The Senate Committee on Health, Education, Labor, and Pensions will please come to order. For the awareness of the minute uh the members, Senator Paul is two minutes out, so we can go through a lot of this and he'll come in and vote will be out. And for the awareness of members, your presence here will be considered as being present at
Gavl Down for the hearing itself. Uh we reconvene to consider our vote on Scott Mayer to be a member of the National Labor Relations Board and Mary Anne Carter to be chairperson of the National Endowment for the Arts. Uh I defer to Senator Sanders for an opening
statement. Thank you, Mr. Chairman. Uh I'll be voting against both of these nominees. First, uh as I think we all remember, several months ago, President Trump illegally fired NLRB member Gwyn Wilcox. In doing so, Trump effectively neuted
the only federal agency responsible for holding corporations accountable for union busting and protecting the constitutional rights of workers to form unions. Before Miss Wilcox is reinstated to the NLRB, I believe it would be inappropriate for us to be voting on any
new members to this board. Secondly, all over this country, workers are standing up trying to form unions. They are looking at an economy in which the people on top are doing phenomenally well and they are struggling to put food
on the table, pay their health care, pay their rent. I was just on a picket line a few days ago with workers at Starbucks. They have been trying to form a union for the last four years against incredible illegal union busting
activities. We need an LRB in this country that does what it was designed to do to stand up for workers who are being treated unfairly by the companies they work for. So I would urge a no vote uh on that nominee.
>> Senator Quorum is present. I'll now move to favorably report Mr. Mayor's nomination. The clerk should call the role. >> Senator Paul, Senator Collins, >> hi. >> Senator Marowski, Senator Mullen, >> hi. >> Senator Marshall, >> Senator Scott, >> hi. >> Senator Holly, >> Senator Terville,
>> Senator Banks, Senator Houston, >> Senator Moody, Senator Sanders, >> no. >> Senator Murray, >> Senator Baldwin, no. >> Senator Murphy, >> no. By proxy. Senator Kaine, Senator Hassan, >> Senator Hickinlooper,
>> no by proxy. >> Senator Marky, >> no by proxy. >> Senator Kim, >> Senator Blunt Rochester, >> no by >> No by herself. >> Senator Senator Olsen Brooks, >> no by proxy. >> Chairman Cassidy.
>> Senator Cassidy is an I and Senator Palm to be right here. TV. That was awesome. Senator Paul >> have 12 eyes, 11 nazs. The eyes have it. The nominations agreed to will be favorably reported to the
Senate. I now move to favorably report Miss Carter's nomination. The clerk should call the role. >> Senator Paul, >> Senator Collins, >> Senator Marowski, Senator Mullen, >> I by proxy,
>> Senator Marshall, >> Senator Scott, >> Senator Holly, Senator Silver, Senator Banks, Senator Houston, >> Senator Moody, Senator Sanders. No. >> Senator Murray, >> Senator Baldwin, >> Senator Murphy,
>> no. By proxy, >> Senator Kaine, Senator Hassan, >> Senator Hickinlooper, >> no by proxy. >> Senator Marky, >> no by proxy. >> Senator Kim,
>> Senator Blunt Rochester, >> Senator Olserbrooks, >> no by proxy. >> Chairman Cassidy, >> hi. 14 eyes, nine nazs. >> The eyes have the nominations agreed to will be favorably reported to the Senate. The help committee stands
adjourned. For those who came in late, your presence at the executive session establishes your presence at the committee hearing the proxy. It still counts. But because Sure.
>> Sorry. The Senate Committee on Health, Education, Labor, and Pensions will please come to order. I think it's pretty well established the American people are having a hard time affording healthcare. Prices are up for everyone and the
status quo is not sustainable. And they are looking to Congress to work together to find solutions. In July, this committee discussed affordability across the entire commercial insurance market. Today, we're looking at why costs are going up
so much within the individual and small business marketplaces. Because if you're in those marketplaces, you're paying more and you're getting less. During the COVID pandemic, Democrats passed extended temporary enhanced premium tax
credits or EPTC's which ultimately send money to giant highly consolidated insurance companies. And I'm not knocking insurers as they're essential to our society. I'm just pointing out and by using these subsidies, they were
hiding the true cost of the premiums. Now, this doesn't actually lower the cost of health care. It mask it. It papers over it. It puts a band-aid on a broken bone. Now, let's get some facts. In 2014,
taxpayers covered 68% of the Obamacare exchanges enrolles premiums. By 2020, that 68% had become 80%. From 2021 to 2025, the era of the enhanced premium tax credits, if you
will, the taxpayer share grew to 93%. Now, despite this increase in subsidies, total premiums never decreased. The enhanced premium tax credit just masked the cost. In fact, increased subsidization actually increases the
price for the unsubsidized and the small group market when they are included in the same actuarial pool. Think about that. Subsidizing the sum increases the premiums for those who are not subsidized but who are in the same
actuarial pool. Now how do we address this? We should go to the root cause of rising health care cost. Now to be sure we're having two conversations here.
One, how do we lower health care costs going forward? Period. just from here to eternity and a very immediate conversation about January 1, 2026. What do we do for those folks, particularly those who are in their 50s
and their 60s on the exchanges for whom the premiums have become unaffordable and because of their increased use of health care have to put more of their budget to this. Now, Republicans are not interested in the status quo. We want I
can tell you as a doc, putting a band-aid over a broken bone does not help anything. But Republicans are absolutely interested in figuring out a solution that can make health care more affordable and health insurance more
affordable from 2026 and beyond. Now, I'm speaking to both sides of my dis right now, my Democratic and Republican colleagues. I'm hoping that we can find a bill that can get 60 votes that can fix the
problem of the exchanges for January 1, 2026. It shouldn't be a Republican solution. It shouldn't be a Democratic solution. It should be an American solution. And this is a committee of jurisdiction. So, I'm asking us not to yell at each other.
Not that we do, maybe occasionally, but let's find a solution because the American people are looking at us to find a solution. Now, we can push for big ideas, grandiose ideas on the right or the left, but we got to have a solution for
three weeks from now. So, Senator Sanders will speak about Medicare for all. that will not be ready in three weeks. In fairness, people on my side will speak about things that cannot be ready in three weeks. We
should focus our minds on what can get done by three weeks from now. Now, that means we have to build on what we have. Neither side's going to particularly like that, but if we're going to do something in three weeks, we got to do it in three weeks. And if you
want an American solution, not an RRD, that is the reality. Now, there is a sweet spot that which Republicans and between that which Republicans and Democrats would like to do, knowing that we have to have a solution in three weeks. We've got three choices. We can
do nothing. We accept the premise that no deal is possible. That the enhanced premium tax credits go away. That no reforms are made to a failing system. And we have a failed floor vote where there's a Democratic bill and a Republican bill and they both go down
and the American people are not served. That's one option. Alternatively, we can roll up our sleeves and seek out something we can all live with. Now, from my perspective, that recognizes that increased support
for some patients, for some people, must continue. It also though includes shifting dollars away from the current structure of the enhanced premium tax credit, a 100% of which goes to insurance companies, and repurposing those dollars for prefunded
health savings accounts paired with the bronze plan. Because when you put it in an HSA, a 100% goes to the patient. By the way, when you give it to the insurance company, 20% of that goes for overhead and profit. when you give it to
the patient, 100% goes for the health care they need. Now, let's address the elephant in the room or in respect to my Democratic colleagues, the donkey. There are people with strongly held positions on the issue of life,
our choice on both sides. Let's just acknowledge that and let's have an honest conversation. I am pro-life and I'm not going to compromise that. And I know people are pro-choice and they don't wish to compromise that. But we found ways through the annual appropriations
process to find common ground for many years. So let's just not say right off the bat, oh, we can't address that and then allow the people in their 50s and 60s to have unaffordable premiums. Let's try and find a way that we can all live with this incredibly important issues
issue, no matter what side of that issue you are. Now, President Trump supports the concept of this third approach, which clearly strengthens its chance of passing. I'm pleased to say I've had Democratic colleagues in both chambers with whom I've had productive
conversations. Again, they want an American plan, not a sidebyside Republican and Democratic set of plans, both which fail. Like, so much fails here in Congress. The American people want something to pass. So, let's find something to pass.
Let's give power to the patient, not profit to the insurance company. Let's make health care more affordable again. And with that, I recognize Senator Sanders. >> Thank you very much, Mr. Chairman. Thanks to the panelists for being here. Uh, and thank you for holding this
important hearing and I agree with some of what you said. Hard to dispute that the current health care system is completely broken. It is dysfunctional and it is cruel. I think most Americans recognize that
the function of the health care system today is to make the insurance companies incredibly wealthy. Provide huge compensation packages to their CEOs, make the drug companies extremely profitable, provide huge compensations
to their CEOs, massive amounts of stock buybacks. That's what the system is about. So for the drug companies and the insurance companies system is working really great and that is what it is designed to do. Unfortunately for the rest of the American people system is
not working very well. What does that mean? It means unbelievably Mr. Chairman as a nation we are spending $15,000 per person today on healthcare. adding
everything together, family of four, $60,000. So if you're spending $15,000 per person, you must be getting the best health care system in the entire world, right? Everybody in America has high quality health care, go to any doctor
they want, lowcost prescription drugs, because we're spending twice as much per capita. Well, not quite the case. The reality is that despite spending $15,000 per person, we got 85 million
Americans who are uninsured or underinsured. What does that mean, Mr. Chairman? It means that if you are underinsured or underinsured, you get sick, you don't go to the doctor. And you know what happens when you don't go to the doctor? When you get sick, sometimes you die. And
there are estimates that in the richest country in the history of the world, some 60,000 Americans die every single year because by the time they walk into a doctor's office, it is too late. Now, clearly in the richest country in the history of the world, our life expectancy is higher than other countries. Right? Wrong. Four years
lower than OECD countries. And if you're working class, it is a lot lower than that. Clearly in America, richest country on earth spending all this money. We have more doctors and nurses and psychologists and dentists. We are all you go to anytime you want. You have to wait online. Well, not quite the
case. We got a massive shortage of doctors, nurses, dentists, mental health providers. So, what is the bottom line? Mr. Chairman, I appreciate very much your sentiment about wanting to do something quickly. And the reason for
this hearing, to be frank, is that my Republican friends understand they got a political problem. And what is their political problem? Their political problem is that all over America today, people in on the Affordable Care Act are opening up packages coming from the
insurance companies. And guess what? Their premiums on average are doubling in some cases in my state, tripling or quadrupling. And if I'm a Republican, frankly, I don't want to go back to my district and explain to people why their ACA premiums are doubling or tripling.
So, Mr. Chairman, yes, current system is broken. Yes, we need to create a new system, but unfortunately, we aren't going to do it in two weeks. You're not going to undo the current American health care system. So, what should we
do? Well, but common sense would suggest, okay, you got a broken system, but you and I, I think, agree you don't want to see people seeing a doubling in their premiums. So, let us extend the current ACA tax credits for at least another year, two years, three years.
While in fact, and I'd love to work with you on this, in this committee, we tackle the real issues. And by the way, if we're going to tackle the real issues, the first thing I think that we should do, Mr. Chairman, and I mean this very honestly, is have a panel with
people from different countries around the world who are a providing health care to all of their people as a human right and we are the only major country on earth that does not do that. and say to the people in France, in Japan, how do you manage to provide quality care to
all of your people at half the cost that we do in the United States? What can we learn from other countries? I I think that would be the first approach and we can argue from there. But anyhow, I think the immediate test is to as as bad as the current system is, we don't want to see a doubling, tripling of premiums.
We got to extend those and then let's sit down and develop a system that works for the American people, not the insurance companies, not the drug companies. In my view, in Dr. Fagen's view, the answer is in fact going to be to emulate what many other countries do. Guarantee health care to all people by
extending Medicare in this country, Medicare for all. The reason the reason people are uninsured is because they have $6,000 deductibles. As a doctor, I know that was a barrier to care. That is the status quo. We can change that
status quo for next year. >> Want people to be underinsured. >> All right. Can you change that status quo and make sure we do like every other country does and guarantee healthcare to all people with virtually no out-of- pocket expense? >> So, if there's going to be a big idea, that will not happen by January 1, 2026.
