▶ 0:15:55>> the senate committee on health, education, labor, and pensions these come to order. Everybody in this room, everybody watching agrees the cost of health care is too high. I have seen patient struggle with health care bills. To live it -- limit it would not do justice. I see middle income families struggle with health care cost.
▶ 0:16:25Congress must make a serious effort to navigate a whole kind of raft of reverse incentives throughout the health care system. This includes looking at health insurance benefit design, the impact of price transparency, regulatory barriers, the negative effect of government discount programs, the negative effects they have on the prices americans a in the market. I could go on.
▶ 0:16:55What it's important to realize is american workers wages, their take-home check is not going because more of the check is going towards health care. That is pretax. They never see it. You look in the pocketbook, it is being sucked away. The number one thing that we have to do is tackle health care cost.
▶ 0:17:22That is pro-worker, profamily, pro-patient. The key part is the insured -- employer sponsored insurance. That provides health care to 160 million americans. Over half that are not on medicaid. Over the past decade, health benefit costs have risen dramatically for employers and workers.
▶ 0:17:50I hope the committee could address esi in a bipartisan way. When we work together we could have a powerful impact. There are many actors like what is the problem here. They always point to the other guy or girl. They never point at themselves.
▶ 0:18:12What we have to do is recognize the problem's are diverse, intertwined, just as christmas lights can't be contained with a pair of scissors, we look at the root causes of the nation's health care cost increases and attempt to tease them out. We need bipartisan reform to realign the health care system to give the patient the power. The committee has a long history of working together to achieve this goal.
▶ 0:18:41Senator sanders and I worked on a reformat addressing misaligned incentives affecting pbm and to lower the price patients paid for prescriptions. I tell people when I go to church and I have a bernie sanders supporter here and a donald trump's order talking about the same thing usually it's about health care or prescription drug care costs.
▶ 0:19:08The president is committed to reevaluating the role of pbm's. We should see this as an opportunity to get this signed into law. They are leading the price tags at.
▶ 0:19:33They require hospitals and insurers to publicly post the prices they charge patient in a machine-readable format. Another area of bipartisan interest is the 340 program. The discounts received by hospitals are supposed to make health care services more affordable and accessible for low income and underinsured patients.
▶ 0:20:01The law is unclear and some hospitals do this and some don't. Many don't pass discounts on to nation requiring them to pay list price for drugs when the hospital itself is getting a reduced cost. A recent study found 340 b may make employer-sponsored insurance more expensive costing work $4.5 billion from 2017-2023.
▶ 0:20:33Not only are the discounts not passed on, there is a hydraulic effect. If you decrease the profit the pharmacies and companies make their, they jack up the price over here and that over here would be the commercial market for the employer-sponsored insurance sector. Patients pay more.
▶ 0:20:57Beginning last year my staff and I conducted an investigation into how health care entities use revenue in released recommendations to improve transparency in the program. This is an important topic to consider if the committee wants to address health care for all. There is no silver bullet for some issues. There is silver bookshop.
▶ 0:21:24The purpose of this hearing and the responsibility of this committee, I'm not talking about shooting a gun at anybody. If you look at different ways we could reduce the cost for the consumer or the patient, the employer paying for the insurance, that marginal cost becomes significant and we are saving money. It is pro-worker, profamily, pro-patient.
▶ 0:21:54If we wish to find that silver shot, I urge us to put aside politics for the american people. I recognize senator sanders.
▶ 0:22:05Sen. Sanders: Thank you for holding this hearing on and in norma's lien important subject. Let me begin by kind of disagreeing with you. If one's goal is to provide quality health care to all americans in a cost-effective way, clearly the current health care system is broken, dysfunctional.
▶ 0:22:34Sen. Sanders: I don't think anyone denies that. That is not the function of the current system. The function of the current health care system is to make huge profits for the drug companies and insurance companies. It is succeeding. We have a very successful system. The drug company who charges the highest prices in the world made $100 billion in profits, what is the problem?
▶ 0:23:01Sen. Sanders: The insurance companies would deny health care every day to millions of american, they made $70 million, what is the problem? We have a successful system. It is working. On the other hand, if you are an ordinary american, the system is totally broken and dysfunctional.
▶ 0:23:23Sen. Sanders: While I'm sure we have an excellent panel today, at some point if we are serious about addressing this issue we have to ask a simple question, how is it that in the united states of america where we are spending the astronomical and insein $14,500 per person and yet we have 85 million people uninsured , how come other countries around the world are able to provide quality care to all
▶ 0:23:55Sen. Sanders: People, often at less than half the cost per person? That's the question we should be asking. The answer obviously is every other country has a national health air row graham -- health care program. It is a union right, not a commodity to be made huge profits off of.
▶ 0:24:20Sen. Sanders: I do find it a bit ironic that we are holding this hearing this morning just a few weeks after president trump signed the largest cut to medicaid in the history of our country. The cbo estimated this bill along with the expiration of the enhanced premium tax credit will cause 15 million people to lose the health insurance they have.
▶ 0:24:48Sen. Sanders: It forces millions of medicaid recipients who make as little as $16,000 per year to make a 15 dollar copayment. As a result of these policies my friends and the american people, the family foundation estimated health care premiums will go up by more than 75% on average for some 20 million americans.
▶ 0:25:16Sen. Sanders: Not exactly to wait -- the way to lower health care costs. These policies will increase health insurance premiums by $3000 per year for working-class americans. George washington university found this bill will cause more than 10 million americans to lose the primary health care they receive. When millions of americans lose access to primary health care, where do they go?
▶ 0:25:48Sen. Sanders: Everybody knows they go to an emergency room, which happens to be the most expensive form of primary health care in america. If we are serious about making health care more affordable I believe a good place to start would be to repeal all of the huge cuts to tax care in trump's budget bill that passed the senate by one vote.
▶ 0:26:15Sen. Sanders: In my view we got to do much more than that. We spent twice as much on health care per capita than any country on earth. We spend $14,570, japan, $5,640. United kingdom, $6,931. France, $7,100.
▶ 0:26:43Sen. Sanders: One might think if you spent that much we got the gold plate. We got the best health care system in the world. We don't. Our health care outcomes are worse. Unbelievable. You mentioned some of the expenses and you are quite right. This is the system we have today.
▶ 0:27:11Sen. Sanders: 42% of cancer patients deplete their entire life savings within the first two years of their diagnosis and one out of every four declared bankruptcy or lost their homes. If you are diagnosed, it's a terrible diagnosis. Now people have to worry not only about trying to get healthy, they will lose their homes, go bankrupt because of this absurd system.
▶ 0:27:44Sen. Sanders: You indicate correctly this is also a burden on small businesses. Businesses can't invest if they are spending so much on health care. The reason I sale these things is the current system is broken, we need to move to a new system, that's why recently introduced medicare for all with 15 cosponsors in the senate and over 100 in the house.
