Lower Federal Spending by Cutting Unnecessary Health Care Costs, Not Coverage

New report highlights policy solutions to tackle soaring health care costs while preserving coverage and ensuring high-quality care for patients.

Washington, D.C  — In a report released today, Arnold Ventures makes the case that Congress can achieve significant savings while preserving coverage and high-quality care for patients. The U.S. health care system is broken, plagued by market consolidation, inflated prices, poor care coordination, and anti-competitive practices. These issues drive up costs, limit access, and lower quality – and American patients, families, and employers agree that the status quo isn’t working. 

The report offers five opportunities to achieve savings — totaling more than $1 trillion over 10 years— by addressing unnecessary spending across the system. 

“We recognize the pressure and importance of finding savings in health care, and there are significant opportunities to create greater efficiencies by addressing waste, fraud, and abuse across the system,” said Mark E. Miller, executive vice president of health care at Arnold Ventures. ​“And substantial savings can be generated without eliminating coverage.” 

With a focus on confronting entrenched special interests like hospitals, insurers, and pharmaceutical companies, Arnold Ventures’ policy solutions offer opportunities to reduce inefficiencies, save money for taxpayers, and lower out-of-pocket costs for consumers while protecting patients.

Key Highlights:

• Advance site-neutral payment reforms to equalize payments for low-complexity, routine services across all settings. Saving $157 billion over 10 years.
• Require site-of-service billing transparency to provide clarity about where care is being delivered. Saving $2.3 billion over 10 years.
• Extend drug price inflation penalties to include commercial plans. Saving $40 billion over 10 years. 
• Reduce the payment benchmark for Medicaid state-directed payments. Saving $120 billion over 10 years.

• Modify risk adjustment payments to Medicare Advantage insurers. Saving up to $1 trillion over 10 years.

“The policy solutions we outline eliminate the false choice of savings or coverage and offer a win for policymakers, taxpayers, and patients alike,” added Miller. 

Read the full report.