It is something we can consider for 2027 or beyond, but I'm focused on 2026 because that's where the immediate need is. >> And if that's what we're going to do, let's extend tax credits and then let's have that discussion. >> So people remain unins underinsured. >> Your program is not going to guarantee health insurance to all people.
>> We will not accept that. >> We will not accept the doubling of premiums. >> Good. Then maybe we can have common ground. That's the common ground. Let's proceed. Uh, I will now introduce our first witness, a good man.
Where is my We're joined today by Joel White, president of the Council for Affordable Health Coverage. Mr. White has over two decades of experience in health policy and has led national coalitions focused on lowering health care cost and improving market competition. He has
expertise in insurance markets, benefit design, and reforms to expand affordability for patients and small business. He's a graduate of American University where he owns where he earned a bachelor's in economics. Mr. White, thank you for being here.
Uh, thank you, Chairman Cassidy, Ranking Member Sanders, members of the committee for the opportunity to testify today. My name is Joel White. I lead the council for affordable health coverage. Our mission is pretty simple. We want to ensure that every American has access to affordable coverage. Um, and I'm here to
say the cost of health care is a threat to our economy. It is an escalating burden on our families and businesses. It's a ticking time bomb for the federal budget. and it's unsustainable for the United States of America. And those words were said by
President Obama in 2009. They were true then and they're true today. The problem is the situation today. It's even worse. Healthcare is becoming less affordable, less competitive, and less responsive to consumers. Premiums and out-of- pocket
costs keep rising while choices narrow, and consumers pay more for less. The ACA forced people into expensive, more restrictive plans and pushed 12 million small business employees out of better employer coverage and into higher cost
exchange plans. Since enactment in the ACA, individual market premiums more than doubled, twice the pace of employer coverage. Out-of- pocket costs doubled as well. Next year, exchange premiums are projected to jump 26% driven by
medical inflation and the structure of the law. And premiums are only the start. Even after paying record high premiums, families must spend thousands of dollars before coverage even begins. When they finally access care, they face friction
and delay from prior authorizations, narrow networks, and restrictive drug formularies. Taxpayers and working Americans finance these high premiums and high deductibles that pay for shrinking access while local hospital and insurance monopolies
grow stronger. Simply put, the ACA poured gasoline on the healthc care cost fire. The system is unsustainable for families, for businesses, for taxpayers. It's a major driver of deficits and debt. And adding more subsidies won't
fix these underlying problems. It only reinforces them. So relief from the ACA's high costs requires a different approach, one that empowers consumers, not corporate America. First, I suggest you make subsidies
portable. Let individuals use federal tax dollars to buy coverage or care arrangements that work for them. first dollar coverage, direct primary care, lower premium plans, services at transparent cash prices. Depositing
subsidies into HSAs that patients own and control would give them real purchasing power and force plans to compete on price and quality. In every market across America today, there are health plans that are less expensive than the ACA policies. If
consumers were empowered to shop and use their subsidies for alternative plans, competition would drive down costs and access to care would improve. Second, it's absolutely imperative that we help small businesses.
They face the highest premiums and the fewest choices. Updating the broken small business tax credit and expanding options like association health plans would let them offer coverage again. The small market, small
group market is currently in a death spiral. Just a third of small businesses offer coverage today. Used to be 50%. Half the exchange market is made up of small business employees where they pay higher premiums, higher deductibles, and
they're in an HMO. That is not common in small group market. You could keep people in small group plans and give them better coverage at uh twothirds less costs. Third, we should empower states to bring down costs through accelerated waiverss and high risk pools that have been
proven across America to lower premiums by up to 40%. And then fourth, long-term affordability requires addressing the cost of medical care itself. Local hospital markets are monopolies that drive up prices for consumers and costs for taxpayers. For
too long, we've restricted the supply of local doctors, nurses, and pharmacists. We need policies that promote competition, not consolidation, so prices fall and innovation rises. I think the path forward is pretty clear. Empower consumers, expand choices,
restore competition, and lower medical costs. That is how we make healthcare affordable again. Thank you. Next is from Miss Strauss. Thank you, Mr. White. And
we're joined today by Marcy Strauss, owner and partner of Capital Benefits Group. She has more than two decades of experience helping small business owners navigate rising health care costs and design affordable options that keep their employees and families healthy.
I think maybe even more importantly, she brings a personal perspective as a mom of three who has seen firsthand the realities families face in accessing and affording health care. Thank you, ma'am. >> Chairman Cassidy, Ranking Member Sanders, and distinguished members of
the committee. Thank you for the opportunity to testify today on behalf of millions of small business owners and individuals across America who care deeply about building stronger, healthier communities. My name is Marcy Strauss and I'm a partner and benefits consultant at Capital Benefits Group in
De Moine, Iowa. For more than two decades, I've helped small business owners navigate an increasingly complex health benefits landscape. I've sat across from owners who lie awake at night wondering how they will continue to afford employee coverage. And as a small business owner myself, I understand how an uneven playing field
can hold back growth. I am also the mother of twins with a neuromuscular disease, so I know firsthand what it means to navigate a health care system for loved ones with complex needs. This dual perspective, both as a consultant and as a parent, deepens my understanding of how today's system is failing families and employers alike.
Small businesses and individuals are facing a healthc care coverage crisis. Small businesses are the foundation of the American economy. They represent 99.9% of all US businesses and generate nearly half of our nation's GDP. They coach our kids, support our communities,
and create opportunity every day. A key part of that commitment is offering employer sponsored health coverage. But for four decades, according to the National Federation of Independent Business, the number one problem small business owners report is the high cost of health insurance. Premiums have risen
more than 120% since near since early 2000s. While the number of insurers offering small groupoup plans has sharply declined, it's no wonder that 98% of small business owners fear they will no longer be able to afford coverage in the coming years. The underlying problem is structural. Too
many government regulations and too many industry middlemen separate patients and employers from the care they need. Today, nine out of every $10 spent on healthcare flows through a third party, limiting employers and employees ability to shop for plans that truly fit their needs. It is time for Congress to
legalize healthcare tools that increase choice, flexibility, and affordability. The following key reforms will help to restore affordability and choice. Enact the choice arrangements. Icas are already a valuable tool that let employers contribute towards employees individual health coverage in a
predictable budget friendly way. Passing the choice act would codify and strengthen these arrangements, expand eligible expenses, and offer tax credits for small businesses that use them. This gives employers another sustainable option for providing meaningful benefits. Reform association health
plans so small businesses have the ability to join together across industries to purchase coverage the same way large employers do. Allowing more pooling through AHPS and similar Orisa regulated structures would mean lower premiums, stronger networks, and better plan options. Codify the short-term
limited duration plans to offer affordable, flexible coverage, especially when paired with direct primary care. Removing federal time limits and codifying these plans would expand lower cost options for small employers and individuals. HSAs should be modernized so families can save more, use funds to pay for small group
premiums, and treat HSAs as true long-term health investment tools. This empowers consumers to make smarter decisions and better manage unexpected costs. Eliminate one-sizefits-all ACA mandates such as essential health benefits, the medical loss ratio,
community rating, and the removal of lifetime limits. They have unintentionally contributed to rising cost, fueled industry consolidation, and reduced flexibility. Essential health benefits require businesses to pay for coverage their employees may never use. Medical loss ratios tie insurer revenue
to higher claims, discouraging cost control and contributing to market consolidation. Community rating rules inflate premiums for younger workers, pushing many out of the market and driving up rates. and the removal of the lifetime limits has contributed to uncontrolled cost growth across the
system. Eliminating or at a minimum right sizing these mandates would help bring premiums back in line with what small employers and families can afford. In conclusion, small business owners must budget carefully each year to provide health care to their employees. Many feel trapped as premiums continue
to rise and options dwindle. Yet the private market is already developing innovative solutions, international drug sourcing, biosimilar programs, negotiated surgical rates, and more. When government barriers are reduced, these tools can work not just for large employers, but also for the smallest
groups, including those with fewer than 25 employees. Thank you for the opportunity to share my testifi, and I look forward to answering your questions. >> Thank you. I ask Senator Sanders to introduce his witness. >> Thank you, Mr. Chairman. I'd like to introduce Dr. Claudia, Dr. Dr. Claudia
Figan, National Coordinator of Physicians for National Health Program. Dr. Figgan recently served as chief medical officer of Cook County Health in Chicago and as a past president of the Health and Medicine Policy Research Group. Dr. Figgan, thanks so much for being with us. >> Thank you,
>> Ranking Member Sanders, and all the members of the uh Senate Health Committee. I want to thank you for the opportunity to address the issue of healthc care affordability. My name is Dr. Claudia Fegan. I am the national coordinator of physicians for a national health care health health program.
Everyone in this room knows that health care the US health care system does not work. It does not meet the needs of the American people. An expanded Medicare for all system as proposed by Senator Sanders would solve many of our problems related to cost the cost of health care.
We could have highquality, trustworthy, universal health care that is free from profit-driven conflicts of interest and delivers better health outcomes for Americans. Without enhanced tax premium credits, Americans will die. The subsidies that establish subsidies
established in the Affordable Care Act expanded in the American uh Rescue Plan Act allowed workers to purchase health insurance, saving lives. When 10 million people lose Medicaid coverage because of the changes in the Republican reconciliation bill, over 42,000 more
people may die as a result. I've practiced internal medicine for over 40 years, the last 25 years at Cook County Health, the third largest public health system in the United States. Before retiring as chief medical officer last December, I repeatedly saw patients with advanced conditions that could have been
prevented or cured had they come in earlier. I saw patients who came in with kidney failure who needed dialysis that could have been avoided if their hypertension had been treated. As people are looking at the increases in premiums they are facing on January 1st, they are weighing the decision to go without
insurance. There are patients trying to get screening tests done before the first of the year or get preventive services while they can. Every year more than 31,000 people die in the United States as a direct result of not having health insurance. That is because when people lose coverage
because they can't afford insurance without subsidies or because they lose Medicaid, they don't get necessary care and they are sicker when they get to the hospital. Common sense and basic compassion teach us that treating high blood pressure to prevent a stroke is better than dealing with the possibility
of permanent disability and rehabilitation. It saves money and lives to provide patients with chronic diseases such as diabetes and hypertension with routine care instead of waiting for their conditions to spiral out of control. Allowing private insurance companies to manage Medicare
through manage Medicare Advantage plans has led to fraud and abuse. The practices that claim to improve quality often actually deny care and cut costs for insurance companies which harms patients and blocks them from getting treatment needed treatments. For example, Medicare Advantage plans impose
numerous prior authorization requirements, averaging nearly two per enro, although only 10% of denials are appealed. 80% of them are overturned upon appeal. In contrast, traditional Medicare uses just one prior authorization for nearly every 100 enro.
When we deny care or take access to care away, people die. It is well documented that our health care system wastes 20 to 30% of our health care budget on bureaucracy and profit and adding proven ineffective layers like work reporting requirements to Medicaid just creates
more waste and red tape for the government and participants. I would also like to speak to the recent proposals to expand the use of medical savings accounts to address healthc care affordability. The idea of giving a limited cash benefit directly to patients so that they can make better
choices to meet their needs is a farce. They will use the money to purchase health insurance because there is no access to care in this country without insurance. The only savings will come when patients accept greater out-ofpocket expenses without the savings that come from spreading the
cost across large populations. Low-wage workers will make poor choices when having to decide between preventive services and immediate needs such as rent and groceries. We know that papsmears, mammograms, colonoscopies, and even blood pressure checks save
lives. We also know people living paycheck to paycheck have a hard time investing in the prevention of future problems. An underserved workforce unable to receive basic health services cost us in decreased productivity and lower profits. Somehow we've come to
believe that people who can't afford health care are disposable. Our society is worse off because of it. We can save lives and improve our society by giving people the care they need. We've make it too hard to access care and every year tens of thousands of patients die
because of it. We often say the United States has the best health care in the world. That's only if you're wealthy enough to access it. Thank you. >> Thank you, Dr. Feige. I'll start now. Mr. Strauss, Senator Sanders spoke about
people being un underinsured and the problems of having to have significant co-pays or or but clearly under the status quo, if you have a $6,000 deductible, that is almost the definition of being underinsured. Indeed, Dr. Figgan talking about people
under the current system delaying care, you can imagine because they cannot afford the deductible. Now, now I'm saying this quickly. What is the impact of a $6,000 deductible upon an Obamacare policy upon somebody's ability
to access care? >> Well, I would say it's one barrier. Um, the out-of- pocket maximums are huge. They're significant. So, deductibles and out-of- pockets. Prior to the ACA, if I had told somebody their out-of- pocket maximum was $5,000, I wouldn't have sold
a policy. Now people are begging for a $5,000 out. >> So what is the typical out-of- pocket maximum under the current status quo which folks want to continue? >> About $8,300. >> $8,300. >> Yeah. So >> So that's the that's the decision. That's what people are trying to continue under the current system.
