Transcripts For CSPAN2 Senate Health Committee On Lowering Health Care Costs 20240714

[inaudible conversations] the committee on Health Education and labor and pensions will come to order. Senator murray has an important meeting right now and she is asked me too proceed with the hearing because we have six excellent witnesses and we want to make sure we hear from each of you and we want the senators to has questions of each of you. So patty should arrive at about ten. When she comes we will interrupt and let her make her Opening Statement and we will resume the hearing. Good morning senator murphy. Nearly a year ago doctor brent james from the National Academy testify before Senate Health committee with a startling statistic up to one half of the American People spend on healthcare may be unnecessary. Let me repeat that, up to half of the 3. 5 trillion, the United States collectively spent on healthcare in 2017 was unnecessary according to doctor james and many of the other witnesses at our hearings agreed with that. That is 1. 8 trillion, three times as much as we spend on all of her national defense. 60 times as much as we spent on programs for college students. About 550 times as much that we spend on national parks, a recent poll found that the cost of healthcare was the biggest financial problem facing American Families. Like every American Family both democrat, republican and United States senators are concerned about the cost of healthcare. It would come as a tax on the Family Budget and a business and federal state government. Warm buffet called it a tapeworm on the american economy. Over the last two years this committee has held 16 hearings. The wide range of topics related to reducing the cost of healthcare, specifically, how we reduce what the market people pay out of their own pocket for healthcare. These include hearings on the cost of Prescription Drugs on the discount program. On primary care and on the importance of vaccines. Last December I Spen sent a leto the American Enterprise institute and the Brookings Institution to doctors economist, governors, insurers, employers and other healthcare and debaters asking for specific steps that congress could take to lower the cost of healthcare. We received over 400 recommendations, some as many as 50 pages long. In may senator murray and i were released for discussion for lower healthcare costs act of 2019. A package of nearly three dozen proposals. From 16 republican senators and 14 Democratic Senators. That is designed to reduce what americans pay out of their own pockets for healthcare. Since then we received over 400 additional comments on the legislation. Todays hearing was scheduled to hear your feedback on the legislation that will reduced what american pay out of their own pockets for healthcare. First it in surprise billing. Second, legislation creates more transparency, seven bipartisan proposals in the bill that will eliminate gag clauses in anticompetitive terms in insurance contracts. Designated nonprofit entity to unlock insurance kick claims for employers and pharmacy benefit managers from charging more for drugs than the pbm paid for drug. And require patients to give more information on the cost and quality of their care. You cannot lower your healthcare cost until you know what your healthcare cost actually are. And third, it increases Prescription Drug competition. There are nine bipartisan proposals within the legislation to bring more lowercost to buy similar drugs to patients and thats about 90 of the drugs prescribed. Here are a few ways that it will lower healthcare costs. Ensure the patients dont receive a surprise medical bill which is when you receive a 300dollar bill or maybe a 3000dollar bill, two months after your surgery because one of your doctors was outside of your insurance network. Many senators including senator cassidy, hassan, michalski and others are interested in indian surprise billing. The lower the cost of Prescription Drugs by helping Similar Companies Speed Drug Development through transparency modernized and searchable patent database. Senators collins, kaine, holly, michalski, shaheen and stamina have worked on this provision. It proves the food and drug ministration database by keeping a more uptodate to help Generic Drug Companies Speed Drug Development and a proposal by senator cassidy and senator durbin. I mentioned these names on purpose because i wanted to be clear how much work has been done by Democratic Senators together on the provision of this bill. Prevent the abuse of petitions that can be used to unnecessarily delay drug approvals. Sender gardner, shaheen, bennett, cramer and ron clarifies that the biological products such as insulin are not gaming the system to delay new lower cost from coming on the market. Senator smith, cassidy and cramer. It will allow a loophole just by making small tweaks to an old drug. A proposal from senators roberts, cassidy and smith. The gag clauses, prevent employers and patient from knowing Healthcare Services. This would allow an employer to know for example that any replacement might cost 15001 hospital and 35000 in another. Requires Healthcare Facilities to provide a summary of services it requires hospitals to spend all bills within 30 Business Base to prevent unexpected bills many months after care. That is from senator enzi and senator casey. It requires doctors and insurers with price quotes on their expected outofpocket cost for cares so patients can shop around and proposal from a number of senators including cassidy, young, murkowski, braun, hassan, bennett, kc, whitehouse and rosen. It increases the fox nation rates for disease outbreaks by senator roberts and peterson. There are more proposals. For example banning anticompetitive terms that prevent patients from seeing other lowercost higherquality providers. The wall street journal identified dozens of cases where anticompetitive contracts between Health Insurance and Hospital Systems increase premiums and premium choice. Banning pharmacy benefit managers or pbms from charging employers, Health Insurance plan in patients plan more for a drug than the pbm paid to acquire the drug. Which is known as bread pricing. Eliminating a loophole with the first generic drug to smitten obligation to the fda that can block other generic drugs from being approved. Provisions to help americans stay healthy by preventing obesity and care for expected new moms and their babies. Provisions to make it easy to get your personal medical records as it is to booking a plane flight. Provisions to incentivize Health Care Organization to use the best Cyber Security practices and protect your Health Information privacy. And other senators may have additional ideas that we hope to be able to vote on in a markup later this month, for example. Senators murphy and senator cassidy are working to improve access to Mental Health care will lean on their work in this Committee Last year that became a part of the support act. I am optimistic that we can get to the agreement to include something on that in this bill as well. Other committees in the senate are also working on their own packages of legislation to lower the cost of healthcare since january, senator murray and i have been working in parallel with senator grassley and wyden who had the finance committee. They are working on own bipartisan bill which they plan to markup this summer. The Senate Judiciary committee is working on bipartisan bills to address high drug cost and held a hearing on consolidation and healthcare. The house of representatives, energy and commerce ways and means in Judiciary Committee have all reported out bipartisan bills to lower the cost of Prescription Drugs. Secretary azor and the department of health and Human Services have been extremely helpful in reviewing and providing Technical Advice in a timely way on various proposals to reduce healthcare costs. In the president has offer and it surprise billing and reducing the cost of Prescription Drugs and the ministration is also taken steps to increase transparency so families and employers can better understand their healthcare costs. For the last decade, congress has been locked in an argument about the individual Health Insurance market. Were 6 of the americans get their Health Insurance. Especially for americans without subsidies, the cost of Health Insurance remains way too expensive and im sure that the debate how to fix that will continue praying but that is not this discussion, this is a different discussion. We will never have lowercost Health Insurance until we have lowercost healthcare. Which is why our lowercost healthcare cost act of 2019 takes steps that will bring down the cost of healthcare that americans pay out of their own pocket. It will lead to doctors, hospitals Insurance Companies and employers providing americans a better experience in a better outcome at a lower co cost. I want to think senator murray and her staff, she is not here at the moment led by evan shots and my staff led by david who Work Together to find about three dozen proposals and the democrats and republicans agree on to reduce healthcare costs. This is not unusual for committee because we found a way to provide solutions to difficult problems that members of both republican and democratic caucuses can support. We did that with fixing no child left behind, the 21st century cures act, user fee funding for the drug ministration and most recently in the midst of all the fireworks over justice, we had 72 seminars on both parties working together to produce the legislation that dealt with the au pair crisis. Our goal for this legislation to lower healthcare costs act of 2019 is to be one more example of that cooperation because the American People expect this. To Work Together, provide ways, reduce what the paper healthcare out of their own pocket. Now as i mentioned earlier we will proceed with the witness testimony and i will introduce witnesses now. When she comes off to make her Opening Statements. I am pleased to welcome the six witnesses, Sean Cavanaugh is a services chief administered officer in the startup founded in 2014 and works to develop the accountable organizations in order to reduce healthcare costs and improve care. We join him in 2017 and the same year he served as an advisor and innovated bostonbased company as well as a model health, marcr of the senate for medicare at the u. S. Centers for medicare and Medicaid Services and he now sits on the board of directors of the center for medicare advocacy. He is a graduate of the university of pennsylvania and received his master and Public Health from john hopkins. Doctor ben is an Economic Policy Research Fellow at the American Enterprise institute and he focuses on health economy, economics and Health Policy and a lot of his recent work and specifically surprise medical billing and he graduated from emory before receiving his master and phd in economics at the university of wisconsin madison. Nichols is executive Vice President of Government Relations of the American Hospital association representing approximately 43000 individuals and served nearly 5000 hospitals, Healthcare Systems and Healthcare Providers and he is been with the American Hospital Association Since 1994. He was director of the American College of Emergency Physicians Washington Office before that. Senator collins would you like to introduce ms. Mitchell . I would. Thank you, mr. Chairman and i know i speak on behalf of of all the members of the committee. And welcome you back and saying its great to see you looking so well. I very much appreciate the opportunity to be introduced to elizabeth mitchell. Although she is testifying in her role as the president and ceo of the Business Group on health, i want the committee to no that she is the native maynard who we hope is only temporary living on the west coast. Before her work to occur across the country ms. Mitchell led a multitude of Healthcare Organizations in the state of maine including serving ceo of the main Health Management coalition in the network for regional improvement in portland. In her role she was a powerful catalyst for healthcare transparency and Quality Improvement and she served in the main state legislator. Although ms. Mitchell and i are in different political parties, i tell you that i always found her work to be insightful, practical and nonpartisan. Given her extensive efforts to improve healthcare transparency and quality, i was pleased to recommend ms. Mitchell for the federal position focused payment model technical advisory committee. One of the longest committee names possible where he served as vice chair. I very much look forward to hearing elizabeths testimony this morning from an Employer Perspective pray thank you, mr. Chairman. Thank you, senator called waukomis mitchell. Mr. Frederick as aussies executor director of nonprofit Consumer Health Advocacy Organization with highquality inpatient Community Center and he was once helped division bipartisan National Governor association for best practices in addition to his work for the governor he served as Vice President for Health Policy at the Advisory Board commission and a Senior Legislative Council on the finance committee in the Senate Pension committee for a friend and former senator jeff. Welcome. And our final witness is marilyn bartlett, special projects court nader for the state of montana commissioner of consider insurance. She is recognized as a leader in healthcare cost reforms and initiatives as well as improving benefit plan costeffectiveness before working for the montana commissioner and she served as Healthcare Benefits Commission Administrator for montana for 33000 individuals distributed 200 million in annual benefits. She is credited with negotiating the Healthcare Plan cost and increasing healthcare transparency. Thank you to all of you for coming, mr. Kavanaugh lets begin with you. Thank you, mr. Chairman. Im Sean Cavanaugh chief administrator and we partnered with independent physicians and 24 states and succeed in payment models. He mentioned doctor james testimony we talk about the normas amount of waste in Healthcare System. We all face a fundamental decision of how we will get rid of the waste in a boil down to a choice of two approaches, one is competition and the other is relational. I personally have a background in regulation. One might say the ultimate regulator. You mentioned i worked at cns, i publish them all year long and ministering prices in a previous career i worked. We should