[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
THE PRESIDENT'S HEALTH CARE LAW DOES NOT EQUAL HEALTH CARE ACCESS
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON HEALTH
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
JUNE 12, 2014
__________
Serial No. 113-153
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the Committee on Energy and Commerce
energycommerce.house.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
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COMMITTEE ON ENERGY AND COMMERCE
FRED UPTON, Michigan
Chairman
RALPH M. HALL, Texas HENRY A. WAXMAN, California
JOE BARTON, Texas Ranking Member
Chairman Emeritus JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky FRANK PALLONE, Jr., New Jersey
JOHN SHIMKUS, Illinois BOBBY L. RUSH, Illinois
JOSEPH R. PITTS, Pennsylvania ANNA G. ESHOO, California
GREG WALDEN, Oregon ELIOT L. ENGEL, New York
LEE TERRY, Nebraska GENE GREEN, Texas
MIKE ROGERS, Michigan DIANA DeGETTE, Colorado
TIM MURPHY, Pennsylvania LOIS CAPPS, California
MICHAEL C. BURGESS, Texas MICHAEL F. DOYLE, Pennsylvania
MARSHA BLACKBURN, Tennessee JANICE D. SCHAKOWSKY, Illinois
Vice Chairman JIM MATHESON, Utah
PHIL GINGREY, Georgia G.K. BUTTERFIELD, North Carolina
STEVE SCALISE, Louisiana JOHN BARROW, Georgia
ROBERT E. LATTA, Ohio DORIS O. MATSUI, California
CATHY McMORRIS RODGERS, Washington DONNA M. CHRISTENSEN, Virgin
GREGG HARPER, Mississippi Islands
LEONARD LANCE, New Jersey KATHY CASTOR, Florida
BILL CASSIDY, Louisiana JOHN P. SARBANES, Maryland
BRETT GUTHRIE, Kentucky JERRY McNERNEY, California
PETE OLSON, Texas BRUCE L. BRALEY, Iowa
DAVID B. McKINLEY, West Virginia PETER WELCH, Vermont
CORY GARDNER, Colorado BEN RAY LUJAN, New Mexico
MIKE POMPEO, Kansas PAUL TONKO, New York
ADAM KINZINGER, Illinois JOHN A. YARMUTH, Kentucky
H. MORGAN GRIFFITH, Virginia
GUS M. BILIRAKIS, Florida
BILL JOHNSON, Ohio
BILLY LONG, Missouri
RENEE L. ELLMERS, North Carolina
_____
Subcommittee on Health
JOSEPH R. PITTS, Pennsylvania
Chairman
MICHAEL C. BURGESS, Texas FRANK PALLONE, Jr., New Jersey
Vice Chairman Ranking Member
ED WHITFIELD, Kentucky JOHN D. DINGELL, Michigan
JOHN SHIMKUS, Illinois ELIOT L. ENGEL, New York
MIKE ROGERS, Michigan LOIS CAPPS, California
TIM MURPHY, Pennsylvania JANICE D. SCHAKOWSKY, Illinois
MARSHA BLACKBURN, Tennessee JIM MATHESON, Utah
PHIL GINGREY, Georgia GENE GREEN, Texas
CATHY McMORRIS RODGERS, Washington G.K. BUTTERFIELD, North Carolina
LEONARD LANCE, New Jersey JOHN BARROW, Georgia
BILL CASSIDY, Louisiana DONNA M. CHRISTENSEN, Virgin
BRETT GUTHRIE, Kentucky Islands
H. MORGAN GRIFFITH, Virginia KATHY CASTOR, Florida
GUS M. BILIRAKIS, Florida JOHN P. SARBANES, Maryland
RENEE L. ELLMERS, North Carolina HENRY A. WAXMAN, California (ex
JOE BARTON, Texas officio)
FRED UPTON, Michigan (ex officio)
(ii)
C O N T E N T S
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Page
Hon. Joseph R. Pitts, a Representative in Congress from the
Commonwealth of Pennsylvania, opening statement................ 1
Prepared statement........................................... 3
Hon. Frank Pallone, Jr., a Representative in Congress from the
State of New Jersey, opening statement......................... 4
Hon. Gene Green, a Representative in Congress from the State of
Texas, opening statement....................................... 5
Hon. Michael C. Burgess, a Representative in Congress from the
State of Texas, opening statement.............................. 5
Hon. David B. McKinley, a Representative in Congress from the
State of West Virginia, opening statement...................... 6
Hon. Henry A. Waxman, a Representative in Congress from the State
of California, opening statement............................... 7
Hon. Fred Upton, a Representative in Congress from the State of
Michigan, prepared statement................................... 104
Witnesses
Scott Gottlieb, Resident Fellow, American Enterprise Institute... 35
Prepared statement........................................... 38
Answers to submitted questions............................... 106
William F. Harvey, Chair, Government Affairs Committee, American
College of Rheumatology........................................ 46
Prepared statement........................................... 48
Answers to submitted questions............................... 111
Monica Lindeen, Commissioner, Securities and Insurance, Office of
the Montana State Auditor...................................... 56
Prepared statement........................................... 58
Answers to submitted questions............................... 118
Submitted Material
Letter of June 12, 2014, from Dan Weber, President and Founder,
Association of Mature American Citizens, to Mr. Pitts and Mr.
Pallone, submitted by Mr. Pitts................................ 9
Statement, ``Health Insurance Reform Reality Check,''
WhiteHouse.gov, submitted by Mr. Pitts......................... 10
Report of May 6, 2014, ``Private Health Insurance Market Reforms
in the Affordable Care Act (ACA),'' Congressional Research
Service, submitted by Mr. Pitts................................ 11
Statement of June 12, 2014, by Claire McAndrew, Families USA,
submitted by Mr. Pallone....................................... 77
Article, undated, ``Mikulski Postpones Vote on Health Spending
Bill,'' by Andrew Taylor, Associated Press, submitted by Mr.
Gingrey........................................................ 96
THE PRESIDENT'S HEALTH CARE LAW DOES NOT EQUAL HEALTH CARE ACCESS
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THURSDAY, JUNE 12, 2014
House of Representatives,
Subcommittee on Health,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 9:59 a.m., in
room 2123, Rayburn House Office Building, Hon. Joseph R. Pitts
(chairman of the subcommittee) presiding.
Members present: Representatives Pitts, Burgess, Shimkus,
Murphy, Blackburn, Gingrey, Griffith, Bilirakis, Ellmers,
Pallone, Capps, Schakowsky, Green, Barrow, Christensen, Castor,
Sarbanes, and Waxman (ex officio).
Also present: Representative McKinley.
Staff present: Clay Alspach, Chief Counsel, Health; Gary
Andres, Staff Director; Sean Bonyun, Communications Director;
Noelle Clemente, Press Secretary; Paul Edattel, Professional
Staff Member, Health; Brad Grantz, Policy Coordinator,
Oversight and Investigations; Sydne Harwick, Legislative Clerk;
Sean Hayes, Deputy Chief Counsel, Oversight and Investigations;
Robert Horne, Professional Staff Member, Health; Katie Novaria,
Professional Staff Member, Health; Chris Pope, Fellow, Health;
Chris Sarley, Policy Coordinator, Environment and the Economy;
Heidi Stirrup, Policy Coordinator, Health; Ziky Ababiya,
Democratic Staff Assistant; Debbie Letter, Democratic Staff
Assistant; Karen Nelson, Democratic Deputy Committee Staff
Director, Health; and Matt Siegler, Democratic Counsel.
Mr. Pitts. Ladies and gentlemen, if you will take your
seats. The subcommittee will come to order.
We are going to have votes shortly, so we are going to run
a tight gavel this morning.
The Chair will recognize himself for an opening statement.
OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN
CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA
The President's health care law was sold to the American
people with a number of promises: If you like your plan, you
will be able to keep it; if you like your doctor, you will be
able to continue seeing him or her. Advocates of the law made
this promise again and again. In fact, President Obama,
according to one count, made this promise nearly 37 times.
Yet, as we now know, this promise was simply not true. Last
year, millions of Americans had their health plans canceled,
were forced to enroll in exchange plans. Americans are also
learning another sad truth: Health plans offered in the
exchanges are often not providing access--access to doctors,
hospitals, and drugs they need.
Why is this occurring? As we will hear today, many of these
problems lie at the feet of the Affordable Care Act. The
Affordable Care Act includes a number of benefits--mandates--
imposed on the plans consumers can buy. The law also adds
hundreds of billions of dollars in new taxes that are being
passed on to patients. And this leaves insurers with only a few
tools to control and manage cost.
As a result, many plans are turning to narrower provider
networks and skimpier prescription drug coverage to keep
premiums and deductibles in check. Studies show that, compared
with typical employer-sponsored plans, Bronze and Silver
exchange plans include far fewer doctors, specialists, and
hospitals.
One of our witnesses today, Dr. Scott Gottlieb, in an
analysis comparing an exchange plan to a comparable private
health plan across several States found dramatically narrower
networks for critical specialties, such as cardiologists,
oncologists, and OB-GYNs, among others.
As CNN Money reported last October, quote, ``Many insurers
have opted to limit their selection of doctors in some exchange
plans to keep premiums and other costs down. And they are also
excluding large academic medical centers, which are often
pricier because they tackle sicker patients and more complex
cases,'' end quote.
This trend is particularly dangerous for those dealing with
serious diseases that may have to go out of network and,
therefore, bear significant cost to find a provider to meet
their unique needs.
Even those without serious illnesses have found that their
doctors they know and like are no longer participating in their
new exchange plans. A constituent from Conestoga, Pennsylvania,
wrote to me that, after her policy of nearly 30 years was
canceled last fall because it was not fully ACA-compliant, she
was unable to find a new exchange plan which included her
doctors in the network. Her OB-GYN, whom she had been seeing
since 1989, and her gastroenterologist are now out of network.
Narrower networks are not the only access problem consumers
are running into. And, again, in order to manage cost, some
plans are simply not covering the most cutting-edge, expensive
treatments and drugs in their formularies. Analysis shows that
even when expensive drugs are covered, patients in exchange
plans pay much higher cost-sharing for them than their
counterparts in traditional employer-sponsored plans.
It is this committee's job to understand the negative
consequences patients are facing under the Affordable Care Act.
And it is also incumbent for us to begin to examine this
problem and develop solutions to protect Americans being hurt
by the health care law.
I thank all of our witnesses for being here today. I look
forward to getting your perspective on the challenges patients
have and will face under the Affordable Care Act.
I will yield to Dr. Burgess.
Mr. Burgess. No, I think----
Mr. Pitts. OK. I yield back and now recognize the ranking
member of the subcommittee, Mr. Pallone, for 5 minutes.
[The prepared statement of Mr. Pitts follows:]
Prepared statement of Hon. Joseph R. Pitts
The President's health care law was sold to the American
people with a number of promises. If you like your plan, you
will be able to keep it; if you like your doctor, you will be
able to continuing seeing him or her.
Advocates of the law made this promise again and again. In
fact, President Obama, according to one count, made this
promise nearly 37 times.
Yet as we now know, this promise was simply not true. Last
year, millions of Americans had their health plans cancelled
and were forced to enroll in exchange plans.
Americans are also learning another sad truth. Health plans
offered in the exchanges are often not providing access--access
to the doctors, hospitals, and drugs they need.
Why is this occurring? As we will hear today, many of these
problems lie at the feet of the Affordable Care Act.
