[Senate Hearing 118-256]
[From the U.S. Government Publishing Office]
S. Hrg. 118-256
HOW PRIMARY CARE IMPROVES
HEALTH CARE EFFICIENCY
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HEARING
BEFORE THE
COMMITTEE ON THE BUDGET
UNITED STATES SENATE
ONE HUNDRED EIGHTEENTH CONGRESS
SECOND SESSION
__________
March 6, 2024
__________
Printed for the use of the Committee on the Budget
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
55-277 WASHINGTON : 2024
COMMITTEE ON THE BUDGET
SHELDON WHITEHOUSE, Rhode Island, Chairman
PATTY MURRAY, Washington CHARLES E. GRASSLEY, Iowa
RON WYDEN, Oregon MIKE CRAPO, Idaho
DEBBIE STABENOW, Michigan LINDSEY O. GRAHAM, South Carolina
BERNARD SANDERS, Vermont RON JOHNSON, Wisconsin
MARK R. WARNER, Virginia MITT ROMNEY, Utah
JEFF MERKLEY, Oregon ROGER MARSHALL, Kansas
TIM KAINE, Virginia MIKE BRAUN, Indiana
CHRIS VAN HOLLEN, Maryland JOHN KENNEDY, Louisiana
BEN RAY LUJAN, New Mexico RICK SCOTT, Florida
ALEX PADILLA, California MIKE LEE, Utah
Dan Dudis, Majority Staff Director
Kolan Davis, Republican Staff Director and Chief Counsel
Mallory B. Nersesian, Chief Clerk
Alexander C. Scioscia, Hearing Clerk
C O N T E N T S
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WEDNESDAY, MARCH 6, 2024
OPENING STATEMENTS BY COMMITTEE MEMBERS
Page
Senator Sheldon Whitehouse, Chairman............................. 1
Prepared Statement........................................... 31
Senator Charles E. Grassley, Ranking Member...................... 3
Prepared Statement........................................... 34
STATEMENTS BY COMMITTEE MEMBERS
Senator Ron Wyden................................................ 5
Senator Ron Johnson.............................................. 18
Senator Chris Van Hollen......................................... 21
Senator Alex Padilla............................................. 24
Senator Tim Kaine................................................ 26
Senator Mike Braun............................................... 27
WITNESSES
Mr. Christopher Koller, President, Milbank Memorial Fund......... 7
Prepared Statement........................................... 37
Dr. Amol Navathe, Associate Professor, Perelman School of
Medicine and The Wharton School, University of Pennsylvania.... 9
Prepared Statement........................................... 46
Dr. Bob Rauner, President, Partnership for Healthy Nebraska, and
Representative, American Academy of Family Physicians.......... 10
Prepared Statement........................................... 60
Ms. Lisa M. Grabert, Visiting Research Professor, Marquette
University College of Nursing.................................. 12
Prepared Statement........................................... 68
Dr. Christina Taylor, Chief Medical Officer, Value Based Care,
Clover Health, and President-Elect, Iowa Medical Society....... 13
Prepared Statement........................................... 78
APPENDIX
Responses to post-hearing questions for the Record
Mr. Koller................................................... 82
Dr. Navathe.................................................. 86
Dr. Rauner................................................... 94
Ms. Grabert.................................................. 100
Dr. Taylor................................................... 103
Statement submitted for the Record by AARP....................... 108
Statement submitted for the Record by American Academy of PAs.... 112
Statement submitted for the Record by American Association of
Child and Adolescent Psychiatry................................ 113
Statement submitted for the Record by American College of
Osteopathic Family Physicians.................................. 115
Statement submitted for the Record by American College of
Physicians..................................................... 116
Statement submitted for the Record by Arnold Ventures............ 118
Statement submitted for the Record by the Commonwealth Fund...... 121
Statement submitted for the Record by Families USA............... 125
Statement submitted for the Record by the National Association of
ACOs........................................................... 129
Statement submitted for the Record by National Partnership for
Women and Families............................................. 133
Statement submitted for the Record by Primary Care Collaborative
and Better Health Now.......................................... 136
Statement submitted for the Record by Rhode Island Health Center
Association.................................................... 139
Statement submitted for the Record by Society of General Internal
Medicine....................................................... 141
Statement submitted for the Record by United States of Care...... 145
HOW PRIMARY CARE IMPROVES
HEALTH CARE EFFICIENCY
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WEDNESDAY, MARCH 6, 2024
Committee on the Budget,
U.S. Senate,
Washington, DC.
The hearing was convened, pursuant to notice, at 10:07
a.m., in the Dirksen Senate Office Building, Hon. Sheldon
Whitehouse, Chairman of the Committee, presiding.
Present: Senators Whitehouse, Murray, Wyden, Kaine, Van
Hollen, Lujan, Padilla, Grassley, Johnson, Marshall, Braun, and
R. Scott.
Also present: Democratic staff: Dan Dudis, Majority Staff
Director; Anirudh Srirangam, Healthcare Policy Advisor.
Republican staff: Chris Conlin, Deputy Staff Director;
Krisann Pearce, General Counsel; Nic Pottebaum, Professional
Staff Member; Ryan Flynn, Staff Assistant.
Witnesses:
Mr. Christopher Koller, President, Milbank Memorial Fund
Dr. Amol Navathe, Associate Professor, Perelman School of
Medicine, and The Wharton School, University of Pennsylvania
Dr. Bob Rauner, President, Partnership for Healthy
Nebraska, and Representative, American Academy of Family
Physicians
Ms. Lisa M. Grabert, Visiting Research Professor, Marquette
University College of Nursing
Dr. Christina Taylor, Chief Medical Officer, Value Based
Care, Clover Health, and President-Elect, Iowa Medical Society
OPENING STATEMENT OF CHAIRMAN WHITEHOUSE \1\
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\1\ Prepared statement of Chairman Whitehouse appears in the
appendix on page 31.
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Chairman Whitehouse. All right, let me call our Committee
back to order for purposes of the hearing, which I hope will
open some healthy bipartisan conversations on ways that we can
save money in our healthcare system by improving the quality of
care for patients. Members of the Committee may recognize this
chart, certainly members of the Finance Committee may recognize
this chart, which I've used for years to show the enormous
opportunity that we have in healthcare in America.
It graphs healthcare spending as a percentage of Gross
Domestic Product (GDP) against life expectancy. And as you can
see, we are outliers in exactly the wrong direction. That's the
bad news. The good news is there's lots of room for improvement
and the numbers are big. U.S. health spending makes up 17
percent of GDP. As you can see, it's a far higher percentage
than in peer nations. Yet, U.S. life expectancy is below peer
nations and even falling. Indeed, it's now fallen to its lowest
in two decades.
By contrast, Germany's health spending represents 12.5
percent of that nation's GDP with longer life expectancy. If
America's healthcare spending went from 17 percent to 12.5
percent of GDP, it would save our budget nearly a trillion
dollars a year, $10 trillion dollars in our customary 10-year
budget window. So, we are dealing with potentially very, very
big savings.
Why is American healthcare spending so inefficient? One
answer is how badly we fund primary care. In our Budget
Committee hearing last October, we heard that despite
overwhelming evidence that primary care is associated with
longer life expectancy and lower downstream health costs, the
U.S. continues to spend less on primary care as a share of
total healthcare spending than any other peer Organisation for
Economic Co-operation and Development (OECD) country. In fact,
average primary care spending across our peer nations is nearly
double ours.
U.S. percentage spending on primary care actually declined
from a sad 6.5 percent in 2002 to a truly woeful 4.7 percent in
2019. Today, three in ten Americans report not having a usual
source of primary care. In some areas, often rural areas, the
situation is much worse.
At our October hearing, we also heard how accountable care
organizations (ACOs), and other payment models have improved
the quality of care while lowering the cost of care. We've seen
that in Rhode Island through two primary care ACOs, Coastal
Medical and Integra. So, today's hearing is about how to do
more of that. How to deliver better care at a lower cost with
better outcomes for patients.
This is often pretty straightforward stuff. Primary care
doctors and nurses know their patients. They know what they
need to stay healthy, whether it's home visits or telehealth
options or better coordination of their medications or better
diets or moving that slippery rug at the bottom of the stairs.
Letting primary care doctors and nurses out of the handcuffs of
fee for service payment frees up these simple innovations and
patients love it.
We'll hear from experts today how to get there, not
complicated. First, make high quality primary care more
available. Second, fix how we pay for primary care. We are
releasing a discussion draft of a bill tasking Centers for
Medicare and Medicaid Services (CMS) to accelerate value-based
primary care by creating hybrid payment models for Medicare
primary care providers. Hybrid payment start to move away from
the failed fee-for-service treadmill by at least partially
paying primary care providers based on their patient mix.
These hybrid payment models reward providers who provide
the best care to their patients. Care that reduces the
patient's emergency visits, hospitalizations, excess specialist
services, and other big-cost drivers. And these hybrid payment
models reward patients with better health.
My discussion draft proposes a Technical Advisory Committee
to improve how CMS sets Medicare's physician fee schedule. The
existing fee schedule has under resourced both primary care
services and primary care provider pay, leading to few primary
care physicians. One report projects that in a decade the U.S.
will face a shortage of between 17 and 45,000 primary care
doctors. If good primary care reduces overall costs, as the
data suggests, that will be a very expensive primary care
physician shortage. One to which the existing fee schedule is
leading us.
On the reform side, even good alternative payment models
stand on the existing fee schedule, hampering the new model's
ability to hit that triple aim of better patient experience,
better outcomes, and lower costs. Fee schedule reforms could
head off that very expensive primary care shortage and at the
same time help current primary care providers lower health
costs by improving Medicare beneficiaries' health outcomes.
So, I encourage my colleagues to work with me as we develop
these policies further. Today we'll hear from Chris Koller, the
nation's first state health insurance commissioner who put
primary care at the center of health spending in Rhode Island
and saw lower costs and better outcomes result. He'll explain
how reliance on a broken fee-for-service healthcare system
limits our potential to scale primary care reforms.