>> Absolutely. >> Let me go. I'm sorry. Just real hurry. >> Yeah. >> Thank you. >> Yeah. >> Uh next. Uh if you had had a prefunded HSA with your own family history, preunded, the money is placed there. It doesn't come out of your paycheck. that's put there instead of going to an insurance
company who takes 20% for profit and overhead 100% goes to families and that would give you first dollar coverage. Would that have made an impact upon your ability to access that care? >> Yes. >> Yeah. Clearly. >> How? >> And I think too part of the problem is
that we can't force people to go to the doctor. We have preventive health benefits and people are not utilizing them. So even when they are zero dollar costs, which they are, that's one issue. But some people wish to go and that $6,000 deductible for maybe not
something covered at 0 is a barrier. >> Yeah, absolutely. >> Mr. White, premiums. I'd like to talk about the total cost of being insured. Folks are focusing on lowering premiums with subsidies, leaving that $6,000 deductible and an $8,300 maximum out of
pocket apparently incredibly callous to the impact that has upon somebody's budget. and we're talking about a pre-unded HSA in which the subsidy would flow to help somebody afford that care. Speak about the cost of being insured versus the cost of the premium, please.
>> Yeah, I think that, you know, people are focused on the premium. We're talking about almost $27,000 is the average for 2026, which is um about the cost of a a new Chevy Trailblazer, okay? Every year that you just have to get a new one every year. But really, the the outrage
here, I think, is the deductibles. And what we're seeing right now is uh 6 $10,000 $14,000 deductibles on family policies. That actually is restrictions on access to care. Um >> so the deductible that we would continue
with status quo if we do nothing is a restriction on primary care >> 100%. It it's not just that 83% of uh exchange enrolles are in an HMO or a most restrictive type of health plan where you can only see a network doctor.
uh you have to meet your deductible before the insurance will actually kick in, which means you've got to pay out of pocket when you go see that doctor uh until you hit your your deductible limit. Say it's $10,000. First United Bank says the typical
American has $1,000 in your in their bank account. >> So status quo does not work for that family with a thousand bucks. Keep that in mind. Status quo is not working. Let's not pretend otherwise. Now, Mr. Mr. point. According to the Congressional Budget Office, cost
sharing reduction payments as originally intended under Obamacare reduces premiums by 11% reduces the deficit by more than $30 billion. Can you explain how appropriating cost share reduction payments, which in fairness was part of original Obamacare, um
lowers premiums, and ultimately saves taxpayer dollars? >> Yeah, the the original law envisioned two subsidies. One was the premium subsidy. The other was a cost sharing reduction for people up to 250% of poverty. That uh funding for the cost sharing reductions were never was never
funded by Congress. Uh court order court ruled that um uh Congress either had to appropriate the money or those you know the the the funds weren't weren't available. And so Congress has never appropriated those funds. Uh what the the insurers have done is called silver
loading. they've increased their premiums and then take that to provide a uh higher actual value plan to the consumer. So 94% for example that lowers their out-of- pocket costs. So essentially they've raised their premiums, taken that money and then
provided more benefits and lower cost sharing. The challenge with that though is that everyone pays the higher premium. If you don't have a subsidy, if you're an unsubsidized individual, your premium costs are way up. So, if you actually appropriate the money for the
cost sharing reduction uh subsidies, that silver loading, those premium increases go away. Premiums go down for everyone, but taxpayer subsidies go down for those plans as well. And so, that's how you save $33 billion and you lower premiums by about 11%.
>> Gotcha. Thank you, Senator Sanders. >> Well, Mr. Chairman, you and I agree. >> We do. >> The status quo is not working. I look forward to your signing on to Medicare for all so that we can finally do what every other country on earth does guarantee healthcare to all people as a
human right. Let me very briefly and I don't have a lot of time ask the panelists very briefly yes no should the United States in fact join every other major country on earth guarantee healthcare to all people as a human right Mr. I I think the experience we've seen in
every other country is that it doesn't work well. Doesn't work well. Huh. Miss Fruss, >> I would say looking at the way the ACA has worked for us. Absolutely not. This is the first indication that it will not work in the >> Dr. Van you've studied other countries around the world. Mr. White says they
don't work all over the world. Countries want to join the United States, see a doubling of their health care costs, and deny millions of their people without healthcare. Is that what the trend is? You should ask the people with the condition in those countries how they had your time. Dr. Figgan.
>> Yeah. Every other country has managed to cover over 99% of their population and their life expectancy is longer than ours and they spend half as much as we do. We absolutely should do it. >> Dr. Figer, the nonpartisan Congressional Budget Office has estimated, and this is
really the important point. You want to talk about affordability. The CBO has estimated that Medicare for all would save the American people $650 billion a year. $650 billion. That's enormous amount of money. And provide
comprehensive health care to every man, woman, and child. That's not me. That's the CBO. When we talk about an expensive system, current system, we're talking about enormous amount of waste and bureaucracy
in administering hundreds of separate plans. She has a $10,000 deductible. I have a $5,000 deductible. You have no health insurance. Dr. Fagan, based on your experience,
what does that mean? the complexity of the plan and the cost of the plan and the impact on patients who walk into your office. >> Patients can't figure out how to access the care they're entitled to. And as a result, they often don't get the care they need. We could save billions, as
you indicated, hundreds of billions of dollars. And we know that over 50,000 people a year die as a result of not having health insurance. As you well know, everybody here knows the Trump's big beautiful bill is going
to throw approximately 15 million more or less people off of Medicaid. These are lowincome and workingclass people. And that decision was made in order to give a trillion dollars in tax breaks to the top 1%, Mr. Mus, Mr. Bezos, and
others. What happens when you throw 10, 15 million lowincome and workingclass people off of the health care, off of Medicaid, healthcare they have now? >> When we take away health insurance, people die. It's just that simple. People do not get preventive services.
They do not get the uh basic problems that we know how to treat. Their diabetes becomes uncontrolled. Their hypertension results increased strokes. We know that people have greater disabilities. We know that working-class people will make decisions that will mean skipping their health care until they are desperate and come into the
emergency department and at the time that they present with their illnesses will be forced to take care of them and it will cost us more. It cost us more to take care of the stroke. It take cost us more to put patients on diialysis. It cost us more when patients have diabetes and that's out of control and then we have to amputate limbs. We know that
eventually they'll come into uh the emergency department and COBRA requires that we take care of them regardless of the cost. And so we're costing ourselves more at the back end and we're losing contributing members of society >> which raises the question of why we spend approximately half as much per
capita on primary health care disease prevention as other countries. If I'm an insurance company, do I want to really invest in keeping people healthy? Is that where I make my money? The United States has about three primary care physicians per thousand uh patients in
this and every other country has over at least like 08 or 7 uh primary care physicians per thousand. So we don't produce enough primary care physicians to take care of the population at this point >> and we underpay those physicians as well. >> We do. >> You say as a primary care physician. Right. >> As a primary care physician.
>> Just so everybody you and I a couple of years ago were in Toronto as I recall. Right. >> That's correct. >> Okay. And the doctors there were telling us they do major surgery, good quality care. What's the bill when somebody comes out of a major procedure at a Canadian hospital? How much do they are they going medically bankrupt?
>> Absolutely nothing. >> Nothing. >> And we matter of fact, we visited the uh bill. >> And how much do they spend per capita compared to us? >> They spent half as much. >> There you go. All right. Maybe >> four years longer. >> Maybe we should study that. >> Senator Collins.
>> Thank you, Mr. Chairman. Mr. Chairman, I feel compelled to respond uh to the ranking members remarks about whether or not Republicans care about this issue.
It is obvious that we care deeply about the affordability of health care for our constituents. I would point out that the chairman of this committee is a Republican. He's the
one who has convened this important hearing. That is he is also the one who has worked night and day with many of us to talk about solutions. By contrast, the policy that we're
talking about during the Biden era was rammed through with no Republican support. And it was supposed to sunset so that we could have a more thoughtful approach
and it's now placed working Americans in a terrible bind. Mr. White in his written testimony refers to the affordability gap, the growing difference between the high
price of coverage and workers earnings. And that's why we should be putting partisan politics aside and trying to work together to come up with solutions.
The so-called free bronze plans have huge out-ofpocket deductibles, enormous unaffordable deductibles. That is an untenable situation.
which is why our chairman has talked about health savings accounts, has talked about cost sharing reductions. I want to bring up another issue and let me say I think there's a limit to what
we can do in this first year. I think we're going to need a two-year plan. Senator Marowski and others have proposed multi-year plans as well, but I
want to ask Mr. White about a shortterm solution that could be added this year and then a longer term solution that I'd like to hear the panel's views on.
First, there is no income cap on the tax credits on the enhanced premium tax credits. That means according to our calculations that a family of four living in Augusta,
Maine making $325,000 a year, which I can tell you would cover very few people in Augusta, Maine, qualify for a taxpayerf funed subsidy. Mr.
white. Do you think we should put a reasonable cap, phase it out so we don't have a cliff on who qualifies for these enhanced premium tax credits?
>> Absolutely. Yes. We need to understand that those subsidies above 400% of poverty are financed in part by taxes on working Americans. >> Exactly. Someone working at a bakery, a gas station, a lower inome family is
paying taxes to subsidize the subsidies for someone making 200, 300, $400,000 a year. That is not fair. So, there needs to be some kind of recognition that we can't tax low-income people to pay for high-income people's uh subsidies.
>> The second point I just make is there's no asset test on these enhanced subsidies. And so as an early retiree, I might have a sizable nest egg, maybe a million dollars, and have an income of $200,000, and still qualify for a
subsidy paid for by a lower workingclass American. That's not fair either. >> Thank you, Miss Strauss. Same question. >> Yeah, I agree that if we're going to keep the subsidies in place that we would need to have some sort of an income cap on there. And then also for
those people that potentially are underestimating their income to receive subsidies, they should be required to pay subsidies back at the time that they verify their taxes at the end of the year. So there should be some sort of, you know, safety net that makes sure that they're paying the appropriate
amount that they should be paying. >> Doctor, what about an income cap? >> I would have to get back to you on that. I have concerns about there are health expenses that people could have that could make their income uh problematic.
My time has expired. For the record, I'm going to submit some questions on the use of invisible high-risk pools and reinsurance which also can lower
premiums. and we did that in for a while and we did it in the state of Maine with some considerable success. Thank you, Mr. Chief. >> Thank you, Senator Collins. Senator Murray. >> Oh, thank you very much, Chair Cassidy. You know, we got to be real here. We are a month into open enrollment, a full
month. The time to save people from these huge increases in costs they're going to see because the ACA tax credits expired was before these premium hikes were all but locked in. saying, "Let's start talking about fixing this now, a month into open enrollment instead of at
any point earlier this year when we actually had time to stop premiums from skyrocketing or look at some of these different reforms." You know, th this is about as serious as expressing concern about RFK Jr.'s antivax crusade after voting to make him the most powerful
public health official in the country. The time is out. Realistically, the only way the only way now we can stop people from seeing these huge increases is a clean extension and a longer open enrollment. And I think we should be honest about that. I appreciate, Mr.
Chairman, the ideas being tossed around, even if I have some concerns with some of the proposals. But if Republicans had come to the table any point earlier this year, there would be time to sit down and talk about this. Um, but we have now seen the Republicans run out the clock.
