    [Senate Hearing 115-849]
    [From the U.S. Government Publishing Office]

                                                          S. Hrg. 115-849

                         HEALTH CARE IN RURAL AMERICA:
                        EXAMINING EXPERIENCES AND COSTS

    =======================================================================

                                    HEARING

                                   BEFORE THE

             SUBCOMMITTEE ON PRIMARY HEALTH AND RETIREMENT SECURITY

                                     OF THE

                        COMMITTEE ON HEALTH, EDUCATION,
                              LABOR, AND PENSIONS

                              UNITED STATES SENATE

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 SECOND SESSION

                                       ON

      EXAMINING HEALTH CARE IN RURAL AMERICA, FOCUSING ON EXPERIENCES AND
                                     COSTS

                                   __________

                               SEPTEMBER 25, 2018

                                   __________

     Printed for the use of the Committee on Health, Education, Labor, and
                                    Pensions

    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

            Available via the World Wide Web: http://www.govinfo.gov

                                  __________

                        U.S. GOVERNMENT PUBLISHING OFFICE
    32-296 PDF                  WASHINGTON : 2020

    --------------------------------------------------------------------------------------

              COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                      LAMAR ALEXANDER, Tennessee, Chairman
    MICHAEL B. ENZI, Wyoming		PATTY MURRAY, Washington
    RICHARD BURR, North Carolina		BERNARD SANDERS (I), Vermont
    JOHNNY ISAKSON, Georgia			ROBERT P. CASEY, JR., Pennsylvania
    RAND PAUL, Kentucky			MICHAEL F. BENNET, Colorado
    SUSAN M. COLLINS, Maine			TAMMY BALDWIN, Wisconsin
    BILL CASSIDY, M.D., Louisiana		CHRISTOPHER S. MURPHY, Connecticut
    TODD YOUNG, Indiana			ELIZABETH WARREN, Massachusetts
    ORRIN G. HATCH, Utah			TIM KAINE, Virginia
    PAT ROBERTS, Kansas			MAGGIE HASSAN, New Hampshire
    LISA MURKOWSKI, Alaska			TINA SMITH, Minnesota
    TIM SCOTT, South Carolina		DOUG JONES, Alabama

                   David P. Cleary, Republican Staff Director
             Lindsey Ward Seidman, Republican Deputy Staff Director
                      Evan Schatz, Democrat Staff Director
                  John Righter, Democrat Deputy Staff Director

                                     ------

             SUBCOMMITTEE ON PRIMARY HEALTH AND RETIREMENT SECURITY

                       MICHAEL B. ENZI, Wyoming, Chairman
    RICHARD BURR, North Carolina         BERNARD SANDERS (I), Vermont
    SUSAN M. COLLINS, Maine              MICHAEL F. BENNET, Colorado
    BILL CASSIDY, M.D., Louisiana        TAMMY BALDWIN, Wisconsin
    TODD YOUNG, Indiana                  CHRISTOPHER S. MURPHY, Connecticut
    ORRIN G. HATCH, Utah                 ELIZABETH WARREN, Massachusetts
    PAT ROBERTS, Kansas                  TIM KAINE, Virginia
    TIM SCOTT, South Carolina            MAGGIE HASSAN, New Hampshire
    LISA MURKOWSKI, Alaska               DOUG JONES, Alabama
    LAMAR ALEXANDER, Tennessee (ex       PATTY MURRAY, Washington (ex
        officio)                             officio)

                                C O N T E N T S

                                  ----------

                                   STATEMENTS

                          TUESDAY, SEPTEMBER 25, 2018

                                                                       Page

                               Committee Members

    Enzi, Hon. Mike, Chairman, Subcommittee on Primary Health, and
      Retirement Security, Opening statement.........................     1
    Sanders, Hon. Bernard, Ranking Member, a U.S. Senator from the
      State of Vermont, Opening statement............................     2

                                   Witnesses

    Glause, Tom, Commissioner, Wyoming Department of Insurance,
      Cheyenne, WY...................................................     5
        Prepared statement...........................................     6
    Reed, Morgan, President, App Association, Executive Director,
      Connected Health Initiative, Washington, DC....................     9
        Prepared statement...........................................    11
    Levine, Alan, Executive Chairman, President, and Chief Executive
      Officer, Ballad Health, Johnson City, TN.......................    31
        Prepared statement...........................................    33
    Richter, Deborah, MD, Family Physician and Addiction Medicine
      Specialist, and Chair, Vermont Healthcare for All, Cambridge,
      VT.............................................................    39
        Prepared statement...........................................    41

                         HEALTH CARE IN RURAL AMERICA:
                        EXAMINING EXPERIENCES AND COSTS

                                  ----------

                          Tuesday, September 25, 2018

                                           U.S. Senate,
        Subcommittee on Primary Health and Retirement Security,
           Committee on Health, Education, Labor, and Pensions,
                                                        Washington, DC.
        The Subcommittee met, pursuant to notice, at 3:42 p.m., in
    room SD-430, Dirksen Senate Office Building, Hon. Mike Enzi
    presiding.
        Present: Senators Enzi [presiding], Alexander, Young,
    Roberts, Sanders, Bennet, Kaine, Hassan, and Jones.

                       OPENING STATEMENT OF SENATOR ENZI

        Senator Enzi. I'm going to go ahead and open this
    roundtable of the Subcommittee on Primary Health and Retirement
    Security, and when Senator Sanders is here we'll give him an
    opportunity to do an opening statement.
        Today we're talking about healthcare in rural America,
    examining experiences and costs and looking for solutions. One
    of the things I always appreciate about my people in Wyoming is
    when they complain to me, they usually have some idea for how
    to solve it. Sometimes they don't work, but sometimes they're
    an excellent idea, and sometimes they are in-between there
    where there's a germ of an idea that just needs to be grown a
    little bit to see if it will work.
        I thank everybody for coming today for this roundtable. I
    want to thank the Ranking Member, Senator Sanders, and his
    staff for working to put together a conversation about rural
    healthcare. I'd also like to thank all my colleagues that are
    here today for being ready to engage in this important
    discussion. I appreciate all of the participants for taking the
    time and making the effort to come today to be part of the
    discussion. I know several of you traveled great distances to
    be here.
        Chairman Alexander has held a series of important hearings
    at the full Committee level to take a close look at healthcare
    costs throughout the system. We hear too often that Americans
    are struggling to afford and understand their medical bills,
    particularly to understand their medical bills, so it's
    important to examine what drives healthcare costs and how we
    can create more value for patients particularly, and
    specifically in rural areas.
        Several years ago I formed a rural caucus, and I found that
    almost every state wanted to be represented in that caucus,
    plus the District of Columbia. I have a little trouble finding
    rural in the District, but I'm sure it's there, and as long as
    they join us in solutions, that's okay, because the purpose is
    to unite and help rural areas.
        I'm from Wyoming, which is the least populated state in the
    Nation. Our biggest city is only 60,000 people. All of our
    towns are at least 40 miles apart, and there are only 17 towns
    where the population is greater than the elevation, and almost
    every one of those towns are at least 100 miles apart. People
    love Wyoming's close-knit communities, the wide-open spaces,
    but Wyomingites also face some of the highest healthcare costs
    in the country, in part due to the challenges that come with
    delivering care in a cost-effective manner when our low
    population is spread across those 97,000 square miles.
        It struck me that as we explore the healthcare costs in
    more depth, we need also to take a serious look at healthcare
    in rural America to understand the unique challenges that rural
    patients and providers face, how those challenges can affect
    the cost of care, and learn more about how our current policies
    are working and where they might be improved.
        The purpose of a roundtable is to gather information. I
    appreciate the witnesses being willing to testify. This works a
    little different than a regular hearing. After the opening
    statements and then your statements, we'll ask some questions.
    But at any point, rather than it just being directed to one
    person, anybody that wants to comment on that, just stand your
    name tag up on end and we'll know you want to speak on it,
    because we need as many ideas as we can possibly get.
        A lot of people have told me that their insurance premiums
    are unaffordable, and some of them said that they have to pay
    more than their mortgage. But a lot of that's related, all of
    it's related to healthcare costs: the provider, the amount of
    choice that there is, how to recruit them, if you're able to
    get specialties--probably isn't going to happen in rural areas.
    So how do you get them the healthcare? Maybe price
    transparency. Another area is more competition in the
    individual market, and telemedicine, of course, is gaining some
    support, and examples in rural states. Then, of course, a
    little bit with the privacy issue. So those are all things I
    hope we can get into a little bit today.
        First I'll have Senator Sanders speak, and then I'll
    introduce the panel and we'll get going.

                      OPENING STATEMENT OF SENATOR SANDERS

        Senator Sanders. Thank you very much, Senator Enzi, for
    calling this important hearing.
        Senator Enzi and I have at least two things in common. One,
    I like him. Number two, we both come from very rural states. We
    don't have big cities like 60,000 in the State of Vermont. We
    only have 40,000 as the largest city, so we kind of are more
    rural than you are, maybe.
        My views might be just a tad different than Senator Enzi's,
    just a tad. The bottom line to me is it is an international
    disgrace--and the day will come, and more and more people
    understand it--that we are the only major country on earth not
    to guarantee healthcare to every man, woman, and child in
    Wyoming and Vermont as a right, not a privilege. That is the
    basic issue. Do we believe healthcare is a right, or do we not?
    And if you don't, and if we think that the function of
    healthcare is for insurance companies and drug companies to
    make billions in profits, fine, then you're over here.
        But if you agree with what I believe the vast majority of
    the American people believe--and I should tell you that the
    latest poll that I saw from Reuters found that 70 percent of
    the American people, including a majority of Republicans, now
    believe in a Medicare-for-all, single-payer system--then you
    hold a different view.
        Second issue is we have got to ask ourselves--Senator Enzi
    appropriately says the cost of healthcare is very, very high.
    Of course it's high. We pay almost twice as much per capita for
    healthcare as any other nation on earth, and we're going to
    have to deal with that. I know my Republican friends don't want
    to deal with it. In Canada, it's about half as much. Other
    countries, less than half as much, and that healthcare outcomes
    in terms of the outcomes in other countries is often better
    than it is in ours in terms of life expectancy and infant
    mortality and how we treat many of the diseases.
        In terms of prescription drugs, I'm sure a major issue in
    Wyoming, certainly a major issue in America, are we satisfied
    that we pay, by far, the highest prices in the world for the
    same damn drugs that are sold around the world for a fraction
    of the price that is sold in the United States? Are we happy
    that the five major drug companies in the world made $50
    billion in profit last year, pay their CEOs exorbitant
    compensation packages, and yet one out of five Americans cannot
    afford the medicine that doctors prescribe? How insane is that?
    You go to the doctor, they write a prescription, and you can't
    afford to fill that prescription, and then you end up in the
    emergency room or you end up in the hospital. Are we satisfied
    that in rural America, parts of urban America, there are no
    doctors?
        I think Senator Roberts a couple of years ago--Senator,
    correct me if I'm wrong, but you were telling me I think in
    parts of Kansas there are counties where there are no doctors.
    That's what you said a couple of years ago. Is that correct?
    Yes. And I was in Mississippi. In large parts of Mississippi,
    there are no doctors. And yet we have a system that says if you
    are a doctor, you're going to graduate medical school $400,000
    in debt, so you're going to become a dermatologist on Park
    Avenue, New York, but you're not going to go to rural Vermont
    or rural Wyoming. So we have to rethink healthcare in general.
        But I'm glad that Senator Enzi has called this hearing,
    because when we look at healthcare, it is a really, really
    serious problem in rural America, part of many other problems
    that rural America faces.
        I was told recently by somebody who seemed to be
    knowledgeable that two-thirds, Senator Enzi, two-thirds of
    rural counties in America are depopulating, two-thirds. I know
    in our most rural areas in Vermont, it's happening. In
    Burlington, Vermont, doing very, very well economically, rural
    American farms going out of business, et cetera, et cetera.
        We have to do a lot of thinking. But I would hope that at
    the end of the day, we understand that healthcare is a right,
    not a privilege, that the function of healthcare is not to make
    huge profits for insurance companies and drug companies, that
    there's something obscenely wrong when we spend twice as much
    per capita on healthcare as the people of other nations, who
    often have better healthcare outcomes than we do.
        But thank you again, Senator, for calling this meeting.
        Senator Enzi. Thank you, Senator Sanders.
        I'll now provide a brief introduction of our panel and then
    invite each of you to give a 5-minute statement, and then we'll
    do some questions.
        First, I'd like to introduce the Wyoming Commissioner, Tom
    Glause. He was appointed Commissioner of the Wyoming Department
    of Insurance by Governor Mead on January 3, 2015, and he has a
    deep understanding of the elements of what drives healthcare
    costs in the State of Wyoming and is an active participant on
    several committees and working groups at the National
    Association of Insurance Commissioners. He is also a prime
    source for me when I have a question about healthcare and comes
    out regularly to appear.
        Next I welcome Morgan Reed of App Association. Morgan Reed
    is originally from Alaska, so he understands rural health
    issues personally, and he's an expert on the ways that health
    information technology can improve patient care.
        Senator Alexander apologizes for not being able to be here
    to introduce the next witness. Mr. Levine is Executive
    Chairman, President, and Chief Executive Officer of Ballad
    Health, which operates 21 hospitals in Virginia and Tennessee.
    In April he had the pleasure of visiting Children's Hospital in
    Johnson City, which is part of Ballad's system, where Senator
    Alexander witnessed firsthand some of the great work Mr. Levine
    and his team are doing on the front lines of opioids by helping
    treat newborn children who suffer from neonatal abstinence
    syndrome. Prior to Ballad Health, Mr. Levine was President and
    CEO of the Mountain States Health Alliance. He has significant
    experience in state government as Secretary of Louisiana's
    Department of Health and Hospitals and as Secretary of
    Florida's Agency for Healthcare administration under Governor
    Bush. In those roles he helped oversee the response to 12
    hurricanes and led the effort to improve Louisiana's child
    immunization rates from 48th in the Nation to second. Tennessee
    ranks second in the Nation with the highest number of rural
    hospital closures, so Mr. Levine knows very well the challenge
    facing rural providers today. I look forward to hearing his
    thoughts.
        Then, Senator Sanders, did you want to introduce the next
    witness?
        Senator Sanders. I'm very pleased to welcome Dr. Deborah
    Richter to be with us. I've known Dr. Richter for many, many
    years. She is an expert and a hard worker in dealing with
    people with addiction issues. But more importantly, in Vermont,
    she has probably been the leader in the fight to make sure that
    all of our people have healthcare as a right, not a privilege.
    In Vermont we're making some progress in that area, and the
    progress we're making Dr. Richter has a lot to do with. So, Dr.
    Richter, thanks so much for being with us.
        Senator Enzi. Okay, we'll get started on the testimony.
        Mr. Glause.