The ACA includes a number of benefits mandates imposed on
the plans consumers can buy. The law also adds hundreds of
billions of dollars in new taxes that are being passed on to
patients. This leaves insurers with only a few tools to control
and manage costs. As a result, many plans are turning to narrow
provider networks and skimpier prescription drug coverage to
keep premiums and deductibles in check.
Studies show that, compared with typical employer-sponsored
plans, bronze and silver exchange plans include far fewer
doctors, specialists, and hospitals.
One of our witnesses today, Dr. Scott Gottlieb, in an
analysis comparing an exchange plan to a comparable private
health plan across several States, found dramatically narrower
networks for critical specialties, such as cardiologists,
oncologists, and OB/GYNs, among others.
As CNN Money reported last October: ``Many insurers have
opted to limit their selection of doctors in some exchange
plans to keep premiums and other costs down. And they are also
excluding large academic medical centers, which are often
pricier because they tackle sicker patient and more complex
cases.''
This trend is particularly dangerous for those dealing with
serious diseases that may have to go out-of-network--and,
therefore bear significant cost--to find a provider to meet
their unique needs.
Even those without serious illnesses have found that the
doctors they know and like are no longer participating in their
new exchange plans.
A constituent from Conestoga, PA wrote to me that after her
policy of nearly 30 years was cancelled last fall because it
was not fully ACA-compliant, she was unable to find a new
exchange plan which included her doctors in its network. Her
OB-GYN, whom she had been seeing since 1989, and her
gastroenterologist are now out-of-network.
Narrower networks are not the only access problem consumers
are running into. Again, in order to manage costs, some plans
are simply not covering the most cutting-edge, expensive
treatments and drugs in their formularies.
Analysis shows that even when expensive drugs are covered,
patients in exchange plans pay much higher cost-sharing for
them than their counterparts in traditional employer-sponsored
plans.
It is this committee's job to understand the negative
consequences patients are facing under the Affordable Care Act.
It is also incumbent for us to begin to examine this problem
and develop solutions to protect Americans being hurt by the
President's health care law. I thank our witnesses for being
here today and look forward to getting your perspective on the
challenges patients have and will face under the ACA.
OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Pallone. As we prepare to have this conversation today,
there has to be some perspective. Republicans again will hammer
over and over again the same smears against the Affordable Care
Act that they have said year after year, and they will say the
President and the law have done no good for the country, but
the facts beg to differ.
So let's talk about how the law has led to the largest
expansion of health insurance coverage in decades. And I am not
just saying that; multiple independent surveys and analysis
have shown that, because of the ACA, millions more Americans
have health insurance coverage this year than they had last
year.
Here are some numbers: 8 million have private health
insurance through the ACA's new marketplace; 6 million more now
have Medicaid coverage; and millions more have purchased health
care outside the exchanges.
Mr. Chairman, Massachusetts' uninsured rate is down to
essentially zero percent because of the ACA. Minnesota's is
down by 40 percent. And my home State New Jersey's rate of
uninsured adults has dropped by nearly 40 percent, its lowest
level in nearly 25 years. And these are real numbers that
matter.
So if Republicans want to talk about how to ensure that
this coverage equates to better access, let's have that debate.
Let's talk about the ways in which we can strengthen the new
marketplaces. Let's talk about real solutions. Unfortunately,
the Republicans don't have any. They have no alternative plan
that can be put in place through the ACA that would result in
the same level of coverage for the millions of people who want
health insurance.
If you want to improve upon the law, that is fine. The
insurance industry just released a paper yesterday offering
ideas to improve the law. But where are the Republicans'
solutions? Do you want to guarantee broader doctor networks?
Great. Let's discuss the ways in which we can do that. Do you
want to mandate broader drug coverage? Wonderful. Let's talk
about the best approach to address that.
The law sets key basic standards and then gives States
flexibility to address these issues. In fact, we will hear from
one of the witnesses today about the flexibility. And so I ask
my Republican colleagues, do you want to preempt States?
Meanwhile, insurers, providers, and drug companies engage
in private contract negotiations every year to create benefit
packages. So are my Republican colleagues saying they would
like to interfere in those negotiations?
The truth is, the Republicans aren't saying anything except
let's go back to a system that gives companies free range
charge to whatever they want without any requirements to
actually take care of sick people or help them stay healthy.
We cannot and should not lose sight of the great strides
that this law has taken to get health insurance coverage to
people who never had it, who couldn't afford it, who were
denied it because they had preexisting conditions. Now,
millions of Americans have a health plan that ensures quality
coverage with guaranteed benefits and a premium placed on
prevention. This is a significant improvement in Americans'
access to health care.
So, Mr. Chairman, I am waiting to hear what is the
Republican plan to improve access, because the only so-called
solution I have seen out of the Grand Old Party is an effort to
repeal the law and leave 25 million more Americans uninsured.
If we want to improve the new insurance market, let's do so.
But, so far, I have not seen any serious effort by the
Republicans to improve health coverage for anyone.
I yield the remainder of my time to Mr. Green of Texas.
OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF TEXAS
Mr. Green. I thank Mr. Pallone for yielding.
The landmark health reform law has enabled 8 million
Americans to enroll in exchanges, 6 million to gain coverage
through Medicaid and CHIP, and Americans who already have
insurance can feel more secure in their coverage, ending some
of the worst abuses of insurance companies, providing key new
consumer protections and cost savings.
If you want something perfect, don't come to Congress. This
law is a result of compromise, and there are so many ways to
improve it. If the 24 States that so far refused to expand
Medicaid at very modest cost to the States and which was
largely offset by savings in cost of services for the
uninsured, millions more would be able to access health care.
The Affordable Care Act is so important to pivot from the
health-sick system to the true health care system. The law has
allowed the uninsured rate for Americans to drop to the lowest
level since Gallup and Healthways started tracking this data.
And I look forward to seeing it decline further and working
toward making improvements in this landmark law.
And, again, I thank my colleague for yielding.
Mr. Pitts. The Chair thanks the gentleman.
I now recognize the vice chairman of the subcommittee, Dr.
Burgess, 5 minutes for an opening statement.
OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF TEXAS
Mr. Burgess. Thank you, Mr. Chairman.
And thanks to our witnesses for being here with us today.
Thank you for holding this hearing.
Already been pointed out, we heard it time and time again
from the President: If you like your doctor, you can keep your
doctor, period; if you like your health plan, you can keep your
health plan, period. It sounded great on the stump but is
operationally not possible.
The Affordable Care Act cancels the policy that patients
wanted, mandates what they must buy instead, and this comes at
a cost. The Affordable Care Act overly constricts the health
insurance marketplace. It limits choice by imposing hundreds of
benefit mandates, leading to higher costs. States like
California have imposed even greater restrictions on choice. As
a result, they are facing some of the most limited networks and
highest out-of-pocket costs for prescription drugs in the
country.
Plans have been canceled. Plans sold on the health care
exchanges are leaving people functionally uninsured. Patients
are being subjected to higher and higher deductibles and other
out-of-pocket costs. They now lack critical access to their
doctors and vital prescription medication.
I am very familiar with these problems. I did not accept
the deal that was offered to Members of Congress in buying
health insurance. None of my constituents could do that. So
what I did was went into healthcare.gov and bought on the
individual market. My current plan now has a $6,000 deductible.
It does not cover medications that I had previously been
taking. And I am pretty lucky, I don't have to take many
things, but even with that narrow requirement, it could not be
met.
This law also negatively impacts those most in need of
care. For individuals who do have severe medical needs,
pediatric oncology patients, many of the Nation's leading
cancer centers and pediatric hospitals are not included in the
provider networks or the exchange plans, and access to
necessary specialty drugs often comes at a tremendous cost.
Analysts have found that the cost of just one dose of some
specialty medications could eat up to a third of an enrollee's
monthly income, even for so-called high-value plans with lower
cost-sharing.
Texas is home to some of the world's best medical centers.
The State's cancer centers and transplant centers--M.D.
Anderson, Baylor University Medical Center, Texas Children's
Hospital--treat patients from all over the country. Yet these
centers are generally included in less than half of the plans
that are offered in the Texas health insurance exchange.
There is also widespread physician uncertainty about
whether having existing contracts with insurers means that they
are already included in an exchange plan network. As a doctor,
I know this could lead to confusion both for the physician and
their patient. So another example of how the Affordable Care
Act hurts patients, hurts doctors, and is a strain on our
economy.
This committee should continue to hold the President to his
word and ensure that patients have the ability to keep their
doctor and their choice of insurance. The only way to do this
is to rescind or modify burdensome laws and regulations.
I yield the balance of the time to the gentleman from West
Virginia, Mr. McKinley.
OPENING STATEMENT OF HON. DAVID B. MCKINLEY, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF WEST VIRGINIA
Mr. McKinley. Thank you.
And thank you, Mr. Chairman, for holding this hearing on
the access to drugs and doctors under Obamacare and allowing me
to join the subcommittee today.
The issue of access to good medical care has become a
passion of mine. Since introducing the Patients' Access to
Treatments Act, I have heard from people all around the
country, about people that are not able to afford medication
that they need, even with private insurance, because of a
specialty tier.
Now we hear that under the Obama exchanges some plans are
not covering specialty and biologic medicines at all. This
loophole is blocking Americans with disabling diseases from
getting the necessary care that they need. This is
unacceptable.
I am looking forward to hearing from the witnesses this
morning on this issue that is extremely vital to the most
vulnerable citizens in our Nation.
And I yield back my time. Thank you.
Mr. Pitts. The Chair thanks the gentleman and now
recognizes the ranking member of the full committee, Mr.
Waxman, 5 minutes for an opening statement.
OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Waxman. Thank you, Mr. Chairman.
Today's hearing is about access to health care services in
the new health insurance marketplaces. The Affordable Care Act
is the single most important step forward on this issue in the
last 50 years. It will expand insurance coverage by over 25
million people, it ensures all plans offer real benefits, and
it bans discrimination on the basis of preexisting conditions.
Now, I know my Republican colleagues are in a constant
struggle to see who can be the most misleading and most opposed
to the ACA, but the premise of this hearing is a stretch even
for them.
Republicans are trying to claim that the benefit packages
and provider networks in ACA plans are actually limiting access
to care. But at the same time, they want to take us back to a
world where health plans are free to offer policies that do not
cover prescription drugs or hospitalization. They want to go
back to a world where a child with asthma can be turned down by
a health insurance company because of his or her preexisting
condition. Do they really think that would improve access?
If a father has a policy that doesn't cover prescription
drugs, what type of access does he have? If a mother has a
policy that does not cover hospitalizations, what type of
access does she have? And if a young girl is barred from
insurance because of a preexisting condition, what type of
access does she have? And if a working family is denied
Medicaid because their State won't take 100 percent Federal
dollars and expand coverage, what type of access do they have?
The answer is obvious: They have next to no access.
So I really can't take Republicans' criticism too seriously
today. What I do take seriously is the need for good provider
networks and robust benefit packages in the health insurance
marketplaces. That is why we wrote the first nationwide network
adequacy standard for the private insurance into the law. It is
why we ensured that prescription drugs were 1 of the 10
essential health benefits. And it is why we barred
discriminatory insurance benefit designs and included essential
community providers in all insurance networks.
Insurers' and providers' and drug companies' private
contractual negotiations have always been contentious, and
regulators have an important balance to strike between broad
access and affordability. These challenges are nothing new. As
enrollment and competition in the new marketplaces increase, I
am confident that we will see more choice and broader range of
benefit packages.
