[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]



                                 
                     REDUCING HEALTH CARE COSTS FOR
                  WORKING AMERICANS AND THEIR FAMILIES

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


                                HEARING

                               Before The

                         SUBCOMMITTEE ON HEALTH,  
                     EMPLOYMENT, LABOR, AND PENSIONS 

                                 of the

                      COMMITTEE ON EDUCATION AND THE  
                               WORKFORCE 
                      U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED EIGHTEENTH CONGRESS

                              FIRST SESSION 
                               __________



             HEARING HELD IN WASHINGTON, DC, APRIL 26, 2023

                               __________

                            Serial No. 118-7
                               __________

  Printed for the use of the Committee on Education and the Workforce 
  
  
  
  
  
 
               [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
 
 
  
  
  


        Available via: edworkforce.house.gov or www.govinfo.gov 
        
                                ______
	
                  U.S. GOVERNMENT PUBLISHING OFFICE 

51-857 PDF               WASHINGTON : 2024 
















        
                COMMITTEE ON EDUCATION AND THE WORKFORCE

               VIRGINIA FOXX, North Carolina, Chairwoman

JOE WILSON, South Carolina           ROBERT C. ``BOBBY'' SCOTT, Virginia, 
GLENN THOMPSON, Pennsylvania           Ranking Member  
TIM WALBERG, Michigan                RAUL M. GRIJALVA, Arizona 
GLENN GROTHMAN, Wisconsin            JOE COURTNEY, Connecticut
ELISE M. STEFANIK, New York          GREGORIO KILILI CAMACHO SABLAN,
RICK W. ALLEN, Georgia                 Northern Mariana Islands
JIM BANKS, Indiana                   FREDERICA S. WILSON, Florida 
JAMES COMER, Kentucky                SUZANNE BONAMICI, Oregon
LLOYD SMUCKER, Pennsylvania          MARK TAKANO, California
BURGESS OWENS, Utah                  ALMA S. ADAMS, North Carolina
BOB GOOD, Virginia                   MARK DeSAULNIER, California
LISA McCLAIN, Michigan               DONALD NORCROSS, New Jersey
MARY MILLER, Illinois                PRAMILA JAYAPAL, Washington
MICHELLE STEEL, California           SUSAN WILD, Pennsylvania
RON ESTES, Kansas                    LUCY McBATH, Georgia
JULIA LETLOW, Louisiana              JAHANA HAYES, Connecticut
KEVIN KILEY, California              ILHAN OMAR, Minnesota
AARON BEAN, Florida                  HALEY M. STEVENS, Michigan
ERIC BURLISON, Missouri              TERESA LEGER FERNANDEZ, New Mexico
NATHANIEL MORAN, Texas               KATHY MANNING, North Carolina
JOHN JAMES, Michigan                 FRANK J. MRVAN, Indiana
LORI CHAVEZ-DeREMER, Oregon          JAMAAL BOWMAN, New York
BRANDON WILLIAMS, New York           
ERIN HOUCHIN, Indiana

                       Cyrus Artz, Staff Director
              Veronique Pluviose, Minority Staff Director 
              
                                 ------                                

        SUBCOMMITTEE ON HEALTH, EMPLOYMENT, LABOR, AND PENSIONS

                      BOB GOOD, Virginia, Chairman

JOE WILSON, South Carolina           MARK DeSAULNIER, California
TIM WALBERG, Michigan                  Ranking Member
RICK ALLEN, Georgia                  JOE COURTNEY, Connecticut
JIM BANKS, Indiana                   DONALD NORCROSS, New Jersey
JAMES COMER, Kentucky                SUSAN WILD, Pennsylvania
LLOYD SMUCKER, Pennsylvania          FRANK J. MRVAN, Indiana
MICHELLE STEEL, California           PRAMILA, JAYAPAL, Washington
AARON BEAN, Florida                  LUCY McBATH, Georgia
ERIC BURLISON, Missouri              JAHANA HAYES, Connecticut
LORI CHAVEZ-DeREMER, Oregon          ILHAN OMAR, Minnesota
ERIN HOUCHIN, Indiana                KATHY MANNING, North Carolina 
















                         C  O  N  T  E  N  T  S

                              ----------                              
                                                                   Page

Hearing held on April 26, 2023...................................     1

                           OPENING STATEMENTS

    Good, Hon. Bob, Chairman, Subcommittee on Health, Employment, 
      Labor, an Pensions.........................................     1
        Prepared statement of....................................     3
    DeSaulnier, Hon. Mark, Ranking Member, Subcommittee on 
      Health, Employment, Labor, an Pensions.....................     4
        Prepared statement of....................................     6

                               WITNESSES

    Watts, Tracy, Senior Partner, Mercer.........................     7
        Prepared statement of....................................    10
    Strouse, Marcie, Partner, Capitol Benefits Group.............    54
        Prepared statement of....................................    56
    Corlette, Sabrina, J.D., Senior Research Professor, Center on 
      Health Insurance Reforms, Georgetown University's Health 
      Policy Institute...........................................    60
        Prepared statement of....................................    62
    White, Joel, President, Council for Affordable Health 
      Coverage (CAHC)............................................    75
        Prepared statement of....................................    77

                         ADDITIONAL SUBMISSIONS

    Chairman Good:
        Letter dated April 25, 2023, Americans for Prosperity....   125
        Letter dated April 26, 2023, from American Hospital 
          Association............................................   127
        Letter dated April 25, 2023, from a non-partisan group of 
          organizations..........................................   134
        Letter dated April 26, 2023, from National Association of 
          Benefits and Insurance Professionals...................   136
        Letter from Better Solutions for Healthcare..............   143
        Statement dated April 26, 2023, from The Coalition To 
          Protect and Promote Association Health Plans...........   144
        Letter dated April 26, 2023, from The Alliance To Fight 
          for Health Care........................................   154
        Statement from Partnership for Employer-Sponsored 
          Coverage...............................................   163
        Letter dated April 26, 2023, from Careviso...............   169
        Letter dated April 26, 2023, from Blue Cross Blue Shield 
          Association............................................   171
        Policy Brief dated April 26, 2023, from Paragon Health 
          Institute..............................................   173
    Ranking Member Scott:
        Letter dated April 26, 2023, signed by 25 patient and 
          consumer organizations.................................   113
        Letter dated April 26, 2023, from Families USA...........   117

                        QUESTIONS FOR THE RECORD

    Response to question submitted for the record by:
        Sabrina Corlette.........................................   184
        Marcie Strouse...........................................   192
        Tracy Watts..............................................   196
        Joel White...............................................   204


 
                     REDUCING HEALTH CARE COSTS FOR 
                  WORKING AMERICANS AND THEIR FAMILIES

                              ----------                              

                       Wednesday, April 26, 2023

                                House of Representatives,
              Subcommittee on Health, Employment, Labor, and 
                                                   Pensions,
                      Committee on Education and the Workforce,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:15 a.m., 
Room 2175, Rayburn House Office Building, Hon. Bob Good 
[chairman of the subcommittee] presiding.
    Present: Representatives Good, Walberg, Allen, Banks, 
Smucker, Bean, Burlison, DeSaulnier, Courtney, Norcross, Wild, 
Jayapal, McBath, Hayes, Omar, Manning, Scott.
    Staff present: Cyrus Artz, Staff Director; Mindy Barry, 
General Counsel; Michael Davis, Legislative Assistant; Cate 
Dillon, Director of Operations; Daniel Fuenzalida, Staff 
Assistant; Sheila Havenner, Director of Information Technology; 
Taylor Hittle, Professional Staff Member; Alex Knorr, 
Legislative Assistant; Andrew Kuzy, Press Assistant; John 
Martin, Deputy Director of Workforce Policy/Counsel; Hannah 
Matesic, Director of Member Services and Coalitions; Audra 
McGeorge, Communications Director; Rebecca Powell, Staff 
Assistant; Seth Waugh, Brittany Alston, Minority Operations 
Assistant; Ilana Brunner, Minority General Counsel; Daniel 
Foster, Minority Health and Labor Counsel; Carrie Hughes, 
Minority Director of Health and Human Services Policy; 
Stephanie Lalle, Minority Communications Director; Kota 
Mizutani, Minority Deputy Communications Director; Veronique 
Pluviose, Minority Staff Director; Dhrtvan Sherman, Minority 
Staff Assistant; Banyon Vassar, Minority IT Administrator.
    Chairman Good. The Subcommittee on Health Employment Labor 
and Pensions will come to order. I note that a quorum is 
present. Without objection, the Chair is authorized to call a 
recess at any time. The subcommittee is meeting today on 
solutions to address healthcare challenges facing working 
families and small businesses.
    Good morning, everyone, and welcome to today's hearing. I 
can remember President Obama's promises regarding Obamacare. If 
you like your plan, you can keep your plan. If you like your 
doctor, you can keep your doctor. Premiums will go down with 
the Affordable Care Act. Sadly, but not surprising, these were 
all misleading, empty, broken promises.
    In reality, Obamacare's regulations mandate inflationary 
subsidies and misguided economic incentives have made 
healthcare even more unaffordable for Americans in the 
commercial market. It is no surprise that for 13 years of 
Obamacare, three in four Americans grade the healthcare system 
as a D or an F.
    Working Americans and their families are being crushed, and 
the American people are tired of their premiums going up. They 
are tired of their deductibles going up. They are tired of 
their copay going up. Today, in this first Health Employment 
Labor and Pension Subcommittee hearing of the 118th Congress, 
House Republicans will put forth a vision for free market 
healthcare reform that offers Americans much needed relief.
    As a nation, we cannot settle for less than American 
exceptionalism. We cannot turn to socialist countries for our 
healthcare advice. We need to listen to the American people. A 
vast majority of Americans are actually satisfied with their 
employer sponsored insurance.
    78 percent of employees choose to enroll in employer 
sponsored insurance when given the option. It is still too 
expensive. That is because Democrats have created an unlevel 
playing field for employers. Democrats are not interested in 
addressing affordability issues for employers because the truth 
is they are scheming with the Biden administration to force 
every American into a government funded one size fits all plan, 
such as the Obamacare Marketplace Plan.
    By increasing Obamacare subsidies and overregulating the 
market, employer-based healthcare is becoming unaffordable, 
especially for small business owners. This is an intentional 
attack by Democrats on private insurance is the proverbial 
trojan horse for Medicare for all. One size does not fit all.
    The correct path forward is to respect and protect a free 
market and individual choice. Republican solutions seek to 
decrease healthcare costs, while strengthening the public 
option that 159 million Americans who are covered enjoy today. 
Yesterday, I introduced the Self Insurance Protect Act. This 
bill allows small businesses to access stock loss insurance, a 
form of insurance that helps employers self-insure, and 
protects them from catastrophic health costs.
    Another reasonable solution is to increase association 
health plans. These plans allow Americans to save up to 50 
percent on healthcare costs by allowing small businesses to 
band together to offer lower cost healthcare insurance like 
large employers are able to do.
    The free market and increased competition will lower prices 
if we are bold enough to let them do that. A free market only 
works when there is competition, transparency, and 
accountability. Consolidation of marketplace has led to 
dishonest billing practices. Dishonest billing occurs when big 
hospitals buy up independent doctors' offices, and then charge 
higher prices for doctor services as if they were occurring in 
a hospital setting.
    Hospitals should bill the proper rate for their services 
and not use bogus facility fees as an excuse to tack on 
thousands of dollars in extra charges. Finally, we should 
ensure that workers retain access to the deregulated telehealth 
options they enjoyed during the COVID-19 health restrictions. 
With that, I look forward to the hearing today, and yield to 
our Ranking Member.
    [The Statement of Chairman Good follows:]

     Statement of Hon. Bob Good, Chairman, Subcommittee on Health, 
                    Employment, Labor, and Pensions

    I remember President Obama's promises regarding Obamacare:
    ``If you like your plan, you can keep your plan.''
    ``If you like your doctor, you can keep your doctor.''
    ``Premiums will go down with the Affordable Care Act.''
    Sadly, but not surprisingly, these were all misleading, empty, 
broken promises.
    In reality, Obamacare's regulations, mandates, inflationary 
subsidies, and misguided economic incentives have made health care even 
more unaffordable for Americans in the commercial market.
    After thirteen years of Obamacare, three in four Americans grade 
the health care system as a ``D'' or an ``F.''
    Working Americans and their families are being crushed. The 
American people are tired of their premiums going up. They are tired of 
their deductibles going up. They are tired of their co-pays going up.
    Today, in the first Health, Employment, Labor, and Pensions 
Subcommittee hearing of the 118th Congress, House Republicans will put 
forth a vision for free-market health care reform that offers Americans 
much-needed relief.
    As a nation, we cannot settle for less than American 
exceptionalism. We cannot turn to socialist countries for health care 
advice.
    We need to listen to the American people. A vast majority of 
Americans are actually satisfied with their employer-sponsored 
insurance. Seventy-eight percent of employees decide to enroll in 
employer-sponsored insurance when given the option. It is still too 
expensive.
    That is because Democrats have created an unlevel playing field for 
employers.
    Democrats are not interested in addressing affordability issues for 
employers, because the truth is, they are scheming with the Biden 
administration to force every American into a government-funded, one-
size-fits-all plan, such as the Obamacare marketplace plans.
    By increasing Obamacare subsidies and overregulating the market, 
employer-based health care is becoming unaffordable, especially for 
small business owners.
    This is an intentional attack by Democrats on private insurance. It 
is the proverbial ``trojan horse'' for Medicare-for-All.
    One size does not fit all. The correct path forward is to respect 
and protect the free market, and individual choice.
    Republican solutions seek to decrease health care costs while 
strengthening the private options that 159 million covered Americans 
enjoy.
    Yesterday, I introduced the Self-Insurance Protection Act. This 
bill allows small businesses to access stop-loss insurance, a form of 
insurance that helps employers self-insure and protects them from 
catastrophic health costs.
    Another reasonable solution is to increase Association Health 
Plans. These plans allow Americans to save up to 50 percent on health 
care costs by allowing small businesses to band together to offer 
lower-cost health insurance like larger employers are able to do. The 
free market and increased competition will lower prices if we are bold 
enough to let them.
    A free market only works when there is competition, transparency, 
and accountability. Consolidation in the marketplace has led to 
dishonest billing practices. Dishonest billing occurs when big 
hospitals buy up independent doctors' offices and then charge higher 
prices for doctor services as if they were occurring in a hospital 
setting.
    Hospitals should bill the proper rate for their services and not 
use bogus facility fees as an excuse to tack on thousands of extra 
dollars in charges.
    Finally, we should ensure that workers retain access to the 
expanded telehealth options they enjoyed during the COVID-19 waivers. 
On May 11, employees may lose access to telehealth coverage when the 
COVID-19 Public Health Emergency expires. The Telehealth Benefit 
Expansion for Workers Act will ensure that telehealth coverage is not 
terminated for these workers.
    Stop-loss insurance, Association Health Plans, honest billing, and 
increased access to telehealth will help increase affordability for 
American workers and their families.
    Employer-sponsored insurance is the greatest threat to, or defense 
against--depending on your perspective--Medicare-for-All.
    Letting Democrats continue to further diminish employer-sponsored 
insurance--to the detriment of American families--is a major step 
toward realizing their coveted cradle-to-grave nanny state.
    That is not America. We are the most free and prosperous nation in 
history. Small business owners and working families, through hard work, 
perseverance, and determination have made our nation great. Washington 
bureaucrats should stay out of the way.
    Let us empower Americans to have the health care they choose at an 
affordable cost.
                                 ______
                                 