▶ 0:28:11Sen. Sanders: This legislation would provide comprehensive health care service to all without out-of-pocket expenses unlike the current system it would provide full freedom of choice regarding health care providers. No more insurance premiums, deductibles, copayments, filling out endless forms and fighting with insurance companies. Would be expensive? Yes it would.
▶ 0:28:35Sen. Sanders: Providing health care for all would be significantly less expensive than our current dysfunctional system because it would eliminate an enormous amount of bureaucracy, profit-sharing, administrative cost, and misplaced priorities in our current for-profit system.
▶ 0:28:55Sen. Sanders: The director was appointed by the republican leadership of congress estimated the medicare for all bill would save the american people $650 billion a year. That is real money. $650 billion per year. How do we lower the cost? $650 billion is a big reduction.
▶ 0:29:20Sen. Sanders: Think on moving to a medicare for all system would save a family making less than 180 $5,000 about $3000 year. Let's be clear, this is exactly what the american people want. According to a poll that came out just this month, 50 9% of the american people including 67% of moderates and 57% of independents port medicare for all. Why don't we have it?
▶ 0:29:50Sen. Sanders: That touches on another issue that is broken and corrupt. Campaign finances prevents members from representing the people of our country rather than the insurance companies or drug companies. With that, I yield.
▶ 0:30:06Chair Cassidy: We will introduce the witness before her or his testimony. We will start with chris deacon. She is the principal owner and founder of versan consulting. Has first-hand experience in health insurance benefit design and could attest to the need for transparency throughout the health care system. Everybody try and hold your comments to five minutes.
▶ 0:30:39Chair Cassidy: We did a poor example.
▶ 0:30:39Ms. Deacon: Thank you chairman cassidy, ranking member sanders, esteemed members of the committee. Thank you for the opportunity to appear before you today that touches every american life and budget. The affordability of health care. I am a health care policy expert with a focus on employer and commercial market reform.
▶ 0:31:05Ms. Deacon: I served as the director of state health benefits for new jersey where we covered 820,000 public-sector lives. I've seen firsthand what employers, state governments, and working families face. Health care costs that rise faster than wages, a payment system where neither the purchaser or the patient could see where the money is going.
▶ 0:31:30Ms. Deacon: My colleague and friend behind me represents the new jersey police benevolent association. His members received a 115% increase. A ppo for a family coverage is over $67,000. 23,000 of which is covered by his members. That is $23,000 coming out of their paychecks every year.
▶ 0:31:59Ms. Deacon: Transparency is not a talking point. It is absolutely a prerequisite to affordability, competition, accountability. Without it, we cannot see the drivers of cost, how financial incentives are misaligned or which entities are extracting value and which are delivering it. Because we cannot see it, we cannot fix it.
▶ 0:32:24Ms. Deacon: Transparency is the through line of my testimony not just as a principal but as a starting point for every effort to lower costs. My written testimony fully outlines how the system across hospital pricing, claims data, pbm practices, and the 340 b program undermines employer oversight and distorts pricing. The hospital transparency rule took effect in 2021 was a good first step. We need to go much further.
▶ 0:32:56Ms. Deacon: We need hospitals to post real prices in a format standardized. We need meaningful enforcement. The transparency of coverage rule is supposed to help see what was negotiated on their behalf. The most sophisticated firms cannot use the data without major effort.
▶ 0:33:17Ms. Deacon: The employers who are responsible providing this information are being denied access to it by the very vendors that they hire. That brings us to the biggest gap and opportunity that I see for employers today. That is access to claims data and full disclosure of conflicts of interest by their covered service providers like third-party administrators. Employers pay the bills. They take on financial risk.
▶ 0:33:49Ms. Deacon: They are expected to manage the plan. They still can't see what they are paying for. They are denied access to basic medical and pharmaceutical claims data even though congress banned clauses in 2021. Whether through contract language, creative and da's, restrictive format, controlling who could analyze their data.
▶ 0:34:17Ms. Deacon: They all routinely denied employers access to their own claims data. They turned around and monetize it themselves. When employers can't see claims they can't rectify what their plans are spending. Employers are told to manage costs. They are not allowed to see costs.
▶ 0:34:39Ms. Deacon: We cannot view purchasing power on behalf of 165 million americans if they do not know what they are purchasing, from whom they are purchasing it and at what price. This begs the question, why? Why do carriers, pbm's, hospital systems, why are they so reluctant to operate in a nontransparent manner -- in a transparent manner?
▶ 0:35:07Ms. Deacon: One reason that lies in the increasingly no distinction between the buyer, the lines have blurred. What looks like a negotiation is often a deal between subsidiaries within the same parent company.
▶ 0:35:25Ms. Deacon: Unitedhealth group owns united health care, optimum rx, private label drug distributors, offshore rebate accurate -- aggregators and they are the largest employer of physicians in america. They are literally sitting on every side of the transaction. The examples abound.
▶ 0:35:51Ms. Deacon: No amount of benefit design or ingenuity could compensate for a total lack of absence of data and disclosure. These are theoretical conflicts, they drive cost without scrutiny off the entire market from medicaid to medicare to commercial coverage.
▶ 0:36:15Ms. Deacon: Whatever policy this body chooses to pursue to address the affordability crisis, whether it is public programs, private markets, a combination of both, we cannot deny health coverage is not the same as health care when nearly half of insured americans report delaying or skipping care due to cost. It is a recipe for failure. Without structural transparency, every fix weatherby taxpayer, patient.
▶ 0:36:45Chair Cassidy: Could you wrap up?
▶ 0:36:50Miss Deacon: I welcome any questions. Mr. ippolito is a senior fellow, he will speak to solutions for policymakers to consider. Thank you.
▶ 0:37:15Dr. Ippolito: I'm an economist focusing on issues directly or indirectly related to health care cost. Those costs getting close to $5 trillion per year represent a persistent challenge to put it lightly to policymakers. Obviously spending the big federal programs laces enormous stress on the federal budget.
▶ 0:37:39Dr. Ippolito: In the private market high costs puts down pressure on employment, increases premiums, it also represents problems for the federal budget. That said I don't think it argues in favor of indiscriminate cuts. A lot of that goes towards very valuable services on product.
▶ 0:38:05Dr. Ippolito: The idea is to think about could we identify the areas where we are pretty confident we are spending money where the prices do not actually reflect the value of consumers. There's a lot of areas we want to point to. One flag for that is areas where we see imperfections with a lack of realistic choice. In those markets you have prices that are high but it's not because somebody loves that hospital. They don't have any other hospitals to choose from.
▶ 0:38:36Dr. Ippolito: Targeting those settings are a good opportunity to do this without having as big of a downside. There's a lot of different policies congress could go towards to move in that direction. A couple of examples. One obvious one is congress could help regulators and policymakers get better insight into what is happening. The ftc and doj get better oversight on what is going on in market.
