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Senate Finance Committee Hearing: The Rising Cost of Health Care

Video of November 19 hearing, with testimony by: [1] Douglas Holtz-Eakin, Ph.D.. American Action Forum; [2] Jason Levitis, Urban Institute; [3] Brian Blase, Ph.D., Paragon Health Institute; and [4] Bartley Armitage. Eugene, OR.

A Little-Known Way the Tax Code Subsidizes Spending on Health Care

"Tax law changes over the last decade resulted in a smaller role for itemized deductions overall, including the [itemized medical deducsion (IMD)], and concentrated benefits among older, higher-income taxpayers. The IMD could be reformed to better target relief to those with high medical costs in budget-neutral ways. However, alternative policies would likely more effectively protect Americans against uncovered health risks."

Expanding the Benefits Horizon: How Employers View Voluntary Offerings (PDF)

27 pages. "Ninety-six percent of employers say their benefits budget has grown during the past two years ... Nearly three-quarters of organizations list health care costs as an issue their benefits program is designed to address, yet only 11 percent offer accident, critical illness, and hospital indemnity insurance.... More than one in three organizations that offer dental, vision, or supplemental health benefits say enrollment for each of these benefits is higher than expected.... Sixty-five percent of employers see room for improvement in how they communicate to employees about benefits. "

Preventive Health Services: What Are They and How Much Do They Cost?

"Even though patients should not have to pay anything for covered preventive services, insurers must still cover the cost of these services. The price of each preventive service is the total amount paid by insurance for the service and represents what patients could pay if the service no longer qualified as no-cost preventive care. [A table illustrates] the price of selected preventive services."

Only 4% of Health Spending Goes to Primary Care

"Despite the virtues and benefits of primary care, it seems to be getting harder to access. In 2025, there were 7,901 primary care health professional shortage areas. A recent report found that primary care physicians per capita declined between 2012 and 2021, and fewer trainees chose to pursue primary care than specialty care over the same period.... Nationally, among people with ESI, primary care made up 4.39% of total medical and prescription spending in 2022. Primary care spending in Medicare FFS was lower than ESI, at 3.86% of total spending. "

A Small Number of Workers Account for Most Health Costs (PDF)

"20 percent of individuals with employment-based health benefits account for roughly 80 percent of overall spending.... One percent of enrollees account for 29 percent of spending. While the average spending for this group is $206,000 per person and median spending is $150,000, everyone in this group used at least $96,000 in health care services.... The prevalence of chronic conditions is relatively high among people who use a lot of health care services."

System-Affiliated Hospitals Associated with Higher Prices (PDF)

"In 2022, 45% of per-person health spending among people with employer-sponsored insurance was spent on inpatient or outpatient services. Per-person spending on hospital care among the ESI population grew by 13.5% from 2018 to 2022, driven by increasing prices.... System-affiliated hospitals experienced faster growth of inpatient prices (44% from 2012 to 2021) than independent hospitals (35% from 2012 to 2021)."

Use of Health Care Services Among ESI Adults Aged 55-64 Compared to Other Age Groups (PDF)

"The exhibits in this brief illustrate how health care use and spending vary by age group ... They illustrate that people enrolled in ESI aged 55-64 use more services than all other adult age groups across all service categories. Per person spending also is higher for this age group than all other adults."

MissionSquare Encourages Congress to Pass the Retirement Fairness for Charities and Educational Institutions Act

"The bipartisan legislation [HR 1013] would ensure working Americans in education, charitable organizations, public service, and certain types of health care can access cost-efficient investment options available in all other retirement plan types, such as 401(k)'s and governmental 457(b)'s. While SECURE 2.0 helped move forward the necessary first step to provide 403(b) plans with lower-cost options by allowing CITs or group trusts, the securities law changes needed to make the provision effective were not included in the final bill."

Facility Fees: What Are They and How Do They Impact Health Care Prices?

"State and federal policymakers have considered and enacted a number of policies to address the difference in price associated with where a service is provided.... This brief explains what a facility fee is and illustrates one way they operate in practice. It then walks through two examples of the kinds of facility fees of greatest concern to consumers and policymakers."