Coverage Proposals Examined in U.S. House Hearing; Hospitals Advocate to Build on Progress in Expanding Access to Comprehensive Coverage > Hospital Association of Pennsylvania

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Coverage Proposals Examined in U.S. House Hearing; Hospitals Advocate to Build on Progress in Expanding Access to Comprehensive Coverage

June 13, 2019

In the face of strong public attention to the affordability of health care and political interest by Democrat Presidential hopefuls in a single-payer regime in which government operates a tax-funded health insurance plan for all residents, in a hearing this week, the U.S. House Ways & Means Committee explored policy options to expand access to health coverage.

In the hearing—Pathways to Universal Health Coverage—the Committee reviewed a range of ideas including:

  • Strengthening existing law
  • Providing for an option to buy a Medicare or Medicaid-like public plan
  • Establishing a single-payer “Medicare for All” health care system

The American Hospital Association (AHA) offered perspective to the committee, in a letter, stating “America’s hospitals and health systems are committed to the goal of affordable, comprehensive health insurance for every American and believe we should build upon and improve our existing system to increase access to coverage and comprehensive health benefits. However, we have concerns with “Medicare for All” and believe that the variety of proposals that often are used interchangeably under that name are not the solution.”

During February, progressive leaders in Congress introduced H.R. 1384, the Medicare for All Act of 2019, which would transition all Americans into a government-run, single-payor, universal Medicare program over two years, eliminating private insurance. The legislation would make it unlawful for a private health insurer or employer to provide the same benefits as the new program, and would pay for hospital services under a global budget.

The Congressional Budget Office (CBO) released a report in early May focusing on key design components and considerations for policymakers interested in establishing a single-payor system. The CBO report speaks to the complicated undertaking in defining the sources and extent of coverage, payment rates for providers, and financing methods.

The CBO report specifically highlighted the implications of paying providers at Medicare rates stating “such a reduction in provider payment rates would probably reduce the amount of care supplied and could also reduce the quality of care.”

The AHA’s letter to the Ways & Means Committee reinforced concerns about the impact of underpayment in a single-payor system, stating “payment under existing public programs, including Medicare and Medicaid, historically reimburse providers at less than the cost of delivering services.” A report modeling the impact of a legislative proposal to offer a Medicare-like public health insurance plan on the health insurance exchanges would result in a $774 billion reduction in hospital payments between 2024 and 2033.

The AHA’s letter also emphasized the impact to existing coverage—cautioning the Committee that Medicare for All would move more than 250 million people into a new form of coverage, and alter the coverage for more than 55 million Medicare beneficiaries.

Similar to previous hearings in the U.S. House Rules Committee and U.S. House Budget Committee, the Ways & Means Committee framed the hearing as an opportunity to think about the opportunities and challenges of various policy options; consider potential consequences and impacts; and hear the perspectives of various stakeholders.

The hearing featured testimony by a patient advocate and representatives from Manatt Health, the Washington Health Benefit Exchange, Institute for Healthcare Improvement, Galen Institute and Kaiser Family Foundation.

In his line of questioning to the expert panel, Representative Mike Kelly (R, PA-16) emphasized concern that Medicare for All would disrupt employer-sponsored coverage for his constituents and have serious financial consequences for the hospitals in his Congressional District, half of which are already operating at a negative total margin. He also questioned what red tape and administrative burdens would be placed on health care providers as a result of the government run health care system.

Pennsylvania hospitals support efforts to ensure coverage for all individuals and look forward to continuing to engage with the Pennsylvania Congressional Delegation to inform policy conversations about expanding access to coverage and care.

HAP believes the existing framework—which offers subsidized coverage through health care insurance exchanges reflecting the market in each state, combined with expanded access to Medicaid—is the most viable mechanism to expand coverage and reduce costs.

For more information, contact Laura Stevens Kent, HAP’s vice president, federal advocacy.

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