reliant competition not regulation. I applaud the approach this committee is taken to ensure competition works wherever possible. We believe maintaining a robust independent physician sector is essential to supporting competition and highvalue care. Importantly this is at risk as hospitals have aggressively been purchasing progressive actresses. It is a growing impediment for competition and highvalue care. Over half the market in this country are considered highly consolidated by injective standards of consolidation. We know when hospitals emerge price increase in quality stagnates. They argue the consolidation will be two more courtney to care but the evidence doesnt bear itself. Gag pauses, antisteering an all or nothing causes are prime examples of excess market power enabling anticompetitive behavior. These run counter to the movement to valuebased care. How it supports title iii they should restore competition with a overly consolidated market. Other provisions with support. Surprise billing occurs because of a market failure. We applaud this committee willingness to take on the issue and the willingness to consider multiple solutions and put patients interest first. For many years they studied the American Healthcare system have relied solely on medicare claims data. The problematic care is very different the private insurance sector and the patients are very different as well. Any competitive behavior has been exposed by using multipayer claim basis such as when a minister by the healthcare cost in situ. Applaud your restriction of pbm, they should be competing on the basis of helping. To generate the revenue that way. Not taking advantage of asymmetry between drug manufacturing. Finally while i support time limits, i think thats very patient centric. We work with quite a few small practices in rural practices. We wonder whether some of them might struggle with a 30 day limit i asked committee to consider whether rural practices should have a longer timeframe. Finally i want to mention a couple that the committee has not done and should consider in future resolution. Eliminating facility fees work be provided in a Physicians Office, these fees are unnecessary and helped fuel hospital consolidation. Any sports physicians, one repayment programs even for those who work for private practices would be great. We encourage the committee to reform restrictive seo and rules which gives hospitals monopoly powers. We encourage to reinvigorate and specifically grant the ftc to review potentially behavioral hospital. Finally her personal story, we believe hospitals should be required to share pace it centric data. There is literature that shows when a patient is discharged from hospital into the primary care physician, they do better, they are fewer remissions. That is one of our biggest strategies, how are doctors visit patients after discharge. We go to local hospitals and say we will bear the cost of the interface and bear the cost of setting up you alerting us when these patients are discharged. Most hospitals comply because they realize its good for the patients. There is a subset of hospitals that refuse. Cms has proposed a rule and we are supportive of that. Anything that foster patient centric data the committee should support. Thank you for your time mr. Chairman. Thank you mr. Kavanaugh for your testimony. I thank you very much. Chairman alexander, Ranking Member murray and members of the committee i thank you for the opportunity to appear before you today to discuss the lower care cost act. I am an economist in Research Fellow at the American Enterprise institute. I first want to apply the committee on the evidencebased and constructive proposal. Together the provisions in this bill will meaningfully increase competition and transparency in Healthcare Market. Its inactive this legislation would lower insurance premiums and drug prices for consumers. It would ensure patients are no longer exposed to Surprise Medical Bills. By lowering cost this would improve access to healthcare. It is a proposal in one of the most impressive bipartisan Health Policy bills in recent years. Much of my recen recent testimoy submitted to the Health Committee by Health Policy experts at aei and the Brookings Institution earlier this year. In my remarks this morning i will focus on two provisions of the lower healthcare cost act. Mainly establishing a Transparency Organization to lower healthcare costs and ending Surprise Medical Bills. First the provision established a nongovernmental entity that would assemble data for commercial insurers would have her understanding of the private Healthcare Market. I will echo previous comments by saying the federal government that already regulates many parts of the private Healthcare Market, yet much of her understanding of healthcare has come from public payers like medicare. As it was previously noted, this represents a sudan show problem. Ensuring a vibrant and competitive private market requires that they are not flying blind. Assembly National Data on the private market in this manner would improve research and in turn improve policymaking. I would like to discuss the surprise medical billing a future that has received considerable recent tension. All three proposals including in the draft legislation represent serious attempts to resolve this issue. With that said, adopting in network guarantee is the best option. It represents a straightforward and market oriented way to stop Surprise Medical Bills before they ever occur rather than adjudicating them after the fact. Bypassing hospitals ensuring physicians are in network for insured patients they would need to bargain over prices themselves. Rather than having those prices set by arbitration. Physicians that work in hospitals would have two choices, either they could come to an agreement with the insurer as many arty do or they could choose to be paid by the hospital as they prefer. This would force the small number of bad actors to stop surprise billing and impose little additional burdens on the majority of providers who do not engage in this behavior. This approach is a sport from policy experts including those at the Brookings Institution and the center for budget and policy priority George Taylor law, Yale University and aei. The in network guarantee is only option that would fully adjust the market failure that gives rise to surprise bill. And an economist at yale for the exercise. The resulting payments will be generated by market sources. I agree with these assessments and think this is a big point worth emphasize. With again network guarantee there are no more surprise bills to adjudicate after the fact. To tell us which of either the provider is be more reasonable. The bill does not happen in with figuring out what inappropriate market prices. In an alternative option would have to be out of network bill. And understand the appeal of this process i think in practice arbitration reads of setting a simple benchmark. The arbiter ultimately must decide what a reasonable price services. Just like any price underway. Moreover the process is less transparent and it includes unnecessary expenses and it be unpredictable. It takes the resolution out of the hand of market actors. It does not stop surprise bills from occurring in the first base. An arbitration scheme is not the best option for surprise billing. While some pieces are yet to be finalized i want to be clear on one thing. This bill represents a very impressive bipartisan effort to lower healthcare costs for americans and i applaud your efforts and thank you for the opportunity to be here today and i look forward to your questions. Thank you doctor. Senator murray has asked to take the witness statement and then she will make her statement at the end of this. Mr. Nichols welcome. Thank you mr. Chairman my name is tom nichols on the executive Vice President for making House Association to represent 5000 member hospitals. The committee has identified several important areas where we can make the Healthcare System work better and cost less for patients on each of these we stand ready to work with you. On surprise medical bully we must protect patients from Surprise Medical Bills and the federal legislative solution to do so. Protecting patients means limiting costsharing as a draft legislation does and keep the amount of oni negotiation between providers in the health plan. Once the patient is protected they should be allowed with their appropriate reimbursement. The committee put forward surprise billing. The in network guarantee or Network Matching approach would require facilitybased practitioners to contract with every plan which a facility has a contract. This approach interferes with the fundamental relationship between hospitals and partners and limits practitioner ability to negotiate with insurers to be hard for rural areas that are challenged to recruit practitioners. We believe they should not be absolved of the core function of establishing Provider Networks and negotiating rates with providers. The second option is independent dispute process with bills paid at the meeting contracted rate and they believe they should negotiate reimbursement for outofnetwork claims without government involvement there may be a role for dispute resolution process but certainly physician claims. We urge the committee to look at s1531 to modifications as an option for outofnetwork reimbursement. This allows a marketbased, flexible and negotiation to take place. The structure of the process outlined in s1531 is positive we believe an automatic payment prior to initiating the resolution undermines the provider negotiate a fair reimbursement. The baseball style similar to what new york state and many other states have implemented in which it does not include hospitals appears to be an efficient process and places the responsibility to initiate the request with the provider or health plan not the patient. Studies shown at 34 reduction and they have been largest but between providers and pears and there has not been a noticeable inflation or impact on peruvian cost. The third option is to establish a benchmark rate. We opposed the rate for outofnetwork services from being contracted even geographically adjusted as it would not be able to capture the factors that health plans and providers consider. We are also concerned setting the standard will serve disincentive sure insurers for Provider Networks. We share the committee goal of increasing transparency in Healthcare System however, we have concerns with a couple of the policies proposed. For example providers from declining unfair tearing or steering restrictions imposed by insurers. We believe these and other provisions would infringe on provider and Health Plan Contracting in a way that could limit the ability to pursue care delivery models and purchasing arrangements designed for quality in coronation or reducing costs. Another way commercial insurers cannot be allowed to have it both ways. That is enjoy the savings from provider risk under a value base simultaneously encouraging the same patients to go elsewhere for care. Likewise it be unfair to allow commercial insurers to cherry pick which hospital in the system they contract with. We urge the committee to remove their provisions. I want to thank the committee to improve the americans by making investment in Health Qualities like vaccinations and data systems. We appreciate the committees internal health to work outcome of mothers and babies in reaching to partner aid in this effort. I also want to thank you for your efforts to reduce drug prices they mean that many of her patients simply cannot afford medications and they cannot be managed. We support the drug pricing provision bill each seems to increase competition and we entered testimony in additional actions the committee may consider such as increasing as francie through the fair act. Mr. Chairman we have an opportunity to help patients and we look forward to working with you. Thank you very much. Thank you mr. Nichols. Thank you, senator alexander, thank you for this opportunity. Im ceo of this group were Nonprofit Coalition of public and private purchasers seeking for higherquality on our employees. It is an honor to be here, this is the right discussion to be having. Thank you for your bipartisan leadership. They spent over 100 billion annually. Purchasing healthcare on behalf of their employees collectively for over 50 million americans. Our members are deeply committed for the health and wellbeing of their employees and buying Healthcare Services that promote optimal health. Even the largest purchasers of healthcare in the world cannot overcome the current industry consolidation, anticompetitive practices in egregious pricing in u. S. Healthcare. It may seem surprising that organization representing Large Private Sector Companies would seek policy intervention in the market. Members are committed to private sector marketers and solutions but most of the Healthcare Market is simple broker. A function market does not regularly drive families into bankruptcy. It does not depend on gofundme campaigns for treatment cost and it does not absorb a decade of u. S. Wage growth. If the Worlds Largest and sophisticated companies are challenged for high quality and Affordable Care it is unfair to expect that of Small Businesses or families. It is so profound that we are seeking your support to make a functional market in the u. S. Healthcare system possible. We believe this bill goes a long way to achieving that. There are several important points, strong evidence that costeffective delivery is expected. Government action is about needed. We also support your efforts to control drug pricing and urge you to go even further. And to include provisions that support primary care and Mental Health. Most of portly we want to say its possible and we are bold innovations driven by employee managers. Walmart recent pilot for specialty services, this is a program the employer of senator excellence is allied by walmart for hip and knee replacements and surgeries. We set high quality standards the intellect the best facilities in the country and support employees to use these. I provided a recent article in the results of the program but is important to highlight patient reported 90 satisfaction and better patient reported outcomes. Readmission and complication rates were markedly lower. They demonstrated that it is possible to save money by reducing Unnecessary Services and improving outcomes and patient