C-suite execs want government action on rising healthcare costs, report finds

Dive Brief:

  • Large employers are increasingly supportive of government intervention when it comes to tackling the rising cost of healthcare for their workers, according to a survey released Thursday from the Kaiser Family Foundation and Purchaser Business Group on Health.
  • Business leaders showed wide support for lawmakers pursuing policies that would improve price transparency (90%) and strengthen antitrust enforcement (92%) among providers, payers and drugmakers, the report found.
  • They also favor capping hospital prices in noncompetitive markets and limiting out-of-network charges, along with some of President Joe Biden’s loftier healthcare policy goals, such as lowering the Medicare eligibility age.

Dive Insight:

The findings contrast with commonly-held beliefs that those in the C-suite want limited interference from lawmakers when operating their businesses. But paying for employee health coverage is part of their business — and a rising expense that 90% of respondents said will be unsustainable in the next five to 10 years.

Researchers surveyed more than 300 CEOs, chief financial officers, chief operating officers and other leaders at companies with more than 5,000 employees from December to January, though notably excluded leaders from healthcare firms.

Among respondents, 85% said government intervention is necessary to rein in costs and ensure coverage, and 80% said it would be beneficial to their business and employees if lawmakers stepped in.

“For every dollar spent on healthcare, it’s one less dollar available for wages, investments and other essential business expenses,” Lanhee Chen, a former policy adviser to Republican Sen. Mitt Romney, now at the Hoover Institute, said during a Thursday webinar on the report’s findings.

Healthcare spending in the U.S. rose 4.6% in 2019 — on par with previous years, and accounting for 17.7% of the nation’s total gross domestic product, a December analysis from the CMS Office of the Actuary published in Health Affairs found.

Panelists indicated there’s bipartisan support for government action, though the Trump administration had a near opposite agenda than Biden on the Affordable Care Act. They pointed to other health policy changes former President Donald Trump pushed for, including price transparency and lowering the cost of prescription drugs.

Republicans don’t want to be opposed to these issues, “frankly because some of their constituencies and particularly the employer community is really asking for relief, especially because they feel that there have been some very real market failures that have to be addressed by federal intervention,” Chris Jennings, president of Jennings Policy Strategies and a former adviser to President Barack Obama, said.

“What policy, what legislative vehicle, how it’s packaged, when it will occur, I’m not sure I can be that prophetic for you — but I will prognosticate that there will be action and the likelihood for action is more likely than not.” Jennings said.

The COVID-19 pandemic and resulting economic downturn could also help set the stage for reform.

“We are trying to bring back the U.S. economy from a pandemic, and we know that controlling healthcare costs will enable businesses to grow and to invest in business, in jobs,” Elizabeth Mitchell, CEO of PBGH said.