Health care costs too much because of this quirk. Here’s how we can fix the system

The high cost of health care for Idaho patients has never been higher. While the state is working hard to ensure every patient has access to quality care, the burden on patients and families is almost too much to bear.

Much of this rise in cost is due to corporate hospital system takeovers. It’s a trend that impacts nearly every community in America.

As of early 2024, 78% of all private physician practices were owned by corporate hospital systems. Newly acquired independent doctor’s offices are reclassified as hospital outpatient departments (HOPDs), which means the new owners can charge patients much higher prices — even though nothing has changed about the service they receive at an HOPD.

This happens because Medicare reimburses hospitals for procedures at a higher rate than it does for private practices. HOPDs charge patients an average of 14% more for care, which is not sustainable for the people of Idaho.

It’s a process that incentivizes hospitals to buy out independent practices to boost their bottom line. This is a troubling dynamic in such a competitive industry – in order to grow, you must expand – but this trend puts our physician-owned facilities at risk.

This broken billing system is costing patients and Americans hundreds of billions in tax dollars. According to the Committee for a Responsible Federal Budget, policies that end unfair hospital billings would reduce Medicare spending by more than $150 billion.

With patients choosing to go without health care due to cost, families shackled by medical debt, and physician-owned practices on the verge of extinction, we simply must demand a change — especially with massive savings on the table.

But this is not a problem that local and state governments can tackle alone. We need Congress to step in and address this problem and institute swift billing reform in our health care system.

Luckily, two pieces of legislation can help. The Site-based Invoicing and Transparency (SITE) Act in the Senate and the Facilitating Accountability in Reimbursement (FAIR) Act in the House. Both bills will combat these unfair hospital billing practices by implementing site-neutral payment requirements. With the passage of the FAIR and SITE Acts, patients will pay a fair price for their care, regardless of where they are treated.

The SITE and FAIR Acts would also remove some of the financial incentives for corporate health systems to acquire independent practices – and keep more independent Idaho physicians in charge of their practices.

I urge Idaho’s federal delegation to support the SITE and FAIR Acts. It is not too late to make this common-sense policy a priority. It will go a long way toward protecting the access and affordability of necessary health care for Idaho’s families.