NASHVILLE—The audience of healthcare executives had expected the heads of the influential insurance and hospital lobbying groups to butt heads. But Matt Eyles, CEO of lobbying group America's Health Insurance Plans, and his counterpart Chip Kahn of the Federation for American Hospitals were on the same page Wednesday while discussing potential threats to their industries and who they consider the culprit in the nation's healthcare costs conundrum.
They were so congenial that audience members at the Nashville Health Care Council discussion prodded the moderator to find some topic they could spar over. But there were few points of contention. Eyles and Kahn were united in their opposition to the Medicare For All proposals, which they agreed are largely symbolic but something to be taken seriously.
Their comments came on the heels of the House Democrats' introduction on Wednesday of a bill with more than 100 co-sponsors to extend Medicare to all Americans and eliminate private insurance. AHIP and the FAH, which represents investor-owned hospitals, released statements saying the legislation would disrupt care for Americans. The two, along with many other healthcare industry groups, have also launched an initiative called the Partnership for America's Health Care Future to fight the growing support for Medicare for All.
"That bill being introduced is a tremendous disappointment for me," Kahn said Wednesday, adding that it should be taken seriously because "the Trump election showed we can't predict anything anymore in terms of how far the public will go…and the leadership."
Kahn explained that the Partnership for America's Health Care Future, which was his brainchild, was formed to provide "counter-messaging" against Medicare for All: "We have to tell the people we serve and give them messages about how we feel about this, knowing that we want to serve them, and we know healthcare needs to be financed but this is the wrong way to go."
When Kahn called AHIP, Eyles said the organization was among the first groups to join. On Wednesday, he reiterated AHIP's stance that "people want to fix what's broken" instead of beginning again with an entirely new health system.
"Even within the context of this legislation, I believe it was a 2-year transition," Eyles said. "Can you imagine transitioning 20% of our economy in a two-year period? That's an unrealistic element. But we do need to take it seriously and come up with what a better way is forward" to achieving universal coverage.
The two also blamed the pharmaceutical industry for the rise in drug spending and agreed that coming down on pharmacy benefit managers and health plans for the rebates they negotiate fails to fix the drug pricing problem at its root.
"To blame PBMs and plans for rebates, when you control the price...is really a deflection," said Eyles, who before AHIP spent years at drug companies Eli Lilly and a division of Pfizer. "Not once did anyone ever say, 'how much did we spend on research and development for this product?' when we were trying to figure out what the price would be. It was what would the market bear and how high could we go?"
But the drug pricing problem isn't an easy one to fix, Kahn said. The Trump administration's proposal to peg Medicare Part B drug payments to the lower prices paid in European countries worries the Federation of American Hospitals, Kahn explained, because it worries the administration coulld move to regulate all the prices in the private healthcare sector.
A growing body of research shows hospital prices are a big driver of increasing healthcare spending.
AHIP was more supportive of the reference pricing proposal, but only in circumstances in which a drug on the market has no therapeutic alternative and no competition because of patent, Eyles said. He stressed the importance of bringing competition to the drug industry by encouraging biosimilars and ending drug patent gaming, for instance.
Eyles also said the industry is watching what the hospital-led not-for-profit drug company Civica Rx accomplishes in addressing drug prices and shortages of drugs used in the hospital setting, and "trying to think through if there's some model on the small molecule, on the pill side, that you could adopt as well."
Eyles and Kahn also agreed in that there's a need for federal legislation to combat surprise billing, which sometimes occurs when a patient visits an in-network hospital but is unknowingly treated by an out-of-network physician, such as an anesthesiologist.
But finally, the two clashed when it came to hospital mergers and acquisitions. Eyles argued that while the spate of so-called vertical insurance mergers is less about gaining market power and more about achieving better patient outcomes through integrated care, hospitals' and health systems' habit of buying up physician practices have led to higher prices.
Those deals "are largely invisible, not regulated, and you only know when you go to your physician's office one day and have a new logo, and you're like well, what changed here? Probably the price changed, but not much else changed other than that" Eyles said.
While Kahn didn't address hospital acquisitions of physician practices, he argued that consolidation among hospitals is inevitable because of declining inpatient services coupled with requirements for electronic health records, among other regulatory pressures. Freestanding hospitals are no longer viable, he said.
"All the noted economists, insurance company CEOs and others and policymakers who complain about hospital consolidation are living in a total fantasy world," he said.