We'll hear from Dr. Amol Navathe about how hybrid payment
models can strengthen primary care by helping providers
innovate, improve care, and lower costs. And we'll hear from
Dr. Bob Rauner, a frontline primary care physician, about how
payment models affect the care he provides his patients.
We've learned a lot since passing the Affordable Care Act
about how delivery system reforms can unlock improvements in
our healthcare system that drive meaningful cost savings from
better care. Now, we can use that learning to make improved
care for patients and lower costs for the budget an everyday
thing.
The reforms contained in my discussion draft would help
doctors deliver high quality primary care to many more
Americans and improve their health outcomes and lower total
healthcare spending because more and better primary care
reduces the need for expensive specialty and hospital care.
These are savings we achieve with no, none, zero benefit cuts.
Let's be very clear about that. These are savings we achieve
because patients are healthier. Patients are healthier because
they get better primary care and doctors provide better primary
care because we reward them for that.
Simple tools, but we need to put them to work, and I hope
this hearing helps begin that process. And with that, I turn to
my distinguished Ranking Member, Senator Grassley.
Senator Grassley. Thank you.
Chairman Whitehouse. And I will, at the conclusion of
Senator Grassley's remarks, I'd like to recognize the Chairman
of the Finance Committee who has important jurisdiction in this
space for a few remarks as well, Senator Wyden, then we'll
proceed to the witnesses.
OPENING STATEMENT OF SENATOR GRASSLEY \2\
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\2\ Prepared statement of Senator Grassley appears in the appendix
on page 34.
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Senator Grassley. Well, thank you for holding today's
hearing on strengthening primary care. Americans spend more
than $4.3 trillion annually on health. Our spending has more
than tripled as a percentage of Gross Domestic Product since
1960. Growing healthcare costs don't just strain the American
pocketbooks, these costs also are a major driver of widening
budget deficits in the federal government's unsustainable
fiscal outlook. And it's clear that we're not getting our
money's worth for all of this spending.
Major healthcare programs spending eats up 32 percent of
the federal revenue today and will be 45 percent mid-century.
Our healthcare system has plenty of waste and inefficiencies
that need fixing, increasing transparency and competition,
fighting fraud, and getting rid of red tape are some key areas
where we ought to find a bipartisan start.
We can also do a better job reducing clinical waste by
focusing more on prevention and early intervention, reducing
inappropriate care, and also improving care coordination.
Having access to primary care is key to being able to do all of
these things I mentioned. When patients have access to timely
primary care, they have better health outcomes and live longer.
We're blessed with millions of dedicated and qualified
healthcare providers. These individuals care deeply about the
quality of care that they provide.
I'm proud that Iowa is home to several great institutions
that train primary care doctors, physician assistants, nurses,
therapists, and too many more to mention. Rural primary care
depends on a suite of providers, meaning doctors, physician
assistants, nurse practitioners, along with telehealth and
other innovations to deliver timely care. To make primary care
more accessible and effective, we need to remove federal
government barriers, lean on consumer choice and price
transparency, and be outcomes based.
To often Medicare regulations and payment systems are
overly burdensome for physicians. Government driven approaches
haven't moved our healthcare system to be more outcome based.
The future of Medicare payments to providers and improving
access to primary care lies outside of the fee-for-service, so
patients and taxpayers can get better value. The key question
is how do we actually do that, who's in control, and what can
lower costs and at the same time improve health outcomes.
Last October, this Committee held a hearing of reducing
excess costs in healthcare. I'm glad that we took an accurate
account of what's working and not working in reducing our
nation's healthcare costs at that hearing. Now, the
Congressional Budget Office (CBO) has found the Center for
Medicare and Medicaid Innovation, a program created to lower
costs has not lowered Medicare costs. That's not my judgment.
That's CBO.
CBO told us what is lowering healthcare spending in
Medicare is the Part D program. In the past decade, existing
brand name drugs lost their patent protection. As a result of
new competition from generic drugs patients are shifting to
less expensive generic formulas. This is in line with what we
already know from CBO. In the first decade of Part D, it ended
up costing taxpayers 36 percent less than projected by CBO and
that doesn't happen very often.
As then Chairman of the Senate Finance Committee, I was
proud to author Medicare Part D. Prescription drug costs are
still too high. We need to reform the role of the very opaque
middlemen and you know them as PBMs or Pharmacy Benefit
Managers, and we need to enact more competition into the drug
market. We know that market-based solutions are effective in
lowering costs and improving care as we have seen, as I just
stated, in Medicare Part D.
We should build on these policies, while seniors should get
a choice between fee-for-service Medicare and Medicare
Advantage. We know that Medicare Advantage (MA) is a growing
choice of many seniors. Medicare Advantage can be effective at
promoting value in the healthcare by directing resources in
primary care and higher quality care. As Medicare Advantage
adds more patients and spreads billions of dollars of
taxpayers' money, aggressive oversight is needed to root out
fraud, waste, and abuse that's been a focus of mine for many
years.
Finally, we can't talk about waste and inefficiency in
healthcare without discussing our country's fiscal situation.
According to CBO, the federal budget deficit in the fiscal year
that most recently ended clocked in at two trillion dollars and
future deficits are projected to be even larger. Growing
healthcare spending is a major reason. Healthcare spending can
be made more efficient without compromising the quality of care
and reducing access, especially in rural areas where access is
a major problem.
I look forward to this hearing, from our witnesses, and
thank them for appearing because this issue of more primary
care is very necessary to be solved if we're going to reduce
costs.
Chairman Whitehouse. We recognize Chairman Wyden for his
remarks and then I'll introduce the witnesses.
STATEMENT OF SENATOR WYDEN
Senator Wyden. Thank you very much, Mr. Chairman. And
colleagues, thank you for allowing me this imposition. I'm
going to be very brief. Particularly, the Finance members
recall that before he retired, we all worked with Chairman
Hatch to begin to move Medicare away from being just an acute
care program to being one that will deal with chronic illness.
The reason that Senator Whitehouse's work is so important is
that when we did that, and it was a crucial transformation.
When I was coming up, I remember Medicaid was for acute
care. You broke your ankle or something like that, you went to
the hospital. Now, Medicare, to a great extent, there's cancer
and diabetes and heart disease and strokes, and all these
chronic illnesses, and primary care, what Chairman Whitehouse
is going after here has a key role, colleagues, to play in
managing chronic illness. In effect, this is the next step, and
I would just say, whether it is grab bars in showers, whether
it's transportation assistance, whether it's air conditioning,
you can go on and on, but all of it relates to this primary
care issue that Senator Whitehouse, who, in addition to his
role here as Chairman of the Budget Committee, wears another
very valuable hat on the Finance Committee.
I think we can all work together and this is the future and
Dr. Rauner, I'm going to try and get back. We're working on the
tax bill this morning and sort of around the clock, but your
point of saying, in particular, that a lot of these primary
care services should apply to traditional Medicare, not just
MA, is very much in sync with, I think, the forward-thinking
work that's going on in healthcare. Chairman Whitehouse is
going to lead this effort and we're going to work really
closely with him.
Colleagues, apologies for the bad manners.
Chairman Whitehouse. No, no, when the Chairman of Finance
wants to talk about healthcare reforms, we're all ears. First,
we'll hear from Chris Koller. Mr. Koller is the president of
Milbank Memorial Fund, 115-year operating foundation that works
to improve population health and health equity.
As I mentioned, he was the country's first health insurance
commissioner from Rhode Island from 2005 to 2013. He's a member
of the National Academy of Sciences, Engineering, and Medicine
and on the faculty of Brown University School of Public Health.
We'll then hear from Dr. Amol Navathe. Dr. Navathe is an
Associate Professor of Medicine and Health Policy at the
University of Pennsylvania. He's a practicing internal medicine
physician and a health economics researcher. His research
focuses on improving the quality and cost efficiency of
healthcare through better payment approaches. He currently
serves as Vice Chair of the Medicare Payment Advisory
Commission. He's previously served at the Council of Economic
Advisors and as a leader of the Comparative Effectiveness
Research Portfolio for the Department of Health and Human
Services.
We'll then hear from Dr. Bob Rauner. Dr. Rauner is a family
physician who spent the first 15 years of career caring for
rural and underserved patients in Nebraska and then spent the
past 12 years starting two primary care physician-led
accountable care organizations, the Southeast Rural Physicians
Alliance ACO in 2012, and then One Health Nebraska ACO in 2016.
He serves as president of the Partnership for Healthy
Nebraska, a group that works with organizations and communities
in Nebraska to address health-related issues impacting those
they serve. And he's appearing today as a representative of the
American Academy of Family Physicians.
We're also joined by Ms. Lisa Grabert. Ms. Grabert is a
Visiting Research Professor at Marquette University College of
Nursing. Previously, she's worked at the House of
Representatives Committee on Ways and Means, the American
Hospital Association, and the Centers for Medicare and Medicaid
Services.
And our final witness today will be Dr. Christina Taylor.
Dr. Taylor is the Chief Medical Officer for Value Based Care
for Clover Health. She is also President-Elect of the Iowa
Medical Society. Preivously, Dr. Taylor served as Chief Medical
Officer at the McFarland Clinic in Ames, Iowa, where she
oversaw the population and value-based healthcare efforts. Dr.
Taylor earned her medical degree from the University of Iowa,
Carver College of Medicine and completed her internal medicine
residency in Des Moines, Iowa. We welcome all of you. Mr.
Koller, please proceed. I've got to remember I'm an official
here and I can't call you by your first name.
STATEMENT OF CHRISTOPHER KOLLER, PRESIDENT, NILBANK MEMORIAL
FUND \3\
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\3\ Prepared statement of Mr. Koller appears in the appendix on
page 37.
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Mr. Koller. Thank you. Chairman Whitehouse, Ranking Member
Grassley, and distinguished members of the Committee, thank you
for the opportunity to testify today.
As you hammer out details this week of a spending bill that
contained sorely needed funding for community health centers,
the National Health Service Corp and teaching health centers, I
wanted to focus on the essential nature of primary care and
Medicare's role in shaping the country's healthcare system.
