Arnold Ventures: What’s Behind Out-of-Control Health Care Spending?

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Nearly 90% of U.S. metro hospital markets are highly concentrated, driven by policies favoring hospital acquisition of physician practices. This trend raises costs, reduces physician autonomy, and limits job options.

As of 2024, what proportion of physicians are employed by hospitals, health systems, or corporate entities?

1 in 4

2 in 5

4 in 5

None of the above

Medicare pays significantly more for the same service in hospital-owned clinics than in independent physician offices, driving up overall costs.

How much does an allergy skin test cost at a hospital-owned, off-campus outpatient clinic compared to $176.01 at a physician’s office?

$719.16

$504.32

$299.41

$176.01

Many medical services can be safely and effectively administered within a doctor’s office, but for years hospitals have been buying up physician practices, converting those practices into hospital outpatient departments, and charging patients more for the same services even when they’re still provided by the same doctor.

If Congress enacted comprehensive site-neutral payment reforms, how much would Medicare beneficiaries save in reduced premiums and cost sharing?

An average of $55 per year

An average of $114 per year

An Average of $100 per year

An Average of $217 per year

The U.S. has the highest prescription drug prices globally, driven by a lack of government intervention on high launch prices, anticompetitive behaviors extending government-issued monopolies, and a complicated payer system and supply chain that allows for market distortions. Current spending is $603 billion annually.

By 2028, what is prescription drug spending projected to reach?

$809 billion

$942 billion

$791 billion

$863 billion

Drug prices are too high. According to recent polling, what percent of voters noted having difficulty affording medications in the last 12 months, not taking them as prescribed, or simply not filling the prescription due to costs.

25%

45%

50%

60%

Americans are demanding action to address the high costs of drugs. While they overwhelmingly (75%) view both pharmaceutical companies and health insurance companies as responsible for these high prices, they are looking to Congress to take action.

What percent of voters say it is important that the government, as the largest purchaser of prescription drugs in the country, be able to negotiate the price it pays?

48%

56%

71%

90%

More than half of Medicare enrollees are now covered by Medicare Advantage (MA), run by private insurance companies. These companies are abusing the payment system and increasing costs for Medicare beneficiaries and taxpayers by billions of dollars every year.

MA plans were overpaid by $83 billion in 2024. How much was due to insurers’ coding practices alone?

$27 billion

$36 billion

$50 billion

$80 billion

Abusive and in some cases fraudulent billing practices by Medicare Advantage (MA) Insurers are well documented, yet these abuses continue to happen, costing billions in overpayments annually. These overpayments don’t just impact MA beneficiaries—they also increase the premiums that all Medicare beneficiaries pay.

All Medicare premiums were how much higher last year due to overpayments to MA insurers?

$5 billion

$13 billion

$18 billion

$25 billion

Primary care plays a critical role in keeping communities and families healthy, but for too long we have undervalued and underinvested in it. The way we pay PCPs places the volume of services over the quality of care and patient outcomes.

What is the predominant way we pay primary care physicians?

Population-based payments

Fee-for service

Both of the above

Neither of the above

Individuals covered by both Medicare and Medicaid, often referred to as “dual eligible,” face a fragmented, disjointed system that is challenging to navigate and often leads to worse health outcomes, higher costs, and increased frustration.

Dual eligibles make up 19% of the Medicare population and 13% of the Medicaid population, but account for more than what percent of the spending in both programs?

12%

22%

25%

30%