testimony that you're about to give is the truth, the whole truth, and nothing but the truth, so help you god? Let the record show that the witnesses answered in the affirmative. Thank you. And you may take your seats. We appreciate you being here. And let me remind the witnesses that we have read your written statement, and they will be they will appear in full in the hearing record.
▶ 0:36:46So please limit your comments to five minutes. Um, and the the light system is pretty self-evident. Green is go, yellow is wrap it up and red is is stop. I now recognize brian worley for his opening statement. >> thank you. My name is brian worley. I'm the ceo and founder of patient. I founded patient because I believe the most powerful way to remake the healthcare market and lower the prices we pay is by increasing and returning purchasing power to the one stakeholder in the system most sensitive to and capable of discerning value.
▶ 0:37:18And that's the patient. Our goal is to improve the ability of employers and patients to simply purchase and pay for care, ideally paying not just transparent, but transactable cash prices directly to providers whenever possible. We do that with help from pioneers like health equity and mark cuban cost plus drugs today. Today, we serve 6000 employers who want the capital efficiency of lower cost health plans, while ensuring that the 96% of their employees who never reach their out-of-pocket maximum, have an easier way to pay for care.
▶ 0:37:47We don't do this work alone. We're grateful for partners such as blue cross blue shield of arkansas, cigna, centene, gravy, sidecar health, humana and many others who've been investing with us for years to improve the affordability of the out-of-pocket experience for aca, governmental and employer health plan members and providers. I'm proud to say that patient also provides the software that powers the medicare prescription payment plan for nearly 22 million medicare beneficiaries.
▶ 0:38:14The medicare prescription payment plan is a bipartisan healthcare payment innovation that gives 54 million seniors the option for their insurer to pay their out-of-pocket costs. Up front. At the pharmacy counter, seniors receive a statement at month end to review for accuracy and then pay in full, like most do, or simply smooth the payment plan over the plan year to better fit their household budget.
▶ 0:38:37This innovation gives 54 million americans, seniors, financial security and the ability to personalize payment in a way that works for their budget. It's a pragmatic approach to make healthcare more accessible and affordable, and recognizes the ability to pay a $600 out-of-pocket expense is not the same for every senior. Importantly, this concept of cost smoothing it improves affordability without removing responsibility.
▶ 0:39:03This bipartisan idea is catalyzing change in the employer insurance market, where brokers, employers, and insurers are realizing that health plans that include cost smoothing create the ability to have lower cost health plans, coupled with better financial experiences for patients and providers, the market is moving toward these hybrid healthcare plans that have the efficiency of simply paying cash in full or over time for low cost routine care, coupled with the security and peace of mind of insurance coverage and payment
▶ 0:39:34Rails for rare care, please consider four suggestions to expand the use of this existing in market technology to immediately improve healthcare affordability one. Ensure seniors are automatically protected from unaffordable out-of-pocket costs by enrolling them in the medicare prescription payment plan. Every insurer in the country has successfully launched an operationalized m3.
▶ 0:39:55Seniors like the financial protection, convenience and ability to review their monthly statements for accuracy before they send in a check and pay for care plans can and should automatically enroll seniors in 2027. In m3, instead of laboriously requiring six seniors to call, opt in and potentially delay care, two encourage insurers to expand payment smoothing to include medical costs. Why should seniors only be able to smooth their pharmacy claims over time?
▶ 0:40:26Why not their larger, more costly and unpredictable medical expenses? Secondly, expand payment solutions, smoothing into aca and employer plans, providing real relief to 180 million people today to help this innovation. Uncompensated care from payment smoothing should be clearly characterized as the equivalent to a medical loss encountered below the line. Three allow seniors to access the benefit in real time. Seniors should be able to opt in in real time when they need help the most.
▶ 0:40:55When they're standing in a moment of uncertainty at a pharmacy counter, instead of waiting 24 hours and making a return trip to the pharmacy. Or not, this technology exists. The technology exists to allow seniors to opt in in real time or near time, allowing them to simply get their meds when they need to, and lastly, return the economic power to the people by allowing employees to receive and control more of their own health care dollars.
▶ 0:41:18Give employers and employees the voluntary option to receive the full cash value of what their employer would have spent on their health plan into a hsa or a roth version of hsa that they could use to invest in their health, purchase insurance, or simply indirectly pay transparent transactable cash prices directly to providers. Thank you for the opportunity to share my testimony. >> thank you, miss worley. I now recognize doctor lakdawalla for his opening statement.
▶ 0:41:50>> chairman. Burleson. Chairman grothman. Ranking member. Frost, ranking member, krishnamoorthi and honorable members of the subcommittees. Thank you for the opportunity to testify today about accelerating medical innovation through regulatory reform. The opinions I offer today are my own and don't represent the views of usc or the schaefer center. In 1965, the world's first beta blocker drug, propranolol, was readily available to patients in europe.
▶ 0:42:14Unfortunately, american patients would have to wait 11 years to fully benefit from this revolutionary treatment for cardiovascular disease. We now know that delay was deadly. Clinical trials show propranolol reduced stroke risk by 25%, and cut heart attack mortality by nearly 30%. Later, usc schaeffer research discovered this delay hurt the least educated households the most because they lacked the means for the complex diet and exercise regimens that served as the key alternative treatment option.
▶ 0:42:43Propranolol was not an isolated case. From 1972 to 1987, new drugs were twice as likely to launch overseas first. Then, in response to growing calls for timelier approvals driven by the aids crisis, the fda pioneered a series of reforms, including the fast track approval of hiv drug azt in 1987. Thanks to these and other forward thinking regulatory reforms, america is now the preferred launch market for breakthrough medicines.
▶ 0:43:11What's needed today is the next generation of forward thinking regulatory reforms that would encourage critical innovation and improve the health of american patients. First, medicare's coverage with evidence development program needs urgent reform, despite its name, speed limits both coverage and evidence development. Usc schaeffer analysis reveals how it creates stark disparities. Ced qualified hospitals are half as likely to treat patients that reside in rural areas.
▶ 0:43:43Similarly, they treat fewer low income subsidy enrolled patients and fewer patients residing in socioeconomically disadvantaged neighborhoods. Not only do these kinds of constraints reduce equitable access, but they also undermine a key goal of ced to generate evidence on a nationally representative sample of clinically eligible patients.
▶ 0:44:01Several steps could move ced in the right direction, developing a clear definition of cms reasonable and necessary standard, limiting coverage constraints only to those circumstances where clinical risks matter to patients, and providing transparent milestones that would end ced restrictions. Second, the current approach to medicare advantage risk adjustment weakens or sometimes even eliminates incentives for long term prevention.
▶ 0:44:26For instance, academic research shows that including pneumonia and risk adjustment coincided with reductions in the influenza vaccinations that help prevent pneumonia. That's because risk adjustment insulates insurers from the cost of long term illness, and eliminates their financial rewards from preventing such illness. On the provider side, alternative payment models also encourage short term thinking by limiting shared savings from prevention to just 12 month horizons.
▶ 0:44:55Treatment and prevention of obesity is a good example of long term thinking. Our research proves investing in obesity treatments for the medicare population generates at least a 13% annual rate of return greater than the stock market. This recent medicare coverage expansion for obesity treatments can help unlock this value, especially if coupled with a framework that encourages broader preventive investments.
▶ 0:45:17As usc schaeffer research has suggested, cms could allow multiyear enrollment in ma plans with premiums fixed over the enrollment period and set to reflect average growth in costs. Lengthening the payback period would align insurers incentives with the health of beneficiaries, especially because beneficiaries tend to stay with the same ma plan for about six years. Third, we must tackle healthcare's pricing opacity.
▶ 0:45:41Usc schaeffer research demonstrates that opaque pricing systems profit from complexity. Imagine grocery shopping, where price tags are removed and you receive one aggregated bill at checkout. You'd have no idea if milk costs $5 or $50. That's american healthcare. Today. The economic logic is clear. When buyers can't see prices, sellers exploit that blindness in healthcare, and segregated payments and complex billing hide true costs.
▶ 0:46:10This isn't just inefficient. It's a transfer of wealth from american families to healthcare intermediaries who profit from confusion. American patients deserve a healthcare system that delivers breakthrough innovations efficiently, equitably and transparently. These reforms can deliver that system, but only if we act decisively. Thank you. >> thank you. I now recognize doctor obermeyer for his opening statement. >> thank you for this invitation to testify.
▶ 0:46:40I am a physician and a researcher at berkeley, where my focus is on artificial intelligence applied to health. I'm also the co-founder of a company called dandelion and a nonprofit called nightingale open science, both of which are dedicated to accelerating the development of health ai. Every time a new technology comes around, somebody says, this time is different. But when it comes to health care costs, new technology always seems to increase them.
▶ 0:47:05That's because the technology is expensive, but also because the more choices we have of technology, the harder it is to make good decisions. And that leads to waste and poor quality. So I'm going to tell you that artificial intelligence is different and you should be suspicious. But let me try to convince you. The reason is because ai is a tool for making better decisions, and that's how it can give us a rare two for one opportunity to reduce the cost of care and improve the quality at the same time. Let me give you an example.
▶ 0:47:36Every year, 300,000 americans drop dead suddenly because of cardiac arrhythmias. As an emergency doctor, I've seen too many of those patients. And I'd guess some of you in this room also know somebody. What makes these deaths so tragic is that we have a cure. A defibrillator implanted into the heart could save those lives. But doctors have trouble deciding which patients should get a defibrillator. And that means a lot of people die without a defibrillator. But it means something else, too.