As Senator Whitehouse noted, in 2005, I assumed the newly
created role of Health Insurance Commissioner for the State of
Rhode Island. My job was to direct commercial insurers to
improve the accessibility, quality, and affordability of the
healthcare system. I convened an advisory council of consumers
and providers to look at the drivers of healthcare
unaffordability in Rhode Island. They found a gravely out of
balance healthcare delivery system that depended heavily on
specialty care providers and underfunded primary care providers
who, when adequately supported, deliver cost effective,
preventive urgent, routine, and chronic care. These issues also
cripple the Medicare Program and the U.S. healthcare system, in
general.
As Senator Whitehouse noted, overall, the U.S. spends 50
percent more of its GDP on healthcare than any other country
and in return we have somewhere between the 45th and 50th
longest life expectancy at birth in the world. In Rhode Island,
we implemented a strategy to help rebalance our delivery
system. This included a cap on the rate of growth in hospital
prices and a requirement that insurers increase the portion of
their healthcare spending going to primary care by 1 percentage
point a year for five years.
By making delivery system rebalancing a priority, since
then Rhode Island had catalyzed Medicare ACOs and new ways of
paying primary care practices, maintained one of the highest
levels of primary care providers per capita in the country,
which left the state better prepared to face the COVID-19
pandemic, supported a network of community health centers that
serves one in six state residents, inspired 21 other states to
report on or increase primary care spending, and we've improved
our ranking in the Commonwealth Fund's state health system
scorecard to fourth.
But most importantly, Rhode Island has greatly improved its
health insurance affordability relative to neighboring states.
Yet, these efforts amount to sandbags against the relentless
flood. Rhode Island is still subject to the grave primary care
prices facing the country. The Milbank Memorial Fund's annual
health review as a primary care scorecard released last week
documented that almost one in three Americans report they lack
access to a source of regular care. This figure is increasing
most dramatically for children.
The number of primary care physicians per person is
declining, the share of healthcare dollars going to primary
care is less than 1 in 20 and is dropping, and a grim future
lies ahead. About one in seven physicians is practicing primary
care five years after medical residency. That's not enough to
replace those retiring, let alone to match the levels found in
other countries. Medicare's fee schedule has created this
unbalanced delivery system and primary care crisis. How much
and how it pays is not delivering value for the Medicare
program or its beneficiaries. Medicare is the benchmark for all
of their payers, so this inefficiency has rippled through our
entire healthcare system.
In 2021, the National Academy of Science, Engineering, and
Medicine issued a report on implementing high quality primary
care. I was privileged to serve on that committee and in it we
studied Medicare's method of healthcare services valuation in
the role of the Relative Value Utilization Committee (RUC), an
advisory committee appointed by the American Medical
Association that assigns value to all physician services paid
by Medicare.
The nation report concluded 90 percent of the RUC's
recommendations are accepted by the Centers for Medicare and
Medicaid Services. The fee schedule implemented by Medicare
systematically devalues primary care services relative to other
services. This results in a compensation gap between primary
care and other physicians that is widened, driving what
specialty medical students chose and what graduate medical
education programs hospitals offer.
Given the five to one ratio of specialists to primary care
physicians on the RUC, these findings are not surprising. The
Government Accountability Office and numerous commentators have
pointed out the conflicts of interest in this arrangement. How
Medicare pays also contributes to the problem. Paying for each
service encourages the provision of care more highly valued by
the RUC members, procedures and testing, and discourages lower
price services and those with no fee valuation that are often
used by primary care clinicians, such as patient education,
care planning, and services delivered by non-licensed
clinicians, all of which help with the chronic conditions cited
by Senator Wyden.
Fee-for-service payments also discourage investments to
improved care, as we'll hear from Dr. Rauner, and leave
providers financially vulnerable in times of reduced demand for
in-person services, such as during the pandemic. This is a
self-perpetuating cycle. A committee dominated by specialists
systematically values specialty care over primary care.
Commercial payers follow suit. Specialists' income increase,
attracting a greater share of medical school students and
further destabilizing our delivery system. Medicare and the
country spend more and get less.
Given this, I offer four recommendations for Congress to
improve the effectiveness and efficiency of the Medicare
physicians fee schedule. First, revise the Medicare physician
fee schedule valuation process in the role of the RUC. Second,
direct CMS to annually report primary care spending levels
across all programs. Third, implement a hybrid payment
methodology, a blend of pre-enrollee and fee-for-service
payments in the Medicare fee schedule for primary care
clinicians and services. And finally, direct CMS to waive Part
B cost sharing for all services provided by whomever the
beneficiary has designated as their usual source of care.
Chairman Whitehouse. Thank you, Mr. Koller. Let me turn now
to Dr. Navathe.
STATEMENT OF DR. AMOL NAVATHE, ASSOCIATE PROFESSOR, PERELMAN
SCHOOL OF MEDICINE, AND THE WHARTON SCHOOL, UNIVERSITY OF
PENNSYLVANIA \4\
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\4\ Prepared statement of Dr. Navathe appears in the appendix on
page 46.
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Dr. Navathe. Chairman Whitehouse, Ranking Member Grassley,
and distinguished members of the Committee, thank you for the
opportunity to testify today.
Before I begin my substantive remarks, I would like to
emphasize that my comments reflect solely my beliefs and not
the opinions of any organization I'm affiliated with, including
Medicare Payment Advisory Commission (MedPAC), the University
of Pennsylvania Health System or Perelman School of Medicine.
Today I would like to highlight how Congress can enable
much needed transformation of primary care delivery in our
country. I've dedicated a substantial portion of my career to
this effort. I led the design of a new primary care payment
model, together with Blue Cross Blue Shield of Hawaii. In 2016,
we shifted to a hybrid model with a predictable monthly
payment, adjusted for the level of patient illness while
continuing to pay some services fee-for-service. This gave
primary care providers or PCPs flexibility to practice more
patient-centered care while streamlining operations. The
model's success led the plan to expand it statewide.
I would like to share four key points in support of
reforming primary care and physician payment. First, there's
near consensus amongst health policy experts that robust
primary care is required for cost efficient healthcare.
Medicare spends only 4 percent of its total spending on primary
care, which is far less, proportionally, than other high-income
countries.
Geographic regions within the U.S. that have more PCPs
achieve greater health with lower spending. For example,
Medicare spends 25 percent less per beneficiary in states with
many PCPs compared to those with few. Second, the current fee-
for-service payment system produces a misalignment between
provider incentives and patient health. This leads to
systematic under investment in primary care. In particular, the
payment rates in Medicare's physician fee schedule undervalue
diagnostic services in favor of procedural ones. This is an
issue throughout the fee schedule and exacerbates the incentive
to provide more services by shifting towards costly ones; thus,
Medicare spending goes up without producing additional health
benefits.
Third, granting CMS the authority to pay primary care
practices through a hybrid payment model is imperative to
strengthen primary care. A hybrid payment model would allow
practices to deliver more patient-centered care, change to more
efficient staffing models, and use technology like telehealth
when it is efficient and effective. The evidence for hybrid
payments is promising. In Hawaii, there were marked
improvements in quality. This included increased rates of cost-
effective prevention like cancer screening, as well as greater
cost saving care, such as end of life care planning.
To complement quality gains, there was greater use of
telehealth that predated the pandemic. In fact, unlike other
states where primary care practice finances were massively
disrupted by the COVID-19 pandemic, practices in Hawaii were
protected, financially. The success in Hawaii underscores the
stability that hybrid payments can impart to primary care.
Fourth, a hybrid primary care payment system is a linchpin
for reducing federal spending on healthcare. While not every
test of primary care payment reform has yielded overall
savings, key leading indicators are positive. Examples of
success include a 5 percent reduction in spending on outpatient
imaging among Medicare Advantage beneficiaries enrolled in
Hawaii's Blue Cross plan. To get a sense of magnitude, this
would translate to $368 million in savings if results
replicated across the Medicare program. CMS demonstrations lead
to reductions in use of expensive hospital care and emergency
department visits. The magnitude here reflects $5.4 billion in
annual savings if results replicated across traditional
Medicare.
The ability for primary care to drive savings is also
evident through the performance of accountable care
organizations or ACOs in the Medicare Shared Savings Program or
MSSP. Physician led ACOs are more successful than other ACOs.
To date, the MSSP has saved $1.8 billion, but when advanced
primary care models with hybrid payments have overlapped with
ACOs, the synergies have yielded even larger savings.
Hybrid primary care payments cannot be implemented at scale
without congressional action. Notably, CMS has conducted
demonstration projects with hybrid payments. It also has the
authority to implement hybrid payments in the MSSP, which is a
step that it should take. However, what we need now must be
nationwide and permanent. Demonstration projects, by nature,
are time limited and uncertain. This has led to under
investment by physician practices and lack of participation
from private payers; thus, the full benefits of hybrid payments
have not been realized. Only through congressional action can
CMS scale hybrid payments pass this tipping point of
transformation across the nation. Thank you for the opportunity
to share my testimony with you today.
Chairman Whitehouse. Thank you very much. Dr. Rauner.
STATEMENT OF DR. BOB RAUNER, PRESIDENT, PARTNERSHIP FOR HEALTHY
NEBRASKA, AND REPRESENTATIVE, AMERICAN ACADEMY OF FAMILY
PHYSICIANS \5\
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\5\ Prepared statement of Dr. Rauner appears in the appendix on
page 60.
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Dr. Rauner. Chairman Whitehouse, Ranking Member Grassley,
and distinguished members of the Committee, thank you for the
opportunity to testify today. As a family physician from
Nebraska, I'm honored to be here today representing the 129,600
physicians and student members at The American Academy of
Family Physicians, including myself.
I spent the first portion of my career practicing in my
hometown of Sydney, Nebraska, which is far out west, closer to
Wyoming, along with my wife, Lisa, who is also a family
physician. We moved there, in part, to replace my family
doctor, Doc O'Halloran, who, when I was in medical school, was
always telling my mom when is Bob going to come back so I can
retire?
