Input Stories

Ahead of two hearings focused on health care affordability, the NAM laid out manufacturers’ policy solutions to reduce health care costs for manufacturers, their workers and their families.

The hearings: The House Committee on Ways and Means and the House Energy and Commerce Subcommittee on Health each held a hearing with the CEOs of major health insurance companies as witnesses on Jan. 22. House Ways and Means Committee Chair Jason Smith (R-MO) summed up the reason for the hearings in his opening statement, stating, “patients are forced to navigate systems designed around insurer priorities, not patient needs.”

Why manufacturers care: Seventy percent of manufacturers cited health care and insurance costs as a primary business concern in the NAM’s most recent Manufacturers’ Outlook Survey.

• Ninety-four percent of manufacturers also said that they expected, or had already seen, an increase in health insurance premiums for 2026. Of those, 11% see premiums rising by more than 20%, an unsustainable increase that neither manufacturers nor manufacturing workers and their families can afford.

What’s needed: To address the steep and sustained increase in health care costs, the NAM recommended that policymakers focus on certain reforms, including the following:

• PBM reform: Pharmacy benefit managers, the unregulated middlemen that negotiate and administer drug benefits for health insurance companies and self-funded employer plans, have long driven up the costs of medicine by pocketing manufacturers’ rebates and engaging in other questionable business practices. Necessary reforms include increasing transparency requirements, delinking PBM compensation from the list price of medicines and instituting full rebate passthrough to plans and their beneficiaries in the commercial market. PBM reforms were included in the House-passed government funding bill, which awaits consideration in the Senate.
• 340B program reform: The 340B program was created to lower costs for underserved and low-income patients, but has expanded far beyond Congress’ intent. The 340B program allows certain hospitals and clinics to buy drugs at lower prices, but when patients with health insurance through their employer receive those drugs, their insurance is charged the full price and patients and employers lose out on negotiated rebates. Reforms are needed to return the program to Congress’ original intent and put more money in the pockets of manufacturers.
• HSA expansion: Congress should consider expanding eligibility and contribution limits for health savings accounts, tax-free savings accounts that patients with certain health insurance plans can use to pay for out-of-pocket medical costs. Expanding eligibility and contribution limits for HSAs would help more Americans pay their out-of-pocket health care costs tax-free.

Other recommendations: The NAM also recommended ways to help manufacturers continue to offer health benefits to their workers, including incentivizing the adoption of individual coverage health reimbursement arrangements (which allow employers to make tax-free reimbursements to employees for qualified medical expenses without providing traditional group health insurance), codifying association health plans (which allow small employers to join together to offer employer-sponsored health plans at lower costs than they could individually) and improving data transparency and accessibility for employer plan sponsors.

• The NAM also urged policymakers to strengthen the Employee Retirement Income Security Act of 1974 and protect its federal preemption so manufacturers can continue to provide consistent, yet tailored, benefits across many states.

The last word: “Manufacturers and their workers are increasingly concerned with the rising cost of health care,” said NAM Director of Health Care Policy Jess Wysocky and NAM Vice President of Domestic Policy Jake Kuhns. “Congress must act to reduce health care costs so that manufacturers can continue to offer health insurance to their workers, and their families, who work hard every day to power the American economy.”