Dr. Oz pledges in confirmation hearing to continue Medicare drug price talks started by Biden

Former heart surgeon and television host Dr. Mehmet Oz testified Friday before the Senate Finance Committee over his nomination to head the Centers for Medicare and Medicaid Services under President Trump.

The GOP-led committee will next schedule a vote on whether to send Oz’s nomination to the full Senate, where he is likely to be approved given the Republican majority. 

If confirmed, Oz would be the administrator charged with overseeing the nearly $1.5 trillion spent by the federal government on Medicare and Medicaid. The two health insurance programs for seniors and poor Americans make up more than a third of the budget. 

Medicare covers around 65 million people, through programs run directly by the federal government or contracted out to private insurers. Medicaid supports around 85 million, through programs administered primarily by state governments overseen by CMS.  

CMS also sets rules that affect private health insurance, including overseeing the Affordable Care Act’s health insurance marketplaces.

Oz previously worked as a professor of cardiac surgery at Columbia University and host of “The Dr. Oz Show” until 2022, when he stopped taping new television episodes to run for a Senate seat in Pennsylvania. He lost that Senate race to Democrat John Fetterman, in a narrow contest where abortion had ranked as a top issue for voters.

Oz’s priorities for Medicare and Medicaid

Oz outlined a vision for the agency focused in large part on modernizing its systems and tools, addressing waste and fraud and incentivizing Americans to make healthier lifestyle choices.

“Some of these decisions are not difficult. Some of them need to be simplified. And some of them need to be reminded frequently,” Oz told senators of the healthier lifestyle choices he wants to encourage, adding later that “the idea of giving incentives to patients is an idea that I think is a worthy one, especially for Medicaid beneficiaries.”

It will be up to Oz to finalize or abandon some major changes to Medicare and Medicaid sought by the Biden administration, like a pricey proposal in November to expand coverage to drugs used for weight loss like Wegovy and Ozempic.

Oz did not directly address the proposal during the hearing. But he did promise to continue the Medicare drug price negotiation program launched by the Biden administration, from the Inflation Reduction Act.

“It’s the law. I’m going to defend it and use it,” Oz told senators.

He also voiced support for allowing states to add work requirements in Medicaid. Oz also said he wants work requirements to be defined broadly, to include activities like going to school or volunteering at a church.

“I don’t think you need to use paperwork to prove a work requirement. And I don’t think that should be used as an obstacle, a disingenuous effort to block people from getting on Medicaid,” he said.

Oz criticizes Medicare Advantage

During Friday’s hearing, Oz singled out Medicare Advantage as one of the biggest sources of waste and abuse within the insurance industry.

Just over half of seniors have opted for these plans offered by private insurers but paid for by taxpayers, according to the latest federal data, instead of “original Medicare” coverage.   

He cited reports showing spending on the private alternatives outpacing traditional Medicare coverage as “upside down” what it should be, questioning spending by plans and efforts by brokers to persuade seniors to sign up.

He also criticized the practice of “upcoding” within Medicare Advantage, where providers or plans bill for treating patients as sicker than they actually are.

“A part of this is just recognizing there’s a new sheriff in town. We actually have to go after places and areas where we’re not managing the American people’s money well,” Oz said.

Oz calls for limiting prior authorization

Oz also faced questions over the significant authority he would wield over private health insurance.

On Monday, CMS proposed making several moves to reverse Biden administration expansions to the insurance marketplace created by the Affordable Care Act, like shortening the open enrollment period and excluding DACA recipients from coverage. In 2022, Oz said that the law “caused havoc on our health care system” and that he “wouldn’t have voted for it.”

During the hearing, Oz criticized health insurance companies misusing prior authorization – sometimes delaying treatment until doctors and patients can persuade insurers that it is necessary – as “a pox on the system.” 

“We’re spending money, wasting money, trying to do a process that should be automated. I would argue we could limit the number of preauthorized procedures to a thousand,” he told senators.

Republicans optimistic Oz will be confirmed

In social media posts last month, Oz has touted “great conversations” with key Republicans he would need to win over for his nomination. Multiple Republicans at Friday’s hearing said they were optimistic Oz would be confirmed.

Sen. Bill Cassidy of Louisiana, the Republican chair of the Senate’s health committee, was among those to sit down with Oz last month. Cassidy is one of four medical doctors in the Senate. 

“Great meeting with Dr. Mehmet Oz, President Trump’s nominee to lead the Centers for Medicare & Medicaid Services. It will be great to have a doctor in charge,” Cassidy posted on Feb. 5.

Oz was the fourth of Trump’s health official picks to face questioning from senators. It comes a day after a hearing for Dr. David Weldon was abruptly canceled, after the White House withdrew his nomination to head the Centers for Disease Control and Prevention.

A majority of senators on the Senate’s health committee advanced Dr. Jay Bhattacharya, the president’s nominee to head the National Institutes of Health, and Dr. Marty Makary, the pick to head the Food and Drug Administration, on Thursday.

Oz’s potential new supervisor, Health and Human Services Robert F. Kennedy Jr., was narrowly confirmed by the Senate a month ago.

Democrats criticized Oz’s past

Sen. Ron Wyden of Oregon, the top Democrat on committee, during the hearing accused Oz of “dodging Medicare and Social Security taxes.” Wyden said a tax loophole has “benefited Dr. Oz by $440,000 in the last three years.” 

During the hearing, Oz did not respond to the allegation. A memo from the committee’s Democratic staff had concluded that Oz may have underpaid his taxes based on a questionairre he submitted, his tax returns and financial disclosures.

“Now, the doctor will testify about his concern for Medicare’s well being, yet he is unwilling to pay the same taxes that millions of Americans pay out of every paycheck,” Wyden said. 

The president’s pick to head CMS has earned criticism from some Senate Democrats for months, who have cited Oz’s past embrace of “alarming pseudoscience,” record of anti-abortion statements and worries over conflicts of interest.

As part of an ethics agreement published last month, Oz said he will resign from positions at several companies, including the nutritional supplement company iHerb and the drugmaker Housey Pharma. He also pledged to divest from several healthcare companies, including insurance giant UnitedHealth Group.

After the Senate race, Oz had been advertised as iHerb’s global advisor. He continued to promote iHerb’s supplements on social media after his nomination.

He has also continued to republish past excerpts from his show in recent years after the Senate race, like a clip he shared on Sept. 4 from a sponsored interview about Medicare Advantage coverage. In 2020, Oz would later propose that Medicare Advantage should be expanded to all Americans. 

In the clip, Oz said that enrollment in Medicare Advantage had grown 70% since he started his show. 

“I want to nudge you. I don’t want to shove you. But think about this, because a 70% increase since I started the show means a lot to me,” he said.

contributed to this report.