The next phase of my career, we went to teaching at a
family medicine residency program so we could teach others how
to become rural family physicians. During that time is when the
electronic medical records were coming out and we installed one
and joined a research network across the country where we
started studying what was working in terms of systematic
quality in clinics. The problem was it was really hard to
sustain with the fee-for-service payment system. It took extra
work and there was no reward for it through fee-for-service.
So, I was happy in 2012 when the Medicare Shared Saving
Program came out with an advanced payment ACO contract. So, I
switched careers again and I recruited nine clinics to join
that advanced payment ACO, then we took what I learned from our
research networks and employed one of those nine clinics across
Nebraska. Within the first two years, we were one of the Top 10
highest quality scoring ACOs in the country as a group of
mostly rural family physicians, but we ran into sustainability
challenges when the advance payment money ran out, so we
started a second ACO in 2016. We started three clinics in
Lincoln and then grew that to 23 clinics in four communities.
In 2022, we were one of only 11 out of 482 ACOs across the
country that had greater than 90 percentile reductions in
costs, while also greater than 90 percentile quality numbers.
I'd like to point out one of the figures I include in my
testimony, and it's our savings over time since our first
contract. We had net savings for the first three years, but in
those three years we didn't meet the shared savings threshold,
so we received no money from Medicare Shared Savings Program.
We finally hit it in the fourth year, in 2020, but the
reconciliation takes another nine months. So, we actually
didn't get our first shared savings payment until the latter
half of 2021, a full five years after we started.
But we were able to sustain that for two reasons. Number
one, Nebraska was one of the Comprehensive Primary Care (CPC)
Plus intervention states. That meant for our Medicare patients
we got a risk adjustment per member per month payment that was
used to hire our care coordinators and fund our operations
during that time. In addition, it was a multi-payer option, so
Blue Cross/Blue Shield Nebraska also provided a per member per
month similar quality metrics, which is why in both the funding
and the quality goes across almost half of our payer mix, and
it was that investment that got us to the point now where we're
10 percent under budget in Medicare and over 20 percent under
budget on our Blue Cross contracts.
Shared Savings are possible in year one and two, but
sometimes those are false savings due to risk coding or
sometimes even denied and delayed care, which can come back to
bite you later on. I'm proud to say that One Health Nebraska
ACO did it the right way. We achieved true savings by focusing
on better chronic disease management, post discharge visits,
and increasing our annual wellness visit rates to 85 percent.
The combination of fee-for-service, per member per month
payments and shared savings actually gets us on those two
contracts to a 12 to 13 percent primary care spend rate, the
kind of spending that Chris Koller mentions is needed to
sustain this kind of high-quality care. I think future ACO
contracts should measure primary spend rates as one of the core
metrics to make sure the money is actually going to the right
place on these contracts.
And just like our experience before, I think to recruit
more primary care physicians in the ACO contracts we need a
model under MSSP that includes both the upfront funding to get
you off the ground, but the population-based payments to
sustain your operations over time. Thank you for the time to
offer this testimony.
Chairman Whitehouse. Thank you very much, Dr. Rauner. I've
got to say you've got my competitive juices flowing talking
about the success of your ACOs because Rhode Island has a
couple of superstar ones also. Ms. Grabert, please proceed.
STATEMENT OF LISA M. GRABERT, VISITING RESEARCH PROFESSOR,
MARQUETTE UNIVERSITY COLLEGE OF NURSING \6\
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\6\ Prepared statement of Ms. Grabert appears in the appendix on
page 68.
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Ms. Grabert. Chairman Whitehouse, Ranking Member Grassley,
and distinguished members of the Committee, I am Lisa Grabert,
a Visiting Research Professor in the College of Nursing at
Marquette University located in the good land of Milwaukee,
Wisconsin. I'm a former congressional staffer for the U.S.
House of Representatives Committee on Ways and Means and I'm
honored to testify before the Committee today on the Medicare
Program, a policy area where I've worked for over 20 years.
I applaud the Committee for addressing the important topic
of primary care. My written testimony includes several examples
from fee-for-service Medicare that were well intentioned, but
unfortunately, did not turn out the way many of us had hoped.
These programs include Accountable Care Organizations or ACOs,
the Center for Medicare and Medicaid Innovation or the CMII,
and the Independent Provider Advisory Board or IPAB. But I'm a
glass half full kind of person, so I will concentrate my oral
testimony on a virtual slam dunk, the expansion of telehealth
services.
To understand why telehealth was successful, we must first
spend time on the economic structure of Medicare Advantage or
the MA Program. The Medicare Program relies on a benchmark
system for MA plans. The benchmark is set on an annual basis
and represents a range of 95 to 115 percent of expected costs
and fee-for-service Medicare. A different benchmark is set for
each county in the U.S. based on a statutory formula. Each plan
submits an annual bid. The bid is reflexive of the services the
MA Plan intends to deliver to Medicare beneficiaries and these
services must include, at a minimum, what is covered by fee-
for-services. These minimum services are referred to as the
basic benefit.
If an MA plan submits a bid that is lower than the
benchmark, the plan receives a rebate. MA plans are required to
reinvest a portion of the rebate and plans typically reinvest
in premium reductions, reduced cost sharing, and supplemental
benefits. These supplemental benefits are key to understanding
why telehealth is such an important example to guide future
Medicare reform. The bipartisan Budget Act of 2018 included a
policy that allows MA plans to offer telehealth as a basic
benefit rather than as a supplemental benefit.
This bipartisan policy achieved two key things. The first
achievement was less taxpayer spending, which manifests as
lower annual bids. The Congressional Budget Office, or CBO,
estimated the MA telehealth policy saves taxpayers $80 million
and the Centers for Medicare and Medicaid Services, or CMS,
estimated this policy saved beneficiaries $557 million.
The second achievement of the policy was freeing up capital
within the category of supplement benefits. This economic
incentive allows plans to offer new benefits, such as enhanced
primary care. In a peer-reviewed study in press, my coauthors,
Dr. Grace McCormick, Dr. Erin Trish of the USC Brooking Schafer
Center, and Dr. Catherine Wagner of the Marquette College of
Business and I concluded that this switch from the supplemental
to the basic package is the first of its kind in the Medicare
statute.
This seemingly small, bipartisan policy change is lightning
in a bottle. A similar telehealth policy was implemented on the
fee-for-service side. Like the ACO, CMMI, and IPAP examples in
the case of fee-for-service telehealth it spends roughly five
billion dollars a year. The detailed research I've done on this
topic has convinced me that policymakers should solely focus
their limited time and resources in Medicare on MA changes, not
fee-for-service.
If my telehealth example is not convincing enough, just
listen to the footsteps of Medicare beneficiaries. They are
quickly moving towards MA. Just last year the proverbial scale
tipped, and the Medicare Program now consists of more MA
beneficiaries than fee-for-service beneficiaries. $13 million
new beneficiaries will be added to Medicare over the next 10
years. At a pace of nearly 10,000 Baby Boomers a day, MA is
projected to grow 42 percent while for fee-for-service is
projected to shrink.
The answer to enhancing primary care lies squarely within
the Medicare Advantage benefit. Any attempts to force change
within fee-for-service are misaligned with the future momentum
of the program. I thank you for the opportunity to offer my
perspective and I look forward to your questions.
Chairman Whitehouse. Thank you very much, and last, but not
least, Dr. Taylor. Delighted that you're here.
STATEMENT OF DR. CHRISTINA TAYLOR, CHIEF MEDICAL OFFICER, VALUE
BASED CARE, CLOVER HEALTH AND PRESIDENT-ELECT, IOWA MEDICAL
SOCIETY \7\
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\7\ Prepared statement of Dr. Taylor appears in the appendix on
page 78.
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Dr. Taylor. I'm Dr. Christy Taylor and I'm an internal
medicine physician from Iowa. I practiced for nearly 20 years.
I started out in a physician-owned multispecialty clinic, the
Iowa Clinic, and I was their first Chief Quality Officer and
then I was the Chief Medical Officer, McFarland Clinic where we
served both rural and urban patients. And throughout this time,
I've also served as the medical director of a multi-state ACO.
So, in my career, I've been deeply involved in transitioning
our organizations from fee-for-service to value-based care.
I've been blessed to work at organizations that
historically delivered exceptional care, but even we had to
change our focus from that of volume to patient access and
coordinating care to deliver the right care to the right
patients at the right time. And now, I'm the Chief Medical
Officer of the Value Division of Clover Health, an organization
which brings support and actionable patient information to
primary care providers.
So, in all of these settings, a fundamental aspect we
focused on is the critical role of primary care providers in
coordinating care. Patients who see primary care physicians
absolutely have lower overall total cost of care. In my clinic,
we focused on both patient access and engagement. We actually
improved quality of care and had significantly lower costs and
we were successful in our value-based contracts. We received
shared savings every single year.
The most meaningful results, however, were what we saw in
our patient outcomes, both in prevention and in disease
management. And most of this work was done by primary care
physicians and then we collaborated with other groups around
the country to share best practices and challenge ourselves
further. Our preventive care increased, things such as vaccines
and cancer screenings, and with actionable data and additional
personnel we manage chronic disease patients better, such as
those with hypertension and diabetes to help them get and stay
in better control. This resulted in healthier patients and
fewer Emergency Room (ER) and hospital admissions.
But along the way to value several investments were
necessary. We added additional personnel, such as care
managers, plus the technological and analytical resources to
make the data actionable. And these resources are outside the
scope of what we would call traditional care or regular
practice. For example, we put people and processes in place so
that we could get real time hospital discharge information so
that we could reach out to patients during these vulnerable
times in their healthcare and it required both timely data and
care managers in place to actually result in true care
coordination so that we could have good follow up, reduced
medical error, and readmissions prevented.
So, across multiple organizations, I've seen the positive
impacts that primary care providers who actually focus on value
have made. With the right resources we have safer, better care
at lower costs. But despite these successes, significant
challenges remain; namely, those of investment, administrative
burden, and lack of predictability. Transforming care does
require significant investment, which small or rural practices
either can't afford or accomplish at their scale. There's just
a base cost to personnel and then the patient and analytic
tools that you need are unaffordable for the small practices,
but without these important solutions we don't have the
critical information that we need to better care for patients
or avoid duplicate services.
