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Congress must act to rein in consolidation in the healthcare system while still encouraging competition, Shawn Martin of the American Academy of Family Physicians (AAFP) said Thursday during a Senate hearing.

"A competitive healthcare marketplace benefits patients," Martin, executive vice president and CEO of the AAFP, in Leawood, Kansas, said at a . "Congress must reform Medicare and Medicaid fee-for-service payment, advance site-neutral payment policies, implement billing and price transparency legislation, and bolster support for primary care practices to enter into alternative payment models."

On the enforcement side, Congress should "implement additional reforms to address consolidation, including improving federal regulators' antitrust enforcement authorities and their resources, and restricting the use of unreasonable non-compete agreements in physician employment contracts," he added, noting that 73% of all AAFP members and 91% of new family physicians are now employed by other entities rather than working in independent practices.

Senate Finance Committee chair Ron Wyden (D-Ore.) expressed concern about mergers between hospitals and those between health insurers. "Advocates for proposed mergers often say that they're going to lower healthcare costs due to increased efficiency," he said. "Time after time, it has simply not proven to be the case. When hospitals merge, the prices go up, not down; when insurers merge, premiums go up, not down."

In addition, the mergers don't seem to improve quality of care. "A deeply troubling showed that medication adherence significantly decreased among communities of color in the elderly if they visited a primary care provider that was run by a hospital system rather than an independent physician," Wyden said. "So the consequences of increased consolidation are just beginning to be understood, and there's going to be more to come."

Zack Cooper, PhD, associate professor of public health and economics at Yale University, in New Haven, Connecticut, said he was concerned about the impacts that rising health insurance premiums have on workers. "Over the last two decades, insurance premiums in the U.S. have gone up over 215%," he said. "This is markedly faster than the growth in median household income ... Provider consolidation is one of the leading drivers of health spending and health insurance premium growth right now."

He recommended avoiding policies that are inadvertently driving consolidation, citing the lack of site-neutral payment policies in Medicare and the federal 340B program that allows hospitals serving lower-income patients to purchase drugs at a discount. "I think both are inadvertently leading hospitals and physicians to vertically integrate," Cooper said.

He also stressed the need for better antitrust enforcement. "Right now the agencies are pretty clearly underfunded. This means that there aren't enough cops on the beat and that there are mergers that are happening in the health sector and outside of the healthcare sector that are raising prices across the country."

Caroline Pearson, executive director of the Peterson Center on Healthcare, in New York City, urged the development of all-payer claims databases. Without that data, it will be difficult to analyze variation in healthcare spending or improve marketplace competition, she said.

Sen. John Cornyn (R-Texas) explored a different subject. "Our healthcare system is really a sick care system," he said. "For example, adult onset diabetes causes hundreds of billions of dollars in excess healthcare costs, because people simply do not control their weight and exercise -- maybe it's not that simple, but those are certainly components of it. What do we need to do to not only save money but to provide better outcomes for the American healthcare system?"

Changing the payment incentives would help, said Karen Joynt Maddox, MD, MPH, associate professor of medicine at Washington University in St. Louis, Missouri. "We have a system that pays more to do more, and not a system that pays more to keep people healthy. And until we change the payment structures to reward insurers, providers, and all of the parts of the healthcare system for keeping people healthy, we will continue to pay for sick care."

Possible diminution of services, including reproductive healthcare, is another potential issue with mergers, said Sen. Maria Cantwell (D-Wash.). She asked Chris Thomas, president and CEO of Community Hospital in Grand Junction, Colorado, whether he agreed with the idea that when religiously affiliated hospitals and other hospitals merge, they should publish a list of services that the hospitals provide or refuse.

"Yes, it is very concerning," he said. "We had that discussion in our community as we explored potentially joining a religious-affiliated organization ... We were looking at whether we should join a Catholic system or an Adventist system, and our community was very, very concerned about limitations on their health rights. And so as a board and as a hospital, we chose not to join [either] system."

But that doesn't mean healthcare institutions can't collaborate in other ways, Thomas said in response to a question from Sen. Tom Carper (D-Del.). "We had five oncologists decide to leave the other [local] hospital and join our facility," said Thomas. "We were not in the cancer business, and so I was pretty worried about having a cancer system. So we reached out to the Huntsman Cancer Center in Salt Lake City, Utah, and they were tremendous advocates for us, helping us set up that program, and so we have the best of the Huntsman Cancer Institute in Grand Junction, Colorado."

Of course, "there's no way we're going to be big enough to do bone marrow transplants and some of the most advanced cancer care, but with our partnership, we can get cancer care local, we can do chemotherapy, and we can do radiation therapy," said Thomas. "I think there are a lot of examples of those collaborations at work. We don't need to be purchased or become part of a system to achieve those gains."

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