▶ 0:48:02Two thirds of the defibrillators that doctors actually put in never fire, never deliver a life saving shock, because the patients we thought were at high risk aren't at high risk and never go on to develop those arrhythmias. That's a $50,000 procedure with real risks. But in this case, zero benefit. My colleagues and I have built an ai system to help solve that problem. It looks at a patient's electrocardiogram and estimates their risk of sudden cardiac death.
▶ 0:48:28And our early testing shows it does so far more accurately than what doctors are currently using to decide. We're already starting to test that system, working with an incredible team at providence saint patrick's hospital in missoula, montana, and rural hospitals around there to get defibrillators to people who need them and spare the hearts and the pocketbooks of those who don't. If saving lives and cutting wasteful spending sounds good to you, there are a few ways that the federal government can help. First, data access.
▶ 0:48:55When I started this work, it was so difficult to get the data that we needed here in the united states that I ended up doing this research in sweden. That process took ten years, but it was still faster than doing it here, despite european data regulations. That is a real problem for patients who don't know that they're at high risk, and a problem if we want the united states to lead in health. Ai. The major culprit here is the many layers of permissions and approvals required to touch health data.
▶ 0:49:22Most of that burdensome paperwork does not actually keep patients or their data safe, and it also opens the door to ideological bias. The paperwork is used to decide which questions get asked and which don't. Instead of assuring that any question can be asked in a safe and ethical way, concretely, federal agencies that hold health data should set clear targets for delivering it.
▶ 0:49:44Hhs should also greenlight modern technical tools for rapid de-identification of ai ready data like images and notes, and onc should prevent vendors from locking up those data with fees and delays. None of this means compromising privacy or safety, in fact, just the opposite. Adopting modern data management methods can increase speed and access while improving safeguards. Second fda evaluation. Today, we regulate artificial intelligence under statutes written in 1938, which treat it as a medical device.
▶ 0:50:14But ai is quite different from a thermometer. Ai makes predictions about measurable outcomes, and that gives us a simple and rigorous way to evaluate it. Does ai predict what it's supposed to predict in populations that look like all of america? The fda should put that question at the center of its approach to ai and build or partner on data infrastructure for rigorous, independent evaluation. That transparency is essential for rapid progress and for catching problems like algorithmic racial bias, as I've shown in my prior work.
▶ 0:50:42Third, cms should pay for ai that does good. The private sector is currently underinvesting in ai tools because of deep uncertainty about what payers will pay. Cms has the power to shape that, and the new access model is a promising new step in that direction. But cms should go further by creating payment codes for ai tools that are shown to improve outcomes, reduce costs, and detect fraud and abuse.
▶ 0:51:06As my five minutes draw to a close, three americans have experienced sudden cardiac death since I started to speak. They might still be alive if my data access had taken nine years instead of ten. Speed is important for patients. It's also important for the fiscal health of the united states, and it's important because we're in a race. We have a head start in that race with great data, world class universities and purchasing power.
▶ 0:51:29And if we make it easier to use data, regulate well, and pay for high value tools, we can reduce costs, save lives, and secure american leadership in ai. >> on the dot. Doctor obermeyer and I recognize Mr. jacobs for his opening statement. >> thank you. Chairman burleson and grothman ranking members frost and krishnamoorthi, members of the subcommittee. Good morning. Thank you for inviting me to testify.
▶ 0:51:53My entire written statement is before you, so I will not repeat it, but instead make three main points regarding healthcare costs and insurance coverage. First, obamacare has not met its stated objectives. The law singularly failed to achieve candidate obama's 2008 promise that his healthcare plan would, quote, bring premiums down by $2,500 for the typical family, end quote, individual health insurance premiums more than doubled in the law's first four years of full implementation, and
▶ 0:52:24Continue to rise faster than premiums for employer sponsored coverage. Meanwhile, the law encourages insurers to avoid the sickest patients, often harming those at most intended to help. Second, despite what some may believe, there's a surprising amount of consensus bipartisan consensus about the law's failure to control health care costs.
▶ 0:52:44Two years ago, senator elizabeth warren coauthored a letter noting that obamacare's medical loss ratio provisions have encouraged insurance companies to acquire other businesses, like pharmaceutical benefit managers, and to overcharge patients through pbms to shift profits from their insurance business, where obamacare caps their profits to pharmacies and other businesses without such restrictions.
▶ 0:53:08Indeed, healthcare has only become more consolidated since obamacare's passage, with hospitals and health insurers buying up physician practices and each other to gain additional market clout. Provisions like the mlr have led progressives to write analyzes discussing, quote, how obamacare created big medicine. End quote.
▶ 0:53:28A separate academic study concluded that the 340 b prescription drug discount program, which obamacare greatly expanded, raised exchange benchmark premiums by 1.8% in 2024, resulting in $2.2 billion in additional federal spending on insurance subsidies.
▶ 0:53:48Third, as to the enhanced premium subsidies expiring on december 31st, this republican congress should follow the example democrats set regarding the child tax credit in 2021 and allow this temporary covid era policy to expire.
▶ 0:54:01The myriad studies regarding fraud on the exchanges, including last week's government accountability office report, demonstrate why washington should not spend 350 billion taxpayer dollars, plus interest to mask flaws in a law that has made health care less affordable thus far.
▶ 0:54:19During open enrollment, 400,000 more people have signed up for exchange plans than did so at the same time last year, notwithstanding the impending expiration of the enhanced subsidies, these preliminary data suggest that the worst case scenario cited by enhanced subsidy supporters have not come to pass, reinforcing why congress should let them expire.
▶ 0:54:42Instead, lawmakers should pursue alternative policies that will enhance insurance portability, realign incentives, and promote price and quality transparency. Thank you very much for the opportunity to testify, and I look forward to your questions. >> thank you, Mr. jacobs. I now recognize miss tripoli for her opening statement. >> chairs cramer, glenn grothman and burlington ranking members garcia, frost and krishnamoorthi and members of the committee.
▶ 0:55:08Thank you for the opportunity to testify today on behalf of families usa, a leading national, nonpartisan voice for health care consumers. I want to thank you for this critical discussion. The united states is in a full on health care affordability crisis, and our nation's families are breaking under the weight of it. We all see it. Parents who can't afford the treatment their kids were prescribed, families delaying care because their deductibles wipe out their savings. Workers who technically have insurance but can't actually afford to use it.
▶ 0:55:36Employers who want to offer good insurance but are being crushed by rising premiums, and federal and state lawmakers in gridlock over how to balance budgets and which services to prioritize. Today's focus on technology is important given the rapid advancements in technology over the last century, which has revolutionized health care delivery on everything from reducing medical errors to strengthening diagnostics and treatment protocols, to streamlining eligibility and enrollment determinations for coverage.
▶ 0:56:01But it's important to note that while technology is a critical tool that can drive innovation and increase efficiency with appropriate patient protections in place, it is not a replacement for comprehensive, affordable health insurance. People without insurance are in no position to benefit from healthcare technology and technology itself does not address the core drivers of unaffordable care. The trajectory of health care costs in this country is unsustainable for consumers, for the public sector and for the private sector alike.
▶ 0:56:27But this is not caused by people using too much care or because immigrant families need health care. Our affordability crisis is caused by corporate health systems, whether it's big insurance giants, drug companies or corporate hospital chains charging excessive prices that have absolutely no relationship to health care quality or outcomes, and with no accountability from lawmakers, these excessive prices generate record profits for these corporate health systems, all on the backs of the millions of americans who can't afford to buy groceries
▶ 0:56:58Or pay rent because of rising health care costs. But instead of taking on the corporate price gouging at the core of our nation's affordability crisis, this congress cut $1 trillion from the very programs built to provide a safety net and ensure access to affordable care, and has so far failed to extend the enhanced premium tax credits that keep coverage affordable for 22 million americans.
▶ 0:57:18Poll after poll confirms that heading into 2026, voters want lawmakers to address health care costs above all other priorities jobs and unemployment, immigration, crime and the budget deficit. 91% of the american people, from conservative republicans to progressive democrats, are begging this congress and the president to lower their health care costs, not strip away their only lifelines to more affordable coverage.
▶ 0:57:44Voters want congress to rein in the corporate profiteering, making healthcare unaffordable, and your decisions have real life consequences for everyday americans. For people like tony gonzalez in pennsylvania, who was fighting cancer and can only afford the treatment keeping him alive because of premium tax credits, and eric williams, a small business owner in utah who needs regular infusions to stay alive, costing $150,000 a year without insurance, enhanced premium tax credits are the only reason he
▶ 0:58:16Can afford his life saving care. And cassandra nelson in rural georgia, who cares for her daughter with type one diabetes and seizures and has been crushed by the weight of medical debt and the dread of wondering whether she can afford the care her child needs. These families and millions more across the country are doing everything right and playing by the rules, yet stand to lose everything in a system that is rigged against ordinary americans and built to fuel corporate greed.
▶ 0:58:40As challenging as this moment appears in our nation's history, there is good news. We already know the solutions that will lower healthcare costs and hold corporate health systems accountable for charging excessive prices, driving our nation's health care affordability crisis.