    Mr. DeSaulnier. Thank you, Mr. Chairman. I want to thank 
the witnesses for being here. I appreciate the comments as a 
former small business owner or restaurant owner. 13 years ago, 
48 million Americans, more than 14 percent of the U.S. 
population, did not have health coverage at all.
    Insurers could deny people coverage because of pre-existing 
conditions. Insurers could charge women more than men for 
health insurance. Most individual market plans only covered a 
fraction of prescription drugs. Today, more Americans are 
covered and have better health care protections than ever 
before.
    This is a direct result of the key steps Democrats took to 
expand and protect access to affordable high-quality health 
care coverage. In 2010, President Barack Obama signed into law 
the Affordable Care Act, which provided millions of Americans 
with access to quality coverage and key consumer protections. 
Thanks to this milestone achievement, insurers could no longer 
deny people coverage for pre-existing conditions.
    Plans must cover preventative services, like cancer 
screenings and birth control at no cost. Mental health and 
substance use disorder treatment is considered an essential 
health benefit. During the last two Congresses we built on the 
progress of the ACA and took decisive steps to lower health 
care costs even further for Americans.
    We passed bipartisan legislation to protect Americans from 
surprise medical billing, and improved transparency and health 
care. Congressional Democrats passed the American Rescue Plan, 
which enhanced the ACA tax credits to lower monthly costs for 
low-income individuals, and eliminated the subsidy cliff, so 
that more low-and moderate-income individuals could get 
coverage.
    Last, Democrats passed the Inflation Reduction Act. This 
historic legislation extended the premium on tax credit 
enhancements, capped the cost of insulin. For people with 
Medicare, and for the first time, directed the Federal 
Government to negotiate lower prices for prescription drugs 
covered by Medicare.
    These victories have yielded real results, lowering costs, 
and making health care more affordable. Clearly, we have a 
difference of perspective. In August, we brought the number of 
Americans without health insurance down to the lowest level 
ever. In fact, during the most recent Open Enrollment Period, a 
record 16.3 million people signed up for coverage, and the 
average consumer has saved hundreds of dollars a year in 
premiums.
    Unfortunately, our progress under the ACA continues to be 
threatened. For more than a decade, our colleagues and 
conservative groups have worked relentlessly to erode or 
eliminate the ACA. Just last month, the conservative judge in 
Texas ruled to weaken the ACA's preventive services 
requirement.
    This has jeopardized access to preventative care ACA for 
millions who otherwise would not be able to afford it. For 
context, this is the same judge who attempted to eliminate the 
entire ACA, before it was upheld by the U.S. Supreme Court. I 
am concerned about the development since I know that many of us 
may not see eye to eye on many things, but the value and 
importance of preventative care is undeniable to ensuring the 
health and well-being of our country.
    Moreover, we know that preventative care can result in 
lower costs by managing chronic disease, supporting mental 
health costs, and more, and it helps employers and employer-
based health care. Unfortunately, many of our colleagues' 
proposals that we will hear today could undermine affordability 
and ultimately make it harder, not easier, to access quality 
coverage.
    However, we will keep an open mind and hope for progress in 
compromise with our colleagues. Expanding American health plans 
might provide low premiums for some enrollees, but it would 
increase costs for other consumers in the traditional insurance 
market, while adding nothing to address the underlying price of 
health care.
    This is a bad deal for American workers, and for small 
businesses. Similarly, exempting telehealth plans from key 
consumer protection, such as mental health parity on the ACA's 
preventive services requirement, could expose workers to 
deceptive marketing practices that we have seen emerge when 
employers offer similar unregulated arrangements.
    Done properly, I think that is something we could look at. 
Instead of going backward, we should be focusing on expanding 
quality health coverage for all Americans, workers and 
families, employers, and their employees.
    This Congress, we have several opportunities to make 
bipartisan progress, and I look forward to that engaged 
discussion, irrespective of where we may start on these issues. 
We can work together to strengthen the ACA, and close the 
Medicaid coverage gap, which would help millions of people 
access subsidized coverage.
    We can bolster enforcement of mental health parity and 
ensure that health plans follow the law. We can build on our 
progress to empower the Federal Government and all Americans to 
be able to negotiate and have the benefit of lower costs for 
even higher quality and more controls over prescription drugs, 
many of which have started their discovery process with 
taxpayer investments at the National Institutes of Health.
    We can increase transparency in our health care system and 
take a careful look at business practices that lead to higher 
prices and provider consolidation. Look, there are many 
different views on how to lower health care costs, and I think 
you have heard some different perspectives already from the 
Chairman and myself.
    I hope we can work together in good faith to deliver on our 
commitment, that we mutually agree that extraordinary health 
care, and the idea of American exceptionalism is something we 
should all expect for all Americans. I look forward to the 
discussion, and I yield back.
    [The Statement of Ranking Member DeSaulnier follows:]

  Statement of Hon. Mark DeSaulnier, Ranking Member, Subcommittee on 
                Health, Employment, Labor, and Pensions

    Thank you, Mr. Chairman. I want to thank the witnesses for being 
here. I appreciate the comments as a former small business owner-a 
restaurant owner.
    Thirteen years ago, 48 million Americans-more than 14 percent of 
the U.S. population-did not have health coverage at all.
    Insurers could deny people coverage because of pre-existing 
conditions. Insurers could charge women more than men for health 
insurance.
    Most individual market plans only covered a fraction of 
prescription drugs. Today, more Americans are covered, and have better 
health care protections, than ever before.
    This is the direct result of the key steps Democrats took to expand 
and protect access to affordable, high-quality health care coverage.
    In 2010, President Barack Obama signed into law the Affordable Care 
Act, which provided millions of Americans with access to quality 
coverage and key consumer protections. Thanks to this milestone 
achievement, insurers can no longer deny people coverage for pre-
existing conditions. Plans must cover preventive services--like cancer 
screenings and birth control--at no cost. Mental health and substance 
use disorder treatment is considered an essential health benefit.
    During the last two Congresses, we built on the progress of the ACA 
and took decisive steps to lower health care costs even further for 
Americans.
    We passed bipartisan legislation to protect Americans from surprise 
medical billing and improve transparency in health care.
    Congressional Democrats passed the American Rescue Plan, which 
enhanced the ACA tax credits to lower monthly costs for low-income 
individuals and eliminated the subsidy ``cliff'' so that more low- and 
moderate-income individuals could get coverage.
    Lastly, Democrats passed the Inflation Reduction Act. This historic 
legislation extended the premium tax credit enhancements, capped the 
cost of insulin for people with Medicare, and for the first time 
directed the federal government to negotiate lower prices for 
prescription drugs covered by Medicare.
    These victories have yielded real results--lowering costs and 
making health care more affordable. Clearly, we have a difference of 
perspective.
    In August, we brought the number of Americans without health 
insurance down to the lowest level ever. In fact, during the most 
recent Open Enrollment Period, a record 16.3 million people signed up 
for coverage. The average consumer has saved hundreds of dollars a year 
in premiums.
    Unfortunately, our progress under the ACA continues to be 
threatened. For more than a decade, our colleagues and conservative 
groups have worked relentlessly to erode or eliminate the ACA.
    Just last month, a conservative judge in Texas ruled to weaken the 
ACA's preventive services requirement. This has jeopardized access to 
preventive care for millions who otherwise may not be able to afford 
it. For context, this is the same judge who attempted to eliminate the 
entire ACA before it was upheld by the United States Supreme Court.
     I am concerned about the development, since I know that many of us 
may not see eye to eye on many things, but the value and importance of 
preventive care is undeniable to ensuring the health and wellbeing of 
our country. Moreover, we know that preventive care can result in lower 
costs by managing chronic disease, supporting mental health costs, and 
more. It helps employers with employer-based health care.
    Unfortunately, many of our colleagues' proposals that we will hear 
today could undermine affordability and ultimately make it harder--not 
easier--to access quality coverage. However, we will keep an open mind 
and hope for progress and compromise with our colleagues.
    Expanding Association Health Plans might provide lower premiums for 
some enrollees, but it would increase costs for other consumers in the 
traditional insurance market while adding nothing to address the 
underlying price of health care. This is a bad deal for American 
workers and for small businesses.
    Similarly, exempting telehealth plans from key consumer 
protections, such as mental health parity or the ACA's preventive 
services requirement, could expose workers to deceptive marketing 
practices that we have seen emerge when employers offer similar 
unregulated arrangements. Done properly, I think this is something we 
can look at.
    Instead of going backwards, we should be focusing on expanding 
quality health coverage for all Americans, workers, families, employers 
and their employees.
    This Congress, we have several opportunities to make bipartisan 
progress, and I look forward to that engaged discussion, irrespective 
of where we may start on those issues.
    We can work together to strengthen the ACA and close the Medicaid 
coverage gap, which would help millions of people access subsidized 
coverage. We can bolster enforcement of mental health parity and ensure 
that health plans follow the law.
    We can build on our progress to empower the federal government and 
all Americans to be able to negotiate, and have the benefit of, lower 
costs for even higher quality and more controls over prescription 
drugs--many of which have started their discovery process with taxpayer 
investments at the National Institutes of Health.
    We can increase transparency in our health care system and take a 
careful look at business practices that lead to higher prices and 
provider consolidation.
    Look, there are many different views on how to lower health care 
costs and I think you have heard some different perspectives already 
from the Chairman and myself. I hope we can work together in good faith 
to deliver on our commitment that we mutually agree that extraordinary 
health care, and the idea of American exceptionalism, is something we 
should all expect for all Americans.
    I look forward to the discussion, and I yield back.
                                 ______
                                 
    Chairman Good. Thank you, Ranking Member DeSaulnier. 
Pursuant to Committee Rule 8(c), all members who wish to insert 
written statements into the record may do so by submitting them 
to the committee clerk electronically, in Microsoft Word format 
by 5 p.m., 14 days after the date of this hearing, which is May 
10, 2023.
    Without objection, the hearing record will remain open for 
14 days to allow such statements and other extraneous materials 
referenced in the hearing to be submitted for the official 
hearing record.
    I now turn to the introduction of our distinguished 
witnesses. Our first witness is Ms. Tracy Watts, who is a 
Senior Partner with Mercer, and leads the company's healthcare 
policy and group benefits portfolio for regions of the United 
States. Thank you, Ms. Watts.
    Our second witness is Ms. Marcie Strouse, who is a small 
business owner, and founder of Capitol Benefits Group in Des 
Moines, Iowa. Thank you, Ms. Strouse.
    Our third witness is Ms. Sabrina Corlette, who is the 
Senior Research Professor at the Center on Health Insurance 
Reforms, Georgetown University's Health Policies Institute.
    Our final witness is Mr. Joel White, who is President, 
Council for Affordable Health Coverage. I thank all of our 
witnesses for being here today. We look forward to your 
testimony.
    Pursuant to committee rules, I would ask that each of you 
limit your oral presentation to a 5-minute summary of your 
written statement, and I would also like to remind the 
witnesses be aware of the responsibility to provide accurate 
information to this subcommittee. I will first recognize Mrs. 
Tracy Watts.

        STATEMENT OF MRS. TRACY WATTS, SENIOR PARTNER, 
                           MERCER 

    Mrs. Watts. My name is Tracy Watts, and I am the Senior 
Partner and U.S. Health Policy leader at Mercer. I am also the 
immediate past Board Chair of the American Benefits Council. I 
have more than 35 years of experience helping large companies 
design, finance and manage their health benefit programs to 
control costs, and to improve the health of the workforce.
    First of all, we applaud the committee's work and 
commitment to address healthcare affordability. We surveyed 
over 4,000 workers in late 2022, and 68 percent say they had 
challenges getting the healthcare that they need for themselves 
and for their family.
    Those most concerned with affordability are low-income 
workers, female workers, workers below the age of 25, and over 
the age of 44. Access to healthcare is also an issue, finding a 
doctor, getting into a specialist, and getting time off from 
work to go to the doctor.
    In our employer research two-thirds of large employers say 
that improving healthcare affordability for their employees is 
a very important, or important priority for the next few years. 
A couple of examples of how they are doing that from a plan 
design perspective, 39 percent are offering a copay medical 
plan with little or no deductible. From a contribution 
perspective, 15 percent are offering free employee only 
coverage in one medical plan.
    Given the outlook for faster healthcare cost growth, you 
might expect that employers would start to pull back on health 
benefits. From our February/March survey on benefit strategies 
for 2024, it does not look like it. Nearly two-thirds say that 
they are planning to make enhancements to their health benefits 
as a way to improve attraction and retention--two-thirds.
    I would like to quickly touch on three topics associated 
with new legislation being introduced. Telehealth, when offered 
as an accepted benefit, meets a very specific need for certain 
employers, with a large number of employees who are not 
benefits eligible. These are mostly part-time workers in 
retail, hospitality, and healthcare.
    Because of legislative uncertainty, we saw a decline in 
employers using this strategy. 7 percent use it in 2023, that 
is down from 17 percent in 2022. This is a benefit that is 
hugely valued by workers, but employers need permanent 
legislation for this coverage to be restored.
    As an example, we worked with a large restaurant chain that 
extended telehealth to its part-time population. They viewed 
this benefit as a critical way to provide access to behavioral 
health services and appropriate medication when the employee 
who was not enrolled in the health plan gets sick. Next, with 
regard to legislation to ban unfair hospital billing practices, 
market consolidation and cost pressures have driven 
opportunistic billing practices by obfuscating where service is 
provided.
    Non-hospital services are billed using a hospital address 
as the place of service to optimize reimbursement at the 
hospital reimbursement rate. This raises prices for patients, 
it raises prices for employer plan sponsors. It raises prices 
for the Federal Government, and it is unfair. The most common 
example is the addition of hospital facility charge on a bill 
for an office visit that takes place miles away from the 
hospital, or worse yet, for a virtual visit.
    Another example is an urgent care facility where care is 
billed as a hospital emergency department visit. As a country, 
we cannot fix this problem if we cannot see the problem. The 
practices are increasing the costs for everyone, and if we are 
serious about managing costs and making healthcare more 
affordable, we need to address the core issue.
    We need more transparency on this. With regard to 
regulation of stop loss for small businesses, in the small 50 
to 499 employee group size, 71 percent of those companies buy 
an insured plan. The 29 percent self-fund the stop loss. That 
number flips to 71 percent to self-fund the stop loss in the 
500 to 999 category.
    Self-funding with stop loss allows companies to balance 
their financial objectives with their ability to manage risk, 
and it allows for greater flexibility to design benefits to 
address affordability and employees' needs. In this competitive 
environment, even with healthcare inflation, employers are 
looking for ways to enhance benefits, and to address 
affordability, and that means workers win.
    Thank you for the opportunity to be here today.
    [The Statement of Tracy Watts follows:] 
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
    
            
    Chairman Good. Thank you, Ms. Watts, and we will now go to 
our second witness, Ms. Strouse.

