As California's top watchdog, Xavier Becerra has sought to revive competition in healthcare using lawsuits. As HHS chief, he'd have a new go-to: regulation.
HHS is a massive $1 trillion-plus department that contains key federal functions like Medicare and Medicaid, drug regulation and public health. While it doesn't handle antitrust issues—the main thrust of Becerra's current role as California's attorney general—some experts say he'll still be able to affect broad change from his new post, if confirmed.
"The lever of regulation is different than the tool of litigation, but it's toward the same ends of making sure people have the care and coverage they need, the patient protections they need and can navigate the politics of a complicated health system," said Anthony Wright, executive director of the consumer advocacy group Health Access California.
Members of the Congressional Hispanic Caucus pushed President-elect Joe Biden last week to name Becerra to lead the U.S. Department of Justice, an appointment that would rightfully have had merger-hungry hospitals shaking in their boots. Becerra has gained a reputation for being tough on healthcare deals, pushing a bill that would have given him more control over healthcare mergers and even suing Sutter Health over its anticompetitive practices.
"The case settled in late 2019, and the settlement includes several features that could find resonance in HHS policy initiatives, such as price transparency requirements and constraints on out-of-network billing," said Bradley Arant Boult Cummings Partner Travis Lloyd.
Antitrust enforcement is not within HHS' purview, but that's also just one component of protecting healthcare competition, said Glenn Melnick, a professor of public policy at the University of Southern California's Sol Price School of Public Policy. Becerra has proven himself an expert in how the healthcare market works, and understands that prices are the reason healthcare spending is through the roof, he said.
"The reason prices are rising in a lot of markets is because we've lost competitiveness," Melnick said. "I'm optimistic and hopeful he'll take some of his lessons from California and spread them across the country."
At the top of Melnick's wish list: Regulation to cap hospitals' emergency department charges at 160% of their costs, a change that would generate billions of dollars' worth of savings per year. Melnick said a huge cost driver is hospitals pulling out of insurers' networks and charging up to 500% market rates for emergency services.