▶ 0:58:55The solutions are to immediately pass a clean extension of the enhanced premium tax credits, to enact site neutral payments to stop big hospital systems from charging medicare more for the same procedure if it's performed at a hospital instead of a doctor's office, to allow medicare to negotiate prices on more drugs, and closing legal loopholes that allow drug companies to block lower cost drugs from coming to the market.
▶ 0:59:21To stop medicare advantage companies from exaggerating patients health risks, just to get paid more, and to scrutinize the growth of private equity and the monopoly power of big corporate health care chains that drive up health care prices for all of us. These policy solutions are wildly popular and garner almost no opposition from voters across political parties.
▶ 0:59:43The american people are fed up with the broken health care system, and they are frustrated with politicians who choose to play politics with their health and financial security. Instead of delivering meaningful reforms. We appreciate today's discussion on technology and its role in potentially reducing costs, and the opportunity to draw attention to the healthcare affordability crisis. Congress has the power to advance policies that will lower healthcare costs and hold corporate health systems accountable for our nation's affordability crisis.
▶ 1:00:11We urge you to take action. I thank the committee for your time, and I look forward to answering your questions. >> I'm very thankful for the opportunity to co-chair this subcommittee hearing, along with my colleague, chairman grothman. I want to thank again the witnesses for being here today for this important issue. Um, unnecessary government regulation is an obstacle to developing innovation, healthcare technology.
▶ 1:00:37This is technology that, uh, will will not only. I'm sorry. I'm supposed to recognize myself for five minutes. I'm yielding to myself for five minutes. Unnecessary government regulation is an obstacle to developing innovation. Healthcare technology. Something that I worked in for almost 22 years. Um, this is technology that will, if left alone, will lower costs and improve patient outcomes and save lives.
▶ 1:01:04But bureaucrats often step in, step in the way, just like the biden administration did when they attempted to force a one size fits all approach to the health care sector, while failing to consider what's happening at the local level. While I served in the missouri legislature, I introduced a plan that was called the health care compact. Trying to get wrestle that one size fits all authority back to the states. Um, and I'm pleased today that I have another fellow missourian who is who is thinking outside the box, Mr.
▶ 1:01:34Worley, um, on how to address the health care, um, costs for for patients. Mr. worley, what have you found to be the greatest obstacle in your business to develop new, this new kind of way in which people can pay? >> every single day? Uh, we're motivated by one single goal, and that's to help people better access informed care.
▶ 1:01:57Uh, we employ a team of incredibly talented people to give, to make the to make the unsure, uncertain moment that facing americans all across the country something of the past. And so we want to give people the confidence, the ability and the dignity to easily and effortlessly access and pay for care. Um, I think, um, our biggest barrier to that is just the inertia of the status quo.
▶ 1:02:24And, um, um, moving that up uphill, uh, requires the best efforts from all of us. >> would you say that the status quo is propped up by the regulations that this town has created, that really kind of that stop, stop innovation like yourself, like your what your company has provided?
▶ 1:02:44>> I think you know, the degrees to the extent that we can, um, you know, the best regulation is, is probably, uh, no regulation, the ability for us to innovate and have degrees of freedom to respond to the market and, and respond to the customers and partners that we serve. Um, that's what we're attuned to.
▶ 1:03:07>> and how would you how would you say that your business under the previous administration, now that you've had ten months under this administration, have you have you recognized any kind of change. >> in 2025 has been a transformational watershed year? Um, in that we have enabled, you know, nearly 20 million people to more easily access and afford care.
▶ 1:03:28Uh, we're providing people the peace of mind and certainty and ensuring that that unsure, uncertain moment that they're standing in a pharmacy, um, is something of the past. Uh, we're giving them the ability to take care of themselves and their loved ones. And that is with the launch of the bipartisan medicare prescription payment plan. >> thank you, Mr. jacobs. Um, how has the affordable care act caused health care to actually be unaffordable? >> uh, thank you, Mr. chairman.
▶ 1:03:56It's really encouraged consolidation within the health care sector. I talked to my, uh, both my prepared testimony and my written comments about how the medical loss ratio encourages consolidations, that we essentially have healthcare oligopolies now, uh, that encourage insurers to buy pharmaceutical benefit managers and other forms of businesses where they could offload and shift their profits. >> vertical integration. Correct forced vertical integration. >> and there's also vertical integration within within the hospital sector. Um, Mr.
▶ 1:04:24Polis statement noted the significant amount of hospital mergers that have taken place over the years, and I believe, uh, said that 40% of those occurred between 2010 and 2015. Well, there was a law congress passed in 2010. It's called obamacare.
▶ 1:04:42And to say that that did not have an impact, I think it very clearly did have an impact, whether it's accountable care organizations that entities wanted to purchase physician practices, they wanted to purchase each other to get additional market clout, uh, to, to negotiate more power to negotiate with the insurers across the table from them. >> yeah. Mr. obermeyer, um, you you addressed that.
▶ 1:05:09In order to move forward, you need access to data. Um, one of the previous bills that was passed before obamacare was passed was actually to create these health information exchanges. But in my opinion, having worked in that space, it's been an abysmal failure. It does not work. It does not benefit patients. The data doesn't go from doctor to doctor. And then to hear that you say that it's not even accessible for research, um, you know, anonymized. This is something that we have to get our hands on.
▶ 1:05:39Um, particularly if ai is going to be moving forward. Um, and I worry about what? About where we are with that. How do we how do we address that? By properly with in, in a way in which we can still properly secure somebody somebody's health information? >> we're used to thinking about a trade off between how easy it is to access the data and how safe it is. I think that trade off is largely a product of using old technology and old data management systems.
▶ 1:06:07The most sensitive data in the world are kept on modern systems that let people access it when they need it and keep out others. I think paired with a strict approach to law enforcement, we can have the best of both worlds. >> thank you. I now recognize Mr. frost for his line of questions. >> thank you so much, Mr. chairman, and thank you so much to our witnesses for being here. Uh, Mr. worley, you were chatting a little bit about, um, in the last question line, um, that you guys were able to help 20 million people in 2025.
▶ 1:06:36How does that compare to other years with your company? >> uh, it's an it's an enormous step up. So on january 1st, 2020, january 1st, 2025, it was the launch of the medicare prescription payment plan that gave nearly 54 million american seniors with part d coverage the ability to more efficiently and effectively get care and move their costs over time. >> yeah. Thank you. Um, so how would you describe the demand for your services? >> it's increasing. >> okay.
▶ 1:07:02Um, if if more people have to opt in for worse health care plans, higher deductibles, um, different things like that, would that also increase demand? >> yeah, the demand is increased as insurers and employers are recognizing that they can have both a lower cost health plan and compassionately ensure people can access care. Um, it's a pragmatic approach, enables people to get the care they need and pay for that care at no. >> I appreciate it.
▶ 1:07:31And so your company, you know, essentially what you make money helping people to pay their health care bills in a more smooth way. Um, if there are more people who cannot pay for their health care bills at once, will there be more demand for software like yours? >> yes. >> and if healthcare becomes more affordable, if we had, let's say, you know, my north star single payer health care, something like that. People didn't need to enter payment plans for healthcare. Um, there probably wouldn't be as much of a and for the services, right?
▶ 1:08:00>> no, I think that, um, that, you know, the north star and what affordability is that affordability is an emotion. It's the ability to take care of yourself. Um, and what we do is we give people the financial ability to manage whatever financial, um. >> whatever the costs are. >> yeah. May, may well be. >> no, I appreciate that. I'm not. And I'm not trying to paint you as a bad person or anything.
▶ 1:08:27Um, it's to make a point because you're a serial entrepreneur who, um, finds a problem, right? And figures out a solution. And that's your prerogative, right? And we do have a problem. Healthcare is too damn expensive. The cost of healthcare is too high. And I would submit that part of the reason why there's such a bigger demand for your services than ever before is because the cost of healthcare is going up and up and up. Um, and that's why I'm confused on why my republican colleagues have you as a witness here on this, uh, panel about affordable health care.
▶ 1:08:56Not a dig at you personally, but because I think it shows because there's so much more demand for companies like yours. It shows that we're failing in congress. And whatever policies are being done right now are not helping people afford their health care and bring down the cost of health care. We're here to talk about bringing down the cost of health care. And if you can't afford to get it right when you receive that bill, it means you can't afford it. My dad was always strict with money. He always told me if you couldn't afford it when you got it, you can't afford it at all. Right?
▶ 1:09:25If you have to buy now, pay later, you can't afford it. And that's part of the issue. And I think it makes sense why more people need services like yours is because health care is too damn expensive, and president trump and congressional republicans are making it worse. And that's why I come back to this extension of the affordable care act. Tax, uh, subsidies. We have just five weeks until the aca open enrollment ends, and in five weeks, 189,000 people in my district alone are going to see their health care skyrocket. I can't tell you how many of my own friends and family have called me saying, what the hell?
▶ 1:09:56What are you guys going to do about this? I mean, I used to pay this much and now I'm going to be paying this much. I can't afford it. Um, and this is going to happen to 25 million of our people. That's why I keep coming back to this, because there's something right in front of us that has to do with affordability. I want to talk about the subject of technology and ai and healthcare. I think this is an important hearing to have. But right in front of us, we have a cliff that's coming up.