     STATEMENT OF TOM GLAUSE, COMMISSIONER, WYOMING DEPARTMENT OF
                        INSURANCE, CHEYENNE, WY

        Mr. Glause. Thank you, Chairman Enzi, Committee Members.
    I'd like to invite you to pull on your cowboy boots and take a
    walk through rural America with me as we discuss the issues
    regarding healthcare delivery in rural areas. My son Seth is a
    professional bull rider----
        Senator Enzi. Is your mic on? There should be a little red
    light that comes on.
        Mr. Glause. I'll talk closer to it.
        Senator Enzi. That works. Thank you.
        Mr. Glause. My son Seth is a professional bull rider. In
    2012, he was on the verge of winning a world championship. At
    the fifth round of the national finals rodeo that year, he had
    drawn a bull named Canadian Tuxedo. That bull came out of the
    chute spinning hard to the right. Somehow, Seth managed to stay
    on for the entire eight seconds. But as he was dismounting the
    bull, his arm came over the back of the bull as the bull kicked
    and hyperextended his shoulder. During the course of the next
    two years, he had four major surgeries on his shoulder. None of
    those surgeries occurred within the State of Wyoming, which
    leads me to the first topic that I would like to address with
    you, and that is a lack of providers in rural areas.
        Wyoming only has 179 doctors per 100,000 people and, mind
    you, our population is only 585,000 to start with. So to do the
    simple math, that means we only have about 1,100 doctors
    servicing over 97,000 square miles. That's only 50 doctors per
    100,000, below the national average.
        It's no secret that it's more expensive to deliver
    healthcare in rural areas. Wyoming has the second-highest
    insurance rates in the country. Contributing to those costs are
    long distances between towns and fewer providers. Smaller
    communities simply cannot afford the multi-million-dollar
    equipment that is necessary to practice medicine in today's
    world. Thermopolis, Wyoming, a town of 2,000 people in central
    Wyoming, simply does not have the population base to amortize
    the cost of an MRI machine over the more urban areas.
        Also contributing to the problem is 70 percent of the
    population in Wyoming lives within 70 miles of a state border,
    and we see a large out-migration of healthcare delivery to more
    populated areas.
        Another area of concern in Wyoming is the Medicare
    reimbursement rate. The two largest hospitals in the state
    report that Medicare reimburses them only 65 percent of their
    actual cost and that Medicare patients account for 50 percent
    of their book of business. This amounts to a large cost
    shifting to the non-Medicare population. In short, that means
    that they have to make up for the cost of that care by passing
    it on to those with private insurance.
        Please remember, healthcare costs drive insurance costs,
    not the other way around.
        In the short time I have here, I would like to ask you to
    consider several suggestions for improvement.
        We need to find a way to incentivize residents entering the
    medical profession in rural areas. Simply stated, we need more
    doctors in rural areas.
        We need to increase programs to reduce smoking. Wyoming has
    a higher than national average rate of smoking. I believe it's
    19.6 percent. The image of the Marlboro Man riding down off the
    mountains chasing the horses needs to disappear as we improve
    our health status in Wyoming.
        We also need to increase price transparency. People need to
    know that they're getting low-cost medical care, but they need
    to be assured that they are also getting quality care. Try
    finding out how much it costs to get a procedure done at a
    local hospital and it's nearly impossible.
        We also need to increase the Medicare reimbursement rate so
    we don't have that cost shifting. I would encourage you to
    support suspending the health insurance tax after 2019.
        Air ambulance also needs to be addressed to give states
    greater flexibility in addressing air ambulance service in
    rural communities.
        The people in Wyoming and all of rural America deserve
    quality, affordable, and accessible healthcare. Thank you.
        [The prepared statement of Mr. Glause follows:]
                        prepared statement of tom glause
        Good afternoon. My name is Tom Glause. I am the Insurance
    Commissioner for the State of Wyoming. I would like to thank this
    Committee and especially Wyoming Senator Mike Enzi for the opportunity
    to address you today. In our short time together, I plan to discuss
    several of the issues and concerns facing health care delivery and
    health insurance in rural or frontier states like Wyoming and to
    provide you some considerations for changes.

        Numerous studies report that access to healthcare is important for
    many reasons that effect the physical and mental well-being of our
    citizens. \1\ However, in rural settings healthcare and health
    insurance face additional access and affordability challenges.
    ---------------------------------------------------------------------------
        \1\  Health care effects include overall physical, social, and
    mental health status, prevention of disease, detection and treatment of
    illnesses, quality of life, preventable death and life expectancy as
    identified in Healthy People 2020, https://www.healthypeople.gov/2020/
    leading-health-indicators/2020-lhi-topics/Access-to-Health-Services.

        Rural residents often experience barriers to health care that limit
    their ability to obtain the care they need. Increased cost of health
    care in turn increases health insurance costs. We must remember that
    ---------------------------------------------------------------------------
    health care costs drive insurance costs.

        I would like to outline several areas in which rural residents face
    challenges in health care and health insurance:

        Access. Rural areas often have fewer medical providers and
    transportation limitations to reach services that may be located at a
    considerable distance. Further, rural residents have difficulties in
    the ability to take paid time off of work to use such services.
    Frankly, farmers and ranchers don't have ``days off'' from tending to
    livestock. Further, 43.4 percent of uninsured rural residents report
    that they do not have a ``usual source of care.'' \2\, \3\ Only 24
    percent of rural residents can reach a top trauma center within an
    hour. Rural areas suffer 60 percent of America's trauma deaths despite
    having only 20 percent of the Nation's population. Necessary and
    appropriate services must be available and obtainable in a timely
    manner.
    ---------------------------------------------------------------------------
        \2\  June 2016 ASPE issue brief; https://aspe.hhs.gov/system/files/
    pdf/204986/ACARuralbrief.pdf.
        \3\  ``Usual source of care'' (USC) refers to the provider or place
    a patient consults when sick or in need of medical advice.

        Available and Affordable Health Insurance Coverage. Rural areas
    tend to have fewer insurance companies offering plans. \4\ Wyoming has
    just one carrier on the Marketplace and two carriers in the Small Group
    market. Premium increases tend to be higher where there is less
    competition among insurers. Although 2019 rates are flat, Wyoming saw
    2018 plans average increases of 48.6 percent for individual plans and
    30.7 percent for small group plans.
    ---------------------------------------------------------------------------
        \4\  Geographic Variation in Health Insurance Marketplaces: Rural
    and Urban Trends in Enrollment, Firm Participation, Premiums, and Cost
    Sharing in 2016, researchers from the RUPRI Center for Rural Health
    Policy Analysis, August 2016.

        Hospitals in Wyoming report that Medicare reimbursement is just 65
    percent of the actual costs. This low reimbursement rate results in
    cost shifting to the non-Medicare population. Rising costs of care
    ---------------------------------------------------------------------------
    result in rising insurance rates.

        Rural residents often have limited financial resources to pay for
    services, including available and affordable health insurance that is
    accepted by their provider. Rural uninsured are more likely to delay or
    forgo medical care because of the cost of care compared to those with
    insurance. Nearly 30 percent of rural residents report delayed care or
    report they did not receive care in the previous year due to the cost.

        Workforce Shortages--Having an adequate health workforce is
    necessary to providing that ``usual source of care.'' A shortage of
    healthcare professionals in rural America can limit access to care. \5\
    ---------------------------------------------------------------------------
        \5\  In September 2018, rural areas made up 57.27 percent of the
    primary care health professional shortage areas. See data.HRSA.gov
    Preformatted Report, ``Shortage Areas, Health Professional Shortage
    Area (HPSA)--Basic Primary Medical Care: Designated HPSA Statistics.''

        Medical Service Delivery Challenges--It is more challenging to
    deliver healthcare services in sparsely populated areas. Small
    communities are unable to support full-time physicians for many medical
    specialties, and the fixed costs of multi-million-dollar hospital
    equipment cannot be spread across as many patients as in urban or
    densely populated areas. Rural uninsured face greater difficulty
    accessing care due to the limited supply of rural healthcare providers
    who offer low-cost or charity healthcare. \6\ Advanced technologies and
    expensive medical equipment are cost prohibitive to smaller facilities
    and communities.
    ---------------------------------------------------------------------------
        \6\  Kaiser Family Foundation, 2014, 2016 issue briefs, https://
    www.kff.org/uninsured/report/the-uninsured-a-primer-key-facts-about-
    health-insurance-and-the-uninsured-under-the-affordable-care-act.

        Privacy/confidentiality. Social stigma and privacy concerns are
    more likely to act as barriers to healthcare access in rural areas.
    Rural residents need confidence in their ability to use services
    without compromising privacy. Residents may be concerned about seeking
    care for issues related to mental health, substance abuse, sexual
    health, pregnancy, or even common chronic illnesses due to privacy
    concerns. This may be caused by personal relationships with their
    healthcare provider or others that work within the health care
    facility. In addition, concerns about other residents noticing them
    utilizing services such as mental healthcare can be a concern.
    ---------------------------------------------------------------------------
    Integration of behavioral health services with primary care can help.

        Impact on Wyoming. All of these rural population factors affect the
    people of Wyoming. As a result, Wyoming's insurance rates are generally
    regarded as the second highest in the Nation. \7\ Wyoming is truly the
    land of wide open spaces, but that claim comes with a price. We are the
    least populated state in the Nation in the tenth largest geographic
    area of approximately 98,000 square miles. \8\ We know the impact of
    long distances between towns and medical providers and we know the
    effect on health insurance costs. Wyoming knows the impact of having
    fewer medical providers and limited specialists. Wyoming has just 178
    physicians per 100,000 population compared to the national average of
    229. \9\
    ---------------------------------------------------------------------------
        \7\  Survey rankings vary depending upon criteria evaluated. Price
    alone doesn't reflect access, availability, quality of care, and
    effect. See e.g. ``Health Insurance Coverage of the Total population,''
    Kaiser Family foundation, KFF, https://www.kff.org/other/state-
    indicator/total-population/'currentTimeframe, ``Health Insurance Rates
    by State,'' https://howmuch.net/articles/health-insurance-rates-by-
    state; ``Best and Worst States for Health Care,'' https://
    wallethub.com/edu/states-with-best-health-care/23457/.
        \8\  Wyoming has a total population of 585,501 in a geographic area
    of 97,814 sq. miles.
        \9\  Skillnan SM, Dahal A. Wyoming's Physician Workforce in 2016.,
    Seattle, WA:WWAMI, Center for Health Workforce Studies, University of
    Washington, Feb 2017.

        Additional factors that contribute to Wyoming's high insurance
    rates are that many residents seek medical care from out-of-state
    providers. Approximately 70 percent of Wyoming's population lives
    within 70 miles of a state border and larger urban centers with medical
    ---------------------------------------------------------------------------
    care.

        Lastly, according to the Centers for Disease Control and Prevention
    (CDC) the prevalence of cigarette smoking among U.S. adults is highest
    among those living in rural areas. \10\ Unfortunately, Wyoming has a
    higher than average smoking rate. \11\
    ---------------------------------------------------------------------------
        \10\  https://www.cdc.gov/tobacco/disparities/geographic/index.htm.
        \11\  https://truthinitiative.org/tobacco-use-wyoming.

    ---------------------------------------------------------------------------
        Possible Solutions or Areas for Development:

        I don't believe in merely exposing a problem without offering areas
    for development or change. I offer the following suggestions:

            1. Allow a lower medical loss ratio (MLR) for insurance
            carriers who cover rural areas because the administrative costs
            per person are higher for rural areas. Allowing insurers to
            have a somewhat higher allowance for higher administrative
            expenses and profits would make it easier and more attractive
            for them to operate in rural areas. If more insurers are
            willing to operate in rural areas, their presence can increase
            competition and bring premiums down even more than the amount
            that the premium would increase because of the lower MLR. Also,
            if there were an increase, subsidized consumers would be
            protected by the structure of the premium tax credit, though of
            course unsubsidized consumers are not.

            2. Allow states more flexibility in setting rating areas or
            rating rules to provide more affordable options in rural areas.
            States could use rating areas to help spread the higher cost of
            rural coverage across both rural and urban areas of a state.

            3. Create a Federal grant program to help states work with
            providers and carriers to provide lower-cost and higher-quality
            care in rural areas. The funds could be used to assist rural
            hospitals and clinics, promote telemedicine, and improve
            transportation. By funding these kinds of services through
            Federal grants, they don't have to be paid for by enrollee
            premiums, leading to lower rates for all consumers.

            4. Fund Association Health Plans for Farmers/Ranchers to
            provide more options as proposed in the Farm Bill
            reauthorization. Providing initial funding for associations of
            farmers can help introduce needed competition to rural
            insurance markets. While co-ops under the ACA did not prove to
            be successful, agricultural associations--like the Western
            Growers Association--have demonstrated a proven model for
            independent businesses to band together to meet their health
            care needs.

            5. Increase the availability and proper use of telehealth.
            Through telehealth, rural patients can see specialists in a
            timely manner while staying in their home communities.

            6. Increase transparency in cost of services. Studies have
            documented wide differences in the cost of services, even when
            accounting for differences in income, demography, and health
            status within regions. Increase transparency on Medicare
            reimbursements, cost shifting, and rate determinations.

            7. Increase provider competition. Lack of provider competition
            in some geographic areas gives available providers market power
            to set rates for services. A study by the National Bureau of
            Economic Research found that prices charged by hospitals in
            monopoly markets was 12 percent higher than in markets with
            four or more hospitals. \12\
    ---------------------------------------------------------------------------
        \12\  ``The Price Ain't Right, Hospital Prices and Health Spending
    on the Privately Insured,'' Cooper, Craig, Gaynor, van Reenen, NBER
    Working Paper No. 21815, May 2018.

            8. Increase competition among health insurers. When there is
            more competition insurers seek lower rates and gain greater
            market share. More enrollees means insurers can spread risk
    ---------------------------------------------------------------------------
            across a greater population base and reduce premiums.

            9. Increase programs to reduce smoking. The negative health
            impact of smoking is widely known. Greater education and
            programs to reduce smoking in rural areas may go a long way in
            reducing health and insurance costs.

            10. Support legislation to continue the suspension of the
            Health Insurance Tax (HIT) beyond 2019 and to restrict balance
            billing. The HIT tax is paid by insurers but the cost is passed
            on to consumers. \13\ Consumers too often receive unexpected
            bills from out-of-network providers, often for thousands of
            dollars. This can occur even when consumers choose in-network
            facilities. While some states have taken action to limit this
            practice, congressional action is needed to address federally
            regulated plans and to spur further state protections. Balance
            billing has been particularly egregious with some air ambulance
            companies.
    ---------------------------------------------------------------------------
        \13\  See e.g. ``Legislation to suspend the Health Insurance Tax
    Will Help Make Premiums More Affordable,'' AHIP, https://www.ahip.org/
    legislation-to-suspend-the-health-insurance-tax/.

            In Wyoming, we depend on air ambulances and want to keep the
            industry strong, but we do not want consumers caught in the
            middle of billing disputes between insurers and service
            providers. Wyoming and other states are prevented by Federal
            law from addressing the excessive billing practices of some
            companies. With the Federal Aviation Administration (FAA)
            Reauthorization moving through Congress, there's an opportunity
            to address this concern and give insurance commissioners the
            authority they need to regulate effectively in their states.
            Although FAA is not within the jurisdiction of this Committee,
            but I hope all Senators will support the language in the House
            version of the FAA bill to bring more transparency and consumer
    ---------------------------------------------------------------------------
            protections to the air ambulance industry.

        Thank you again for the opportunity to provide some input on the
    health care and health insurance picture in rural America.
                                     ______

        Senator Enzi. Thank you.
        Mr. Reed.