experience. While highlighting the bill seeks to address our barriers to Widespread Adoption of this model. Additionally we support the elements that would remove gag causes on ensuring price quality providers. It is hard to imagine that providers are barred from sharing information about qualifications. We strongly support the elements that would be an anticompetitive contracting prices. In similar clauses that are used to gain market power and raise prices irregardless to quality. We urge congress for beneficiaries identify centers in a similar program. We also strongly support the protection of patients with outofnetwork adjustable, surprise billing and we support option three a benchmark for payment. We recommend studies based on payments to physicians, 125 of medicare rates. While it may be unusual, we believe this captures the cost and its a straight forward efficient and transparent approach to regulating the prices. A secondbest solution would be media contracted payment rates although we are concerned that the benchmark and the end of this message would reflect prices that are too high. We strongly also recommend the services be expanded to include ground and air services. This is a problem and we understand states are limited in addressing this problem due to jurisdiction and authority and its up to congress to fix this directly. We strongly support all the transparency initiatives including establishment but would urge you to consider complete data access including pricing and allotted amount for the facility of the base and we would ask that physicians and patients have a key role in the governance of a database and that these data sets are mutually accessible and correlated with Regional State databases. We look forward to additional questions and discussions and most of the provisions in the bill, particularly and finally we strongly support everything included in the bill that would address drug pricing and ask you to go further. We also support the element that will require pharmacy benefit managers to plan sponsors. The lack of transparency makes it impossible with no prices rebates and other pricing complexities much less negotiate lower pricing. Thank you. They commence mitchell. Figure very much. Members of the Health Committee. Im the executive director of families usa and for nearly 40 years we have served for voices for healthcare and consumers on the state level. Our mission is to collect every individual to live the greatest potential by health and healthcare are equally assessable and affordable to all. Thank you for the opportunity to testify. The cost and quality in healthcare is a profound economic problem. In a bipartisan issue. It is almost half of the public cannot see a doctor when they need to because of cost. About a third say because of healthcare cost per new under nearly two thirds we as a nation need Healthcare System. An analysis of her Healthcare System to support public reception. Despite spending two or three times more than other wealthy nations on healthcare, we live shorter lives than those in other wealthy nations. The u. S. Healthcare system is likely to fail its people and even our moms and their babies are dying at higher rates. As a nation we can do better for families and well past time that the Healthcare System change. Families across the country who face every healthcare costs are forced to make on potable decisions, pay a medical bill or buy groceries to feed the family. Pay an electric bill to keep the heat on or by a childs medication. At its worst outofcontrol healthcare cost and lack of highquality can be truly devastating. I would like to talk about deborah from the chairman state of tennessee, a remarkable woman who shares her story with family usa story base. Deborah worked hard, she went to college, she studied, she graduated in for many, many years worked in excess assessable career as a microbiologist for the state of tennessee. In 2012 after going to the hospital for routine hip replacement she received a hospital infection. This created a multicycle of infection illness that resulted in her losing her job and losing almost everything she worked for. Following the surgery on her hips to her vertebrae and desk and by 2016 she was at risk for full spinal crops. She had ten back surgeries and a time she was placed in a druginduced coma. Today deborah is bedridden and in extreme pain. Since her first surgery she has moved from employer coverage to the tennessee Health Insurance marketplace and medicare. Despite this coverage paying for her care has taken all of her savings. Deborah told us i had about 2 million in surgery plus a bunch of other expenses in an antibiotic that cost a hundred and 50 a day. Before this, i had a brandnew house, brandnew car, the car was repossessed and almost went into foreclosure. She was in the hospital when the repo papers came, i play my life 20 years ago and i did not expect this to happen. It hit me so hard and it took everything. This is not what i thought would happen to me. Any of us, could be deborah, any of us could be building a lives in saving and then because of poor healthcare quality and autocare cost it can be taken from us. It is time for our nation to take a long hard look at her Healthcare System, the system that works for families to ensure the best. Not threaten our economic dependence. They strongly support the healthcare cost act and its an important step in the right direction and we provide comments and recommendations about the legislation. Before i conclude i was hoping to focus on the legislation prohibition on supplies medical bills. The legislation would end the practice and profound it creates. It would be in charge of patients outofnetwork rakes. This is most critical. The legislation also would establish that providers cannot charge outrageous amounts of money for these categories of outofnetwork services. Recent studies have shown as providers, skull has reached an alltime high and a lack of competition to charge escalating prices. These prices are essential reason why all of us continue to escalate so quickly, we support and encourage to maintain the provisions that not only prohibit outofnetwork surprise bills but the outrageous sums being charged for the services. The work you do is absolutely vital to the health and wellbeing of everything a person. Thank you again for the opportunity to testify and i look forward to responding to questions. Ms. Bartlett welcome. Chairman alexander, distinguished members of the committee. I am honored to speak today about my success. When i was appointed administrator of the montana speech Employee Health plan reserves were projected to be at minus 9 million and less than three years. Instead the reforms that we implemented resulted in a reserved balance of 112 million in that timeframe. I then joined find haner to research and draft elucidation for Prescription Drug costs. The montana base plan was provided through purchasing cooperative of seven different contracts or research the contracts and data file. Arbitrary changes to reimbursement and limited rebate past there. I terminated these agreements. And we contracted with the pbm that offers full pastor model with audit ability. When cbs refused to accept our level of reimbursement, i immediately 1. 6 million was saved for montanans. This is the first year on a new program that we saved 7. 4 million, 23 . That might not sound like a lot to some of you for much larger states in montana. But in the u. S. The privately insured market has 140 billion in pharmacy spend, a 23 reduction could generate 32 billion in savings. After that it is fed pricing to generate healthcare state. It also addresses compensation disclosure for brokers and consultants. The current one is flawed. The brokers consultant act with the buyers agent but most often it is paid by the sellers to confidential agreement. My colleagues found that 17 undisclosed Revenue Streams for brokers, consultants, pta, associations and other cost with an employer plan. I needed consultant expertise to help us make the changes that we had to take place in the montana plant. I contracted with alliant who had my back fulltime and contract only allowed for direct compensation to them for the plan. Compensation disclosure and consultants made a good step in and recommend the committee strongly consider giving these requirements to all parties that provide products or services to a plan. The bill includes traditional transparency intended to put downward pressure on cost by the increasing visibility. In my experience these transparency efforts are only effective in reducing total cost if you also pay advantage apprentices and the prices must be fair. If i dove into the claims data i found extraordinary variations charged by consumer hospitals for identical procedures. The 2. 0 study confirmed this level of variation across the United States. Hospitals developed a secret charge master for the prices that you cannot see so they set price inside the charge master in the Insurance Company or the tpa comes in and negotiates a secret discount off of the charge master. When i dove into the information it was very plain to see we had no control. So i contracted with allegiance benefit Management Plan as her tpa and together we negotiated reareimbursement rates and contracted with montana hospitals including our 38 rural critical hospitals. Medicare pricing is a common available reference and we have a multiple of it. We are now paying a transparent and a fair price and its changed on its own, its saved millions of dollars for the health plan of montana. Hospital payments consumed 40 or 50 of the plan resources so i urge the committee to consider provisions to force hospitals to justify their prices not just disclose them. I am an accountant, i follow the money. I saved Montana State employee planned millions of dollars while not raising employee or employer contributions over a fiveyear period. I did this by analyzing data, demanding more from transparency and fair pricing and finding the right partners in taking the money out of the system and giving it back to the taxpayer in the members. It was my duty to do so. The bill before you demand Better Business practices from a Healthcare Industry and i thank you for that. Thank you ms. Bartlett and thank you to all the witnesses. We will go to senator murrays Opening Statement and then will have questions. Thank you very much, mr. Chairman and thank you tour witnesses today. I too have heard from families across my home state of washington who are really struggling to afford healthcare and ive been absolutely clear from the start, democrats are at the table and we are eager to work with republicans to bring costs down for healthcare for all. The bill we are talking about today is an important step in the right direction. It was also proof when republicans rent the table and bipartisanship and put our Families First we can find Common Ground and help people for extra relief on healthcare paid people like stacy, woman from seattle who wrote to my office how she got an unexpected er bill for over 1000 after she had a bike accident in the hospital she visited was in network one of the doctors who treated her was not. And stacy also shared how her mother has struggled with healthcare costs because after her mother was diagnosed with type one diabetes she was forced to move in with stacy to afford her insulin. Families like stacys and so many of them are looking to us for help and im glad our legislation works to address surprise billing so people like stacy will not get caught off guard by charges for outofnetwork care. I especially want to thank senator hassan, cassidy and murkowski for their work on this issue. This bill opens the doors for cheaper generic insulin which could bring down costs for stacys mom. And make it harder for Drug Companies to gain system him put up a roadblock to competition from cheaper generic drugs. I want to thank senator kaine, shaheen, smith, cassidy, collins and many others who are working together on many of the ideas on this bill. Those are just a few of the many common steps we were able to come together on. Thanks to the work of senator peters, duckworth and roberts it includes a strong response to vaccine hesitancy. And supports efforts to counter misinformation and increase fox nation rates in communities at reese of outbreaks. In includes investments of Health Data Systems push for by kaine, king and eyes missing to prevent families against Public Health threat and would ensure the state, local and Tribal Health departments have guidance on obesity prevention effort thanks to senator jones and scott. It concludes a proposal to help expand the echo telemedicine model which we heard about in our hearings on the opio crisis so can be used to bring care to more people in more places and help direct healthcare needs. And proposal to update Health Records to make health data were assessable for providers and patients alike and take a much needed step to respond to our countrys Maternal Mortality crisis including supporting investments and care for pregnant women in providing implicit bias training to help address the fact that women of color in particular are dying unacceptably high rates. This bill offers a lot of good bipartisan steps. I hope we can continue to improve by continuing to work on proposals such as senator baldwin and smith and murkowskis important drug Price Transparency bill. To be clear if we are going to bring down cost this is no place to stop. Even if this bill offers relief on many issues the ministries and policy are undermining healthcare for tens of millions of people across the country. They rejected democrats efforts to defend for protection with people with preexisting conditions, coverage for nationwide from a partisan lawsuit that is moving through our ports. President trump is a lot Insurance Companies to go back to selling junk plans that lead people with preexisting conditions vulnerable. And refuse to take significant actions despite campaign promises. And he has lost investments in helping people navigate the Healthcare System and get the plan . To put a finer point on it, when your car is tooled you cannot fix the windshield and expect to start driving. We have a lot of work ahead and im glad we are here together on this legislation and we will keep making clear this will not be your last one. Democrats understand and i know families do as well. We have large work ahead of us. Thank you very much. Thank you, senator murray