They blew right past the start of the open enrollment. Forget about time spent negotiating. Even if we passed this uh bill today, there is not time to implement anything more complicated than a clean extension. So, if Republicans
are serious about preventing the mega healthcare hike, they should work with us right now to pass a clean one-year extension as fast as pos possible. Literally right now. And if their call for reforming tax credits is serious, we
should look at that. We can talk about those reforms ahead of the 2027 year. But I have to say I am not optimistic that most Republicans are serious about this because they refuse to um talk about this problem before right now. And
I've been down this road before. During the Trump administration, the first one I sat across from Chair Alexander, we hammered out a bipartisan plan to lower costs. We were on the one-year yard line. And then a call came down from
Trump and Republican leaders. They did not want us to get to a deal. They didn't want to help us lower healthcare costs. And they started demanding restrictions on abortion, something that had never been an issue before our in our talks until then. and use that
pretext to torpedo months of bipartisan negotiations. So, excuse my skepticism today when we've seen this tired playbook. If Republicans want to talk about healthcare, Mr. Chairman, great. Unfortunately, we've heard many
Republicans make it clear they're not serious. But if if that changes, Mr. Chairman, I'm at the table. I am at the table. I'm ready to talk about our health care system in this country. So, Dr. Dr. Figgan, let me talk to you. Um, did any of the cuts Republicans made in
their reconciliation bill this summer make health care more affordable for American families? >> They did not. >> Can you tell us why? The reality is that when we um take the
we make pay people pay more for their uh deductibles that they don't get care. The reality is when we say we're going to give them a medical savings account, the only choice patients have is to purchase health insurance. And so it puts them right back in when you're
purchasing health insurance on an individual basis. It's more expensive than if you're having part of a large pool. When you have to um you only way that you get a cheaper price is when you agree to have uh greater deductible or greater out-of-pocket expenses and you
have fewer choices. So they didn't save any money and giving the money to the patients doesn't help the patients make better decisions. >> Okay. And I and I've we heard a lot of discussion about coverage more affordable for small businesses and employers. I think what is important to acknowledge is that nearly half of the
adults with the AC within the ACA marketplace are small business owners or employees or self-employed and letting these tax cuts expire is going to hurt them dramatically. Um and Mr. Mr. Chairman, before my time is up, I do want to note that tomorrow CDC's vaccine
committee is meeting to discuss the childhood vaccine schedule, the he and the hepatitis B vaccines. Something the chair of this committee has said many times saves lives. The CDC advisory committee is going to hear from who knows who. But based on the fact that
the CDHC's own website now spreads antivax disinformation, I want to state for the record I am deeply alarmed this committee has not done more oversight. And we still have not done a thing to force RFK Jr. to come here and answer
questions about his decision to fire the CDC director Minaras and limit u access to life saving changes. Mr. Chairman, I hope that will change. >> Senator Mowski. >> Mr. Chairman, just quickly, I want to submit for the record uh unanimous
consent to enter a record into the statement from the American Cancer Society Cancer Action Network. >> Without objection, Senator McCowsky. >> Mr. Chairman, thank you for for this hearing and I want to accept the chairman's challenge this morning. You've kind of challenged us here. We've got a couple things that we need to be
thinking about. We've got the short term and it is really short. It is really short. Um, it didn't have to be this short. I uh it was I believe it was December 12th of last year that I raised a flag about this that we were going to
see this we were going to be dealing with this cliff and it wasn't going to be comfortable and for a host of different reasons. Um uh that conversation was deferred early in uh early in this year and things started to
heat up this summer and we are where we are. But I am in the same camp as as Senator Collins has outlined as as a Republican who cares deeply about this issue because my home state of Alaska appears to suffer some of the most
extremes of the extremes when we're talking about these high costs and people are expecting us to come up with a solution. They're looking at this cliff and saying what we are paying already. To your point, sir, the status
quo is not sustainable. But if we if we fail to act, if we fail to do something relatively soon here, the consequences are severe to people. when you're talking about close to onethird of your family's income going towards your
health care coverage. I I got a text from a friend over the Thanksgiving uh break here and uh she was telling me about the insurance that she and her husband currently have. Uh they are in
their late 50s. She says uh for uh this was this was um before the ACA for two years they paid $2600 a month, $30,000 a year for a terrible plan. High deductibles, no dental, no vision, terrible plan. We just watched our
dollars go out the door. Every one of us gets messages like this from friends and colleagues. Um they were able to receive support through the subsidies. their premiums went down to $500 a month and then even lower than that. And then just
recently they got their notice saying that for the exact same terrible plan they're going to be paying $3,000 a month, $36,000 per year. And she asked me the question. She says, "I asked you why you voted
against the repeal of the ACA back then, and you said it was because there wasn't a replacement. Have you or others been able to come up with a replacement?" So, we got two issues here. We've got a situation where she's now going to be looking at $36,000
a year that she and her husband are going to be paying. But she also fairly wants to know what's the plan here for reducing overall cost of care. And Mr. Chairman, I think you've you've you've pegged it here. We need to address the
short-term reality that we are facing and we need to be looking long-term. And again, this is the role of this committee to be doing exactly exactly that. And so I I want to focus on not the message, not to be able to say I
told you so, it was coming, but I want to be able I want to be able to say we have helped address this. I think we're going to need to have a short-term extension. But I think we can put reasonable caps on. I think that we can put some of the parameters that we have
been talking about. There's no great secret sauce here to how we're going to deal with this particular dilemma that we're in, but we've got to be looking longer term to how do we ultimately reduce these costs of care. I have one
minute left in my comments and I want to ask a question about kind of the longer term because we're gonna work out or not work out whether people like my friend are going to be going to be going off of this cliff and making a decision that
they're not going to be uh covering themselves potentially. But we we focus a lot or we talk a lot about the prevention side and we know that if we can if we can re keep you from getting sick in the first place, we
save some money. I've been watching what we have what we've been doing recently and I'm concerned that we're seeing some some major cuts to public health and and prevention funding. I worry about that because I think that that actually helps
us in the long run. If you had to pick one or two prevention type programs that have the strongest evidence for reducing long-term costs, what would you tell us to prioritize? And you got two seconds,
>> Mr. White. Quickly, quickly, what would it be? >> I I would allow uh premium discounts in the individual market for wellness programs. Those are currently illegal. we can incentivize people to take better care of themselves through financial incentives. >> Yeah, Miss J,
>> I would open up HSA accounts to allow for more holistic and preventive services to flow through those accounts. Um, and then also really highlighting direct primary care and the ability that we have to go um lower prices through direct primary care and making sure people are actually getting the care
that they need. I think primary care as well as screening. We chart, you know, papsmears, colonoscopies, the things that we know save lives. >> Thank you, Mr. Chairman. >> Thank you, Senator McCowsky. Senator Baldwin. >> Thank you, Mr. Chairman. Um I
as much as we disagree on things, I just want to note the underlying agreement that this system needs a lot of reform. And uh Mr. Chairman, you opened up with saying uh we have three weeks. We have
12 days. That's how long we have until open enrollment closes. And um obviously we could take some future action to extend open enrollment. Um but but it this is something there's an immediate issue and then of course
there's a lot of agreement on the structural and systemic problems in our health care system. I I I want to make a point that um just under 50% of Americans get their health insurance through employers or group insurance,
20% are on Medicaid, 15% on Medicare, 1% on Triricare or VA, and just over 6% are in this market. There are problems with this market, but
I have to say that abandoning the ACA by getting rid of these uh you know and trying to overturn it or destruct it is not going to solve the system as a whole. And many of our uh of our uh experts here, you know,
talked about some of the problems of consolidation of uh the pervasive role of middlemen in the health care system. Uh addressing private equity in health care and part of the pursuit of solutions there will involve much
greater visibility on what's happening behind the curtain. transparency efforts, and I know there's bipartisan agreements on a number of them, will inform this committee in major ways of what we need to do to extract reforms and make sure that this
isn't just a profit motivated system, but is in fact focused on patients and the well-being of Americans. But the solution is not to let these enhanced tax credits expire. We've got
to buy oursel time to do these larger reforms. What allowing the Affordable Care Act tax credits to expire will do is move people who are currently the 6% of Americans who
currently buy their insurance in the individual market. They'll become uninsured or go for junk plans. We can talk about that later. But the Affordable Care Act with all its flaws requires that health insurance
plans cover a wide range of preventative services at no cost to the patient. So no matter how big your deductible is, your preventative care is covered under the ACA. A lot of the Wisconsinites that I've been talking to who are lamenting
the fact that their premiums are doubling, tripling, quadrupling are saying, "I get it for the preventative care that I can provide my entire family before dipping into the deductible and then it is a medical bankruptcy
prevention insurance, right? Maybe >> it means that if you have a $10,000 deductible, but you have a crisis, an injury, an accident, an illness that costs more than that, you won't
lose everything. We can definitely improve the ACA. We can improve the entire system, but the solution is not to let four million people not be able to afford it anymore.
And so we must figure out a way to extend uh the Affordable Care Act tax credits to allow our committee, the minds in this room to work on
whole structural and systemic reforms. Dr. Dr. Figan, why is it so important that we extend the enhanced premium tax credits as soon as possible given there's 12 days left of >> right because people are making those decisions now about whether or not they should keep their health insurance
because they realize, you know, we have to recognize that this is a huge financial burden on the household and and people are making decisions that maybe I should go without health insurance. Um, it's a huge problem for for working-class people because it allowed people who otherwise wouldn't
have insurance to have insurance. And to the idea that they're going to go without um you can't predict um when you're going to have, you know, you feel tired and abnormal blood test shows you have leukemia. You can't predict when you're going to be in an automobile accident. And to subject working people
to that stress in addition to everything else that's going on in the country today is frightening. Thank you, Senator Bald Baldwin. Senator Huststead. >> Thank you, Mr. Chairman. I very much appreciate the work that you have put in
here over the last few months to try to advance the conversation uh across in a bipartisan way. I know that January 1, whether we say it's 12 days, 30 days, we have a time crunch because there are,
you know, it's interesting to me because the if you if you don't work, you get free health insurance in this country, but if you do work, you're getting screwed right now. It's just not fair for people who are trying to do it the right way, who are
working. And um I have a fresh approach to this because I was not here when the ACA was created. I was not here when the tax credit COVID subsidies were implemented and scheduled for expiration. But I do
see a lot of Americans and I've talked to many of them who don't care whether the Democrats created the problem or the Republicans created the problem. They just want their government to fix it. They just want
their government to help them. And we have a few days to prove that we care, that we're going to try. And the, you know, it is it is frustrating. And I
know we could do this because we uh Senator Hassan and I had the smart OTC act which was a bipartisan effort to help make it easier to take prescription drugs and make them over-the-counter drugs and we got that done here in the last few weeks. That's just one small
step. There are dozen small steps or or even moderately successful steps that we can take to reduce the overall cost of health care in this country. It's the number one driver of inflation in the 21st century.
it is a burden on small businesses and rateayers. Um, and I and I've proposed in recently just a simple a simple start to this. I called it fraud, freeze, and fix because we know in the system as it is right
now, the zero premium plans are susceptible to fraud because insurance brokers who've been prosecuted for this sign up people who don't even know they're being signed up siphon off hundreds of millions, billions of dollars of money that go to the
insurance companies and never actually cover a person. So, we can fix that. That should be something everybody even if it's just a dollar to say, "Hey, I'm a real person and this is a real policy and and uh
we're going to eliminate the fraud and we can freeze the the subsidies where they're at right now for a temporary period of time. I don't know if that's one year, two years, uh to help give some relief. And by the way, just because we continue those
uh tax credits does not drive down the cost. It transfers the burden to the taxpayer and future generations. But it is a little help right now that we both can agree on. And then we got to fix it. And there
there are at least five to 10 really solid pieces of legislation that I know have some bipartisan support that we could tackle to prove that we're serious about driving down the overall costs.
And that's what I hope we'll do. That's what I hope we'll do because there are a lot of people out there. I talked to a gentleman recently. He makes $83,000 a year. He doesn't he doesn't want government insurance. He said, "I don't want the go." But he said, he
said, "But the government created this problem. I have one plan to choose from. One plan. It's all I can get in my little rural community and it's going to cost like almost a third of his salary to pay for it all. Plus has a huge deductible."
