By Erica Hahn, Abigail Knapp, Leila Sullivan, and Kennah Watts
On October 29, Georgetown University’s Center on Health Insurance Reforms (CHIR) hosted an event discussing the rise of health care corporatization and how it has directly contributed to higher health care costs, sponsored by Arnold Ventures. The event featured remarks from Senator Roger Marshall, Linda J. Blumberg of CHIR, and Celinda Lake of Lake Research Partners, as well as a panel discussion moderated by Maya Goldman of Axios. A recording of the event can be found here.
Senator Marshall Emphasized How Patients Deserve Fair, Affordable Prices and Spotlighted Bipartisan Support for Reform
Senator Roger Marshall (R-KS) affirmed his commitment to reduce the cost of health care, drawing on his experience in different roles within the health care system. Senator Marshall identified three key focus areas to address health care costs: First, he explained the value of providing patients with clear information about the price of health care services and efforts in Congress to improve transparency. Second, he called for curtailing the misaligned profit incentives of middlemen, particularly pharmacy benefit managers, that drive up prices. Finally, Senator Marshall emphasized the importance of combatting chronic disease.
Speakers Underscored the Growing Complexity of Health Care Financial Interests and Consumers’ Support for Reform
Dr. Linda Blumberg, research professor at CHIR, opened the event by describing how different forms of consolidation are driving up health care costs. Horizontal integration, such as hospital mergers, and vertical integration, such as hospitals acquiring medical practices, have reduced competition and led to rising prices. She further highlighted the growing influence of private equity in increasing spending while lowering the quality of care provided. Dr. Blumberg described a “complex web of intertwined financial interest” amongst various stakeholders including providers, insurers, and third-party administrators, including emerging “middlemen” industries that prioritize revenue over value and quality of care. These profit-driven, corporate strategies often lead to anti-competitive behavior and unfair billing practices, without gains in care quality. This complexity goes beyond horizontal and vertical integration, and makes cost containment efforts increasingly difficult. She emphasized how developing effective policy solutions requires understanding these intertwined financial incentives connecting the stakeholders.
Celinda Lake, president of Lake Research Partners, shared national survey findings regarding public interests in addressing the rising health care costs. According to her research, a strong majority of Americans view health care in this country as unaffordable, and voters across party lines –– 97 percent of Democrats, 85 percent of Independents, and 76 percent of Republicans –– think that health care reform is an important issue that candidates need to offer solutions for. Unlike the attitudes prior to the Affordable Care Act (ACA), voters are increasingly seeking a more affordable and accessible health care system for themselves and for their families. This bipartisan concern for health care costs makes health care a decisive voting issue.
Panelists Provided Perspectives on the Effects of Rising Costs for Patients and Providers, and Offered Potential Policy Solutions
Four panelists, moderated by Maya Goldman, discussed their perspectives on corporatization and highlighted its effects on patients and providers:
- Dr. Vicki Norton, an emergency medicine physician and President-Elect of the American Academy of Emergency Medicine, explained how consolidation leads to loss of physician autonomy as providers are increasingly evaluated by financial metrics rather than quality of patient care.
- Anthony Wright, Executive Director of Families USA, emphasized the financial burdens imposed on patients––whether through cost sharing or lost wages––as well as mounting patient frustration and distrust in a more complex, profit-driven system that often leads to delays or denials of care.
- Jasmine Masand, Deputy Legislative Director for Senator Hassan (D-NH), highlighted how many patients do not understand the bills they receive; either what the charges mean or what they are expected to pay.
- Max Seltzer, Health Policy Director for Senator Marshall (R-KS), underscored how patients deserve “price tags” and transparency for the cost of services.
When asked how to mitigate corporatization and improve affordability, the panelists offered a myriad of policy reforms. Masand and Seltzer highlighted two federal policy proposals that aim to make health care prices and billing more transparent. The Patients Deserve Price Tags Act – introduced by Senators Marshall and Hickenlooper – would expand and improve the price information that providers and insurers must post for health care services and ensure that group health plans have access to their claims data. The Fair Billing Act – introduced by Senators Hassan and Marshall – would require hospitals to use unique billing identifiers to help ensure that patients’ bills accurately reflect where they received care and strengthen efforts to curb facility fees. The panelists emphasized that these bills are an essential “entry point” to addressing rising health care costs: While transparency alone may be insufficient, it provides the visibility and data necessary to support broader, more systemic reforms.
The panel further noted that there has been considerable state-level action to protect the physician-patient relationship from corporate interests. Many states, including Oregon, California, and Texas, have enacted corporate practice of medicine laws, which prohibit non-physician-owned corporations from practicing medicine or employing physicians. According to Dr. Norton, in states like Florida where there are no such regulations in place, private equity acquisition of imaging centers and other health care facilities has led to declining quality of care. While not explicitly discussed in the panel, states have also taken action to improve ownership transparency, monitor hospital consolidation, and use reference-based pricing to contain cost growth.
The panelists agreed that while state-level innovations are important, federal action is crucial to seal the patchwork of the state laws and ensure nation-wide protection and impact. Speakers’ and panelists’ insights highlighted health care affordability as a primary concern for consumers and underscored bipartisan support for strategies to contain costs
A recording of the event can be found here and you can sign up for our mailing list to receive more information here.