For example, in my own district, one of the most expensive
and best-regarded health systems in the Nation was not a major
participant in the marketplace last year, but after our State's
enrollment dramatically exceeded expectations, they announced
they will be in-network next year. That is private competition
at work.
As the law moves forward, Democrats will continue to work
to step up enforcement of plans that discriminate or improperly
limit access and will continue to work to expand choice and
improve the benefit packages offered in the marketplaces. And
we would welcome the Republicans joining us in trying to
accomplish that.
But if Republicans truly share these goals, while we are
eager to work with them, Mr. Chairman, what we will not do is
go back to the rampant discrimination and dangerous lack of
access that we had before reform. And that is what we would
have had if any of those votes that passed the House were taken
up and passed by the Senate and signed by the President to
repeal the Affordable Care Act.
This is a hearing that is all politics and very little
substance.
I yield back my time.
Mr. Pitts. The Chair thanks the gentleman.
That concludes the opening statements of the Members. The
written statements of all Members will be made part of the
record.
I would like to have a UC, seek unanimous consent, to
submit three items for the record: a letter from the
Association of Mature American Citizens; a sheet of the White
House Web site listing ``You Can Keep Your Own Insurance;'' and
a study by the Congressional Research Service entitled,
``Private Health Insurance Market Reforms in the Affordable
Care Act.''
[The information follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Pitts. We have one panel with three members today. I
will introduce them in the order they speak. First, Dr. Scott
Gottlieb, resident fellow of the American Enterprise Institute;
second, Dr. William Harvey, chair of the Government Affairs
Committee, American College of Rheumatology; and, finally, the
Honorable Monica Lindeen, commissioner of the Montana Office of
the Commissioner of Securities and Insurance.
Thank you for coming. Your written testimony will be made a
part of the record. You will each be given 5 minutes to
summarize. There is a little box of lights on the table, so
when you see the red light appear, we ask that you please
conclude.
At this point, Dr. Gottlieb, you are recognized for 5
minutes for your opening statement.
STATEMENTS OF SCOTT GOTTLIEB, RESIDENT FELLOW, AMERICAN
ENTERPRISE INSTITUTE; WILLIAM F. HARVEY, CHAIR, GOVERNMENT
AFFAIRS COMMITTEE, AMERICAN COLLEGE OF RHEUMATOLOGY; AND MONICA
LINDEEN, COMMISSIONER, SECURITIES AND INSURANCE, OFFICE OF THE
MONTANA STATE AUDITOR
STATEMENT OF SCOTT GOTTLIEB
Mr. Gottlieb. Chairman Pitts, Ranking Member Pallone, thank
you for the opportunity to testify today before the committee.
My name the Scott Gottlieb. I am a physician and resident
fellow at the American Enterprise Institute, and I previously
served at positions at the FDA and CMS.
Americans who sign up for insurance under the ACA are
finding many of these plans offer very narrow options when it
comes to their choice of doctors and drugs. Some argue these
narrow benefit designs aren't unique to the ACA, but this isn't
entirely true. The construction of the exchanges preordained
the wider adoption of these restrictive networks and
formularies and certainly made these constructs politically
suitable.
Since many plans have little or no coinsurance outside of
their networks and formularies, patients seeking care outside
of these arrangements can be saddled with the full cost of
these choices. Under many plans, when patients are out of their
networks or off their formularies, these costs don't count
against deductibles or out-of-pocket maximums.
To get a sense of how restrictive the formularies are and
its impact on patients, we looked at drugs used to treat two
chronic diseases: rheumatoid arthritis and multiple sclerosis.
We examined the drug coverage offered by the lowest-cost Silver
plan offered in the most populated county in 10 different
States and focused on disease-modifying drugs that are widely
prescribed for these patients.
We found that none of the plans provided coverage for all
the drugs or covered any of them without significant cost-
sharing that would tap out most people's annual deductibles and
out-of-pocket limits on spending. The challenge for consumers
is that most of the plans have closed formularies where
nonformulary drugs aren't covered at all. Moreover, the cap on
out-of-pocket spending only applies to costs incurred on drugs
included in a plan's formulary.
Among some of our findings, the multiple sclerosis drug
Aubagio is left off the formularies of 2 of 10 plans, so
patients on these plans could have to pay the full $4,400
monthly retail cost of the medicine, translating to about
$53,000 annually. The drug Avonex was left off the formularies
of 2 of the 10 plans, potentially saddling patients with the
drug's $4,800 monthly cost. That is $57,000 annually. Extavia
wasn't included on 2 of the 10 formularies, at a monthly cost
of $4,600 or $55,000 annually. Tecfidera was left off 6 of the
10 plans, at a monthly cost to patients of $5,200.
We found similar results when it came to drugs targeted to
rheumatoid arthritis. For example, the RA drug Xeljanz was left
off the formularies of 4 of the 10 plans, at a monthly cost to
patients of $2,400 or about $30,000 annually. Orencia was left
off two plans, at $2,600 a month or $32,000 annually. The RA
drug Remicade was left off the formulary of three plans, at
about $3,500 for a 2-month supply or $21,000 annually.
The high cost of developing innovative medicines translates
into high retail prices. This is a challenge for our health
care system. But the cost of disease progression and the
ensuing disability can far outweigh the cost of effective
management with some of these drugs. Many newer medicines are
more targeted to these diseases and far more effective.
These findings have been replicated by other analyses. One
study by Avalere Health of 22 carriers in 6 States found the
number of drugs available in formularies ranged from a low of
about 480 to nearly 1,100.
Even if your drug makes it onto the plan's formulary,
getting access can still be a costly affair. Another analysis
looked at 123 formularies from different Silver plans. More
than 20 percent required coinsurance of 40 percent or more for
the drugs for one of seven different chronic diseases, and
about 30 percent of plans provided no coverage for at least one
key drug for multiple sclerosis.
The same challenges are being seen when it comes to
networks of doctors that the health plans offer. More than two-
thirds of exchange plans have provider networks considered
narrow or ultra-narrow in which as many as 70 percent of local
health providers aren't included.
Earlier this year, we released our own analysis that
consistently found that exchange plans offer just a fraction of
the specialists available in the PPO plan offered by the same
carrier in the same region.
In the 1990s, consumers firmly rejected the idea of very
restrictive health plans and drug formularies when they spurned
HMOs in favor of preferred provider organizations. Yet, the ACA
seems premised on a view that consumers were making a bad trade
when they chose PPOs over HMOs. Each scheme has tradeoffs, but
the ACA all but codifies the HMO model into law, forcing
consumers into these restrictive arrangements as a way to pay
for the ACA's other rules and mandates.
Congress could reform the ACA by permitting any health plan
that previously met State eligibility prior to passage of the
law to be offered on the exchanges. This would allow for a much
wider selection of plans that make different tradeoffs between
benefit design and networks. These restricted schemes are an
unfortunate consequence of the way the ACA structured the State
exchanges. It is within Congress' power to fix these rules.
Thank you.
Mr. Pitts. The Chair thanks the gentleman.
[The prepared statement of Mr. Gottlieb follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Pitts. Dr. Harvey, you are recognized for 5 minutes for
an opening statement.
STATEMENT OF WILLIAM F. HARVEY
Mr. Harvey. Chairman Pitts, Ranking Member Pallone, thank
you for allowing me to speak before you today. My name is Dr.
Will Harvey, and I am a practicing rheumatologist at Tufts
Medical Center in Boston, Massachusetts.
In addition to my daily duties caring for patients with
rheumatic and musculoskeletal disease, I am privileged to chair
the Government Affairs Committee of the American College of
Rheumatology. As a member of the Coalition for Accessible
Treatments, the ACR advocates for, among other things,
affordable access to treatments for chronic conditions,
including rheumatoid arthritis, multiple sclerosis, lupus,
hemophilia, certain cancers, and many more. With these
treatments, much of the disability of these diseases may be
averted.
But a great tragedy is emerging in our country involving
increasing barriers accessing these treatments. Some of these
barriers include cuts to provider networks, step and fail-first
therapies, co-pay assistance problems, and specialty tiers. I
appreciate the opportunity to discuss some of those barriers in
more detail with you today.
The first barrier I wish to bring before the committee
relates to the practice of co-pays. I have no doubt every
member of this committee is familiar with co-pays and their
typical structure of generic tiers, name-brand preferred, and
name-brand nonpreferred, or Tiers 1 through 3.
Unfortunately, however, we are seeing more and more
insurers in plans and exchanges creating a fourth tier for
expensive specialty drugs. Data released this week from Avalere
shows that for many diseases, including rheumatoid arthritis,
100 percent of the biologic treatments fall within these
specialty tiers.
What is more alarming about this fourth tier is that the
insurers and plans in the exchanges have often assigned a
coinsurance on a percentage basis, ranging from 20 to 50
percent of the total cost of this drug, which, as you just
heard, can exceed $20,000 or more a year. This results in
patient facing thousands of dollars per year of out-of-pocket
costs.
Prior to the ACA, about 23 percent of plans included a
fourth tier. Based on this data from Avalere, 91 percent of
exchange plans use a fourth tier and 63 percent of them use a
coinsurance for that tier.
Because of the cost of coinsurance, many patients are
declining treatment. And, in many cases, when patients fail to
access these treatments, they become disabled and can no longer
remain in the workforce, thus costing the Federal Government
more money to cover disability. Arthritis remains one of the
top reasons for disability in the United States, at very high
cost to the Federal Government.
Here is a stark example sent to me from a colleague in
Wisconsin. ``I have a young mother,'' she tells me, ``with
rheumatoid arthritis who cannot afford biologic treatments
because of high co-pays. As a result, she has damage to her
joints, and my concern is that it will affect her ability to
remain employed. It has already limited the activities that she
can do with her children. I have many other stories,'' she
tells me, ``of patients who go without their medications, but
this patient is in her 30s, and I have watched her RA erode her
joints without being able to help her.''
Fortunately, 127 Members of Congress have charted a path
forward. H.R. 460, the Patients' Access to Treatments Act,
sponsored by Representatives McKinley and Capps, limits the
practice of Tier 4 pricing by preventing a percentage-based
approach in favor of pegging Tier 4 co-payments to lower tiers.
The ACR and the Coalition would like to thank Representatives
McKinley and Capps for their heroic leadership in this regard.
It has been noted that a potential consequence of such
action is an increase in premiums across all beneficiaries of
those plans. We commissioned Avalere to conduct an evidence-
based assessment of the likely impact of H.R. 460 on premiums.
The results indicated that, if passed, H.R. 460 would only
raise premiums in plans with specialty tiers by approximately
$3 per year, or 25 cents per month.
There is too much at stake for patients who might stay in
the workforce longer, avoid costlier treatments, and remain
productive members of our society to let this practice
continue.
Another issue I wish to bring before the committee relates
to changes in provider networks where insurers have attempted
to control costs by dramatically cutting provider networks. We
believe this has begun with Medicare Advantage plans across the
country, but there is great trepidation amongst all of my
colleagues that it will expand dramatically to plans within the
ACA.
In conclusion, I have great faith in the institution of
Government and that its members will do everything in their
power to protect the people of our Nation who suffer from
chronic diseases and are burdened with the growing expense of
treatments, with less access to the experts who can diagnosis
and treat their conditions.
I cannot leave without acknowledging that the ACA has had
successes and has been a benefit to many Americans. But the
health care system is far from fixed, and much work is still
necessary.