That that's what the government did to people, the ACA, and other things. And again, I I am we can start fresh. We just got to get better. like it's it's going to be a piece at a time. It's going to be a moment in time. Uh and um we have a lot
of ideas. I know I'm going to run out of my time here uh to be able to do this, but I would I'm going to introduce soon a healthy competition for better care act that enables uh more group health plans and health insurance insurers to ensure agreements that providers to guide enrolles who for uh high value
providers. And like literally, we have contracts that people enter into that say, "No, you can't tell people about a better deal." I mean, seriously, that's what we allow in this country. We don't allow real consumers and
shopping and healthcare. And so, uh, I guess I I'm out of time, but how's that sound to you, Mr. White? >> Go get them. >> Sounds good. >> Thank you, Mr. Chairman. Huststead is at the foot of Marcowski in terms of
milking the clock. Uh so now uh Senator Kaine. >> Thank you, Mr. Chair, and to the chair and ranking. This is an important hearing, great witnesses, a lot of agreement about things we need to do, a sense of urgency about some things we should do very quickly and then a
commitment to look longer term at at bigger solutions. Um just to tell you the the life of a senator, we get a lot of letters. Let me tell you about healthc care letters this year. um a year last year in the period from the beginning of the year to the beginning
of December 2024 I got 55,000 pieces of correspondence about healthcare last year this year in the same period 140,000 pieces of correspondence about healthcare almost triple few examples a
family in Crosse Virginia near Charlottesville their marketplace plan premium will triple in price without the extension of the ACA subsidies Glenn Allen, Virginia, a couple that's a suburb of Richmond, their premiums will more than double from 940 a month to
2200 a month without the extension of the ACA enhanced subsidies. And a gentleman from Lake Frederick, Virginia in the northwestern part of the state on fixed income, he'll be paying 2,600 a month if the enhanced subsidies expire.
And this is just a small snapshot of the 150,000 pieces of correspondence. We we missed an opportunity and I just want to put this on the table. The reconciliation bill that was passed at the end of June
gave tax cuts to people in the top 1% of American wealth totaling a trillion dollars over 10 years. We gave tax cuts to the top 1% totaling a trillion dollars over 10 years. What would it have cost for us to extend the premium
tax subsidies? 350 billion. Not cheap, but onethird onethird of the tax cut that we gave to the top 1% of people in this country who sure didn't need a tax cut. We we could have given them $650 billion of a tax
cut and extended the ACA subsidy and that was not the choice. And that's one of the reasons why I voted against the reconciliation bill. We're talking about doing a short-term extension possibly of the tax credits about $35 billion a
year. So for two years, $70 billion up against a trillion dollars of tax cuts to the wealthiest. We can do this. We should be able to do it. We we should extend the enhanced tax credits for a period of time and then work on the ideas that are around the table. And now
now let me just focus on ideas. We want solutions that promote competition that support small businesses, workingclass families, that are affordable, that don't pad the pockets of middlemen. I'm so frustrated with middlemen.
I'm so frustrated with middlemen. I have two ideas that I want to put on the table for the longer term. Well, actually, one is for the longer term discussion, one could be short term. Um, Senator Bennett and I are going to soon reintroduce our Medicare Act Choice Act, which would direct CMS to offer
a nonprofit insurance plan covering the Obamacare essential health benefits. Medicare operates on an administrative cost of about 1 to 2%. It It exists in every zip code in the United States. It would It doesn't have to pay fancy salaries. It doesn't have
to market on TV. it doesn't have to do a return to shareholders or pad, you know, people's pockets. Um, a a a policy directed by CMS with premiums that would cover the cost of it, but the ability to
use premium tax credits to bring the premium down even further would be such an attractive option. We don't want to have just one option available to everybody. So, make a public option available. What's wrong? It would promote choice. It would promote competition. would bring down cost.
I I recognize this proposal would be one part of a long-term solution. It's different than the one that Senator Sanders is talking about. It shares some elements, but it's different. But these are the kinds of big ideas that we ought to be talking about as we're trying to find a long-term solution. And and the second one, I think, is even short-term.
We've already done it. PBM reform. This committee passed a fantastic bipartisan PBM reform bill a year ago. Again, on the middleman theme, I don't like the consolidation of the insurance industry and that huge profit margin that jacks up everybody's costs. And I don't like
pharmacy benefit managers who don't do any medical research, who don't produce any products. I don't like them charging based on a p percentage of the drugs that they're sending out, which gives them an incentive to not focus on lowcost
affordable drugs, but skew the market toward higher cost drugs. so that they'll make more money for basically doing nothing. And we passed this bill out of committee with like a 19-2 vote a year and a half ago. And it was almost taken up at the end of last year on the floor, but we sort of ran out of time. We should do that bill right now. That's
kind of like in the USD theory of let's hit some singles or some doubles on things where we agree. Would PBM reform be a good idea to the panel? >> It's essential. >> Essential. >> Absolutely.
I agree. However, a one-sizefits-all does not solve the problem because there are great PBMs that do things the right way. We have a few that are the greedy middlemen. So, yes, I do think PBM reform. >> I'm I'm I'm glad that there's not only agreement here, but on the other side of
the DES. Thanks. >> Thank you, Chairman. I just see a great opportunity this morning. I really do. The stars are aligned. We share so many of the same motivations. We all recognize the challenges that the cost of health care is a major challenge for Americans.
I think we most of us recognize that the ACA empowered insurance companies. Uh we're sending $150 billion dollars a year to insurance companies and one of our solutions is to take part of that money and add it to an HSA where
patients get to make their own choices. If we give patients uh choices, uh we turn them into consumers again. And they're great shoppers. Americans are great shoppers if you give them the opportunity to look at price tags. Senator Sanders mentioned that a
Medicare for all, according to CBO, would save $650 billion a year. Uh I think putting in proportion, we're spending, remember, we're spending $5 trillion a year right now on on health care. Our price tags bill would save
Americans a trillion dollars a year. That's according to 40 economists. And these economists are from the West Coast, the East Coast, the Midwest. I saw even some people from the Southeast conference have economists too. I didn't
know that. But um so we think that the transparency part of this, the price tags part of this is just so important to to go along with giving expanded HSAs. Uh Mr. Chairman, I'd like to ask unanimous consent to enter four
documents into the record. The first is the letter of support from 40 economists pointing out ways price transparency will lower the cost of healthcare. The second, a letter of support from the National Associations of Benefits Insurance Professionals. The third is a letter of support from 54 employer
groups and unions highlighting the importance of passing patients deserve price tags which Senator Hickin Looper is my co-sponsor on that bill. Uh we have eight senators sponsoring it for uh it is bipartisan four I believe are on
this committee. The fourth is a report from the patients rights advocate showing how price transparency can reduce healthcare costs by more than a trillion dollars annually. >> Without objection. >> Thank you Mr. Chairman. Again, it's time for this isn't a single or double. I think that this is a home run bill and I
would just like to ask your feelings on giving us some type of a mark upon it hopefully sometime this year. >> Absolutely. And by the way, Senator Baldwin also echoed that sentiment. So again, there is bipartisan consensus on the need for transparency. >> Yeah. >> I think that whatever we agree upon,
let's get it done. And I think that probably 80% of some of the solutions we agree upon. So let's let's move. the American people need it and and they deserve that as well. Um, I'll ask Mr. White, what what do you feel like the impacts of price tags for
consumers would do? It would be a gamecher. I think that right now we have an opaque system where people don't even know what they're buying until after they bought it, after they get the bill from the company, uh, after they get the care from the doctor. And so having that upfront price disclosure absolutely
foundational, critical to getting better market results, uh lower costs in specific markets, like in within one zip code, the price of an MRI can vary by up to seven times. Seven times. So uh $500
at one imaging facility, $2,500 at another imaging facility, and the consumer may not even know that they're getting a bad deal. Um, disclosing that upfront can absolutely encourage shopping, can lower costs, >> especially if you know that the outcomes are better at the less expensive place.
I think hip surgery is another great example. You might have a hip replacement in a surgical center for that reimburse 10,000. In some other hospital, it's $50,000 as well. Mouse, let's uh talk about consumers again. I'm sure you know that that women make 80%
of the healthcare decisions for families. So when when I was running a hospital, we would market towards towards women as well. Um I by giving shoppers price tags and putting expanding their HSAs, whether it's for
direct primary care or for these preventive medicines, how do you think it impact the real spend, not just the government subsidies, but the real spend of healthcare? >> Yeah, I think it would have a tremendous impact. And I think what other place in our world do we buy something without
not having any idea what the actual cost is? And so we do need to make sure that transparency is a big part of that. Um but I do think having accounts where people can be in their own driver's seat of their own health care is essential. It also makes them more accountable for
the choices that they're making. So when they're spending the money and they know exactly where it's going, they're going to be a little bit more thoughtful about that. And again on the preventive, we can give free preventive all day long, but if somebody doesn't take advantage of it, they're not getting the service. So direct primary care is a huge benefit.
>> And I got a lot a lot more things I'd like to talk about, but I think there's great opportunities with expanding health care plans across state lines through association health care plans. If Amazon or Costco was able to offer their members some type of an association health care plan, it it
would help those small businesses as well. And and wanted to just briefly circle back to the importance of community health centers. Um, it's the closest thing to Medicare for all that I can think of is is expanding these community health centers, which is going to take funding as well and and making
America truly healthy. Again, a more holistic approach. Thank you, Mr. Chairman. >> Senator Hassen. >> Well, thank you, Mr. Chairman, and to the ranking member for this hearing. Thank you to our witnesses for your care and your expertise. I I want to start by just echoing what I think we've heard on
both sides of this dis today, which is there is a lot of agreement on things like price transparency, something I've worked on with uh Senator Cassidy uh on PBM reform. Um there's a lot of good ideas about ways to lower the overall
cost of care, but we also know that one of the ways you lower the overall cost of care is to make sure that people uh get the preventive care they need and get their care at the right end of the system. And as important as these bipartisan ideas are right now, I do
want to emphasize and agree with my colleagues who have pointed out we've got like three weeks to solve this. Open enrollment for people who need coverage starting January 1 ends on December 15th. If you're waiting for February 1 coverage, it ends on January 15th. We are running out of time and um in my own
view, this means we do have to do a short-term extension straight up. There are a couple of reforms um on the enhanced subsidies that I think there's some bipartisan agreement we might be able to get to, but we need to do that right now and then think about uh what's
next in terms of overall cost reduction. But I do also want to make a couple of other points. The PBM reform that we're talking about, that was in a bill that was ready to be passed on the floor of the United States Senate last year until Elon Musk vetoed it. one tweet
essentially vetoed what was a bipartisan bill. And so I just think we all got to return to some of the work that we have done and get to it uh understanding that it's come through the committee understanding uh that it's uh reflects a lot of bipartisan work. Um, the other
thing before I get to questions is I I do want to acknowledge one how difficult and broken the system is right now, but also um what it was like before the ACA because I think there's been some amnesia up here. Um, before the
Affordable Care Act passed, my constituents who had pre-existing conditions had no option for insurance. Senator Houston said there's only one insurance uh plan for some of his rural constituents. That's becoming a real problem in New Hampshire, too. But before the ACA, people with pre-existing
conditions couldn't get health insurance full stop. Before the Affordable Care Act put Medicaid expansion into place, which my state adopted on a bipartisan basis, people with who needed addiction treatment couldn't get care. people who
didn't work enough hours to be counted as a full-time employee uh in their employer maybe because they had caregiving responsibilities that they weren't paid for couldn't get coverage but Medicaid expansion allowed
them people who were working to get coverage and the Affordable Care Act to the point that I just want to emphasize it covers preventive care at no cost. So, I want people to understand that even if you have a high deductible, and
we do need to bring those deductibles down, you can get preventive life-saving preventive care because of the Affordable Care Act. That was also not true for a lot of covered uh folks before the
Affordable Care Act passed. Now, um my office recently heard from one of my constituents named Karen who lives in Bo, New Hampshire. she will have to pay $200 more each month in order to keep her health insurance next year if we
don't extend these tax uh these tax cuts. However, Karen's family can't afford to pay those higher premiums. She can't afford the extra $200 a month because of the rising cost of groceries, energy, and housing. Um she can't afford
it unless we do something. So, Dr. Fegan, what action can Congress take to ensure that people like Karen and her husband can afford their health insurance on January 1? And have you heard any proposal discussed here today that could lower my constituents premium
payments in 2026, which is just four weeks? I I I think the logical thing is to extend the uh subsidies that currently exist. I can tell you that I've had patients um I had a I had a nurse's aid who went without insurance and came in
with a sore throat she'd had for several weeks and turned out to have um inoperable throat cancer >> because she made that decision. >> Yeah, I I appreciate that and that's one of the things we're trying to prevent. Uh one last question for you Dr. Figgan. As I mentioned before the Affordable
Care Act, insurance companies could set they could deny pre-existing condition coverage for people with pre-existing condition. They could also set an arbitrary lifetime limit for patients, meaning that they could deny a claim once that that limit was reached. Now, some of the testimony submitted by the
other two witnesses here today suggests that we should reinstate lifetime limits in health plans, meaning that insurance companies could stop paying for care for a patient with a chronic or pre-existing condition. So, Dr. Figgan, you can you talk about the dangers of lifetime limits on care that we saw prior to the
ACA? I can think of nothing worse than telling a patient who survives a horrible diagnosis of cancer and we cure and then tell them they are no longer eligible to get insurance should they have any other problems. Before the ACA, 80% of our outpatients and 56% of our inpatients were unfunded at Cook County.
