Hospitals seek help from Congress, and face tough questions

Healthcare leaders appeared before Congress to discuss the problems of affordability and access, and hospitals faced scrutiny from some lawmakers.

At a House Energy & Commerce Committee hearing Wednesday, Rick Pollack, president and CEO of the American Hospital Association, talked about the impact of cuts in Medicaid slated to take place over the next decade.

He said the cuts will have a big impact on patients and hospitals.

“We've been very vocal in expressing our concerns relative to the impact of the significant Medicaid cuts that are now coming down the pike,” Pollack said. “And so it's an enormous concern.”

U.S. Rep. Raul Ruiz, a California Democrat and an emergency medicine physician, said hospitals are going to face serious pressures from cuts in Medicaid and the expiration of the Affordable Care Act tax credits.

And that will lead to insurance companies raising prices and all Americans paying more for care.

“They're going to raise premiums across the board, for employers, for small businesses, for people with private health insurance. So suddenly, everybody is paying more,” Ruiz said.

Ruiz warned of some hospitals likely having to cut services, and he stressed that affects more than those relying on Medicaid.

“If the hospitals don't provide those services, …. You're out of luck, okay, because you're not getting the care,” Ruiz said. And he warned that some hospitals could end up closing altogether, worsening access to care.

But hospitals also faced tough questions from lawmakers on the committee, with criticism about confusing costs of care.

Price transparency

U.S. Rep. Brett Guthrie, R-Kentucky, the chairman of the House Energy & Commerce Committee, pointed to a recent $28,000 hospital bill for his wife. They ultimately paid $500, and he said he bragged about the high quality care she received.

But he said Americans can’t understand how much they pay for hospital care, and employers who pay for health coverage can’t easily compare pricing.

“We're trying to get price transparency. You can't figure out what anything costs,” Guthrie said.

Elizabeth Mitchell, president and CEO of the Purchaser Business Group on Health, pointed to the need for greater price transparency from hospitals.

“Pricing is utterly irrational, and it is not related to quality. It is not related to safety. It's basically whatever a hospital can charge and get away with,” Mitchell said.

“A basic step forward would be to require them to fully comply with the existing rules and make the price information totally available. Because … you can't make an informed decision without information,” she added.

Rep. John James, a Michigan Republican, also complained that hospitals aren’t doing enough to offer clear pricing for Americans.

“We don't fix affordability without fixing accountability, and we don't get accountability without transparency,” James said.

Hospitals also have been looking to preserve the federal 340B Drug Discount Program, which allows hospitals and health systems to buy outpatient drugs at lower costs.

Pollack said the program has helped hospitals pay for programs including behavioral health, home health, and substance abuse services in underserved communities.

Rep. Buddy Carter, a Republican from Georgia, said the program has grown far beyond its intended purpose of helping hospitals with modest resources. Carter said the program was aimed at rural hospitals and Federally Qualified Health Centers.

Pollack quickly interjected that the program also provides critical assistance to inner city hospitals.

Carter has sponsored legislation to reduce the scope of the 340B program. He said he’s not trying to dismantle the program but ensure it is targeted to people with lower incomes and hospitals that genuinely need help.

“I know that the hospitals have become dependent on this,” Carter said, adding, “This is masking the cost of other things I can’t see.”

He told Pollack, “I want to help you. I know you’re losing in other areas.”

Primary care

Shawn Martin, CEO of the American Academy of Family Physicians, also testified at the hearing and pointed to the need to investing more in primary care to drive healthcare costs down.

“To truly reduce the cost of health care, we must invest in health and health starts with primary care,” Martin said.

Rep. Diana DeGette, a Democrat from Colorado, asked Pollack about the impact of more Americans losing coverage under Medicaid and the Affordable Care Act, and if that will lead to more patients turning to hospital emergency departments for care.

Pollack said, “We've become the family doctor to the uninsured.”

“The real concern that we also have is that it will just clog already overburdened EDs, and there'll be longer wait times, and that affects everyone …. Certainly, if people don't get the care on the front end that you could have prevented, and then they end up at the ED, that's not good for the patient.”

Hospitals also received criticism for increased consolidation of health systems as a factor in driving up costs.

‘Fix what’s not working’

Dr. Anthony DiGiorgio, an assistant professor of neurological surgery at the University of California-San Francisco, appeared before the committee and urged lawmakers to allow the opening of physician-owned hospitals to give patients more choices. Federal law has prevented the opening or expansion of physician-owned hospitals since 2010.

“Physician-led facilities are one of the last practical checks on consolidation in American health care,” DiGiorgio said. “They preserve patient choice, create local price competition and maintain accountability through direct patient-physician relationships, rather than through distant corporate hierarchies.”

Hospital trade groups contend that physician-owned hospitals don’t provide the scope of services of community hospitals, and they don’t serve as many patients with complex conditions. They also note some physician-owned hospitals don’t provide emergency departments.

Charlene MacDonald, president and CEO of the Federation of American Hospitals, said in a statement that hospitals see the “affordability crisis,” and added, “It's time to fix what's not working.”

“Lowering patients' costs requires coverage that actually works —and that means addressing benefit designs that leave patients exposed to high out-of-pocket costs and bringing real accountability and transparency to how vertically integrated insurers are using premium dollars,” she said.