Next week, Congress will take an important step toward addressing one of the most pressing issues facing America’s seniors: the rising cost of health care. As part of a broader series of hearings proposed by Congress to examine health care affordability, the House Committee on Energy and Commerce and the House Committee on Ways and Means will convene on January 22 to explore the forces driving costs ever higher. For older Americans living on fixed incomes, these hearings come at a critical time.
Across the country, seniors have watched health care expenses grow faster than retirement savings, Social Security benefits, and cost-of-living adjustments. Out-of-pocket hospital bills and other medical expenses continue to strain household budgets, forcing difficult choices for retirees who planned responsibly but are now squeezed by a system increasingly out of balance. While many factors contribute to rising health care spending, one of the most significant – and least scrutinized – drivers is hospital pricing and the growing consolidation of hospital systems.
Hospital costs have dramatically outpaced national inflation over the past 25 years. Since 2000, hospital prices have risen by more than 270%, far exceeding the growth of the broader economy. Equally shocking, hospital services account for almost one third of Americans’ health expenditures. These increases cannot simply be explained by better care or improved outcomes. In many regions, hospital consolidation has reduced competition, allowing large systems to exert greater pricing power over insurers and, ultimately, patients and taxpayers. Seniors feel the impact directly through higher Medicare cost-sharing, rising Medigap premiums, and increased out-of-pocket costs when medical care is needed most.
As hospital systems grow larger and more dominant, pricing often becomes disconnected from value. Seniors may be charged vastly different amounts for the same procedure depending on geography, even when quality outcomes are comparable. This lack of transparency and competition undermines the promise of a market-based health care system and places an unfair burden on retirees who have limited ability to absorb unexpected medical expenses.
The House Committee on Energy and Commerce and the House Committee on Ways and Means deserve recognition for focusing attention on health care affordability. Congressional oversight is essential, and these hearings represent an important opportunity to examine why costs continue to rise despite decades of reform efforts. However, meaningful progress will require looking beyond insurers and payment models and taking a hard look at hospital pricing practices and consolidation trends that distort the marketplace.
America’s seniors worked, saved, and planned for retirement with the expectation that health care would remain accessible and affordable. Policymakers now face a responsibility to ensure that hospital systems are held accountable, competition is preserved, and pricing power is not abused at the expense of patients. Continued scrutiny of hospital costs is essential to protecting the financial security and dignity of older Americans.
