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'This is simply wrong' — HHS Sec. Alex Azar criticizes high prices in hospitals compared to physician offices

HHS Secretary Alex Azar discussed President Donald Trump's vision of healthcare in a prepared statement for the Federation of American Hospitals, mentioning the president's interest in limiting regulation, promoting transparency and shifting care to the most appropriate setting.

 

"Imagine a day when healthcare delivery in the United States functions the way other parts of our economy do," he said. "We as patients would pick providers with the level of information we have when using Amazon or Yelp. Consumers would drive quality and cost-effectiveness with information, competition and genuine choice."

He also took on regulations as they relate to value-based care and criticized anti-competitive policies in healthcare.

"Some argue healthcare is simply different and is and should be immune from market forces. I simply disagree," he said. "Real competition — in the economic sense — has never really been fully tried in our bizarre third-party payer system."

He said President Trump is ready to disrupt the "existing arrangements" in healthcare and isn't interested in incremental steps. The administration also aims to support efforts to give patients control over their records and healthcare information and promote price transparency.

He relayed a personal experience from a hospital in Indiana; Mr. Azar was referred to a local hospital in the state for an echocardio stress test. He was in the process of being admitted when he asked about the price of the procedure and was quoted $3,500. However, he found online the test could be done for $550 in a physician's office outside the hospital.

"Now there I was, the former deputy secretary of Health and Human Services, and that is the kind of effort it took to find out how much I would owe for a procedure," he said. "What if I had been a grandmother? Or a 20-something with a high-deductible plan? This is simply wrong. It cannot continue if, as most people in America agree, we want some degree of a consumer market when it comes to healthcare."

Finally, Mr. Azar touched on new regulations and potential for innovation. "In all of this work, we've been informed by your responses to CMS's request for information; they have been immensely valuable and we will act on them," he said. "We will also bear in mind whether new burdens created by models or scale that are required for viability may be driving consolidation in the healthcare market. As a matter of principle, we want to move to a system where we can be agnostic about ownership structures, a system that will allow independent providers to group together to drive innovation, quality and competition."

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