       STATEMENT OF MS. MARCIE STROUSE, PARTNER, CAPITOL 
                        BENEFITS GROUP

    Ms. Strouse. Good morning, Chairman, Ranking member, and 
members of the subcommittee. My name is Marcie Strouse, I am a 
Partner and Benefits Consultant at Capitol Benefits Group in 
Des Moines, Iowa. I am grateful for the opportunity to testify 
today on behalf of small business owners nationwide who are 
struggling with increasing healthcare costs.
    For four decades, the cost of health insurance has remained 
the No. 1 problem for small businesses. The problem is now a 
crisis, with skyrocketing costs crippling Main Street. In fact, 
98 percent of small businesses report that healthcare costs 
will become unsustainable in the next 10 years, threatening 
their ability to survive and remain competitive.
    This is why it is important that lawmakers focus on 
policies that empower small business owners, and their 
employees, with more choice and control over their healthcare 
decisions. For 20 years as a benefits professional, I have had 
the privilege of directly helping small business owners 
throughout the State of Iowa. I am boots on the ground sitting 
across from business owners throughout the State.
    As employers look today, we are trying to find ways to help 
solve problems. Healthcare affordability is particularly 
important for my family as well as we have experienced first-
hand the importance of having access to quality care. We have 
three awesome children, Sid, Ella, and Libby. At just 7 years 
old, my twins were diagnosed with a neuromuscular disease, and 
this experience changed me forever.
    Since then, I have worked closely with the Muscular 
Dystrophy Association and was appointed by Governor Kim 
Reynolds to the Iowa Medical Assistance Advisory Council 
working with Medicaid and MCOs in the State. I interact with 
small business owners daily, and I am a small business owner 
myself.
    I can tell you myself the overwhelming stress and anxiety 
small business owners are feeling right now. Small business 
owners care deeply about their employees, customers, and 
communities. They are constantly worried about recruiting and 
retaining employees while keeping their businesses afloat, and 
this is particularly challenging in this environment, with 
sustained high inflation and acute workforce shortages.
    Employee benefits have always been important but are even 
more crucial now. Our clients are more eager than ever to offer 
great benefits, and to meet the needs of a diverse workforce 
while remaining competitive, but unfortunately many lack the 
options. Many of our clients are forced to make tough choices 
every day.
    Some go without pay to keep their employees working. Others 
are forced to raise their prices or take a profit loss to 
contend with rising healthcare costs. For instance, in Polk 
County, Iowa, average small business premiums for a family have 
increased 85 percent in the last 8 years.
    For context, my family is currently enrolled in an 
individual grandmother plan through Blue Cross and Blue Shield. 
We have a $2,500.00 deductible, and our monthly premium is 
$903.00 for our family of five. A similar Affordable Care Act 
group plan today would be $1,952.00 in monthly premiums.
    The status quo is unsustainable. I hope this committee will 
advance policies that promote affordability and increased 
choices for small businesses. The following reforms would be a 
great starting point in providing much needed relief for many 
of our clients.
    First, Congress should significantly expand coverage 
options allowing small business owners, regardless of industry, 
to band together to form association plans, and give them the 
same bargaining power big employers have. Congress can also 
expand protections for small business owners who choose to 
self-insure, expanding access to stop loss and reinsurance, for 
instance can reduce financial risk, enhance plan design, and 
increase the business's competitiveness.
    For example, a recent client with three members was able to 
save $5,000.00 annually through a level funded reinsurance 
plan. They were also able to lower the out-of-pocket maximum 
and copays for their employees. Employers can also benefit from 
greater transparency and competition in the industry. The 
system is too opaque to the detriment of employers.
    Increasing transparency in the pharmacy benefit manager 
markets and reigning in healthcare hospital monopolies that 
engage in anti-competitive practices is key to lowering the 
cost of care. Last, lawmakers should reduce burdens on 
employers by streamlining and eliminating unnecessary reporting 
requirements.
    In conclusion, small business owners deserve relief from 
rising healthcare costs. The folks that I work with are not 
distant CEOs, but rather hard-working Americans betting on the 
promise of the America dream. They are in their communities, 
they go to church and school activities with their employees, 
and their neighbors, who are also their customers who they care 
deeply about.
    If small businesses thrive, we all thrive. Thank you for 
your attention to this important matter, and for allowing me to 
testify today.
    [The Statement of Marcie Strouse follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
    
    
    Chairman Good. Thank you, Ms. Strouse. Now we will hear 
from and recognize Ms. Corlette.

        STATEMENT OF MS. SABRINA CORLETTE, J.D., SENIOR 
          RESEARCH PROFESSOR, CENTER ON HEALTH INSURANCE 
          REFORMS, GEORGETOWN UNIVERSITY'S HEALTH POLICY
          INSTITUTE

    Ms. Corlette. Thank you, Chairman Good, and Ranking Member 
DeSaulnier. It is an honor for me to be part of today's 
discussion of policies to help reduce health care costs for 
working people and their families. In recent years, Congress 
has made several attempts to improve health care access, 
affordability, and quality.
    None has had a greater impact than the Patient Protection 
and Affordable Care Act. Today, Americans with employer-
sponsored insurance take for granted the many protections that 
they enjoy under the ACA, including protections for people with 
pre-existing conditions, coverage for young adults, cost-free 
preventive services, and caps on our annual out-of-pocket 
costs.
    More recently, the Consolidated Appropriation's Act of 2021 
now protects 177 million consumers from unexpected, surprise 
medical bills, and helps empower employers to be more effective 
purchasers of health benefits. Last year, the Inflation 
Reduction Act helped advance the coverage and affordability 
gains under the ACA and is lowering prescription drug costs for 
Medicare enrollees. However, challenges remain.
    Since 1999, employee contributions to premiums have 
increased by about 300 percent. Average deductibles for a 
single worker have risen from $303.00 in 2006 to $1,562.00 in 
2022. The primary reason for the affordability challenges in 
employer-sponsored insurance is rising health care prices.
    On average, commercial insurers are paying twice the amount 
that Medicare pays for the same service. In some markets, three 
times the amount. There are a number of reasons for this. 
First, consolidation in the health care sector is granting 
providers with outsized market power to demand higher 
reimbursement rates.
    Second, a lack of price transparency has left many 
employers in the dark about what is driving cost growth. Third, 
many of the third-party vendors and brokers that employers use 
to shape and administer their health plans have financial 
incentives to keep health care costs high.
    Employers cannot solve the affordability crisis in health 
care alone. They need support from policymakers. Unfortunately, 
three of the four concepts under consideration today do not 
address the cost drivers in our system. They simply shift the 
burden of cost growth to employers with older, or less healthy 
workforces.
    First, association health plans. The primary way that AHPs 
will offer lower premium rates is through the exemption from 
ACA rating regulations. This enables them to cherry pick 
healthy employer groups out of the ACA regulated market. AHPs 
just create new winners and losers, with the losers being those 
who are older and sicker.
    Second, the Self-Insurance Protection Act. This proposal 
would further encourage the proliferation of level-funded plans 
in the small group market, posing two primary risks. First, 
many small employers may be exposed to unexpected financial 
liability when they self-fund their plan.
    Second, if small employers with younger, healthier 
employees shift to the level-funded products in significant 
numbers, it leaves employers with older and sicker workers 
behind. This causes adverse selection where premium rates rise 
for employers whose groups cannot pass the stop loss issuer's 
underwriting.
    Just as with AHPs, this legislation does nothing to address 
the underlying reason why there is an affordability crisis for 
ESI--the prices that commercial insurers pay for provider 
services and prescription drugs. Third, the Telehealth Benefit 
Expansion for Workers Act. Let us be clear. There is nothing in 
Federal law today that prevents employer group health plans 
from covering telehealth services.
    Indeed, 96 percent of large firms already do so. Employers 
are struggling to afford the rising cost of health care. This 
is indisputable. Encouraging the proliferation of stripped-down 
telehealth benefits, in lieu of a group health plan, will 
discourage care coordination. They do not cover basic things 
like hospitalization, prescription drugs, and labs, and they do 
not have to comply with consumer protections or mental health 
parity.
    Last, I want to thank the subcommittee for attempting to 
roll back a hospital billing practice that is driving up costs 
for employers and enrollees alike. The facility fee proposal 
before this subcommittee is a step in the right direction. 
Thank you for your time, and I welcome your questions.
    [The Statement of Ms. Sabrina Corlette follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
    
    
    Chairman Good. Thank you, Ms. Corlette. Finally, we will 
recognize our fourth witness, Mr. White.

      STATEMENT OF MR. JOEL WHITE, PRESIDENT, COUNCIL FOR 
              AFFORDABLE HEALTH COVERAGE (CAHC) 

    Mr. White. Thank you, Chairman Good. There we go. How is 
that? Thank you, Chairman Good and Ranking Member DeSaulnier 
for inviting me here to testify on the ways to reduce 
healthcare costs for working Americans and their families. My 
name is Joel White, I am the President of the Council for 
Affordable Health Coverage.
    We are a coalition effort with a single focus of reducing 
healthcare costs for all Americans. While I address specific 
issues in my written testimony around association health plans, 
and self-funded arrangements, I would like to spend a few 
moments on the bigger picture.
    I think we need to end policies that drive up costs for 
employers. Enact reforms that drive down costs for working 
Americans. In my mind, this is the most important issue since 
most people, about 160 million Americans, get their coverage 
through their job. This is more than the total enrollment of 
Medicare, Medicaid and Obamacare combined.
    Workers like their benefits. A lot. They want to keep their 
coverage, and they want to improve it, not replace it with a 
government run healthcare program. I think this issue is also 
important because businesses and their employees can no longer 
shoulder the burden of skyrocketing costs. The average cost of 
a family plan today is about $22,000.00.
    Costs have increased 288 percent over the last 20 years, 
consistently outpacing wages and inflation, making health 
coverage less affordable. That is not sustainable. I do not 
think it is any secret that the path to single payer healthcare 
runs through the small group market, and 90 million workers in 
small businesses are a soft target.
    Under the Affordable Care Act, moms and pops are burdened 
by costly healthcare taxes and regulations that do not apply to 
large group plans. Only one-third of small businesses can even 
offer to afford to provide coverage. Those that decide to offer 
a company plan must then face unfair competition from the 
government.
    They cannot complete with zero premium Obamacare and 
Medicaid plans bankrolled by U.S. taxpayers. Subsequent 
regulations have weakened the employer firewall, enriched 
subsidies have lured healthy workers into free coverage. This 
is a classic, predatory pricing scheme. It makes it unrealistic 
for paycheck-to-paycheck workers to choose private coverage, 
even when premiums are reasonable.
    According to a recent survey by NFIB, equal numbers of 
small business owners now get healthcare through the government 
as they do through private insurance plans. All totaled 12 
million small business workers now populate government-run 
safety net programs.
    Some would call this a success, but in Obamacare these 
workers face deductibles that are twice as high as in the small 
group market, and three times higher than the large group plan 
average. In both Obamacare and Medicaid, patients often 
struggle to find a doctor who will see them.
    Millions have a government insurance card but cannot access 
the care they need. This is in fact, a disaster for those who 
support lower cost, private coverage, and want to preserve 
government safety net programs for the truly needy.
    Polls consistently show that what employees want in 
healthcare is affordable employer benefits options, and they 
want their insurance to work better meaning lower out of pocket 
costs, and better access to doctors and drugs.
    Congress should remove barriers that make it harder to get 
coverage at work. There are three things you can do. First, 
expand choices for employers and their employees. Second, 
provide financial incentives to ensure employer coverage 
remains viable. Third, enact policies that lower the cost of 
health services and drugs.
    In terms of the first bucket, Congress should enact 
legislation to create new association health plans, which allow 
more employers to band together to pool risk and get a better 
deal. This could reduce premiums by up to 30 percent. You 
should also create a level playing field by ensuring small 
businesses can access the same policies as large businesses, 
including self-funded arrangements.
    Congress should also allow stand-alone telehealth coverage 
for workers, a benefit that expires when the public health 
emergency ends in 2 weeks. To provide financial help, Congress 
should reform the small business healthcare tax credit so it is 
just as easy for mom and pop workers to get coverage from 
employers as it is in Obamacare and Medicaid.
    Finally, to lower costs, Congress should end dishonest 
billing practices that allow hospitals to charge facility fees 
and higher prices for services delivered in physician offices. 
These reforms should be bipartisan. When Obamacare passed, its 
authors took great pains to argue employer coverage would 
remain intact. What we have seen since is a war on employer 
coverage.
    Congress needs to take steps to end that war. Thank you for 
your time. I look forward to answering your questions.
    [The Statement of Mr. Joel White follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
     
