Says we’ll never have lower-cost health insurance until we have lower-cost health care
“I'm going to focus on making the system more of a market, getting rid of barriers, and—if I could—find a way to make it possible for those of us who buy health care services every day to know the price of what we're paying for.” – Sen. Lamar Alexander
*You can watch Senator Alexander’s discussion with Axios’ Mike Allen here*
WASHINGTON, December 12, 2018 — Senate health committee Chairman Lamar Alexander (R-Tenn.) today said the health care debate should “move from health insurance to health care costs.”
At an event hosted by Axios today, Alexander discussed his 2019 health care policy priorities, specifically reducing the cost of health care, with Axios co-founder and Executive Editor Mike Allen.
“My focus over the next two years is to see if we can do one or two big things to reduce health care costs and maybe 10 or 12 little things and try to move the whole debate from health insurance where we've been stuck for eight years arguing about six percent of the health insurance market, that's Obamacare, to health care costs,” Alexander said. “You'll never get lower-cost health insurance until you have lower-cost health care.”
He added: “We've had five hearings on reducing health care costs and Dr. Brent James, who is a member of the American Academy of Medicine said that 30 to 50 percent of what we spend on health care is unnecessary. So I was so startled by that, that I asked the other witnesses, they agreed with him, and I asked the next panel of witnesses and the next, and they agreed with him too. That means that, of the huge amount we spend on health care, we unnecessarily spend an amount of money that's more than the gross domestic product of every country in the world, but nine.”
Mike Allen: You said that one of the biggest problems is people don't know the true cost of their health care.
Alexander: “Well, that's it. The first thing is to get rid of the barriers in the way of innovators, but nobody knows the cost. Secretary Azar is going to be here. He's got a great story about how he went for a procedure and found out it costs several thousand dollars and he got on the website and checked around and found out he could get it for $550 in the doctor's office. So the way our system is set up, you don't know the price and if no one knows the price, prices aren't going to come down.”
Mike Allen: Now you talked about the next two years, and in January, we're going to have divided government… What is one big thing that you believe you can accomplish next year as Chairman?
Alexander: “Well, I've talked already with [Senator Patty Murray], and on my short list is reducing health care costs. … I'm going to focus on making the system more of a market, getting rid of barriers, and if I could find a way or ways to make it possible for those of us who buy health care services every day to know the price of what we're paying for, that would be the single most important thing I could focus on for two years. I mean, we should do that. The Members of Congress should not sit around with the facts in front of us that we're spending $1 to $1.8 trillion unnecessarily on health care and not do anything about it.”
In a Senate floor speech yesterday, Alexander announced he will be seeking specific legislative, regulatory, or sub-regulatory solutions to help lower health care costs. During the speech, he said, “Up to half of health care spending is unnecessary.”
Alexander yesterday sent a letter to leading health care experts at the American Enterprise Institute and the Brookings Institution, economists, doctors, nurses, patients, hospital administrators, state regulators and legislators, governors, employers, insurers, and innovators asking them to identify specific ideas about how to reduce health care costs for taxpayers, employers, and families after concluding a series of five Senate health committee hearings exploring the same topic.
At the first hearing of the series, the committee established a common understanding of how much health care costs; at the second hearing, the committee explored ways to reduce unnecessary health care spending; at the third hearing, the committee focused on ways to reduce the administrative burden on doctors and hospitals; and at the fourth hearing, the committee focused on finding ways to improve access to information about the cost and quality of health care for patients. At the fifth and final hearing of the series, the committee examined what the private sector is doing to encourage innovation and what Washington can do to get out of the way to lower costs.