LUGPA Policy Brief: Congressional Hearing Examines Vertical Integration, Prior Authorization, and Insurer Consolidation

March 2026

At-a-Glance

• What’s Changing: CEOs of the nation’s largest health insurers faced bipartisan scrutiny over vertical integration, prior authorization, claims denials, PBM practices, and executive compensation.
• Why It Matters: Lawmakers signaled growing concern that insurer consolidation is driving higher costs, limiting physician autonomy, and restricting patient access, core issues for independent urology practices.
• Key Takeaway: There is rare bipartisan momentum to examine and potentially regulate payer vertical integration, PBMs, and insurer business practices.
• What’s Next: Insurers must submit detailed data to Congress by late February; additional legislative and oversight activity is likely in 2026.

Overview

On January 22, 2026, the House Energy and Commerce Committee and the House Ways and Means Committee held more than nine hours of hearings with the CEOs of UnitedHealth Group, CVS Health, Elevance Health, Cigna, and Blue Shield of California’s parent company. Lawmakers from both parties sharply criticized insurer consolidation, prior authorization practices, and opaque financial arrangements across vertically integrated payer systems.

Members repeatedly questioned whether vertical integration, where insurers own PBMs, pharmacies, physician practices, and care delivery platforms, benefits patients or instead drives up costs while restricting access to care.

Vertical Integration Under Bipartisan Fire

Lawmakers focused on the rapid growth of vertically integrated health conglomerates, highlighting concerns that insurers increasingly control every step of the healthcare pipeline, from coverage decisions to drug pricing to care delivery.

Several members raised alarms that this consolidation reduces competition and disadvantages independent physician practices. UnitedHealth Group, which now employs or contracts with roughly 10% of the U.S. physician workforce and controls a significant share of the PBM market, drew particular scrutiny. Executives defended integration as improving coordination and efficiency, though lawmakers remained skeptical.

PBMs, Drug Pricing, and Specialty Care

Members cited a 2025 FTC report finding that the three largest PBMs marked up specialty generic drugs, often used for cancer and chronic conditions, by thousands of percent at affiliated pharmacies. These practices directly affect urology patients reliant on specialty oncology and injectable therapies and raise concerns about steering, site-of-care decisions, and access to independent practices.

Lawmakers also pressed insurers on offshore PBM group purchasing organizations and the lack of transparency around rebate and fee structures.

Prior Authorization and Claims Denials

Prior authorization practices were another flashpoint. Lawmakers challenged insurers’ claims that prior authorization requirements are declining, citing data showing high denial rates in specific marketplace plans. Physician groups, including the AMA, have stated that many practices have not seen meaningful relief.

For independent urology practices, these issues continue to contribute to administrative burden, delayed care, and increased practice costs.

ACA Subsidies, HSAs, and Market Stability

The hearings also addressed the expiration of enhanced ACA subsidies at the end of 2025 and competing proposals to replace subsidies with direct payments through health savings accounts (HSAs). Patient testimony underscored concerns that HSA deposits would be insufficient to offset rising premiums and out-of-pocket costs.

Insurers offered mixed responses on marketplace profitability, while lawmakers questioned whether profits are being shifted across subsidiaries within vertically integrated systems.

Why This Matters for LUGPA Members

These hearings reflect growing bipartisan concern that insurer consolidation, PBM practices, and vertical integration are undermining independent medical practices and patient access to care. The scrutiny aligns closely with LUGPA’s longstanding advocacy on:

• PBM reform and drug pricing transparency
• Prior authorization reform
• Opposition to excessive consolidation that disadvantages independent physicians
• Ensuring fair reimbursement and patient access to specialty care

What’s Next

Insurers committed to providing detailed data to Congress by the end of February on subsidiary spending, negotiated rates, and pharmacy dispensing practices. Lawmakers signaled that further oversight and potential legislative action could follow in 2026.

LUGPA will continue to monitor developments and engage policymakers to ensure reforms protect independent urology practices and preserve patient access to high-quality specialty care.