    STATEMENT OF MORGAN REED, PRESIDENT, APP ASSOCIATION, EXECUTIVE
         DIRECTOR, CONNECTED HEALTH INITIATIVE, WASHINGTON, DC

        Mr. Reed. Thank you, Mr. Chairman. My name is Morgan Reed.
    I'm the President of the App Association and the Executive
    Director of the Connected Health Initiative, a coalition of
    doctors, research universities, patient advocacy groups, and
    leading mobile health tech companies. Our organization focuses
    on clarifying outdated health regulations and using digital
    health tools to improve the lives of patients and their
    doctors.
        Constituents in rural America face serious challenges in
    getting cost-effective, quality care. People are too far away
    from healthcare services. The cost, frankly, is too much, and
    it's likely to get worse. By 2030, more than 70 million
    Americans will be over the age of 65. By 2025, we will have a
    shortfall of more than 90,000 physicians. And while about 20
    percent of Americans live in rural areas, only 10 percent of
    physicians practice there. Finally, 44 percent of rural
    hospitals are currently underwater and are at risk of closure.
        Yet we live in a world where every person can pay their
    mortgage, monitor their package delivery, review their child's
    homework, all while sitting in the waiting room of their
    doctor, who, by the way, can't use those same technologies for
    digital health. What's going on that rural caregivers can't
    better engage with patients using the tools that every single
    one of you currently have in the palm of your hand or on your
    wrist? Why is it that CMS reimburses $1 trillion a year but
    can't reimburse telehealth and remote monitoring in rural areas
    in a meaningful way? Why doesn't the system help doctors to
    treat patients and not the keyboard?
        This hearing takes place at a critical moment for
    healthcare in rural America, and it is of personal importance
    to me. I was born and raised in Alaska, and my father is from a
    town of 500, and I have friends and family where there are no
    roads and where there is not a single healthcare professional
    within 500 miles. So I guess we're all kind of out-ruraling
    each other. I've got the 500-mile range. And yet Federal
    agencies can't even agree on what rural means.
        There's a great chart in my written testimony which shows
    four qualified rural health clinics in extremely remote
    counties in Virginia that agencies like USDA and FCC rightfully
    consider rural. Yet incomprehensibly, CMS does not consider
    these objectively rural areas to be rural. The University of
    Virginia Center for Telehealth finds itself unable to help the
    very people for whom getting to a doctor quickly is an
    insurmountable problem.
        It's not just a Virginia problem. Throughout America,
    academic and other medical centers find CMS' system governing
    telehealth is basically broken. Rather than attempt to get five
    Federal agencies to agree on the definition of rural, we think
    it's best for all of your constituents to have access to
    telehealth and digital medicine, regardless of how close they
    are to Main Street.
        For patients, remote monitoring technologies are life-
    saving tools. One of our steering committee members makes a
    foot mat you stand on for 20 seconds when you're brushing your
    teeth. It detects foot ulcers up to 5 weeks before they present
    clinically. This tech is not only more efficient than other
    methods, but it cuts down on hospital bills and ultimately
    saves limbs. Doctors like it because the patient stays engaged,
    but reimbursement under Medicare remains a question mark.
        We're all familiar with the horror stories from doctors
    about EHR adoption and the epic burnout we see as a result.
    Doctors find EHRs can create extra work and ultimately prevent
    entered data from being used predictably as part of machine
    learning or augmented intelligence systems. For taxpayers, it's
    about providing the right incentives for the right things at
    the right time. And when it comes to preventive health, this
    begins with expansion of the CBO scoring window, and I want to
    thank Senator Bennett for his support for the Preventive Health
    Savings Act. That's a good start. Preventive medicine can do
    much more.
        You mentioned Mississippi. The University of Mississippi
    Medical Center's telehealth program would save the State of
    Mississippi $189 million in Medicaid if just 20 percent of
    Mississippi's diabetic population were enrolled. Just think of
    the taxpayer savings for the whole country if CMS actually
    supported what UMMC is doing today.
        Here are a couple of actions that Congress can hit in order
    to make the mark.
        First, pass the Connect for Health Act. I want to thank
    Senators Kaine, Bennet, and Murkowski for co-sponsoring. It
    would clarify that Medicare covers tech-driven tools that
    enhance efficiency and clinical advocacy, including the removal
    of outdated restrictions on 1834(m).
        Second, CMS should provide reimbursement and incentives for
    collecting and using patient-generated health data.
        Third, Congress should file down regulations like the anti-
    kickback statute and Stark Law that allow providers to get
    technology into the hands of patients.
        Finally, Congress should support the use of unlicensed
    spectrum, including television white space technology, to help
    cover rural populations and give them the high-speed broadband
    that can help make this a reality.
        We are all part of the system, either as patients or
    caregivers. The least we can ask is for a system that treats
    us, whether we are in rural or urban areas, as real people, not
    just boxes on a spreadsheet.
        Thank you very much, and I look forward to your questions.
        [The prepared statement of Mr. Reed follows:]
                       prepared statement of morgan reed
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        Senator Enzi. Thank you.
        Mr. Levine.

     STATEMENT OF ALAN LEVINE, EXECUTIVE CHAIRMAN, PRESIDENT, AND
        CHIEF EXECUTIVE OFFICER, BALLAD HEALTH, JOHNSON CITY, TN

        Mr. Levine. Thank you, Mr. Chairman. My name is Alan
    Levine. I'm the Executive Chairman of Ballad Health, a 21-
    hospital integrated health delivery system serving 29 counties
    in Southwest Virginia and Northeast Tennessee. I also formerly
    served as the Secretary of Health for the State of Louisiana,
    and in Florida.
        I'm pleased to provide this oral testimony as a supplement
    to the written testimony I've submitted, and I look forward to
    answering your questions about it later.
        Tennessee has made many contributions to America, and
    yesterday I had the opportunity to visit one such gift, the St.
    Jude Children's Research Hospital, a place in Memphis where
    research and precision medicine are creating cures for
    children's cancer. And as I toured the hospital, it occurred to
    me that just more than an hour away in a small rural community
    in Tennessee, a local hospital was closing that very day and
    people were losing their jobs. This was the ninth such closing
    in Tennessee since 2010.
        What a vivid picture that was of the increasing distance
    between our urban and rural communities. In one, Memphis, we
    have research in progress, led by a world-renowned institution,
    and in a rural community just more than an hour away, the
    community lost its hospital.
        Evidence is mounting that our policies are having
    unintended consequences on our rural health safety net and our
    non-urban hospitals. Almost 90 rural hospitals nationwide have
    closed in the last 8 years, and 673 rural hospitals are
    reported to be at risk of closure. Forty-four percent of them
    have negative operating margins in 2018, up from 40 percent
    just 12 months earlier.
        The healthcare culture of any community revolves around its
    hospital. As non-urban hospitals struggle and rural hospitals
    close, the opportunity to improve the health of these
    communities is diminished. Policies intended to transform the
    government payment system from fee-for-volume to fee-for-value
    are complex and frankly seem more appropriately targeted to
    larger urban and suburban hospitals which have both the
    critical mass of patients and the resources to test these
    models; models, I would add, which are constantly changing and
    which have led in part to increases in bad debt, uncollectible
    revenue, increases in the number of physicians who give up
    private practice and either seek employment or retire, and to
    unpredictability of cash-flow for those hospitals. Smaller non-
    urban and rural hospitals have neither the patient volume nor
    the sophistication to deploy these new reimbursement models.
        As the government payers move toward shifting more risk to
    hospitals, smaller hospitals and those with debt simply do not
    have the balance sheet strength to succeed and certainly will
    struggle to invest in the infrastructure needed to improve the
    management of chronic care and population health, which are
    really the intended outcomes of all these policies to begin
    with.
        Consider that in non-urban and rural communities, which
    make up almost 95 percent of our Nation's land area, they are
    seeing population stagnation or decline, and due to the
    policies intended to reduce inpatient utilization, policies I
    think we all agree with, the combination of no population
    growth with reducing inpatient utilization means the non-urban
    and rural hospitals are stuck in a business model which is
    destined to fail.
        For example, as the inpatient utilization rates in
    Nashville, Tennessee declined from 110 per thousand to less
    than 100 per thousand, the population in Nashville grew. So the
    hospitals have thrived there because the economy was expanding
    and the population was growing. But in my region, where many of
    the counties are seeing population declines as inpatient use
    rates decline, there is no population growth to sustain the
    hospital.
        We are therefore seeing year-over-year declines in
    inpatient services in these rural markets. In most cases, this
    begins a death spiral. Reduced revenue means lack of capital to
    invest in technology equipment and recruitment of doctors. Add
    to this the complexity of payment changes imposed by state and
    Federal Governments and the inability of rural hospitals to
    deploy even the simplest of these payment changes and you end
    up with a rural hospital failure.
        I don't think the responsible answer is to either just pay
    more or let rural hospitals close. I think the choice is
    broader than that, but we need to focus on the real problem we
    are trying to solve. We are not trying to save hospitals for
    the sake of bricks and mortar. We actually have real problems
    in these communities we need those hospitals to help solve.
        Rural Americans have a higher rate of death from disease, a
    higher rate of death from overdose, and the incidence of
    complications and deaths for moms and babies is higher in rural
    areas due to the same factors that lead to higher rates of
    disease in rural communities. So rather than just throw money
    at the problem, I think we can build a bridge to a rural safety
    net that serves today's rural health needs better.
        My written testimony highlights steps that I hope we can
    talk about during the Q&A, and I look forward to discussing the
    steps that can build this bridge to a sustainable rural model
    and a sustainable business model. I do believe the area wage
    index is a major problem for our country. Senator Alexander,
    Senator Kaine, you guys have been champions in trying to help
    deal with that issue. That would be one of the single most
    important things you can do for rural hospitals and non-urban
    hospitals.
        I think our rural hospitals can be repurposed. I think
    there are services like mental health, addiction, emergency
    services, and maternal services for women and babies where
    rural hospitals, we have a need for those services rather than
    some of the high-end acute services that we might have needed
    30 years ago. So repurposing of these hospitals is a real
    opportunity.
        I look forward to answering your questions and to the
    dialog we're about to have. Thank you.
        [The prepared statement of Mr. Levine follows:]
                      prepared statement of alan m. levine
        Chairman Enzi, Chairman Alexander, Ranking Member Sanders, Ranking
    Member Murray, and Members of the Committee, thank you for the
    invitation and opportunity to appear before you this afternoon.

        My name is Alan Levine, and I currently serve as the executive
    chairman, president and chief executive officer of Ballad Health, a 21-
    hospital, not-for-profit integrated healthcare delivery system uniquely
    created through state action immunity upon the merger of two regional
    health systems. We serve 29 counties in the Appalachian region of Upper
    East Tennessee, Southwest Virginia, East Kentucky, and Western North
    Carolina.

        Thank you for inviting me to discuss the variety of healthcare
    challenges facing Americans in rural areas, and the concerns those of
    us responsible for delivering health care services have with respect to
    ensuring access and improving health. As the evidence shows, rural
    hospitals and clinics are facing unprecedented pressure. Researchers at
    the University of North Carolina have identified almost 90 rural
    hospital closures across the country in just the last 8 years, and
    iVantage Health Analytics has reported that 673 other rural hospitals
    are at risk of closure due to mounting financial pressures.

        These hospitals are the epicenter of most of these communities, not
    just for health care but for community-wide economic stability. In
    addition, the dated reimbursement models and bricks-and-mortar approach
    to health care of yesterday are undermining these assets. Payment
    policies and well-intended policy reforms are overly sophisticated and
    bureaucratic. While the jury is out on whether these policies, which
    continue to quickly evolve, will work, it is highly likely most of the
    thought behind the policies is aimed at urban and higher density
    markets where much of the spending occurs. In my view, not enough
    thought has gone into how these policies weigh on smaller, non-urban
    and rural community assets. The fragmentation of payment and the weight
    of these policies undermine efforts to transition these rural assets
    into what is actually needed in these communities. One need look no
    further than the closings of hospitals, and the financial performance
    of the largest rural and non-urban hospital providers--both publicly
    traded and not-for-profit--to validate this point. We have before us a
    situation where it seems the only two options are: provide more funding
    for rural hospitals through convoluted formulas and one-size-fits-all
    rules, or let rural hospitals close.

        I firmly believe there are options in between these two extremes
    which can help sustain our rural and non-urban communities.

        Let's face it. Rural economies are continuing to struggle, and are
    not yet enjoying the full benefit of the recovery. According to the
    National Rural Health Association, only 3 percent of the job growth
    that has occurred since the Great Recession has happened in rural
    areas, and between 2010 and 2014, more businesses closed than opened in
    rural areas. Today across the Nation, rural and non-urban hospitals
    find themselves in negative feedback loops, increasingly leading to
    bankruptcy and closure. It starts with declining revenues caused by
    declining inpatient utilization rates. Combining declining inpatient
    use rates with stagnant or declining populations is a dangerous mix for
    a rural hospital or health system. Add to this mix the multitude of
    Federal and private insurer payment policies designed to contain or
    even reduce per-unit reimbursement, which remains tied to the fee-for-
    service system, and the hospitals lose the necessary revenue to service
    fixed costs. These hospitals have also amassed debt they must service,
    and the ongoing fixed costs of operating a hospital continue to grow.
    If the variable margins decline, the financial model simply does not
    work. Then, add to this scenario the highly complex changes being
    imposed by Medicare and Medicaid, and the cost of compliance, and you
    are left with hospitals that simply don't have a chance, particularly
    if they are not part of a larger health system. But even if they are
    part of a larger system, those same policies that undermine the
    financial health of the larger regional non-urban hospitals is
    beginning to lead to decisions to close or alter the relationships with
    rural hospitals. This very instance is playing out today in West
    Tennessee, where a regional not-for-profit system acquired a rural
    hospital, and closed it. The process of failure is familiar to us all.
    Inability to service fixed costs translates into reduced cash-flow,
    which negatively impacts employee and physician recruitment and
    retention, reduced investment into capital assets like newer equipment
    and technology, and eventually the decline of the physical structure
    itself.

        As these investments deteriorate, patients with means (and
    commercial insurance) travel to urban and suburban hospitals for
    orthopedic, cardiovascular and other procedures, which our current
    reimbursement system disproportionately rewards with higher margins.
    These margins are used by hospitals to offset losses in most other
    service lines of a hospital. Rural hospitals are thus left with a less-
    favorable case mix and payor mix, leading to further declines in
    revenue and margin.

        This is the death spiral.

        But, as I have stated, these hospitals don't have to close. There
    is another option. Transitioning these hospitals to what is needed
    today can be financially beneficial and can serve a major public health
    policy purpose. Today's rural hospital does not need to be providing
    high acuity intensive services or high acuity surgeries. Indeed, it may
    be better for patients to go to larger regional facilities that sustain
    the volume necessary to provide high quality intensive services. But,
    since 80 percent of our Nation's land mass is rural, access to many
    needed services is hampered by geography--this is geography that rural
    hospitals can help serve where serious service gaps exist. By building
    a bridge from yesterday's fee-for-service, bricks-and-mortar model
    focused on payment for each inpatient encounter or surgery to one where
    rural hospitals become the epicenter for the evolved needs of mental
    health, addiction services, primary care, chronic care for certain
    chronic conditions, obstetrics and neonatal care, emergency services,
    rehabilitation, specialty access through technology solutions, and
    other services, we can create new opportunities for revenue and job
    growth, and ultimately, we can serve the critical needs of these rural
    communities.

        The area of Southern Appalachia served by Ballad Health serves as a
    case study of sorts. As an example, just last month, I met with school
    superintendents from throughout our region. Many of these
    superintendents oversee rural school systems. These superintendents
    shared their serious concerns for students who are increasingly showing
    up for school in the fall with serious mental health issues, addiction,
    depression and suicidal tendencies. Their teachers don't possess the
    skills needed to manage the serious issues these students come to
    school with, and the school systems in rural areas certainly lack the
    resources to manage this problem on their own. Given the distant nature
    of the hospitals throughout the region, and the location of the
    schools, there is no easy solution, but there is a solution. The
    combination of the use of technology for assessment of these kids by
    qualified counselors who may not even live in those communities with
    the resources of the rural hospital to offer competent crisis services
    with a bridge to treatment makes perfect sense. But the payment system
    doesn't lend itself to supporting these costs or this model for rural
    communities.

        This is where Ballad Health, and its unique model, can be a bridge
    as the larger rural health policies evolve. The vast majority of the 29
    counties Ballad Health serves have flat or negative population growth.
    Our hospitals are also experiencing above-average declines in inpatient
    utilization rates. Sixty-seven percent of our payor mix is Medicare or
    Medicaid and another 6 percent is self pay. The fastest growing segment
    of our patients who are not paying are those who have insurance but
    cannot pay the higher deductibles. In addition, just as rural Americans
    are older and sicker than their urban counterparts, they also suffer
    higher rates of chronic disease such as heart disease, diabetes,
    obesity, substance use disorder, and untreated mental illness. Given
    the higher incidence of chronic conditions that make pregnancy more
    challenging in rural areas, it follows that rates of complications and
    maternal/infant deaths are higher, too. In 1985, 24 percent of rural
    counties lacked obstetric services. Today, 54 percent of rural counties
    lack hospital-based obstetric services. More than 200 rural maternity
    programs closed between 2004 and 2014. All of these issues are faced by
    Ballad Health and the rural communities we serve.