and before you came i said much the same thing there the healthcare is a big topic and theres a number of areas in which we disagree. In which we will continue to debate but one thing we have been able to do and i think senator murray and the Community Members for this in the staff, identifying nearly three dozen provisions about 16 republicans and 14 from democrats and we have a few more we are working on such as Cassidy Murphy provision on healthcare and another that senator murphy mention. He. I thank her for working in that way and complement both staff before she came. I only have five minutes, just like each senator does so i hope we can have an efficient backboard because i have two or three questions id like to ask. Mr. Kavanaugh, being a cms using the healthcare in a broad sens sense this legislation basically seems to me to do three things and surprise billing number one. The whole series of provisions aimed at transparency increasing transparency so beyond you know the theory you cant reduce the cost until you know the cost and the third thing is to you mentioned this yourself as a former regulator, weve got nine provisions to try to increase competition for generic and by similar drugs which are 90 of all drugs prescribed. If you look at those three areas surprise billing, transparency, increasing competition do you see those as meaningful steps and which one would be the most impact on reducing the cost of what will people pay out of their Health Pocket for healthcare. I dont see them is that different but when you have a surprise billings addressing the failure of the market where the consumer did not or is not in a position to be an informed consumer making choices they are in distress and going somewhere without full information conspiracy again is what makes markets work so people know what theyre doing so these are all to be procompetitive policies and thats why i applaud the community. If i had to quantify the magnitude title three the one specifically labeled pro competition about certain hospital negotiating tactics, i think that will have the most direct and immediate but theyre all growing in the same direction. Thank you. Let me ask you this. Transparency is a big theme he here. On the 340b program hospitals put on their websites where the money goes and 340b is a lot that says drug discounts should go to low income people so why shouldnt hospitals be required to report that same information, any problem with that transparency in your view . Mr. Chairman were all for transparency but we have a voluntary initiative among our members, 340b members all over 1100 have complied by putting out that information. Then why dont you take that information and give it to hearses i think our plan is by the end of the summer we will have all that information and give people time and it can become gated but we do intend on providing the names of the folks that light up and access to the data. From my point of view the Community Health nurse have to do that and let us know how the money but my own view is when we talk about transparency and the law says the money is to be spent for low income folks that we at least ought to see how it is spent. That doesnt mean we tell you how to spend it but at least we know how its spent. Let me go back to surprise billing for a minute. A lot of senators have worked on that and you spent time on it. Seems to me that if the problem is out of Network Doctors that the solution is to have in Network Doctors. That seems to me to be the simplest solution to the problem and also save the most money. All three of the proposals we put out take the patient out of it and there are no more surprise bills so the question is how do we reduce healthcare costs to most. The other two provisions are the . Type preventions which the house seemed to prefer and then arbitration. You talked about it your testimony but isnt arbitration really a sort of . I dont see much difference between the two. What are the problems with arbitration as opposed to a house . Proposal or the one i have instinctively liked the best which is make everybody in the network . Short answer to your question is theres not much difference in practice between an arbitration system and a . System. The reason is basically that if you think about what the arbiter is doing they have to make the same decision that the person choosing a . Will have to make. They got two offers in front of them and have to choose which one is more reasonable. Only way to do that is to know what the reasonable number is, which one is closer. When i look at that in terms of practice i think its very similar. There are some differences between those two options. Tends to be less transparent and tends to be more expensive and over the long term a number of experts have worried it might be less predicable. Generally speaking they are quite similar at their core. In your preference, number one is the in network guaranty. Number two you tell me your preferences. My ordering is the ordering you were going down. I like the in Network Matching specifically because late we solved this problem in every other markets. When you go get your car replaced you dont have to worry about it on inspected bill from the person who repainted the bumper. Its not because we have an arbitration system to litigate bumper bills but because we go with all in pricing in most markets and thats how we solve this issue. To me that seems the most natural my time is up. Thank you. Senator murray. Thank you. Senator alexander asked about the 340b program which requires pharmaceutical companies to provide discounts on crucial outpatient drugs for providers that serve low income high need patients. In other words, 340b is one of the most effective programs managing high drug costs we currently have. There arent any taxpayer funds and providing those discounts, correct drug company funds. Thats correct. So we can debate the best way to oversee this for but were not talking about wasting taxpayer dollars. Correct. Mr. Nichols, hospitals do a lot of reporting as part of their position in medicare and as part of their medicare cost reports. Do hospitals report on labor costs, Physical Plant expenses, marketing costs and other things . Yes, all the above. But medicare does not pay hospitals for those costs like marketing yes, some are unallowable police to report them. They supported the establishment of a medical loss ratio for health plans do the mo art require plans to report on their ministry to cost like marketing and executive compensation can. It absolutely does. Senator senators do have a bill requiring Drug Companies to report on those types of costs when they make price increases over 10 and you think thats helpful information connect. We think its critically important. Remember, these drugs are lifeanddeath for a lot of people. This information should be available to the public and policymakers. You would support that approach. One 100 . We also would encourage an examination of launch prices. Ms. Mitchell, many states, including my home state of washington, have passed the decision to enterprise medical bills. The Organization Works with large employers to bring down the cost of healthcare. Why is it important to your members for the federal government to act . We have multistate employers and often variations across the state that increases the challenge for them. We need federal legislation in this area. One of the issues that we are debating is what is the appropriate rate for an insurer to pay providers for a surprise bill. What impact do you think the proposals that we have in our discussion draft have on enrolling premiums and access to care . Ever experience in california is that has no effect on premiums. We believe that we can achieve very fair pricing at 125 of medicare and 25 of hospitals are under medicare rates and we think there are significant opportunities for business practice improvement and increased efficiency among hospitals and believe thats a fair rate and could be sustain sustained. Mr. Nichols, the bill that were talking about here today addresses a number of Public Health issues that are critical to conversations regarding healthcare costs. One issue of increasing concern that ive heard so much about is the rise in Maternal Mortality rates. I believe we have to do more to help reduce those preventable deaths in many of these deaths occur not during childbirth itself but during the weeks and months before or after childbirth. Can you tell us how hospitals are working with Community Partners to help make sure women have the information and the healthcare they need to avoid unnecessary illness or Death Associated with pregnancy . Yes, thank you. Two thirds of maternal deaths do not occur during childbirth in the hospital. Before or after as you know. We are working with Community Partners for part of a coalition thats been led by [inaudible] for many years to try to address that better. What your bill does provides more funding, more focused and the senate took action last year. Senator cap does bill and legislation in the house by representative kelly that we support and we need to do as much to solve this problem and ought to have a deadline where solve this problem nationally. Thank you very much. Mr. Nichols, and one other topic over 1000 cases of measles have been reported in the u. S. In 2019 and greatest number in nearly three decades or than 80 of those were in my home state of washington. Those operates could put families and communities at risk and put unnecessary strain on our healthcare and Public Health care system. I was overwhelmed by what i saw in park county where we found the majority of these in the costa took to the Public Health officials, community itself and all the reporting looking for people so im glad the bill were talking about that is in front of us includes provisions to combat misinformation and increase vaccination rates. How can Healthcare Facilities and providers in Public Health professionals Work Together to increase what we call vaccine consciousness . We are supportive of the provisions of your bill with the chairman and you go a long ways in that direction. We hear from our members increasingly about the Measles Outbreak and what its doing to the communities. And what its doing to their facilities. We need to together you put your finger on it. Its that misinformation out there is causing this problem that has to be fixed. Thank you. My time is up. Thank you, senator murray. Senator collins. Thank you, mr. Chairman. Ms. Mitchell, you have dedicated a substantial portion of your career toward promoting more transparency in healthcare pricing, as well as higher quality. As a result, its one of the best states where you have all Payer Claims Database and i have joined senators rick scott and gardner introducing a bill that would create a consumer friendly database for Prescription Drug prices. In your written testimony you talked about two powerful examples of an employer who was overpaying for Prescription Drugs and one was the kidney patient where the employer was 138,000 every two weeks and now it looks like it will go down to 26000 and the other was a pediatric patient where the cost for the employer was 750,000 and now using a different hospital that cost may be only a third of that amount. What led to those excess stori stories . Was it Greater Transparency was someone negotiating for the employer . What produced those kinds of results . Thank you, senator collins. Those are important examples of both the problems in the system and also the opportunities to fix them. These cases could not have been addressed without transparent pricing information. Only these very large employers can have access to that information oftentimes. We believe with Greater Transparency more actors and employers and insurers would identify Solutions Like this and i wanted to point out that particularly in the case of the pediatric patient those annual cost of 750,000 were brought down to 250,000 a year, same drug and administered at home at the request of the family so this was a winwin for the employer and patient. We believe transparency would enable more Success Stories like that. Thank you. Mr. Nickles, some of the rural hospitals in maine are worried about increased transparency because their prices because of the smaller Patient Population that they are serving ten to be higher than their urban counterparts. Those rural hospitals are really important to communities and allow people to live where they can get care. How do we balance the need to maintain Rural Infrastructure for healthcare and the need to lower prices which is imperative . You are absolutely right. We need to be mindful of the impact of any of these policies on Rural America and the unintended conferences that these policies could have. For example, ratesetting which has been discussed because hospitals yes, costs are higher margins are smaller and more difficult time getting staff positions, nurses et cetera and we cant have a National Rate imposed on them that would be basically a race to the bottom. Whatever we do here ending surprise bills i think everyone agrees on that and there are the provisions in the bill do that but there are other provisions in the bill like ratesetting that worry us a lot because of the impact on rurals. Ms. Mitchell, let me return to you for my final question. Biologics are one of the categories of drugs that are most expensive. The aging committee which i chair has had a number of hearings on this issue and what we found is that the brand name manufacturer often puts up [inaudible] the prevents bio similar from coming to the market. By contrast, the bio similar uptake in europe is much more prevalent than in the United States. The former fda commissioner Scott Gottlieb is estimated that of all the bio similar to that event approved by fda actually made it to market in a timely fashion and the American Consumers would save more than 4. 