▶ 1:10:20And if we don't do our job, more people are not going to be able to afford their health, health care, and more people are going to have to do buy now, pay later plans to be able to pay to stay healthy in the richest country on the face of the earth, which I think is disgusting and I think is a failure of our government. Miss tripoli, if the subsidies expire, how will this impact how often people go to the doctor, how sick they get and how much debt they have to take on? >> thank you for the question.
▶ 1:10:48If the subsidies expire, we will see premiums more than double. For some families, we'll see increases of 300%. Uh, for older couples, we will see, uh, making just above the 400% of poverty. We will see them paying about a quarter of their income on health care costs. We know in the midst of an affordability crisis that, um, it's unaffordable. It will force people to, uh, forgo care, um, drop out of coverage if they have to.
▶ 1:11:12And of course, when folks drop out of coverage, we know that they don't go to the doctor, they delay or they end up in the emergency room, which is the most expensive care setting, um, to get health care. >> and if we have folks who say, you know what, I disagree with a lot of different parts of our health care system. Look, I know we have a broken health care system, but we have this this clock ticking, this countdown timer in front of us.
▶ 1:11:35Would you advise us to let that countdown end and have health care go up for so many working families while we try to figure out a plan that no one really has right now? Or would you say that we deal with what's right in front of us and then have those conversations? >> time is of the essence. The first thing you do when somebody is bleeding is you stop the bleed. The tax cuts need to be passed with the clean extension immediately. It's a lifeline for 22, 24 million americans.
▶ 1:11:58And then let's come back to the table and talk about how we address the root drivers on drugs, on hospitals and others to bring down the underlying cost of care. >> that's why we have to pass the extensions for the affordable care act, because our people are suffering right now. The cost of everything is too damn high, and if we don't do our job, 25 million americans are going to see their health care go up anywhere from 50 to 300%. Then let's get back to the table and figure out what we do to fix this broken health care system. I yield back. >> thank you.
▶ 1:12:27Have a document to submit for the record from the juniper research group titled no, obamacare premiums are not doubling in 2026 that I'm submitting for the record. Without objection. And with that, Mr. chairman, I. >> request unanimous consent of uc. Of this document. >> you're recognized. >> Mr. chairman. I ask unanimous consent to enter to the record fact sheets from keep americans covered. That shows that my republican colleagues on this committee represent 738,000 people who depend on the affordable care act tax credits.
▶ 1:12:58>> without objection. I now recognize I'd. >> like to submit for the record. >> yes. >> Mr. um, uh, cms, uh, fact sheet. Um, with regard to historical national health expenditure data and an ama fact sheet on trends for health care spending. >> without objection. >> thank you very much. >> now, recognize Mr. grothman.
▶ 1:13:22>> okay, first of all, I'm grateful, uh, for an opportunity to have this hearing with my co-chair and want to thank the witnesses one more time, uh, for coming over here. A few weeks ago, the health care and financial services subcommittee held a hearing where we heard from the trump administration about the youth health care crisis. Not only are our children facing chronic diseases as rates never seen before, but the health care system seems to only get more expensive without any noticeable improvement in outcomes.
▶ 1:13:50Recent data published by the trump administration and and confirmed by several other independent sources, indicate that one third of health care costs are wasteful and don't improve patient health. Um, I'm going to throw we'll start with Mr. jacobs. Uh, why are one third of health care costs wasteful and fail to improve patient health? Do you believe that's true? >> I certainly think there is a great amount of waste in in in the health care system.
▶ 1:14:21Unfortunately, we we as I mentioned in my testimony, we don't have correctly aligned incentives. Uh, everybody, if you know, the traditional example is the all you can eat buffet, everybody does a good job of spending everyone else's money in health care. Now, obviously there are circumstances you're not going to, you know, try to shop for care when you're in an ambulance on the way to the hospital or anything else like that.
▶ 1:14:44But we, we, we do need to realign incentives at the margins to show where, where people can be smarter shoppers of health care. But first, that requires price and quality transparency. I've had personal difficulties myself on numerous occasions finding out what the heck things cost. >> I'll give you guys another question and anybody can jump in here. Utilization rates vary from doctor to doctor and state for state.
▶ 1:15:08Uh, does anybody want to comment on that or have any information on examples of over utilization which would indicate that more is being spent than has to be spent? >> well, chairman rothman, one issue is that if you look at that variation from state to state, it tends to be greater in medicare than it tends to be in the commercial insurance market.
▶ 1:15:32Um, and I think that indicates that when there's oversight in terms of what's valuable care, um, it helps to mitigate overuse. Examples of overuse. Uh, prominent one is what's known as defensive medicine. So it's testing that's undertaken because of malpractice risk. Probably adds our research suggests around 10% to medical spending. So that's one important source as well. >> okay. And that varies from state to state. >> it does, yes.
▶ 1:16:01>> give examples of a high state and a low state or just a shot at a specific example of dramatically higher costs in one state than another state. >> typically, the states that um award higher jury awards and malpractice cases tend to have more defensive medicine. >> okay. Yeah. Um, I think we can all agree we have a problem when one third of health care spending, according to some people, goes to waste.
▶ 1:16:29Can you explain why that is such a problem and how it affects the health care market? Mr. laurel lee, I guess we'll start with you. >> yeah. Health care costs are a combination of the volume of care we seek and the prices we pay.
▶ 1:16:44Um, you know, enabling people to pay the price and enabling more and more cash prices and direct prices for there to be a single price for all versus a single payer for all, enabling people to actually know what the price is ahead of time, the real price, um, that intermediaries or ai can't reprice. Um, that's important to enable patients and employers, purchasers of care uh, to give signal. Is it the right price?
▶ 1:17:12Um, I think it's important that, um, in terms of the volume, whether there's overconsumption, there's also underconsumption in the market as people are unable to pay for care. Uh, that's why nearly 30% of aca markets have built, um, uh, solutions like patient into aca plans to ensure that people are able to get care, uh, when it happens, because health care is a necessity. >> okay. Uh, what I'll do is I'll go down the line, starting with Mr. lakdawala.
▶ 1:17:42Um, how have you personally experienced rising health care costs in your individual field or from the perspective that you're in right now? And specifically, what would you like to see congress do to rein in those costs? >> um, I would like to see, um, attention paid to measuring the value of different health care procedures, drugs, devices and the like, and ensuring that we're not continuing to continually investing in low value care, which is happening.
▶ 1:18:14Um, for example, uh, most most americans say they don't want to die. They don't want to spend their last days of life in a hospital. Yet a majority of individuals end up there. That's wasteful care because it's not aligned with what patients value and their families value. >> in other words, people are well, we'll go ahead. I'm running out of time, so we'll go down the line.
▶ 1:18:37>> I'll just tell you one fact from my own experience as a physician, I've ordered a lot of wasteful tests, for example, in the er, tests for heart attack that expose patients to risk and costs and come back negative at the same time. Heart attack is one of the most common reasons that doctors get sued because we miss it. And so even though, of course, there's a lot of contribution from incentives, fear of malpractice, the core of the problem, at least from my perspective, is that it's really hard to make decisions about who needs care.
▶ 1:19:05And I think that's why I'm so optimistic that artificial intelligence can help us make better decisions and thus reduce the costs of care, but also improve the quality by taking some of those costs and giving it back to patients who need the care. >> Mr. jacobs. >> as an exchange customer here in in in dc, who's facing a premium increase in starting next month. Um, I certainly understand the cost because I have to pay all of those out of pocket. I'm I'm self-employed, so I don't I don't have an employer to subsidize.
▶ 1:19:33Um, I actually agree with Mr. polly, I think site neutral payments and there's a good amount of bipartisan agreement on this is, is a good policy that congress should should be enacting. I just recently went to a specialist for a second opinion on on an orthopedic orthopedic issue, and I ended up paying twice what I normally pay at my at my usual specialist, primarily because the second opinion was affiliated with a hospital and it's a physician office visit, but it's billed through a different service.
▶ 1:20:05It's billed as an outpatient clinic visit, and so I pay twice as much. Uh, we shouldn't be inviting these kind of disparities and then encourages more physician practices to merge with hospitals because they can charge more. >> we're going to break the rules and ask the final question to miss tripoli, the democrat witness. >> uh, well, I actually agree that the underlying incentives, the incentives of the health care system are misaligned.
▶ 1:20:29All the incentives are to get bigger and bigger and to charge more, uh, volume of high priced services, rather than making sure that people are getting the high value care that they need to get healthy and stay healthy. And so I do think that there's a longer term conversation about how do we structurally realign incentives with the health and financial security of the american people. But I will tell you that it's very hard to have that conversation when you've got 22 to 24 million people right now who need the enhanced premium tax credits extended. And so that's the lifeline they need today.
▶ 1:20:58And then I encouraged congress to have a conversation about how to realign payment systems in the health care system. Absolutely. >> do here. Thank you. >> thank you. I now recognize ranking member krishnamoorthi for his opening statement or for his line of questions. Thank you. >> I can do that, too. Thank you. Uh, thank you, Mr. chair, and thank you to the witnesses. Your your answers have been very thoughtful, and, uh, I really appreciate your participation, miss tripoli.
▶ 1:21:24I want to share the story of, uh, the family of a woman named crystal from central illinois, which is where I'm from. She's in contact with my office. And here's a picture of her three children, uh, who have some medical, very complex medical issues. After growing up in medicaid, crystal finally secured a job with employer health coverage.
▶ 1:21:48But the plans cost for her three medically complex children were so high, the employer sponsored coverage was effectively unusable. With the aca's enhanced premium tax credits. However, she can instead buy coverage for her three children at $800 a month on the exchange.