▶ 0:39:05Dr. Ippolito: New ways in which consolidations are happening and impede that. In other cases, we just heard about it. They actually have the information they need to make the realistic choice. This comes up a lot with things like pharmacy benefit imager services. If employers can't evaluate the contracts well, it is difficult to reward the lower cost.
▶ 0:39:32Dr. Ippolito: There is many policies that accomplish similar goals that aim to address cases where we had public programs and policies that unintentionally lead to consolidation or otherwise interrupt market action. There's lots of examples. This is a program that gives hospitals big discounts on drugs. The idea is to give them more resources to treat lower income people.
▶ 0:40:00Dr. Ippolito: They have a huge arbitrage opportunity over doctors. They could consolidate with those folks and earn this big profit margin. The goal of the program isn't bad but we may want to think about whether we could target it better to make sure we are targeting money towards those people and care to subsidize and avoid some of these problematic consolidations.
▶ 0:40:26Dr. Ippolito: Another one that has been talked about a lot is it is well understood that paying hospitals more to provide certain services that could be provided by physicians incentivizes hospitals to consolidate with those positions. It makes it very difficult to operate a standalone operation. You have this major disadvantage.
▶ 0:40:51Dr. Ippolito: That gives a huge incentive to consolidate and it is a great example with how consequential and challenging it is to specify the full price schedules we have to deal with. That is not an exhaustive list. Some examples of tangible policies that work in cohesive direction and target spending where we think the trade-off in welfare is not as bad. Thank you very much. I look forward to questions.
▶ 0:41:21Chair Cassidy: Dr. miller. You could go ahead. Dr. brian miller is a practicing hospital medicine physician and associate present -- professor of medicine at johns hopkins university. He will speak to the value of transparency from a physician's perspective. He's a commissioner on the medicare payment impact and a trustee for the north carolina state health plan.
▶ 0:41:49Dr. Miller: Thank you. I appreciate the opportunity to share some practical thoughts.
▶ 0:41:56Chair Cassidy: Is your microphone on?
▶ 0:42:00Dr. Miller: It is. I spent last weekend working in the hospital. I come here from a point of pragmatism. I am here in my personal capacity. My views don't reflect those of my employers. I want to talk about three areas. One is hospital price transparency. I looked at some stats.
▶ 0:42:27Dr. Miller: I sought in 2020 two americans purchased 13.6 million new cars amongst 275 models. They had 237,000 independent shops. Consumers could make trade-offs on price, reputation, trustworthiness, brand. We should empower them to do the same thing for health care, especially for nonemergent services.
▶ 0:42:55Dr. Miller: The transparency rule that was a trump administration policy that was supported by the biden administration was not supported by hospital administration. If we look at the last oig report we saw 37 out of 100 hospitals complied with the two major components of the rule. In my view, that is a crime against patients. We should codify price transparency.
▶ 0:43:23Dr. Miller: We should also routinely audit large health systems with the focus on tax-exempt institutions . We should couple this with implementation, penalties, public size asian of non--- public sization. I also think facility fees are a big problem.
▶ 0:43:47Dr. Miller: I know and I still have to check what is a hospital outpatient department. Do we think it will understand it is greater than 250 yards away from the originating facility and was acquired as an ho pd before 2015? We all agree that sounds absurd.
▶ 0:44:09Dr. Miller: We should have a requirement of transparency for the facility fees and frankly I think cms and ftc should investigate these practices. I also think we need to put patients and physicians together in the driver's seat. Put it in the health record so they could have that conversation. They could do that. Pvm's are unpopular.
▶ 0:44:38Dr. Miller: I want to spend a moment talking about those. I believe in product innovation. If you had advanced melanoma, it was a death sentence and now you could live for several years. Pharmaceutical product manufacturers understand promoting the value of their drug. Not the relative value of their drug. Physicians and patients know a lot.
▶ 0:45:08Dr. Miller: That is why we have pvm, there are problems. One is plan sponsors and employers don't always have full insight into how things work. I think we would have transparency for plan sponsors. They could have a good idea of what they are buying. They want pvm's and employers to have choice of contract and it needs to be an informed choice.
▶ 0:45:40Dr. Miller: We need to look at the consolidation of the marketplace. We have three or four pvm's. The ftc approved these mergers over the last 20 years. They should do a retrospective merger review. I looked up some of these cases and the ftc thought they would lower prices, not raise them. You also need to take a look at a recent share of responsibility for pvm's.
▶ 0:46:10Dr. Miller: I want to close by saying employers do have agency. I'm on the board of the north carolina state health plan. We have redesigned the benefit. We implemented a network called preferred providers. It will save costs, drive volume , improve quality. We also have good retiree product, which is nature.
▶ 0:46:40Dr. Miller: It trades off cost quality and access. I think there are a lot of things we could do practically that will improve transparency, lower cost, power consumers. I appreciate the opportunity to share those costs with you.
▶ 0:46:54Chair Cassidy: I recognize sensors -- senator sanders to introduce his witnesses.
▶ 0:47:01Sen. Sanders: I would like to introduce Dr. adam gaffney, assisted -- assistant professor at the harvard medical school. His research focuses on health care affordability, access, reform. Thanks for being with us.
▶ 0:47:21Dr. Gaffney: All the members of the committee, thank you for having me here to testify today. There we go. Thank you for having me here. We are here to discuss health care affordability. Let's take stock of where we stand today before the one big beautiful care act takes effect.
▶ 0:47:48Dr. Gaffney: One in four working age adults with insurance have health coverage they could barely afford to use because of co-pays or deductibles. One in five households is burning by medical debt. Health-care spending is projected to take a whopping 20% of our gdp.
▶ 0:48:08Dr. Gaffney: Our administration and bureaucracy consumes about one third of our total health care dollars even as tens of thousands of americans die every year for lack of health coverage. I have witnessed many of these harms firsthand. Patients who have foregone treatment wound up with strokes, heart failure, kidney failure.
▶ 0:48:31Dr. Gaffney: Those with diabetes forced to ration insulin and develop life-threatening complications such as ketoacidosis and patients with asthma or emphysema gasping for breath. Make no mistake, the one big beautiful bill will make such medical tragedies only more common. That bill will swell the ranks of the uninsured by some 10 million.
▶ 0:49:00Dr. Gaffney: In a study colleagues and I published, we estimate the trillion dollar medicaid cuts will cause nearly 2 million people to lose personal position -- physician, 1.3 million to skip medications, more than 16,000 americans to die before their time because of these cuts. Not only those with medicaid suffered. Americans with marketplace plans will see their premiums skyrocket on january 1.
▶ 0:49:32Dr. Gaffney: For hundreds of thousands of low income seniors the reconciliation law will mean higher drug costs and more preventable deaths. Health care affordability is about to go from bad to worse. Let's shift to solutions. Two being discussed today, price transparency and manager reform are reasonable. Price transparency were out -- will offer little for illnesses.