5 billion. Do you have any thoughts and do you support the provisions in our bill that attempts to prevent the gaming of the system to delay the advent of bio similar to the marketplace . Absolutely. We strongly support any change that will enable increased access to bio similars and anything that prevents we believe there needs to be strong action on drug pricing and we strongly support the provision. Thank you. Thank you, senator collins. Thank you, mr. Chairman. Ranking member murray thank you for your work to address rising healthcare costs. I also want to give your special thank you to your staff. These are complex issues and stakeholders and therefore income for your staff and they been terrific. Americans have called on congress to act and i applaud members of this committee and both sides of the aisle for taking these calls seriously. Im particularly encouraged by the momentum behind our work to end the observed practice the price medical bills. People get Health Insurance precisely so they wont be surprised by healthcare bills. It is completely unacceptable the people to everything theyre supposed to do to ensure their care is in their Interest Network and still end up with large unexcited bills from an out of network provider. As has been mentioned, ive been working with senator cassidy, murkowski and others to address this issue in a bipartisan way and we worked for over a year now on this issue and received and incorporated feedback for many of you on this panel. Im grateful for your testimony and this hearing is an important step forward as he worked to protect consumers and enterprise medical billing. Mr. Kavanaugh, i like to start with a question to you. My colleagues and i and our Bipartisan Group agree that patients must removed from the price billing disputes. It has become clear that there is no . Payment rate the plans and providers can agree would be an appropriate one onesizefitsall approach. During your time at the msu experienced firsthand how difficult it is to set your form payment rate the work while throughout the country. Can you briefly touch on why that work was so challenging . Sure. Senator, if you think about the Medicare Advantage which is an analogy. Medicare advantage if you go out of network there is limits on balance knowing theres a set rate that the provider will be paid because its the highly related system. That is built on anonymous in the structure with the Medicare Service provider that takes thousands of employees in baltimore working every day so theres an structure has been refined over time. It is built on something and if you were to go the . Route in the legislation i should preface this with saying we support all three approaches because youre protecting the consumer we dont have a preference for it after that but i do think in the legislation tries to anticipate you will run into as you try to a . Rate is ratesetting of a sort and will run into unanticipated conferences. Someone will need to figure out how to adjudicate all those situations and make sure because youre not building on the medicare federal which as a whole agency. And briefly, is it fair to say that even when you do establish a . Or a rate it is hard to maintain that as an applicable rate across the country for all providers . I think what youre getting at is i do think theres a disputed consequence is that will if you decide to go that way that we would all learn it will take more work than any of us can anticipate. But it is an approach. Thank you. Mr. Nickles, we have heard a lot of disagreement throughout this process on how to best create a payment resolution that works for all parties. Yes or no, based on your experience to believe theres a . Rate that you and your colleagues in the provider and Payer Community could agree to which congress could then legislate into federal law and apply across the country. We do not. Given the lack of consensus around what the correct . Payment rate would look like it seems unwise to me for congress to legislate an impossible . , especially when we know if we get it wrong it would take another act of congress to an do it. Do you believe in independent dispute resolution frameworks similar to whats already in place or in law in 12 states would be workable for hospitals, providers and payers and why or why not . As i mentioned, of the three options of the bill that most preferable option. We prefer to continue to negotiate with our insurance colleagues for bills and would like to do that. Particularly for positions and rural physicians going back to senator collins question that the dispute resolution system much like in new york state disproved effective, efficient et cetera would be the best option in the bill. Thank you very much. I yield the remainder of my time. Thank you, senator hassan. Senator cassidy i like much of your testimony and by the way, i almost read an article about you and said be still my heart. Which is what you say in montana. [laughter] i dont know your status and i married to my wife but [laughter] with that said, to stories. My daughter got kicked off of alice in wonderland in central park and took her to the emergency room and shes bleeding from her for head. Yours that we dont have a plastic guy go to his office. He went to his office and i got a bill for 3000 for glue the guy put in and took it five seconds to place. I was at tennis match here in dc and all of a sudden i get this black spot and call it ophthalmologist and says you have a retinal tear go to the er right away. I go to the er anything you dont need an er look you up with the ophthalmologist and go see him tomorrow morning. Both emergencies. In that case i think i got a bill for 1500. Both out of network. Does Network Matching helped me in either of those situations in which i was not seen in the hospital but rather referred to the Physicians Office . In a very good question. The Internet Network guarantee would take care of a very large portion of the surprise bill but they are the ones that occur at your in network facility. On the other hand what msi do gather that under the proposals she and i have i would have been cared for in both situations in which there would have been an in Network Price and so there would have been an out of network disputes but i would not have paid 3000 for 20 seconds worth of glue or 1500 worth it because i got my retinal detached or reattachment but it was out of network. I want to say there is a superiority and we are naive if we dont think that there would be more migration all of the in Network Hospital into a savings not covered by an in network rate if we are to put restrictions upon that what a position can bill. We would be naive to other i think. I would clarify one point, those in arbitration and . System would have covered you in that case. Arbitration and . But not in network. Executive in network would need in theory to be paired with something. You think i want to say about . Is that this is a ratio ms. Moody, hold that up, please ms. Moody calls herself than a white. If you see dark blue has the highest rate of care dark brown has the lowest rates its easier to get doctors in florida than it is to get doctors in alaska so therefore he must pay doctors in alaska more and market forces, if you will. I suspect even there are a great variation if youre am in miami you probably get more docs willing to get work and in rural area fewer but i will make the point that they have a . Would require a complexity that would reflect both different states as well as different areas with in estates. I do think that the complexity there. Its an important point and the reason why the . And the arbitration options included in the bill were talking about are based on the average in network rate in the area for the second point im not sure our . Is but im happy to circle back. The other thing i want to dispute is you mentioned in your testimony that you mentioned in your testimony or i should raise this. I want to make the point that [inaudible] laboratories of democracy have put in arbitration models and the tennessee orange for our chair are states which have the . But no state has eight network match so empirically i want to say theres i see Washington State either has uw purple or lsu purple, not sure what that is. I would clarify one thing. The data to indicate the most hospitals do not produce outofnetwork bills for in network patience which if we were napping that would suggest that in all 50 i accept that and thats the superiority of the dispute resolution but i have limited time so ill make one more point. Your testimony is suggest that the dispute resolution would be more expensive but i will point out that cbo scores the savings of the cassidy proposal as 70 billion and the network match is only 9 billion and so there is, it might be expensive but less expensive than Network Matching and ill probably hang for a second around it. But i will now out of time in your back. Thank you, senator cassidy. Senator smith. Thank you, chair alexander. Great to have you back and thank you Ranking Member murray. Theres been a great work. Dot and im grateful for you being here today to testify and answer some of our questions. I believe the number one thing i hear about from minnesotans across the board is rising healthcare costs and often they go down right away to the rising cost of option jugs. Im glad the proposal that we have before us includes good drug pricing provisions and im glad the bipartisan bill i worked on with senator cassidy the protecting acts to buy similar act is included which would help to bring down would help lower cost by assemblers into the market like insulin and the proposal of bills i worked on with senator roberts and the insuring innovation act would would present the ability of the companies to make minor tweaks in their formularies and extend their lucidity which again is an anti competitive strategy that benefits the Drug Companies and not consumers. I know your organization has done a lot of work on the issue of how to lower the cost of Prescription Drugs. I have first a general question but whats your feedback on a proposal we had in this bill and is there anything more you think or what else should we be doing. We very much support the proposals of the bill which are primarily transparent and thats important but its not nearly far enough strongly support your bill around patent abuses and first filers and also strongly support the notion that price is the problem and should not get confused and need to address drug pricing and need the government to get in there and the majority of americans, including publicans want the government in there to help fight for fair pricing. Exactly. Increased transparency is useful but that is not the only thing that will address lorraine drug pricing. I appreciate you missing the bill that i have the very first bill i introduced when i came to the senate which is it cracks down that would allow subsequent generic with a little technical but subsequent generic drug filers to share Market Exclusivity with first filers if they win that litigation. They dont have so it does something about the exclusivity away that is amenable to the Drug Companies. As you say, it will allow us to refocus the drug industry on innovation and not reward smart lawyers. Not that we have anything against smart lawyers but however i want to go to another issue i think is important and important to minnesota and its something that senator and i have been working on it has to do with all their claims database. This partly, it seems to me as if in montana you done a lot of work with us and this claims that database has been incredibly useful in minnesota to help us get a handle on what is happening with drug products like insulin and how much minnesotans are paid on average and how those prices have risen over time and it is given our department of health a very, very important tool for adjusting some of these issues. One of you that how important it is to look at this information on the regional level. The bill we have before us includes or does work to advance the work of all claims and i cant say this, all player claims database but ive heard some concerns from the Minnesota Department of health about how this actually would work in real time and what it might do or not do to help states get the information they need. So, i will ask mr. Alito this, you know a little bit about the Minnesota Department of health have had with this and how to respond to the concerns that they have raised specifically that the legislation before us is drafted not provide states with timely access to data they need as well as the federal government from selfinsured plans . There are multiple approaches of achieving effectively the single we think about all player claims databases. As we understand the bill and i could be misreading but i understand it as an effort to try to create a federal all their claims database for that regulated plans and also allow statements to coexist and combine their data with the federal data set. The one catch is i believe they have to share their data with the federal government and to the extent thats a Sticking Point im amenable to rethinking the exact structure but i do think at a defined they do or can coexist at least in theory. As im about to run out of time senator may have questions about this as well but i am very eager to resolve this issue so the great work that ms. Bartlett was talking about can proceed at the state level as well as at the federal level. Great, they keep it out of time. The chairman will be back in a few moments but it is absent i will continue. Senator brauns project thank you, Ranking Member murray. I wish we had more than five minutes and in such an important topic. As you can understand 14 proposals from the other side of the aisle with 16 from our side this is a big deal. Im approaching this as recently as ceo of company that brought healthcare issues into the cc to ten years ago and needs to be there and not probably in hr if were going to fix it. I want to give you history and what i did. I was not a member of group is large as ms. Mitchells in which i had been but i was simply frustrated to the main street entrepreneur that every year it was the same issue. Premiums kept rising and id get this smirk of your lucky is only going up five10 a year. I want to let the industry know as well as the American Public that we are with you there and its a crisis and i would challenge the industry that we should not need 14 proposals from one side of the aisle with 16 from the side to be fixing what is 80 of our gdp. If it was any other part of our gdp competition and transparency would have gotten rid of the whole mess through the process of works elsewhere when youve got it. Through that frustration hears what works for us. Im seeing being incorporated in these ideas that were talking about i figured out back then and we not talk much about the user and the consumer and employer but completely atrophied in terms of being involved in the market because its been so paternalistic. When the entrance