The committee should take swift action to, first, maintain
adequate provider networks to ensure access to care while
ensuring truth in advertising by requiring insurers in
exchanges and in the broader marketplace to disclose plan
changes to provider networks during open enrollment periods;
and, secondly, to prevent excessive cost-sharing by blameless
patients with chronic diseases by supporting H.R. 460, the
Patients' Access to Treatments Act, which would apply to any
private insurer within the ACA exchange.
Thank you again for accepting this testimony. I am happy to
address any questions the committee may have.
Mr. Pitts. The Chair thanks the gentleman.
[The prepared statement of Mr. Harvey follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Pitts. I now recognize Commission Lindeen, 5 minutes
for an opening statement.
STATEMENT OF MONICA J. LINDEEN
Ms. Lindeen. Good morning, Chairman Pitts, Ranking Member
Pallone, and members of the subcommittee. My name is Monica
Lindeen, and I am the commissioner of securities and insurance
for the State of Montana. And I also serve as president-elect
of the NAIC.
I appreciate the opportunity to appear before the committee
to discuss these two important topics that have a great
influence over the quality of care that QHP enrollees receive.
While I am limiting my spoken comments today to network
adequacy, my written testimony also contains information about
drug formularies.
As the ACA has been implemented, insurance commissioners
across the country have focused on protecting consumers and
markets in their individual States. The issues we deal with are
complex, but, through the NAIC, our national organization, we
have worked cooperatively to address the challenges.
Insurance companies have long used provider network
contracts as a way of controlling costs. Providers agree to
lower reimbursements in exchange for the increased traffic of
patients seeking lower out-of-pocket costs within the network.
But there can be problems. If the networks become too narrow,
patients can't get the services they really need. If the
regulation becomes too stiff, insurance companies can't
organize policies in ways that truly cut health care costs.
These concerns have been ongoing for some time, and network
adequacy oversight has been and will continue to be a priority
for insurance commissioners around the country.
Given the importance of striking a balance, particularly
with respect to tradeoffs between breadths of network and cost
and the differences in local geography, demographics, patterns
of care, and market conditions, it is important that
responsibility for assessing the adequacy of networks remain
with the States. State-based regulation works and has proven to
effectively protect consumers. Networks are inherently local,
and you need local expertise to effectively regulate the
markets and preserve patient access to the care they need.
Montana has the tools in place to adequately regulate in-
networks, and our network adequacy standards are, in general,
more protective than what the ACA requires. My staff reviews
the network adequacy of every health plan approved for sale
inside the Federal exchange as well as those sold outside the
marketplace. Because I conduct the same review inside and
outside, I am able to ensure a level playing field in our
market.
In Montana, we have not witnessed the sale of private
health insurance plans restricted to certain service areas and
the very narrow networks do not really exist. The majority of
the health plan products offered in Montana are a variation of
a PPO product. However, in 2014, two of our three marketplace
insurers did offer a narrower network option in two cities. But
both of those companies also offered products in all parts of
the State with access to their complete network, including the
rural areas.
It is very important for consumers to understand the
network features of a plan and how those apply to care provided
by specific providers. Most of the network adequacy complaints
received by my office this past year were rooted in a lack of
transparency about available providers and a lack of
understanding about how network restrictions work. Consumers
found it difficult to find lists of provider networks when they
were shopping for insurance, and this made it very difficult to
choose the correct plan. The marketplace and insurance
companies need to do better job of providing accurate and easy-
to-access network lists.
These are not insurmountable problems, and States are
focused on fixing these transparency issues. Over the years,
insurers have been experimenting with new types of plan
designs, and the head-to-head competition on exchanges has
accelerated this trend, as competition on prices become more
acute.
While I and my colleagues agree that containing cost and
bending the curve is critically important, we must also
remember that health care is about more than the bottom line.
Some older State statutes may no longer fully accommodate these
new plan designs, and so the NAIC has begun working to revise
our network adequacy model law, which aims to fully protect
consumers while providing regulatory flexibility.
We have spent the last month receiving input from all
interested stakeholders before drafting any revisions, which we
hope to develop and consider through our open and transparent
process and complete by the end of the year. Until that time,
we believe CMS should not engage in further rulemaking until
the States have time to act.
As I conclude my remarks, let me leave you with this
perspective from someone who has been on the ground dealing
with implementation. I have traveled across the entire State of
Montana in many communities, including all seven of our Indian
reservations, a distance greater than from here in DC to
Chicago. And even on our Indian reservations, whether they are
Republicans or Democrats, the folks in Montana don't want to
talk about partisan arguments; they want to talk about
solutions that are going to help them find their correct doctor
and their correct insurance plan and get the care they need for
their families. Trying to help answer those questions is what
drives my decisions as a commissioner, not what is happening
here in DC.
So thank you for the opportunity to testify.
Mr. Pitts. The Chair thanks the gentlelady.
[The prepared statement of Ms. Lindeen follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Pitts. That concludes the opening statements of the
witnesses. We will now go to questions and answers. I will
begin the questioning and recognize myself for 5 minutes.
At the outset, I want to point out one thing I find deeply
troubling. It is now widely acknowledged that the President's
promise that if you like your doctor you can keep your doctor
under the Affordable Care Act is simply not true for many
patients around the country. Given this fact, I think it is
unacceptable that the administration continues to give
Americans the false impression that this promise is somehow
true.
To this day, the White House Web site includes a section
entitled ``Health Insurance Reform Reality Check.'' And on the
Web site, the promise appears, ``If you like your doctor, you
can keep your doctor.'' The Americans don't expect their
elected leaders to agree with them on everything, but they do
expect and deserve the truth. So I would urge the White House
to either take this page down from their Web site or correct
the record immediately.
Dr. Gottlieb, many patients with coverage through the ACA's
health care exchanges are sadly finding out that they may not
have real access to their doctor or medicines that they rely on
because of narrower networks, restrictive drug formularies, or
a complete lack of coverage for a specific provider or drug.
Can you further explain how these patient access issues are
being driven by the design of the President's health care law?
Mr. Gottlieb. Well, I think it was a combination of things.
The first thing was the costly mandates that the law imposed on
what the plans needed to cover, things like mental-health
parity, first-dollar coverage for a lot of preventative
services. There is no question there are going to be consumers
who benefit from those mandated benefits, and I am not debating
the merits of that, but they are expensive.
Coupled with that, the law outlawed or restricted a lot of
the traditional tools that insurance companies used to control
costs. And things like underwriting risk, things like using co-
pays to steer patients aggressively, adjusting premiums--and so
what they were left with was the ability to go after the
networks and go after the formularies. And since that was the
only tool they had left to try to adjust the plans to meet the
cost requirements in an environment where they had a lot of
mandates imposed on them, they went after them very
aggressively.
There were a lot of folks, prior to passage of ACA, in this
town, smart folks on both the right and left, who knew that the
networks were going to be narrow in these plans and anticipated
that and saw it as a--you know, proponents of the law saw it as
a necessary compromise to accommodate the mandates. But I think
that, in fact, was the reality of what happened.
Mr. Pitts. Dr. Harvey, in your testimony, you note a study
from Avalere showing a dramatic expansion in the use of
specialty tiers for prescription drugs in exchange plans
relative to coverage before the ACA.
Can you elaborate a little more on how this trend has grown
and what it means for the patients you serve?
Mr. Harvey. Certainly.
It has grown dramatically. It seems to have started, to
some extent, in the Medicare Advantage plans but has, as you
noted, become much more common in the ACA exchange plans.
The impact on patients is profound. Every day, in my
practice, I see patients who tell me they cannot afford their
medications because of this expensive co-pay. And it is a
tragedy, as Congressman McKinley said, unacceptable, that in
this country we can have the tools to prevent disability
without them being affordable to patients.
Mr. Pitts. Commissioner Lindeen, at the beginning of your
written testimony, you state that the President's health care
law, quote, ``has probably accelerated the trend,'' end quote,
toward narrower networks for patients in the individual and
small-group market because the law limits underwriting by
insurers.
Are there other benefit requirements in the ACA that you
believe could be contributing to the trend of narrow networks?
Are there other requirements--for example, the requirement that
consumers buy coverage that includes essential health benefits
and that meet minimum actuarial value?
Ms. Lindeen. Thank you for the question.
You know, network adequacies and the narrowing of those
networks is really nothing new. This has been going on for
years, and I think that, obviously, the ACA has accelerated
that process.
And it is market competition at work that is occurring,
literally. And while the head-to-head competition in the
exchanges are accelerating that trend of narrow networks, it
can also be a very effective way of actually reducing the cost
of health care. But that doesn't have to, you know, reduce the
amount of quality also. And that is why it is really important
that we are regulating these networks and making sure that we
are not compromising quality.
We also know that, you know, as they are working on these
contracts, that they are actually going to--just to the
marketplace. We have already gotten a lot of companies who have
talked about the fact that they are getting more contracts in
place for this coming year. And so I think that we are going
to--they are responding to what they are hearing from patients
and responding to what they are hearing from you folks, as
well. So we are going to see this continue to change and
improve for the consumer.
Mr. Pitts. The Chair thanks the gentlelady.
I now recognize the ranking member, Mr. Pallone, 5 minutes
for questions.
Mr. Pallone. Thank you, Mr. Chairman.
I do have this--I ask unanimous consent to include this
written statement for the record from Claire McAndrew from
Families USA.
Mr. Pitts. Without objection, so ordered.
[The information follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Pallone. Thank you.
As I said in my opening statement, if Republicans were
serious about improving health care access, I would be very
pleased that we are having this hearing. The ACA takes
unprecedented steps to expand access to health care services,
but I agree that if any American lacks access to the care they
need, we have more work to do.
But I can't sit idly by and listen to Republicans claim
they want to expand health care access and then in the same
breath claim that they want to repeal the ACA. I think that is
just ridiculous.
So, Commissioner Lindeen, the ACA has led to dramatic
increases in health insurance coverage. It has opened up
affordable coverage to millions who were previously priced out
because of preexisting conditions. Over the next few years, it
is projected to reduce the number of uninsured Americans by 26
million.
Can you help us get some clarity on a simple point? Does
having health insurance increase people's access to health care
services? Or put another way, would the 25 million Americans
getting covered because of the ACA have better access if the
Republicans got their way and they became uninsured?
Ms. Lindeen. Congressman, thank you.
Let me just say this, that in my experience as the
insurance commissioner in Montana and having had the
conversations that I have had with thousands and thousands of
folks across my State, there has been an increase in coverage
for Montanans. And I am certain that that probably is happening
in every State.
And I can also guarantee you that there are folks who
didn't have coverage previously that have it now. There was one
woman I know of, for instance, in Montana who was born with
this heart condition and so she had never had insurance in her
life because, number one, she couldn't afford it and because of
the preexisting condition. She had incredible expenses
throughout her life as a result, and then her husband passed
away, and she had more of a burden on her in terms of finances.
And then she was diagnosed with uterine cancer. She made the
decision to actually forego any treatment because she knew that
it was going to bankrupt her and her family. I mean, that is a
tough decision to make.
Well, as it turned out, the ACA passed about the same time
that this occurred, and, as a result, she was actually able to
get for the first time in her life access to care that she
could afford and is alive today.
And I think that is what we need to remember, is that this
is really life and death to many, many people across this
country. This is about making sure that they are taking care of
themselves and their families.
And really, frankly, the public is tired of hearing the
arguments in Congress. What they want is for us, and for all of
us, to solve the issues. And I can tell you that insurance
commissioners across this country in every single State, who
are Republicans and Democrats, put aside their partisan beliefs
every day to try to do what is best for their consumers. And
all we ask is that you folks do the same.