▶ 0:50:03Dr. Gaffney: You cannot shock your way into the icu with a heart attack. Or many communities where there is only one hospital system. Patients suffering from cancer shouldn't have to be comparison-shopping for a life-saving surgery. Pvm's, middlemen who purchase drugs from pharmaceutical manufacturers on behalf of insurance companies add an extra layer of fat to the system.
▶ 0:50:39Dr. Gaffney: Let's be clear, pvm's take advantage of the sky high drug prices set by pharmaceutical companies. At least twice what other countries pay. These reforms are not solutions. To make health care truly affordable, we need to cover everyone but make sure coverage provides real protection.
▶ 0:51:02Dr. Gaffney: No narrow networks and end the hours and hours spent on the phone with insurance companies everyone crazy. To afford that expanded coverage we will need to find savings elsewhere. We could eliminate the gargantuan waste imposed by financial insurers. The traditional medicare program takes about 2% of its total revenue for overhead.
▶ 0:51:35Dr. Gaffney: Medicare advantage plans take at least five more than that for their overhead in profit. The reconciliation law will bloat the health care system. New bureaucracies in each state to monitor and quadruple check for people's documentation of their work efforts. That will cost taxpayers billions.
▶ 0:52:02Dr. Gaffney: In contrast the budget office could save over 400 billion dollars annually by simplifying health care payment and cutting out private insurers. American health care insurers lies at a crossroad. The road we are currently treading. Ever-expanding bureaucracy and more patients dying due to a lack of care.
▶ 0:52:30Dr. Gaffney: It is a simpler, more effective system that provides full coverage with the financial welfare and their health. Thank you so much.
▶ 0:52:40Sen. Sanders: Thank you very much. I would like to introduce wendell potter. Mr. potter is a former insurance executive turned industry whistleblower. He has advocated the reform and recently published a report on with united health group. Thanks for being with us.
▶ 0:53:03Mr. Potter: Thanks for being with us members of the committee. When I first testified 16 years ago I warned about the business practices of consolidating the insurance industry. I saw how insurers confuse their customers. Also they could satisfy wall street investments.
▶ 0:53:28Mr. Potter: That is even more true today due to integration enabled by bipartisan senses that we are trusted to lead a public-private partnership. There is silence on the public-private partnership. Twice congress handed them the keys, first with the medicare modernization act and created the medicare part d program and again with the affordable care act in 2010.
▶ 0:53:58Mr. Potter: Both laws included guardrails, they crashed through them and made huge profits. I supported both projects. They sought to inform -- reform harmful insurance practices. Both tried to curve these models.
▶ 0:54:21Mr. Potter: They introduced a risk scoring system to pay insurers system by exaggerating illness. They will collect an additional $84 billion of our tax dollars this year alone. Which I know congress never intended. Before the aca insurers were spending less and less.
▶ 0:54:46Mr. Potter: That law introduced the loss ratio provision and requires insurers to send -- spend 85% of their premiums. The industry found a workaround. It does not apply to health care providers, clinics, home health agencies. Hospice operations.
▶ 0:55:09Mr. Potter: They now pay themselves satisfying mlr requirements while shifting more money for profits. Unitedhealth transfers nearly one third of its total revenue to provider entities. My team and I published a report that united has almost 3000 subsidiaries. Most involved in health care delivery.
▶ 0:55:38Mr. Potter: The consolidation gives unitedhealth control over nearly every patient interaction from finding a doctor, seeing a physician that the company employs two filling prescriptions, receiving home care through subsidiaries and accessing veterans benefits. Often in ways that regulators cannot track. He reportedly pays its own physician more than it pays independent doctors.
▶ 0:56:09Mr. Potter: These transfers are reported as medical spending but in reality they funneled through a wide coast. Unitedhealth intercompany transfers 31% of its total revenues and the more charges, the more it profits.
▶ 0:56:30Mr. Potter: It provides 70% of its health insurance revenue despite having far more enrollees in crete -- collects billions in profits I gaming the system you put in place. Independent physicians are squeeze sadly because of their need and sold out to hospitals or insurance companies. That has led to further consolidation and introduced patient choice.
▶ 0:57:01Mr. Potter: Patients are paying the price. High deductible plans are forcing people to delay or skipped what they need. I promoted those plans until I saw hundreds of patients lining up for free medical care at a county fair ground where I grew up. They could not afford their deductibles.
▶ 0:57:27Mr. Potter: Most americans have health insurance that carry medical debt. The battle insurance companies to get their care. To restore affordability and access you must act with a sense of urgency. We need to close loopholes that require full transparency. We need insurers to not be allowed to use tax dollars to fund stock buybacks, dividends, misleading ads.
▶ 0:57:58Mr. Potter: We have to consider expanding budgets like marilyn has. We also need to offer people a public option with traditional medicare. I encourage you to pass the bipartisan patient before the monopolies at for private insurers.
▶ 0:58:28Mr. Potter: We need to phase out our own pvm's like ohio has done. I urge you to scrutinize this public-private partnership that insurers have seized control over as long as they are in control, they will continue to prioritize profits over people. It's time to demand transparency in a system that serves patients and not shareholders.
▶ 0:58:56Chair Cassidy: Thank you all. I'm a business guy. Watching from home, we all talked a lot of language. I want lower premiums. If they have machine-readable files, this would be the way to lower premiums.
▶ 0:59:24Chair Cassidy: You are saying that if -- say it in plain english. Somebody watching here knows how price transparency will lower the amount they are paying for health care and put more money in their pocket.
▶ 0:59:41Miss Deacon: When you pay a premium to your employer that employer is responsible for purchasing health care on your behalf. If that employer cannot see what they are paying to a hospital, the prices they are paying, what is coming out of the bank account, they are unable to control that cost. It might surprise that person. As they went to hospital aid, they could pay cash.
▶ 1:00:13Miss Deacon: The business --
▶ 1:00:15Chair Cassidy: The business would be able to say wait a second, why don't I have this hospital and network if the cost of a colonoscopy is so much less, why aren't they in my network? It gives the employer the ability to say I could pay less if I have them.
▶ 1:00:40Ms. Deacon: This isn't just for shopping preservice. Data transparency in employer access to data are absolutely essential for high cost services as well because it is the employer and their vendors that will look at those prices and make sure what they are paying for is accurate.
▶ 1:01:05Chair Cassidy: I think the quote on buying a car and seeing what my best deal is, in a sense the patient or employer could go to consumer reports and say what is the best deal for me on a suite of services we anticipate?
▶ 1:01:23Ms. Deacon: Not only what is the best deal but what did I pay for in making sure that is accurate.
▶ 1:01:29Chair Cassidy: Let's bring it down to the patient themselves. You could spend the facility fee in the hospital. A lot of people are paying it until the charge.
▶ 1:01:48Chair Cassidy: >> you end up paying about 60% or 70% more because hospitals are allowed to tack on an additional charge, it facility fee to support additional infrastructure. What it means is the hospital pasted their corporate name on it.
