A new report from the National Alliance of Healthcare Purchaser Coalitions challenges several common narratives about hospital pricing and calls for stronger action to address rising healthcare costs for employers and workers.
To support these efforts, the DC-based nonprofit released an updated edition of its widely used resource, Setting the Record Straight: A Challenge to Align Hospital Prices with Value. The report breaks down what’s actually driving hospital costs and dispels widely circulated misconceptions such as the idea that prices reflect the true cost of care or that staffing shortages and inflation are the primary culprits.
“Employers deserve to have a clear understanding of what’s truly driving hospital costs,” said Shawn Gremminger, National Alliance president and CEO. “When employers have the facts, they can set expectations around fair pricing, transparency and value-based contracting to push hospitals to bring down unjustifiable prices that erode wages and raise premiums.”
The report highlights examples of coalition leadership, including the work of the Rhode Island Business Group on Health (RIBGH), which has helped employers better understand healthcare cost drivers and has brought attention to hospital pricing practices affecting Rhode Island businesses.
The updated report underscores that hospital prices far exceed Medicare benchmarks, not because of inflation, patient demand, or labor costs, but due to consolidation, market power, and a lack of transparency. These rising prices intensify healthcare inequities and disproportionately strain lower‑income communities.
Hospital consolidation and anticompetitive contracting practices continue to limit employer choice and fuel unsustainable price growth. As a result, employer-sponsored coverage—which insures most working Americans—is becoming increasingly difficult to afford.
As healthcare consumes a larger share of total compensation, fewer resources remain for wages, innovation, and workforce investment, undermining the competitiveness of American businesses and workers’ financial security.
As these trends will persist without meaningful price reform and greater accountability, the National Alliance encourages employers and other healthcare purchasers and policymakers to use this updated resource to push for meaningful transparency, accountability, and fair pricing across hospital systems.
Read the full report here.