High Hospital Costs Make Us Sick, Drive Inequality in Health Care

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For Immediate Release
Contact: Mike Roth 916-444-7170

High Hospital Costs Make Us Sick, Drive Inequality in Health Care

Health consumer and equity advocates blast pro-price gouging hospital lawsuit

SACRAMENTO, CA – The California Pan-Ethnic Health Network (CPEHN) and Health Access California slammed a lawsuit filed today by the California Hospital Association seeking to halt California’s landmark measures to make health care more affordable for Californians and reduce health disparities. Leading advocates for health consumers and health equity, both organizations supported SB 184 (2022) that created California’s Office of Health Care Affordability (OHCA) and both organizations’ executive directors serve on the panel that advises OHCA on spending targets and equity metrics.

“California hospitals,which have some of the highest hospital prices in the nation, are making Californians sick, and driving disparities in health outcomes for communities of color. Price gouging health care consumers doesn’t make health care better or more equitable, it only makes it more likely people will skip or delay care leading to poorer health outcomes, all in order to put more profits in corporations’ balance sheets,” said Kiran Savage-Sangwan, CPEHN Executive Director. “This outrageous lawsuit isn’t about quality care, it’s intended only to prop up excessive executive compensation and hospital profits. It’s shameful that the hospital industry is hiding behind the issue of systemic health disparities in order to justify their excessive profits, which are keeping health care prices out of reach for Californians. Californians are facing rising premiums and loss of health coverage as a result of the Republican action to slash federal health care programs. California must take action to protect our most vulnerable residents from Trump policies. Making health care more affordable by reining in corporate greed is a health equity imperative. CHA should side with Californians over billionaires and commit to real action to tackle the health care crisis.”

“California’s Office of Health Care Affordability is a landmark achievement for health care consumers. OHCA’s 3% spending growth target was developed following many years of work by the state legislature, the administration, learnings from cost commissions in other states, academic research on health care costs, and public testimony from thousands of Californians. To say this was not a thorough process is simply untrue,” said Amanda McAllister-Wallner, Executive Director of Health Access California. “For years, health care costs have vastly outpaced inflation and wage growth, with very little to show for it – our higher costs don’t translate to better quality of care, outcomes, equity, or access. What high health care costs have led to is consumers skipping care or taking on debilitating medical debt. That’s why the state created OHCA and very thoughtfully set a spending target that aligns with consumers’ ability to pay. This lawsuit is a blatant attempt to try to change the rules of the game after the fact because you don’t like the outcome.”

The facts on hospital prices are clear:

  • California is home to some of the highest priced hospitals in the country. A national study found that 11 of the 19 highest priced hospitals were in California, including eight in Northern California which on average charged almost three times what Medicare pays (Health Affairs).
  • High hospital prices prevent Californians from accessing health care. A 2024 California Health Care Foundation poll found, “Health care costs and medical debt are making Californians sicker. More than half of Californians (53%) say they skipped or postponed care due to cost in the last year — a number that rises to a startling three of four when it comes to Californians with low incomes (74%). This is leading to greater health challenges, as more than half of those who skipped care (54%) say their condition got worse as a result.
  • High hospital prices leave Californians in debt. The 2024 CHCF poll reported “Meanwhile, close to 4 in 10 Californians (38%), and over half of those with low incomes (52%), say they are carrying medical debt, with nearly one in five owing $5,000 or more.” Black, Latine, and Spanish-speaking Californians disproportionately face medical debt.
  • High hospital prices drive inequity. Lack of affordability has resulted in poorer health outcomes, particularly for communities of color. People who are Black (67%) or Latine (53%) were more likely to skip or delay care than those who are White (47%) or Asian (35%). Of those who skipped or delayed care, more than half say their condition got worse as a result.
  • Market consolidation and profits drive healthcare prices higher but don’t result in greater care. According to the California Health Care Foundation report, The 25% Problem: Why Health Care Is So Expensive (And What We Can Do About It),“around 25 cents of every dollar in our health care system doesn’t help patients get better care or become healthier. In 2020, it was estimated that this added up to as much as $73 billion dollars a year in California’s health care system.” This 25% includes the excessive profits attributed to market consolidation.

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About the California Pan Ethnic Health Network
The California Pan Ethnic Health Network brings together and mobilizes communities of color to advocate for public policies that advance health equity and improve health outcomes in our communities. Learn more at cpehn.org.

About Health Access California
Health Access California is statewide health care consumer advocacy coalition, working with a broad range of diverse organizations seeking affordable, equitable and quality health care for ALL Californians. Learn more at health-access.org.