The Congressional Budget Office's recently released list of policy proposals to lower healthcare premiums fails to address the real causes behind those rising costs, the American Hospital Association said in an Oct. 10 response to the report.
The AHA said the three approaches outlined in the report to cut reimbursement for physician and hospital services would have "negative effects on patients and the organizations that care for them and questionable effects on lowering premiums."
The organization said the CBO's report is "premised on the erroneous assumption that hospital prices are the primary driver of high health insurer premiums." Pointing to data from the Bureau of Labor Statistics, the AHA said hospital price growth (2.1 percent) has trailed insurance premium growth (4.5 percent) over the past decade.
The AHA also criticizes the report for dismissing "two of the most fundamental determinants of hospital prices: input costs and structural underpayments." Input costs include salaries and benefits for workers, which make up 50 percent or more of a hospital's cost, the group argues. Other input costs such as drugs, equipment, supplies and technology need to comply with the "complex administration of healthcare, such as determining eligibility for coverage with a patient's health plan."
"Put simply, reducing provider reimbursement would compound the many financial stresses already faced by our nation's hospitals and health systems," the group said.
Read the AHA's full response here.