So, it's made a world of difference for us. >> Thank you very much. Thank you, Mr. Chair. >> Senator Holly. >> Thank you very much, Mr. Chairman. Thanks for calling this hearing. Thanks to all of the witnesses for being here. I I just want to start with numbers that I think are absolutely unbelievable.
The cost of health insurance, the increase in health insurance expenditures or health expenditures since 1960 is up. I think we've got a chart maybe over my shoulder here. Since 1960, there has been a 2,19% increase in the cost of health in the
United States. Healthcare spending. 2,19% increase. Today, Americans spend more on health care than on groceries or housing. I mean, this is extraordinary. More than on groceries or housing. 41% of adults in the United States have debt
from medical expenses. And I noticed a recent Gallup report found that 31 million Americans borrowed money last year to pay for healthcare. 31 million Americans. I want to just add to some of the testimony that's been offered here
today by reading you something from a constituent in my state. This is a mother in my state of Missouri. She said, she wrote to me recently and said, "The health insurance coverage for myself and my two daughters are showing to be $1,500 a month, enough to actually make a
mortgage payment. I'm a small business owner and wondering how I'm going to be able to afford this." She goes on to say in that same letter, "I thought about just getting insurance for my daughters, but I also remembered the time where I couldn't afford insurance one year and the doctor and hospital bills were twice
as much for cashpayers because they bill you the maximum amount possible." I mean, I think we should just be honest about what we're facing here. This is a crisis. This is a crisis. And I realize that in Washington, it's it's treated sometimes as a numbers game. It's treated as a as a white paper to be
discussed. But for people at home, they cannot afford to go and see a doctor. I'm the father of three small children. I can't imagine what it would be like to say, you know, I just I can't I I can't afford it. I can't take my kid to the hospital. I mean, you know, we're fairly frequent visitors to the hospital in my
family. I've got two boys. Uh we're there on fair amount for their various injuries. And thinking about parents in my state or anywhere else saying, you know what, I think my kids's got a broken bone, but I I can't I can't go to the hospital. I can't afford it. I can't go to the doctor. I can't afford it. And
millions of Americans are saying that on the subsidies, on the premium tax subsidies. Let's just be honest. If we don't do something on this issue, if Congress does not take action on this issue in the next few weeks, this will be a crisis for 24 million Americans in
counting. In my state, premiums are already going up by between 24 and uh 50% depending on the healthcare plan, depending on the region of the state. I mean, so we are looking at a massive crisis unless Congress acts and acts
soon. And my message is to the leadership of this body, to the leaders of the House, the leaders of the Senate, maybe it's time you all locked yourselves in a room and got to a solution here because it's not going to be a solution in a couple of weeks to say, "Well, we just couldn't get it done. We couldn't think of anything. You
know, better luck next year." If that's the attitude that ends up being taken in this body, millions of Americans are going to go without healthcare coverage. And let's be honest, millions of Americans can't afford it now before we hit the cliff. So, I I think it's time to get serious
here about the crisis that we are facing. We have got to take action on the subsidies. I'm, as I've said for months now, listen, I'm open to proposals. I'm open to any proposal that will keep the costs down, but we've got to take action. Doing nothing is not a solution. But I I have another
suggestion to make, and it's a bill that I'd like a proposal I' I'd like to introduce. I am introducing today. In addition to taking action on subsidies, why shouldn't we make health care taxfree in this country? Why shouldn't we just exempt all health care from
taxes? We did no taxes on tips, no taxes on overtime earlier this year. How about no taxes on healthare? If you pay premiums, you ought to be able to deduct that from your taxes. If you have outofpocket medical expenses, you ought to be able to deduct every dollar off of
your taxes. You want to lower the cost of health care immediately, do that. No taxes on healthare for any American. And you set an upper limit so you don't have people, rich people gaming the system. I get it. That's fine. But let's think about working people in this country who cannot afford health care. What if we
said to them today, "We're not going to tax your health care costs." Does anybody on the panel have a reaction to that? Let me start with you, Dr. Fagan. We'll just go down the panel. What do you think? No. No taxes on healthare. you know, it's I've never it could work.
Um, you know, people are paying a lot for their healthcare. I think working people look for any advantage that they could get. Um, but I'd have to look at it >> sure >> more detail. >> Mr. Simple answer is yes. Anytime you can get a savings on a tax deduction, absolutely. And especially something
around healthcare. >> Mr. White, any reaction? >> Taxes increase costs. Uh, so eliminating them should lower costs. The people here especially affected are the self-employed and they have to itemize up to 7.5% of their income right in
order to get the same tax benefit that a big company can get. So what you're talking about is equalizing leveling the playing field for everyone. Yeah. That makes sense. >> That's exactly right. Instead of 7.5% and you have to itemize, let's let's move it above the line. Let's say that you can you can take that deduction no
matter if you're itemizing or not. Very few people itemize. and let's allow them to take the deduction on the first dollar. I mean, that would that would lower health care costs for millions and millions of Americans. I think it's something that we should seriously consider. Uh we're almost I am out of
time. I guess >> you are >> you are out of time. >> I am out of time. >> Senator Hookenber. >> Thank you, Madam Chair. Um and thank all of you for uh coming over and and for your service uh in this uh in this
efforts. Um Mr. I'll talk with you. I'll start with you. Um, some of the ideas you've discussed would take us back to what I think of sometimes as before times before the Affordable Care Act was passed. Things like the, you know, lifetime limits on enrolles or removing
a requirement to cover the what are called the 10 essential health benefits, basic things like maternity care, prescription drug coverage, mental health uh, treatments. Um, these are things that affect the vast majority of Americans and uh I'm concerned that some
of the changes could take our na our nation's the medical debt problem that you've referred to um and make it much worse. Um right now we have more than 20 million Americans reporting having some amount of medical debt that uh hangs over their head. Colorado that's over
360,000 people. So, um, have you actually modeled, um, how reimposing lifetime limits and other similar changes would impact the current medical debt crisis? >> Yeah, so we do have, um, information out on just how quickly, as you saw the
chart that Senator Holly just put up here, you could see from the time the ACA hit, our our costs increased much significantly faster than prior to the ACA. So when you look at things like that, what we did was we just pulled off the cap on on what people can charge.
We're seeing $32,000 monthly costs for drugs today for cancer drugs. You're seeing people charging for imaging at a huge amount where before there was some sort of control. I'll give you an example. I have my twins that were born with their neuromuscular disease spent
the first three and a half months in the hospital in 2004. They each got a hospital bill for $400,000 for one month. We didn't even come close to our lifetime maximum. So, the numbers that you're looking at didn't always feed
into what that lifetime maximum was. I I never ran across somebody who did not have coverage. And I did see very high cost claimants come through that system. So, also with the Affordable Care Act, I'll just give you an example of my own personal. My family's on a grandmotherthered plan. So, a preaca
plan. We have a $2,500 individual deductible, a 700 $7,500 out-of- pocket maximum. For my family of five in 2026, our premiums are $1,221 a month. If I look at a marketplace plan today, that same equivalent plan that
now takes my out-of- pocket maximum up to 8,200 is double at $2,440. We have a crisis due to the Affordable Care Act regulations. And the and the what it did is exactly the opposite of what you wanted. It lined the pockets of
all the middlemen and gave them their own ability to charge and to collect income on much higher numbers with no negotiating happening at all. >> Well, certainly that would argue for more price transparency, which was my next question. I wanted to start with um
Dr. Figgan. Um that so many of the ideas floated here today are obviously worthy of our attention and discussion. Um but we're not going to have time in just the next few days to um effectuate certain changes especially as that so many people are seeing their premiums
skyrocket. Um, one proposal that is that we pushed forward for future discussion is our our patients deserve price tags act with Senator Marshall, which uh really does look at how do you create transparency and give people especially
people that manage the the health plans for large number of employees the the data to really hold the market create some market uh competition. Um, so Dr. Dr. You've seen firsthand the impact that high costs on patients and impact their decisions regarding accessing care
uh accessing care and and prescription drug treatment. Do you believe it's do you believe it's more important for any leg future legislative work on health reform to also include some efforts to get price transparency uh into the into the operating norm. I think that price
transparency is important but I think that people need to understand that health care does not uh does not meet you know behave as normal market forces and that people don't have the capacity to shop as we imply you know for some
elective procedure you know you can look and see if an MRI is cheaper here or cheaper there but the majority of time people are making serious health decisions it's it's a time of a a health crisis >> I'm not I'm not suggesting people go out and shop every time they go see a doctor. >> I think we should have
>> No, no, hold on. I I think that that what I'm suggesting, especially with the large employers that can actually are managing the healthcare for thousands of people, when they can see what one hospital is charging versus another for the same thing, they begin to use
pressure to make those those that data available and use it in making decisions on which insurer they're going to use. I think that's how you begin to drive. >> I think that's essential. I think you know in Chicago where we have seven medical schools and all no one knows what each one is charging and you know
it results in people charging what the market will bear well we don't know what Northwestern charges why don't we try this and see if that's what they're going to be able to get so I think that makes a difference >> great I appreciate that again thank all three of you for being here I think >> taking the over here this
>> you know they made a huge mistake they put the most junior member in charge of the gavvel such a mistake uh thank you very much uh and appreciate all of you being here today and taking the time to talk about one of the most important issues I think facing Americans right now and that is the skyrocketing
premiums that we are seeing for all Americans. Certainly, we're talking about a a limited scope in terms of uh the the the Democratic pushed structure of subsidies that have been um enacted over the last few years. But
we're really talking about skyrocketing premiums for all Americans because I firmly believe that the misguided, ill-informed, reckless decisions on some of these things and the allowed uh fraud among it, the just taxpayer money that we're just lighting on fire in many
instances and giving to bad actors and not going to healthare has caused this rapid increase in all health care premiums for all Americans. And so I appreciate your time being here today because I think the best way to govern is to roll up our sleeves, talk about
the facts, figure out how we got here and how can we fix things. Uh I come from the state of Florida. I'm really proud of that. The way we we govern and lead there so many of what we've done is because we're willing to put in the hard work and our answer isn't gutturally all the time just throw more money at a
situation and cross our fingers and make a prayer and hope a problem goes away. it's how do we unravel uh where things might have gone wrong or put in safeguards to make sure we can save money and operate more efficiently. Um and so I was really excited to be be here as the newest United States senator
to bring some of that approach and perspective to DC. And this is one of the main things that I I don't think people can wrap their heads around like how did we get here? In fact, in Florida, I want to just point out we are now ground zero for fraud in in some of
this money that was that has been pushed out there. And again, I we I think we should always go back and say taxpayer money. Um that I think is is in in many instances the because we have a system now built with virtually no safeguards where fraud prevention is an
afterthought, we are wasting taxpayer money when it could be going directly to health care. Uh, and so in Florida, I I told you we're ground zero for this fraud. Uh, we had a we had a great now a congressman, a former CFO who opened 900
investigations into subsidy fraud. Uh, he said there was less verification for getting some of those COVID subsidies than there was for signing up for Uber. Um, and the examples are staggering. You know, we had a federal grand jury in
West Palm Beach convicted uh two people for 233 million in Obamacare fraud, a scheme that signed up homeless and drug addicts for these subsidies. And then those people got huge kickbacks. Um there was a conviction in April where a man was defrauded defrauded the
government. And when I say the government, the taxpayers for over 130 million by fabricating documents for ineligible people to get them signed up for Z plans. Um, and it's this example of, you know, I hear time and time again
that, well, let's just keep doing everything the way we've been doing it. That is not responsible. We're not living up to what we've committed to the people who sent us here to do. Yes, let's address skyrocketing
premiums. less us talk about what is the best place, how do we get to making sure that we have uh health care uh and people can afford health care in this country. But what we're doing isn't working. In fact, the opposite. What we're doing right now is causing these skyrocketing premiums causing it. And so
when I hear let's just keep doing everything the same, I'm thinking to myself, is it just me? I is it just because I'm new here? That's insane. That is not what we signed up to do as leaders coming to Washington and saying we're here to help the American people.