▶ 1:02:07Chair Cassidy: I get my blood drawn here in a typical facility be -- fee would be what?
▶ 1:02:16Dr. Miller: A couple hundred dollars.
▶ 1:02:18Chair Cassidy: Maybe the lab, certainly we will have to pay the facility fee. That is currently not transparent?
▶ 1:02:28Dr. Miller: You could get stuck with a several hundred dollar bill and there is no way the consumer could know.
▶ 1:02:36Chair Cassidy: You spoke of the fact that there is vertical integration. That vertical integration allows cost to be passed on. You come from the insurance round. Theoretically I will buy the policy that is less expensive. Kind of looping costs within, I am asking.
▶ 1:03:03Chair Cassidy: Why would I not just take a lower-cost competitor as opposed to one who is patting the cost?
▶ 1:03:14Dr. Gaffney: They operate very similarly. They might be getting a better deal for the midterm.
▶ 1:03:25Chair Cassidy: You spoke about giving different authorities to different people. Were you speaking of justice having authority to go after this vertical integration which allows an incestuous payment process?
▶ 1:03:40Dr. Ippolito: That's a good explanation where someone with better expertise could explain it better.
▶ 1:03:47Chair Cassidy: I will finish 11 seconds early. Senator sanders.
▶ 1:03:55Sen. Sanders: Could I take your 11 seconds?
▶ 1:03:57Chair Cassidy: Nope. [laughter]
▶ 1:04:00Sen. Sanders: According to the cbo, the medicare bill that I introduced would save the american people $650 billion each and every year. The reason for that is simple. We do away with administrative costs and bureaucracy. This came from the peterson foundation.
▶ 1:04:28Sen. Sanders: Administrative costs per person in japan, $82. In the united states, $1055. In your experience, talk about administrative waste.
▶ 1:04:46Sen. Sanders: Our goal is to put health care dollars into health care for medical treatment, disease prevention, not to pad incredible amounts of bureaucracy and drive patients crazy trying to figure out how they could deal with their insurance companies. Talk about bureaucracy and administrative costs within the health care system?
▶ 1:05:10Dr. Gaffney: Our complex industry is what drives commercial cost. That is double the portion of canada. About one quarter of revenue goes towards administration alone. Why is that? Two reasons. Private insurers have a host of costs that traditional medicare does not.
▶ 1:05:40Dr. Gaffney: They need to pay high executive salaries, dividends to shareholders, they need to build huge armies to write with patients and providers to deny claims. All of that cost a lot of money.
▶ 1:05:57Sen. Sanders: Does that chart concern you? Do you think we are wasting hundreds of millions of dollars?
▶ 1:06:04Dr. Ippolito: I'm always open to opportunities to lower costs. I will say completely minimizing costs is not the right goal. If there's opportunities to lower it, that's an option.
▶ 1:06:28Ms. Deacon: I think the chart is concerning for many of the reasons we talked about. I think administrative waste could be addressed.
▶ 1:06:42Sen. Sanders: Let me ask all of you, should we do what every other major country does and look at health care as a human right guaranteeing health care?
▶ 1:06:55Ms. Deacon: I think it's how you depend health care, health coverage.
▶ 1:07:02Sen. Sanders: It means you could go to the doctor anytime you want and leave without a bill.
▶ 1:07:08Ms. Deacon: I think it's how you define health care, I will say it will depend.
▶ 1:07:13Dr. Ippolito: I don't know the answer to that direct question.
▶ 1:07:19Sen. Sanders: It's not a complicated question. Should everybody in the country be able to have the health care they need?
▶ 1:07:25Dr. Ippolito: We might have a different vision for what that system looks like? .
▶ 1:07:33Dr. Miller: I think everyone should have access to health care. It should not be free to everybody.
▶ 1:07:42Dr. Gaffney: We could afford to do it, we are the richest country in the world.
▶ 1:07:49Mr. Potter: I believe it is.
▶ 1:07:57Sen. Sanders: You recently published a report on united health group that found something pretty shocking. Unitedhealth has acquired about 2700 different health care companies. It sounds to me like we are moving to a single pay system run by unitedhealth for their own financial advantages. Would you like to talk a little bit about your findings?
▶ 1:08:21Mr. Potter: This has happened largely in the last 10-15 years. I would say it was somewhat incentivized by the provision which I believe needs to be addressed because they could shift money internally. If you look at their financial statements over time you see that every year they are paying themselves more.
▶ 1:08:45Mr. Potter: On the earnings call this past week they said to get back into wall street's good graces, they will be narrowing the networks, raising premiums by double digits and they are going to be cutting benefits across the board. Their master is wall street and their shareholders. Their profit margin is what they are most concerned about.
▶ 1:09:15Mr. Potter: To stay within the letter of the law, they are paying themselves. They are funneling more and more money that we pay them and premiums into entities they own and operate.
▶ 1:09:32Sen. Marshall: Thank you, welcome to our guests. Where to start? We have a 90-10 issue, maybe it is 95-5, since I got here eight years ago I have talked about the pillars to driving that price down but maintaining quality with transparency, innovation, consumers.
▶ 1:10:04Sen. Marshall: It is wonderful we get the opportunity to address solutions. Let's talk about solutions. I'm very proud of our signature legislation. Patients deserve price tags at. Commissioner hickenlooper supports senator hassan, grassley, ernst. Could you imagine walking into a grocery store, going to the meat department and not seeing the prices?
▶ 1:10:33Sen. Marshall: Could you imagine going to a clothing store and not knowing what the prices are? I look at the price of it. In health care, they buried the prices. Whatever legislation attempts to do is get price tags on health care. Try a couple of thoughts on what our bill buzz and get your reaction.
▶ 1:10:57Sen. Marshall: As a consumer, you have a choice of getting your hip replaced at one facility for $10,000, another one is $50,000. How would you as a consumer impact the habitual cost of health care if you are in a self-insured plan and running that plan, how could it impact your decision?
▶ 1:11:24Ms. Deacon: If I had out-of-pocket I would both evaluate for quality and cost to determine value and I would likely find myself the $10,000 clinic. As the employer-sponsored, if all of my members were to have such information it would dramatically lower the cost of premiums every year.
▶ 1:11:53Ms. Deacon: More consumers would be able to evaluate.
▶ 1:11:56Sen. Marshall: Could you drive down the cost 10%, 20%, 40% perhaps?
▶ 1:12:03Ms. Deacon: We have seen employers that are able to do that.
▶ 1:12:10Sen. Marshall: Exactly. Did I do that right? Another component of our bill ensures health care plans have access to their own data. Would that be helpful to us specifically as a self-insured plan?
▶ 1:12:31Dr. Ippolito: At a minimum if you are thinking about what services we will use next year, we don't know what services we would use and do that. In terms of those basic tasks is tasked with providing, they need that information. It seems like a prerequisite.