▶ 1:22:08Now, if we let those tax credits expire, her premiums will nearly double to $1,400 a month, trapping her in a coverage gap. Miss tripoli the medicaid coverage gap, which crystal is experiencing, affects millions of americans who earn too much to qualify for medicaid, but not enough to afford private health insurance coverage. That's why the tax credits were created in the first place, to enable people to afford, like Mr.
▶ 1:22:37Jacobs and and others, uh, the health insurance that's available on the exchanges. And Mr. jacobs, I'm also on the exchange, like yourself. Um, so here's my question to you, miss tripoli. Unfortunately, crystal doesn't have an extra $600 a month to pay for her insurance. So to get out of the coverage gap, she would be forced to leave her job so that her kids can qualify for medicaid coverage.
▶ 1:23:04Because the only alternative to risking their health, um, is is basically, um, basically going without coverage, which is a choice no parent should ever have to face. Miss tripoli. Crystal story is not unique, right? >> it is absolutely not unique. And you're highlighting the exact reason why we need the enhanced premium tax credits extended immediately, not to mention the challenges that were imposed from h.r.
▶ 1:23:29One in terms of medicaid work reporting requirements and how difficult it will be for people to meet who are working. But to meet those requirements under the new federal rules. And so there's absolutely a need for families like crystal. And there are millions of families like hers across the country to get the relief they need right now. And that's through extending the enhanced tax credits. >> folks, as we approach the holiday season, please keep in mind families like crystal's.
▶ 1:23:51I mean, we have to extend these even if we are going to negotiate future iterations of these tax credits. Let's do the humane and right thing, which is to extend these tax credits for some period of time while we negotiate the rest of the aca. Mr. jacobs, um, you recently wrote this article entitled, quote, the middle class can't keep up with persistent inflation forever, right?
▶ 1:24:20Yes, it was from december 1st of this month, right? That's correct. You wrote, quote, american households feel stuck in an ever growing vise by prices rising faster than their incomes can keep up. Correct? Yes. Donald trump recently claimed that the affordable affordability crisis, a quote hoax you wrote in this article. And I agree with you, quote, trying to claim inflation doesn't exist won't cut it, correct? Sure. You also wrote, quote, I see it every week when I go to the grocery store.
▶ 1:24:49I consider myself luckier than most, but the weekly shop still still feels painful. That's what you wrote, right? Yes. You also, in part, blame trump's tariff policy for high prices on things like bananas and coffee, writing, quote, it seems foolhardy ever to have imposed levies on items that our climate won't allow us to grow in sufficient quantities domestically, but at a minimum, ending the tariffs will provide a bit of relief. That's what you wrote, right? >> that's correct.
▶ 1:25:18>> despite controlling the house, the senate and the white house, republicans have done nothing to bring down high prices. On the contrary, your article title could not be truer. Mr. jacobs, the middle class cannot keep up with persistent inflation forever. President trump's tariffs only make them worse. Now, let me turn to my final topic. And that's ai. Miss tripoli. Ai has become increasingly prevalent in healthcare settings.
▶ 1:25:42In fact, a recent study from rand brown university and harvard found that 1 in 8 adolescents and young adults use ai chat bots for mental health advice. You don't dispute they found that, right? >> no. Do not. >> time magazine recently reported that when asked about self-harm, some of these bots have offered guidance on how to, quote, safely cut oneself or what to include in a suicide note. Miss tripoli.
▶ 1:26:09Again, this is what time and other news outlets have been reporting, right? >> correct. >> my home state of illinois has banned ai chatbot from offering any kind of psychotherapy for anyone. Other states have similarly instituted different guardrails for ai.
▶ 1:26:28Unfortunately, there's a move currently from the white house to preempt all state laws with a national law preventing this type of legislation that illinois and other states have instituted or enacted to put guardrails on ai. Doctor obermeyer, your testimony today, and I read we read through your testimony, does not endorse preemption and in fact, does not even mention it. Correct? >> correct. >> Mr.
▶ 1:26:54Chair, the majority's own witness did not mention preemption in his testimony because it premature. There are great things happening in red and blue states alike that are protecting our children. We have one of the few chances right now to come together and say no to a really hasty national preemption plan that the white house is initiating, and I hope we don't lose that opportunity to work together. Thank you. And I yield back. >> thank you, chairman grothman.
▶ 1:27:26Um. >> I'd like to submit another document for the record called how much does that mri cost? Uh, put together by healthcare, uh, unleash prosperity. I want you all to look at it. It shows similar procedures varying from 300 to $7500, depending upon the provider. >> thank you. Without objection, I now recognize Mr. maguire for his five minutes of questions. >> thank you, Mr. chairman. And thank you to the witnesses for being here today. The tariffs, by the way, I heard I heard mention of tariffs.
▶ 1:27:56Tariffs are working for the first time in a decade. We have a surplus. That means our government has been spending more per month than we bring in per month. If you ran your house like that, you'd be on the street. And if you ran your business like that, you would be out of business. Now the tariffs are important. I mean, american steel is back. Bigger contracts that we've ever had. You can't do anything without steel. And gas prices are coming down because we're drilling more today than we ever have.
▶ 1:28:24In fact, in roanoke, virginia, this weekend, someone sent me a screenshot at the pump under a dollar, under $2 gas. I think it's 235 today, but still, we haven't seen prices like that in five years now. We got into a big mess over the last four years, and we've only been here about 11 months or so. It takes a while to turn the ship, but the one big, beautiful bill puts jet fuel on our economy. And hopefully by the spring you're going to see this. The problem is the government doesn't do a whole lot right.
▶ 1:28:53If they built you a car, it would cost $1 million and you probably would be a year or two late in getting it and it would fall apart. That's why we need free market competition. You've heard about kopn, a certificate of public need. It's like there's a monopoly and a control from those in charge. And if we had free market competition, it would drive down prices. I think the first calculator was this big. It was $5,000.
▶ 1:29:20But with innovation and free market competition, it got better and smaller and better and smaller. And now you can buy a calculator for $1 at the dollar store. We have not been allowing competition because the government is involved. And again I can talk about the us post office. I talked in my district. We have health clinics, 41 I think in several hospitals. And I asked them, you have to deliver medications every week to people that rely on these medications for life or death.
▶ 1:29:48Do you use the us postal service? And they said, no, we use fedex and ups. And I said, how reliable are they? They said, 100% reliable. And I said, how reliable is the post office run by the government? And they said, not reliable at all. We can't use it. I said, well, give me your worst case example. And they said, well, we mailed some medicine in 2013 and we got it returned to us in 2023. And so I think the big problem with the cost overrun is obamacare. For example, they call it the affordable care act.
▶ 1:30:20I would call it the affordable care act because it took away the free market competition, and it totally benefited the insurance companies. And they can charge whatever they want. When talking with hospitals about cap'n. A doctor would say to me, hey, I want to start in a rural virginia far away from a hospital. I want to start a mri clinic because I can do it for $500 a piece. Or you can go to a hospital and spend 1500 $2,000 a piece. Sounds like common sense, right?
▶ 1:30:49But then the folks at the hospital said, well, the problem is there's a lot of things we do at the hospital that don't make money. So then at the hospital, we charge a whole lot. So to make up for the programs that don't make money. So again, if it's nonsensical, it is a mess. And we need free market competition. We also need a preventative health care system. You know, when you buy a car, it tells you at 2000 miles, do this at 5000 miles, do this at 15,000 miles, do this.
▶ 1:31:17We seem to have a system where you put band-aids on it and wish and hope and wing it and modify it, and it doesn't work that way in the business world. You would be out of business if you didn't have some sense. And for example, would you rather find a tumor when it's this small or when it's this big? And if you had a system of checkups and things like that, but be that as it may, we are where we are. And so I guess what I would ask is we don't have a lot of time. Let's get some yes or nos.
▶ 1:31:44Do you agree that a productive rather than reactive system would help us shrink government and it's just a yes or no? I don't have time. >> yes. >> yes, an ai can help. Sure, yes. Yeah, I totally agree with that. And for all the witnesses. Yes. Do you agree that more competition in medical tech will lead to better outcomes for patients? Yes or no? Because I don't have time. >> yes yes. >> more competition is always good. Yes. >> I like it, I like it.
▶ 1:32:14All right, all right. I'm also hopeful that data driven approach to healthcare can help speed up fda approval processes and reduce our reliance on countries like china for testing. It's terrible that some of our most important medicines are made in china. Um, do you guys agree with this? Yes or no? >> yes. >> probably yes. >> yes. I think we should be near-shoring those those kind of critical materials. Yes. >> you cannot exercise your way out of bad nutrition.
▶ 1:32:42So do you guys agree that a preventative health care system that they say the positive effects of, of fitness on the brain and, uh, mental health by having proper nutrition and exercise is very important. Do you agree with this? >> americans being in better health is better for america. >> prevention is underused and needs more use. >> yes. >> your best prevention is having access to affordable care.
▶ 1:33:12>> well. Thank you. I ran out of time, I yield back. >> thank you, ranking member frost. >> um, Mr. chairman, I have a unanimous consent request to enter to the record a the hill article states medicaid cuts will harm rural republican communities most. >> without objection, I now recognize miss randall for her line of questions. >> thank you so much, Mr. chair. And thank you to our witnesses for being here today. I love a robust conversation about how we can improve our health care system.