        While rural populations account for only about 20 percent of our
    Nation's population, they populate approximately 80 percent of our
    Nation's land mass. In some regions, this land mass is complicated by
    the significant geographic barriers and distance that make the
    provision of services even more difficult.

        These are some of the reasons our community leadership came
    together to create a new model of healthcare delivery. Formed only
    eight months ago by the merger of two competing health systems serving
    the same region for many decades, Ballad Health represents a
    transformation in the way we are approaching these challenges in our
    part of the country.

        Both legacy systems came to recognize that our status quo was no
    longer sustainable. While we separately invested millions of dollars in
    services and technologies designed to compete with the system down the
    road, our community was becoming less healthy, and our margins still
    continued to decline. We each recognized obtaining synergies of
    increased scale was imperative, yet selling our systems to larger
    outside hospital companies or systems would have likely resulted in the
    closure of some rural hospitals, the devastating loss of at least 1,000
    back-office jobs in our region, and as studies have shown happens, the
    larger systems would have likely increased pricing as they sought to
    leverage their size in negotiations with insurers and government
    payors.

        Unfortunately, Federal anti-trust policy in health care is solely
    focused on preserving competition, with little or no room to consider
    the effects of market failure on health and economic conditions in
    communities such as ours. Without this merger under state action
    immunity laws in Tennessee and Virginia, the hit to our region's
    economic stability would have been severe.

        Instead, we have begun the process of reducing resources tied up in
    destructive and costly duplication. We are redirecting at least $300
    million of these savings to preserve essential services and to invest
    in initiatives that reach further upstream of the emergency department
    or the doctor's office to help address the social determinants that are
    contributing to our region's poor health status.

        Our efforts are an attempt to build a bridge to the future of rural
    health care, but we will only succeed long-term if Federal and state
    policies support what we are trying to do. While other rural hospitals
    are closing, we have pledged to preserve our rural hospital facilities
    and to repurpose many of them so that additional essential services can
    be provided to our community.

        Referencing the conversation I had with our school superintendents,
    because Ballad Health retained its local governance and is a community-
    based organization, we decided to become a solution to the problem.
    Ballad Health intends to invest in counselors at our region's only
    children's hospital to do assessments of children in our schools in
    crisis. We plan to hire a counselor in each school district to serve
    those children identified with serious crisis needs. Unfortunately, the
    current payment system does not sufficiently support this model, but
    our commitment to the community is more important than profits.
    Eventually, the business model must support what we are investing in,
    and that's why I'm here today. This is an example where a system
    approach to genuinely improving healthcare services can benefit the
    communities in the region we serve, and we hope to show this is a model
    worth investing in. We would welcome a Federal investment into this
    model of partnership between rural schools and hospitals as we
    demonstrate how it can help solve many of our region's problems.

        Of course, this model relies upon our ability to attract and retain
    a high-quality and dedicated healthcare workforce. Seventy-seven
    percent of counties in our country are considered Health Professional
    Shortage Areas by the National Rural Health Association, and we are
    impacted by this as well. Our children's hospital struggles to attract
    and retain physician talent, and we are the only children's hospital
    within a 2-hour drive of many residents in our region. Again, a payment
    system that only rewards hospital admissions does not contribute to a
    successful healthcare delivery system in a region where admissions are
    declining. Instead, Federal and state policies should align to invest
    in needed services for underserved areas with an eye toward evolving
    existing facilities into centers of excellence for rural health care. I
    imagine a day when our children's hospital can serve children who are
    developmentally disabled or suffer from mental health or other
    behavioral challenges, and can participate in the type of research that
    will help solve future healthcare problems in rural areas. Our
    children's hospital has seen a rate of neonatal abstinence syndrome
    approximately four times greater than the national average, and we do
    not fully know what the impact of this will be on these children as
    they grow. Rural America is at the center of this problem. While urban
    communities typically have the depth and breadth of specialties
    necessary to address the issues in those communities and the research
    strength to obtain the funding required to study these issues, rural
    areas simply cannot sufficiently compete and participate.

        Because of the new model we have created and are funding, our
    region may receive a short reprieve, but many communities are unlikely
    to be as fortunate. According to the Chartis Center for Rural Health,
    40 percent of rural hospitals had negative operating margins in 2017,
    and this same study found that 44 percent of rural hospitals will have
    negative operating margins in 2018. Consistent with this trend, six of
    Ballad Health's 14 rural hospitals had negative operating margins in
    the fiscal year that just ended, in addition to two of our non-urban
    hospitals. We continue to subsidize these losses as we build toward the
    future. On top of this, Ballad Health provided more than $300 million
    in uncompensated care last year, leading to a system-wide operating
    margin of only 0.6 percent, or $12 million.

        Given these realities, I applaud the Members of this Committee for
    their continued leadership and efforts to facilitate passage of a
    comprehensive rural health care package before the end of the 115th
    Congress.

        Simply put, rural hospitals and physicians need a Federal
    regulatory and reimbursement environment that takes into consideration
    the unique circumstances faced by the hospitals and physicians serving
    the 20 percent of our population that lives in 80 percent of our
    country's geography. As this Committee considers a number of weighty
    issues related to health in rural areas, I would urge our policymakers
    to fundamentally reframe the way we think about rural hospitals and
    their role in their communities in two key ways.

        First, we should stop thinking about rural health services in terms
    of bricks-and-mortar facilities and start thinking in terms of the real
    health problems that need to be solved in these communities. The
    National Rural Health Association confirms that rural Americans suffer
    disproportionately from serious health issues like diabetes and heart
    disease, and they are disproportionately more likely to die from
    curable cancers or drug overdose. These are not problems that can
    easily be solved within a traditional bricks-and-mortar inpatient
    hospital, nor can they easily be solved within our country's current
    payment system.

        If we want to make a real impact on improving the health of
    Americans in rural areas, we need to identify the health services that
    are needed in those areas and then incentivize hospitals and health
    systems to come up with innovative solutions that fit their community's
    individual needs. We need to utilize the data we have available to
    identify the problems and then ask the rural hospitals to come to the
    table with solutions. We need to identify the cost of implementing
    these solutions and demonstrate the potential return on investment for
    the payor community and the public. This can be done. While there is
    significant up-front investment, the potential return on investment
    will be undeniable.

        These hospitals could benefit from renewable block funding tied to
    estimable costs, as opposed to the fee-for-service model that relies
    upon traditional service provision, to help create a bridge to what the
    rural hospital of tomorrow should be. This cannot only help address the
    real problems that exist in these communities, it can create new jobs
    and help identify new purposes for old assets. At Ballad Health, we are
    in the process of doing this with two of our rural hospitals in Greene
    County, Tennessee. By consolidating inpatient acute care services at
    one hospital, we will be able to use synergies gained through our
    merger to repurpose the other hospital to provide the critical
    outpatient services, behavioral health, rehabilitation, and drug
    addiction treatment that are so badly needed in the community. Rather
    than making the easy decision to close this rural hospital, thus
    costing 600 jobs, we have found an alternative beneficial use for it.
    Given the fact that these hospitals lost a combined $11 million in
    2017, and $31 million in 2016, this alternative solution, which is
    significantly better for the community, would only be possible within a
    comprehensive health system that is truly focused on the needs of the
    community it serves.

        This brings to me the other point I would like to make about
    reframing our thinking about rural hospitals. Providing the proper
    financial incentives for rural hospitals in order to help solve
    population health problems can help meet the health needs of our rural
    communities, but this will only work if these rural hospitals are able
    to remain open. As you consider factors that help sustain rural
    hospitals, I would urge you to consider the role that many tertiary and
    urban hospitals within a larger, diverse health system play in
    sustaining the rural system of care. Many rural hospitals do not
    operate on their own. They are often part of larger systems that rely
    on the success of the regional hubs for financial viability. This is
    true for Ballad Health. Fourteen of our 21 hospitals are in rural
    areas, and six of those 14 hospitals had negative operating margins in
    fiscal year 2018. Were it not for the margins of our tertiary
    facilities, our entire rural system of care would collapse. As you
    consider and construct the components of a rural health package, please
    keep in mind that some of the non-urban hospitals with a predominantly
    rural health system are often a lifeline for rural hospitals, and their
    importance should not be overlooked.

        One issue that can have a detrimental impact on both rural
    hospitals and the tertiary hubs that support them is the Area Wage
    Index. Our region of the country, like most others, suffers from a
    shockingly low Area Wage Index within Medicare. While our AWI is
    approximately 0.72, there are areas in the country with AWI in excess
    of 1.9. This is a zero-sum system where, despite having done employee
    wage increases every single year, our Medicare area wage index has
    continued to deteriorate, as political and other considerations have
    driven the wage index higher for some parts of the country. As other
    areas have experienced significant annual increases, ours has
    decreased. While the national average is supposed to be an AWI of 1.0,
    only 10 percent of the counties in the United States have an AWI that
    is greater than 1.0, while 2,600 counties have an AWI less than 1.0.
    This distribution is not right, and it punishes non-urban hospitals
    that in many cases are subsidizing the ongoing operation of rural
    hospitals, just as it penalizes the rural hospitals themselves. I
    mentioned that Ballad Health's operating margin last year was $12
    million, or a 0.6 percent margin. If there were a national floor
    established on the AWI of 0.874, as proposed by S. 397, it would
    generate a $30 million annual impact for Ballad Health. In Tennessee,
    healthcare providers in all 95 counties and all 12 core-based
    statistical areas (CBSAs) are reimbursed based on AWI that are less
    than 0.864, which is significantly less than the national average of
    1.0. I applaud the work of Chairman Alexander (R-TN), Senator Isakson
    (R-GA), Senator Warner (D-VA), Senator Brown (D-OH), Senator Shelby (R-
    AL), Senator Kaine (D-VA), Senator Roberts (R-KS), Senator Cassidy (R-
    LA), and Senator Jones (D-AL), many of whom are original co-sponsors of
    a bipartisan bill that Ballad Health encouraged be filed to help solve
    this problem. This bill, S. 397, the Fair Medicare Hospital Payments
    Act of 2017, while not under the jurisdiction of this Committee, would
    help save rural hospitals and would support the regional provision of
    care in non-urban America. The bill is cost-neutral and would not
    impact other legislative or regulatory adjustments, including the
    ``Frontier State Fix'' that established an AWI floor of 1.0 for North
    Dakota, South Dakota, Montana, Wyoming and Nevada. This legislation has
    been endorsed by the Tennessee Hospital Association, the National Rural
    Health Association, the Kentucky Hospital Association, the Louisiana
    Hospital Association, the Georgia Hospital Association, the Virginia
    Hospital and Healthcare Association, and the Alabama Hospital
    Association.

        I also believe our rural hospitals could benefit from Federal
    assistance in helping to build a bridge from the outdated fee-for-
    service, bricks-and-mortar model to one that is responsive to our
    Nation's current needs. Many rural hospitals either have debt
    precluding them from additional capitalization, or simply do not have
    sufficient resources to borrow the funds needed to build this bridge.

        Modernization to right-size and reconfigure assets based on the
    needs of the community often needs a capital investment in order to
    make the transition. Community needs may include additional high-
    quality diagnostics, emergency medical services, outpatient
    rehabilitation services, mental health services, substance abuse
    treatment services, dentistry services, and optical health services. I
    would like to note that I am not advocating for simply giving away
    money, as I do believe rural health systems have an obligation to
    demonstrate the return on such investments, both financially and in
    terms of public health benefits. These investments would be best made
    in concert with effective and efficient payment reform that moves away
    from pay-for-volume. A Medicaid program operating in South Carolina
    that provides incentive payments to health systems that acquire,
    improve, and operate rural facilities may be a good model for Congress
    to consider.

        I am concerned about possible policy proposals to repeal
    Certificate of Need requirements, which have been advocated for by some
    in Washington. Respectfully, I would argue that while many of us
    support a market-based approach, we should also acknowledge that
    picking and choosing the elements of the marketplace without addressing
    all of the necessary elements does not create a properly functioning
    market system. In a marketplace where more than 60 percent of care is
    provided in a price-prescriptive government model, private insurers
    reflexively copy government policies, and there is significant
    intrusion by both Federal and state governments invoking certain
    mandates onto providers, it is hard to imagine anyone suggesting that
    the delivery of health care services exists within a free-market.

        The suggestion that repealing Certificate of Need requirements in
    order to bring ``market forces'' to bear, in my view, will do more harm
    to our rural health system infrastructure than good. If we agree that
    integration of health care and better coordination would lead to better
    outcomes, then we must also agree that contributing to increased
    fragmentation in rural and non-urban communities will do harm. For
    instance, if Certificate of Need requirements were repealed, and a
    physician-owned surgery center or diagnostic center were opened in a
    rural community, based on current government rules and price setting,
    not only is there no free market, but an unlevel field has been
    established for competition.

        Under Federal law, a comprehensive hospital is not permitted to
    have physician ownership, and because of Stark Law regulations and
    anti-kickback provisions, a comprehensive hospital has very limited
    options for meaningfully integrating with physicians. While one
    competitor in the market enjoys full financial integration with
    physicians, including distribution of profits, which incentivizes
    physicians to reduce costs and increase utilization of the physician-
    owned facility, a comprehensive hospital is left without any such
    relationship. In addition, the physician-owned facility is exempt from
    Federal EMTALA and community-benefit requirements. When one competitor
    has physician investment, and that competitor is not required to serve
    the poor, nor does it have any other obligation to help address the
    population health needs of the community, the local market is simply
    not a level-competitive market. Pulling those limited resources away
    from the hospital in order to provide profits to the competing
    physician-owned, limited-service facility only undermines that
    hospital's ability to influence the other aspects of health in that
    community. If a rural or non-urban hospital loses its profitable
    services to a facility that has no obligation to help solve the mental
    health challenges in the region, then where will the resources come
    from for the rural hospital to invest in addiction care, mental health,
    or the other needed services? In this scenario, the hospital has been
    further diminished, and its survival or ability to thrive is undermined
    at the expense of profits for what is often an out-of-market company or
    financier.

        I believe there are strategies that can be deployed in rural
    markets where the relationship between the hospitals and physicians can
    be strengthened. In the old fee-for-service model, Stark Law
    regulations and anti-kickback provisions were designed to keep
    financial entanglements between doctors and hospitals from affecting
    care. In a pay-for-value environment, those same laws inhibit the very
    alignment needed between doctors and hospitals to reduce unnecessary
    care and focus resources on prevention and chronic-care management. If
    the payment system were to invest in rural hospitals that convert to
    these models, and rural hospitals were permitted to create financial
    alignment with physicians, then two things will happen. First, rural
    communities will become more attractive to physicians who would be able
    to diversify their income to include the upside benefits of the
    hospital's financial performance. Second, the financial and public-
    health success of the hospital, in alignment with the payment policies
    that support such a transition, would virtually ensure alignment
    between the physicians, hospital, and community as they seek to better
    manage chronic conditions, rather than simply wait until a reimbursable
    procedure is performed.

        Please consider the following real-world example. In one community,
    a rural hospital has general surgeons who perform a large number of
    amputations, most of which are necessary due to complications from
    diabetes. However, that community does not have an endocrinologist. The
    reason many rural hospitals do not have endocrinologists is that
    endocrinologists do not preform procedures at hospitals, and thus, they
    do not generate revenue. In fact, the practice would likely lose money,
    in addition to the very presence of the endocrinologist reducing the
    need for hospitalizations, which is an outcome diametrically opposed to
    the financial interest of the hospital. The general surgeons will see
    the diabetic patients who go without management of the chronic
    condition, and they will perform the amputations, which are services
    for which the hospital and doctor get paid. In addition, the hospital
    does an excellent job with rehabilitation services, which again, is a
    service for which the hospital is paid.