▶ 1:12:58Sen. Marshall: Does anybody want to counter that argument? We are of course talking about pbm's. Very horizontally, vertically integrated, three companies controlling 85% of the industry. Many of you talked about monopolies, specifically we have a bill called delinking.
▶ 1:13:28Sen. Marshall: Pbm's create formularies that prevent you from using the generic drugs. They push you to the more expensive ones. Would reforms such as delaying pbm compensation from the list price benefit patients in meaningful ways and drive down the cost of drugs?
▶ 1:13:51Mr. Potter: I agree it would. It is important legislation. I think incentivizes drug companies to have a higher list price. It is sucking so much. I didn't own a pbm. Now it is largely a pbm and has insurance plans.
▶ 1:14:22Sen. Marshall: What use to pbm patients fulfill? Why are they in this foodchain?
▶ 1:14:32Dr. Miller: There are 220,000 prescription drugs.
▶ 1:14:43Sen. Marshall: How does it help patient? If we remove them from the food chain, would we be better off? >> I don't think so. We assigned to the government to make decisions.
▶ 1:14:57Sen. Marshall: It does not have to be the government. I appreciate your answers.
▶ 1:15:01Chair Cassidy: Senator kim.
▶ 1:15:04Sen. Kim: Thank you. Ms. dig Ms. dieacon, I want to start with you. You were talking about the use of repricing and negotiation.
▶ 1:15:19Sen. Kim: There was this one case where the actual paid was around $875,000 but the total amount paid by the health plan was $4 million of which cigna contained -- retained 4.5 million. Can you explain to me and other people what is happening here in that example that you talked about?
▶ 1:15:47Ms. Deacon: In this example a member goes to seek claim and in this case it was a high-cost claim. It was submitted by the provider and to cigna. Cigna engages behind the scenes, third party vendor, to help negotiate the price of that claim down.
▶ 1:16:10Ms. Deacon: The way that the incentives are structured behind the scenes, cigna gets to a pretty big chunk of the savings generated as do their third-party vendor. In this case that claim was submitted, a high cost claim negotiated down to $875,000. That is what the provider. For providing healthcare.
▶ 1:16:38Ms. Deacon: As you mentioned, cigna kept $2.5 million and multiplan got $677,000 to negotiate that down. When we are talking about administrative waste, $875 thousand of that $4 million claim paid was healthcare. The other 79% of that $4 million is not healthcare.
▶ 1:17:04Sen. Kim: It is mind-boggling to me when I hear that. What quiet -- what value does that bring compared to what the cost of the medical care provider for the care they provided? It frustrates me so much in terms of how they justify these costs. I see the importance of what you are saying about transparency. That's a perfect example of that. I will also say that that alone obviously is not what we need to be thinking about.
▶ 1:17:35Sen. Kim: I thought you encapsulated well. You said profit-seeking is expected in any corporate structure but in healthcare it is occurring in a system that lacks the most basic market safeguards. Transparency is one. So is competition and account ability. The five if you have talked about how much we are lacking when it comes to accountability. Dr. miller, I was intrigued by what you said about retrospective merger review.
▶ 1:18:05Sen. Kim: Can you go into that a little more?
▶ 1:18:07Dr. Miller: The ftc is a smart organization. When things don't go the way they expect, they take their industrial economists and have them study what went wrong. For a long time the ftc lost in mergers and they had to take a merger review to figure out what their strategy was getting wrong and change their strategy and has done a much better job and has actually kicked butt on hospital merger review.
▶ 1:18:36Dr. Miller: We have to do the same thing with pbm's. The ftc approved a lot of to be a mergers thinking that they would decrease price and net result -- not result in monopoly power. Independent pharmacists have struggled. We need to have the ftc take a look at all of the to be in mergers they approved the last 25 or 30 years, figure out what they got wrong and how they need to change the strategy going forward.
▶ 1:19:06Sen. Kim: Mr. parker, what's your thought?
▶ 1:19:09Mr. Potter: I agree 100%. One of the things we have done is that these companies are getting for more money from their pbm's. Cvs, that company gets more money, revenue and profits from its pbm than from companies almost 10,000 stores and health plans. It is a huge cash cow.
▶ 1:19:36Sen. Kim: One thing I want to add here as I end, it is not just about cost. It is also about care. A year ago my father had major surgery and had to go to a facility. We learned he signed up for medicare advantage which limited the number of days he could be there in terms of getting the rehab. They did not care at all what the doctors said, he needed to get back on his feet and proceed. We are not just talking about the cost people are incurring.
▶ 1:20:09Sen. Kim: It is affecting the quality of the care people get. I yield back.
▶ 1:20:12Chair Cassidy: Thank you. Thank you all for being here. I appreciate the chairman having this hearing today. We are talking about savings will administration costs but healthcare has been the number one driver of inflation in america in the 21st century. We look at medicaid, medicaid costs have gone up 6.5%.
▶ 1:20:35Chair Cassidy: Private health insurance 3.5%, 256% the overall cost of hospitals collectively. We have talked about administrative costs. Even under medicare and medicaid those are both increasingly administered by private companies. This is the reality of how those programs work. More than 50% of ohioans under medicare have chosen to use a private auction. -- private option.
▶ 1:21:06Chair Cassidy: Big beautiful bill has been brought up today. You will still see increases in medicaid on an annual basis go up over 3% with the effort to try to eliminate duplicate of payments, determine eligibility and stop paying for people's health care who are not citizens of the united states. All of those things are really driving healthcare costs in the government and in the private sector.
▶ 1:21:34Chair Cassidy: I want to talk about one tool that was given in the past to make healthcare affordable that seemingly is not working in the prescription drug space and that is 340 b. The program mandates drugmakers to give entities large discounts on drugs and does not require the drugs to be -- savings to be passed to the consumer or private insurer nor does it require the hospital to use the funds in a specific way.
▶ 1:22:03Chair Cassidy: Hospitals can purchase a physician administered drug at a large discount but sell it to private insurers at full market prices and keeping the price difference as a profit. I could go on. I'm interested in solutions to this. Dr. ippolito, what thoughts do you have on how we can make 340 b work better, put more safeguards in place and passing on savings to consumers?
▶ 1:22:29Dr. Ippolito: Sure. If the goal of the program is to try to help hospitals afford care for people who don't have coverage or cannot pay, we should try to target those subsidies to those patients. Right now we don't really do that. You meet the threshold, you get the ability to buy drugs or discounts.
▶ 1:22:55Dr. Ippolito: Proposed policy solutions say, we will tie the subsidies to the patients, that way we don't need to wait. We don't need to tell us how you are using the money. It is kind of hard to evaluate. Tell us, people you treat and we will try to subjugate -- subsidize the care for those people.
▶ 1:23:12Sen. Tuberville: Anyone else have faults on 340 b and how we can make it work better? Dr. miller?
