U.S. House lawmakers on Thursday pilloried the chief executives of the nation’s largest health insurance companies during a marathon day of testimony, demanding they justify multi-million dollar pay packages and rising care denials while American families struggle with “skyrocketing” premiums.
The CEOs of UnitedHealth Group, CVS Health, Cigna, Elevance Health, and Ascendiun faced back-to-back hearings before the House Energy and Commerce and Ways and Means committees. The sessions, described by some as a “no good, very bad day” for the industry, highlighted bipartisan frustration over the current state of U.S. healthcare affordability.
A central flashpoint of the hearings was executive pay. Rep. Buddy Carter (R-Ga.) challenged CVS Health CEO David Joyner over his alleged $41 million compensation, noting that such sums could “cover the premiums for thousands of American families.”
“How do you justify getting paid that much when so many of your patients struggle to afford skyrocketing premiums?” Carter asked.
Joyner responded by clarifying his earnings: “That was not my compensation you referenced. This past year, my compensation was $17 million, of which $1.1 [million] was my base salary. The rest is long-term incentives.” He added that he had returned his bonus last year to an employee relief fund. Carter, a former pharmacist, retorted, “I just met with some pharmacists out there who want to say, ‘You’re welcome.’ They helped pay your salary.”
Democratic Rep. Nanette Diaz Barragán (Calif.) criticized the industry’s reliance on performance bonuses, suggesting they incentivize prioritizing shareholders over patients. “Your constituents want to know why you make so much while they stretch every penny and dime to buy health care just to have the claim denied,” she said.
Lawmakers also took aim at care review practices and the frequency of claim denials. Rep. Kim Schrier (D-Wash.) cited a constituent who was allegedly denied hospitalization by UnitedHealth following a stroke, calling the incident “unconscionable and shameful.”
“This looks like your business model,” Schrier told UnitedHealth CEO Stephen Hemsley. “It looks like you bet on wearing patients down and them not appealing and then they either decide to just eat the cost or they die before they get the care they need.”
Executives defended their practices, arguing that they approve the vast majority of claims and that high costs are driven by other sectors. “The cost of healthcare insurance fundamentally reflects the cost of healthcare itself. It is more an effect than a cause,” Hemsley stated in prepared testimony.
The hearing also scrutinized vertical consolidation, specifically the ownership of pharmacy benefit managers (PBMs) by insurance giants. Rep. Alexandria Ocasio-Cortez (D-N.Y.) challenged Joyner on CVS’s market concentration through its PBM, Caremark, which manages roughly 30% of U.S. prescriptions.
When Joyner suggested the model “works really well for the consumer,” Ocasio-Cortez quipped: “I think it works very well for CVS. The health insurance gets a cut, the pharmacy benefits manager gets a cut, the drug manufacturer gets a cut. And the patient gets screwed.”
In a rare moment of industry self-critique, Paul Markovich, CEO of the nonprofit Ascendiun, admitted the current system is unsustainable.
“Our healthcare system is bankrupting and failing us,” Markovich said. “I’ve come to the conclusion that the system will not fix itself. The healthcare system needs some tough love and clear direction and the American government is in the best position to provide both.”
Despite the intense questioning, Wall Street appeared unswayed by the hearings, with shares of major insurers remaining largely flat or trending upward in post-market trading.