        However, there is an alternative: What if, noticing the high
    incidence of diabetes and amputations, the hospital, in a jointly
    established partnership with the physicians, chose to align and ask for
    an entirely different payment model, one that paid the hospital and
    physicians to invest in endocrinology services, reduce amputations, and
    better manage the diabetes in the population? In that scenario, better
    coordination occurs for the patient, the hospital and physicians may
    invest in technology and other innovative solutions for the management
    of the patients, and instead of only being paid when a procedure is
    performed, the hospital and physicians are compensated based on what is
    saved by the program.

        The margins for this model would be better because the resources
    would be more efficiently used. This is the essence of the bundled-
    payments model, but I believe integration in these communities should
    be able to go further than the basic concept of bundled payments.
    Infusing flexibility into the financial relationships between
    physicians and hospitals can have a very positive impact on both
    outcomes and cost in a pay-for-value environment. It is understandable
    that, in a fee-for-service environment, these relationships would be
    problematic. However, they have been freely permitted in many areas,
    such as diagnostics, outpatient surgery, and others. I believe
    integrated models that align hospitals and physicians would open the
    door to many exciting opportunities to reduce cost, eliminate variation
    that leads to waste and poor outcomes, and create more flexible models
    of tackling the management of chronic illness.

        These opportunities may exist, but physician alignment with
    hospitals must happen, and yesterday's Stark Law regulations and anti-
    kickback regulations must be modernized to create these opportunities
    for alignment. Holding onto fee-for-service reimbursement models and
    preventing hospitals from more closely aligning with doctors will only
    preserve the outdated models that are harming rural hospitals and the
    health of the communities they serve.

        Finally, I would like to address the need preservations of the 340B
    Drug Discount Program, which is a program of vital importance to the
    financial stability of our health system and our ability to serve
    vulnerable and low-income patients. While no program is free from the
    need for thoughtful reform, I would ask for your support in preserving
    340B program eligibility for rural and non-urban hospitals as well as
    children's hospitals.

        We rely on these drug-acquisition savings to enable us to support
    the provision of care in struggling rural areas. The estimated value of
    the 340B program to Ballad Health in fiscal year 2019 is approximately
    $53 million. Again, considering the fact that our total operating
    margin of 0.6 percent led to only $12 million in operating surplus last
    year, losing access to the savings produced by participation in the
    340B Drug Discount Program would be devastating for our health system
    and the patients and communities we serve.

        Even with our participation in the 340B Drug Discount Program,
    Ballad Health's annual drug spend continues to increase by over 8
    percent annually. Without 340B participation, our drug costs would be
    completely unsustainable. Reforming the 340B Drug Discount Program
    should not come at the cost of bankrupting vitally important hospitals
    and health systems. We stand with you in attempting to properly and
    thoughtfully reform the 340B Drug Discount Program, but we must ensure
    that programmatic reform does not inadvertently devastate rural
    hospitals and children's hospitals across our Nation.

        Much of what I have presented represents a major departure from 60
    years of evolution in our health system. However, I believe such major
    shifts in policy are important, and effective reform cannot be achieved
    on the margins. This is why the very creation of Ballad Health
    happened, and it is why our region's major employers and every
    municipal government and chamber of commerce in our region encouraged
    and supported the merger that created Ballad Health under the doctrine
    of State Action Immunity from Federal anti-trust law, even against the
    strenuous opposition by staff of the Federal Trade Commission. It is
    why the legislatures of the states in which we operate unanimously
    approved the structure of the merger under exemption from Federal anti-
    trust law, and it is why two Governors--a Democrat and a Republican--
    signed the legislation and authorized the merger under the advice and
    guidance of each state's attorney general.

        In short, there is a pent-up demand for trying something different.
    Ballad Health took the risk and the important step of suggesting that
    we want to be part of the solution rather than simply complaining about
    the problem. We stand ready to be a laboratory for our Federal partners
    to help solve problems, and we stand ready to test new ways of changing
    the landscape of health care. Hopefully, this is just the beginning of
    the dialog.

        Again, I greatly appreciate the invitation and opportunity to
    participate in today's hearing, and I look forward to your questions.
                                     ______

        Senator Enzi. Thank you.
        Dr. Richter.

       STATEMENT OF DEBORAH RICHTER, M.D., FAMILY PHYSICIAN AND
     ADDICTION MEDICINE SPECIALIST, AND CHAIR, VERMONT HEALTHCARE
                         FOR ALL, CAMBRIDGE, VT

        Dr. Richter. Good afternoon, Chairman Enzi and Members of
    the Committee. My name is Deborah Richter----
        Senator Enzi. Hold the mic closer.
        Dr. Richter. I can probably turn it on.
        My name is Deborah Richter. I'm a practicing family
    physician in rural Vermont, and I also have an addiction
    medicine practice in Burlington. I want to thank you for asking
    me to participate in this roundtable.
        I'm particularly interested in examining experiences
    because I see the inadequacies of our healthcare system every
    day in my practice. Regarding the subject of cost, however, I
    wonder whose costs we're referring to, because when I think of
    cost, it is mostly in reference to system costs; that is, how
    much the U.S. spends on healthcare in total. This year it is
    projected we will spend $3.5 trillion on healthcare. And as
    you've heard many times from Senator Sanders, we spend on
    average twice per capita what other countries spend, all of
    whom cover everyone while enjoying a longer life expectancy and
    better health outcomes.
        In every other industrialized country, healthcare is
    considered a public good. There are many reasons we spend more
    per capita on healthcare, not the least of which is our
    enormously complex financing system which consumes 31 percent
    of total healthcare costs. Much of these costs are necessary
    under a multiple-payer system where each payer has different
    rules, regulations, and levels of reimbursement. But under a
    one-payer, publicly funded, universal system such as the one
    embodied in Senator Sanders' Medicare for All Bill simplified
    billing and administration could be reduced by $500 billion by
    some estimates.
        There have been multiple studies showing that the current
    spending is more than enough to cover all Americans with
    comprehensive coverage without spending in total one penny
    more. So if we then focus on payer cost, this would include the
    taxpayer for two-thirds of financing of healthcare, because if
    you include Medicare, Medicaid, the VA, public employee health
    insurance, and the tax subsidy for private employers to pay for
    health insurance for their employees, that equals two-thirds of
    how we're paying for healthcare. The remainder comes from out-
    of-pocket payments from the public employers paying for private
    health insurance.
        But we must acknowledge that ultimately every penny comes
    from Americans' pockets, Americans' households. Taxes, out-of-
    pocket payments, higher prices for goods and lower wages--if
    our employer pays for health insurance, it all comes from us.
        But there are other costs to the lack of a healthcare
    system. Those are the ones I witness every day. I will give you
    a few examples from my practice alone in the past year. I am
    one physician among thousands, and I can give you dozens of
    examples. If you do the math, it's not hard to see how 37,000
    patients die from lack of insurance every year. I'll give you
    three examples.
        An uninsured 60-year-old delayed seeking care despite being
    unable to swallow solid food and losing 100 pounds. And then 18
    months later, after he couldn't stand it any longer, he finally
    sought care and was diagnosed with Stage IV esophageal cancer.
    It was not treatable, and he has since died.
        An uninsured 40-year-old woman several weeks ago, actually
    several months ago, with a large mass in her breast, delayed
    seeking care for a year until the mass started to bleed. She
    has an aggressive form of breast cancer. She is now undergoing
    treatment. Mind you, she was uninsured. She was working. She
    now has Medicaid. A very aggressive form of cancer, though,
    which she delayed for a year.
        Then there was a 52-year-old I saw about a year ago who was
    suffering from severe shortness of breath. This went on for 4
    days. She thought it was her asthma and she delayed seeking
    care, and it turns out it was an acute myocardial infarct, a
    heart attack. She spent 3 days in the ICU. She had insurance
    but had a deductible.
        The uninsured and underinsured are more likely to die from
    preventable illnesses than their insured counterparts, and many
    of them who delay care, like the ones I mentioned, incur much
    higher costs than they would had they sought care earlier. I
    need not mention the human cost of these tragic cases.
        We can't ignore the economic cost of the way we finance
    healthcare in our country, however. The patient with the breast
    mass was saving to build a house with her fiance. She couldn't
    afford to do that and pay for health insurance. Millions of
    people make these economic decisions every day. When they do,
    the economy suffers. We are a consumer-driven economy, so the
    economic multiplier effect to this regressive way we finance
    healthcare is affecting us all.
        I have only 48 seconds. I'd like to also mention that the
    problems with our current healthcare system are magnified in
    rural America, as we've heard already, because we are older,
    sicker, and poorer. That is particularly true of the impact of
    the opioid epidemic, as we've heard. The majority of these
    programs are funded through taxes, mainly Medicaid programs,
    but the problem is straining rural health systems' ability to
    respond.
        When we're looking at ways to reduce healthcare costs, I
    would urge us to look at the primary care shortage. That's
    something we all seem to have agreed on, and we can discuss
    that. I'd be happy to talk about that. But I do think unless we
    look at the system as a whole and look at it as a public good
    where we include everyone, and look at the solution to include
    everyone, we will not solve these problems.
        Thank you.
        [The prepared statement of Dr. Richter follows:]
                     prepared statement of deborah richter
        Good Afternoon Chairman Enzi and Members of the Subcommittee on
    Primary Health and Retirement Security. My name is Deborah Richter. I
    am a practicing family physician in rural Vermont and I also have an
    addiction medicine practice in Burlington VT. I want to thank you for
    asking me to participate in the roundtable discussion of ``Health Care
    in Rural America: Examining Experiences and Costs.''

        I am particularly interested in the topic examining experiences
    because I see the inadequacies of our health care system every day.

        Regarding the subject of costs however, I wonder whose costs we are
    referring to?
    When I think of costs mostly it is in reference to system costs, that
    is, how much the U.S. spends on health care in total. This year it is
    projected we will spend $3.5 trillion on health care. \1\ As you've
    heard many times, we spend on average twice per capita what other
    countries spend. \2\ All of whom cover everyone while enjoying a longer
    life expectancy and \3\ better health outcomes. \4\ In every other
    industrialized country health care is a public good.
    ---------------------------------------------------------------------------
        \1\  Centers for Medicare and Medicaid Services, 2018.
        \2\  Organization of Economic Cooperation and Development (OECD),
    2018.
        \3\  OECD, 2018.
        \4\  OECD 2018.

        There are many reasons we spend more per capita on health care not
    the least of which is our enormously complex financing system which
    consumes 31 percent of total health care costs. \5\ Much of these costs
    are necessary under a multiple payer system where each payer has
    different rules, regulations and levels of reimbursement. But under a
    one payer publicly funded universal system such as the one embodied in
    Senator Sanders' Medicare for All bill, simplified billing and
    administration could be reduced by $500 billion. \6\ There have been
    multiple studies showing that we are spending more than enough money to
    cover all Americans with comprehensive coverage. \7\
    ---------------------------------------------------------------------------
        \5\  Woolhandler, S., Campbell, T., Himmelstein, D., ``Costs of
    Health Care Administration in the United States and Canada'' NEJM, Aug,
    2003.
        \6\  Woolhandler, S., Himmelstein, D., ``Single-Payer Reform: The
    Only Way to Fulfill the President's Pledge of More Coverage, Better
    Benefits, and Lower Costs'', Annals of Int. Med., April, 2017.
        \7\  How Much Would Single Payer Cost; A Summary of Studies
    Compiled by Ida Hellander, http://www.pnhp.org/facts/single-payer-
    system-cost.

        If we then focus on payer costs this would include the tax payer
    for 2/3 of the financing of health care, \8\ Medicare, Medicaid, the
    VA, public employees' health insurance and the tax subsidy for private
    employers to pay for health insurance for their employees. The
    remainder comes from out of pocket payments from the public and
    employers paying for private health insurance. But we must acknowledge
    that every penny ultimately comes from Americans' pockets. Taxes, out
    of pocket payments, higher prices for goods and lower wages if our
    employer pays for health insurance all come from us.
    ---------------------------------------------------------------------------
        \8\  Woolhandler, S., Himmelstein, D., ``Paying for National Health
    Insurance and Not Getting It'', Health Affairs, Vol 21. No. 4, 2002.

        But there are other costs to the lack of a health care system.
    Those are the ones I witness every day. I will give you a few examples
    from my practice alone in the past year. I am one physician among
    thousands and I can give you dozens of examples. If we do the math it
    is not hard to see how 37,000 patients died from lack of insurance. \9\
    ---------------------------------------------------------------------------
        \9\  Woolhandler, S., Himmelstein, D., ``The Relationship of Health
    Insurance and Mortality: Is Lack of Insurance Deadly?'', Annals of Int
    Med, Sept, 2017.

    ---------------------------------------------------------------------------
        Three examples:

            (1) An uninsured 60-year-old delayed seeking care despite being
            unable to swallow solid food and losing 100 pounds. Eighteen
            months later he was diagnosed with Stage 4 esophageal cancer.
            He has since died.

            (2) An uninsured 40-year-old woman with a large mass in her
            breast delayed seeking care for a year until the mass started
            to bleed. She has an aggressive form of breast cancer.

            (3) A 52-year-old woman suffering from severe shortness of
            breath delayed seeking care due to mounting health care bills
            from another family member. She was working full-time. They
            have a $5000 deductible.

        The un- and underinsured are more likely to die from preventable
    illnesses than their well insured counterparts. And many of them who
    delay care like the patients mentioned above, incur much higher costs
    than they would have had they sought care earlier. I need not mention
    the human cost of these tragic cases.

        We also can't ignore the economic cost of the way we finance health
    care in our country. The patient with the breast mass was saving to
    build a house with her fiance. She couldn't afford to do that and pay
    for health insurance. Millions of people make these sorts of economic
    decisions every day. When they do, the economy suffers. We are a
    consumer driven economy so there is an economic multiplier effect to
    the regressive way we finance health care.

        I would like to also mention that all of the above problems with
    our current health care system are magnified in rural America as they
    are older sicker and poorer. \10\ This is particularly true of the
    impact of the opioid epidemic which started in rural America. \11\ The
    Centers for Disease Control and Prevention (CDC), find that the rate of
    death from opioid-related overdoses is 45 percent higher in rural vs
    urban areas.
    ---------------------------------------------------------------------------
        \10\  Wagnerman, K. ``Health Care in Rural and Urban America''.
    Georgetown University Health Policy Institute, Oct., 2017.
        \11\  Toliver, Z, ``The Opioid Epidemic: Testing the Limits of
    Rural Healthcare'', Rural Health Information Hub, May 2016.

        The majority of treatment programs are funded through taxes--mainly
    Medicaid programs. But this problem is straining rural health systems
    ability to respond. Many patients wait months to get treatment for
    substance abuse, some give up trying. There are also indirect costs to
    opioid use disorder. The foster care system is bursting at the seems.
    \12\
    ---------------------------------------------------------------------------
        \12\  Stein, P., Bever, L., ``The Opioid Crisis is Straining the
    Nation's Foster Care System'', Washington Post, July 2017.

        Other costs include corrections costs which again are greater on a
    per capita basis in rural vs urban America. \13\
    ---------------------------------------------------------------------------
        \13\  Sullivan, R., ``The Fiscal Impact of the Opioid Epidemic in
    the New England States'', New England Public Policy Center, May 2018.