▶ 1:23:23Dr. Miller: If hospitals need funds, give them the funds. If we want the pharmaceutical industry to pay for it, do it is a flat fee or a flat tax, and that is clear and transparent so that the pharmaceutical industry has credibility and that hospitals have predict abilities about the subsidies that they could to support their operations.
▶ 1:23:51Dr. Miller: That is an idea that multiple people have talked about which would solve a lot of the arbitrage problems. Make sure hospitals are supported and that the pharmacy product developers have clear breathability of costs.
▶ 1:24:08Sen. Tuberville: Thank you. Dr. ippolito, you published research is something the net cost of certain glp-1 drugs. You found some of these drugs with high prices were 80% of the list price. Can you tell us more about that picture on certain medications and how to figure out the true cost?
▶ 1:24:29Dr. Ippolito: This is a long-standing frustration with the pharmaceutical market. We know drugs have very high prices but the price that the pharmaceutical company pays is much lower. It is, please drugs to have -- it is commonplace for drugs to have rebates. Sort of like 340 b, ensures they make it a function of the much higher list prices.
▶ 1:24:58Dr. Ippolito: That seems to me to be one of the things to work on. Trying to get rid of this discrepancy so that when the patient buys the project, there has been a negotiation to lower the price.
▶ 1:25:10Sen. Tuberville: Thank you for that. The challenge we are facing right now is there have been a lot of efforts by people in congress over the years to find efficiencies and the whole system seems to find a way around them and we need to constantly police these things and I think we have work to do in this committee. Senator kaine? >> senator hickenlooper.
▶ 1:25:36Sen. Husted: Senator hickenlooper.
▶ 1:25:39Sen. Hickenlooper: Appreciate that Mr. chair. I thank each of you for spending your time here, for all the work you are doing. I want to start talking a little bit about the recent so-called one big beautiful bill and the cuts to what will translate into a major cost and dramatic drop in coverage.
▶ 1:26:07Sen. Hickenlooper: Senator sanders is not here but I am a believer that we should be able to get everyone health care coverage. How we get there is hotly debated. People believe in community health centers. But if you take away medicaid or genetically cut it, that is the primary source of revenue for so many of those institutions. Since we are limited in time I want to go into the transparency issue because this is critical.
▶ 1:26:36Sen. Hickenlooper: Almost every thing we discussed, if we had a fully transparent system, whether we are talking about pharmaceutical costs or pbm's, a transparent system allows us to assess especially as several of you have mentioned, allows businesses that are actually paying for the insurance for their members to actually really see what is going on and address how to correct it. That market there is important.
▶ 1:27:05Sen. Hickenlooper: I am with senator marshall on the patients deserve price tax act -- price tags act. It is not all we need to do. I started working with community health centers 50 years ago. I used to tease senator sanders because I was in print to the letter of the editor saying that healthcare should be a right and not a privilege in 1978 which is 10 years before he was first impressed saying that. Beyond that, what can we do now?
▶ 1:27:36Sen. Hickenlooper: The transparency is a big deal. Ms. deacon, Mr. miller, Dr. ippolito, do you think the bills like patients deserve price tags act will further expand transparency and bring down costs? We will start with Ms. deacon.
▶ 1:27:57Ms. Deacon: Thank you. I absolutely believe that the bill patients deserve price tags can be a monumental shift as far is transparency on hospital pricing, expanding transparency but especially for someone focused on the employer space, it will be transformational or employers and their ability to exert the market power that they should have to lower costs.
▶ 1:28:28Ms. Deacon: >> Dr. miller?
▶ 1:28:31Dr. Miller: Absolutely. It is unethical for us to not have price transparency.
▶ 1:28:37Dr. Ippolito: I will agree and it helps us when we think about designing policy. Better information helps us.
▶ 1:28:48Dr. Gaffney: Price transparency would be fine. It would not do anything for the 27 million are currently uninsured or people with high deductibles. I think it is useful. >> fair enough. Mr. potter?
▶ 1:29:06Mr. Potter: I think it would be helpful. Buying big clinics with things like that, there is a lot of need for transparency across the board. I think employers should be able to get their claims data. Some employers have had to sue their carriers and not successful because of current law. >> absolutely. We look at all the different places where the lack of transparency gets in the way of value and the assessment of value.
▶ 1:29:38Mr. Potter: When you have transparency, you can move toward better quality and measuring quality has to be part of this as well. Mr. potter, your testimony mentions the rising costs of medical debt. That should alarm all of us. It greatly concerns me.
▶ 1:29:54Mr. Potter: Do you think increasing price transparency for hospitals and insurance agencies in our bill as well as the pbm reforms are committee has worked on and other things, do you think that will reduce the amount of medical debt that patients face to get these things done?
▶ 1:30:11Mr. Potter: It should. The affordable care act allows families to be on the hook for getting close to $20,000 per year in out-of-pocket expenses. That needs to be addressed. Yes, transparency, reducing -- more transparency of the list price was noted. People have to pay out-of-pocket based on a high price. Transparency should be helpful here.
▶ 1:30:38Sen. Hickenlooper: I appreciate that and appreciate all of your work on this. I want to make clear that I believe everyone should be able to go to the doctor and have a medical hull. The cuts that were recently passed in the reconciliation package are disastrous.
▶ 1:30:57Sen. Hickenlooper: Getting rid of so many of the subsidies from the affordable care act, we will deprive many millions of people from the coverage they deserve as americans and human beings. I yield. >> thank you so much senator hickenlooper. Over here. Now we are down to business. Thank you for all of you taking the time to be here today.
▶ 1:31:23Sen. Hickenlooper: I will let all of you know that in preparation for today's hearing my staff said we have some really heavy hitters. You should all feel complemented. We are grateful for your time. We can all agree that no matter what side of the aisle we have to address costs in health and certainly the burden that we put on the taxpayer to pay for healthcare.
▶ 1:31:48Sen. Hickenlooper: It is estimated that the outlays in federal spending for healthcare costs is now almost 40% of what we put out in terms of money. As a former attorney general of florida, one of the things that continued to frustrate me was watching the money that was spent and put out on unnecessary services, unnecessary
▶ 1:32:20Sen. Hickenlooper: Medications, unnecessary nights in the hospital because somebody had really good insurance that they could bill. And really unnecessary products. So there's this gray area within a legitimate structure of government assisting with healthcare where it could be available -- debatable whether someone needs an extra day in the hospital or a medication or
▶ 1:32:50Sen. Hickenlooper: Product. Then there is this whole of the area of outright fraud where there is not even a patient out there but the government is getting charged for a product and there was never a patient. Or companies that are brought into deliver account ability in healthcare are having to pay out a lot of outright fraud. As attorney general, we were up to going after about $200 million in fraud. Think about the burden on the taxpayer.
▶ 1:33:22Sen. Hickenlooper: Teachers and truck drivers and people trying to put food on the table and fight for their family having to spend money for health care and a lot of that is going to criminals. We can talk about fixing the structure of healthcare so that it is more efficient and there are so many ideas for that. I will talk about fraud. The fraud that is involved in the healthcare system right now, I don't think the average american understands what they are paying.