This is frankly what drew me to my work at Clover so that
we could work with the primary care practices and provide them
these additional resources so they could serve their patients.
In the last several years, providers have experienced a
drastic uptick in administrative burden beyond the good medical
recordkeeping that you'd normally expect. There's additional
recording of information that's not impactful to patient care
and this burden is definitely heavier on the primary care
physician. We're taking precious time away from patient care
duties. Intentionally or not, we are adding strain to a
shrinking primary care workforce. We must decrease the
administrative burdens that are not directly impacting care.
And finally, we need more predictability. Frequent changes
in federal requirements and unstable payment arrangements are
challenging for all providers, more so the smaller ones. In
order for practices to be able to move to value and provide
coordination beyond traditional care, we need predictable and
sustainable reimbursement models.
In summary, primary care providers are the frontline of
coordinating care. Patients who see primary care physicians are
healthy and at a lower cost. We need to assist the primary care
providers to enter and remain in value-based programs. Thank
you very much.
Chairman Whitehouse. Thank you very much. After the hearing
is over, Dr. Taylor, I would invite you to sit down and make me
a punch list of the administrative burdens that you think are
least helpful and most aggravating and send that to Ranking
Member Grassley and myself for us to have in hand as we
proceed. And hearing your testimony and Dr. Rauner's testimony
makes me want to take you both out for a beer with Dr. Al
Puerini, who was the founding Chief Marketing Officer (CMO) of
Integra ACO Rhode Island and Dr. Al Kurose who was the founding
CMO of Coastal Medical and just let you tell me what we need to
do to continue to make those improvements. I really appreciate,
Dr. Rauner, particularly your success with the ACOs because I
think Coastal and Integra are right up there with you in that
uppermost performance corner.
Some ACOs were less successful than others and sometimes
the ACO program gets, I think, under appreciated because there
were unsuccessful programs. There were characteristics, I
think, to the very successful program. Dr. Navathe suggested
that where there was hybrid payment overlap with the ACO, that
boosted success. You said that where it's a primary care
physician ACO, uncomplicated existing practice, they were more
successful. That is my experience as well and I'd invite you to
think about and send in after the hearing, if you like, or if
you have a quick answer now, as you look at the whole ACO
experiment, what are the things we should take out of it where
we got the best wins? What are the things we really need to
replicate?
And I'll add that I had long wars with the Obama
Administration CMS folks about precisely the concerns that you
had. I used to tell them that the way you're dealing with
shared savings you are starving your lead dogs. You don't want
to do that. You want to feed your lead dogs. You want to
encourage that kind of behavior and thankfully they did a lot
of listening and we were able to make a lot of improvements off
where they initially were. So, I take a very keen interest in
ACO wellbeing. Any thoughts on that?
Dr. Rauner. Yes, a couple of things that shake out and the
studies have shown all the way back to 2016 that the ACOs that
were achieving the most success were the primary care led ACOs,
so this is not new information. That is probably the most
fundamental thing and I think a couple things. One is, if a
primary care physician led ACO, those primary care doctors are
all involved, and they know what they're doing.
I've actually talked to colleagues who were employed who
don't even know they're in an ACO. So, if you don't know you're
in an ACO, you're probably not going to do very well. A key
portion of what you're doing, honestly, is behavior change and
that takes relationship with the primary care doctor to get
your blood pressure and diabetes under control. Without that
relationship engagement of primary care physicians, it's really
hard to make happy, successful. A second factor is that you're
not necessarily locked into anything.
So, unfortunately, if you're in a narrow network, they're
locked into that narrow network. We're not. So, I can look in
Lincoln and actually do know that, for example, sometimes the
high-value cardiology in this system while the high-value
orthopedist is in another system and someone who's in radiology
is in an independent system that's wholly different from the
others. Because we're not locked in, we can send them to any of
those places and always do the best.
One of our first principles in our ACO, when we started it,
was we're going to send patients to the same place we're going
to send our mom or our kids and we're not going to sign a
contract that doesn't let us do that. I'm going to send my mom
and our kids to the place where I know is the highest value
stuff. And so, I think that's one of the other major things.
The third thing is because we're only a primary care led
ACO, when the money comes in it stays in the ACO. It gets
reinvested in the business. We just keep hiring more and more
care coordinators. If I had $200,000, I don't want to buy more
technology. I want to hire three more social workers or a
couple diabetes educators. Having that team wrapped around you
is the core thing. And the other things I see in some employ
models the primary care doctors are just plain understaffed.
The care coordinators are centralized, and you don't have the
relationship when it's a central phonebank person. But once the
nurse that you know at the clinic when Lupe calls, you're going
to listen to Lupe, and so I think those are kind of the three
main things that made the difference for us.
Chairman Whitehouse. Mr. Koller, when you were leading the
transformation in Rhode Island towards primary care, you were
dealing with a lot of statistics and tracking a lot of
statistics and seeing how that rolled out into insurance costs
and all of that. Did you also have occasion to take on or
absorb any of the more sort of experiential gains that Dr.
Rauner is talking about, about that improved patient
relationship between the primary care doctor and the patient
once they're in a mode like that where they're getting these
various supports?
And it's been my experience that people absolutely loved it
when their patients have all these new opportunities that the
ACO format and the primary care relationship provided, some of
which just doesn't get quantified because it's hard to
quantify, but Rhode Island is a small state and I expect you
heard a lot of feedback. What was it like?
Mr. Koller. Thank you, Senator Whitehouse. I think we did
balance this notion of evidence in relationships that you're
talking about. So, the evidence is what we talked about here
around the value of primary care, but at the core of what Dr.
Rauner and Dr. Taylor is describing is a relationship that
people have with their clinician and that relationship, that
trust that emerges is so important for the patient themselves.
And so, that's really what motivated us when we were trying to
do this work in Rhode Island. We had the benefit of a strong
community health center system with a lot of folks with that
kind of trust.
We had leading ACOs, as you talked about. Our primary care
efforts were really an effort to kickstart those in the way
that Dr. Rauner is talking about, to give them upstart funding
so they could build those sorts of relationships and it pays
off.
I also want to note it's especially important when we're
concerned about disparities in healthcare because often the
source of those disparities is a lack of a trusting
relationship. What brings me to this discussion is we're losing
those relationships. Almost a third of the folks in the country
say they don't have it right now and if we don't rebuild that
trusting relationship, Medicare is in deep trouble from a
financial and a security standpoint.
Chairman Whitehouse. Senator Grassley.
Senator Grassley. Dr. Taylor, we heard about how you've
achieved results in primary care clinics there. You mentioned
achieving increase in vaccines given, cancer screenings that
are completed and improved management of high blood pressure
patients, Emergency Room patients count is down, so explain to
us how we could scale your effective model, so prevention and
care coordination happens across the country? And specifically,
are physicians empowered to do this now or are there federal
barriers?
Dr. Taylor. Thank you, Senator Grassley for the question
and appreciate the opportunity to answer that. So, there's
really two parts to your question. And one is regarding how we
scale these efforts and I think there is always difficulty in
scaling something you do locally because healthcare and how we
deliver it is local, so you have to have different solutions in
different places for what makes sense for the patients and
their communities. So, you have to have the flexibility and
agility to put forth a solution in one community versus
another.
In a particular area in urban Iowa, we don't have a lot of
transportation issues, but you get to rural Iowa or rural
Midwest, or other parts of the country and you have significant
issues getting people to their doctor's appointments. So,
simply stating that transportation is something everyone needs
to work on, as an example, would not be something that you
would say everyone needs to do the same thing. The point is you
have to have flexibility in what your efforts are.
We really need a handful of things, universally, across our
country for the physicians locally to be able to put forth
their initiatives. And that is, we need data and then you need
your own tool, regardless of what that is, whether it's
telehealth or care managers or technological tools, that you
need data, tools, and then you need time, which means you need
personnel. You need doctors and nurses to be able to respond
and do the outreach in these extra things that are important
for coordinating care beyond what's done in just the office
visits. And so, these extra things that we're having doctors do
that take up more time for paperwork and phone calls that are
not patient care, we need to relieve them of those burdens so
they can spend the time coordinating the care instead.
Senator Grassley. Are there any federal red tape problems
to do what you just said?
Dr. Taylor. Well, there are several, one of which is that
we don't have a reimbursement model currently in the fee-for-
service side, which does appropriately reimburse physicians to
do these extra things beyond office visit care. At least in
Medicare Advantage and sometimes in the ACOs, we have more
flexibility there. There's supplemental benefits. There's
incentives that you can provide to primary care offices, and
so, when I've worked with various Medicare Advantage companies
over the years, they incentivize primary care offices to make
sure that your patients were seen to work on preventive
measures, to make sure the quality of care was ensured.
And so, making sure that we have a predictable, but yet,
able to reimburse us for the extra things beyond office care is
one of those. And then there are multiple, which we'll be happy
to work with you afterward, and provide a detailed list of the
small details which just take up an enormous amount of
physician and nursing time.
Senator Grassley. Thank you. And then I want to ask Ms.
Grabert, your testimony spoke about 2018 expansion to
telehealth in Medicare Advantage, saved Medicare money and laid
the groundwork for expanding telehealth utilization during the
pandemic. In fee-for-service Medicare telehealth expansion
costs money. Is Medicare Advantage an effective model for
expanding primary care benefits for seniors while also lowering
Medicare spending?
Ms. Grabert. Thank you for the question, Senator Grassley.
Yes, I do think that Medicare Advantage is the program to look
at for expanding primary care. One of the things I mentioned in
my written testimony is that Medicare uses what's called value-
based insurance design or VBID, for Medicare Advantage plans.
And in those experiments, which are similar to ACOs on the fee-
for-service side, they've identified a number of services that
you may want to think about potentially treating in the same
way you looked at telehealth in the 2018 bill.