▶ 1:33:41I don't think any of us on either side would say that the system that we have is perfect and is working exactly as it was intended to. I do, however, have real concerns about saying it's not working, so we should not reinstate these affordable care tax credits so that more people can lose their health care so that the system is even more broken.
▶ 1:34:11And then we have to decide how to fix it. I don't think that's the way to meet the healthcare needs of the american people. It's not the way that they're asking us to meet their health care needs. And it's, I think, frankly, dangerous for our country. We have, as my colleagues have said, a ticking clock on these aca tax credits. We were so quick to act when, you know, billionaire and big corporation tax credits were set to expire, congress was called back into session from vacation to make them permanent.
▶ 1:34:42I don't understand why we wouldn't act immediately for the benefit of the american people who are struggling with affordability and are struggling with a health care system, that said, you know, I think even the original drafters of the affordable care act, including president obama himself, would argue that the aca was not the be all, end all dream of, um, you know, health care for people in this country.
▶ 1:35:13They didn't have the votes for a public option. So, yes, giving money to the insurance companies is a large part of what the aca is able to do, because that's how people are guaranteed health care. Before the aca. I don't know how everyone's memories are on this. Folks may not have been super engaged before the aca. Um, women who had been pregnant could be denied health care coverage. Folks who had other preexisting conditions. Any health care needs could be denied health care coverage.
▶ 1:35:42We had very high uninsured rates and high rates of people unable to access health care. There are lots of ways to make sure that we solve that problem. The affordable care act was the bill that had the votes to pass at the time. It's been a while we can revisit rebuilding a healthcare system like Mr.
▶ 1:36:05Frost has said, like single payer that meets the needs of the people, lowers costs, and ensures a more healthy future for all of us. There are lots of different approaches that countries around the world have taken that have been explored in the united states, as a member of the legislature in washington state, worked on establishing washington state's universal health care commission, some of the strongest, um, universal health care policy to be passed by any state in the last ten years.
▶ 1:36:32We know that we need improvements, but we also know that the free market is not the solution for health care. An unchecked free market means that, you know, folks who don't have coverage, who don't have the ability to afford care, just won't get it. They'll die often.
▶ 1:36:55Yes, you can't shop around in the ambulance, but there are ways that we can provide more transparency into health care costs. Like washington and many other states who have created an all payer claims database that collects and publishes data so that you can look up how much it costs on average to get a mammogram and how much those mammograms cost, you know, different facilities near you.
▶ 1:37:21But the problem for most people, especially in rural communities, including many in my own district, many in the districts of my republican colleagues, are that there are not that many health care facilities available and accessible, and those that are are at risk of closing because of the dramatic cuts from the big ugly bill to medicaid, rural health care was at risk before we passed h.r.
▶ 1:37:49One, and now it is hanging by a thread. What does it matter if you could shop around if your nearest two hospitals are two and three hours away from you? I also think we need to make space for technology, and I know that's what we're here to do today, to talk about how innovation and technology can help lower costs for families.
▶ 1:38:15But I hear a lot from my neighbors on medicare who are worried about unchecked technology and ai impacting their ability to access care. Doctor obermeyer. I'm concerned about the wiser model. And you know what? That unchecked, um, ai implementation will do to folks abilities to access care. That's why I'm a co-sponsor of the smarter care act, a measure to ban the wiser model from medicare claims.
▶ 1:38:44Do you believe that ai systems need independent oversight to ensure patient patients are denied medically necessary care? >> absolutely. >> thank you. Um, I'd like to request unanimous consent to enter into the record a letter from a retired physician in my district. How wiser will enable companies to profit from pain. Thank you. And?
▶ 1:39:08I know my time is at the end, so I'll just wrap up by saying I agree. We have to fight consolidation. I agree we have to fight to take some of the costs out of the health care system. I agree that more people need access to better health care, and what we know is that vertical integration and consolidation of our health care systems doesn't lower costs for patients at all. It may lower costs for the provider groups, it may lower costs for the shareholders, but it doesn't lower costs for patients.
▶ 1:39:38Thank you. >> thank you. I now recognize the governor. I'm sorry. The gentleman from florida, Mr. donaldson. >> thank you. Chairman, I appreciate your sentiment. Um, before I get into questions, I think it's important to acknowledge what we're just said. I want to start with some of the positives I just heard. Uh, the truth is that, yes, more competition in health care is going to be critical to deliver affordable care to consumers. And that's something I think, which is a very bipartisan statement.
▶ 1:40:07I think both sides of the aisle can agree on that. I think one of the things that was also just acknowledged is that the entire purpose of the affordable care act was not the affordable care act. It was to take the united states towards single payer. Single payer health care. That was the design 15 years ago.
▶ 1:40:26So the american people need to understand the reason why costs are rising in health care and in health insurance is, by design, by congressional democrats at the time and by then president barack obama. They did want a public option. They wanted to put a public option in the affordable care act. That was going to be lower cost than what their own regulatory framework would allow in the private markets. The only reason they didn't get the public option is because they didn't have the votes.
▶ 1:40:56A guy named scott brown won a senate election in massachusetts. I know that sounds crazy today, but he did, and it stopped them from actually pushing forward with the public option, which which, by the way, its entire design was to move america toward single payer health care. The arc of history in healthcare needs to be clear on this point. Single payer health care does not work. It never will.
▶ 1:41:22Because to the point of my colleague from the other side of the aisle, single payer is the very definition of vertical integration of the health care system, which will not lead to lower costs for the american people. But I digress, Mr. jacobs, you referenced, uh, that a single social security number was linked to over 26,000 days of subsidized healthcare coverage across more than 125 insurance policies in 2023.
▶ 1:41:48What mechanisms can be put in place to detect and prevent this level of exploitation of taxpayer funds, and what underlying vulnerabilities contributed to this abuse? >> yes, Mr. donaldson, that's correct. And the government accountability office report that was released last week was just one of many data points suggesting that there is significant amounts of improper enrollment and potential fraud.
▶ 1:42:14Uh, on, on the exchanges, I think some of it is driven by, uh, there are certainly rogue, um, agents and brokers that have been acting and cms both under the biden administration and certainly under the trump administration, have have acted to crack down on that. I think eliminating zero premium plans, I think, is a matter of good policy that I think regardless, we should be asking everyone to pay at least a little bit of something towards their health insurance, uh, every year.
▶ 1:42:42>> not to cut you off, but I want to acknowledge something that you just said in your opinion, do zero premium plans lead to fraud and abuse? >> I think without a doubt the the system responds to incentives, and we've only had zero premium plans for, um, the past few years under the enhanced subsidy regime.
▶ 1:43:01And we've seen that the amount the concerns about improper enrollments, whether it's cbo or cms with the data regarding zero claim, uh, enrollees in exchange coverage, all of them have been pointing to increased incidence of improper enrollments and fraud. >> okay. Thank you for that, Mr. obermeyer. If artificial intelligence becomes significantly integrated into medical practice, what impact should we expect on the health care workforce?
▶ 1:43:30>> I think what we've learned from the history of automation and technology adoption is that it doesn't necessarily eliminate jobs. It actually changes the nature of those jobs. So doctors will start to need to interact with these tools and learn from them. And I think they'll start to augment the capabilities of especially nurses, um, community health workers and others who can now have access to cutting edge technology applied to the data from patients to help them make better decisions. >> real quick. A quick follow up to that.
▶ 1:44:00Do you think that the affordable care act's regulatory framework allows for this type of internal innovation in the health care system? >> uh, I don't know about the aca specifically. I think right now there are, um, not very strong incentives for a lot of health systems to adopt this ai technology. I think the access program that was recently announced from cms is a good start in that direction. By incentivizing preventive care, augmented by technology.
▶ 1:44:25But I think that government programs can do more by, for example, creating payment codes for ai technology that drives lower costs, higher value care, and even detects the kinds of fraud, waste and abuse that you mentioned earlier. >> well, look, I'm all for efficiency. One of the things I do have a concern about is I hear that, yes, ai is being used in some respects in health care, a lot of it for upcoding as opposed to pushing for efficiencies.
▶ 1:44:52And I think that's a major issue, uh, that we we definitely have to get our heads around both here federally and at the state level. Chairman, if I might indulge, I did want to ask a quick question of miss tripoli. Um, I know I was hearing your dialog with one of my colleagues earlier about affordability. Um, I recognize everybody has a concern about it. The honest question. Do you really think that a centralized health care system will lead to efficiencies and lower costs for the american people?
▶ 1:45:20>> I think there are a lot of different models to get to a universal system of coverage that make sure that every person in the country has access to affordable, high quality health care and health that they deserve. In any of those systems, you have to actually address the incentives and the way that prices in the health care system are set. And whether you're in the current system we have now or some future system, the reality is, is that the biggest drivers of our affordability crisis in this country on health care are the massive consolidation from corporate health systems, from insurance plans to drug companies to hospital chains.
▶ 1:45:49And so in any universal system of coverage, that issue has to be addressed. And of course, most immediately, if people can't afford care, then they can't access care. And before us right now, there's a decision about extending the enhanced premium tax credits. And we urge the congress to act on that. >> well, look, Mr. tripoli, were we will have some agreement is on consolidation. I have serious concerns about that consolidation as well. Um, I think if we're talking the universe, uh, one size fits all system, I mean, I've not seen one that's worked just about anywhere in any industry that's ever existed on this planet.