     
    Chairman Good. Thank you, Mr. White. Under Committee Rule 
9, we will now question witnesses under the 5-minute rule. I 
will wait to ask my questions at the end, and therefore 
recognize Mr. Walberg from Ohio for 5 minutes.
    Mr. Walberg. I am going to let you do that over, Mr. 
Chairman. I appreciate your comedy.
    Chairman Good. Oh, Michigan. Of all things to say, Ohio 
versus Michigan, sorry to my early morning workout warrior, Mr. 
Walberg, from Michigan.
    Mr. Walberg. That is a Buckeye mistake.
    Chairman Good. We fly over there.
    Mr. Walberg. I am glad to see Iowa there. I have got a twin 
brother living in Iowa, so. Thank you for allowing me this 
opportunity. I would like to thank the Chair and our panel of 
witnesses for joining today's important discussion. An 
important discussion that has gone on for too long and needs to 
come to a solution that I think we are working, and I think we 
are talking about that today.
    The high cost of healthcare remains a struggle for small 
businesses, many of whom are facing lingering hardships from 
the pandemic as well as inflation, which is a tax on everyone. 
Association health plans are a commonsense solution that 
empowers small employers, and their employees when making 
health coverage decisions by providing small businesses with 
greater bargaining power.
    It allows them to offer more quality options for workers at 
a better price. That is what we are looking for. The 
Association Health Plans Act will expand pathways to more 
affordable healthcare for small businesses and entrepreneurs 
across the country.
    The other bill that I am pleased we are discussing is H.R. 
824, the bipartisan Telehealth Benefit Expansion Act, which 
continues employer's ability to offer stand-alone telehealth 
benefits to their employees, especially part-time and seasonal 
employees, who would not otherwise be enrolled it the 
employer's medical plan.
    Telehealth was a lifeline for millions during the pandemic, 
and has the potential to alleviate provider shortages, 
especially in mental health and behavior health. The last 
Congress I was proud to partner with my friend, the late Jackie 
Walorski, as she spearheaded congressional efforts to expand 
telehealth.
    I am honored to take up this bipartisan bill with 
Representatives Bean, Allen, Craig, Estes, and Sherrill, and 
hope we can advance this bill in Jackie's memory and for the 
benefit of needs out there in the community. Ms. Strouse, large 
businesses can offer lower cost plans to their employees 
because their size allows it, and they enjoy economics of 
scale.
    The administrative efficiencies, and the negotiation clout. 
In your experience, how would expanding association health 
plans for employers level the playing field for small and mid-
size employers, and lower costs?
    Ms. Strouse. Yes. Well, I think we can all agree options 
are great. The more we can put on the table for employers to 
actually be able to access is a good starting point. In the 
association plan space, the large employers have the ability to 
bill based on the number of lives they have, the risk that they 
can spread across that.
    When you look at association health plans, this has that 
same idea behind it. Once you get into that larger space, you 
actually have more access to carriers. You have more access to 
plans you have more flexibility with customizing those benefits 
for your employees. That is just one big thing for us looking 
at how out of pocket maximums have been going just through the 
roof.
    I mean right now the average out of pocket maximum is 
$9,000.00. That is not sustainable. When we look at the 
association health plans with specific guardrails, which I 
think have been outlined in this bill, it gives those employers 
the ability to actually feel like a large employer, but then 
each employer is actually looked at within their own risk.
    In the situation where maybe you do have an older 
population, or you might have some people that have some health 
issues, you still have that big, large pool that is helping 
that situation. You still have that risk that is being spread 
apart, but then those employers are still specifically looked 
at on their own, so they could have a rate.
    Mr. Walberg. Safety and security, and flexibility.
    Ms. Strouse. Absolutely. What we do see in these types of 
benefits are more robust benefits, so yes.
    Mr. Walberg. Thank you.
    Ms. Strouse. Yep.
    Mr. Walberg. Mr. White, Ms. Corlette's testimony alleges 
that association health plans may offer low so-called teaser 
premium rates to cherry pick health employer groups. Does the 
Association Health Plans Act allow for teaser premium rates?
    Mr. White. It does not. In fact, it sets a rate for the 
entire group, and if there was a teaser rate offered, that 
would be considered not actuarily sound, which the bill 
actually requires, so teaser rates are not authorized by this 
bill.
    Mr. Walberg. We do not want to tease.
    Mr. White. We do not want to tease.
    Mr. Walberg. We want the experience to be good and 
productive.
    Mr. White. That is right.
    Mr. Walberg. Let me move over to the telehealth benefits. 
Mr. Watts--Ms. Watts, excuse me, Mrs. Watts, what type of 
employers currently offer stand-alone telehealth benefits?
    Mrs. Watts. I have a couple of examples of our clients that 
do this. One is a national convenience store chain, that is 
very similar to the restaurant chain that I mentioned. A 
private daycare preschool employer, and a K through 12 employer 
who need teachers in the classrooms, and they just want to be 
able to continue doing business, and providing something that 
is valuable, and they have very low take up rate of their 
insurance, and so it is super valuable.
    Then we have got like a smaller landscaping company. It is 
kind of a transient workforce, lower paid, and they just feel 
like they needed to do something, and so it was a way to 
provide that care.
    Mr. Walberg. Better health, better opportunity. My time has 
expired. I will submit further questions for the record. Thank 
you.
    Chairman Good. Thank you, Mr. Walberg from Michigan, and we 
will now recognize our Ranking Member, Mr. DeSaulnier, for 5 
minutes.
    Mr. DeSaulnier. Thank you, Mr. Chairman. Well again, thank 
you for having this meeting. As I mentioned in my introductory 
comments, I am a former small business owner having owned 
restaurants in California, including places like San Francisco 
and Berkeley, California, so you could imagine working with my 
colleagues, sometimes from my perspective, might have been a 
challenge.
    I was successful at it. I was also a long-time member of 
the NFIB, although I think when I was in the legislature you 
might have terminated my membership. I was also a member of the 
California Restaurant Association. Ms. Corlette, as a small 
business owner, I can see the benefit of banding together for 
small business.
    I agree with much of the comments. Getting it right, to 
make it work for everybody, and human nature being what it is, 
a lot of the proposals allow for people to manipulate what 
should be a benefit for everybody. Could you comment a little 
bit about how we could get association and pooling together, 
like people like the California Restaurant Association for 
small members to get the benefit that large employers get, 
under the ACA.
    Ms. Corlette. Thank you, Congressman, and first of all, I 
want to say that I think the Chairman and the other witnesses 
that I am here with. We are all, I think, equally concerned 
about the burden of health care cost for small businesses. They 
really are hindering competitiveness and threatening the 
financial success of small businesses.
    With respect to association health plans, the concern that 
I and many have is that they offer lower premium rates to small 
groups when they are permitted to adjust rates based on each 
small employer's health status or age, and if they do not have 
to participate in the Affordable Care Act single risk pool, or 
risk adjustment programs.
    This means that they can use underwriting practices to skim 
off the healthier, small employer groups, and they can offer a 
lower rate because they are paying less in health care services 
because it is healthier groups, leaving in the ACA market small 
employers who have older workforces, or who have workers who 
are not as healthy.
    This leads to what we call an adverse selection problem in 
health insurance, which means that premiums start to go up and 
up for those employers who are not as healthy as the ones 
attracted to the AHP.
    Mr. DeSaulnier. That was the case, but worse before the 
ACA, particularly in the restaurant business, because younger 
employees, and I was one once, when they first start, many 
times when they are still going to school, do not want to pay 
for health care. I had young employees who said, why do I have 
to pay anything, and you only pay a portion of it?
    I prefer just to get a raise, a wage increase. The ACA is 
trying to address that, and I would not say it is a finished 
product by any stretch of the imagination, so hopefully we can 
work on it together. Let us talk about telehealth, first on the 
medical side. Now as a survivor of stage four cancer, and a 
consumer continuing with an immune system that needs constant 
attention, telehealth can be a benefit.
    I agree, particularly in rural areas, multiple benefits. 
Again, getting it right, and having a rational, less 
ideological conversation. As a survivor of cancer, I do not 
care what registration or ideology my doctor is, as long as he 
keeps me alive.
    Here is an example of where I think we could work in good 
faith, acknowledging we start at different perspectives. Tell 
me about some of the pitfalls as you see it, as you have 
already explained in the beginning, particularly about being 
transparent, so people understand that telehealth could be a 
component in medical health, and maybe you can add a few 
comments about on the behavioral health side. Again, where I 
could see a great benefit, and have seen personally a great 
benefit.
    Ms. Corlette. Sure. Absolutely. It is very clear that 
employers and employees highly value the delivery of health 
care services through telehealth. As I mentioned in my 
statement, 96 percent of large employers already offer some 
coverage of telehealth, and a vast majority of them think that 
the use of telehealth by their employees is likely to increase 
over time.
    Employers are committed to covering telehealth services, 
and they see it as a really important part of their employees' 
health benefits. My concern with creating a telehealth benefit 
as an ``excepted benefit'' under ERISA is that it carves it out 
from the employee health plan, siloing it from major benefits.
    It exempts it from all Federal regulations, including 
mental health parity, Affordable Care Act protections, and it 
leaves people without those protections. We have also seen with 
other excepted benefits such as fixed indemnity, that quite 
often these benefits are marketed to consumers in deceptive and 
misleading ways, leading them to believe that they are getting 
comprehensive health insurance, when they are actually getting 
a product that does not provide financial protection.
    Mr. DeSaulnier. Thank you. My time is up. Mr. Chairman, I 
look forward to working with you on these issues because I hope 
you can tell from my comments, although I strongly disagree 
with many of your perspectives, I think there is an opportunity 
here to accomplish some real good for the American public. 
Thank you. I yield back.
    Chairman Good. Thank you, Ranking Member DeSaulnier, and 
now I recognize Chairman Virginia Foxx from North Carolina.
    Mrs. Foxx. Thank you, Mr. Chairman. I thank our witnesses 
for being here today. Mrs. Watts, most Americans were covered 
by employer sponsored insurance are satisfied with their 
coverage, yet our Democrat colleagues continue to push the 
expansion of government run, one size fits all healthcare 
programs. Can you discuss the benefits of employer sponsored 
insurance as compared to plans on the Obamacare exchange?
    Mrs. Watts. Of course, Chairman Foxx, I would be happy to. 
First of all, the benefits that are provided by employer 
sponsored plans for the most part are much better than those on 
the market. The deductible levels tend to be lower, and the 
out-of-pocket maximums are lower. In addition, the 
contributions are lower, even with the government subsidies for 
many people with employer sponsored health plans.
    I think one thing though that we maybe lose sight of is 
that the networks that the employers plans use tend to be a 
broader network of providers, and so it is not a narrow 
network. It gives members more choice of where they can seek 
care. One thing that is kind of near and dear to my heart is 
innovation. Employers are always looking to spend less and do 
more with their benefit packages. I think they really push the 
market, and they go after the new up and coming things that are 
available.
    They are more quick to adopt those things, and they are not 
just, you know, caught up in a lot of regulatory barriers. 
Then, you know, I will say that employers work hard to offer, 
you know, a curated choice. They typically offer three or four 
benefit options. You know, there is a lot to choice 
architecture, and you can overload somebody with choices, and 
it becomes overwhelming, and they cannot decide what plan they 
want to be in.
    I think the idea of meaningful choice is very important to 
employers. The last thing I will say is that we do a survey 
worldwide of workers, and when we ask them whether or not they 
agree that their employer cares about their health and well-
being, 66 percent of workers globally say that their employer 
cares about their health and well-being.
    In the U.S. it is 75 percent of workers feel that their 
employers care about their health and well-being, and I think 
that that's a big part of why employers offer healthcare 
benefits.
    Mrs. Foxx. That is great news. Your comments mirror my 
experience in hearing from constituents. They hate Obamacare, 
and the government run programs because they are not flexible. 
Mr. White, Ms. Corlette wrote in her testimony that expanding 
access to association health plans, and tools that employers 
need to self-insure, such as reinsurance, will shift costs to 
the individual in fully insured market, and will result in 
employers offering worse coverage.
    I think we have even heard those comments today. Do you 
agree? Why? Or why not?
    Mr. White. Yes. I disagree. I think our first goal should 
be to expand choices and options for employers, but I think the 
assumption is that healthy people will be the ones to switch, 
and that Will destabilize both the individual and the large 
group market, and we just disagree with that.
    In fact, we think that there's a couple reasons for that. I 
think AHP's will actually be a richer set of benefits for 
people. First, I think the wider provider networks, more access 
to doctors and drugs and hospitals. We see a very narrow 
network on the ACA.
    The second reason is I think AHP's will provide lower 
deductibles, and we see very high deductibles in Obamacare. 
$4,500.00 is the average in 2021. It is less than twice that in 
the small group market, so less cost sharing. That will attract 
people who have some claims experience, that have health 
conditions, right?
    It is not going to be all the healthy people, it would be a 
mix of risk.
    Mrs. Foxx. Right.
    Mr. White. Which means that risk will be pulled together, 
rates will be driven down because you have a larger risk pool, 
and people will experience lower premiums, but there are no 
subsidies in these AHP's or self-funded plans, to attract that 
healthy risk.
    A lot of that healthy risk will continue to choose 
Obamacare, where the subsidies are very, very, very generous. 
So that is most of the reasons.
    Mrs. Foxx. Thank you very much. Ms. Strouse, do you agree 
with Ms. Corlette's statement that ``many small employers are 
not sophisticated purchasers of the health benefits, and may 
not realize the financial risk and fiduciary duties they take 
on when they self-fund their plan.'' Why or why not do you 
agree?
    Ms. Strouse. Well, I would say probably the majority of 
Americans are not sophisticated buyers of their health 
insurance, so this is the role of the insurance agent. This is 
why having an agent is so important today because we are 
looking for options across all lines, and in some cases that is 
actually using the marketplace as an option for small employers 
and group products.
    Mrs. Foxx. Well, let me add to that. I think the left's 
attitude toward us as individuals, and to small business is 
very negative. They think we are all a bunch of dumb people who 
do not know how to make decisions for ourselves, that is why 
you need the government to do everything for us.
    The Life of Julia shows, you know, government takes care of 
everything. I think it is a real slam on small businesses. My 
husband and I had a small business. My daughter runs a small 
business. Every small businessperson I know is very bright, and 
could not stay in business if they were not bright, and had to 
figure out how to get things done. I think this kind of 
attitude is an attitude that exists among Democrats and the 
left, and it really is terribly offensive to me. Thank you very 
much.
    Chairman Good. Thank you, Chairman Foxx. Now I would like 
to recognize Congresswoman Wild from Pennsylvania for 5 
minutes.
    Ms. Wild. Thank you, very much Mr. Chairman. Let me just 
start by saying that it always dismays me the amount of vitriol 
and partisanship that we experience when we are even engaging 
in discussion and debate about health care in America. It is 
really a shame.
    I think the one thing we could probably all agree on is 
that we are fortunate to have some of the best medical 
providers and hospitals in the world right here in the United 
States. It would be really nice if we could all come together 
behind making sure that every single American can afford these 
outstanding providers that they often need, but cannot afford.
    One of my major goals in Congress, I will tell you I have 
been here since the beginning of 2019. This is my third term. 
One of my major goals is to try to find paths for 
bipartisanship, bipartisan bills that we could work on that 
will advance this cause.
    I will be very open to any suggestions that any of the 
witnesses might have about that. Before I open it up to that, I 
just want to say that one of the things that I am proud of that 
we were able to do on a very bipartisan basis in 2020 was to 
advance legislation to protect consumers from surprise out-of-
network bills, and ultimately passing the No Surprises Act.
    I personally in my family have seen the advantages of that, 
and I have talked to many others who have. Ms. Corlette, let me 
just start by asking you what your thinking is, what your 
knowledge is of how the No Surprises Act has made health care 
more affordable for consumers?
    Ms. Corlette. Sure. Yes. Thank you for the question. As you 
know, the No Surprises Act protects people with insurance in 
certain situations when they really have no choice of 