Mr. Pallone. I appreciate that. Thank you. And as I have
said, if Republicans are serious about improving the ACA to
expand access, then I am eager to work with them.
But the ACA includes unprecedented nationwide network
adequacy requirements; it requires plans contract with
essential community providers that work in underserved
communities and offer key services; it bars plans from imposing
extra cost-sharing on out-of-network emergency care; and it
requires plans to cover essential health benefits, which means
that they must have a range of providers in-network.
So I just wanted to ask you, Commissioner, States have a
great deal of flexibility in setting their own standards and
enforcing those requirements; isn't that correct?
Ms. Lindeen. Yes, they do. We in our States have always had
a great deal of ability to set standards. Obviously, we feel
like the ACA, in many cases, set a floor and then we can then
go above that floor if necessary.
You know, in terms of--and if I could, in terms of the
essential health benefits, you know, insurance is really about
spreading risk. OK? And it is important for things like
maternity coverage to be included in order to help spread that
risk. Because if you don't, what happens then is you have folks
who can't even afford to get coverage for maternity care, which
was happening in some States prior to the Affordable Care Act.
Montana is an exception to the rule. We have had unisex
insurance law on our books for over 20 years, and so we have
been spreading the cost all this time. And, as a result, every
woman in the State of Montana has had the ability to have that
kind of care, and affordable care, in order to have coverage
for pregnancy.
Mr. Pallone. All right. Thanks so much.
Mr. Pitts. The Chair thanks the gentleman and now
recognizes the vice chair of the full committee, Ms. Blackburn,
5 minutes for questions.
Mrs. Blackburn. Thank you, Mr. Chairman. And I am delighted
we are having the hearing today and having this discussion.
I find it so interesting that my colleagues across the
aisle continue to say we have no options to replace Obamacare
because, indeed, we do. Indeed, Mr. Scalise and Dr. Roe and I
wrote the President on December 10th of last year asking if we
could come and discuss with him the American Health Care Reform
Act, which would be a replacement. It includes such popular
ideas as across-State-line purchase of health insurance,
portability, equalizing tax treatment, looking at tort reform.
So we have plenty of options. What we need is people who
are willing to listen that there just might be a better way to
administer health care than going through a Government-run
program.
Now, when we talk about repealing Obamacare, we are talking
about getting rid of Government control of health care. The
reason we do this is because history tells us and what we see
playing out in front of us shows us it does not work. Look at
what is happening with the VA.
And, of course, we all know from some of the Democrat
leadership that the stated goal of Obamacare is to have it push
us to a single-payer system.
So, with that in mind, I would just say--and, Commissioner,
to you, thank you for joining us, but I have to tell you, in
Tennessee, we had an experiment with Hillarycare, the test case
for Hillarycare, which became the template for Obamacare. Now,
ours was called TennCare. And what we saw is it was an
expensive--far too expensive to afford. It was consuming every
new dollar that came into our State.
So what did a Democrat Governor do? And putting aside his
partisanship, what he did was to take the program down to--took
several hundred thousand people off the program because we
could not afford this. It became 35.3 percent of the State
budget.
We know it does not work. Access to the queue and access to
the care is not the same thing.
I heard from a woman who had Obamacare. She was excited to
get it. She went to her primary care physician, thought she had
all these essential benefits. Needs a test, goes over to the
medical lab. Guess what? Doesn't pay for the test. Guess what?
She didn't have $1,200 to pay for it. So, see, access to the
queue and access to the care are a couple of different things.
I have heard from an eye surgeon over at Vanderbilt, and he
has a surgery that deals with blindness for those that have
diabetes. He is looking at narrowing networks for Medicare and
incredibly narrow networks, the process not even covered
through Obamacare. And so we are seeing this problem with
access to the care that is needed.
And I have to tell you, after living through the issues
with TennCare in my State, I think it is just awful that we
would give false hopes and false promise to people that really
want to access health care and have that available for their
families.
And that is what we are seeing play out with Obamacare.
That is why you continue to have waivers. It is why you
continue to have people seeking to opt out. It is why the
administration continues to go around Congress and give
different parts of the law different treatment. Not supposed to
do that, but they do it anyway because they are dealing with
the program that doesn't work.
Dr. Gottlieb, let me come to you. I am so concerned about
these narrowing networks and what we saw in TennCare, what we
have seen in Medicare with the narrowing network, such as what
I mentioned with the eye surgeon there in my district. And I
would like to know your thoughts on if you believe that the
same central cost-controlling behaviors are going to happen as
we move forward with Obamacare and why you think that is going
to happen and the effect that is going to have on access to
specialty care.
Mr. Gottlieb. Well, it is happening, and it is happening
because I think it is one of the primary cost-control tools
that the insurance companies have left to them under the
existing rules.
I also think that the compromises that were made in the
Affordable Care Act made this politically palatable, if not
fashionable, to have these kinds of networks. If we think back
to the 1990s, the last time there was a broad movement towards
more restrictive kinds of plans, the HMO-style plans, we saw
introduction of the patients' bill of rights and a real
political backlash. I think that the environment now prevents
that backlash from happening, and so you are going to see more
insurance companies take advantage of these tools.
And I fully expect that you are going to see these narrow
networks start to roll out into other aspects of the market--
the commercial market, the Medicare Advantage market. This
isn't going to just be confined to the Affordable Care Act
marketplace.
Mrs. Blackburn. I yield back.
Mr. Pitts. The gentlelady's time has expired.
The Chair recognizes the gentlelady from Virgin Islands,
Dr. Christensen, 5 minutes.
Mrs. Christensen. Thank you, Mr. Chair.
And I have to agree with Dr. Lindeen that it is time to
stop arguing and just, you know, move ahead. Too many people
are benefiting right now from the Affordable Care Act, and,
yes, there might be things that we could tweak a little bit,
and we have always been willing to do that, but it is time to
stop the arguing and take care of the needs of the American
people.
The Affordable Care Act is a very important step towards
eliminating health disparities. Minorities are far more likely
to lack insurance, far more likely to lack access to a regular
source of care, less likely to receive key preventative
benefits. The ACA's coverage expansion and its focus on
prevention is already having a huge impact, positive impact, on
minority communities.
Provider networks and prescription drug coverage are key to
this impact. The law's requirement that all health plans
contract with essential community providers that work with the
underserved population is critically important. And I am hoping
that, you know, some of the doctors that I have worked with in
the National Medical Association and the Hispanic Medical
Association are being seen as essential community providers in
these networks.
The essential health benefits and cost-sharing protections
are huge steps forward to make sure necessary treatments are
available and affordable to the newly insured. Commissioner
Lindeen, how do these provisions and other aspects of the ACA
help the underserved communities in your State?
Ms. Lindeen. I appreciate the question.
You know, we have a very rural State, as you can imagine,
and a large proportion of the population actually falls in that
area of low-income, including seven Indian reservations, where
there is, you know----
Mrs. Christensen. Yes.
Ms. Lindeen [continuing]. Obviously, limited employment
opportunities.
And I can tell you that I had a study commissioned by an
independent group with, actually, one of the grants as a result
of the ACA. I guess it has been almost 4 years ago now. And we,
through that process, were able to come up with a number of
about 170,000 Montanans who were not only uninsured but
actually fell into, in many cases, these--the same type of--
were the same type of people that you are talking about.
As a result of the ACA and the new marketplace, I can tell
you that, in this first enrollment period, we have been able to
get coverage for a good number of them, tens of thousands of
that 170,000.
Unfortunately, about 70,000 of those individuals still fall
into that Medicaid gap. We have not expanded Medicaid in the
State of Montana. And so it is kind of a difficult situation we
find ourselves in, where, you know, these 70,000 folks, at
least in my State, really have no option--affordable option. I
mean, they are the working poor.
Mrs. Christensen. Yes.
Ms. Lindeen. But we have seen, definitely, thousands of
folks who have been able to get access as a result.
Mrs. Christensen. Yes. If we could have all of the States
expand Medicaid, we would cover probably 95 percent of the
people--of minorities and the poor. So we continue to work and
hope that the States will accept Medicaid expansion that have
not thus far.
But these are important steps forward. We all need to
remain vigilant to make sure that the law is implemented so
that it achieves the goals of eliminating health disparities.
For example, the law bans insurers from designing their health
plans in a discriminatory manner. They cannot set up drug
formularies or choose their providers in a way that
discriminates against any group or individual with serious
health needs.
Commissioner, how are you looking at potential
discrimination in the marketplace? And how should we think
about this issue going forward?
Ms. Lindeen. Well, I would say that, I mean, I think it is
a really important issue that I think every one of the
commissioners is very concerned about.
Obviously--let's just talk about the tiered drug
formularies for a second. I mean, it has really proven to be
effective in terms of helping to bring down costs and really
steer consumers toward generic drugs. But, at the same time, we
are also, you know, wary of the fact that we want to ensure
that these are being structured in a way that do not keep
patients that have these certain medical conditions from
actually accessing their drugs. That is in violation of the
ACA, it is in violation of State laws.
And so, if there are any nondiscrimination--or any
discrimination occurring, I mean, we will actually investigate
that and take measures to make sure that that doesn't occur in
the future.
Mrs. Christensen. Thank you.
Mr. Pitts. The gentlelady's time has expired.
The Chair recognizes the vice chair of the subcommittee,
Dr. Burgess, for 5 minutes of questioning.
Mr. Burgess. Thank you, Mr. Chairman.
Dr. Gottlieb, again, thank you for being at our committee.
You are always good to respond when we request, and we
appreciate it.
An article that was published in Forbes in December, it's
titled, ``No, you can't keep your drugs either,'' are you
familiar with that article?
Mr. Gottlieb. Yes.
Mr. Burgess. Well, in the article--I mean, I have got to
tell you a lot of people are not familiar with what a formulary
is or what a formulary does, but I suspect even more are not
familiar with what a closed formulary is or does.
Could you tell us in a few words what that is?
Mr. Gottlieb. Well, a lot of these formularies are closed
formularies, particularly when you look at the Bronze and the
Silver Plans.
And what it basically means in most cases is that, if a
drug isn't on the list of the plan's formulary, it is not
covered at all, there is no co-insurance, and whatever you
would spend on purchasing the drug wouldn't count against your
out-of-pocket limits or your deductible.
Mr. Burgess. And that, you know, is such a key point.
Again, as I referenced in my opening statement, I bumped up
against this myself, not with something that was terribly
esoteric.
But at the same time I thought, ``Well, I am a free
American. I will just buy the darn drug myself, but I will
charge it against my deductible.'' And I was informed that
that--you know, ``You are just spending your money. You are not
covering your deductible.''
Now, of course, the out-of-pocket limits were suspended the
first year in the individual market for individuals under one
of the President's unilateral decisions on enforcement activity
under the Affordable Care Act. So that really doesn't even
play.
But the concept of a closed formulary is one that I don't
think people are aware of. They need to become aware of it.
And, again, like me, they may bump up against it without
knowing that that restriction actually exists.
Mr. Gottlieb. I will just add it is very hard to figure
out. When we looked at these plans, we had a very difficult
time figuring out if these were closed formularies or not. We
spent days on it. And I had a very talented research assistant
working with me and we had to actually call the plan and even
then it was difficult to get that information. So consumers
might not know until it is too late whether they are in one of
these.