Let's dig in, roll up our sleeves. Let's do it the Florida way and get to the reason why these skyrocketing costs are going up and not this guttural reaction of let's just keep throwing money to bad actors that are taking advantage of this government and taxpayers and even people that are seeking health care,
legitimately vulnerable people, they're being taken advantage of. So, I'd like to ask you u Mr. way. What why is it that we're seeing so much fraud uh in these subsidies? Um do Z premiums
incentivize fraud? And who benefits the most from such fraud? >> Yeah, I I think there's four things that happened. So in Obamacare, we made the plans 50% more expensive on day one. And then we said the only place you can use
your subsidy is on those expensive plans. And then we said we're going to send the subsidy to the insurance company, not the person. So the person was disintermediated. And then under the enhanced subsidies, we said there'll be 0 premiums. Once you set the premium to
$0, that's when fraud took off. CMS says that 35% of people on the exchanges had zero claims on their plans once those subsidies were in place. So, it just encouraged the fraudsters because someone's getting signed up for a plan. They don't even know they're being
signed up for a plan. That's 6 million people on the exchanges this year. That's fraud. So, there are tools that we can use to prevent that fraud. But the biggest thing that kicked off that fraud event was $0 premium. So, just charge the state's minimum wage uh per
month. do something reasonable to get a financial incentive in place to say, "Oh, yes. I'm actually enrolled in this plan. I get a notice on my phone just like I do with any credit card when when something happens financially to me." Uh, to say, "Yeah, I'm actually enrolled in this plan. I actually can use this
benefit or I never signed up for this. What the heck's going on here?" So, we can stop that fraud. Six million people with these subsidies on the table is billions of dollars in fraud lost every year. >> Thank you, chairman. Thank you for holding this hearing.
>> Thank you, chairman. Thank you to the three of you for coming out here uh and talking to us about this important issue. And I I when I was preparing for this, I was trying to talk through to some of my constituents back in New Jersey and and
hear the challenges that they're facing right here and now. And I remember I was talking to Cindy from Tom's River who I had recently met with and she was saying that she said, quote, "I received a new premium estimate for 2026. I wanted to share them with your team. Last year we
paid approximately 27,000 for our plan for our family. This year the same plan will cost us approximately $50,000, an increase of about 85%." And I think about this, you know, Cindy's 85% increase is half of the
average increase that we're expected to see in New Jersey of about 174%. I've heard a lot of these stories, unfortunately, across my state and across this country, and I'm worried about what we're going to be able to do for Cindy and others. And Dr. Figgan, as a physician and a former chief medical
officer, I know that you have seen firsthand how devastating it is not to have health insurance or access to care. So, I wanted to ask you, what kind of choices have you seen your patients make when it comes to health care becoming unaffordable? Would you be able to provide some insights on how many
Americans are likely to forego necessary or regular health care visits and what the overall consequences would be on our nation's public health? >> Well, it would be devastating on our public health. I mean, we already have, you know, a shortened uh four years shorter than most other industrialized
countries in terms of life expectancy. But what we see is that patients forgo preventive services, that patients don't get their blood pressure checked, that patients don't get uh papsmears, that they don't get mammograms, you know, things that don't hurt, um that, you know, they don't feel any immediate effect. And the results are that we're
we're treating more advanced age cancers, that we're treating more uh the cardiovascular disease that results from uncontrolled hypertension and uh patients with diabetes. Um, you know, the Rand Corporation did a study back in the 70s where they looked at co-ayments
as low as 50 cents to a dollar and found that co-ayments deterred people from necessary care just as often as unnecessary care. They repeated that study in the early 2000s where they looked at co-ayments for medications and they saw that patients systematically decreased the medications they took. First, they stopped taking their
arthritis medicine or they took it every other day or they took it once a week. The next thing they cut back on were their blood pressure medicines where they would spread it out over, you know, every other day or or stopped taking or taking once a week. The last thing they stopped was their diabetes medications. But we know when we put cost in between
patients and care that they make decisions and they aren't wise decisions and they will, like I said, they've shown deter people from necessary care just as often as unnecessary care. So there's a high price we pay because there's decreased productivity from workers um who are not able to function
at full force because of illnesses that go untreated. >> Dr. Figgan, these families that are seeing these prices double, triple, is it their fault? >> Absolutely not. >> Miss Strauss, these families, is it their fault that their prices are going up? >> No, it's the ACA in Congress.
>> And Mr. White, is it their fault? >> No, it's the law and the underlying medical inflation. I think we all agree there's a brokenness to the whole system and and I very much wanted to be on this committee to try to find bipartisanship in terms of a solution forward that can try to address this. But I I think the
challenge that I'm having, you know, Mr. White, Miss Strauss, Dr. Figgan, you know, there are lots of different plans that are out there that have been talked about, but do you see something, is there something that we've talked about that can be implemented in the next month that can offset the costs that
these families are are facing? Mr. White. Is there something here that you see that can be passed and implemented in a month? >> Uh within 2026, there's three things you can do. Uh the first thing I think is >> I'm not asking I'm asking about the remainder of 2025 before these
>> do it in 25. It will impact 26. So the first thing you should do is fund CSRs. That will reduce premiums by 11%. that was actually in the bill, the one big beautiful bill uh in the House version that passed >> that can be implemented by January 1, >> mid year, I would say >> mid year. Yeah. Anything that can be
implemented by the beginning of the year, >> you can immediately give those subsidies to consumers through through an HSA product >> that can be you're saying that that can be done >> 100% because bronze and catastrophic plans are now HSA eligible in every area of the country. You can take that $625
and give at least half of it to say is they're tied to specific types of health plans. Um, but more importantly, they cannot be used to pay for health insurance premiums. >> So, can you explain how that's going to lower the premium cost that these >> I would suggest that should be a fundamental part of that law that you
should allow those subsidy payments to go to those uh individuals as part of bronze and catastrophic and allow them to use those sub those uh dollars to pay for premiums. I I I'll just end here, chairman, as you're saying like, look, I'm I'm open to exploring different ideas that are out there, but Cindy, and
and all these other people that are facing, they're they're going to have the rug pulled out from under them. >> Why can't we even if it's not perfect, extend and be able to give them some support while we get our act together here? And and that is what I I just feel like they're seeing us and they feel
like we're playing with other people's chips. And they're right. You know, we're not the ones that are going to be feeling this. and I I just urge us to try to figure out how we can help them in the meantime. With that, I yield back. >> I'll take the chairman's privilege. If they order if they request a bronze
plan, they will have a lower premium. In fact, if you look at it, for most people on a bronze plan, it's less than 8.5% of their income, which is kind of the target we've been shooting for. they do get a higher deductible, but if you use
that subsidy to put it into a HSA, their net deductible can be lower. And as Mr. White said, we've already made those bronze and copper plans eligible for HSA, so that law is in place. The only
difference is that you want that subsidy to flow into the HSA to the patient instead of to the insurance company. So yes, you can lower premiums simultaneously with funding those HSAs under current law.
Thank you, Senator Banks. Uh Banks is next. So yeah, sorry. >> Thank you, Mr. Chairman. M Mr. White, you talk about um in your in your testimony, you talk about the role of hospital consolidations and the lack of
competition. You said nationally 97% of hospital markets are not competitive. That's certainly the case in Indiana. In Indiana, we have five uh major hospital networks who control almost all of the hospitals in our state. Can you give us a little bit more of a background on how
that happened? How did the ACA encourage hospital consolidations and and crack down on competition? >> Yeah, I think it built off a long-standing trend. we were already at 80% concentration by the time the ACA came online. Uh it just accelerated that
trend and um basically there were several things happening at the same time but a big change was in 340B uh the drug discount program available to hospitals that provided extra cash through markups for nonprofit hospitals to buy up uh other physician practices
to the point where now 40% of doctors work for a hospital. They don't work for themselves. uh pharmacies and then the second biggest thing was the medical loss ratio which allowed uh insurers to vertically integrate with PBMsarmacies
etc that those two factors were the biggest factors so we got to 97% you say so well so what uh it means we don't have free markets in these markets for hospital services for insurance etc um that means prices are higher so in hospital markets highly concentrated
hospital markets prices increase by as much as 30% % after a merger. And that those prices flow straight through to premiums. And that's and that's what everyday Americans are paying for. They're paying for these uncompetitive, highly concentrated markets. G give us good ideas to do something about it. I
mean, in Indiana, for example, we have we have a strong healthcare merger review law. Our attorney general gets a 90-day advanced notice to review all acquisitions. Is that a good model? Are there other good ideas of what we could do to create more competition in
hospital markets? >> Yeah, I think uh you know empowering the FTC maybe to look more at nonprofit mergers uh in particular um could use some statutory beefing up and enforcement authority. It's hard to get the toothpaste back in the tube though. These are big buildings, right? They're
it's not like a service company that you could break up. Um they're they're highly localized monopolies. And so I think taking a look at the economic incentives is important too. So right now we pay hospitals more for the same service that a physician uh delivers and and that should probably be the same
payment rate so that we don't have these economic incentives. On the input cost side what we see is those drug discounts through 340B are uh only given to nonprofit entities not to forprofits and so they get lower input costs they get higher reimbursement and they use that
cash to buy up other entities. So, I think local review boards, uh, a more beefy FTC enforcement structure and changes to how hospitals are actually paid in finance could go a long way towards, um, creating competition. The last thing I'd mention is that what we
see in local markets is anti-competitive contract clauses. These force uh, most favored nation pricing clauses. They prevent price discounts. They prevent uh, people in health plans from being sent to a lower lowerc cost, highquality provider. the Healthy Competition Act,
which um Chairman Jerry Jody Arrington introduced, uh would would ban those anti-competitive contract clauses and create free markets in those services that saves $5 billion and lowers premiums. >> You've been around uh the capital for a while. Can we find bipartisan support to
do some of that in your opinion? >> That bill is bipartisan. Yeah. And I think there's a lot of support for saying look if we have this much concentration and empowerment of this corporate big big health uh type systems. Um look we need to do something about this. This is the biggest cost
driver in healthcare today. Um and I think this committee obviously has a lot of jurisdiction over that. >> Miss Strauss um walk me through how the community rating works and how changing it to a 5 to one would bring down premiums. Yeah. So, prior to the ACA, we had the
ability to um rate people based on maybe their age and risk. So, at that time in Iowa, so I I lived in a state who had a solution for everyone. So, I know one of the senators mentioned, I think it was New Hampshire that um their state had
people uninsured completely. We didn't have that in the state of Iowa. if you were ever excluded or or ridered um a condition out, we had a high-risisk pool which really could be like the marketplace today um to help to manage some of those things. So when you had when we had our individual market
previously, the younger population was getting rated based on their age and their risk. So we had people in their 20s with premiums that were about $120. Well, when we went to this three to one ratio, a 60 year old and now this 20-
year old, all it did was inflated all of the numbers and brought everyone's rates up. So, right when we went into the ACA, that same 20-year-old person now had a $300 monthly premium. And these are the people who really weren't using the insurance. They had it for catastrophic reasons. Uh maybe they had a few things
that were going on, but we needed to keep them in the marketplace to keep the rates down, but all we did was inflated the rates on them. So they exited the market, which is what we're seeing today on a much bigger scale. People are just going completely uninsured because in their minds they don't think they need
to have the coverage, especially if they're paying $600, $700 a month for their coverage. >> Very helpful. Thank you. My time is expired. >> Thank you, Senator Banks. And now, Senator Blunt Rochester. >> Thank you, Mr. Chairman, and thank you so much to the witnesses. Um, we're all here today because health care in
America is unaffordable. um for families, for farmers, for small businesses. Uh just two weeks ago, I heard it from the Delaware Central Chamber of Commerce. We spent half our meeting talking about healthcare. Um we've gotten thousands of letters and emails and calls from our constituents
and many who are really concerned about this very present moment and what we're on the precipice of seeing. So, as we pursue solutions to lower costs for hardworking families, um I want to make sure we continue to hold this up as a
priority and a sense of urgency that it is and also remember some of the things that have gone before us so that we also don't throw out some of the positive things. Um, I thought about the fact that just 15 years ago, a woman could be
charged more than a man for health insurance just because of their gender. 15 years ago, those with diabetes or even asthma could be denied coverage or charged more for insurance because of their pre-existing condition. I hear
that so much from people. insurers imposed lifetime limits, as we heard Senator Hassan talk about, on what would pay for essential health benefits, leaving those with costly conditions exposed to significant financial strain.