providers, so those are emergency situations, and also if they 
are getting care at an in-network facility, they have done 
their homework, and they have made sure to go to an in-network 
hospital, and yet they are treated in some way by an out of 
network clinician, that can be an anesthesiologist, or a 
radiologist.
    Ms. Wild. I am sure there is no person around who has not 
received a bill at some point in time, looking at it and saying 
I do not know who this doctor is. I do not know when I received 
this case, except for the date on the bill, and that is very 
frustrating for everybody.
    Ms. Corlette. Right. Absolutely. The law went into effect 
last year, so we are about a year plus into it, and the good 
news is that it is working as intended. 177 million people now 
can have peace of mind that if they have an emergency, or if 
they are in a hospital that they know is in-network, they are 
protected from those surprise medical bills, so good news.
    Ms. Wild. The one thing I would note on that is that I 
believe, if I am not mistaken, that we still have a lot of 
problems in terms of people who require ambulance service, EMS 
not being covered in-network, and I have talked to EMS 
providers in my own district.
    That is an area that I would personally like to see us move 
forward in a bipartisan way and try to figure something out. I 
would like to open it up, if any of you have any--I wish I had 
far more than a minute and a half left because this is a really 
important topic, but I would love to hear any ideas that any of 
you might have for other initiatives that we might take on a 
bipartisan basis. I open it up to any one of you.
    Mr. White. I will jump in here. I think that you have 
mentioned one. It is expanding out No Surprises to cover 
ambulance services, huge out-of-pocket costs for a lot of 
people who get surprised, and not covered by the law, right?
    That is important. The other thing I would focus on is 
telehealth. I mean the telehealth bill that we are discussing 
today is bipartisan. There are a number of Democrats and 
Republicans on that. I think what we saw during COVID was 
telehealth really filled the gap. It allowed people to access 
care that they otherwise would not be able to get.
    Ms. Wild. Let me just--I am sorry to interrupt, but I will 
tell you I am a huge fan of telehealth. I actually sponsored a 
bill during COVID to make sure that older Americans had access 
to telehealth. I really am a big fan of it. I have a great 
concern about stand-alone telehealth plans, and whether they 
would be--that people could be misled into thinking they had a 
comprehensive health plan, and when they needed a hands-on 
doctor, they would not have that ability.
    Okay. With 15 seconds left, go ahead.
    Ms. Strouse. I just want to bring up the fact that the cost 
controls are a big thing too, so the site neutral payments and 
facility fees within the hospitals, and buying up all these 
small, little independent providers.
    Ms. Wild. I actually plan to submit a question for the 
record. I knew that I would run out of time on that very issue, 
so thank you very much. Thank you all. Thank you for this 
important hearing.
    Chairman Good. Thank you, Representative Wild. Now we will 
go to Congressman Allen from Georgia for 5 minutes.
    Mr. Allen. Well, thank you, Mr. Chairman and Ranking 
Member. I miss sitting beside you by the way, those were some 
good hearings we had back in the day, but it is good to be here 
this morning. I come from the business world. I was in 
business, still my wife is in business now, I tell people a lot 
on a Tahoe and a Member of Congress, but yes, I served because 
I was involved in healthcare. I was Chairman of a hospital 
board for 9 years.
    I was asked to serve on the Healthy Future Task Force. I 
will tell you what I learned is this government is driving up 
the cost of healthcare because the government is driving 
healthcare. Even the private sector has joined forces with the 
government.
    They are all in it together. You know, and I challenge my 
colleagues, you know you talk about anger and vitriol, go to 
the emergency room on a Friday or a Saturday night. You know, 
get out in your districts, see what's going on. You will see 
anger in vitriol like you have never seen it before.
    I personally, feel empathetic to those providers that have 
to sit there and put up with what these people are throwing at 
them, and then they have to take care of them. Unfortunately, 
that is where our country is. In fact, what I found in this 
process in talking to--we talked to hundreds and hundreds of 
professionals, patients, you name it, to try to get to some 
solution here.
    Nobody is happy in healthcare. Nobody. The patients are not 
happy, the providers are not happy, and let me tell you. You 
talk to the American Medical Association we are experiencing a 
severe shortage in providers. That is not going to be good for 
any of us. I ask the question why?
    It is because this government is in charge of your 
healthcare. We have only a government healthcare system. That 
is it. All the privates, all the hospitals, have got onboard, 
and are following it right down the road. Like I said, I come 
from the business world, and what I would like to ask Mr. White 
is this.
    Obviously, the only way to bring down costs is competition. 
Right now, the only people that have a waiver, and our State 
has been trying to get waivers to drive down costs in our State 
of Georgia. We have got waivers from the Trump administration, 
and they were all taken away under the Biden administration.
    We were driving down costs with these waivers. The only 
people that get waivers now are unions and the faith-based 
communities and thank goodness for the faith-based communities 
because they have some programs that are reducing costs for 
families of faith.
    We have to have a private system in this country to compete 
with the government system. That will keep government 
accountable and competitive, because right now it is the wild, 
wild, west, and we are going to--and it is unsustainable. Mr. 
White, what are your recommendations?
    Mr. White. I think you highlighted the problem excellently. 
I think the fallacy is that people think that we have free 
market healthcare in the United States. We do not. We have 93 
percent of all health markets that are highly concentrated, 
that means they lack competition for services, providers, 
doctors, hospitals, et cetera.
    In those markets consumers pay much higher prices. One of 
the reasons is we have a lack of enforcement from government 
bureaucrats and agencies. The other reason is that we really 
have done a poor job explaining what free market health 
coverage is.
    I think you are starting to take some of those steps here 
today to talk about competition.
    Mr. Allen. Yes.
    Mr. White. Letting people band together to get big pools to 
negotiate lower rates.
    Mr. Allen. Exactly.
    Mr. White. Look, Costco and Amazon can negotiate a lower 
price because they are really big.
    Mr. Allen. You give the business community a waiver? They 
will fix healthcare in this country. Quality will go up, 
providers will come back because they do not have to deal with 
the force of this Federal, and the oppression of this Federal 
Government.
    Mr. White. Congressman, I am going to say one more thing. 
Fifty cents of every dollar spent on healthcare comes from 
Washington, DC.
    Mr. Allen. Yes.
    Mr. White. Every entity in healthcare is regulated at some 
level, local, State, Federal, by regulations, and so they are 
constrained in what they can do and offer. What we are talking 
about today is flexing that upwards a little bit.
    Mr. Allen. Yes. I have got to add one thing. I asked the 
question to every one of these professionals. Can you break 
down the cost of healthcare for me? Peel the onion. That way I 
can figure out where the money is going. Not a single one of 
them can do it, and with that, Mr. Chairman, I yield back, and 
that is the only way we are going to get to the bottom of this 
because somebody is on the take here. Thank you.
    Chairman Good. Thank you, Congressman Allen. Now we will 
recognize Congressman Courtney from Connecticut for 5 minutes.
    Mr. Courtney. Well, thank you, Mr. Chairman, and thank you 
for the witnesses for being here. I would like to start and 
followup with some questions with a basic sort of fact, which 
is that really, just months ago, we finally enacted a cap on 
insulin for Medicare patients.
    Again, this is a drug that is been off patent for over 100 
years. I mean any sort of argument that it needed to be priced 
two or three times higher than, you know, what people pay in 
Europe, or other parts of the world, you know, because we got 
to support R&D I mean is, you know, absurd when you talk about 
a drug like that.
    You know, which again it has been off patent. Again, 
starting on January 1, Medicare patients are now paying no more 
than $35.00 a month for their insulin refills. I have friends 
in my district who say that is one-third of what they were 
paying before. When we passed the bill initially in the House, 
it actually extended that benefit to you know, working age 
individuals in their employer-based plans.
    We unfortunately came up, I believe it was about three 
votes short in terms of overcoming the 60 vote threshold in the 
Senate, and you know, to me you know, that just sort of is 
blindingly obvious, that is a way of helping reduce the 
overall, not just that specific drug, but also the overall 
costs, and frankly we need to look at that deeper.
    In Connecticut we just raised, we just had approval of 
small group plans, I think there is about 12.9 percent in the 
State of Connecticut, Department of Insurance. They identified 
prescription drug costs as the No. 1 cost driver in terms of 
what is making premiums go up.
    Again, it is not because of the fact that we do not give 
the government enough authority to negotiate a better price, 
like we did with insulin, it is because we do not do enough of 
that. Again, you know, I just would ask Ms. Corlette, to just 
sort of comment on that. That if we are really serious about 
reducing costs, we have got to look at what insurance plans 
actually pay for, and try to figure out ways to reduce those 
costs.
    Ms. Corlette. Thank you, Congressman, for the question. 
Yes, the Inflation Reduction Act made great strides in 
improving prescription drug affordability for Medicare 
enrollees but stopped short of extending that help to people 
with employer-based or commercial insurance.
    A recent analysis by the Kaiser Family Foundation found 
that capping insulin at $35.00 a month for people with private 
health insurance would provide financial relief to about 20 
percent of employees, and for people who pay currently more 
than $35.00 per month for insulin, half of them would save at 
least $19.00 a month, and 25 percent would save at least $42.00 
a month, so really significant savings.
    Mr. Courtney. You know, it is interesting because we are 
about to vote I guess this week on this debt ceiling plan, 
where huge pieces of the Inflation Reduction Act are being 
gutted for energy tax credits. It appears that the majority has 
kind of kept hands off the insulin price.
    I mean again, I am not sure of that for a fact, but we will 
maybe find out more, but I mean to me that speaks volumes about 
the fact that it is just an undeniable policy advance in health 
care, which is to use the negotiating authority of Medicare, 
which is the second largest health plan in our country to 
really get, you know, a better deal in terms of what the 
taxpayer has to underwrite, as well as what the patient has to 
pay.
    Again, the bill goes on though. It is not just about 
insulin, it also is going to cap out-of-pocket for anyone on 
Part D over a time period. I met with MS patients, multiple 
sclerosis patients, who are now getting injection treatment 
where, despite the fact that they are affluent, even good 
insurance, they are just totally hammered by the cost of that, 
and most of them end up on Medicaid. They were in tears with 
gratitude for the fact that Congress did what we did in the 
Inflation Reduction Act, which was putting an overall cap, 
again, that will apply to their predicament.
    Again, if you could Ms. Corlette, comment on that. We are 
talking about a broader universe of savings.
    Ms. Corlette. That is right. I think expanding, leveraging 
the negotiating power of a large purchaser like Medicare to 
deliver savings to employer-based plans for high-cost 
prescription drugs will trickle down to savings for workers and 
their families. Then the other protections in the IRA, 
particularly related to that cap on out-of-pocket would also be 
incredibly helpful for a lot of families. Thank you.
    Chairman Good. Thank you, Mr. Courtney. Now we will 
recognize for 5 minutes, Congressman Banks from Indiana.
    Mr. Banks. Thank you, Mr. Chairman. There are nearly a half 
a million small businesses in Indiana that employ over 1.2 
million Hoosiers. Ms. Strouse, you wrote that 98 percent of 
small businesses report that healthcare cost will become 
unsustainable in the next 10 years, threatening their ability 
to survive and remain competitive.
    I wonder if you could just be more specific and explain to 
us what are some of those main drivers of those costs that you 
are talking about?
    Ms. Strouse. Yes. Thank you for that question. I am going 
to continue on that pharmacy topic that we just opened up, and 
I love the starting point of addressing some of these insulin 
prices. When you negotiate on Medicare only, most of the time 
those drug manufacturers actually move those prices somewhere 
else. It gets moved into the private market, and so that 
becomes challenging.
    Right now, 25 percent of premiums are driven by your 
prescription cost, and caps again sound lovely, but why are we 
not going to the drug manufacturers and making sure that those 
insulin prices are affordable for everyone across the board? So 
those are the conversations that need to be had, and if we do 
not address those, then that right there is a huge factor.
    Our specialty medications are driving the majority of our 
claims that are coming in, and most of those people are seeing 
commercials on TV, and they are walking into their provider's 
office and asking for those specific medications. I have an 
employer right, now that 91 percent of their prescription costs 
are driven by ten specialty medications.
    It is a huge spend for them. I would say that is first and 
foremost, and then the hospitals site neutrality payments. We 
love our providers. We have to have them. We live in a very 
rural State, and it is super important to make sure that doors 
are open. After the ACA rolled out there was a ton of 
consolidation, and so we saw a lot of private, individual 
practices move into that hospital's system.
    Our doctors have lost the ability to care for their 
patients the way that they were, went to school, and the 
reasons that they went to school. We need to make sure that 
everybody is taken care of. That when people are going in to 
have a test within the same system that the test costs the 
same, regardless if you are in small town Iowa, or if you were 
in Des Moines at a hospital system.
    Those are two things that I think are driving the costs 
that I believe that Congress can actually do something about. 
You know, really just more access and options, getting 
association health plans out there, having that ability for 
employers to make choices for themselves and for their 
employees.
    Mr. Banks. Your State is a lot like my State, and maybe 
expand on that a little bit. Talk about how we got to this 
point where small businesses feel like they might not be able 
to provide the same level of quality healthcare options for 
their employees as what they used to.
    I mean it seems like that is devastating to the families 
who you have put to work with good paying jobs. It seems that 
would be very disruptive to your ability to do business. How 
did we get to that point?
    Ms. Strouse. Yes. In Iowa specifically, before the ACA 
rolled out, we actually had protection across the board for 
everyone regardless if they had pre-existing conditions, and 
specifically in the employer market. When you came in as a new 
eligible employee into an employer group plan, they did not 
have pre-existing limitations on those plans. If you were 
somebody who chose not to enroll, and a year later decided to 
enroll, there could have been limitations based on that, but we 
had a high-risk pool in Iowa that accepted everyone that got 
denied coverage.
    We had safety nets in place to actually make sure every 
single Iowan had access to care. In that high-risk pool we had 
$500.00 deductibles. Those are unheard of in Iowa today. We 
also saw the age rated bands, the age bands come out, and that 
created first of all, our older population paid more, but it 
did not offset the younger population. Their rates also went up 
where it was on average you could have a young, 20 you know, 
something.
    Their premium could have been $125.00 on average. Those 
premiums went up over $300.00. That is why those young, healthy 
people did not enroll in those marketplaces. When we start to 
get that where everything is just driven by claims, and we do 
not have prevention on the front end of things, that is what is 
driving up costs, that is what is making it unsustainable for 
employers today.
    Mr. Banks. Well, I appreciate you sharing your unique 
perspective. Small businesses are the backbone of our economy 
in states like Indiana and Iowa, and throughout the country, 
and it is my sense that Members of Congress should be listening 
a lot more to people like you a lot more than what they do, so 
thank you. I yield back.
    Ms. Strouse. Thank you.
    Chairman Good. Thank you, Congressman Banks. Now I would 
like to recognize for 5 minutes, Congressman Norcross from New 
Jersey.
    Mr. Norcross. Thank you. At this point, I would like to 
yield 1 minute to my colleague.
    Mr. Courtney. Just really quickly. Ms. Strouse, I just want 
to reiterate the point that I made, which is when the Inflation 
Reduction Act came out of the House, that insulin piece was not 
limited to Medicare. It was extended to, we amended ERISA, to 
make sure that it would be extended to employer-based plans as 
well.
    Unfortunately, Senator McConnell whipped a no vote on that, 
and that provision was stripped because it was ruled by the 
Parliamentarian not to be budget related. It was a policy 
issue.
    The good news is that Susan Collins and Patty Murray are, 
on a bipartisan basis, going to be introducing a bill to do 
exactly what you just described, and which we supported 
already, and hopefully we can all have a nice bipartisan 
kumbaya, and come together and realize that those savings for 
insulin should be extended to working age Americans through 
their employer-based plans. I will now yield back to Mr. 
Norcross.
    Mr. Norcross. Thank you. I appreciate it. I see the actual 
hearing notes says Reducing Health Care Costs for Working 
Americans and their Family. We can do that very easily by just 
cutting coverage. Obviously, any health care has to be 