▶ 1:46:21But I know people will continue to try. Sorry, I know I'm over, I yield. >> thank you. I now recognize my colleague from missouri, Mr. bell, for his five minutes. >> thank you, Mr. chair, ranking member and our witnesses for being here today. Um, the purpose of today's hearing is to discuss how technology can help reduce the future cost of health care. But I find this topic very ironic, because we can't look forward to the future of health care while ignoring the challenges that americans are facing now.
▶ 1:46:52Um, the reality is that there are over 24 million americans facing unaffordable health care. With the pending expiration of the aca premium tax credits in missouri alone, premium tax credits assist 95% of our marketplace enrollees. And so I heard a few few comments that have me over here scratching my head. Um, um, Mr.
▶ 1:47:15Jacobs, you said that the aca has not did not make it has not met its stated objective, objective objectives, um, and costs continue to rise faster. Um, and there's a failure to control health care costs. Do you remember saying all that? Right. Yes. So I want to use an analogy again. So would everyone agree that social security overall is a good thing? Any objections to that?
▶ 1:47:46Okay. So when social security was created in the 1930s, most women were excluded. Intermittent workers were excluded. Nearly half the workforce population was excluded. And then it gets really rich with black folks.
▶ 1:48:06Two thirds of african americans were excluded, 7070 to 80% in certain in certain regions of of the of of african americans were excluded. But over the years social security was improved and I would say mostly by democrats. But there was some bipartisan efforts there throughout the years to improve it.
▶ 1:48:31So we would I think it's safe to say that there was a point in time social security was not necessarily effective and a good thing. And supporting folks, a lot of folks who needed it. And it got better because folks worked at it. So it it's befuddling to me when when we talk about the aca, when republicans talk about how bad the aca is first, it's the best thing we got going right now. Yes, it could be improved. So let's improve it.
▶ 1:49:00And so let's talk about the history I'm a data person. So in 2010, republicans unanimously opposed the affordable care act. We all know that in 2000 and didn't offer any alternatives. Right. No alternatives. Just opposed it. Every single republican 2011 as soon as republicans retook control of the house, they voted to repeal the aca. Remember the whole repeal and replace?
▶ 1:49:28We never got the replace idea. But that's a different subject. Never. Every every republican voted to repeal it. 2012 republicans unsuccessfully challenged aca in court. Now, was there any court filings that the republicans championed to improve the aca? No, just to repeal it. I got a lot here to I'm going to try to get it in here. In 2013, republicans refused to fund the government without delaying or repealing the aca.
▶ 1:49:58They didn't say, hey, we got some some ways to improve it. We just want to repeal it. 2015 republicans passed a bill repealing the aca that was voted that was vetoed by president obama. No. No help, no, no ways. Suggestions to improve it in 2017 2017, days after taking office, president trump canceled aca enrollment outreach. Advertising during open enrollment is typically.
▶ 1:50:30Does that help get the word out and help get coverage for folks? >> no. >> um, in 2017, republicans tried and failed to repeal the aca again. In 2017, republicans passed donald trump's tax plan, gutting the aca's individual coverage mandate notice. There was no legislation to improve it, make it better for americans. In 2017, the first trump administration cut enrollment outreach funding by 90%.
▶ 1:51:00They didn't do anything to improve the aca. So when we are three weeks, three weeks away from the end of the year, in the middle of open enrollment season, and I'm still waiting, we are all still waiting for a vote to protect the american people. So again, I gotta ask, where is it? Where is this vote? Where is the help? Where is this plan? Um, where's the action to back up the promises and talking points?
▶ 1:51:24And so the the where's the evidence that you all truly care about the affordable access to health care for the american people? Because every single thing that we see is just to repeal what is what has done best to control costs for americans. Yes, it could be better, but republicans got to work with us.
▶ 1:51:49Americans are screaming for relief with health care costs, and I appreciate some of the things that you're doing, particularly Mr. worley in, um, in missouri. But these are only layers of things that we need to improve health care costs, but we have to address the address these issues head on. And it's going to take democrats and republicans working together and stop playing politics and actually get in a room and do it. If you don't want to call it obamacare, great. We'll call it something else.
▶ 1:52:18We can call it the obama trump plan. I don't care. Let's just do what we can to work for the american people and bring the cost down. And right now, republicans for the last since this act was implemented, have not given us one single plan to improve it or to to help americans address these issues. Thank you. And I yield back. >> thank you. I now recognize the gentleman from texas, Mr. gill for five minutes.
▶ 1:52:49>> thank you, Mr. chairman. Thank you for for holding this hearing. Um, and thank you for, uh, to the witnesses for for taking the time to be here. We certainly really appreciate it. I appreciate my colleague on the other side of the aisle and their sincerity, uh, and their desire to fix our, our health care system and make it better. I would suggest that, uh, social security and a in our health care system are not comparable or perhaps even analogous. Our health care system is $5 trillion. It's about 18% of our gdp.
▶ 1:53:19And social security does not have the same bloated cost structure that is inherent in a single payer health care system, which our colleagues on the other side of the aisle, uh, have been proposing.
▶ 1:53:35And I think we need to think a little bit more deeply about ways that we can bring those costs down rather than bringing in, I think, uh, incomparable, uh, in an analogous, um, other government programs. But with that said, I do think that there's a lot of bipartisanship, uh, in health care. And I think that there's a lot of things that we would that we would agree on. Um, miss tripoli, thank you for for being here. And thank you for your, your testimony. Um, I believe in your testimony.
▶ 1:54:04You urged policy makers to get to the root causes of high and irrational prices, uh, in our health care system. Is that correct? >> yes. >> and you would agree that health care consolidation is one of the main drivers of high prices for patients? Yes, I certainly agree. And you you also mentioned price disclosure that hospitals should disclose the rates that they charge, uh, openly in dollars and cents, I believe, were your words. Is that right? >> absolutely. Yes. >> I certainly agree.
▶ 1:54:31You also mentioned site neutrality that we ought to prohibit health systems from charging medicare more for the same procedure if it's done in a hospital versus a doctor's office. Isn't that right? Yes. Well, those are those are, I think are all things that we can agree on which is which is really, really nice to hear. So I appreciate that. Uh, Mr. jacobs, I want to ask you about obamacare. Obamacare was sold to the american people as a program that would drive down premiums.
▶ 1:55:00I think the number that was thrown out by president obama at the time was $2,500. Has that promise come to fruition? >> no, no, it has not. Congressman, in in premiums on individual health insurance policies, on the marketplaces and exchanges more than doubled, uh, in the law's first four years. And that's primarily because of the regulatory mandates that the law imposed.
▶ 1:55:22And prices have continued, premiums have continued to increase substantially, and they continue to increase substantially, more so on the exchanges than than for employer sponsored coverage. >> so you would say that obamacare didn't slow the growth of premiums in any meaningful way. >> I think, if anything, quite the contrary. I mean, senator welch, I believe in last month admitted on the on the senate floor that that the the law failed to fail to reduce costs.
▶ 1:55:50But more than that, I think it's accelerated the cost growth because of the consolidation that has come about in terms of hospital mergers, uh, insurers buying pbms. Et cetera. Et cetera. >> and that's what I was getting to did obamacare address or fix any issues related to price transparency? >> ultimately, there have been regulatory efforts. Some of the trump administration efforts were actually linked to regulatory requirements in the law. But I think we can and should do more.
▶ 1:56:20And I think we've also seen that hospitals aren't necessarily, uh, complying with that law either willingly or easily. >> did obamacare address or fix issues related to pricing disclosure? >> I think we need to do more is what I would say. >> got it. And it and it's your testimony as well. If I, if I heard you correctly, that obamacare actually exacerbated pricing issues related to health care consolidation. >> that's correct. And we've seen that in many areas.
▶ 1:56:48For instance, the congressional budget office recently released a report on the 340 b program and how the 340 b program is encourages increasing federal spending and consolidation. Now, obamacare did not create the program, the 340 b program, but it certainly dramatically expanded it and is one of the reasons why it's it's continues to to grow and continues to accelerate health costs. >> got it.
▶ 1:57:13And there's uh, with the remaining 30s, um, as you know, there's a lot of debate right now about potentially extending covid era, uh, enhanced premium tax credits. In your opinion, would that lower overall health care costs or would it raise overall health care costs?
▶ 1:57:30>> the the the the the subsidy regime is inherently inflationary because once an individuals, uh, hits their income in terms of how it's structured in the law, that percentage of income, every marginal dollar of a premium increase gets paid by the federal government. So insurers have no incentive to control costs, because whether the premium goes up by by 1% or 100%, the feds subsidize that.
▶ 1:57:59And and so it's an inherently inflationary structure. We've seen the concerns about fraud. I think those reasons, coupled with the fact that enrollments have held steady thus far in open enrollment, all suggest that we should allow the enhanced subsidies to expire. >> got it. Thank you. >> thank you. I now recognize the gentlelady from california, miss simon, for five minutes. >> thank you all for coming today, uh, to be a part of this conversation.
