TODAY'S HEARING: HOSPITAL SYSTEMS' CONSOLIDATION AND OPAQUE BILLING PRACTICES DRIVING THE HEALTH CARE AFFORDABILITY CRISIS

The following information was released by the America's Health Insurance Plans (AHIP):

by AHIP

As the House Ways and Means Committee convenes a hearing to examine the central role of hospital systems in the health care affordability crisis, health plans and other stakeholders continue to support common-sense policy solutions to rein in hospital systems' anticompetitive consolidation, opaque billing practices, and ever-higher prices.

What AHIP Is Saying:

"Hospital costs account for more than 40 cents of every premium dollar more than any other category and many hospital systems continue to raise their prices at rates that dwarf inflation while also sticking patients with high bills with layers of opaque fees. Instead of blaming others, the hospital industry should stop their anticompetitive consolidation, opaque billing practices and unaffordable price hikes that continue to drive Americans' premium costs higher." Chris Bond, AHIP Spokesperson

The Facts on Rising Hospital Costs:

Hospitals are the single largest driver of higher premium costs. Hospital-based care including inpatient, outpatient and emergency room costs accounts for more than 40 cents of every premium dollar in the commercial market, and hospital spending now exceeds $1.6 trillion nationally. Meanwhile, national health care spending grew by 7.2% in 2024, reaching a record $5.3 trillion, with hospital care among the leading contributors to that growth.

Anti-competitive consolidation has handed hospitals unchecked pricing power. Hospital markets are increasingly dominated by a few large systems, with three-fourths of U.S. metro areas classified as highly or very highly concentrated.

The same service, a sharply higher bill. For services commonly provided in both settings, prices in hospital outpatient departments were consistently higher than in physician offices, with price ratios up to 13 times higher for the exact same services. These opaque facility fees inflate costs without improving care. Routine services and primary care are increasingly billed in hospital-affiliated facilities instead of physician offices or ambulatory surgical centers and facility fees and other hospital billing practices mean higher costs year after year.

Solutions to Improve Affordability:

Health plans are doing everything in their power to shield Americans from the high and rising costs of medical care and are committed to working constructively with policymakers to advance common-sense, bipartisan reforms. Policymakers have a clear opportunity to act, including:

Protecting consumers with site-neutral payment reforms to level the playing field on prices, reduce patient cost-sharing, and lower premiums saving more than $170 billion over 10 years.

Promoting greater competition among hospitals by blocking anticompetitive hospital mergers.

Requiring price transparency so patients and employers can see what they're actually paying for.

It's time for policymakers to hold hospital systems accountable.