Some of those examples under VBID for Medicare Advantage
are cost sharing reductions for medications, non-emergency
transport, which has been mentioned a few times already,
healthy food and grocery options, annual wellness and routine
physicals, smartphones, broadband, and Internet, roadside
assistance, and minor home repairs. These are services that
Medicare beneficiaries are getting under MA through the VBID
model, but those are small in nature, and they should be
considered for a nationwide expansion.
Senator Grassley. Thank you.
Chairman Whitehouse. Senator Johnson.
STATEMENT OF SENATOR JOHNSON
Senator Johnson. Thank you, Mr. Chairman. You know when I
was growing up, we had primary care physicians. We called them
family doctors and those doctors would doctor to the parents
and then the children as the children became adults. We don't
have that anymore and I guess what drives me nuts about these
hearings is we're just now looking at the root cause. We're not
going back in history and examining how did we go from family
doctors to a hearing right now where we're saying what we need
is family doctors. And I guess I would argue what changed is
the third-party payer system.
We have a completely broken healthcare financing system
which incentivizes specialties, that disincentivizes primary
care physicians, family doctors and until we recognize that
reality, we're not going to fix the problem. It wasn't that
many decades ago that the patients paid about 90 cents on the
dollar. Now, they pay 10 cents, so we've taken consumerism out
of this. We have physicians--80 percent used to be independent.
Now, 80 percent are part of organizations, and they are told
how to practice medicine.
They follow protocols. They follow guidelines. And I think
we saw during COVID if they have a different perspective,
they're vilified, and their careers are destroyed at times. So,
I think the solution here is we have to put physicians again at
the top of the treatment pyramid as opposed to being crushed at
the bottom by all the bureaucracy.
We've talked about chronic disease. I'll ask you, Dr.
Rauner, what research is being done to determine what is the
root cause of the chronic disease? Again, I've heard that we've
gone from something like 6 percent of the population to chronic
disease to the Rand Study saying 60. I don't know what the
start point is, but I think you'd probably agree. I think most
people agree we've really got a real problem with chronic
disease. What are we doing to figure out what caused it as
opposed to how do we treat it? We need to figure out how to
treat it, but the best thing is how to prevent it.
Dr. Rauner. Well, a couple things. We actually still do
have family doctors and then in Lincoln, Nebraska we're back to
almost 75, 80 percent are independent because of these
contracts, so we're actually reversing the trend in Lincoln.
And my niece, Brenna, is finishing up her family medicine
residency in Milwaukee, Wisconsin. I hear, unfortunately, she
might be staying in Wisconsin, so there's still some in
Wisconsin.
Senator Johnson. God's country.
Dr. Rauner. And then, we actually know exactly what's
causing the increased chronic disease is lack of exercise, poor
nutrition, and obesity. That's what's driving it. One of my
biggest fears, honestly, is the burden of the disease is
growing while our primary care workforce is shrinking, which is
a recipe for disaster in the next 10 years, so we need to
figure out----
Senator Johnson. Let me stop right there, okay, obesity.
You say lack of exercise. What about what we're putting into
our foods?
Dr. Rauner. Oh, yes.
Senator Johnson. I'm reading more and more pretty scary
information, for example, on glyphosate. It used to be used as
a pre-emergent weed killer. Now, we find out it's a desiccant
and now we're spraying it on food and it's in our food. I mean,
are we really seriously researching some of these issues?
Dr. Rauner. Yes. And it's actually something we're working
on. And so, you drink basically coffee in the morning and water
during the day, and maybe a beer in the evening, but it's all
the stuff in the beverages we drink, the sugar, the sweeteners,
all the additives. So, it's partly the calories. The calories
we drink are actually the biggest problem in obesity, but it's
the processed food. You should eat the food that, frankly, your
great grandmother recognized as food. A lot of what we buy off
the counter your great grandmother would not recognize it as
food. She'd say what the heck is that. And then, on top of
that, we just don't have people walking as much. I mean two of
my daughters live overseas and when we go visit them it's hard
not to walk 12 or 15,000 steps a day. In Lincoln, Nebraska, you
can get by with 4,000 and so those are the root causes.
Senator Johnson. Doctor, real quick, do you know what
percentage of drugs being prescribed are being prescribed off
label? It's a significant percentage. Correct?
Dr. Taylor. A significant percentage, yes. I can't give you
a precise number.
Senator Johnson. I held an event on Monday and one of the
doctors who testified at that event just talked about the
molecules, all these generic drugs that there were studies,
observational studies proved to be effective in treating COVID.
None of those were recommended. Actually, a lot of them were
sabotaged by the federal health officials all in favor of the
patentable drugs that are extremely expensive and the point
being is there's just no avenue for us to explore and do
research on generic drugs for different conditions than what
they're originally designed for. Would you think that's a
problem?
Dr. Taylor. Well, I think, as a physician, you're brought
back to our first responsibility is to do no harm and we all
live by that. And frankly, I don't prescribe a medicine if I
don't feel that I have to prescribe a medicine. The best
medicine is no medicine if you don't need it. And then,
frankly, we use lifestyle interventions and try to find things
beyond or before prescribing medicines. And then, you have to
look at the side effect profile in the individual patient, so
truly, you need to match the disease to the cure. And I don't
know that I can give you an answer in terms of how much work is
being done on generic----
Senator Johnson. I would like to think that most doctors
take your approach to like not use the medicines, but I don't
think that's really the reality. I think we're pushing
pharmaceutical drugs and products to treat these chronic
diseases left and right and really not paying attention to
adverse events the way we should, but that's my own personal
opinion, but thank you, Mr. Chairman.
Chairman Whitehouse. Let me drop in one question as Senator
Van Hollen gets settled. And if I may ask, Dr. Navathe, what
started the Hawaii hybrid? What's its origin story and who had
to approve it?
Dr. Navathe. Thank you, Senator, for the question. So,
there was an enterprising CEO at the Blue Cross/Blue Shield of
Hawaii named Mike Gold, who, as he was planning his retirement,
who said I want to do something that will really change the
health and the course of health in Hawaii. Just like the rest
of the country, there was increasing obesity, there was
increasing diabetes because of it and so he convened a set of
national experts and local folks, including physicians,
including current Governor Josh Green was there as well. And we
debated, basically, what are the best ways to really catalyze
health system change.
And the leading candidate was let's really invest in
primary care and let's change the system toward one that
provided more stability and robust infrastructure. And luckily,
Blue Cross/Blue Shield Hawaii actually has something like 60
percent market share, so when they said, hey, we're going to
shift over it really did catalyze some system transformation
and that's what kind of set the foundation.
Chairman Whitehouse. My Ranking Member has to leave and has
asked to ask one more question before he goes. Senator Van
Hollen has very courteously agreed to that, so let me turn to
Senator Grassley and then Senator Van Hollen.
Senator Grassley. Thank you for your deference. Just one
question to Dr. Taylor, and it's not a long one. But you talked
about supporting small and rural primary care practices as very
important. So, tell me how can partnerships between Medicare
Advantage plans and primary care practices improve access to
primary care?
Dr. Taylor. Thank you, Senator, for that question regarding
rural physicians, which are absolutely crucial for providing
patient care across this country. There's a couple of things
that Medicare Advantage companies and, frankly, all pairs. In
this case, you asked about Medicare Advantage companies.
There's a few things that you can do to help provide the
relationship or encourage the relationship between patients and
primary care. And that's, first of all, having an open
relationship where the pairs are able to actually talk with the
doctor practices, or at least their administration, to let them
know here's who your patients are. Sometimes it's just as
simple as that, is letting the physicians know here is who your
patients are and they provide information to the patients to
help encourage a visit with the primary care doctor.
So, first and foremost, it's literally trying to encourage
the patient to have a personal relationship with their
physician. In the Medicare Advantage sites, specifically, we
also have incentives for primary care physicians. Please get
your patients in for a primary care visit this year. Those
incentives work. They allow you to have the ability to hire
additional staff to do outreach to your patients and bring
these people in for their necessary preventive treatments.
Chairman Whitehouse. Thank you, Ranking Member Grassley.
Senator Van Hollen.
STATEMENT OF SENATOR VAN HOLLEN
Senator Van Hollen. Thank you, Mr. Chairman. Thank all of
you for your testimony today. I appreciate the good comments
about Hawaii's innovative systems for addressing some of these
issues. As many of you know, Maryland has also developed some
innovative models to reduce health spending while improving the
quality of care, including the State's all payer model and what
we have now, which is the total cost of care model, a key
component of which is the Maryland Primary Care Program.
In fact, according to a recent Journal of the American
Medical Association (JAMA) study, the Maryland Primary Care
Program had outcomes when it came to treating Medicare patients
and COVID that not only lowered the COVID-19 caseload, reduced
hospitalization death rates, but also found that the office
visits did not decrease because of the prospective payment
model.
So, Mr. Koller, I know, at least in your written testimony,
you mentioned the Maryland model. Can you elaborate on how more
efficient health spending and care delivery results from models
like Maryland's, the aim, of course, as I said, to reduce
hospital spending and incentivizing high quality primary care.
Mr. Koller. Thank you, Senator Van Hollen, and you're
absolutely right. Maryland has been an innovator in this area.
We're very familiar with the Maryland work. We salute it. We've
actually published some of the findings there. What's important
in the Maryland work, is as you note, the idea of putting the
entire system on a budget, a budget which actually benefits
health systems and hospitals because it gives them an assured
revenue, much as what we're talking about today for primary
care physicians. And that, as you note, the Maryland Primary
Care Program. It has been a partnership between CMS.
And to Dr. Navathe's comments, a large Blue Cross
organization, so you have dominant payers and the results have
been really significant, specifically in the JAMA study that
you cited, we also published it, a 20 percent lower mortality
rate during COVID for practices that were enrolled in that
Primary Care Program. It is a sterling example of what a
combination of hybrid payments, care transformation, and
persistence can produce that has saved lives in Maryland and
it's what we're trying to replicate for the entire Medicaid
beneficiaries.
Senator Van Hollen. Well, thank you for those comments
because I do believe that it, and maybe Hawaii. I'm less
familiar with the Hawaii model, but those kinds of models can
be important.