comedy is basically saying part of this is the fact that people that use it never asked how much does it cost and dont want to be involved in it but i think that is important. I devised a plan that did for skin in the game and gave all the tools you could get including Health Savings account and basically emphasized wellness, not remediation, get everything in the kitchen sink basically cut cost out of the gateway at 50 and from my employees cover preexisting conditions and no caps on coverage which we need to do as conservatives and republicans as part of obamacare that just would not work due to its structure and we need to get with it. Im not had a premium increase now into the tenth year because i got my employees engaged in the time they entered the Healthcare System they at least see how much does it cost and look at their alternatives despite the industry not doing much to accommodate it. It can be done. We are running out of time. Employers are getting frustrated and most arent as passionate as i am or maybe the group in california and theres a clear alternative on the other side. I give this as warning to the industry and we ought to be fixing it yourself and not having us here and having the nice view of legislation that would not occur in any other sector of our economy. My question will be directed first of all excellent slate of witnesses. Maybe theres another round that we can get more in and i stay here to the last person standing. This will be for ms. Mitchell. In your group which looks like its got a lot of large employers and im sure a lot of what i said resonates where have you or what have you done to look at the other end of the equation and consumers drive most markets with full transparency and the desire to get the best choice of quality and price. Do you think the consumer, the employer is atrophied to wear if we do make it more transparent and we get the industry to ever get out of its doldrums will be have employee, consumers, patients be willing to have skin in the game and have helped the system out as well . Absolutely. I think patients and families absolutely have skin in the ga game. But they are in a completely untenable, unfair situation. There no information and were talking about providers not even being allowed to share information with them and the providers they trust and we asked them to be responsible consumers with no ability to do so with the cost information or relative quality so our members would be welcomed as an honorary member our members are trying any innovation approach they can to actually work with their employees to address their concerns. We absolutely believe transparency is necessary and we will have active involvement of patients. So, i devised a plan with dollar one and you do have skin in the game but then have to cost so where you never can go broke because he had a bad accident or got sick and it did work. Id love to share those details with you but i thank you are saying the same things that i am. We all four families along with education its the most important thing out there and ironically thats the other thing going up. The Industry Needs to really take this as a warning and challenge that we will get stuff across the finish line here and its only been at the flanks. Its not going to happen unless we go to the other plant which is medicare for all. Thats what basically the countries have done that we are at a moment in time where we can keep the best of what we got but its got to reform itself or else that will be the only alternative. Industry, wake up. Thank you. Thank you. Senator bowman. Thank you. I am certainly encouraged by the committees effort to address health costs and Critical Issues like surprise billy did. Im very frustrated that we have not begun to hold Drug Companies accountable for jacking up prices of existing medications. In the past five years prices of brandname drugs have increased ten times the rate of inflation putting lifesaving treatments out of reach for our too many families. Meanwhile, Drug Companies ceos are seen bigger paychecks and reports show the median drug company ceo pay increase by 39 in 2018 with some of the highest paid executives making 20 50 million a year. That is why i worked with colleagues on both sides of the aisle including senators braun, murkowski and smith on the fair drug pricing act to require basic transparency of Drug Companies when they increase prices of existing drugs. I really urged the committee to add our bipartisan bill for the lower healthcare costs measure that we will vote on in the near future. Drug companies spent 172 billion dollars in lobbying last year. They worked hard to defend and often distract from their pricing increases often by citing industries statistics that show large investments in developing new cures. We have numerous studies showing the opposite. One recent study found nearly 80 of every dollar spent by big Drug Companies goes to something other than research and development. Things like marketing or stock buybacks the market is clearly broken and taxpayers deserve to know what we are getting for our money. Why do we need to include the fair drug pricing act in this package to ensure systematic transparency for drug pricing increases . Why is it important for companies to report specific metrics, things Like Research and development expenditures, marketing and advertising expenditures and other items . Thank you very much for your question. We strongly support legislation that youve worked hard on believe its very important. As you point out this industry is currently broken and it is we are incentivizing smart legal tactics and not innovation and these drugs are lifesaving. At the very least these comedies should be able to justify like insurance plans do and hospitals do why theyre charging for the charging and what the increases are for. Thank you. To be clear this bipartisan bill complete asks companies to report more information on their pricing decisions to taxpayers and Innovative Companies who invest in resources in research and development should have the opportunity to demonstrate the value of their investment to the public. This bill would do nothing to prevent a manufacturer from increasing prices. Mr. Mitchell, mr. S ossie, can you explain how more data on or ms. Mitchell, im sorry. Can you discuss for data on drug pricing decisions and managers will help policymakers researchers and other Industries Stakeholders make Better Healthcare decisions . This information is critically important. What we know is, for example, most of the drug line has dried up. They are converted to generic drugs. These drugs have huge price spikes have the least amount of competition and not necessarily most effective drugs. We should have transparent information about exactly why the prices are going up and we should take even further why this is real innovation of adding to the market families but without that information with happening right now is talk of these are making more and more money not because they are saving lives, not because of because of the art extorting markets. I would agree but the problem is the pricing and everything were talking about with rebates and that is obscuring the actual issue which is the pricing. Our members are trying to offer discounts and their basing those on estimates because they cant get insight into the price of the drugs. We absolutely need transparency but it just the starting point. Thank you. My time is expired. Thank you, Ranking Member murray. I preceded the members who came together to inform us on this most critical issue for the American Family. I very much size with the comments made by senator baldw baldwin, Prescription Drugs is an area of important focus for this committee and an area where opportunity is apparent for us to help the american consumer. One of the things that we have worked on as a measure to help in this regard is to assure that individuals who are responsible for coinsurance for their Prescription Drugs at the coinsurance rate is determined upon the net price, not the retail price of the drug so that when rebates or the like have been provided that the consumer has the advantage of that feature and hope that becomes part of the final bill. Most of the discussion today is focused on different points of view with regard to surprise billy and i want to prefer to focus on an area. Mr. Kavanaugh, you indicated that one of the challenges with benchmarking is that you have a huge number of people responsible for people sitting medicare rates but something of that nature does not exist if we put it in place and ms. Mitchell indicated that she would set the . Based upon the medicare rates so with that not remove the convocation that your concern about which is to simply set a . Rate and do it based upon either one. 25 times the medicare rate were 1. 5 times or equal to basically use that as the . Figure in with that remove that complexity or concert . Sure. Thank you, senator. The point of trying to make is that Medicare Advantage theres a migrate that operates this way but is publicly known and i can go online and tell you today with the . Rate is in every community for every service. This legislation is one of the options which would create a new . Rate with different methodology and someone will have to go and build that figure out what those rates are. I did not mean to make a bigger point than that. Thank you. Ms. Mitchell, any comment . Again, we think this is the most straightforward, efficient, transparent way to come up with their rates and the evidence supports that. Would anyone want to comment on the advantage or disadvantage of using that system which is if you could use a . Using the medicare . And enough that as opposed to an arbitration process. Im concerned that with an arbitration process it will be highly complex with after the facts of negotiations going on and differences in different communities and arbitrators that may or may not be familiar with the specific circumstances and what it be a lot easier to just tie into the medicare rate one way or the other . But if people have different views mr. Nickles, please. Thank you, senator. I would have a different view. Our concern is, first of all, well documented in congresses Advisory Board says the medicare does not pay the cost for hospitals that are fair. To base anything on the medicare rates this is a mistake and secondly there is no difference between that and medicare for all which was just described earlier which we have real concerns about. The third thing i was a is one of our concerns about setting a rate is if its out there what we want is for negotiation to be between providers and insurers. If theres a fault rates, while the insurgents always go to the default rate. There will be a negotiation the one in Front Networks and i think were coming back to the same thing as medicare for all. I like to follow up, if i can send a. To be clear, again when were going through an arbitration process for using the . You got to decide who wins and who loses and ultimately were doing the same thing. I would push back and simply say if you think medicare is too low and thats completely fine with me then it doesnt mean you cant use medicare at least as a concept but you could say medicare times two or three or whatever number you think is appropriate. One advantage that has is it isolates it from being gamed by the market actors that is trying to engage in these shenanigans to be in and out of network for the . Rate and as a function of that. Ms. Mitchell. I concur. I would also point out that 25 of u. S. Hospitals manage their cost well enough that they are successful under medicare rates and are not talking yet about cost. The recent report shows hospitals build commercial payers and employers an average of 240 of medicare. What is the actual cost to provide that care and how do we agree on a common standard . We believe 125 is there. Thank you very much. Mr. Chairman. Thank you, senator. Senator casey. I want to thank you and the Ranking Member for the work youve done and for being here. Ive been in and out so i wanted to raise something i dont you are aware of. We are trying to get done and this is the reform in the fdas authority to regulate over the counter drugs. All of us have an interest in making sure that any Prescription Drug is safe and effective according to the most uptodate Information Available and this islegislation that senr several years. Isaacson and i have worked on for many years now, at least we are hoping we can get it done. Mr. Chairman, for the record, i wanted to ask you to commit to pushing ahead and finding a way to pass this legislation, socalled overthecounter monogram legislation. You know that i think its very important and would like to find a way to pass it so thank you for the question. I appreciate that and im glad that on the record. Not that it was essential but were grateful for that work and trying to move it forward. I want to move to a question about some developments that have played out over several years now but something even more alarming that just arose in the last couple of weeks. We know this committee is engaged in a process to try to bring down the cost of healthcare as well as the cost of Prescription Drugs. While that has happened to things i think are undermining those efforts. One is what can only be described as sabotaged by the administration. Sabotaging the Healthcare System with regard to what happens on the exchanges as well as in regard to medicaid itself. I wont dwell on that today. We do know from data just released earlier this year that 7 million fewer people have healthcare and theres a good article that describes this data that gallup found and heres the name of the article dated january 23, 2019 by sarah cliff and republication box. A trump the number of uninsured americans has gone up by 7 million and thats the title of the article. This problem is now compounded by what the administrations undertaken with regard to the official poverty measure. We know that if this proposal is adopted and the official poverty measures tied to socalled chained cpi reading from a letter i drafted signed on by or cosigned by 42 senators quote because chained cpi shows lower inflation over time then fewer americans will fall below the poverty line. Heres what it affects health and Human Services bases its annual poverty guidelines on the official poverty measure thresholds. That will affect medicaid, children Health Insurance program, paternal child health