▶ 1:58:26And I especially want to say hello to my constituent from uc berkeley, doctor ivan meyer. Thank you so much for being here. And I know we're talking about the affordability of health care and aca credits, which I will expand on in my short remarks. But I want to say, um, I'm a widow and I lost my husband who left me parenting two girls by myself, and he was diagnosed with a terminal cancer that was so rare, only about ten people
▶ 1:58:57In the united states get this cancer each year. And after five years, despite the intervention and the treatment, they all die. Kevin had t-cell prolymphocytic leukemia. And even with insurance flying across the country to find just a little bit more time and getting into a clinical trial, it took all that we had and post his passing. Myself and my little girls were left with a mountain of debt.
▶ 1:59:26A mountain of debt. I'm so thankful to our insurance providers because without them, that debt would have been in the millions, not just $1,027,000 a day for a bag of campath that hung while he had immunotherapy every day for nine months before transplant, I couldn't imagine.
▶ 1:59:46I couldn't imagine where we would be, even though we struggled without health insurance in january, there will be families, tens of thousands of them across the nation. Maybe in the hundreds of thousands. They will see their rates, but triple, and many of them will have no choice but to just bail out. We know that and use emergency room cares. The democrats and republicans, for whatever reason.
▶ 2:00:11Maybe we haven't independently, personally suffered enough in our own families to figure out how to put politics aside and get it right for families who are suffering, who are waiting on a call for a clinical trial, families who are waiting for labs like the crispr lab to develop just one more innovation that might give dad or mom or that baby with tpn in her nose just a little bit more time. So all has been said on this panel.
▶ 2:00:41But one of the things that I think it's important for me personally and politically, having talked to thousands of families as a cancer mom and as a cancer widow. We can't innovate fast enough.
▶ 2:00:57You know, during the congressional black caucus foundation's annual legislative conference, I actually hosted a panel with openai and a cato labs and the hidden genius project, and a brilliant scholar, rashad robinson, on how ai is transforming medicine and innovation. I'm from the bay area, the home of ai, the home of biotech innovation, and I'm so proud to represent that sector. I'm so proud to represent that region. We know that we can, in fact, democratize medicine.
▶ 2:01:27We can democratize innovation. New technologies, including ai, present exciting opportunities for patients, physicians, scientists, and families. We already know that ai is advancing life saving early detection for cancer, alzheimer's, right? In berkeley, at the crispr lab, we know we are this close. Doc. You know this to providing sickle cell patients with a new lease on life this close.
▶ 2:01:56Unfortunately, the trump administration took millions from that lab, leaving folks waiting. As someone myself who was born a preemie with a congenital visual impairment, I know how important these technologies are for disabled communities.
▶ 2:02:13I know how, as I talked about before, how important these technologies are for clinicians who when my husband was diagnosed with t-pll, they were using you all know who our physicians, they were using up to date printouts, you know, up to date.
▶ 2:02:31Can you imagine in ten years where we will be when physicians and pathologists will have the technology to immediately access gazillions of language models again, to give patients and families more days? So I have some questions.
▶ 2:02:51I don't have the time, but what I am committed to doing here with you all in my district and beyond, and with members of this committee across the aisle, is engaging in a short and long term conversation that hopefully involves action to get it right for the people who need us most. I want to thank you all for coming today.
▶ 2:03:12I can't wait to work with you all in my office a little bit more, hopefully a little bit more, and to continue to be someone who yells from the rooftops about what our people deserve and what hopefully they'll get, and I'll yield back. Thank you so much. Thank you. >> Mr. frost. >> Mr. chairman, I ask unanimous consent to enter the record. A commonwealth fund report entitled expiring aca premium tax credits could lead to nearly 340,000 jobs lost across the united states in 2026. >> without objection. >> and one more.
▶ 2:03:42This is from the center on budget and policy priorities, entitled by the numbers harmful republican mega bill will take away health care coverage away from millions of people and raise families costs. >> without objection. In closing, I want to say thank you again to our witnesses today for your testimony. And with that, I will yield to ranking member frost for his closing remarks. >> thank you so much to our witnesses for being here. And thank you so much. To the chairs, plural, for having us here today.
▶ 2:04:11Um, this conversation of healthcare affordability is incredibly important, very personal. So many people on this panel, um, and it is important that we look at what's right in front of us, which is the expiration of the affordable care act, tax subsidies, like I mentioned.
▶ 2:04:29And I entered into the record earlier, my republican colleagues on this, uh, hearing represent 738,000 people who depend on the affordable care act tax credits, um, in missouri seventh, that's 59,000 people in wisconsin. Six is 34,000 people in alabama. Six. That's 56,000 people in arizona's ninth. That's 44,000 people in louisiana's third. That's 44,000 people in texas.
▶ 2:05:0017th. That's 76,000 people in florida's 19th. That's 149,000 people in florida's 13th. That's 101,000 people in pennsylvania's 10th. That's 25,000 people in virginia's fifth. That's 36,000 people in colorado's fourth. That's 24,000 people. And in texas, 26. That's 90,000 people. These are not just statistics and numbers.
▶ 2:05:31Behind every number, there's a person who is at risk of having their health care going up from anywhere from 50 to 300%. I think this conversation is an important conversation we need to have after we deal with the health care crisis right in front of us. Let's pass and extend these tax credits to make sure that working class people in this country don't see their health care costs go up so much that so many of them will just decide not to have health insurance. Um, and then let's get to fixing this broken health care system. I yield back. >> thank you.
▶ 2:06:01I now recognize myself for closing statement. We've heard from expert panel of witnesses on how to make health care more affordable for the american people and americans want simple, affordable, and transparent health care. But our current system hides the prices. It blocks competition and routes every decision through an unnecessary regulation and bureaucracy. We must prioritize innovative technologies and pathways forward to help lower these costs.
▶ 2:06:29Today, our witnesses spoke about their personal experience navigating the health care market. They testified on how misaligned structures in the current health care system are keeping health care costs high because they're not incentives to drive the cost down. Artificial intelligence will eliminate unnecessary costs if allowed, and and may allow providers to direct their efforts fully towards making patients healthier.
▶ 2:06:55And the trump administration is paving the way forward for entrepreneurs to develop the best health care in the world, while also promoting consumer choice. We need this innovation because the status quo is totally broken. The american people are suffering from the affordable care act passed by the democrats. Since 2014, obamacare has skyrocketed the cost of health care and has not led to better patient health outcomes.
▶ 2:07:25The one thing that we might be unanimous on in this country is that obamacare has failed in its goal of reducing health care costs, if, in fact, it's made it worse. We hear you, america. You're not getting simple, affordable and transparent health care right now. And that is why rather than have the hearing and just have conversations, I'm taking action.
▶ 2:07:48That's why I'm introducing a bill called the maha act that will put consumers back in the driver's seat and allow for free market as intended, to spur competition and lower costs, and give people back their freedom and their choice. The maha act will allow consumers to shop on the on the price and the quality of health care services.
▶ 2:08:09Unlike under obamacare, this will force providers to compete in the open market, driving down costs and making those costs actually transparent. Consumers will have access to tax free health wallet that will that patients can use as real money, as opposed to coupons that are controlled by an insurance carrier.
▶ 2:08:30This account will be portable from job to job, giving workers their freedom back instead of being locked into a job because of fear of losing their health coverage, this program will also make prices clear by encouraging price posting and upfront costs. Creating a true consumer focused market.
▶ 2:08:47The american health care system is facing a nationwide shortage across all major category of providers, and my plan would encourage the elimination of medical education, inflation and scope creep, expand and modernize residency training, and eliminate arbitrary hospital caps on residency slots, increasing the supply of doctors and medical professionals. The american people have spoken. They want more affordable health care.
▶ 2:09:17Today's hearing lays the foundation for a more affordable health care system in america by focusing on innovative technology and new pathways forward. The democrats have failed. Obamacare has failed. The american people and republicans are ready to act. And this act, my maha act, will fix this broken system, lower health care costs for americans, and put american families back in the driver's seat for their health care decisions.
▶ 2:09:43And, um, I now recognize chairman grothman for his closing remarks. >> thank you. Sir, I had another hearing. Uh, first of all, I'd like to thank, uh, the chairman for getting us together on this very informative hearing. And I'd like to thank all of you from coming from all around the country, four corners of this nation, to educate us on the higher costs of health care.
▶ 2:10:07I think we've seen consensus here today that there's probably too much being spent on administration, and that in some areas there's overutilization driven by greed. I want to thank our witnesses again. Americans want transparency on where their money is going. We have the responsibility to deliver solutions and provide our health care system.
▶ 2:10:30We learned today that implementing the innovative technology can provide a solution to tackle wasteful spending and misaligned pay incentives. The application of technology has the potential to address the large administrative cost burden that many patients must pay, that they do not have knowledge of. Many of us have experienced high costs within the health care without receiving high value care for ourselves and families.
▶ 2:10:56One third of health care spending in the us goes to waste, and we must act now to address this growing problem. Uh, it's going to be tough because of course, if we spend less money in our health care system, somebody is going to be getting no check or a smaller check. So the special interests will be out looking to protect the status quo. And I think the republican conference is up to it.
▶ 2:11:18And I think we'll stand up to those special interests and find a way to reduce the out of control costs, which is such a burden on your average american patient. Thank you again for letting me in the room. >> thank you, chairman grothman. Thank you, ranking member frost.
▶ 2:11:40And with that, without objection, all members have five legislative days within which to submit materials and additional written questions for the witnesses, which will be forwarded to the witnesses. And if there are no is if there's no further business. Without objection, the committee stands adjourned. >> thank you sir. >> what's that? Okay, let me go down and say hi to the folks.