        When we are looking to reduce health care costs now and in the
    future we must first address the primary care shortage. Primary care
    represents most of the medical office visits in any one year. \14\ In a
    nutshell primary care is most of the care to most of the people most of
    the time. Yet we represent less than 8 percent of total costs. \15\ We
    know that when a population has free access to primary care, people
    live longer and they cost the system less. \16\ As you must know there
    is a severe shortage in primary care particularly in rural and poor
    communities. \17\ Much of this is due to an aging workforce with 1/4
    over the age of 60 in 2017. \18\ With fewer medical students choosing
    primary care we will see this shortage worsen by 2025. \19\ In addition
    demand has increased due to an aging population and with the expansion
    of the ACA. Added to that, the burnout rate in primary care is causing
    physicians to retire earlier than they might have. \20\
    ---------------------------------------------------------------------------
        \14\  Center for Disease Control, National Center for Health
    Statistics, 2015.
        \15\  Koller, C., ``Getting More Primary Care-Oriented: Measuring
    Primary Care Spending'', Milbank Memorial Fund, July 2017.
        \16\  Friedberg, M., et al,''Primary Care: A Critical Review of the
    Evidence On Quality And Costs of Health Care'', Health Affairs, Vol 29,
    No. 5, May 2010.
        \17\  Petterson, S., et al, ``Unequal Distribution of the U.S.
    Primary Care Workforce ``, American Family Physician, June, 2013.
        \18\  Petterson S, McNellis R, Klink K, Meyers D, Bazemore A. The
    State of Primary Care in the United States: A Chartbook of Facts and
    Statistics. January 2018.
        \19\  Petterson, S., et al, ``Projecting US Primary Care Physician
    Workforce Needs 2010-2025'', Annals of Family Medicine, 2012.
        \20\  Pechham, C., Medscape National Physician Burnout & Depression
    Report 2018, Jan., 2018.

        As a practicing family physician I can see why physicians are
    burning out. The administrative burden placed on us when dealing with
    multiple payers with different rules, regulations and reimbursements
    would drive anyone mad. Doctors report that for every hour of patient
    care they spend an hour with administrative tasks. If we have any hope
    of rescuing this dying profession we had better address the
    ---------------------------------------------------------------------------
    administrative burden facing our primary care practitioners.

        In sum, as a physician who has practiced in the US health care
    system for the past 30 years I would say that in my experience, unless
    we address the system as a whole we will not solve any of the pressing
    problems in health care. We need to regard health care as a public good
    and make it accessible to all. We have wonderful health professionals
    and hospitals in this country. We are spending enough money.

        We need a program of expanded Medicare for All Americans.
                                     ______