Mr. Burgess. Correct. It is too late because they are
already into their coverage year. Presumably, they could change
plans next year.
But, unfortunately, we don't know whether there will be
access to plans that will not--I mean, I think closed
formularies are here to stay. I mean, I think it is just one of
those things.
I practiced in the 1990s. I remember what it was like with
HMOs. But a lot of those practices, even though they have been
modified and mitigated with time, they are still with us.
You are still calling a 1-800 number to get approval for
your patient who doesn't--if you don't follow the step therapy
for asthma, for example. You have got to do it exactly the way
the insurance company says or the product is not covered.
Another piece that I have here of yours is also from
Forbes, and this one was published in March, so just a few
weeks ago: Hard Data on Trouble You Will Have Finding Doctors
in the Affordable Care Act. And then you have a table.
That is some pretty striking information that you revealed
there as well. I mean, again, we go back to, if you like your
doctor, you can keep your doctor, unless your doctor happens to
be a cardiologist in Connecticut, for example, where 177 of the
400 cardiologists are no longer available to you.
Have I interpreted that correctly?
Mr. Gottlieb. You have. And the other thing--you know, we
talk about the sort of popularization of the closed
formularies.
The other thing that I think is going to be popularized is
something called the exclusive provider organization, which
might be a new acronym for a lot of folks, where you are
dealing with a network of physicians that literally are
countywide.
And once you go outside your network, again, if you are in
a closed network, whatever you spend with a physician outside
that network won't count against your out-of-pocket limits,
potentially
Mr. Burgess. And, you know, I am just like anybody else.
When I went and priced this stuff on healthcare.gov--or when I
went and shopped on healthcare.gov, I was only shopping on
price.
I think that is what most people do, not anticipating they
are ever really going to need their health insurance. But the
reality is you can get some serious restrictions and some
boundaries on the type of medical care you are able to get
under these policies.
Ms. Lindeen, let me ask you a question, and this is a
little bit off topic. But since you are the insurance
commissioner on the panel, we are all familiar with medical
loss ratio and the fact that any insurance company can only
have 15 percent of its expenses on the administrative side.
What happens when an insurance company buys a doctor group?
Do those administrative costs then just get automatically
transferred to the clinical side because a doctor group has
been purchased now by a health plan?
Ms. Lindeen. I have to tell you that I am not an expert on
how that works, but I would be definitely willing to go back
and get you that information.
Mr. Burgess. I think that is something we are likely to see
more and more of. I think it is a loophole, if you will, in the
way the--one of the many loopholes in the way the law was
drafted. But I would appreciate your researching that and
getting back to the committee on that issue.
Ms. Lindeen. Absolutely. It is my pleasure.
Mr. Burgess. Thank you.
I yield back, Mr. Chairman.
Mr. Pitts. The Chair thanks the gentleman.
Now recognize the gentleman from Texas, Mr. Green, for 5
minutes of questions.
Mr. Green. Thank you, Mr. Chairman, Ranking Member. I
appreciate you having the hearing today.
I want to start by saying, while health insurance does not
necessarily equal health care access, having coverage, whether
it is through the employer, Medicare, Medicaid, CHIP, or
exchanges, the essential first step is to have access to health
care.
And I was a State legislator for 20 years--I tell people
before I lost my mind and came to Congress--in Texas and worked
on access and worked on expansion of Medicaid when we had to
come up with a third of the money for Medicaid in Texas. Under
the Affordable Care Act, it would be 100 percent for a few
years and no more than 10 percent.
So I understand--but my first question is if the witnesses
could give us some specific changes or reforms in the
Affordable Care Act, or Obamacare, if you will send them to the
committee, things that you would see that--something we could
do, because, hopefully, we will get to that point some day in
our committee, saying, ``What can we do to make it better?''
My frustration is that, in Texas, we didn't expand
Medicaid. If we had, 92 percent of all eligible uninsured
Texans, or 4.5 million, would qualify for premium tax credits,
Medicaid or the CHIP program.
Commissioner Lindeen, some of my colleagues make the
argument that having Medicaid coverage is worse than being
uninsured. What do you say to that? Have you heard that having
Medicaid coverage is worse than being uninsured?
Ms. Lindeen. No. I have not heard that. I am just being
honest. Honestly, I have not.
Mr. Green. OK. What would be your response to it? You know,
granted, Medicaid is not a major plan, but it still gives
access to a health care system.
Ms. Lindeen. Yes. I mean, I would argue that, if you talk
to somebody who actually is uninsured and does not have access
to Medicaid, who is in that gap and who has some serious health
needs, I would definitely ask them that question.
Mr. Green. It is estimated that States' unwillingness to--
or inability to expand Medicaid is leaving 5 million uninsured
who could otherwise have coverage.
What would Medicaid expansion mean to families and the
uninsured in your State?
Ms. Lindeen. Well, it would mean the world. I mean,
obviously, medical bills are one of the number one reasons for
bankruptcy.
And I can tell you that those folks who fall in that gap,
if they find themselves in the situation where they are going
to have to try to get care and it is going to be expenses that
they can't afford, I mean, that is where they are going to end
up. They are going to end up bankrupt.
Mr. Green. Well, I don't have a wealthy district.
Ms. Lindeen. I don't either.
Mr. Green. In study after study, Medicaid has been shown to
improve access, increase individuals' reported health, and
provide significant financial security.
A recent study even demonstrated that Medicaid coverage can
improve educational advancement in helping lift people up the
economic ladder.
And I have to admit, even in Houston, Texas, the Greater
Houston Partnership was our main chamber of commerce. They
encouraged our State legislature during the last session to
expand Medicaid.
Hopefully, when the legislature goes in session in January,
they will realize that, you know, that is the cheapest way we
can cover folks in Texas.
Because in Texas--in the military, they would call it a
target-rich environment. We have the highest percentage of
uninsured. We also have the highest number of uninsured.
So Medicaid expansion would help for those qualified for
Medicaid, but it would also allow, like you said, for those
near-poor Medicaid to be qualified under the Affordable Care
Act for the subsidies.
And, of course, Medicaid expansion is funded by the Federal
Government and, like you said, most Medicaid is two-thirds
Federal funding, a third State funding, although each State has
a different percentage, as I found out. Many States are seeing
a big influx in funds and are likely to save money over the
long term.
Commissioner, when you look at the total picture, is
Medicaid expansion worthwhile for States like yours?
Ms. Lindeen. I can tell you that we also commissioned an
independent study to look at the effect of Medicaid expansion
on the State of Montana, and the positive economic impact to
the State was incredible in terms of the hundreds of millions
of dollars that it would bring into the State, as well as the
thousands of jobs it would create, not only just any kind of
job, but good-paying jobs, mostly in the medical community.
We, too, had obviously legislation that came before our
legislature this past year, and I was amazed at the folks who
came and testified in favor. It wasn't just the hospitals and
the providers, but it was business people.
We had one gentleman who works for an investment company
who came in front of the legislature and said, ``Listen, if I
was a Fortune 500 company standing before you today and saying
that, if you were to accept these Federal dollars and it was
going to help create all these jobs for my company and my
company would come to your State as a result, you would fall
all over yourselves to pass it.'' But because it is not a
Fortune 500 company, they refused.
Mr. Green. Thank you, Mr. Chairman.
Mr. Pitts. The Chair thanks the gentleman and now recognize
the gentleman from Illinois, Mr. Shimkus, for 5 minutes of
questions.
Mr. Shimkus. Thank you very much.
Great to have the panel.
And, Commissioner, just--it is our job to do oversight. So
preaching the partisan aspects of Washington, DC, we need to
continue to do oversight on this law, and that is our job. So I
just put that on the table because I have a problem with your
tone.
Having said that, what is the population of the State of
Montana?
Ms. Lindeen. First of all, let me apologize if my tone----
Mr. Shimkus. No. That's fine. I am running out of time. I
only have 5 minutes. So----
Ms. Lindeen. About a million people.
Mr. Shimkus. And in your testimony you mentioned that the
ACA is sharpening the competition between insurers.
Can you tell us how many insurers are in the State of
Montana.
Ms. Lindeen. Well, we have hundreds of insurers licensed to
do business. But in terms of the numbers that are in the
marketplace--the new Federal marketplace, we had three this
year.
Mr. Shimkus. Three.
Ms. Lindeen. I know we had one more----
Mr. Shimkus. So some of us would question whether that is
vibrant competition. Three is better than two. Two is better
than one. We would rather have more versus less and a vibrant
market that has a lot of choices for the consumer.
Let me go to another question to the panel as a whole.
Recent stories indicate that emergency room access is
increasing. Why do we think that is?
If we pass a national health care law which is supposed to
provide people health care coverage to access primary care
doctors, internists, and to make sure that hospitals aren't--ER
rooms are not being overutilized, why is there an increase in
emergency room usage?
Mr. Harvey. So my wife is an emergency room physician. So
we have a lot of dinner table conversations about this.
I think a couple of issues. One is that people who are now
covered--or who believe they have coverage don't necessarily
understand the fact that treatment in an emergency room comes
at much greater cost than treatment in other settings.
Secondly----
Mr. Shimkus. But if they have got care, why are they going
to the emergency room?
Mr. Harvey. Well, I think the second point is that there
are access issues to physicians not because of any coverage,
per se, but because there is a shortage of primary care in
particular, but many specialty physicians as well, that has
been uncovered by the fact that there are many more people now
with coverage demanding the services.
Mr. Shimkus. Could the--Dr. Gottlieb?
Mr. Gottlieb. I was just going to say I practice at a
hospital. So I admit from the emergency room. I think a couple
of things that I would just point out.
The first is that coverage doesn't necessarily equal access
and coverage doesn't change whether or not a person is a good
consumer of health care services.
And what you typically see--or often see is someone will
get coverage. They will be newly on Medicaid or Medicare or
private coverage and their patterns won't change at all as a
result of the coverage. So just giving someone health care
coverage really doesn't guarantee that they are going to get
care.
And the other thing is that a lot of folks end up in
schemes where they are underinsured. And so they still don't
have access to doctors who return phone calls after hours, the
ability to schedule appointments the day of when a problem
arises. And so they still end up in the emergency room.
That is typically what I see when I see newly insured
people who are ending up in the emergency room even though they
have insurance for the first time.
Mr. Shimkus. Is there a co-pay with a lot of these plans, a
high co-pay----
Mr. Gottlieb. A deductible issue.
Mr. Shimkus. The deductible. That is what I mean. The
deductible is at. They can't afford the deductible.
Let me ask another question. Is emergency room care more
expensive or less expensive than going to a urgent care or a
primary care doctor?
Mr. Gottlieb. Well, it is far more expensive and it is far
less efficient.
Mr. Shimkus. And everybody would agree that. Right?
Even, Commissioner, you would agree with that.
Is this driving up the cost of health care or lowering the
cost of health care, this issue about emergency room usage?
Mr. Gottlieb. Well, we are going to see health care costs
go up if we see more people end up in emergency rooms. There is
no question about that. We need to do more to try to make care
accessible to people and not just hand them an insurance card.
Mr. Shimkus. Thank you.
And my time is expiring. And I will just end on this.
My friends tout 8 million have signed up, actually,
Medicaid expansion. I always say there is a sliver of people
that have been helped, but I will tell you there have been more
people harmed by paying more in their health insurance and
getting less coverage.
The Wall Street Journal has said 10 million people have
lost their insurance. Part of that 8 million or 10 million who
have lost their insurance and--have to buy new insurance, just
like us. We had insurance coverage.