Dr. Navathe, could you just take a moment to pick up on
what Mr. Koller was discussing and how hybrid primary care
payment models work to mitigate against the challenges that we
find in a solo fee-for-service model and how the hybrid models
can better support a whole patient and team-based care?
Dr. Navathe. Thank you, Senator, for the question. So, I
think as the Maryland model very nicely exhibits, the hybrid
payments with a fixed perspective payment that's going to the
practices it allows them to invest in infrastructure, allows
them to staff in a way that reflects what is most efficient to
deliver care and meet the patients where they are. So, for
example, telehealth for a patient who wants to do a telehealth
visit or an in-person visit for somebody who wants to do that,
it allows them to use technology most efficiently.
But one thing I'd also like to highlight right alongside
that is it reduces administrative burden, right? Instead of
getting these tickie-tack codes where I have to code this and
code that where actually coding is more costly than the payment
you receive. It unshackles them from that system. It allows
them to invest in ways, as you highlighted, that can really
improve preventive care.
Senator Van Hollen. Got it. Thank you very much. Thank you
all for your testimony. Thank you, Mr. Chairman.
Chairman Whitehouse. Let me follow up on that, if I may,
because a number of you have mentioned the administrative
burdens. Folks like Dr. Rauner, who started an ACO, had to live
in an even worse environment where they had to run the fee-for-
service system while they built the ACO system. So, the
administrative burden actually went up during that process.
You're suggesting that a proper hybrid system drops a lot of
that reporting and coding out. That has been the experience in
the Hawaii hybrid.
Dr. Navathe. Yes. Thank you, Senator, for that question.
Yes, that's absolutely right. So, because the Blue Cross/Blue
Shield of Hawaii maintains so much market share, it's able to
push past that tipping point where practices can actually shift
over their operations.
Chairman Whitehouse. And just count on that one payment
model, basically.
Dr. Navathe. Correct. And so, they don't have to worry so
much about coding the Transitional Care Management (TCM) code
or Chronic Care Management (CCM) code or whatever that code is.
They can really focus on caring for patients because the
revenue is coming in the door.
Chairman Whitehouse. I'm told that we have another member
coming, so I get to indulge in a few more questions. So, this
may not be quite the right way to think about it, but the way I
think about it is that if you were building a house you would
hire your general contractor and your general contractor would
deal with the electrician, the plumber, the tile person, the
carpenters, and all of that. And if you had a problem, you'd go
to the general contractor and say could you please fix it.
That is a pretty basic and efficient and effective model.
And it strikes me that trying to move primary care physicians
into the general contractor model so that you go through the
primary care practice to get to the specialist would provide a
much better handle on the over deployment of specialists care.
And also, as you said, Dr. Rauner, lets you have a little bit
of a better-quality judgment about where the best places are to
send patients to.
This gets particularly interesting with ACOs because I can
remember Dr. Kurose and Dr. Puerini saying we actually bill
about 14 percent, I think was the number, of our patient cost
of care. That's the part that we directly control. The other 86
percent is specialists, it's hospitals, it's stuff that we
don't control. So, when we take on these risks, we're way
leveraged with stuff that is beyond our control. So,
presumably, not only could better general contractor status for
primary care folks reduce the excess utilization of specialist
services, but it could also deleverage the risk for ACOs. So, I
don't know if that makes sense to you all as a model, but let
me ask Dr. Rauner first and then Dr. Navathe, and Mr. Koller
what you think about that, and I'll turn to Dr. Taylor if
there's time.
Dr. Rauner. I think a lot of primary care doctors would
agree with that model, that they are basically kind of the
general contractor when done right. Now, some people just don't
have one and they do get random people from everywhere. I think
that's one of the problems is how do you know that it's the
right orthopedic surgeon or the right oncologist and that's why
we started with our principles. I'll send them to the same
place I would send my mom or my kids. So, the orthopedic
surgeon I'd encourage, I know the group he's with, and
literally, I got operated on there and so did my mom. But one
thing the ACO gives----
Chairman Whitehouse. But how do you reward your patients
for going to the provider of your recommendation and should the
system, in some way, encourage primary care selected specialist
rather than people who just go to their cousin's friend, the
specialist, and start their care there?
Dr. Rauner. Well, I think most of the time you just don't
need that, honestly. So, like there was a time where people
liked the, gatekeeper model, which we didn't really like at all
because I don't like being in that position to tell you, no,
you can't see that person. But most people, if they've been
seeing you for years, they trust your judgment and really
that's how you say it. It's like this is where I'd send my mom.
They're like, okay, I'm good with that.
I don't have to give them a lot of data. Although, in the
past, I'd say most of us physicians had no data to go by. I
think with these models now we actually do have data. I've got
a spreadsheet on my laptop where I literally have the
orthopedic surgeons in town with observed to expected outcomes.
It tends to confirm what I already knew, thankfully. But
there's a big difference, unfortunately. I wish I could say
every physician in the United States was equally good, but I
can't say that. And so, we (A) have the data to know and (B)
like Dr. Taylor said, every community's healthcare is local.
And if you don't know the specifics about this community--
Lincoln and Omaha are only 60 miles away, but they're totally
different medical communities. And knowing that, having that
local knowledge is really essential.
Chairman Whitehouse. Let me hold off on that with Senator
Padilla here and recognize Senator Padilla for his questioning.
We'll probably wrap up after that, so while I'm thinking of it,
if Dr. Navathe or Mr. Koller would like to respond to that and
take my question as a question for the record and put any
thoughts in writing about how to improve on the primary care
general contractor model that would be helpful to me, anyway.
Senator Padilla.
STATEMENT OF SENATOR PADILLA
Senator Padilla. Thank you, Mr. Chairman and thank you to
the witnesses for our participation today.
During and following the COVID pandemic, we witnessed
dramatic increases in emergency department visits for mental
health emergencies of all types, including suspected suicide
attempts. This uptick has been particularly pronounced among
children. I'm sure you've all read the reporting that I have.
To properly address the crisis, mental health professionals,
including child and adolescent psychiatrists need to meet
children where they are. The thing is as professionals, we all
can agree to that. This includes in primary care settings, in
pediatricians' offices, many times in schools, but I understand
that providers have faced difficulties in aligning mental
health services with existing billing codes.
However, I also understand that there's many innovative
models out there, including the collaborative care model that
offer primary care providers a way to both bill and be
reimbursed for the integration of behavioral health managers
and psychiatrists into their practice. The question is for Mr.
Koller. How can integrative behavioral care models such as
collaborative care and child psychiatry access programs help
increase access to mental and behavioral health providers,
particularly for underserved populations?
Mr. Koller. Thank you very much, Senator. I would second
your remarks about, first, the behavioral health crisis and
then the ability of primary care to contribute to that. And
there are numerous demonstrations that properly trained, and
properly resourced primary care clinicians can both provide
frontline behavioral healthcare and then the collaborative care
model that you're talking about.
A number of the things that we've talked about today, the
idea of a hybrid payment or paying on a per-patient fee allows
primary care practices to build the capacity to hire social
workers to develop other staff to do the kind of screening
necessary to implement behavioral health model. And I guess the
other piece I would add is that we have numerous examples
within the community health centers which have not been
shackled by Medicare fee schedule where they've been able to
build exactly that capacity to meet the needs of kids that
you've been so adamant about. Thank you.
Senator Padilla. And just a couple of follow ups for you,
do you see any benefit these models present in addressing the
workforce shortages, both in the physical and the mental areas?
Mr. Koller. Yes, we're extremely concerned about workforce
shortage. We, being the Milbank Memorial Fund. We think, to
Senator Whitehouse's comments, we're worried that there aren't
going to be enough general contractors. We support the model.
We just don't think we're training enough general contractors
and the root of that is the Medicare fee schedule. We have to
create incentives for physicians, clinicians, advanced
practitioners who are training to choose primary care so that
we can build the kind of capacity that you're talking about.
Senator Padilla. So, that increased efficiency through the
collaborative model for your much needed resources.
Mr. Koller. Absolutely.
Senator Padilla. And then, another follow up. There's 33
states that have adopted some sort of collaborative care model.
What can we do to encourage those that haven't yet to do so?
Mr. Koller. Well, particularly given your concern, and it's
entirely appropriate about underserved populations, I would
look at the catalytic role of Medicaid programs. Medicaid
serves almost one half of the kids in the country. Congress has
authority over that and can work with Center for Medicaid and
CHIP Services (CMCS) to create incentives for states to develop
that kind of capacity, whether it's through managed care
programs through their fee-for-service. So, I think Medicaid is
a powerful lever to spread the kind of work that you're talking
about.
Senator Padilla. Thank you very much. Thank you, Mr. Chair.
Chairman Whitehouse. Senator Kaine.
STATEMENT OF SENATOR KAINE
Senator Kaine. Thank you, Mr. Chair. And to the Chair and
Senator Grassley for having this important hearing. I want to
ask a question about the way to support diverse healthcare
providers in innovative models that we are rolling out, value-
based models. And let me talk about a primary care physician
who practices in Richmond named Lerla Joseph. I've known Dr.
Joseph since I was on the City Council and Mayor. She's an
African American woman. She serves predominantly African
American community in Richmond, Virginia. Her patients are more
likely to be uninsured or underinsured and they're more likely
to have multiple chronic conditions that require significantly
complex management.
When the Affordable Care Act (ACA) was passed, Dr. Joseph
saw the growth of value-based care movement as an opportunity
to look for new ways to provide care for her patients. And
since then, she has successfully participated in accountable
care models, resulting both in cost savings, but also improved
patient outcomes. But as part of this journey, she's realized
that we, as Congress, but also the CMMI could do more to
support diverse providers, rural providers, small providers. As
she says, equality is one thing, but equity is another. She
believes a lot of the focus on building these value-based care
models have focused on larger providers and not necessarily
those serving rural or minority communities.
Not every provider is starting from the same starting
point. Some need more support than others to make the
transition of value-based care. And it seems obvious to me that
we could do more to support diverse providers and we should.
So, perhaps I'll just start with you, Dr. Navathe. What more
can Congress in the Center for Medicare and Medicaid Innovation
do to support diverse providers serving their communities when
it comes to these value-based care innovations?