comprehensive coverage and quality coverage.
    Coming out of the pandemic we have seen just the massive 
impact that COVID has had on the average American, both 
physical and mental health. The question I want to get to is 
the mental health piece of this. Last year, the Department of 
Labor did a study to find widespread violations of the Mental 
Health Parity and Addiction Equality Act.
    In the report, the Department recommends Congress provide 
additional tools to improve enforcement, including granting the 
Department of Labor the authority to issue civil monetary 
penalties for violation. Next month, I plan on reintroducing 
the Parity Enforcement Act.
    When we look at what is in place now, the law says one 
thing, but without any meaningful employment, it is literally 
like having no police on the road and people will just drive 
whatever they want to do. Certainly, we have seen what happens 
when that doesn't work. The violations come flying in.
    Ms. Corlette, what are some of the barriers to making the 
promise of the Parity Act an actual reality, and how could we 
improve the enforcement in making sure that this care is 
available to all Americans?
    Ms. Corlette. Thank you, Congressman. As you said, 
enforcement of MHPAEA is absolutely critical. You know, when 
the Department of Labor recently asked group plans and insurers 
to share their analyses of how they were covering behavioral 
versus medical health services, not a single plan was able to 
submit documentation to enable Department of Labor to even 
assess what they were doing.
    It is a clear sign that plans and issuers may not be taking 
their compliance obligations seriously enough. MHPAEA was 
enacted in 2008. We are 15 years into this. Civil monetary 
penalties certainly could help send a strong message that 
access to mental health services is really vital for workers 
and families. I think it could also be helpful for the 
Department of Labor to provide some guidance, and more clarity 
to plans and issuers about what those obligations are.
    Knowing that there is a cop on the street is absolutely 
critical.
    Mr. Norcross. Again, right now if there is violation, if 
they get caught, they just pay for it. Obviously, from the 
bottom line financially, we tried to allow the market, the free 
market, to go and take care of this. Again, your point, 15 
years. It is not being done. I think this is incredibly 
important. I think everybody on this panel, both sides of the 
aisle understand mental health is a real issue.
    The addictions, the list goes on. The idea that we are 
allowing part of the free market to just go and do what they 
want, and we see the violations is exactly why I think we 
should talk about implementing this, and moving this forward. 
With that, Chairman, I yield back.
    Chairman Good. Thank you, Mr. Norcross. Now I would like to 
recognize Representative Smucker from Pennsylvania for 5 
minutes.
    Mr. Smucker. Thank you, Mr. Chairman. This is a great 
discussion this morning. I would like to thank the Chairman for 
scheduling this hearing, thank the witnesses for being here. I 
would like to thank the Ranking Member, and other members from 
the other side of the aisle for some of the comments that they 
have made in regards to the common ground that we have on these 
issues.
    I think we are all interested in ensuring that every 
American can access the great healthcare system that we have 
here. We have differences about how we can best deliver that, 
but we have great discussions here today about potential 
solutions. I will use the term that the Democrats are often 
fond of, universal healthcare.
    I would like to see universal healthcare. To me, that means 
that everyone can manage their healthcare expenses by having 
access to insurance if they want that access to insurance, and 
hopefully at a price that they can afford. We believe it can 
best be done by competition among providers, competition among 
hospitals, competition among insurers.
    We think a system with that in place will deliver the best 
change of ensuring that access. I read about a 200 employee 
construction company, self-insured, and you have all talked 
about the benefits of self-insured, some of the problems with 
the red tape around that, the flexibility that it can provide, 
and so I just want to mention the benefit that I saw of also 
creating partnerships between employers and employees to 
improve healthcare, or improve health of employees, and reduce 
costs.
    It was a shared risk in that, and then I have seen 
telehealth in my district. I have heard some of the concerns 
about telehealth, and I do not--it is the first I heard some of 
them because I have always seen telehealth as being sort of 
better access to healthcare. Part of a larger system, and 
literally helped to improve outcomes because patients tended to 
go to a doctor sooner, and maybe take care of a health problem 
before it became larger.
    I have also seen, and I want to ask this question, and 
maybe Mr. White, I will ask you. We have some very innovative 
systems by employers in my area where telehealth is part of it, 
but also direct primary care. This is where there is a sort of 
a monthly fee to a doctor, that is then on call for employees. 
Even groups of employers are doing this at times.
    People love it because they can call, rather than missing 
work having to go the distance. They can do telehealth and then 
sometimes the direct care provider will even be onsite if it is 
a large enough company. I have a bill that would help to--I did 
this, introduced it with Mr. Blumenauer, a Democrat from 
Oregon.
    Essentially, it would ensure that employers who have access 
to direct primary care would also have access to HSA's, and it 
would be covered in HSA. Mr. White, are you familiar with that? 
Do you like it? If so, how could we expand direct primary care?
    Mr. White. It is a great idea. I love it. I think it 
expands options for workers to be able to access care on 
demand. It is kind of like the old concept when the doctor 
would come to your home, right, and you would kind of----
    Mr. Smucker. Like a family doctor.
    Mr. White. A family doctor. You would get their attention, 
and their time, and that is what direct primary care seeks to 
offer is that direct attention, that direct time, dedicated to 
that worker so that they have access, good access, to care. I 
think coupling it with HSA's makes a lot of sense, so that 
people can pay any of their cost-sharing obligations.
    Then on the telehealth side, I think you know, one of the 
things that we have seen during the pandemic is really a focus 
on behavioral and mental health issues.
    Mr. Smucker. Absolutely.
    Mr. White. Really, 90 percent of those claims on 
telehealth.
    Mr. Smucker. I want to get to one additional question, and 
I am really sorry to cut you off. Ms. Strouse, you had 
mentioned site neutrality payments, and I have heard from this 
on sort of both sides of the issue if you will, independent 
practices, who literally have gone out of business because they 
have been bought up by hospitals that they could charge higher 
prices. It is a system that we have in place that I think 
encourages that kind of consolidation, which I think then 
reduces competition.
    On the other hand, I have great hospitals in my area who 
argue that they face unique circumstances that justify the 
increased price of services, and I would just like you to 
address that. Like how do you talk about that? How do you 
respond to hospitals that you are arguing that these higher 
prices are justified?
    Ms. Strouse. Yes. I am not--I am definitely not arguing 
that they are not seeing increased prices. Everyone in the 
country is experiencing increased prices across the board. I 
think what we want to get to is an easier, more transparent 
system so that if you are having a lab test in one clinic, and 
the same exact lab test maybe at a different facility, that it 
should be the same price.
    We had a member that came forward in Indiana, and they--he 
and his wife both had exactly the same lab test. One had it at 
a clinic, one had it more through a hospital setting. His was 
$900.00, hers was $90.00. We need to make sure that we know 
that the price is the price. That type of thing should not be 
different.
    Where we are also seeing some challenges are those facility 
fees. In some of those smaller clinics, now we are starting to 
see a facility fee be added on top of services that really 
there should not be a facility fee charged on. We recognize our 
hospitals are also struggling. We are doing everything we can 
in the State of Iowa to make sure that all of our rural 
hospitals are getting what they need.
    Another piece of that is Medicaid, and the Medicare market. 
The reimbursements are not great, and so the private market 
literally holds them up. I have actually had a client who is a 
mental health provider, and she was contemplating lowering the 
amount of patients she was seeing in Medicare and Medicaid, 
just to keep their doors open, and it was a heart wrenching 
situation for her.
    Reimbursements across the board, we need to get that 
figured out, so that it is there for everybody.
    Mr. Smucker. Thank you. Thank you, Mr. Chairman.
    Chairman Good. Thank you, Congressman Smucker. Now I would 
like to recognize Representative Hayes from Connecticut for 5 
minutes.
    Mrs. Hayes. Thank you very much. The Affordable Care Act 
dramatically expanded the affordability of health care for 
millions of Americans. As of January 2023, a record 16.3 
million people were insured under the ACA. Additionally, last 
Congress, Democrats took bold action to reduce prescription 
costs by passing the Inflation Reduction Act, which grants the 
HHS Secretary the authority to negotiate the price of 
prescription drugs covered by Medicare, and caps out-of-pocket 
costs for insulin at $35.00 per month for Medicare 
beneficiaries.
    I have to stress once again that we tried to expand this 
beyond Medicare, and we were stopped by Republicans. I was 
particularly disappointed that we would not be covering 
children with Type 1 diabetes, so it is something that we will 
continue to work toward.
    While we have accomplished so much, there are still changes 
that must be made to make our health care system better. 
Currently, most insurance covers individuals from the neck 
down. Dental and vision health, which are critical components 
of overall health, are not covered.
    Basic insurance health plans rarely cover routine eye 
exams, regular visits to the dentist, or even extended mental 
health services. People without access to dental care are more 
likely to suffer from chronic conditions, such as heart 
disease, diabetes, and cancer.
    In 2023, there have already been 55,000 new cases of oral 
cavity cancers in the United States. Similarly, improving 
access to eye care allows health professionals to identify and 
treat problems before they become more serious. Vision 
screenings improve academic outcomes for kids.
    If we are having a conversation about reducing health care 
costs, it should also be about full and total health care. Ms. 
Corlette, how did the ACA improve dental and vision access, 
especially for children? Can you elaborate on the remaining 
barriers to affordable dental and vision care that we are 
currently facing?
    Ms. Corlette. Thank you Congresswoman, for the question. 
Sure. One of the key things that the Affordable Care Act did 
was establish a set of minimum essential health benefits, which 
included pediatric dental and vision care. For the first time, 
there was a minimum floor that all small group and individual 
market health plans had to satisfy.
    In terms of remaining barriers, I would say No. 1, there 
are ten states that have still not expanded Medicaid under the 
Affordable Care Act, and that places about 1.9 million people 
in something called the Medicaid Gap. They are too poor for 
marketplace subsidies but have too high of an income to qualify 
for their state's very, very, low eligibility.
    The second thing I would point out is that in the employer 
market, dental and vision are sort of the traditional examples 
of excepted benefits. What has happened with these excepted 
benefits, is they end up being siloed, they are separated from 
the general comprehensive major medical benefit that we all 
have. Not only are they siloed out from the rest of your body, 
which is not logical, the benefits do not tend to be very good.
    They do not provide a lot of financial protection. The 
medical loss ratios are quite low. I just point that out in 
part because before you today is this proposal to create 
telehealth as an excepted benefit, which I worry would lead you 
down the same path where the services are siloed from your 
regular health care and are not very comprehensive.
    Mrs. Hayes. Thank you. To your point, I would argue that we 
need to make sure that it is more competitive, so that people 
cannot charge whatever they want to your point, $90.00 or 
$900.00 for the same benefits. In my State of Connecticut, 
531,000 adults have a mental health condition, and many go 
without the necessary care or services to address their 
illness.
    Unfortunately, this reality is felt nationwide, as half of 
adults with mental health do not receive treatment. We are 
facing a crisis. Ms. Corlette, how can Congress expand access 
to mental health care services to those who are in need under 
the ACA and job-based plans?
    Ms. Corlette. Well, one thing your colleague mentioned 
earlier was enforcement. That is an area where there clearly 
needs to be more authority and more resources for ensuring that 
plans are complying with mental health parity. Then just the 
last remaining seconds, I think workforce issues are really 
critical, and my colleague here mentioned the reimbursement 
issues in particular, and making sure that there's 
reimbursement parity for those mental health services.
    Mrs. Hayes. Thank you. Mr. Chair, I yield back.
    Chairman Good. Thank you, Representative Hayes, and now I 
would like to recognize for 5 minutes, Congressman Burlison 
from Missouri.
    Mr. Burlison. Thank you, Mr. Chairman. I worked in 
healthcare IT for 20 years, and I have seen where the bodies 
are buried. I have seen good, the bad, and the ugly, but I came 
to this conclusion that the more that this place touches 
healthcare the worse it gets.
    Some of my questions, and my thoughts are the only thing 
that is going to save the healthcare system is innovation and 
disruptive innovation, so I am going to gear my questions in 
that regard. I think telehealth is old technology, but at least 
it is here, and at least we have that.
    Mrs. Watts, can you talk about the impact of the pandemic 
and how that has, you know, ushered in more telehealth finally 
gotten some level of adoption that really was resisted for 
quite some time?
    Mrs. Watts. The great thing about telehealth during the 
pandemic was that people that had never tried it before and 
tried it, when we surveyed and said, you know, will you do this 
again, they said yes. Resoundingly, they said yes. I think it 
was a great way to try it out.
    I also think it did a huge service to healthcare providers 
in this country because it kept people out of the doctors' 
offices and going to the hospitals, and it was a way to triage. 
It was really kind of a God send that we even had that as a 
resource for people to access, to determine whether or not 
their symptoms were related to the pandemic, to COVID, or 
something else.
    Mr. Burlison. In addition, it gives access to patients who 
might be in a rural healthcare setting to have very difficult 
times getting an appointment with a psychiatrist, or some of 
these specialists, so that is a huge added benefit as well. Can 
you elaborate, or give us an idea what is holding this back? 
What kind of structural issues are throwing water on this 
innovation?
    Mrs. Watts. I think virtual healthcare, digital healthcare, 
are all very fast-growing segments of the market. Part of that 
is driven by the fact that there is a shortage of providers, 
and people are not able to get an appointment, and so access to 
virtual digital care definitely helps.
    The other thing that is so important related to behavioral 
health is that it has really helped us address a health equity 
issue with access to behavioral health in seeing low income and 
minorities be able to access care that they really didn't have 
access to before.
    Mr. Burlison. Let me ask this, and this may be a question 
for Mr. White. Do we have an issue with, you know, State after 
State they implement licensing laws, a lot of it is turf 
issues. Do we have, as a Nation, as we approach this increased 
demand for professionals, and people to get access to care, 
whether virtually or in person, what is the impact of these 
restrictive licensing laws where they stop potentially mid-
level providers from practicing to the fullest extent of their 
education?
    Mr. White. Yes. Great question, and maybe to answer your 
last question, I think what we saw during COVID was the public 
health emergency was declared, and the government flexed up all 
the rules, and what did we see? We saw innovation come into the 
marketplace, right?
    We deployed an empowered pharmacist to deliver care to 
patients, to fill gaps in access, which is really critically an 
important strategy. 250 million vaccinations through the 
pharmacy channel as a result of some of those policies.
    Also, tests. Being able to deploy prescriptions for people 
who were sick, et cetera. We saw telehealth, which was a 
massive gap filler, once those rules came off. Care at home. We 
do a lot of care in very expensive settings, that we could 
actually deliver in the home now based on new technologies.
    Mr. Burlison. Yes.
    Mr. White. Strategies. With the licensure issues, I think 
what we have seen is we essentially have a really, maybe a 15th 
Century guild system.
    Mr. Burlison. A cartel.
    Mr. White. Blacksmiths and you know, and not to denigrate 
medical professionals, they work hard and get licensed, and do 
their things, but what I think we realized during COVID was you 
can deploy these mid-level, or more junior level medical 
professionals.
    Mr. Burlison. Right. My time is getting close, so I want to 
go through quickly into this. I think, it is my opinion that 
you know, AI is going to radically change healthcare to the 
point where it empowers someone who is a mid-level to be more 
of an expert in diagnosing more accurate, provide better 
healthcare standards, the best medical professionals we have 
today. Could you elaborate?
    Mr. White. We will lower costs. I was in Iowa last year 
where you have got ophthalmology techs using AI to detect 
diabetic retinopathy and screen out the people who need the 
surgery.
    Mr. Burlison. They are just techs.
    Mr. White. Yes. They are just techs, right? We have a 
massive shortage of diabetic techs in this country. You plug 
the machine in, you run them through the tech, and they get the 
people who really are going to need more hands-on care from the 
physician. It works beautifully, it lowers costs, and it gets 
people the access they need.
    Mr. Burlison. Thank you.
    Chairman Good. Thank you, Mr. Burlison. Now I would like to 