So when you count how many have been added to the insurance
roles, you better make sure you are counting the people that
have lost their insurance under this new law.
And I yield back my time.
Mrs. Ellmers [presiding]. The gentleman yields back.
The Chair now recognizes Ms. Castor from Florida.
Ms. Castor. Well, thank you very much.
I want to thank the chairman and the ranking member for
organizing this hearing on access to health care.
I don't think anyone can ignore the fact now that the
Affordable Care Act has been the largest expansion for families
across America and their access to the doctor's office in our
lifetime.
And in the State of Florida, it was very surprising. We had
a very high rate of uninsured, and we thought, gosh, we are
going through all these political fights with what the ACA
means. And, in the end, I think these families spoke very
loudly.
We thought we would maybe have 500,000 sign up on the
Federal exchange or 600,000 would be really great. We had about
a million Floridians sign up on the Federal exchange. That is
the population of Montana. They are breathing easier now
because they have access to the doctor's office.
Is it going to be perfect? No. Part of the problem was they
had so many choices. They had the Bronze Plan, the Silver Plan,
the Gold Plan, with all sorts of different networks where they
might want to go with a more affordable option.
And I think this is going to change over time, but we have
empowered the consumer to make that choice by going online and
examining all of the networks. And their health needs are going
to change over time; so, their choices are going to evolve.
I think one of the most fundamental of changes in the law
is now no one can be discriminated against in America from
getting health insurance. Think about your family members, your
neighbors, that had a preexisting condition, cancer, diabetes.
They can't be barred from coverage anymore.
So when we are talking about access, that is really a
fundamental--it is the fundamental change of the ACA, along
with affordability and a meaningful policy. A lot of people
wouldn't pay for an insurance policy because it wasn't worth
very much, but now the law requires these essential health
benefits.
And what hasn't been talked about a lot, it requires that
networks in these plans have to be adequate. Now, it is not
going to be perfect for everyone.
And I really appreciate it, Commissioner, that the State
insurance commissioners are going to have great responsibility
in ensuring the adequacy of networks and that there aren't any
discriminatory issues.
We had one issue in Florida that has always confounded me,
though. Last year during all the political fights the Florida
legislature and Governor actually passed a law that said the
Florida insurance commissioners no longer have the ability to
negotiate rates--health insurance rates.
Have you heard of that being done anywhere else across the
country, that they restricted the power of the insurance
commissioners?
Ms. Lindeen. Yes. Actually, there are all sorts of levels
of authority for insurance commissioners across this country in
terms of the ability to review or even approve rates.
I in Montana, in fact, have never had--this office never
had the ability to review rates until this past year. We
finally convinced the legislature to allow me to review them.
I can't, like, deny the rate increase, but what I can do
over the course of that 60-day time period while I am reviewing
the rate is actually look at whether or not it is an
appropriate rate and reasonable.
And if I find issues, I can go back to the company and I
can negotiate it down. And it has already been working.
Ms. Castor. So is that a benefit to the consumer?
Ms. Lindeen. Oh. It is a huge benefit. We----
Ms. Castor. That is why I can't understand why a State
would take the action to actually say, ``Oh, don't go and
review the health insurance rates.'' That is going to be an
access problem.
And I appreciate your emphasis on solving the issues
together. We have had the Medicaid discussion. In Florida, they
haven't expanded Medicaid. That is about the population of
Montana, again.
So when you are talking about what is an important way to
expand access, we have got to bring our tax dollars back home
to put them to work covering people, helping the hospitals.
I think another one is the ACA also had provisions to
improve the health care workforce. And I know a number of us
are very concerned about primary care: Are we going to have the
providers out there?
HHS has not done a good job with following through and,
frankly, the Congress hasn't given them the money to go and
look at the workforce issues.
My Republican friend and colleague Joe Heck and I have a
bill called the CARE Act, the Creating Access to Residency
Education--I know a number of members here have been concerned
about that--that would allow States, insurance companies, local
communities, hospitals to put up matching funds for residency
positions.
But do you see the primary care situation as one of the
problems going forward with access?
Mr. Gottlieb. Look, I think that we are going to face a
relative shortage of doctors in certain insurance schemes. I
have written that I don't think we are going to face a shortage
of doctors overall in this country.
I think, depending on what insurance scheme you are in, it
could very much feel like you are facing a doctor shortage.
I see a future where I think physician productivity will
continue to increase. I think we are going to see more--greater
access to non-physician providers, like nurse practitioners,
and that is going to alleviate some of the burden.
So I am not a believer that we are going to see a physician
shortage as a result of Affordable Care Act or for anything. I
think that we will see relative shortages in certain insurance
schemes.
Mrs. Ellmers. The gentlelady's time has expired.
The Chair now recognizes Dr. Gingrey from Georgia for 5
minutes.
Mr. Gingrey. I thank the Chair.
And I just wanted to comment on what the gentlewoman from
Florida just said in regard to access. But at what cost? And I
think that is the most important thing for us to keep in mind.
You improve access by the Affordable Care Act.
In his opening remarks, the ranking member said that it's
counterintuitive--and I am paraphrasing here--but
counterintuitive for Republicans to say that they want to
expand access and coverage for the uninsured, yet remain
opposed to the Affordable Care Act, suggesting that there is
nothing out there except the--no way to do this except the
Affordable Care Act.
And that is categorically untrue. In fact, the vice
chairman of the committee, the gentlewoman from Tennessee,
pointed that out earlier in a bill that came out of the
Republican Study Committee that is a fantastic way to approach
this. So we definitely have ideas and have plans.
Commissioner Lindeen, I want to make sure. I may have
misunderstood you in your opening statement. Did you say that,
even before the Affordable Care Act, that in Montana you had
mandated coverage for OB/GYN for all policies that were sold in
your State?
Ms. Lindeen. Yes.
Mr. Gingrey. Would that be mandated for a 55-uear-old
bachelor who had had a vasectomy? If he wanted to get a health
insurance policy in the State of Montana, it would have to
include obstetrical coverage?
Ms. Lindeen. As I said, insurance is about spreading the
risk. And in Montana we have a constitutional law that says
that you cannot discriminate based on gender. And so that is
applied as well to our insurance and health insurance.
Mr. Gingrey. Well, that may be spreading the risk, but I
will tell you that that is insane. And that is what the problem
here is in regards to the Affordable Care Act.
All of these mandates, all this mandated coverage, comes at
a tremendous price, at a tremendous price. And this is only
going to get worse. It is only going to get worse.
Chairman Pitts said at the outset--and I am going to repeat
this because I think people need to understand and listen.
He was talking about the suggestion that, if you like your
doctor, you can keep your doctor; if you like your hospital,
you can keep your hospital; if you like your medication, you
can keep your medication; and, gee, you know, the price is--it
couldn't be better.
And this is just not true; yet, some of my Democratic
colleagues have decided in perpetration of this falsehood to
keep this information on their Web site. In fact, he talked
about the--I think the ranking member's Web site.
It is time to speak the truth so the American people know.
It is time for Washington Democrats to take these statements
down because we know that they are patently false, and the
American people deserve better.
Now, let me go to Dr. Gottlieb and specifically ask you a
question, Doctor.
In Forbes recently, you provided data by physician
specialty on the number of providers included in ACA exchange
plans versus a typical private health insurance plan.
Can you tell this committee about your findings,
particularly as they relate to women's lack of access to OB/
GYNs in exchange plans relative to any other private form of
coverage.
Mr. Gottlieb. So we looked at PPO plans--preferred provider
organizations--offered by the same category in the same market
relative to what they were offering on the exchange. And, on
average, I think the statistic was we found that they had about
50 percent fewer physicians in their exchange-based plans.
It varied across market, but we found some plans with real
inadequacies where, you know, a plan didn't include a single
Mohs surgeon.
We found a plan in a county in Florida of about a quarter
of a million people that had about a dozen pediatricians on the
network.
And we found a plan in San Diego that had fewer than 10
urologists for a very big--the whole of San Diego County.
So we found some plans that had some significant
deficiencies with certain kinds of physicians. And the Mohs
surgeon is relevant because the plans----
Mr. Gingrey. Dr. Gottlieb, I am going to stop you on that.
I want to get one last point in.
And, Madam Chairman, I would like to submit for the record
an ABC News article of just yesterday where the chairman of the
Senate Appropriations Committee cancelled a hearing because of
a fear that Republicans would have amendments to the Affordable
Care Act that would bring down costs that Democratic members
didn't want to vote on.
So I would like to ask unanimous consent to submit this
article from ABC News yesterday.
Mr. Pitts. Without objection.
[The information follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Gingrey. I yield back.
Mrs. Ellmers. Thank you. The gentleman yields back.
And I will say they are going to call votes soon; so, we
are going to try to get as many questions in as possible within
this time frame.
So, with that, I would like to recognize Ms. Capps for 5
minutes.
Mrs. Capps. Thank you very much.
And thank you to the panelists for your testimony today.
I have a question for the Commissioner from Montana. I went
to high school in Kalispell; so, what you had to say about
health care in Montana is important to me.
The Affordable Care Act rollout, in my opinion, was even
more impactful than expected. Over 8 million Americans signed
up for health insurance, many of whom had been living for years
without the security of coverage.
But, as you noted--and rightly so--the law is not perfect.
It is not perfect in California, where I live, either. It is
clear that more could be done to ensure robust provider
networks and broader access.
To be clear, in many cases, the insurance companies, not
the ACA, have been making these decisions. But this is
something I have been working on in my district, an issue that
I think does deserve more attention.
There are some tools available through the ACA that would
address this issue right now.
Commissioner Lindeen, what enforcement authorities do you
use within the ACA in order to ensure that networks stay wide
and people stay covered?
Ms. Lindeen. All right. Well, let me tell you that what we
like to do is we really like to look at ensuring access,
affordability and transparency, making sure that there are
enough providers available based on all sorts of different
types of factors.
And those include everything from looking at general
provider availability, medical referral patterns, hospital-
based providers and whether or not--and, of course, that can be
affected by their willingness to actually contract----
Mrs. Capps. Right.
Ms. Lindeen [continuing]. The geography that exists within
the State, ECPs, and, also, making sure that there is, you
know, just reasonable access to all these specialists. And we
want to make sure that there is good transparency for consumers
to make informed decisions as well.
Mrs. Capps. That is great.
Have you done anything that has been working to broaden the
networks that you could share with us, to just expand the
networks that you do have?
Ms. Lindeen. I can't think of anything really specific off
the top of my head, but I will go back and look and get back to
you.
Mrs. Capps. It seems to be an area that now could use some
additional support. And I want to put on record that I hope
there is ways that we can give you more tools or work with you
in our individual States to make those networks more available.
But, additionally, as you mentioned, there have been
allegations of excessive co-insurance in the specialty drug
tier. We know that specialty tiers are a real problem for the
patients who need those treatments.
They may not only save lives, they can improve the quality
of life of the patient, often helping them to stay off
disability rolls and remain engaged in work, with their
families and in their communities.
But specialty tiers are not a function of the ACA. They
have existed for many years, so much so that some States banned
them long before the ACA became law.
That is why I have been pleased to join with my colleague,
Mr. McKinley, to introduce legislation to address this and put
these specialty drugs back in line with other prescription drug
costs, putting these treatments back in research for those who
need it most.
And a similar problem exists in Medicare and for cancer
patients who are prescribed orally administered chemotherapy
drugs, but only have coverage for traditional chemotherapy.
