House subcommittee hears that consolidation, opaque pricing and Medicaid cuts are squeezing patients and providers

The House Energy and Commerce subcommittee examined how consolidation and payment policies are affecting health care affordability and patient access, with hospitals, physician groups, employers and disability-service advocates testifying that current market incentives are narrowing options and driving up costs.

In opening remarks, the subcommittee chair said the hearing would evaluate “the provider landscape” and warned that market consolidation has left many patients with few choices. Richard Pollock, president and CEO of the American Hospital Association, said hospitals face rising supply, drug and labor costs and growing regulatory burdens that strain finances. “Hospitals are the backbone of the nation’s health care and one of the key elements of our national critical infrastructure,” Pollock said, urging collaboration on care transformation and administrative simplification.

Physicians’ groups told lawmakers those pressures are pushing independent practices to sell or close. David Azis, chair of the American Medical Association board of trustees, said physician payment has fallen sharply in real terms and that reforms to Medicare physician payment are needed to keep local practices open. “Physicians want to care for all patients… Congress can aid in this mission by recognizing that affordability is inseparable from access and promote policies that ensure consistent, reliable, and locally accessible physician care,” Azis said.

Family physicians’ representatives pointed to the growth of employment by hospitals and other entities as a marker of consolidation: “Today, nearly 75% of family physicians are employed by hospitals or other entities,” Sean Martin of the American Academy of Family Physicians told the panel, adding that stronger investment in primary care and reduced administrative burden would lower system costs.

Employers and purchasers pushed for better price and quality transparency. Elizabeth Mitchell of the Purchaser Business Group on Health, which represents large self‑insured employers, said purchasers are using available price data but that compliance with existing federal price‑transparency rules is incomplete. “We need meaningful price and quality transparency so that purchasers and patients can make informed decisions,” she said.

A recurring policy dispute centered on recent federal legislation referenced in the hearing as HR 1 and proposed or implemented changes to Medicaid and ACA premium subsidies. Democratic members argued those changes would cause millions to lose coverage and force hospitals to carry more uncompensated care; Republican members stressed protecting hospitals and preserving quality. Pollock said hospitals are preparing scenarios to respond to federal Medicaid changes and that closures in rural and underserved areas are a real risk.

Members and witnesses debated policy tools. Proposals discussed included:

- Reforming Medicare physician payment with an inflationary update tied to the Medicare Economic Index to stabilize independent practices; witnesses from the AMA and AAFP supported such an update. - Strengthening enforcement and uniformity of price‑disclosure rules and advancing an “advanced explanation of benefits” so patients and purchasers receive accurate front‑end estimates of their negotiated costs. - Targeted reforms to the 340B drug discount program to ensure discounts benefit safety‑net providers and patients rather than being used in ways that can mask commercial pricing. - Revisiting regulatory barriers that restrict physician ownership or participation in certain facility types (witnesses debated Section 6001 of the Affordable Care Act and Stark law provisions).

Several witnesses warned that cuts to Medicaid and reduced ACA subsidies would increase uncompensated care and could force hospitals to reduce services. Ranking Member Diana DeGette highlighted estimates that tens of thousands of rural hospital jobs and dozens of facilities could be threatened; Pollock agreed the risk is substantial and urged precision in policy choices to avoid collateral harm to Medicaid‑dependent services.

The hearing also addressed workforce shortages, including projected physician shortfalls and a nursing shortage, and discussed longer-term solutions such as expanding residency capacity, loan‑repayment incentives and incentives for clinicians to practice in underserved areas.

The subcommittee did not take formal action at the hearing. Members repeatedly requested written follow‑up from witnesses and urged enforcement of existing transparency requirements as an immediate step. The hearing record remains open for additional questions requested by the chair.