The Lower Health Care Costs Act of 2019

Senators Lamar Alexander (R. TN), Chairman and Patty Murray (D. WA), ranking member of the Senate Health, Education, Labor & Pensions (HELP) Committee have released a discussion draft of legislation intended to address some of the most frustrating issues of the U.S. health care system.  The proposed legislation (see summary here) addresses five topics:

  • Ending surprise medical bills
  • Reducing the prices of prescription drugs
  • Improving transparency in health care
  • Improving public health
  • Improving the exchange of health care information.

Like most legislation affecting health care, the devil is in the details.  This draft bill is a valiant attempt, but reflects the fragmentary nature of the regulatory environment of health care in the U.S.  The federal government can influence only parts of the health care system - much is controlled by the states due to their regulation of the business of insurance and public health within the state.  So many parts of the bill apply only to self-funded plans (governed by ERISA), Medicare and states that agree to participate in this regulatory scheme.  This leaves out funded insurance products and Medicaid programs in non-participating states.

The section entitled "Improving Transparency in Health Care" addresses not only information sharing, but also anti-competitive practices.  The health care industry is a hotbed of merger activity these days, and there are some markets where a major insurer dominates, and others where a major health care provider system dominates.  This section contains a mix of some provisions favoring insurers, and one that favors providers.  The section also includes some things that you would think are no-brainers (but remember this is the U.S. healthcare system we're talking about).  For example, the bill would require providers and health plans to provide a good faith estimate of out-of-pocket costs for specific services, "and any other services that could reasonably be provided, within 48 hours of a request".  The thing is, not every incident of care is the same.  One patient may need a stay in the intensive care unit after surgery, and another may not - what should be included in the estimate?  Also, if there's a difference in the estimate from the insurer and from the provider, which should the patient believe?

Of course, it is easy to poke holes in any attempt to address problems with our health care system.  The HELP Committee at least deserves credit for trying to identify and address concrete problems.