So, the ACA changed those things to ensure that millions of people could get access to health care. That doesn't mean that it's perfect. that doesn't mean that we can't make things more affordable in this country. My concern
is that some of the proposals um some are really good. I signed on to Senator Marshall's bill right while we were here uh the transparency because that's something I've worked on in the House along with teleaalth and PBM reform. But some of what is being proposed might
leave patients to fend for themselves in an already complicated and overpriced health care system. If doubling or tripling in premiums wasn't bad enough, the Trump administration has also made it easier for insurers to stick patients
with more costs when they need care. In June, the administration changed the rules for private insurance that would increase out-of-pocket costs for 160 million Americans, including people who are covered through their employer.
This change would amount to a $900 more per year for a family with significant health needs. The rule would also allow ACA plans to raise deductibles while covering fewer services. In other words, pay more for less. Dr. Figgan, this
change is currently held up in court, but can you please explain how allowing insurers to raise deductibles and other out-of-pocket costs might impact individuals with chronic conditions? Senator, I saw patients who would tell me that if you know they were worried
about the carfare to come for a visit and that if we scheduled a test for them as well as on the week same week as they had a visit that I should choose between whether which was more important. So I think that we have a tendency to underestimate how small a charge can be
impactful in terms of patients in managing their care. As I said, you know, the study has showed that patients with co-ayments as low as 50 cents or a dollar made poor choices. Patients will make decisions about not getting screening tests or will not show up for an appointment because they can't afford
it this week. It's it's going to interfere with their rent payment or their groceries. So, at county, we saw this on a a day in daily basis. >> Thank you. Tomorrow I'll be introducing a bill to tackle these issues and make it more affordable and make health care
accessible. Uh my new bill, the Restoring Patient Protection and Affordability Act, will do four things. First, it will prevent health insurance premiums from spiking by extending the ACA tax credits for three years. Second, it would eliminate red tape and
unnecessary paperwork, making it easier for busy working people who want coverage to enroll. Third, it would force insurance companies to be more transparent about eligibility options. And fourth, it would lower out-of- pocket costs for millions of Americans,
including those with employer-based coverage. I urge my colleagues as we've had discussion here today and we've talked about different options. I urge my colleagues to look at this legislation. I think the biggest uh message if nothing else comes out of
this hearing is that we are 12 days away. 12 days away for many Americans uh of of seeing the end of open enrollment and them having to um make really difficult decisions and feel the impact.
And so um the clock is ticking. Um my time has run out as well. Um but I hope that we will as a committee and as a Congress act on behalf of the American people. Thank you and I yield back. >> Here here Senator Ulser Brooks. Thank you so much,
Mr. Chair. Um, I'd like to say I'm just really glad first of all that we're actually having um this discussion and conversation. This is I have to note the very conversation that my colleagues and I were begging to have um before open enrollment began. And so I'm really glad
that we're having it. And in fact, this is not an abstract policy debate for Marylanders. Uh you should know that my constituents are calling and writing and so many of them are sharing their stories with me and have done so at events across the state and even at my grocery store about their health care
premiums and how they will skyrocket next year. is an extreme concern and instead of solving the crisis, it feels like we've taken a time machine to a time before the Affordable Care Act reimagined what health care was supposed to look like when patients with
pre-existing or chronic conditions were either denied outright or priced out of coverage. And the Affordable Care Act, we know, is not perfect. And in fact, few laws are, but more needs to be done to increase affordability and access to coverage. and we should work together, I
believe, on good faith solutions instead of revisiting uh what I believe to be old rhetoric about gutting the patient protections at the core of the Affordable Care Act. And put simply, I am not willing to go back to a time when a family member's cancer diagnosis was a
sentence for bankruptcy. Um and so I have just a few questions. I'll start with one for Miss Strauss and Dr. Fegan. uh and it's that we know that pregnancy dramatically changes a person's calculus and need for health coverage. And before Thanksgiving, I introduced the Healthy
Mom Act, a bill that would create a special enrollment period for women to enroll in coverage after they became pregnant. Miss Strauss, your testimony recommends codifying short-term limited duration insurance plans. And I want to just be reminded about whether these
short-term plans typically cover pregnancy or maternity care. So, they can um if you're on one of those plans prior to being pregnant, then it would have coverage for you. But if you're trying to get it after you're already pregnant, there is underwriting involved in that. I do think though that the
Affordable Care Act does have a burden on these women who do get pregnant afterwards because of some of the restrictions and restraints around when you can enroll in the coverage. So, I do think that is something that needs to be looked at on the Affordable Care Act side of things. So then that way if
there is a pregnancy where maybe they did not have access to healthc care coverage previously but I also think there needs to be limits on it to get them to the next open enrollment date. So then that way they have to actually enroll and get signed up like they should have you know for that next
policy year. So I think there needs to be some parameters around it. But I do think in that situation, we should have some different um enrollment opportunities. >> And I agree because to be clear, these short-term plans actually do not cover um a pregnancy. 0% of the ones that we
looked at so far cover it. And I understand and agree with you that it actually should because just to, you know, be reminded, it costs $30,000 for a cacaian um and somewhere close to that for a pregnancy, a regular pregnancy. And so it is so draconian to suggest
that pregnant women should have to use half their salary if they have that much just to cover the cost of of pregnancy. And so that is what we're looking at when we talk about going backwards to a short-term plan. The the short just so you know in Iowa we did our insurance
division looked at those short-term limited duration plans and put additional parameters around there to protect situations like that. So, it if you haven't looked at the Iowa short-term limited duration plans, I would encourage you to do that. Um, but again, this is where each state comes in
with their population and has an ability to actually do something that is right for them. We had a plan prior to the ACA that covered everyone regardless if they had a new diagnosis of cancer midyear with no insurance. They had guaranteed issue. That's the program we should have
instituted instead of the Affordable Care Act to make sure the most vulnerable people in our society had coverage. So we went backwards in Iowa. This really destroyed our health care and the access to healthare. >> The vast majority of the country, I have to point out this is not the case. And
because my time is waning, let me just explain what is now anticipated is that we would go back to a time where pregnancy would not be covered. uh where individuals who have uh these cancer diagnosis and other chronic diagnosis uh
would have either this short-term plan maybe not covered or there would be some limit on how much you can cover. So if your cancer cost you $150,000 per year, it is the case that we're looking at a situation now where there's a a ceiling on how much of your cancer care can be
covered or how much your cystic fibrosis care can be covered. uh we're we're looking at a time again we're we're totally going backwards. Um and I wanted to be very clear what we're asking people to do is to again face a time where it is more expensive to be a woman
and where if you're sick or if you're vulnerable your your health care cannot will not be covered. Senator, I'd like to add that in the last 20 years unlike any other industrialized country in the world, the maternal mortality rate in this country has gone up. When I went into practice, you know, 40 years ago,
it was less than 10 and is now over 14 women died for every 100,000 live births in this country. >> We are unlike any other country in the world, >> the wealthiest country in the world. Thank you. >> Thank you so much. And u by the way, my
wife ran all women's health for America in the Clinton administration. She was assistant surgeon general, two star admiral. So appreciate your service, what you do. absolutely an ongoing critical issue that we have to work on. And uh I appreciate this opportunity to
discuss the challenges Americans are facing to afford their healthcare. Yet I cannot overlook the cruel irony that President Trump and my Republican colleagues are blaming rising costs on the very protections and programs that have helped to make health care more
affordable for so many. Just this summer, uh, Trump and Republicans cut$1 trillion dollars from Medicaid, stripped 15 million people off of their health care to give CEO billionaires tax breaks. And for the past year,
Republicans have ignored the ticking health care time bomb of expiring ACA premium tax credits. So now heading into Christmas, instead of picking out presents, millions of families are wondering how will they be able to
afford to stay healthy when their premiums double or triple next month. So M. Strauss, in your testimony, you described the ACA as restricting flexibility and driving up costs, but the reality of the flexibility before the ACA was that health insurers
regularly excluded pre-existing conditions and cap benefits and families were drowning in medical debt and bankruptcy. So, I'm a little bit dismayed that you and some of my Republican colleagues want to take us back to a time when people with chronic
conditions were regularly denied coverage. Uh, the only ones likely to benefit from those recommendations are healthers looking to cut benefits and force families to pick up the tab. And as the ranking member of the Senate
Small Business Committee, I appreciate you being here testifying on behalf of millions of small business owners. However, uh I just want to tell you that there was a recent survey that found 87% of small businesses owners want the ACA
tax credits to be made permanent. 87%. There aren't many things you can find 87% as a um as a um as a number that touches any polling number. And I'll tell you why. 10 million
uh small business owners and their employees who rely on the tax credits to afford health coverage um are actually going to lose their health coverage or see a 50 to 75% increase. That's 10 million small business people um right
after Christmas lose this benefit. And those are Kanians. Those are Rotarians. That's Main Street America. I mean, Main Street America is going to be turned into pain street America on January 1st of next year, five weeks from now, four weeks from now. Just absolutely
unbelievable. So that's a big, you know, problem that I have just in even talking about small businesses that they are absolutely going to get crushed across the country. Dr. Figgan, you have spent over four decades caring for patients. Some of the Republican proposals we
heard today focus on expanding health savings accounts and encouraging people to enroll in junk plans with higher deductibles and fewer benefits. But as you know, millions of Americans can't even afford to cover an unexpected
expense for over $400, let alone contribute to an HSA. Would you say that increasing access to HSAs is an effective replacement for families who will lose either their Medicaid coverage or premium tax credits next year?
>> It is not. Um, we actually refer to the junk policies as something like a hospital gown. looks pretty good in the front, but everything's hanging out in the back. Um, it creates the illusion of having coverage, but when you actually need it, it's not there, and it's not sustainable. >> Okay. And what's hanging out in the
back? What don't they get? What will they be missing? >> Well, it's the out-of- pocket expenses that they have to uh shoulder. Uh, people have the illusion of coverage, but because of the high deductibles and because of the um high co-ayments, u people make decisions about foregoing
care or not getting a test. So uh and at the end of the day they have uh less care. >> Yep. So yeah. So we just have to be realistic about what is about to unfold. It's 22 million Americans, you know, who are about to see a loss of their health
insurance or u a dramatic increase in their costs. And uh I have one I have one man in NICT, Massachusetts, Jeff, who right now his
his cost for stage four lung cancer drugs is 30,000 a year. Beginning in four more weeks, it's going to 300,000 once this um once the ACA tax credits expire. And there's going to be 22 million other stories that are being
told at the dining room tables all across the country uh on Christmas Day. So, we've got to solve this problem. We've got a good solution already in place. We just can't allow it to expire. There'll be a health care uh catastrophe which will be unleashed on families
across the country. Thank you, Mr. Chair. >> In the interest of an informed discussion with the problems Dr. Fegan identifies with a health savings account are actually the problems with the status quo with the $6,000 deductible. If you give somebody a health savings account with say a,000 or $2,000 in it,
they actually have first dollar coverage for their deductible and their co-pay and their net deductible would be less than status quo. So I think and they're it's preunded, not funded out of their wages. So I think that's a misconception that's been repeated several times here.
It is a misconception with that. got. This concludes the hearing. I thank my witnesses for being here. I thank my colleagues. It was very well attended. Uh questions for the records will be do. Hold it. Hold it. Hold it. The pinch the tension is building.
Um at close of business. What's today? >> What's that? >> 17th. >> Any senator wishing to ask additional questions? Questions for the records will be due 5:00 p.m. Wednesday, December 17th. Thank you again for being
here. We are journed.