        Senator Enzi. Thank you.
        I want to thank the whole panel not only for what you said,
    but also for what testimony has been submitted. A lot of good
    ideas in there. We'll have to probe some of those a little bit
    more. Some we may have to grow a little bit more. But as a
    roundtable we'll ask some specific questions, and then I'm
    going to--since I'll be here for the whole thing, I'm going to
    defer until the end and give Senator Alexander an opportunity
    to ask questions in my place to start the discussion. Again, if
    there's a question asked and you want to add to it, stand your
    name tag on end there. This is a roundtable. It's to gather
    information, not to hound on a point.
        The Chairman. Thank you. Thanks, Mr. Chairman. Thank you
    for your leadership in calling this hearing on healthcare in
    rural areas.
        Mr. Levine, welcome, glad to have you here, appreciate what
    you do in the Upper East Tennessee area. As you indicated, it
    affects both Tennessee and Virginia.
        You mentioned a couple of things I'd like to go back to.
    Tennessee is second in the country in terms of rural hospital
    closings. The first thing I'd like to ask you about is the area
    wage index. Fifty-five hundred hospitals in the country
    received payments from Medicare based upon a formula called the
    area wage index. I met with a group of hospitals yesterday
    morning in the Knoxville area who were talking about how low it
    was, how unfair it is to certain parts of the region.
        How big a problem is it for you in Tennessee and Virginia,
    the area wage index, and do you have any suggestions for fixing
    it?
        Mr. Levine. Senator, it is one of the biggest problems we
    have. All 95 counties in Tennessee and all the counties in
    Southwest Virginia fall among the lowest on the spectrum for
    the area wage index, which ranges anywhere from a low of .68
    all the way up to 1.9. And if you think about the distribution,
    only 10 percent of the counties in the country have an area
    wage index. The average is supposed to be 1. Only 10 percent of
    countries have an area wage index above 1. Eighty percent are
    below 1.
        The distribution--the intent of the area wage index was to
    recognize initially that costs were higher in rural areas, and
    therefore you'd have to pay more to get people there, and
    somewhere along the way it got turned on its head. And once you
    fall behind----
        The Chairman. I've got limited time. It's hard to change
    formulas in the U.S. Congress. Do you have any shrewd
    suggestion for how we might do that?
        Mr. Levine. Pass Senate Bill 397, the Fair Medicare
    Hospital Payments Act, which is initially sponsored by Senator
    Isakson, Senator----
        The Chairman. I'm a co-sponsor of that.
        Mr. Levine. Yes, you are, and Senator Kaine is, and others
    here are as well, Senator Roberts. It's a bipartisan bill that
    would be the single biggest thing near-term you could do to
    help rural hospitals.
        The Chairman. If I could switch to another thing you
    mentioned, I visited Lewis County in Tennessee, and they had a
    big argument about closing their hospital and eventually did it
    and created instead a community health center. It's a big
    success. It's owned by a nearby hospital, and the theory is you
    don't need to do heart transplants in every small rural county.
        What are your suggestions for alternative models for
    delivering healthcare services in rural counties? If I were
    trying to put a plan to Lewis County in Tennessee where that
    community health center is, I would be very impressed because
    you can walk in between 7:00 in the morning and 8:00 at night,
    there's always a couple of doctors there, it's clean, and if
    you have a real problem, they can get you pretty quickly
    somewhere else. But 90 percent of the problems that people walk
    in with they can deal with. What about alternative models?
        Mr. Levine. That's exactly the same thing we're doing in
    Upper East Tennessee and Southwest Virginia. There's
    opportunities to repurpose rural hospitals. Again, instead of
    being full-service acute care hospitals which provide every
    service like they used to, look at what the service needs are
    in those communities now: mental health, addiction, emergency
    medicine, high-quality diagnostics, maternal care. The payment
    system doesn't right now really support those things, and I
    think if we were to build a bridge, it would be to transform
    the payment system so rural hospitals can afford to repurpose,
    and then you can sustain those services through an alternative
    payment system to support them.
        The Chairman. Mr. Chairman, I'll give my time back to you
    or to other Senators so we can have more of a conversation.
        Senator Enzi. Mr. Glause, you wanted to speak on that as
    well? Turn your mic on, please.
        Mr. Glause. Thank you. I would encourage us to be mindful
    of unintended consequences as we look at repurposing rural
    hospitals. The cost of air ambulance transport has skyrocketed.
    Most of our air ambulance transports in Wyoming are between
    facilities, and the states have no ability to regulate those
    rates or routes of their air ambulance company. So I would
    encourage you to also look at that issue when the
    reauthorization of the Federal Aviation administration comes
    up.
        Senator Sanders. Mr. Chairman.
        Senator Enzi. You're next.
        Senator Sanders. I think there is general agreement that we
    have a shortage of physicians in the country and in rural
    America in particular. Under the much-maligned Affordable Care
    Act, we doubled funding for federally qualified community
    health centers, as well as a significant increase in funding
    for the National Health Service Corps, which is, as you know, a
    program that provides debt forgiveness for those doctors and
    dentists who practice in underserved areas.
        Would each of you be supportive of a significant expansion
    of the community health center program and the National Health
    Service Corps? Mr. Glause.
        Mr. Glause. Thank you, Senator Sanders. Generally, the
    answer is yes. We see a significant lack of providers in
    Wyoming, and we need to address that issue, especially in rural
    America. The doctors and----
        Senator Sanders. I apologize and ask you to be brief.
        Mr. Reed.
        Mr. Reed. I'd echo what Mr. Glause said, which is in
    principle, yes. I want to make sure that we don't have any
    provisions in there that limit or restrict the use of digital
    medicine and the ability for remote patient monitoring.
        Senator Sanders. Mr. Levine.
        Mr. Levine. Yes. Plus, I would look at funding additional
    residency slots that are based in rural communities.
        Senator Sanders. Good.
        Dr. Richter. I would absolutely favor that.
        Senator Sanders. Okay. I don't go to a lot of these
    hearings because there's something disingenuous that takes
    place. Everybody here and every Senator and panelist is
    concerned about, in this case, rural health care, but many of
    my colleagues voted to cut $1 trillion in funding over a 10-
    year period to Medicaid, and $500 billion to Medicare.
        Mr. Glause, just out of curiosity, if the President's
    budget or the Republican budget were approved, which cut $1
    trillion in funding for Medicaid over a 10-year period, what do
    you think that would do to--what impact would that have on
    rural Wyoming? A hundred billion a year for 10 years.
        Mr. Glause. We have to consider the difference between
    Medicare and Medicaid.
        Senator Sanders. I'm talking about Medicaid funding, a
    trillion dollars over 10 years in the Republican budget cut.
        Mr. Glause. We have not expanded Medicaid in Wyoming, as
    you all know. I don't think that we would see the substantial
    impact with a cut to Medicaid as we would other programs.
        Senator Sanders. Okay. I apologize again.
        Mr. Reed. A trillion-dollar cut over 10 years; would it
    help rural America?
        Mr. Reed. Frankly, I'm really focused on whether or not any
    cut or any improvement in the budget actually allows doctors to
    use the tools that will improve their ability to provide care
    to folks.
        Senator Sanders. You have no comment? You don't think a
    trillion-dollar cut would have any impact on rural America?
    Okay.
        Mr. Levine, a trillion-dollar cut?
        Mr. Levine. I do think a cut to Medicaid would have an
    impact on rural healthcare. But Tennessee has a very unique
    problem because its disproportionate share funding is capped in
    Federal statute. So Tennessee's got a very unique problem where
    the state, the hospitals are willing to come up with the money
    to bring the Federal money down.
        Senator Sanders. Doctor, a trillion-dollar cut in Medicaid
    to rural America?
        Dr. Richter. We're already suffering under underpayment as
    it is, and particularly in primary care, and even worse so in
    mental health. A trillion-dollar cut would be devastating to
    us, and I think we would see even more physicians and nurse
    practitioners exiting rural areas. I think it would be tragic.
        Senator Sanders. Somebody, I think it was Mr. Glause,
    mentioned that Medicare reimbursement rates are about 65
    percent, of course, which I understand to be true. My
    understanding also is that private insurance reimbursement
    rates are actually lower. Comment on that. I was just speaking
    to some doctors actually in the Burlington Community Health
    Center there. They were telling me that Medicare was the
    highest that they got, not good but better than Medicaid,
    better than Blue Cross Blue Shield, which are much lower.
    Thoughts on that? Mr. Levine, is that accurate?
        Mr. Levine. No, and in our market in Upper East Tennessee
    and Southwest Virginia, generally for the hospitals, commercial
    insurance reimburses higher than Medicare. If they didn't, we
    would be in a lot of trouble.
        Senator Sanders. Okay, that's interesting. I don't think
    that's the case in Vermont.
        Dr. Richter.
        Dr. Richter. Well, in terms of Medicare and in terms of my
    addiction practice, Medicare is on par with Medicaid. It is
    actually private insurance that is actually the lower payers in
    the addiction world.
        Senator Sanders. That's true. That's in Vermont. I don't
    know if that's true nationally.
        Mr. Reed, what's the story there?
        Mr. Reed. That's a little bit outside my scope. But I would
    notice that with Senator Kaine here, we have the Center for
    Telemedicine out of UVA, and one of the things you're looking
    at is how do you actually take the reimbursement that goes on
    for the communities they serve in rural Virginia? The problem
    they're finding is they are actually able to deliver the same
    quality of care. For example, getting medication in the case of
    a stroke just as timely as you would if you were next door to a
    healthcare facility. But the reimbursement doesn't put money
    back in their pocket.
        Senator Sanders. Right, that's a valid point.
        Mr. Glause, what about you mentioned Medicare providing
    reimbursement rates only 65 percent of the cost. In Vermont,
    actually, private insurance reimbursement rates are lower.
    What's the case in Wyoming? Is that the case there or not?
        Mr. Glause. No, that's not the case, Senator Sanders. We
    see a lot of cost shifting to the private market.
        Senator Sanders. Private insurance reimbursement rates are
    higher than Medicare in your state?
        Mr. Glause. Absolutely.
        Senator Sanders. That's interesting. Okay, Okay.
        Thank you, Mr. Chairman.
        Senator Enzi. Thank you.
        I guess Senator Roberts left.
        Senator Bennet.
        Senator Bennet. Thank you.
        Just a follow-up to one of Senator Sanders' questions on
    the Medicaid cuts. In many of my rural districts, 50 percent or
    more of the kids are on Medicaid. What would happen to them if
    there was the kind of cut that he described to Medicaid, Mr.
    Glause? These are counties that don't have other insurers, many
    of them.
        Mr. Glause. Thank you, Senator Bennet. First of all, I will
    have to make a disclaimer. I am not an expert on Medicare and
    Medicaid. We don't deal with those issues routinely in the
    insurance department, but there is some overlapping of the
    issues.
        As far as the children suffering effects if the money was
    reduced for Medicaid, I think that we do have other programs in
    Wyoming for the children as far as the ability to obtain care
    through insurance for them.
        Senator Bennet. Thank you, Mr. Glause.
        Mr. Levine.
        Mr. Levine. Yes, sir. I think one of the things that's a
    problem here is the differentiation. There used to be a great
    differentiation between Medicaid and insurance. But in the last
    five or 6 years, we've seen a major shift with even private
    insurance where even if a child or an adult has private health
    insurance, because of all of the high deductibles, many of them
    are not able to pay. And what's happening to us is our biggest
    increase in bad debt and uncollectible revenue isn't the
    uninsured. It's people who have insurance----
        Senator Bennet. That's very common, right.
        Mr. Levine. It's one of the biggest single problems we
    have.
        Senator Bennet. I hear about that a lot. I was in a county
    right next door to my neighbor's state the other day in
    Northern Colorado that's the size of Delaware geographically,
    but 1,300 people live there, as opposed to a million people in
    Delaware. And as we had this conversation it became clear in
    the room that of everybody in the room, there were only three
    people that had insurance. One was the school principal, who
    got it through the district. One was the county commissioner,
    who said that he didn't have it until he got elected county
    commissioner, and now he has health insurance. And then there
    was one person who had managed to get it for herself, although
    her husband and her child--and these were all working people. I
    mean, they were people running the restaurant in town, 50 hours
    a week he was working, and his wife was working 50 hours a
    week, and literally they can't buy health insurance in America.
        This is one of the reasons Senator Kaine and I have offered
    the bill--I don't know if any of you have seen it, this
    Medicare X bill that suggested maybe what we need is a real
    public option that would be administered by Medicare. It starts
    in rural counties in our country that have one or fewer
    insurers.
        By the way, in Medicare Part D, a public option was
    included as part of that. It never was actually triggered. But
    it would allow people all across the country to pool and buy
    this insurance through a premium that they would pay. CBO says
    it would actually save the government money. And then over two
    or 3 years, I guess over 3 years, we'd make it available to
    everybody in America.
        Does that sound like a terrible idea to you guys, or do we
    need some option like that? Because no private insurer is going
    to sell insurance that's worth anything to the people in this
    county. There's just not enough lives here to do it. Even if
    you aggregated the number of people in my state, they wouldn't
    do it, except, Mr. Levine, in the way that you described, with
    impossibly high deductibles and other kinds of things that make
    the insurance, as people in these counties say to me, worthless
    to them.
        Do you have any reaction to the idea of a public option
    like that as a way of solving this? Anybody?
        Dr. Richter. I have a reaction to the idea of us giving
    first-dollar coverage to all Americans for primary care. We do
    know that it's less than 8 percent of total. It's the best
    bargain in medicine. And we also know that it's the only sector
    of healthcare to improve population health when it's freely
    accessible to a population. It's been shown to reduce
    mortality, to lower infant mortality, maternal mortality,
    increase life expectancy, all of those things.
        It seems to me we should start where the basics are, and we
    should make sure that no one does not go to the doctor because
    they have a co-pay or a deductible. People like this women, 4
    days short of breath, ended up with a massive heart attack.
    This I see all the time, or these co-pays and deductibles. And
    particularly when we're dealing with young children and their
    parents avoiding bringing them to the doctor. They end up with
    long-term disabilities as a result.
        That, to me, seems to be where we should start. It's a very
    small price tag for a big payout.
        Senator Bennet. I have 2 seconds left, I think.
        Mr. Reed. Sorry. It was fascinating to listen to you talk
    about how do you get this to work in a community of 1,300
    people, right? So there's not a professional there. How do you
    actually get the physician to engage with them? And as the
    doctor just noted, if you don't have that person engaged early
    in the process, then they get really sick and they cost a
    fortune. Then you're talking about amputations in the case of
    diabetes.
        University of Mississippi Medical Center is such an
    interesting story because they had to serve communities in the
    Delta and other areas where there is, like you, no health care
    professionals at all, a culture where there hasn't been the
    attention paid to diabetes that's necessary. And what they're
    finding to reduce cost to get to where you need to go is, hey,
    you need to get people educated about don't have that next
    slice of pecan pie, with all apologies to Tennessee.
        How do you engage with them? How do you monitor what their
    glucose level was in advance of them getting terribly, terribly
    sick? So if you want to treat the 1,300 people, you need to
    figure out how do you treat the 1,200 people that need to stay
    healthy so that you can use the primary dollars for the 100
    that are already sick and that you need to take care of. I
    think the doctor hinted about it, in preventive medicine. So
    let's look at a way to open up that CBO scoring window so we're
    not stuck with serving only the sickest people when they're the
    most expensive.
        Mr. Levine. May I, Mr. Chairman?
        Senator Enzi. Please.
        Mr. Levine. You know, I think the challenge here is when
    there's a discussion about a larger single-payer model, the
    thing that concerns me is payment policy matters to the
    marketplace. When you have, in our case, 70 percent of our
    reimbursement dictated to us by a central planner somewhere in
    Washington that doesn't know our economy, doesn't know our
    local markets, what ends up happening is that the payment
    system isn't reactive to what the market demands are for the
    physician. So physicians leave, and they go where they can get
    paid more. It's simple economics.
        There have been a lot of ideas historically thrown around
    about catastrophic coverage, which then would create more
    certainty and a more robust insurance market underneath
    catastrophic coverage. I think there are market-driven ways
    that you can create options for insurance with wraparounds for
    primary care and prevention, and then catastrophic on top of
    it. But I just worry about anything where you have centralized
    price setting that doesn't respect the differences in the
    markets and allow a negotiation in the marketplace to occur.
    Otherwise, you just keep losing doctors, because payment policy
    does affect the marketplace.
        Senator Bennet. I'm out of time, but I guess what I would
    say about that, I think all of these are great ideas. I'm very
    happy the Chairman had this Committee hearing. That doesn't
    solve Dr. Richter's issue about how do you get people the
    primary care they need so that we're not driving the prices, to
    say nothing of their own health care.
        The good news in all this, Mr. Chairman, is we're spending
    more than a third more money on a health care system that
    doesn't work for most Americans than all of our competitors are
    spending. So if we could agree on how to take that money and
    use it in ways that could elevate health outcomes, I think we'd
    be heading in the right direction and there would be a lot to
    cheer about in rural America, and urban America.
        Senator Enzi. Thank you. That's what we're searching for.
        Senator Hassan.
        Senator Hassan. Thank you, Senator Enzi.
        I never knew that Manchester, New Hampshire being 150,000
    people would sound so large.
        [Laughter.]
        Senator Hassan. I listened to you and Senator Sanders, and
    all of a sudden we're a metropolis.
        But I am also very grateful to all four of you for being
    here.
        To echo a little bit of what some of my colleagues have
    said, I believe health care is a right. It's also just an
    essential. We can't function without it. Our workforce can't be
    healthy without it. Our employers can't have a workforce
    without it. Our economy won't work without it. So I think it's
    really important that we continue to drill down on how we make
    sure everybody has health care in the United States of America.
        I had two questions particular to health care in our most
    rural areas, and the first is really about maternal health
    care. In New Hampshire, it's one of the things we struggle
    with, especially up in our North Country, which is about the
    top two-thirds of our geography, with about 50,000 people in
    that very large space.
        According to the American College of Obstetricians and
    Gynecologists, rural women have poorer health outcomes and less
    access to care than urban women do, especially when it comes to
    women's health providers. This can be, obviously, a tremendous
    problem, and it's really just not feasible for many women to
    drive hours and hours on end for all of the frequent yet
    critical prenatal visits they really need. We all know how
    important that is, but if you have to drive hours and hours
    once a week and you're trying to work and raise a family, you
    just can't do that. And then you also have to think about how
    to access this care when it's actually time to give birth.
        I'm interested to hear from each one of you how we can help
    address this issue to ensure that pregnant women can access the
    care they need. And I'll start with you, Dr. Richter.
        Dr. Richter. Well, first of all, we should provide
    transportation. That is key. What I find is a challenge is I
    have a large population, I take care of people with addiction,
    particularly opioid addiction.
        Senator Hassan. I wanted to follow-up with you on that,
    too.
        Dr. Richter. Right, very dysfunctional lives. We also have
    a program called Blueprint for Health where we actually have
    people that help manage in terms of getting people to
    appointments and those sorts of things. But they also need the
    transportation. Now, many of them, especially in rural areas,
    can't afford cars. If they do, they can't afford the gas and
    the insurance. So I would say providing transportation, and
    also some advocacy so that it makes it easier for them.
        Senator Hassan. Okay, that's great.
        Anybody else? Mr. Levine.
        Mr. Levine. Yes, absolutely. This is a problem we struggle
    with throughout our whole region, and there are two issues in
    particular. One, I think the idea of repurposing rural
    hospitals and providing them the resources to invest in
    recruiting and retaining physicians and mid-level providers is
    helpful. We suffer from a unique problem where we have a lot of
    drug-addicted women who are pregnant, and all the different
    flows of money that come from Washington and the states are all
    fragmented. So as a health system with 21 hospitals serving a
    geographic region, we'd like a situation where we can provide
    prenatal housing, prenatal treatment, food, prenatal care
    delivery through Medicaid, post-acute housing, post-acute food,
    and post-acute transition back into society. But those funding
    streams are all fragmented.
        We can solve this problem, or at least provide an effort to
    mitigate it, if you can figure out how to braid all these
    different flows of dollars from all these different Federal
    agencies.
        Senator Hassan. Okay. Mr. Reed.
        Mr. Reed. Senator Hassan, I remember sitting in your office
    and getting a lesson on the three, possibly four different
    regions in New Hampshire, and I remember realizing that I
    didn't really understand your state quite as well when it comes
    to those differing areas and how complex New Hampshire ends up
    being.
        But here's the interesting thing. Many of the women you're
    talking about, in fact nearly the majority of those women have
    a smart phone. They have a super-computer in their pocket that
    allows them to reach their doctor. It allows them to, if they
    have a wearable band----
        Senator Hassan. Except in our rural areas, the connectivity
    is terrible for broadband.
        Mr. Reed. That's correct, so you're going to hear me pitch
    a little bit about TV white spaces there as a possibility to
    expand beyond that. But here's the specific. When you are
    looking at reaching out to prenatal care, a lot of it is
    physicians answering questions. How do we make it possible for
    the physician to get appropriately reimbursed for their
    connection with a patient? How do you do population health? How
    do you do that engagement?
        On the other side, don't forget that once that birth
    happens, there's another huge cost. So Mississippi now uses a
    NICU sock that's connected to a smart phone, because it costs
    them $40,000 a day, in some cases, for NICU treatment. How do
    we actually allow this baby to go home with their mom healthy
    in a way that actually gets connected care?
        I like what you're talking about. How do we get it on the
    front end? Let's figure out how we use the technology that
    already exists to make this possible and get physicians
    appropriately reimbursed for using it so those questions get
    answered, people stay healthier longer throughout their
    prenatal care.
        When it comes to opioid addiction and the issues around
    that, again, the number-one issue around that often is societal
    and mental health. So let's figure out how we can use what
    they're doing today to better engage with them for their
    prenatal health.
        Senator Hassan. Mr. Glause.
        Mr. Glause. Thank you, Senator. I agree with the good
    doctor, the transportation is an issue, but Wyoming is unique
    in that we have very small communities that are 40 or 50 miles
    from a small town of 2,000, 2,500 people. And to try to solve
    that issue with public transportation just is not going to work
    if we send public transportation into a remote mountainous area
    to bring somebody to a hospital or a doctor appointment.
        I think one of the keys I keep coming back to is
    incentivize providers to come into small communities, the use
    of digital medicine through telemedicine. But even if one
    doctor is servicing several smaller communities on a weekly
    basis, it still gets the women and children the care they need.
    We have a low birth rate in Wyoming, which is the first sign
    that women are not getting the maternal care that they need.
        Senator Hassan. I appreciate that. I am almost out of time.
    I'm going to have to go to another meeting, but I will follow-
    up with all of you on the issue of medication-assisted