black and head start, School Breakfast programs, on and on and on. This is letter that we sent to the administration to reconsider this proposal. I ask all of that and i want to direct this question to mr. Asahi to see if what your viewers on that in terms of what i would call Underlying Forces with regard to what were trying to do here with regard regarding healthcare costs. First and foremost, usa is incredibly proud of the work of this bipartisan passion to build a solution that will address the healthcare costs but we have to get we have to be clear but American Families want to be healthy and if they get sick get care and not go bankrupt. Efforts to undermine the ability of families to get real, meaningful coverage is not that goal. We are deeply concerned and have seen hundreds of thousands of peoples coverage as you point out in particular one the most troubling things is the fact that weve seen over 30000 children lose coverage. Thats totally acceptable. In terms of chained cpi were very concerned about this and now there are more than half a million americans because of this and access to other programs you are describing over half of this will be children this committee is focused on the notion that families want security and their healthcare costs will not bankrupt them should pull in that same direction. You very much. Thank you, senator casey. Senator murkowski. Thank you. I apologize i was not here to hear your testimony and had the opportunity to read it and i appreciate it that you are all in in this important discussion. My colleagues here on the committee know that every time i ask questions when it comes to healthcare is always to the length of what is the effect on our rural areas in areas in my state that are beyond rural and so i look at all of this through the perspective of one who says we dont want anti competitive provisions but if i only have one hospital or only have one clinic or one provider how does this work . I want to start with you, mr. Kavanaugh. You spoke to the potential impact of the transparency and anticompetitive provisions on Rural Health Providers and when we are looking at the various proposals that we have in front of us as ways to reduce the cost i am curious to know whether your review has included situations where you have community with both a single hospital or single prominent insurer who has the most negotiating power there. How do you determine an in network rate in an area where you dont have in Network Providers connect when we talk about similar geographic areas and a lot of my communities and in 80 of the communities and the states were not connected by the kind of road how to me to find this so you have looked at this to the regulators perspective and one was looking at the Broader Market at a whole so do you think its possible for us at the National Level to adopt a standard payment methodology that can account for this wide discrepancy and just differences . Thank you for the customer it let me preface it by saying two things. In the context of spitefully all three approaches are equal in that first and foremost we protect the consumer. From the perspective it represents independent positions and they are not the ones in surprise billy. I applaud that and thats the first order of business protecting the consumer and they do that. After that as i think point out its a dispute between insurers and providers and becomes particularly problematic where either Provider Committee is consolidated for we are equally concerned when the Insurance Committee is consolidated. Some of the approaches i think are stronger in a competitive market meaning the approach to use in network guaranty makes a lot of sense when you have multiple providers and shirt insurers cashing it out and might become more difficult as you said any Real Committee where its all one provider. I worry that again we have tried to do one side fits all because the most convenient for us back in washington dc and we want some kind of standard but i remain concerned that in certain places is not possible. Let me turn to you that in your written testimony you provided a couple different options when youre talking about in order to stay at open hospitals need to ensure adequate staffing two ways. One option is to talk up the payment rates and another is to ensure their willing to work. The other option is to demand insurers guarantee reasonable market rates to doctors. When you say in order to stay open hospitals need to ensure adequate staffing that last year or im sorry, last week in tennessee the 107 rural hospital in the country closed in 2010 and we are going the wrong way here in terms of encouraging our rural hospitals to keep their doors open. How do you line up your statement there with adequate staffing . Theres a basic economic challenges that face rural the dont base urban hospitals. Its a challenge that exists outside of the surprise billing specific scenario. Fair enough but when were talking about surprise billing how does maybe i should caveat that comments by saying conditional on this being a sufficiently robust that a hospital can stay open then i dont see that a particular solution for surprise billing are going to be fundamentally problematic however, if there is a concern over a higher level decline in the profitability or even ability to exist of rural hospitals then i hear the concern and think simply the solution to that is probably not found anything related to surprise billing but something more directly at those rural hospitals spirit mr. Chairman, my time is expired but i have a lot more questions and ill stick around to listen to others. Thank you. Thank you, senator murkowski. Senator rosen. Welcome back, mr. Chairman. Thank you to you and senator murray for working together in this important package and for all you being here today i will give a special shout out to the university of nevada graduate. Thank you. I appreciate that. I want to add to senator murkowskis rural concerns. Health care is one of the top issues and al gore in nevada like alaska is underserved. And so this is critical to us. Its currently drafted anybody here can chime in, the funds that are authorized can be used for telemedicine equipment, training and program evaluation. I i have kind of a twopart question. What else to think is affected to get a program Telemedicine Program up and running . What you think the minimum time stamp would be reasonable for Telemedicine Program especially once we get some templates done . The point youre making is incredibly important. I spent a lot of time working and Rural Health Care issues. As you point out what we need in Group America are truth disruptions that allow for health care to be delivered in high quality settings that are not the old Business Model of the hospital with four walls thats very expensive. This is a good example. As the chairman mention project echo is a phenomenal example of a program that allows, in this case is stored in new mexico. Focusing in very rural parts in new mexico to get Better Health care than they were getting in the hepatitis clinic in albuquerque. Because it does a few things. One, it trains are provided in those communities to an evidencebased standard of care. It allows providers are really challenging patients talk to each other and learn. Those are critical elements and i think as you point out turnkey Something Like project echo about this country is an incredible example of how we can get highquality health care to Rural America. Do you think creating templates we can export around the country would be a good working model . Absolutely. Mississippi, this wonderful telemedicine advancements have in mississippi. If i may, senator collins graciously shared i am from maine. Much of may is also front you and it would close with many world hospitals in the state. We are very sensitive to the pressures on this hospitals. They are very real and we hear Hospital Physician executive safety have to charge inflated prices to subsidize the care that we are not appropriate paying for like Maternity Care or primary care. I agree we need to look at direct ways to subsidize of that care and we need to be thinking about rural patients instead of just rural hospitals. I also was extremely encouraged in my time on the physician focused technical advisory committee. There were innovative proposals by constant at home that were supported by physicians. New ways to deliver care to rule patients that needed hospital treatment. Telemedicine, hospital at home, these innovations are essential to bringing care to those communities. This is this is a great, thee great things. How can we consolidate or find any, placed these kinds the template that other places across america can see the challenges they have made in a particular disease or area that they want to improve upon . How do you suggest we can put these good examples and export them to other communities across the country . Thank you saturday. Fortunately this congress has answered that question by creating the Innovation Center at cms. There are demonstrations underway, specific to rural hospitals. What is in pennsylvania and other imperiled. Its a global budget for all hospitals but it really started with global budgets for rural hospitals, the notion being dont make these rural hospitals depend on inpatient admissions. Free a post on they can do all those things ms. Mitchell minchin. That should be the platform. These are publicly funded. There with the public evaluations. They will be dissemination of the ranks. We need to get these lessons and models out to the rest of the country. What ways can we through this bill or others help you potentiate whats happening across this country and export that . What do you need from us . The innovations that has all the tools thanks to this congress. Continue to support them but its always put pressure on them. Go faster, better, and be more public. I would say one thing we cant lose sight of the is, and its exciting because for all of us, those who dont live in Rural America, these innovations will be available to us. This is but deed creating interesting disruptions. Scope of practice is something we all have to get handle of. Senator murkowski date has been a real leader in thinking about new ways for service be provided by new providers. Scope of practice is important, and senator murray was involved in crating a National Workforce commission. That commission needs to be founded. We need to understand the dollar slipped into workforce and what opportunities actually pick right now were told misalignment between the federal dollars towards workforce and the needs of our communities. Iq. I i think my time is expired, bt thank you. Thank you, senator rosen. Senator kaine. Thank you, mr. Chairman comic book back. Glad you have mr. And appreciate the work of the chair and ranking in getting our package in a good place where hopefully we can move forward with it. Since the discussion just recently happened about rural hospitals, i want to follow senator murkowski and look at it a different way. A testimony mr. Nickels, your testimony since 2010, 107 rural hospitals have closed, ten this year, one last night in tennessee. I was not aware of that and sorry to hear it. We had to back hospitals in virginia. One in Patrick County and one in lee county. There had been heartbreaking stories about the effect of rural hospital closures to i read one recently in the New York Times you with a hospital in southeastern kansas where i grew up. Another Washington Post article did with the closure of the hospital in oklahoma. Theres a solution, not a magic one item solution, but there is a solution for many of these communities. 93 of the 107 hospitals that a a close in Rural America since 2010 are in states that if not accepted Medicaid Expansion. The two hospitals in virginia that closed, virginia has been accepted Medicaid Expansion but the hospitals that closed, close years before the state accepted Medicaid Expansion and they said to our legislature, if you would accept Medicaid Expansion we can keep the hospital open. Now that virginia has been Medicaid Expansion, at least one of the hospitals is exploring can there be open . Its a lot harder to reopen a hospital and keep it open but nevertheless, theres a possibility. When we have these discussions about rural health, that is a statistically very significant set of data, 93 of 107 hospitals hundred seven hospitals that of closed since 2010, in this country come have closed in states that did not every Medicaid Expansion or hospitals dont like medicaid reimbursement rates and elect le medicare reimbursement rates a little better but not much, but the difference between a medicaid reimbursement rate and charity care for which are not compensated is a significant factor in the bottom line of a hospital. Im going to have you speak to this, mr. Nickels. Theres some things we can do in this bill and we should. There are some things state legislatures have been able to do since the Supreme Court rendered the ruling about it being a state option a Medicaid Expansion. When i read articles and people are decrying that their community is losing a Health Care Resource and people are losing access to care that theyve had in the community for their entire life and they have it within their capacity not to solve every financial woe on a balance sheet, but you dramatically affect with a hospital can stay open or not, and yet they are choosing to not embrace medicaid. They are basically consigning their world hospitals to situation where it is very likely will continue to close. I hope when message that we might deliver from this committee come from congress, and im glad my state eventually got this message is that theres no glory to be the last one, the caboose. Would make it past the 1965 it was an option not a mandate. Interesting, elastic embrace medicaid, 1982, arizona. They were 17 years after the majority of states before the final embrace medicaid. When the Affordable Care act past and there was now a Medicaid Expansion option, where did arizona fit . They were one of the first in, with two republican houses, with the republican governor. What do realize is what do they get by being the caboose on medicaid . What did they get by waiting for 17 years . What they got whats worse health care for hundreds of thousands of people over 17 years. They were not going to be the caboose the second tiger we have now had 35 states have done expansion. Dont compete to be the caboose. If you want