These issues are real, but they were not created by the ACA, I
believe, and to insinuate them as such is disingenuous.
But if we all now agree that this is a problem, I hope we
can also agree that we should fix it. I want us to be able to
vote on H.R. 460, the Patients' Access to Treatment Act. I
believe we should have a hearing on H.R. 1801, the Cancer Drug
Coverage Parity Act.
We can address these issues right now by passing these
pieces of legislation. So I hope there is a time when we can
have you back and we can tackle these and other pressing health
issues that we face without getting into the political
gamesmanship like we are seeing much of this hearing focused on
today in kind of a biased way.
Strengthening this law, which we know we need to do, will
not be accomplished while we continue a kind of drumbeat for
repeal or going back to the broken system of the past. I know
you are in positions where you see these real needs and that we
need to address on a regular basis.
Thank you. And I appreciate again.
I am going to yield back.
Mrs. Ellmers. Thank you to the gentlelady for yielding
back.
I now recognize Mr. Griffith for 5 minutes. If you might be
able to squeeze----
Mr. Griffith. I will squeeze as quick as I can.
Mrs. Ellmers. OK. Thank you.
Mr. Griffith. Let me just say that, when you are talking
about things like rheumatoid arthritis--and I have a family
member who has that--and you are talking about access to care,
particularly in my region, we are being limited. There is no
gamesmanship being played. The real concern is about what is
happening with the Affordable Care Act.
And I bring this up because--and if we can pull that map up
of my district--I was recently told by not one, but two, of the
folks who are in this business--and if you can look--they are
getting it up there--I am the green part down there.
And you can see why this is a particular problem. Because
what happened in rural Virginia and my part of the State is
that, in many of these areas, we only have one company that is
under the shop plan or one company under the individual plan.
Some places have two. There are not a lot of opportunities.
And what my brokers are telling me is that they are having
to go to their small customers in the shop plan--those are
people with small businesses--and all that is available is an
HMO and that HMO limits them--look at that map--it limits those
people from going to health care providers within the
Commonwealth of Virginia or one county out.
Now, if you are in the Galax or Martinsville area and even
some folks in the Roanoke Valley, up a little bit further on
the border with North Carolina, you are used to going to either
Duke or Bowman Gray. Can't do it with the new plans. You are
outside.
Bristol, Virginia-Tennessee, for those of you who don't
know, it's a wonderful city. The main street of the town is the
State line. If you live on the Virginia side of the line, you
can't go to the Children's Hospital in Johnson City under these
new plans--under the Affordable Care Act's shop plan. You can't
do it.
That happens to be the tri-cities area. Bristol, Kingsport,
Johnson City have worked really hard so that they have the
availability in a relatively rural area to have one of
everything.
And while you can certainly get your children treated at
other hospitals, the hospital where the money has been spent to
have for those high-risk people is in Johnson City.
So if you are living in Bristol, Virginia, on the wrong
side of main street--State Street, but the main side of the
main commercial area, you can't go to that hospital. This is
not games. We are not playing any games.
Are you seeing that that's a problem in other States or is
it just because my district borders so many other States and
you can actually get to other States' teaching hospitals
quicker than you can get to UVA for many of my constituents?
Is that just a problem because I have an oddly shaped
district or is that a problem for other States, Dr. Gottlieb?
Mr. Gottlieb. Well, it seems like a particular problem
there, but this is not that uncommon. The Affordable Care Act
allows county-level bidding by the health plans. So sometimes
you are seeing only countywide networks as a result.
Mr. Griffith. So it is a problem not only from State to
State, but also within counties. I can see where that would be
a serious problem.
Are we seeing, also, a narrowing on the ages? I need to ask
that question. Are we seeing that they are narrowing services?
For example, if you are an 84-year-old woman whose father
died of colon cancer--yes, I am speaking of a constituent--you
normally would be getting your inspection--your colonoscopy
again, are there any limitations because of the age? Are you
seeing any of that?
Mr. Gottlieb. I haven't seen age-based restrictions that go
outside of normal medicine convention in terms of when things
are recommended in these plans. Certainly that would be a
Medicare--more of a Medicare scenario, too.
Mr. Griffith. Yes. I appreciate that.
That being said and because they have already called for
votes and some others want to ask questions, Madam Chair, I
will yield back.
Mrs. Ellmers. Thank you to the gentleman.
The Chair now recognizes Mr. Bilirakis from Florida for 5
minutes. But if I could--if you could, I would love to be able
to--oh. I take that back. I am sorry to Mr. Sarbanes. I
apologize.
Mr. Sarbanes. Thank you, Madam Chair. I will try to keep my
questions under 5 minutes.
There is no question that the Affordable Care Act
represents disruptive change--OK?--but disruptive, I think, in
a very positive way, on balance.
It disrupts the situation where there were millions of
people who were discriminated against based on preexisting
conditions.
It disrupts the situation where millions of young people
were having problems affording the coverage--health care
coverage.
It disrupts the situation where millions of seniors were
falling into the donut hole and not being able to cover that
with the out-of-pocket expenses that it represented; so, we are
beginning to close that donut hole.
And it disrupts most significantly a situation where one
out of seven Americans were being left out of health insurance
coverage to the detriment of those individuals and their
families but, really, to the detriment of the productivity of
our country.
So it is disruptive change and, whenever you have
disruptive change, it is going to take a while to sort of get
everything in place, get it all rationalized, get the system
working as well as the expectations are that we bring to bear.
So, you know, we need to be vigilant, but we also need to
understand that it is going to take some time to get all of
these pieces in place.
And, frankly, if you look at what the Affordable Care Act
itself says about its expectations of the way provider networks
will function, you know, it has provisions that require plans
to create networks that are, quote, sufficient in numbers and
types of providers, including providers that specialize in
mental health and substance abuse services, to assure that all
services will be accessible without unreasonable delay.
It requires plans to contract with, quote, essential
community providers, as that term is understood, that primarily
serve low-income and medically underserved individuals. It
requires plans to equalize cost-sharing for emergency services,
et cetera.
These are requirements that are baked into the law, and it
is going to have the effect over time of addressing this--sort
of the startup bumps that we have in terms of restructuring
these provider networks.
I mean, it used to be the case that you could keep your
cost down. You could say, ``Hey, you can go to any provider you
want,'' but the benefits that were available to cover that were
pretty minimal in certain situations.
So was that really a good insurance plan? Just looking at
the provider network and the expanse of it, you might have
said, ``That is terrific,'' but you look at other features of
it, not so much.
So I just wanted to ask the Commissioner: Do you have
confidence that the tools that you possess, as an insurance
commissioner, are going to be adequate, particularly given
these requirements of the Affordable Care Act that you can cite
and use and enforce to ensure over time that you will be able
to put in place provider networks that can provide the coverage
and the access that people deserve?
Ms. Lindeen. I think that, as long as commissioners at the
State level are given the flexibility to do that and do their
job and be able to enforce those provisions as well--I think
that is going to be a huge help.
But one of the biggest issues that we face is the
transparency issue in making sure that consumers really are
informed about what is actually in these networks and making
good informed decisions for themselves. Because the more
informed they are, the more that they are going to impress upon
the companies in terms of competition and forcing them to make
good decisions that are in the best interests of the patients
as well so that they will get them what they need, so to speak.
But at the same time, the other thing that is really
frustrating, I think, not only for the regulator and for the
consumer and even for the company, is sometimes, with all due
respect, this unwillingness to contract by providers. And I
think that that is an issue that we are all going to have to
deal with.
But, overall, I think that giving States the flexibility to
actually do our job and do it based on the fact that we know
our market's better than anyone else is really going to be
helpful.
Mr. Sarbanes. Thank you.
I yield back.
Mrs. Ellmers. Thank you to the gentleman.
And now I yield time to Mr. Bilirakis. I do want to say
that there are less than 4 minutes left in the vote on the
floor.
Mr. Bilirakis. I will be as quick as I possibly can. I will
ask just one question.
Mrs. Ellmers. Thank you.
Mr. Bilirakis. I won't make any comments on the ACA. I will
go directly into my questions.
Mr. Gottlieb, you have written extensively about the narrow
networks. The Leukemia & Lymphoma Society commissioned a report
about the narrow networks in the ACA.
According to their data, for the State of Florida, my home
State, only 1 of 12 had coverage at the Moffitt Cancer Center
in Tampa, Florida, the only NCI-designated cancer center in the
State.
All Children's Florida hospital, Jackson Memorial, Mayo
Clinic, Miami Children's Hospital, Moffitt, Nemours in
Jacksonville, Sylvester in Miami, and Shands in Gainesville--
only 4 ACA plans out of 12 covered any one of these hospitals,
any one of these hospitals.
Mr. Gottlieb, it doesn't seem like it is very accessible.
It seems to me that the people most disadvantaged by the law
are the sick, the patients with serious, chronic, and complex
medical conditions.
Are these narrow networks and closed formularies
disadvantaging the sick and the most vulnerable, in your
opinion?
Mr. Gottlieb. Well, I think, unfortunately, they will. You
are absolutely right. I am on the policy board of the Leukemia
& Lymphoma Society. You are absolutely right.
The academic cancer centers have been actively excluded
from these plans largely because they are more expensive. And
people who have rare cancers will not be able to get care
there, and other people who might have more common cancers, but
just want a second opinion, won't be able to get it.
Mr. Bilirakis. Extremely unfortunate.
I yield back.
Mrs. Ellmers. Thank you to the gentleman.
I now yield time to Mr. McKinley. And, if you can, try to
keep it close. Thank you.
Mr. McKinley. Thank you, Madam Chairman.
Dr. Harvey, if I can direct this to you in the very short
time period--I have got a question as to how you would handle
this scenario that we are facing in West Virginia.
Recently I met a 15-year-old girl from West Virginia. She
is suffering the early symptoms of juvenile arthritis--
rheumatoid arthritis. But thanks to biologic medicine and the
drug she has been on, she has been able to participate and
actually has become a track star.
I am curious. If her family is ever faced with a scenario
that they have to go into an exchange--and in West Virginia we
only have one compared to--in Montana you have three. We have
one.
But her family's income is $50,000. So it is probable and
likely that they can afford to go to the cheapest plan within
that exchange. So they are either going to be faced with not
having biologic coverage or being forced to go to something
that is more expensive that they can't afford, either.
So in either case, she is either out $12,000--by paying a
higher premium--or the family has to pay maybe $75,000 to
$100,000 a year. What would you advise?
Mr. Harvey. Well, it is a very difficult problem. I think
the main option, actually, is to provide cheaper medications,
which are usually far more toxic, actually, and there are
attendant costs associated with that. There aren't very many
other solutions.
The main solution that presents itself is your bill, sir.
And I think--you know, I wear a fork on my lapel that has bent
tines, and it is meant to symbolize the deformities that people
with arthritis can develop, but, also, the simple tasks that
they are prevented from doing.
And you all can help us unbend those tines by providing
support for people so they can afford their co-pays.
Mr. McKinley. Thank you. I appreciate your support for 460.
I think we do have to move on that. Thank you very much.
I yield back the time.
Mrs. Ellmers. Thank you to the gentleman.
In the interest of time, I will submit my questions for a
written response.
I would like to remind the Members that they have 10
business days just to submit questions for the record.
And I ask the witnesses to respond to the questions
promptly.
Members should submit their questions by the close of
business Thursday, June 26.
Without objection, this subcommittee is adjourned.
[Whereupon, at 11:41 a.m., the subcommittee was adjourned.]
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