CBO Report Requested by Chairman Yarmuth Examines Major Drivers of Rising Health Care Costs: System Inefficiencies & Market Consolidation

Berry Craig

21 Jan, 2022

FROM THE OFFICE OF CONGRESSMAN JOHN YARMUTH

Washington, D.C.— On October 9, 2020, Kentucky Congressman John Yarmuth, Chairman of the House Budget Committee, sent a letter to Congressional Budget Office (CBO) Director Hon. Phillip Swagel requesting a report on the major drivers of increases in health care spending in the U.S., the variation in health care prices and costs, and mechanisms to hold down growth in spending.

Yesterday, CBO released the first of two reports in response to Chairman Yarmuth’s request. The report, “The Prices That Commercial Health Insurers and Medicare Pay for Hospitals’ and Physicians’ Services,” examines potential reasons that the prices paid by commercial health insurers for hospitals’ and physicians’ services are higher, rise more quickly, and vary more by area than the prices paid by the Medicare fee-for-service program.

Chairman Yarmuth released the following statement on CBO’s findings and potential next steps:

“We know that our country and our economy are stronger when every American has access to quality, affordable health care. But CBO’s report finds that inefficiencies in our health care system and market consolidation are driving up prices, forcing Americans to either forego necessary coverage or face higher premiums and out-of-pocket costs, reduced benefits, or lower wages. Congress must do more to reduce this unacceptable burden on American families.

“Every American should have the right to quality, affordable health care and the House Budget Committee will continue to pursue options to achieve this goal. I look forward to CBO’s follow-up report outlining how policy approaches can lower health care costs for families and reduce stress on the federal budget – without sacrificing accessibility or quality of care.”

This CBO report and its upcoming report add to a body of research about our health system requested by Chairman Yarmuth: