Why It Matters

The House Ways and Means Committee put the nation's largest hospital systems on the hot seat Tuesday, with Chair Jason Smith (R-MO) telling CEOs that "the prices you charge patients are borderline extortion." The April 28th hearing exposed a sharp partisan divide. Republicans trained their fire on hospital consolidation and inflated pricing, while Democrats aimed at the Medicaid cuts they say are pushing hundreds of hospitals toward closure.

The Big Picture

Tuesday's hearing was the second in a series by the Ways and Means Committee examining health care affordability. In January 2026, the committee heard from health insurance CEOs, who largely deflected blame onto hospitals and drug manufacturers. Now the committee turned the lens on the hospital sector itself. A parallel House Energy and Commerce Committee hearing in March also examined provider costs, suggesting a sustained congressional push on health care pricing heading into the 2026 midterms.

The Trump administration has simultaneously pursued hospital price transparency rules through the Centers for Medicare and Medicaid Services (CMS) as it also pushed the "One Big Beautiful Bill," which included more than $900 billion in Medicaid and ACA cuts, creating tension at the center of Tuesday's proceedings.

What They're Saying

Chair Jason Smith set the tone before witnesses spoke, delivering a series of statistics designed to indict the industry.

  • "Hospital prices have skyrocketed 300 percent in just over two decades, more than any other sector of our economy. Not one sector was even close."
  • "Hospitals with more than 100 beds have a higher profit margin than Delta Airlines, Disney, and Target."

Sam Hazen, CEO of HCA Healthcare, acknowledged the problem while defending his company. "Health care in this country has never been more advanced, but it is too expensive for too many people." He cited $4.5 billion in uncompensated care provided last year and blamed insurance prior authorization and care denials for driving up system costs.

Wright Lassiter III, CEO of CommonSpirit Health, offered a striking financial disclosure. His system carries $4.3 billion in unpaid Medicare Advantage claims, with roughly $1 billion more than 150 days old. "Hospitals are squeezed between increasing costs and challenges in being paid," he said. He also made a notable concession on site-neutral payments, a policy that would equalize Medicare reimbursements between hospital-based and independent outpatient settings: "There might be opportunities for modifications to the current site-neutral process." That was a break from the hospital industry's historically firm opposition.

Dr. Michael Waldrum, CEO of ECU Health, pushed back on the consolidation narrative with a rural lens. "The assumption that we are consolidating out of profit motives is wrong in rural America in our market. Our system grew because eight rural hospitals were failing and were about to be closed when those communities approached us." He added a pointed defense of hospitals' unique legal obligations. "We're the only participants in the healthcare value chain that have that obligation. Doctors, nurses, insurance companies, drug companies do not."

Brad Woodhouse, president of Protect Our Care, was the lone non-hospital voice and used it to go after Republicans directly. "Republicans gutted over $1 trillion from Medicaid and the Affordable Care Act to bankroll tax breaks for billionaires and big corporations." His organization characterized the hearing itself as a "sham."

The atmosphere turned testy. Rep. Gregory Murphy (R-NC) interrupted Woodhouse mid-response: "Pardon me, sir, but you're here to answer questions from the United States Congress about how to fix the very problem that you continue to advocate for." Murphy later called Woodhouse out directly for what he described as eye-rolling during a colleague's remarks. Woodhouse denied it. When asked by a Republican member whether he supported Medicare for All, Woodhouse refused a yes-or-no answer, prompting a dry "Nice answer" from the member. All four hospital CEOs answered the same question with a flat no.

Dr. Brian Donley, CEO of New York-Presbyterian, testified under a particular cloud. The Justice Department filed an antitrust suit against New York-Presbyterian earlier this year, alleging anticompetitive contracting practices that prevented insurers from excluding the system from preferred tiers, in alleged violation of the Sherman Antitrust Act. Donley declined to address the federal charges directly but argued New York City's competitive multi-system market explains its pricing dynamics. He was also pressed on reports that the hospital provides Chanel gift bags to maternity patients, which he said were donated by a company foundation to support a postpartum care program.

Political Stakes

For Smith, the hearing is a credibility test. He has made health care costs a signature issue of his Ways and Means chairmanship, appearing on CNBC before the hearing to call nonprofit hospitals "hedge funds with hospital beds." A STAT News report indicated that the CEOs "got off easy," suggesting the hearing generated more political pressure than concrete commitments. Smith's threat to cut Medicare payments to hospital systems is the most actionable signal, given Ways and Means' direct jurisdiction over Medicare payment rates.

For the administration, the hearing exposes a contradiction. The White House is simultaneously pressing hospitals on price transparency and advancing Medicaid cuts that hospitals say will force closures. Rep. Steven Horsford (D-NV) called the reconciliation bill "a betrayal" that gave "tax breaks to billionaires and big corporations at the expense of hardworking Americans."

The Other Side

Hospital systems put forward a unified counter-narrative, namely that their costs are rising too. Lassiter said labor alone has climbed more than 20 percent over five years and now represents 54 percent of CommonSpirit's operating expenses. Pharmaceutical and supply costs grew more than 10 percent last year. CommonSpirit said it has cut $3 billion in operating costs since 2019. The American Hospital Association urged Congress to "advance policies that lower costs without reducing access," a careful hedge against the Medicare payment cuts that Smith floated. Rural providers like Waldrum warned that one-size-fits-all federal payment reforms could shutter the very hospitals Congress says it wants to protect.

What's Next

The Ways and Means Committee scheduled a markup of several bills the day after the hearing. The committee's sequential hearing pattern, covering insurers in January and hospitals in April, suggests a pharmaceutical pricing hearing may follow. Smith's Medicare payment threat and Lassiter's comments on site-neutral reform are the two most likely pressure points for near-term legislative action.

The Bottom Line

Republicans and hospital CEOs broadly agree costs are too high. They disagree sharply on who is responsible and what comes next.

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