recognize Representative Jayapal from Washington for 5 minutes.
    Ms. Jayapal. Thank you, Mr. Chairman. For decades, 
Democrats have proposed and enacted many policies to lower 
health care costs, which included the passage of the Affordable 
Care Act. We protected those with pre-existing conditions. We 
lowered out-of-pocket costs. I have also pushed for policies 
that expand Medicare, ensure homecare for our most vulnerable, 
and eliminate the many fees and copays charged by private 
insurance companies.
    In contrast, Republicans have fought to repeal the savings 
from the ACA, and they continue to propose policies that 
actually increase health care costs for people across the 
country. Ms. Corlette, I am going to ask you just a series of 
questions about Republican policy proposals. You can just 
answer with a short yes or no on whether these policy proposals 
would increase health care costs for Americans.
    The first one is the Republican proposal to take Medicaid 
away from up to 10 million people by instituting onerous and 
unnecessary work requirements as Speaker McCarthy proposed in 
his debt limit bill last week. Would that decrease health care 
costs for Americans?
    Ms. Corlette. No.
    Ms. Jayapal. What about repealing the prescription drug 
provisions in the Inflation Reduction Act, including repealing 
the cap on out-of-pocket prescription expenses for Medicare. 
Would that reduce health care costs for Americans?
    Ms. Corlette. No ma'am.
    Ms. Jayapal. How about cutting funding for the Children's 
Health Insurance Program by billions as proposed by President 
Trump. Would that reduce health care costs for Americans?
    Ms. Corlette. No ma'am.
    Ms. Jayapal. What about encouraging the formation of 
association health plans, also called junk health plans, with 
no additional regulation. Would that reduce costs for average 
Americans.
    Ms. Corlette. No.
    Ms. Jayapal. Let us do the same thing with the policies the 
Democrats have proposed, and you tell me if these would reduce 
health care costs for Americans. Capping the out-of-pocket 
costs for insulin at $35.00 per month for Medicare 
beneficiaries. Would that reduce costs?
    Ms. Corlette. Yes.
    Ms. Jayapal. How about capping out-of-pocket spending on 
prescription drugs at $2,000.00 per year for Medicare 
beneficiaries?
    Ms. Corlette. Yes.
    Ms. Jayapal. How about extending enhanced ACA premium tax 
credits, which saved my constituents an average of $1,200.00 
per year. Would that reduce--has that reduced costs for 
Americans across the country?
    Ms. Corlette. Yes.
    Ms. Jayapal. Finally, I just want to ask you the same thing 
about policies that are proposed by Democrats, that Republicans 
have blocked. All those ones I mentioned were things that we 
already passed. These are things that have been blocked by 
Republicans, and you tell me if these would decrease health 
care costs for people. Extending the cap on insulin costs at 
$35.00 per month to all types of insurance. It was blocked on 
the Senate floor by Republicans. Would that have decreased 
costs for the American people?
    Ms. Corlette. For diabetics, absolutely it would decrease 
costs.
    Ms. Jayapal. How about closing the Medicaid gap to cover 
over two million people in the ten states that have not 
expanded Medicaid under the ACA. Would that reduce costs for 
people in those states?
    Ms. Corlette. Absolutely. Yes.
    Ms. Jayapal. I think I wanted to ask you those questions 
because I want to be clear about the stark contrast in how our 
two sides are approaching health care, which should be a 
universal and bipartisan effort to reduce costs for our 
constituents, but I think that this hearing makes it crystal 
clear that the Republican health care policy proposals are 
actually increasing costs for people.
    Democrats have taken historic steps to decrease health care 
costs for Americans, we have allowed Medicare to negotiate with 
greedy pharmaceutical companies. We have capped the cost of 
insulin and other prescription drugs for people on Medicare, 
and provided support to families struggling with the high cost 
of health insurance premiums.
    We did all of that without a single Republican vote, and we 
have more to do. I have great proposals to address some of the 
issues that Ms. Hayes raised around expanding Medicare to cover 
dental, vision, and hearing, providing all kinds of care that 
people need.
    If our health care system can function, so that we keep 
people healthy, and we do not put barriers in their way to 
seeking health care, and particularly the equity concerns that 
we see in our health care system with people not being able to 
access care, particularly Black, brown, indigenous folks, 
particularly poor people, particularly people in rural areas, 
this country would be much better off.
    I thank you, and I yield back.
    Ms. Corlette. Thank you.
    Chairman Good. Thank you, Representative Jayapal. Now we 
would like to--we are going to go continue with the minority 
party since we do not have anyone here from the majority. We 
will recognize now, Representative McBath from Georgia for 5 
minutes.
    Mrs. McBath. Thank you so much, Chairman Good, Ranking 
Member DeSaulnier, for hosting today's hearing, and to our 
guests for taking the time to be with us today. I am a two-time 
breast cancer survivor, and the daughter of two health care 
professionals, so this issue today is very, very personal to 
me.
    It is personal to me like it is personal for the mothers 
and children who live in the 50 plus counties in Georgia who do 
not have a pediatrician, or even an OBGYN. It is personal to me 
like it is for those in my State who are forced to take unpaid 
time off from work, that they cannot force--that they cannot 
simply afford. They are driving hours away to get themselves or 
their children the care that they need.
    While our Governor, in the State of Georgia, knowingly 
leaves billions of dollars, Federal dollars on the table, and 
refuses to expand Medicaid. There is no justifiable reason why 
in the greatest country in the world that medical bills are the 
No. 1 cause of personal bankruptcy. There is no reason why the 
zip code or the country that you were born into should add or 
subtract another 10 years from your life expectancy, but that 
is the reality in America every single day.
    Republicans love to talk about the high cost of health care 
after the passage of the ACA. They fail to recognize exactly 
how much higher these costs would be for working families 
without these critical protections and these critical programs. 
Thanks to President Biden, congressional Democrats, and the 
Inflation Reduction Act, the number of Americans without health 
insurance is down to the lowest level in the history of this 
country.
    Thanks to the IRA, Medicare is finally able to negotiate 
with drug companies on behalf of American seniors and ensure 
that they aren't paying more for, than they need to, for 
prescriptions like insulin, and yes, that was my law, the 
reducing the cost of insulin to $35.00 out of pocket.
    These protections would have gone even further to support 
working families by capping the price of insulin at $35.00 a 
month for private insurance as well as Medicare, but 
Republicans successfully stripped this provision from my bill, 
the final version of the IRA that was actually signed into law.
    When insulin for human consumption was first discovered and 
synthesized by Dr. Banting, and his team. It was in the 20th 
Century. They sold the patent to the University of Toronto for 
one dollar, just one dollar, claiming that and I quote, 
``insulin does not belong to us, it belongs to the world.''
    I think that it is obvious that Dr. Banting and his team 
would be deeply disturbed by the exorbitant price that insulin 
is regularly sold in the United States today. It is up to 
Congress to right this historic wrong. Despite production costs 
between $2.00 and $4.00 per vial, one in four Americans who 
rely on insulin every single day of their lives, has had to 
risk getting seriously ill, and cut back or skip their dosages 
all together because of the price of insulin.
    Because of the IRA, out-of-pocket costs where people on 
Medicare are now capped at $35.00 a month, and many states have 
taken similar action, as well as the drug manufacturers, three 
major drug manufacturers. Congress has to do more to ensure 
that everyone who needs insulin can afford it, not just those 
on Medicare.
    I am very proud to be a co-leader of the Affordable Insulin 
Act now, which would extend the $35.00 cap to people with 
private health coverage. Ms. Corlette, why is it necessary that 
Congress pass additional legislation such as this, to help cut 
the cost of insulin? Particularly for people with ERISA covered 
plans.
    Ms. Corlette. Thank you for the question. The Inflation 
Reduction Act took tremendous strides to improve the 
affordability for insulin and for many drugs for Medicare 
beneficiaries, but it left, as you said, unfinished business. 
Addressing the costs of insulin and other prescription drugs 
for people in commercial or ESI insurance is critical.
    As I mentioned, there was a really helpful KFF study that 
found that a $35.00 per month cap on prescription drug cost 
sharing would provide financial relief to about 20 percent of 
the 160 million people who are now covered in ESI, so it is 
really a tremendous benefit.
    Mrs. McBath. Thank you so much, and I yield.
    Chairman Good. Thank you very much, and now we will 
recognize Congressman Omar from Minnesota for 5 minutes.
    Ms. Omar. Thank you. It is pretty clear from the 
conversation that Representative McBath was just having, and 
Representative Jayapal, that Democrats have spent a significant 
amount of time thinking about and working on policies that 
reduce health care costs for Americans because our constituents 
are deeply worried about this.
    Ms. Corlette, in your written testimony you referenced 2022 
CBO that recommended three policy interventions on how to 
constrain health care costs. Regulating health care prices, 
reducing consolidation, and untied competitive behavior, and 
improving price transparency. You also pointed to the 
Bipartisan Policy Center report that made recommendations that 
furthered seven interventions, such as capping hospital prices 
in highly concentrated markets.
    There are a lot of proposals that are out there, and 
interventions that are available to us. Can you speak to the 
importance of these policy interventions, and how they compare 
to the proposals that are currently in front of this committee, 
that my Republican colleagues are putting forth.
    If there are differences in the approaches, and if there is 
a cost shift that will take place for Americans.
    Ms. Corlette. Yes. Thank you for the question. The No. 1 
reason why we are in an affordability crisis in private health 
insurance is the prices that commercial health plans are paying 
for health care goods and services. Particularly, hospital 
services and prescription drugs.
    One of the reasons for that is consolidation. A lack of 
competition, particularly in the hospital sector. The 
Congressional Budget Office has looked at this issue, and they 
have identified three major policy areas that could help reduce 
costs for commercially insured people, and they looked at 
directly or indirectly regulating prices, hospital prices, and 
that will have the most impact on affordability.
    Reducing anti-competitive behavior like clauses and 
provider payer contracts that restrict competition, that could 
also have an impact, as well as price transparency. Those will 
get at the underlying drivers of health care cost growth in 
this country.
    Policies that simply move the deck chairs around on the 
Titanic, and lower prices for groups that have healthier 
workers, or younger workers, will simply just create new 
winners and losers. With the losers being employers that have 
workforces that are not quite as healthy, or older than their 
peers.
    Ms. Omar. Through this hearing, our Republican colleagues 
have been calling for the expansion of so-called associated 
health plans, claiming this policy change that can make--that 
will make health care more affordable. In your written 
testimony, you pointed out that some AHP sponsors claimed to 
achieve lower premiums because they somehow exercise market 
clout.
    Can you tell us what evidence is there that they are 
actually negotiating lowering prices with health care 
providers, and if that is not how they are saving money, how is 
it exactly that they are able to lower prices?
    Ms. Corlette. Sure. First of all, there is nothing 
preventing small employers, large employers, from banding 
together to form purchasing coalitions. There are examples of 
that in states that have been very effective. The way AHPs 
lower premiums are by attracting healthier employer groups, and 
using what is called claims experience rating. They look at the 
claims of each individual employer group to set the premium 
rate.
    If you have got a healthier group, you get a lower premium. 
That really does not do anything to address the underlying 
driver of why health care is so expensive, which my colleague, 
Ms. Strouse articulated so well, which is prescription drug 
prices and hospital costs. Thank you.
    Ms. Omar. Thank you so much, and thank you all for being 
here and for your testimony. I do hope that we do get the 
opportunity to actually look at some of these bipartisan 
interventions, and some of the policies that are proposed by 
CPO to actually address the rise of health care costs, and so 
many people that are in desperate need of relief in our 
country, so thank you. I yield back.
    Chairman Good. Thank you, Representative Omar. Now I would 
like to recognize my friend and fellow Virginian, Ranking 
Member Scott for 5 minutes.
    Mr. Scott. Thank you. Thank you, Mr. Chairman. I appreciate 
you calling this hearing. I would like to ask Ms. Corlette a 
couple of questions. First one, we have heard a lot about 
businesses. One thing we did in the Inflation Adjustment Act 
was to--previously, was to eliminate the so-called cliff on 
premiums under the Affordable Care Act.
    Can you explain how that would help a small business?
    Ms. Corlette. By cliff, do you mean for people over 400 
percent of--sure. Absolutely. The Inflation Reduction Act says 
for people who are essentially middle class, about four times 
the Federal poverty level. They will not have to pay more than 
8.5 percent of their income toward premiums in the marketplace.
    For small employers or individuals or self-employed 
individuals who have income at that level, their premium 
contributions are capped at 8.5 percent, which is financial 
relief for a significant number of----
    Mr. Scott. Yes, if they were just over the 400 percent of 
poverty, which is a little over for a family of four, a little 
over $100,000.00, what could a policy cost without any 
subsidies?
    Ms. Corlette. Without any subsidies? In the individual 
market for a family of four without any subsidies, I think you 
could be anywhere close to, $20,000.00 a year.
    Mr. Scott. $20,000.00 and just over the limit, and the 
limit is 8 and a half percent of poverty, it goes from 
$20,000.00 to eight and a half. That would be particularly 
helpful to individuals in business for themselves, particularly 
helpful to families and small business.
    Back to the AHPs. You have talked about the fact that the 
premium is set at something actuarily sound for that group, 
which means if the group comes in and they evaluate it, and 
they get a price which is higher than average, what happens? 
Nobody will buy the policy if it is higher than average.
    If it is lower than average, then they might benefit. Is 
that what you mean by cherry pick?
    Ms. Corlette. Correct. If you have an employee group that 
is healthier than the average group in the fully insured 
market, you are likely to find a lower rate within the AHP.
    Mr. Scott. When they come out of the general pool what 
happens to the average cost in the general pool?
    Ms. Corlette. Sure. Actually, there is an actuarily 
analysis that was done of the Trump administration rules, and 
they found that on average the folks that would come into the 
AHP market would be about 54 percent healthier, meaning less 
morbidity in the AHP market, than in the fully regulated and 
ACA regulated market, and that would increase prices by about 
4.4 percent for plans in the ACA regulated market.
    Mr. Scott. If you do not get in one of these plans, and you 
allow people, healthy people to pull out, everybody else's 
premium goes up?
    Ms. Corlette. Right. What happens is what we call an 
adverse selection dynamic, where healthier groups go into the 
AHPs and groups that have older or sicker workers are left in 
the ACA regulated market, and over time their premiums will 
climb every year.
    Mr. Scott. What happens to an AHP if suddenly somebody gets 
sick and the rates go up, and they charge, start charging more 
than average. Are the people in the AHP required to stay there 
and pay those higher prices, or can they jump back into the 
pool and pay the average prices?
    Ms. Corlette. Sure. In the AHP, they can look at the claims 
experience of each individual small employer group. If you have 
a group that is generating more costs, their prices will go up 
because it is underwritten, and they may choose to go back into 
the ACA regulated market, which of course, if they have high 
claims costs will increase the morbidity in that market.
    Mr. Scott. While everybody else left behind pays higher 
prices when people pull out, they are essentially providing 
back-up insurance, so when things go wrong, and prices go up, 
they can jump back into the pool when the prices go up. Is that 
right?
    Ms. Corlette. That is a very fair characterization.
    Mr. Scott. There is a thing called cost shifting, and the 
fact that because of Obamacare and the Medicaid expansion we 
are at the lowest uninsured rate in history, what does that do 
to everybody else's insurance costs?
    Ms. Corlette. Well, we know before the Affordable Care Act 
that providers had a lot more of what we call uncompensated 
care costs, and they were essentially shifting those costs onto 
the insured population at a cost of about $700.00 per family 
per year.
    The Affordable Care Act, by dramatically decreasing the 
uninsured rate has reduced providers uncompensated care costs, 
and the amount that they shift onto the insured population.
    Mr. Scott. Thank you. Mr. Chairman, I ask unanimous consent 
that I enter two documents into the record. One is a letter 
signed by 25 patient and consumer organizations, expressing 
concerns about associated health plans and created and excepted 
benefit exemption for telehealth plans, telehealth only plans.
    The second is a statement from Families U.S.A. that, among 
other things, concludes that and I quote, ``Proposals to expand 
the use of health plans that are exempt from State and local 
regulations, do not address the fundamental causes of our 
health care affordability crisis.''
    Chairman Good. Without objection.
    [The information of Mr. Scott follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
    
