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Data: Whaley, et al., 2020, "Nationwide Evaluation of Health Care Prices Paid by Private Health Plans"; Cartogram: Andrew Witherspoon/Axios

Employers and private insurers paid hospitals, on average, 247% of what Medicare paid for the same services in 2018, per a new RAND study.

Why it matters: We all pay for this giant gap in prices through our premiums and lost wages.

The big picture: The price gap has been growing, with private insurers paying hospitals 224% of Medicare rates in 2016 and 230% in 2017. In 2018, prices were 267% of Medicare for outpatient services and 231% for inpatient services.

Between the lines: Prices varied drastically by location and by health system. Some states, including New York and Florida, paid more than 300% of Medicare rates, on average.

  • The most expensive system, John Muir Health, had prices that were 401.5% of Medicare. Sutter Health, which has settled a lawsuit brought by the state of California accusing the hospital system of price-gouging, was paid 326.6% of Medicare.
  • HCA Healthcare, one of the largest hospital systems, had prices that were 275.8% of Medicare. Community Health Network, another large health system that has continued to sue patients in coronavirus hotspots, was paid 260% of Medicare rates.

The other side: Hospitals have long argued that private insurance subsidizes inadequate government payment rate, and that they must charge privately insured patients more to make ends meet.

The bottom line: Hospitals make up the largest portion of overall health care spending. The pandemic may have momentarily distracted us from health care costs, but they're still high, and the pandemic's economic fallout has only made them more unaffordable for many Americans.

Go deeper

Dec 8, 2020 - Axios Events

Most employers didn't pay furloughed workers' health care premiums

Data: Bureau of Labor Statistics; Chart: Andrew Witherspoon/Axios

When the coronavirus forced businesses to tell their employees not to work, most kept paying at least some of those workers' wages — but not their health insurance premiums.

Why it matters: Millions of people have lost their income and their health care coverage at the same time during this pandemic, which could stick them with unaffordable medical bills or cause them to put off care they need.

Biden administration to lift travel ban for fully vaccinated international travelers

Photo: Win McNamee/Getty Images

White House COVID-19 response coordinator Jeff Zients announced on Monday that the Biden administration will allow fully vaccinated travelers from around the world to enter the U.S. beginning in November.

Why it matters: The announcement comes as President Biden seeks commitments from countries to donate vaccines to the global COVAX initiative. He is expected to host a COVID summit on the sidelines of the UN General Assembly this week, and many of the countries attending have expressed frustration with the travel ban.

Dan Primack, author of Pro Rata
1 hour ago - Economy & Business

Gen Z breaks into VC

Illustration: Aïda Amer/Axios

When Meagan Loyst joined VC firm Lerer Hippeau, less than two years out of Boston College, she was still living with her parents. She had virtually no online brand presence, and the pandemic made it impossible to build a professional network via in-person meetings.

Why it matters: Loyst wasn't alone. Venture firms have accelerated hiring in line with record deal activity, often seeking younger investors who can spot trends that fly below the radar (or intrinsic understanding) of older partners.