to rural hospitals to be, have a fighting chance of thing a lot, or other things that have to happen Medicaid Expansion will keep these pillars of Rural Health Care from closing in many, many instances. Mr. Nickels, you wanted to comment on this . Yap. Totally agree. Theres a crisis in role america a crisis with rural hospitals and no question from our members, the went to feeling if the votes are in nonexpansion states. Our members work in the states to convince legislatures and theyve been successful in sum, virginia was one. They take the lead and try to get Medicaid Expansion but theres no question when you look at the issue thats probably the number one concern. That doesnt mean things like broadband are not important. That doesnt mean the telemedicine provision in this bill is important but a lot has to be done. They see my example is an excellent example. You are role models we should experiment with. The important thing is people need to have coverage. Thank you. Thank you, mr. Chair. Thank you, senator kaine. Weve completed our round of questioning and we have a boat at noon. I think senator murkowski and senator braun may have question to what aspect senator murkowski . Thank you, mr. Chairman. I dont know whether the issue has come up previously in the round of questioning, but when we look at some of the surprises that come in, and alaska is a very high cost stick. I mentioned 80 of her communities are not connected by road. How do we get to the hospital . We fly. The air ambulance, medevac, and it is not unusual for a medevac to be between 50,000 100,000. Some alaskans have more and more are seeking interested i would ask this question to you, ms. Bartlett. You are from montana . Thats correct. Okay. So youve got big open space out there, former state plan administrator. Have you made any progress within your state to address their english costs within the health plans there . I know this is not part of what were dealing with, but again as were talking up the cost drivers and trying to understand if there are some areas where we have seen some headway. Thank you, senator murkowski. Within the state Employee Health plan, we set reimbursement at 250 of medicare and thats what we take. Whether you are in network outofnetwork. At the same time i served on an interim committee to deal with this issue, and the result of that committee was legislation that did pass within montana that was, requires initial payment to either be the normal in Network Payment that would be made, the billed amount, or a negotiated amount. Because that allows for the member to be held harmless. At that point the member is held harmless. And then it the other party, whether it be the air ambulance or the Insurance Company, believes that its not a fair amount, then it goes to arbitration and arbitration oversight is the commission of interest. Thats been working well within montana . It absolutely is working well. Well. Within the state health plan we immediately saw all of the outofnetwork air Ambulance Company network except for one, at that particular air ambulance has a surface has closed a couple of their areas, but they were not in rural places. We have seen, we have not had lost care at all. Thank you for that. Mr. Nickels, i wanted to just extend the question that i directed to mr. Cavanaugh earlier about the differences within regions, the variations in rural markets. A benchmark payment rates based on average negotiated rates for region in my view appears to be most simple, most predictable framework. But do you believe that a benchmark rate based on negotiated rates within the region adequately account for those variations that we see within the World Markets . And can you speak more broadly to the impact of such a model where you have few providers and few insurers . Yeah. As you know we do not support that sort of approach, and would you believe that and addressed mr. Senator collins and senator cassidy with you here. If you set a National Rate it will not acknowledge local conditions do not acknowledge a place like alaska. We fear the heart of what the most, and senator collins mentioned this, is to Rural America where prices are higher, margins are small and the danger of something going wrong here is far greater than it is elsewhere. There are some untested ideas being discussed here, and we need to make sure whatever we do does the harm to Rural America. Thats why we think that, get the patient out of the middle of this. We all agree with that. I dont think theres any disagreement. We think of the approaches the committee has talked about that arbitration is the best one. Anything with the benchmark rate, however its described or defined the create i think a significant problem for Rural America. I like to clarify one thing very quickly if i could. The arbitration system and the benchmark system included in the health bill both reference the local and network rate as the benchmark rate. When we think about and arbitration system and think about a benchmark rate, are both based at the guidance to an arbiter would be based on the same think that the benchmark would become witches a local rate. I do think thats was emphasizing. Im going to ask mr. Nickels and ms. Bartlett very quickly, sounds like a rebuttal. A question that answered only from senator hassan. Thats what we dont like that rate thats in that bill as a relates to having a benchmark. We think there should be no benchmark. Each of the arbitration and negotiation between two parties. Thats what we think thats the better approach. Senator murkowski cup if i may at one thing within montana from this legislation was passed in the twentysomething session and it had been no cases go to arbitration. Okay. Thank you. ,. Senator murray, any questions . Bill, mr. Chairman. I just want to thank all of our witnesses from here, all your help and input. Senator kaine . Make it very quick. One for mr. Nickels and one for ms. Mitchell. David riggs, chairman of the board of eli lilly, just came out publicly that he wants to get rid of pbm rebates, wants them to go directly to the pharmacy and the individual. I applaud him for sticking his neck out as a major individual in the health care industry. American hospital association, my local hospital embraced, i think they call it care like a Something Better still the charge master been published in its inscrutable form where you couldnt understand it with the American Hospital association be willing to publish and understandable form charge masters across all hospitals, and the talking to a lot of people that really know what makes the Current System not work, would you be willing to expose thirdparty arrangements between providers and Health Insurance companies . Which so many people told me if it ever happened, it would break the system and you would cascade into transparency and competition. I know thats a load, but give me your quick comment on it, please. I hope i can remember all that. Charge master first. Charge master is a daunting experience. Sean can probably speak to from semester with work with cms to publicize more the charge master but i agree with you i dont think that the data people need. Something because people prices to the degree we can do it, to the degree we can make that simple enough for people to understand, i think thats the way we should go. We would definitely its mandatory you find how to do. What about the thirdparty agreements between providers and Insurance Companies . That we would disagree with. I figured you would. I just wanted on im certainly predictable. We phrase concerns. I know the administration has discussed about. The ability for two parties to a private contractual negotiations support. Even the federal trade commission which has never been the biggest speedy and a robust competitive market i would agree with you and a broken system like you want to get with the ms. Mitchell, what do you think . You been wrestling with this kind of stuff. Use the industry a special hospitals, 30 of of health care bill, you know, and resisting right there intends what they think . Isnt any chance the industry will start coming around to where we dont have to legislate them into action . One can hope. I would say that if the secret negotiations between providers and plans worked, we would not be sitting here. Everyone in america deserves insight and information about their medical care, equality, the outcomes and the cost. We are all in this together. We all have skin indicator we need a system that is responsive to the American People that required ambersons transparency and accountability. Agree 100 . Thank you. One question, ms. Mitchell, then, then we will wrap up. The bill that senator murray and i propose requires pharmacy benefit managers to give employers information on the rebates in the system so employers understand what theyre paying for. So if a pharmacy benefit manager negotiated a a 400 discount, d lets say 600 insulin price, the employer would know that instead of 600, the price is 200. How will we know that the employer will pass that 400 discount on to the patient who has diabetes . I think its an important question, and many of our members are doing this now. They are offering and extending the rebates to their employees, but as i said earlier, they dont have the actual cost and price information. They are using the estimates. The problems with spread pricing and rebates off wildly inflated prices make this more complex and convoluted. They are looking for ways to decrease these cost for the employees, and transparent clear pricing is part of that. Thank you very much. I want to thank our six witnesses. I want to think this hundreds, especially senator murray at our staffs. This is the way the turn sin is supposed to work. What weve done is taken in with theres plenty of room for lots of contentious discussion, and we havent here, the area of health care, and we set at least we can see if we can identify some ways to reduce Health Care Costs that people pay for out of their own pockets we talked about the price medical billing. We talked about transparency. There are a number of provisions in the bill that you had said increased transparency. And there are a number of provisions in the bill that increase competition for biosimilars and generic drugs which are 90 of prescriptions. Senator murray said thats her steps in the right direction. I hope our committee can move ahead next week to vote on this. We call it marking it up. Getting it to senator mcconnell, senator schumer essay lets put on the floor and lets turn it into an law. We appreciate that the real processes has been through 16 hearings, hundreds of comments from people who are affected. Was told a few thinks things wo work out but we wind up with about three dozen proposals from an equal number of democrats and republicans. Were on a good track doing what the American People expect us to do. The hearing record will remain open for five days. Members may submit Additional Information for the record within that time if they would like. Thank you for being here. The committee will stand adjourned. I have long glasses on. Within ten days. Good catch. The committee will stand adjourned. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] congress is on its summer break and many members are in the home states traveling to meet with constituents. Alaska senator Lisa Murkowski was in nome, alaska, meeting with rep sitters graphite is used to make ice auger scum chainsaws and vacuums your congresswoman debbie lesko is back from about person delegation visit to israel and she took tweeted pictures of tn dome missiledefense system which protects the israeli people from rocket attacks to discuss the u. S. Israel defense alliance. Oklahoma senator James Lankford met with representatives from nonprofits across oklahoma and discussed Charitable Giving in a bipartisan lift for Charities Act with senator chris coons. It would repeal section of the twentysomething tax code that requires nonprofits and churches to pay federal taxes and play benefits like parking spots. Congress returns on september 9. Tonight on the communicators, Daniel Castro Vice President at the Information Technology and Innovation Foundation on data privacy and if enough is being done to protect americans from harm. One thing we could do is we could make it so that its illegal to use Social Security numbers for identification and verification purposes outside of Social Security. This is something the Social Security numbers were never intended to do. For a long front it even says on the card this is not for identification purpose. They stopped printing that. That something that could be done, something that could be requirement that no bank could open an account using a social scooting number. You have to prove your identity to other means. Watch the communicators tonight at eight eastern on cspan2. Weeknights this month were featuring booktv programs showcasing whats available every weekend on cspan2. The first africans to land in english north america would arrive. 1619, and that would begin an amazing experience in the development of the United States. Saturday a special American History Tv Washington journal feature as we look back to the first arrival of africans to america, 400 years ago. At Point Comfort distort fort monroe virginia. The history of africans in america from fort monroe Live Saturday begin at 8 30 a. M. On cspans washington journal and on American History tv on cspan3. In 1979 a Small Network with an unusual name rolled out a big idea. Let u. S. Make up their own minds. Minds. Cspan open the doors washington policymaking for all to see bring your unfiltered content from congress and beyond. Ally this change in 40 years by today that big idea is more relevant than ever. On television and online cspan is your unfiltered view of government so you can make up your own mind. Brought to you as as a Public Service by your cable or satellite provider. A look at the united kingdoms relationship with the u. S. Elizabeth truss, british secretary of state for international trade, talks or economic trade opportunities for the two nations. Are remarks at Heritage Foundation in washington, d. C. Are about 15 minutes 50 minutes. Good morning, everybody. Its fantastic to be at the Heritage Foundation today. An organization which gave impetus to the Reagan Administration in the 1980s, unleashing an opportunity and is now very much at the forefront of republican thinking as you move into the next decade. Theres a reason why m