    
    Mr. Scott. Thank you. I yield back.
    Chairman Good. Thank you, Congressman Scott. Without any 
further witnesses, or excuse me, members other than myself, I 
am going to go ahead and ask a few additional questions. Again, 
thank you to all of our witnesses for being here. One comment I 
will add as a Member of Congress, a lot of people do not know 
that Members of Congress are forced onto Obamacare.
    I guess we, I use that term loosely, we deserve to suffer 
under that which we have placed the American people. I have the 
highest healthcare premiums I have ever had, far and away, it's 
$1,300.00 a month for just my wife and I. We are a healthy 50-
some year old.
    We are experiencing first-hand for the first time the peril 
of Obamacare, the lack of choice competition, transparency, 
accountability that plagues our healthcare system, that 
contributes to these higher rates, not to mention the fact the 
country is going bankrupt, and we cannot afford what we are 
doing from a government provision standpoint.
    Mr. White, I want to ask a quick question of you. One of 
our members asked Ms. Corlette if the price cap on insulin was 
causing premiums to go down, and she gave a very specific 
answer and said for diabetics. Is the price cap on insulin 
causing the premium to go to down for everyone?
    Mr. White. No. CVUS made it that premiums would increase, 
and fewer options would be available.
    Chairman Good. Yes, I thought so. Thank you very much. Ms. 
Watts, why is competition a good thing in the healthcare 
marketplace?
    Mrs. Watts. Competition is good everywhere, but with the 
lack of competition we see things happening like we have 
described already today with the unfair billing practices where 
you know, providers can charge what they want to for services. 
The savings that consumers could benefit from site neutral 
payment reform from focusing on more transparency with billing 
are enormous, depending on whose estimates you look at it, 
hundreds of millions of dollars.
    Chairman Good. We are talking about the debt ceiling here. 
Negotiation, someone mentioned earlier, government is bankrupt, 
32 trillion national debt, running deficits every year, record 
levels. Who ultimately bears the cost if the government is 
paying out more in healthcare payments?
    Mrs. Watts. We do.
    Chairman Good. Yes. Absolutely. The consumer does. How 
about at the astronomical billing by hospitals. How does that 
affect care for patients?
    Mrs. Watts. Well, there are two things. First of all, when 
the cost of care goes up, some people will forego care, and 
that actually is more detrimental and more costly in the long 
run. There are many studies that have proven that. Second, we 
are all very familiar now the actuarial value of the plan. It 
is basically what the plan pays, and the consumer pays the 
remainder.
    The higher the cost is, that actuarial value is the same, 
it is just that what we are all paying goes up.
    Chairman Good. What is this legal price gouging impact on 
doctors do you think? The hospital cost, the dishonest billing 
that's going on?
    Mrs. Watts. I am not exactly sure, but I thought it was 
interesting in the prior questioning about the uncompensated 
care. I do not recall seeing trend go down as a result of the 
drop in uncompensated care, so I am not really sure where all 
the money goes.
    Chairman Good. Ms. Strouse, thank you, Mrs. Watts. Ms. 
Strouse, I thought it was interesting when it was said earlier 
that consumers might not understand they were getting just a 
telehealth stand-alone policy. I do not know how anyone would 
not understand that and would be fooled by that.
    My colleagues on the other side of the aisle seem to think 
that if a plan does not cover exactly what the Federal 
Government says it should cover, then it is a junk plan. Given 
your professional expertise, what sort of value do employees 
get when employers have more flexibility in the coverage they 
can offer? What is the value to employees?
    Ms. Strouse. Yes. Well, employers are always coming to the 
table to try and find solutions for their employees. Even if a 
part-time employee does not have access to healthcare, rolling 
out a telehealth plan is something. Otherwise, they would have 
nothing. When we look at these, the telehealth specifically, 
most of the plans that people are accessing right now are 
actually in part of their health insurance policies, and so 
they do have great coverage through those. They are not for 
everyone.
    There is going to be situations where you need to actually 
go in and see your provider, but those telehealth services 
helped significantly in Iowa around the mental health space, 
and so again, agents are extremely important. We are not only 
working with employers, we are actually working with the 
employees on a daily basis to make sure that when policies are 
rolled out like this, or plans are rolled out, that it is 
communicated, and they fully understand what they have.
    Chairman Good. Thank you very much. You know, I think my 
friends from the other side approach our responsibility to 
protect Americans from themselves, it is our responsibility 
they think to provide for Americans, that is the government's 
responsibility. They do believe.
    They come from a mentality that employers do not care about 
their employees, when actually most employers really do care 
about their employees, want them to be happy and satisfied, 
safe and well with the healthcare they receive as Mrs. Watts 
spoke to specifically.
    With that, we will conclude our questioning of our 
witnesses. I am sorry. I did not see Ms. Manning had slipped 
in, so now we will go and recognize--my time has concluded. We 
will recognize Representing Manning from North Carolina for 5 
minutes.
    Ms. Manning. Thank you so much, Mr. Chairman. Mr. Chairman, 
I would like to point out that the Inflation Reduction Act put 
a cap on the price of insulin for seniors, and as a direct 
result of that Act, which was supported by House Democrats, and 
signed into law by President Biden, two major manufacturers of 
insulin, Eli Lilly and Novo Nordisk, have already announced 
that they are reducing the cost of insulin to $35.00 for 
everyone.
    The law we passed has already had an enormous benefit for 
everyone who needs insulin. I would like to stick with that. 
The Inflation Reduction Act, and to ask Ms. Corlette, can you 
give us your assessment of the IRA's emphasis, not only on 
capping out-of-pocket costs, but also on lowering the 
underlying prices of drugs like insulin?
    Ms. Corlette. Sure. Full disclosure, I am not a Medicare 
expert, but I think one of the key pieces of the Inflation 
Reduction Act was to empower Medicare as a purchaser of 
prescription drugs to negotiate for a selected set of drugs on 
behalf of their beneficiaries, to try to get a lower price.
    That is something that Medicare had been barred from doing. 
Obviously, the law is just being implemented, and so it will be 
a while before we see the full fruits of that negotiation 
power, but I do think there's unfinished business because I 
think many employer plans could also benefit from leveraging 
that negotiating power against drug manufacturers.
    Ms. Manning. In other words, extending these reforms to 
private health plans, including employer supported plans, or 
employer sponsored plans, could help make drugs more affordable 
for consumers and businesses?
    Ms. Corlette. Absolutely.
    Ms. Manning. In your testimony, you raise the problem of 
anti-competitive behavior in the prescription drug industry, 
including financial practices that disfavor low-cost generic 
and bio-similar drugs that driver higher prices. This is 
concerning to me on a personal basis.
    I myself had to fight for the coverage of my daughter's 
medication, which my health insurance company gave me the 
runaround on because it was going to cost $10,000.00 a month, 
and fortunately I was able to win that fight, but I know so 
many other people do not have the knowledge or the wherewithal 
to keep fighting when they should be getting medications 
covered by their health insurance companies.
    At the level of pharmaceutical manufacturers, how can we 
ensure that lower cost biosimilars are able to enter the market 
without interference from brand name manufacturers? Can you 
talk to us a little bit about what happens, what some of the 
brand manufacturers do to prevent those generics from coming to 
the market?
    Ms. Corlette. Congresswoman Manning, this is also a bit 
outside my expertise, but I can say that there is evidence that 
pharmacy benefit managers often hold on to a significant 
portion of rebates from drug manufacturers that should be 
passed on to employers' health plans, and they often can 
disfavor generic drugs if they do not come with rebates 
relative to higher cost prescription drugs.
    Ms. Manning. Thank you. Ms. Strouse, I saw you nodding your 
head on that one, so I wonder if you could comment on that, and 
also talk to me about the problem of transparency in the 
pharmacy benefit manager industry.
    Ms. Strouse. Yes. Actually, specifically in Iowa, we have 
been trying to address this on the State level, and last 
session we were successful in getting some transparency 
legislation passed, so we are really excited to start to dig 
into the information that we are receiving from the pharmacy 
benefit managers.
    I can tell you we cannot solve problems if we do not go to 
the root cause of the problem, which truly is the drug 
manufacturers. When we have medications that are truly 
lifesaving, like for instance, for your child, if it is 
$10,000.00, why is there not competition out there?
    Why are they holding onto those prices? When we throw 
around words like cap, it makes me anxious because a cap to me 
means you are telling the insurance company they can only 
charge $35.00. Well, the manufacturer is still charging that 
full price through. Those are always going to feed into the 
premiums. That is going to be one way or the other, everybody 
is going to end up paying for that.
    If we are not able to address it directly with the drug 
manufacturers, then I am very excited to hear the progress on 
the insulin side of things, because I do work in the Medicare 
market, and we have a lot of people that are on insulin. That 
is exciting, if that can drive change where the manufacturers 
are actually reducing the costs across the board for everyone, 
then that is going to be a solution.
    If it is just capping through insurance, insurance is a 
middle man. The prices are still what they are behind the 
scenes with----
    Ms. Manning. I have to agree with you. It is very exciting 
that the law we passed to cap the price of insulin for seniors 
has resulted in the cost of insulin being reduced for 
everybody, and we can only hope that will continue. We are 
facing a mental health crisis, and we know that telehealth has 
become a key avenue for mental health services.
    In my 10 seconds I have left, Ms. Corlette, how can 
Congress ensure that part-time workers have access to some form 
of telehealth, particularly for behavioral health?
    Ms. Corlette. Well, there is nothing preventing employers 
from offering part-time workers access to health benefit with 
telemedicine. Also, if you are not offered an employer-based 
plan, you can choose to buy a marketplace plan, and many of 
these marketplace plans are also covering telehealth services.
    Ms. Manning. Thank you. My time has expired, and I yield 
back.
    Chairman Good. Thank you, Congresswoman Manning, and 
without objection before we close, I enter in the record 
letters supporting efforts to enhance healthcare affordability 
from the following organizations: Americans for Prosperity, 
bipartisan organization supporting site neutral payments, the 
American Hospital Association, the ERISA Industry Committee, 
the National Association of Benefits and Insurance 
Professionals, NFIB, and the Partnership for Employer Sponsored 
Coverage.
    [The letters of Mr. Good follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] 
    
    
    
    Chairman Good. Again, I would like to thank all four of our 
witnesses for taking the time to testify before the committee 
on this very important issue today. Without objection, there 
being no further business, the committee stands adjourned.
    [Whereupon the Subcommittee on Health, Employment, Labor, 
and Pensions adjourned at 12:23 p.m.]

                                 [all]