    treatment as we combat this opioid epidemic. I know all of our
    states are dealing with this, and I would ask my colleagues
    also to consider that Senator Gardner and I have the airwaves
    full just really trying to get at this connectivity issue in
    rural America, and one of the issues we're trying to crack here
    is using telemedicine and the devices we need in rural America
    so much. So I'd ask folks to look at that bill. We'd love to
    move it forward, and I'll follow-up with all of you on your
    ideas about medication-assisted treatment and the opioid
    epidemic as well. Thank you.
        Senator Enzi. Senator Kaine.
        Senator Kaine. Thank you, Mr. Chairman.
        To the witnesses, excellent testimony.
        Just really three observations, and I think there's some
    really good follow-up from your testimony and the dialog.
        First, a question that Senator Sanders was asking about
    what Medicaid cuts would mean. It's not a hard answer, and I
    get that some of you, that's not your particular focus. But
    just to give you an example, Medicaid and children, much less
    adults, in Virginia, more than 50 percent of the births of
    children in Virginia are paid for by Medicaid, and that was
    before we just did Medicaid expansion. So now it's going to be
    more. If your child gets a wheelchair in Virginia, it is likely
    that Medicaid is paying for that wheelchair. If your child is
    in elementary school or secondary school and is on an IEP, it's
    pretty likely that Medicaid is reimbursing your school district
    for some component of that IEP.
        I'm not talking about adults, those with disabilities. Just
    with kids, Medicaid cut effects are dramatic.
        I hope to bring you back an example early next year. The
    statistics that Mr. Levine laid out--and we're so glad to have
    him in Virginia--hospitals, 90 rural hospital closures in just
    the last 8 years, another 670 hospitals at risk. We are within
    a few months, I believe, of being the first example of
    reopening a hospital that has been closed for a long time in
    rural America that I'm aware of. A hospital in Lee County,
    Virginia, in the coal fields of Appalachia that was closed a
    number of years back is opening by year end. AmeriCorps is
    reopening the hospital.
        Mr. Levine talks about repurposing hospitals. It won't open
    exactly the way it was configured when it was closed, but we've
    been working with these folks in Lee County for a long time,
    and they've had to go through a million hoops and hurdles and
    figure out how to get it done, and it might be--if there are
    670 that are in jeopardy of closing, it might be interesting to
    bring one back after they're up and running so they can offer
    their ideas about here's how we did it and, boy, we wish we had
    done these other things. I hope we might do that. The reopening
    is scheduled in December.
        I just want to comment, Mr. Reed, you used UVA as an
    example on the telemedicine side. The opioid bill that we just
    passed and sent to the--I guess it's in conference, and
    hopefully the President will sign it soon--included a directive
    I guess that came out of the Finance Committee to clarify--for
    CMS to clarify that Medicaid reimbursement could be received
    for telemedicine provision of addiction recovery services.
    There is a bill pending now in the Senate called the Connect
    Act which would do the same thing with respect to Medicare
    reimbursements. I think, as we're talking about rural
    communities or underserved communities generally, the idea of
    telemedicine as the solution--there's no one solution, but as a
    solution to some people's challenges, it's really going to be a
    good solution.
        But if we don't have a reimbursement model that
    accommodates it, then we're going to grapple with the public
    transportation issue, or the challenges of folks' work
    schedules and things like that. Telemedicine isn't the answer
    for everybody, but when there are telemedicine applications, we
    shouldn't be standing in the way because we have outdated
    reimbursement models for the way health care providers provide
    services, and I think that offers some promise to rural
    America.
        I appreciate all of you for coming, and we'll look forward
    to taking these ideas as part of it. We've had a lot of
    hearings about diagnoses, and I'm really interested in getting
    to some prescriptions here soon.
        But thank you, Mr. Chairman, for doing this, and thank all
    of you.
        Mr. Reed. I would be remiss if I didn't mention the fact,
    with Senator Hassan asking about prenatal care, UVA has a fetal
    heart rate monitor system through Locus Health called Imprint,
    and I know, Senator Kaine, you've worked with Dr. Karen Revan
    on some of these exact issues. So earlier we talked about the
    importance of the Connect for Health Act as something that my
    organization and over 190 organizations, companies, patient
    groups and others support. So, thank you, and we'd like all the
    Senators to join together to get that bill passed.
        Senator Enzi. Thank you.
        Dr. Richter.
        Dr. Richter. Yes, I just want to respond to the couple of
    comments that were made about the fragmented financing. I was
    actually happy to hear that Mr. Levine actually sounds like
    he's endorsing a single payer. Is that true, Mr. Levine?
        Mr. Levine. No.
        [Laughter.]
        Dr. Richter. Because he's talking about the fact that when
    you have all these different payments, there's also an
    administrative cost at the provider end. The hospitals, they
    have to erect these bureaucracies to collect the money to keep
    their doors open. The same thing in the doctor's office. And
    again, that's another advantage to having a one-payer system,
    that at least it's one set of rules, regulations, and
    reimbursements that you have to deal with. You definitely still
    have to have administration, but not this amount. And for all
    that money that we're spending on administration and creating
    at the provider and payer end, we could be spending on these
    great ideas that we have. But I think we first have to figure
    out how to streamline that administration. And again, this is a
    plug for single payer, and I thank Mr. Levine for advocating
    for it.
        [Laughter.]
        Senator Enzi. I didn't hear that the same way, either. But
    one of the things that's hindering any kind of single payer is
    the difficulties with the VA. That's a government-run program
    that we thought was operating perfectly, and most of the people
    who were in it thought it was running perfectly, and then a
    bunch of people died in Arizona. And then we found out that the
    workers were fiddling with the figures and postponing
    appointments, and we found that was pretty extensive. I even
    did some checking on our two hospitals in Wyoming and found out
    there was a problem with that, and we've had a bunch of changes
    since then.
        Dr. Richter. Could I respond to that?
        Senator Sanders. No, let me respond to that, as somebody
    who is a member of the Committee, the Veterans Committee. The
    VA is the largest integrated health care system in the country.
    It has problems. The last that I heard, so does the private
    health care system. We have a system in which, as Dr. Richter
    was talking about, tens of thousands of people die each year
    because they either don't have any health insurance or they
    have high deductibles and co-payments, or they can't afford
    their prescription drugs.
        Nobody denies that a system with 137 medical centers, which
    is what the VA has, has its problems. But on the other hand,
    Mr. Chairman, I would suggest you speak to the American Legion
    and the DAV and the VFW and you ask them whether they want to
    privatize the VA, and unanimously they will tell you no, they
    want to strengthen the VA.
        Second of all, in terms of how the American people feel
    about government health insurance, the most popular health
    program in America is Medicare. The second most popular program
    is the VA. So in all instances, we need to improve those
    programs. But veterans feel pretty good about the VA, elderly
    people feel very good about Medicare, and the American people
    in poll after poll want us to move to a Medicare-for-all,
    single-payer program.
        Senator Enzi. I didn't intend to turn my part of the
    questions over to----
        Senator Sanders. Okay. I just wanted to comment.
        Senator Enzi. I appreciate your comments, and all of that
    is helpful.
        I want to go back to Mr. Levine because I know that you had
    21 hospitals, and more than half of them are rural, and I want
    to know how you recruit physicians for that. How do you get
    providers for these rural hospitals? How do you do searches?
    How do you compensate them? Is there this incentivizing that
    we're talking about in Wyoming?
        Mr. Levine. Well, good question, Mr. Chairman, and I would
    say two things. First, somebody earlier mentioned looking at
    Stark and the anti-kickback statutes. That's a big problem. In
    the fee-for-service system, the Stark and anti-kickback statute
    served an important role in preventing fraud. In a system where
    we're going toward value-based purchasing, they have actually
    become an impediment to integration with physicians.
        The reality is in rural communities we have to pay a lot
    more, and we always bump up against these issues of fair market
    value, and my biggest fights are sometimes with my legal
    department where we want to recruit and employ a doctor and we
    find that we have to pay them in excess of what the 90th
    percentile of some XYZ company says we're allowed to pay him.
    So I think the anti-kickback and Stark laws need to be looked
    at, particularly as it relates to non-urban and rural
    communities.
        But the bottom line is cost-based reimbursement helps us
    where we have hospitals that are critical access, where we have
    rural health clinics, being able to compensate them more, and
    getting the cost reimbursement through Medicare and Medicaid is
    very helpful. I think more of that would be helpful. I know
    there's a movement to actually go in the other direction and
    get rid of the provider-based, the hospital-based clinics, but
    they serve a valuable purpose.
        In each of our practices, we lose--for a specialist, we
    lose anywhere from $150,000 to $200,000 a year for a doctor
    that we employ. So it's a huge burden. Our system generally has
    negative operating margins of more than $100 million a year
    sustaining physicians in our rural communities that we
    shoulder, that we don't get paid for.
        Senator Enzi. Thank you.
        I need to shift direction a little bit here again. I need
    to go back to Mr. Reed because you were talking about not being
    able to be billed on digital health. Can you give a little more
    detail on that?
        Mr. Reed. Two basic problems exist in the digital health
    space. One is reimbursement that's appropriate for the care
    that's provided. Let's look at something like population
    health. You're a physician in care, and you have 25 patients
    that are in various conditions. Let's use the obvious example,
    because men are bad about taking their medicine and women are
    good at taking their medicine.
        If you're monitoring those patients through a remote
    patient monitoring tool, right now if Mr. Jones doesn't take
    his medicine and you call him in for an appointment, you get
    reimbursed for that appointment to see Mr. Jones because he
    didn't take his medicine. But Mrs. Jones, who is doing her
    time, she's undergoing her PT, she's taking her medicine on
    time, even though the physician is spending the same amount of
    time to monitor and set that up, the physician doesn't get
    reimbursed for it.
        The incentives are only aligned for you to wait until Mr.
    Jones gets sick and then you bring him in, and that's not what
    the doctor wants to do. The doctor wants healthy people that
    stay healthy.
        Part of it comes from the fact that the codes--I'm going to
    do something unusual. I'm going to say good things about a
    government agency. CMS this year unbundled Code 90991. That was
    a really important first step that allowed for the
    reimbursement of remote patient monitoring in a way that has
    never been allowed before, and we're hopeful. They predict
    about 250,000 uses of that code. We're hopeful that will
    actually unlock some of this digital medicine.
        The second aspect that we get into on some of these coding
    questions is if the code only reimburses at a level that
    doesn't match what the physician actually has to spend because
    they say, well, it's remote, but that physician still has to
    have the bricks and mortar, he still has to have the assistant,
    he still has to have the same facility with the lights on even
    though he's providing that care remotely. So the reimbursement
    for telemedicine and remote patient monitoring needs to be
    appropriate to the fact that what you're getting is a highly
    qualified doctor to answer your questions when you need it.
        Some things have gone well with CMS, some things not so
    good.
        Then finally, I would be remiss if I didn't hit on the
    other aspect, which is we are hopeful that ONC will get their
    anti-blocking report out. My understanding is it's moved over
    to OMB, but we need to see what the numbers look like. We need
    to see the data of what's working and what's not. Right now,
    physicians, organizations like Mr. Levine's, don't have access
    to the data that they need to make the good decisions that they
    want.
        If you're looking at how do we get reimbursed for this,
    first give us the codes; second, make sure that it's
    appropriate to the use; and third, give us the data to know
    what works.
        Senator Enzi. Anybody have any other comments on problems
    with going to telemedicine in rural areas?
        [No response.]
        Senator Enzi. Okay.
        Mr. Glause, you mentioned that 70 percent of the people in
    Wyoming live within 70 miles of the border, and so they're
    taking a lot of their health care to other places like Salt
    Lake City or Billings or Rapid City or Fort Collins. Can you
    talk about how that type of pattern affects the cost of health
    care and the ability to recruit physicians, and any solutions
    you might have?
        Mr. Glause. Thank you, Senator. You are correct with that
    statistic that 70 percent of our population lives within 70
    miles of a border. In Southwest Wyoming we have out-migration
    to Salt Lake City. In Northwest Wyoming we have out-migration
    to the Billings area. In Northeast Wyoming the migration is to
    Rapid City, South Dakota. And in Southeast Wyoming, in the
    Cheyenne and Laramie areas, the migration is to Fort Collins
    and Denver.
        We're already a small population, and when you look at over
    70 percent of the people are seeking their health care out of
    the state, it only reduces that population that the doctors are
    able to draw from. There are no economies of scale left. The
    ability to amortize the cost of equipment over a larger
    population dissipates. The ability to attract doctors to areas
    is further strained because the limited population we have to
    start with is going out of state. So that migration out of
    state really drives the cost up within the state to deliver
    those services.
        Senator Enzi. Thank you. And do you know of any ways to get
    more competition in that individual market?
        Mr. Glause. I wish I had a good answer for you. It gets
    very complicated. To get competition both at the provider level
    and at the insurer level has been one of my main focuses for
    the insurance department. Insurance companies are not
    interested in coming into the small markets. They have to build
    a market share. They have to come in and try to create a
    provider network where there are limited providers. And to
    compete with the carrier that is there, they have to do this on
    a price point. And with the lack of population, it is very,
    very hard to make this sound like a very attractive business
    opportunity.
        Senator Enzi. Anybody else want to comment?
        Dr. Richter. Well, I would say that competition, it depends
    on what you mean by competition. Competition amongst insurance
    companies really means marketing to the healthier population,
    which is about 80 percent of the population that's relatively
    healthy. Twenty percent are sick and use 80 percent of the
    care. So that's not going to reduce costs by increasing that
    sort of risk selection.
        I would say in terms of the provider end, it's really that
    you can't have two rural hospitals competing against each other
    because of what Mr. Levine said, most of the costs are fixed. A
    majority of hospital costs, at least 75 percent, are fixed. So
    the idea that you would have to have all the bells and whistles
    in those competing hospitals, it's not feasible.
        Senator Enzi. Right.
        Mr. Levine. Thank you. Dr. Richter, you just made the case
    for the reason our health system exists. Ballad Health was
    formed through the merger of two health systems that were
    competitors. What was going on in our market, we were spending
    tens of millions of dollars creating redundant, duplicative
    services, and the problem is that we had a declining
    population, and this race of spending capital, we couldn't
    afford it anymore.
        The markets where we had the highest costs, the markets
    where our hospitals are actually losing the most money were the
    ones that were actually the most competitive because there was
    so much duplication of effort and duplication of cost, but
    you'd have two hospitals using only 20 percent of their
    capacity each. So the fixed costs were just unsustainable.
        That's why we ended up merging under what's called the
    State Action Immunity Doctrine of anti-trust law. The FTC staff
    were not happy with our merger and did not like it, but both a
    Republican Governor of Tennessee and a Democratic Governor of
    Virginia signed laws that were passed unanimously by both
    legislatures to permit our merger to occur for the purpose of
    reducing about $300 million in cost, and then reinvesting those
    dollars in repurposing these rural hospitals. That's why we're
    going to have things like maternal care, emergency care, mental
    health and addiction services that were not previously able to
    be provided. We're actually going to fund those.
        As to insurance, I'm not an expert on insurance, but I
    think the bottom line is--I've always been struck, Mr.
    Chairman, by the fact that we've taken, for instance, children,
    we created the SCHIP program. Children are by far the
    healthiest risk. We've carved the healthiest risk out of the
    insurance market and put them in a government program where
    those healthy lives can no longer be part of the risk pool. So
    when you pull healthy lives out of a risk pool, all you're left
    with are older people who are unhealthier, and then the cost of
    insurance goes up.
        The idea fundamentally needs to be to create healthier risk
    pools. The more we carve up healthy populations and put them
    into various government programs, the more we pull them out of
    the risk pools. And I'm not suggesting that--like I said, I'm
    not an expert on this, but I do think that's part of what has
    led to higher spikes in cost of coverage prior to the
    Affordable Care Act. I think there are other factors that led
    to cost increases once the Affordable Care Act went into place.
        Senator Enzi. Rather than get into a debate on that, I need
    to change topics slightly here. Part of this is going back to
    telemedicine, which is something we have to have in Wyoming in
    order to reach the rural population. One of the problems that
    we're having is that some of the providers could be across
    state lines, on a telephone, to serve our people, but the
    licensing for doctors is state by state. So before they can
    call a guy on the telephone, he has to become researched and
    licensed in our state. I think that's one impediment we have,
    even for visiting doctors to come. Is that a problem anywhere
    else?
        Mr. Levine. Yes. Yes, sir.
        Senator Enzi. Okay.
        Dr. Richter. Yes.
        Senator Enzi. Okay. I want to go back to--since Senator
    Bennet mentioned Medicare Part D and the fact that we haven't
    pulled the trigger yet on part of that, I put that trigger in
    there. I was really worried. Wyoming only had two people that
    were providing any medical, any prescription insurance, and I
    was afraid that when we went to this Part D, that we might lose
    both of those. So I thought there ought to be some alternative
    to go in there.
        Now, my mom was one of the people that was eligible for it,
    so I asked her if she was going to need any help on figuring
    out her prescription D or not, and she said that she could use
    a little bit of help. I don't know if you remember the books
    that came out that were about that thick, with really thin
    pages, for these seniors to look through to see if they could
    qualify. So I tried out every mechanism that there was for
    making the selection so that maybe I could also try these
    systems to find out how they work. The reason that book is so
    thick is because we've got competition. It was kind of virtual
    pricing that was done on that. Anyone who put their
    prescriptions in could see what each of the different companies
    would provide on that.
        My question is, are there some other things that
    transparency could help solve some of the rural problems?
        Mr. Glause. One of the issues that I think has been
    successfully addressed is the SHIP program, the Senior Health
    Initiative Plan. Sometimes we're charged with doing the
    Medicare supplement guide that is also part of that Federal
    grant, but the navigators that we have in Wyoming, many of them
    are volunteers, and the money that we get from that grant is
    used to train those people to help seniors navigate those
    waters.
        I often refer people to those navigators to help them, and
    they report back to me that they are very, very informative and
    educational and helpful to them. So the SHIP money I think is
    well spent.
        Mr. Reed. I want to be specific. Cost transparency is
    always a really interesting issue. Mostly, my members tend to
    look at it from an access to data standpoint. They want to see
    the data so that they can help build tools and others that give
    insights into what things actually cost. The difficulty that we
    face on it is, and having met with health systems, sometimes
    health transparency is something that begins on day one that
    you think you'll solve in a 5-minute meeting, and it ends up
    being a 5-month seminar in exactly where that cost is that you
    thought was in the emergency room but ends up over there.
        I want to be respectful of the people who work in hospital
    systems and health systems who understand that cost
    transparency is difficult. But I will say that with effective
    cost transparency, it gives us the ability to give people more
    insight into where their money is going, and hopefully, back to
    your point about competition, provide some competition that
    comes from the digital space.
        We have several members who already build products that
    allow you to choose your doctor, look at what services they
    provide, look at their average cost, make a decision. This is
    terrible if you're in an emergency room, but if you've got a
    plethora of doctors, not in Wyoming, that kind of transparency
    can actually lead you to the ability to say I want to see Dr.
    Bob. He fits my cost structure, I like the things that he's
    done, let's give him a call.
        More transparency can lead to good use of data and more
    competition, but I want to be respectful of the people who run
    health systems that understand that it's not that easy.
        Mr. Levine. Senator, I was proud that I was Secretary of
    Health in Florida when we were the first state in the country
    to publish hospital pricing and prescription drug pricing on
    the Internet. This was back in 2005. And it was interesting to
    see how quickly prices, particularly for prescription drugs,
    got affected by that. When pharmacies right across the street
    from each other found out what the other was charging, the
    pricing came down pretty quick. That was the easy stuff.
        The hard thing, we actually tried to give patients an
    estimate of what it's going to cost. The problem is that
    oftentimes you don't know all the different comorbidities that
    a patient has when they go into the hospital. I hate to sit
    here and say, gee, it's really hard. It is really hard. It's
    something we have to continue to work toward.
        I think as more and more health systems modernize their
    data systems--and I know we may have a disagreement on some of
    that, but the good news about all these data systems that are
    now being deployed is now the data is becoming more unified,
    and I think with that data we can use predictive modeling and
    predictive analytics to determine with more precision what
    those costs are going to be. And let me just tell you, there's
    nothing more frustrating to a CEO of a health system than to
    not be able to tell somebody this is what it's going to cost
    you.
        Now, the problem we have, as I mentioned, even with the
    insured population, the biggest part of their cost they can't
    even pay for anyway, whether it was $100 or $10,000. They just
    can't come up with the money, and unfortunately we're having to
    eat that.
        Senator Enzi. Did you want to make a closing comment?
        Dr. Richter. Well, I guess what I would say too, though, is
    you had asked about the drug costs, and the real problem I have
    as a clinician is not knowing what the drugs cost because they
    change. I prescribed mebendazole, which is a drug for
    intestinal parasites, to a patient thinking, Okay, no big deal,
    ten bucks, and it turns out Medicaid refused to pay it, and I
    couldn't figure out why. So I sent in a prior authorization and
    then looked it up. It's because it went to $455 per pill from
    $7.
        That's part of our problem too, that these drug costs are
    inflating just ridiculous amounts, and we don't really always
    know what they are. So I think the transparency is not so easy
    for those reasons.
        Senator Enzi. That's an area in the whole Committee that
    we've had some hearings on too, on how we get some drug
    transparency pricing, pricing transparency, and finding out
    some of the complexities of that. There isn't anything in the
    health care field that's easy, I don't think.
        Dr. Richter. Who knew?
        [Laughter.]
        Senator Enzi. I want to thank all of you for participating.
        The hearing record will remain open for 10 days so you can
    submit additional information if you want to. I also allow
    Members to submit questions. You need to turn those in by
    tomorrow night, I guess. It's a little too late for tonight by
    5 o'clock. And if you would provide answers to those, we'd
    really appreciate it. Your testimony and your answers will be a
    part of the record.
        Thank you for being here today.
        The Committee stands adjourned.
        Dr. Richter. Thank you, Chairman Enzi.
        [Whereupon, at 5:11 p.m., the hearing was adjourned.]

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