▶ 1:33:53Sen. Hickenlooper: Or what the government is paying in fraud. That drives up premiums. It drives up deductibles. It drives up costs. I want to talk about that for a moment, detection and reporting. A lot of times we have to rely on the patients to report who sometimes don't even understand that they are -- that there is fraud. And the detection is often a problem.
▶ 1:34:23Sen. Hickenlooper: I want to talk about that for a moment. I have heard of accountable organizations that estimate they are paying out tens of millions in fraud and they are actually finding that they have paid for products and there was never a patient. I think I will start with you Dr. ippolito. Can you talk to me about improving detection and reporting of outright fraud?
▶ 1:34:52Sen. Hickenlooper: Criminals who have learned the system and are taking advantage of a complex system and ultimately putting the burden on taxpayers.
▶ 1:34:57Dr. Ippolito: It is a big question. My mind goes from florida. Medicare struggled for a long time and traditional policing fraud. It speaks something that the senator mentioned earlier. Zero administered of costs is not the goal. We want costs because we want to do what you are talking about. We want to police the care being used not to tell doctors how to behave but to make sure this is accurate care.
▶ 1:35:25Dr. Ippolito: I think that is an example of an area where we have very little oversight and we rely on some pretty ad hoc detection mechanisms as you mentioned. It is certainly a role for them in the big federal programs.
▶ 1:35:41Sen. Moody: I know you want to jump in here. You are just anxious. Go ahead.
▶ 1:35:46Ms. Deacon: One of the biggest problems with detection and reporting is we have so many situations where the foxes guarding the hen house in healthcare, where it does not benefit a company or somebody who might be seeing the fraud and patterns and provider behavior, they may not report because they are financially benefiting from the fraud occurring.
▶ 1:36:14Ms. Deacon: Again, whether that's on the pbm side or the carrier side, we have way too many foxes guarding the hen house which leads to lack of notice and fraud detection.
▶ 1:36:29Sen. Moody: I know you want to jump in but Mr. cassidy would probably yell at me if I go too far. I will leave that to him and maybe you can add that to another response.
▶ 1:36:40Chair Cassidy: Senator hassan.
▶ 1:36:42Sen. Hassan: Thanks Mr. chair. Good morning witnesses. Thank you for your engagement on these issues. I want to start with a question to you Dr. gaffney. Patients across the country continue to pay high prices for prescription drugs. Democrats passed the inflation reduction act in 2022 which gave medicare the ability to negotiate drug prices for the first time.
▶ 1:37:07Sen. Hassan: Thanks to the first round of negotiations seniors will see lower out-of-pocket prices for 10 drugs beginning in 2026 including medications that treat high blood pressure, diabetes and heart disease. Republicans opposed the inflation reduction act in 2022 are working to undermine the program starting with a move to exempt certain drugs from negotiation as part of the republican budget bill that just passed. This will make some drugs like cancer drugs more expensive for seniors in the coming years.
▶ 1:37:39Sen. Hassan: What will the impact be on seniors with cancer if their drugs become more expensive as a result of the republican budget bill?
▶ 1:37:45Dr. Gaffney: It is not rocket science. When the price of drugs goes high pocketbooks, they go without them. I could mention numbers of studies mentioning that. People sometimes die. There was a recent study that showed even low co-pays called people to go without medications. It would be a harm to their health.
▶ 1:38:08Sen. Hassan: Thank you for that. Dr. miller, one concerning trend that drives up costs is the practice will be something that senator cassidy has already talked about this morning is the prices -- practice where providers charge hundreds of dollars in extra hospital facility fees or fees at outpatient facilities. One of my constituents had a regular appointment with date neurologist that was covered by their insurance.
▶ 1:38:36Sen. Hassan: But he was charged an additional and separate $1000 room fee by the hospital. So he sees this meteorologist -- urologist like it's a $1000 bill. Can you speak to the overall impact on patients when they can afford their care?
▶ 1:39:00Dr. Miller: The impact is terrible. How are you supposed to know that one of the thousands of clinics that has a facility fee and is located more than 250 yards from the hospital and less than 35 miles was acquired before november 2, 2015? There is zero transparency.
▶ 1:39:21Dr. Miller: As a patient and you see one of those sites, you are paying 70% more was no added clinical value and no economic knowledge that you are incurring that cost. It is terrible.
▶ 1:39:33Sen. Hassan: I appreciate the clarity there. Several states have banned facilities fees. Senator cassidy and I have been working on this together. I hope the whole community will be engaged. Dr. gaffney, the republican budget bill cut more than $1 trillion, picking millions of americans off of their coverage in the coming years.
▶ 1:40:00Sen. Hassan: How will the cuts impact health care costs for all americans including americans who are covered by group or employer insurance?
▶ 1:40:06Dr. Gaffney: There will be a multitude of effects. Premiums for people with aca marketplace plans are expected to surge in the coming year. Healthcare prescription drug prices will increase many low income seniors with medicare as a result. For patients who are uninsured, costs are going to soar because they will be hit with the full freight of the hospital bill. Finally we have to incorporate the health impact. Not only talking about dollars and cents.
▶ 1:40:37Dr. Gaffney: I am expecting more patients with life-threatening complications of common chronic conditions because they did not get the care they need and that costs something but it also is far worse when someone dies as a result.
▶ 1:40:47Sen. Hassan: I appreciate that. I will follow-up with one other area of concern because I've heard about it from the head of the american academy of pediatrics or at american pediatric association. For those types of care like pediatrics which are covered a lot by medicaid.
▶ 1:41:08Sen. Hassan: A good portion of the pediatric population, without medicaid dollars to support those patients, there is a real possibility not only of the maternal health deserts that we already have in this country, but of pediatric health deserts. Have you done any work on that?
▶ 1:41:23Dr. Gaffney: I have not done research myself on that but we know these cuts can be devastating for the safety net providers both in rural areas and suburban and urban that take care of working-class low income people. What these providers get a lot of the revenue that they use to take care of patients from medicaid. What happens when medicaid gets cut by $1 trillion? We can all do the math. They will either cut services, cut staff or close. It is not rocket science.
▶ 1:41:51Sen. Hassan: I appreciate that even though it is very stark. Thanks Mr. chairman.
▶ 1:41:59Chair Cassidy: Thank you senator hassan. I would like to ask unanimous consent to enter several statements into the record. So ordered. Thank you all for being here. Really appreciate it. Eliminating for the folks here and the folks watching. I found there were common themes across everybody from Dr.
▶ 1:42:24Gaffney: To Mr. potter and parts in between. For any senator wishing to ask additional questions, these will be due by 5:00 p.m. On thursday, august 14. Again, thank you for being here. This committee stands adjourned.
▶ 1:43:03Gaffney: [captioning performed