Dr. Navathe. Thank you, Senator, for this very important
question. So, I think, just taking one quick step into the root
cause might help understand. So, when CMMI typically tests
modeling, it tests in a voluntary framework where providers
have to raise their hand and say I want to join. Perhaps it's
not surprising then that well-resourced providers who can bear
risks and can make investments end up joining and so we don't
get a representative population.
We then look at the results and the practice innovations
for those models and we try to scale them and that doesn't
always work for diverse populations. So, I think as we think
about what CMMI and others can do to help kind of boils down to
maybe three things. One, we need models that are really truly
directed towards safety net providers, toward rural providers,
toward providers that take care of diverse populations so
there's increased investment in technical support for them.
Secondly, when we do voluntary models, we have to check for
representativeness. We have to make sure that we're actually
getting participation from those or create better incentives
for that to happen. And third, rethink this paradigm of
voluntary to mandatory. This idea of we're just going to let
whoever raises their hand then scale what happens. We may have
to rethink that to begin with.
Senator Kaine. Can I then, Mr. Chairman, get on a soapbox
here that I wasn't intending to get on, but based on Dr.
Navathe's answer, this equality versus equity thing some people
seem to be really worried about the word ``equity.'' And yet,
you've just given a perfect example. Participation in a program
first-come-first-served, raise your hand, that is as equal as
can be, but it's not going to produce the right health outcome.
It's not. When we started to finally deploy vaccines that were
developed in COVID, we said anybody over 65 can get them.
That's as equal as can be, but we found after about three
months of that was some people over 65 don't know how to use a
computer. And in my neighborhood, they were searching
Walgreen's has it today and then it's the CVS across town.
Those had the computer and the time to use it, they were
getting vaccines. And those who didn't have the computer or
didn't have the time to use it or had a day job, even if they
were over 65 and didn't have the time to spend, they were not
getting vaccinated and then 90 days into the vaccination
rollout, the communities that were getting hit hardest with
COVID were being under vaccinated compared to others.
Now, everyone is eligible if you're age 65. That is an
equality policy. There's nothing unequal about that, but it was
producing an inequitable result that was actually hurting the
health outcomes of the people who were most affected by COVID.
So, we actually learned as we're then in the deployment of
vaccines and we switched to models where we're going to do
vaccine clinics in public housing communities. We're going to
do vaccine clinics in rural places where folks might not have
the CVS so close to them that somebody else does. And then,
over time, the vaccination rates started to sort of more
equalize among the population, but to do that we had to be
intentional about it. And in the health space, I can think of
about 50 examples of this where the policy that is an equality
policy is not going to produce an equitable result. But maybe
more importantly, it's not going to produce the result that's
right in terms of health outcomes that we're seeking. And so, I
really appreciate you sharing that answer. And Mr. Chair, I'll
yield back to you.
Chairman Whitehouse. Senator Braun.
STATEMENT OF SENATOR BRAUN
Senator Braun. Thank you, Mr. Chairman. I've got a variety
of subjects to talk about. Sixteen years ago, this whole
malaise that encompasses the healthcare part of our economy was
sick and tired of how lucky I was that my costs are only going
up 5 to 10 percent a year, had a business that had nearly 300
employees then. For 17 years prior, probably had 20 to 25. It
was a much smaller part of our GDP. Didn't have to worry very
much about it. But to really get a grip on it, I was large
enough to self-insure, which they didn't tell me the year
before because they were making so much on the prior plan. And
then I poured everything and the kitchen sink at prevention and
wellness and then did what it took then to create healthcare
consumers out of my employees. You know what happened? We've
not had a premium increase for my employees in over 15 years.
That's unheard of, but it was so simple to do. So, my first
question is going to be on a particular part of healthcare
reform that involves hospitals.
And I'm going to start with Ms. Grabert. Site-neutral
pricing, you know what that is. You know how the big hospital
chains end up buying all these other places, all of a sudden
jack up the costs based on overhead factors. This is very
simple here. What is that doing in our healthcare costs when
they buy places that were doing it for less money and for no
reason end up jacking up the prices and keep the competitive
prices that were in place all of a sudden, they're gone.
Explain what site-neutral is to people out there who may not
understand it clearly.
Ms. Grabert. Thank you for the question, Senator Braun. I'm
a big fan of your Site-based Invoicing and Transparency
Enhancement (SITE) Act. It's a bipartisan bill that's been
introduced in the Senate and it targets a payment peculiarity
within fee-for-service Medicare. I call it a peculiarity where
outpatient offices receive what's called a facility fee for the
services they provide. The same services could be provided in
an independent primary care office, and they do not receive the
facility fee, so there's a discrepancy in the reimbursement
rates that Medicare pays, and it hurts the competition, it
incentivizes things like consolidation, which are not good for
the healthcare system, and it costs Medicare beneficiaries
more.
Medicare beneficiaries pay a percentage of cost sharing for
every service that they have. If a facility fee is something
that they're exposed to, they pay more out-of-pocket every time
they go to that outpatient facility versus an alternative like
the physician office. So, it's not good for the healthcare
system, it's not good for competition, and it's not good for
Medicare beneficiaries.
Senator Braun. Well put. And with all that, I've got a
Democratic sponsor, Senator Hassan, and Senator Kennedy on my
side. Every senator ought to be on that if we're wanting to
lower costs.
Ms. Grabert. I agree. I think every senator should be on
that bill.
Senator Braun. Okay. I knew you would. Dr. Taylor, when it
comes to healthcare transparency and competition, which was the
hallmark of what I did. I've got another bill out there that
was introduced, believe it or not, with me and Chairman Sanders
of the Health, Education, Labor, and Pensions Committee, with
the simple idea that if we are going to bring costs down for
the government or through the private pay plans, we've got to
have information that everyone can see to make an educated
decision on what kind of healthcare they want. What do you
think for hospitals and insurers; is it going to be wise to
have them list, in not a cryptic form, prices of everything
they're doing, even some of the agreements they make between
themselves to try to cloak all of it to keep us from being
healthcare consumers?
Dr. Taylor. Thanks, Senator Braun, I appreciate the
opportunity here. First of all, I guess I would applaud your
shining a light on the need for cost transparency. The first
thing I think we do is we start with our medical students and
our residents in training and teach them about cost of care.
It's often not even part of our training to understand costs,
even as physicians. So, one of the things you've heard
throughout testimony today is we've each talked about the
importance of their being either a physician led something,
physician led ACO, a physician led organization. So, you need
to bring providers to the center of the organization and expect
us to pay attention to costs. And when you have a physician led
ACO or organization, then you're putting that in the driver's
seat there. So, it helps when we all know that we are supposed
to be caring about costs.
And then on the transparency side, I'll use your site
neutrality as a perfect example. Most people, general
population, laypersons are not aware that getting their
screening colonoscopy in an outpatient center would be a
different cost than doing it in a hospital. It's not quite as
simple as saying it's just listing the costs, but they should
be aware that there is a cost difference and then they should
be educated to ask is there a reason that I need to get this at
a higher cost site of services?
Senator Braun. One of the other things we did was a pre-
biometric screening, and it was one of the best investments I
ever made. Dr. Rauner, would you want to briefly weigh in on
this topic as well?
Dr. Rauner. Yes, I tell people my single biggest surprise
taking on this role is I knew there was price variation and I
always thought it was 20, 30 percent. In Lincoln, Nebraska,
it's tenfold, and one of our biggest challenges was figuring it
out, actually. And so, although it took us a while for
Medicare, we actually saved money pretty quickly with our
commercial plan because we figured it out, but we didn't do it
with information they gave us. We did it with information on
our Explanation of Benefits (EOB) for our own family members
because they have to tell us what they asked us to pay. And so,
we quickly realized, for example, in my own EOBs and other
colleagues, we started looking at how much--because it's $1,800
to $8,000 for a colonoscopy, depending on where you went, same
gastroenterologist, same scope, same meds. It's simply the
site. The lab was a tenfold difference. So, if you could figure
that out, and what consumer wouldn't want to figure that out,
the problem is we found that the insurance companies had often
had gag clauses where they couldn't share the information with
us, so we had to find creative ways to figure that out. But
boy, you can save a lot of money, and then the biometrics are
huge. There's some employee wellness that's done right and
there's some employee wellness that's done wrong, so I
congratulate you for going the biometric route. That's really
how you have to make----
Senator Braun. Thank you so much. It's prevention,
wellness, competition, transparency. Everybody else lives with
competition and transparency. The healthcare industry ought to
as well.
Dr. Rauner. Amen.
Senator Braun. Thank you.
Chairman Whitehouse. Thank you all. I very much hope that
your testimony and all of the responses and engagement from my
colleagues create a platform for some really important
bipartisan work. I think it is very clear, almost indubitably
clear, that by reforming the payment system we can free up
innovation and better patient response to primary care
providers. We can reward them better so that the primary care
cost reduction effect has more sway through the healthcare
system, that patients will enjoy better outcomes, and a way
better patient experience in that environment, and that the
shackles of a pure fee-for-service system are not helpful as we
move forward. And each of you from different academic, policy,
practitioner, and legislative backgrounds, I think, have
contributed to that message. So, I hope that we can continue to
go forward to build bipartisan legislation that will achieve
those goals.
And to those of you who I asked to provide a response to a
question for the record in writing, you have a chance to
deliberate about it, please do so. We would ask that they be
answered as quickly as possible. If there are other questions
for the record that members would like to ask, we'll send them
to you. Those are due by noon tomorrow or else forget it. So,
if anybody comes in by noon, we'll let you know. If not, you're
off the hook with only the questions that are pending. Let me
thank you very much for appearing before the Committee today.
You provided very, very thoughtful and helpful full written
statements and those will be part of the record of the hearing.
Thank you for the diligence of the long, full statements that
you prepared. And again, if we do get you question, if you
could get answers back to us within seven days that helps us
conclude the process of this hearing.
With no further business before the Committee, the hearing
is adjourned.
[Whereupon, at 11:44 a.m., Wednesday, March 6, 2024, the
hearing was adjourned.]
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