Illustration by Craig Gottwals – Attorney & RBP Expert
Aggressive billing strategies, remaining out-of-network, exploiting payment disputes to maximize revenue. misuse of the No Surprises Act, with a handful of private equity-backed providers and “IDR middlemen” routinely exploiting the law’s Independent Dispute Resolution (IDR)……
Health Care Costs 101: Health Care Prices Rise as Role of Private Equity Grows
Published Jan 21, 2026 • by AHIP
The growing role of certain private equity (PE)-backed providers in the health care sector – particularly within costly specialties – is one of the drivers of rising health care costs.
As families across the country struggle with health care costs rising far faster than wages or inflation, a growing body of research shows that the expanding role of certain private equity-backed providers within our health care system – from air ambulances, anesthesiology, radiology, oncology, physician and hospital-based services – is driving prices demonstrably higher with no corresponding gain in quality.
Research highlights the link between private equity-backed providers and rising costs:
A recent study found that between 2013 and 2022, 82 private equity firms acquired 423 cancer treatment practices across the country. The result? Radiation therapy prices jumped 50 percent at PE-backed facilities compared to independent practices, and chemotherapy costs rose by 28 percent.
The latest and most egregious examples have been the ongoing abuse and misuse of the No Surprises Act, with a handful of private equity-backed providers and “IDR middlemen” routinely exploiting the law’s Independent Dispute Resolution (IDR) process, also known as arbitration, to demand even higher payments from employers and health plans.
Estimates suggest this purposeful gaming of the arbitration system has added more than $5 billion in wasteful spending, driving premiums higher for employers and employees. Certain private equity-backed provider groups often rely on aggressive billing strategies, including remaining out-of-network or exploiting payment disputes, to maximize their revenue at the expense of American consumers.
A growing body of evidence underscores how the business strategies of some private equity-backed providers are resulting in higher costs for consumers. Out-of-network providers win more than 85 percent of arbitration cases, and the awards themselves are, in turn, significantly higher than in-network reimbursements. For example, through arbitration, one PE-backed practice has routinely secured awards exceeding $100,000 for a procedure that Medicare reimburses at $1,145.
Common-sense, bipartisan solutions to improve patient affordability
Health plans support meaningful and comprehensive solutions to address the abuse of the No Surprises Act arbitration system by certain private equity-backed providers and practices to pad their own profits at the expense of American patients. As policymakers discuss ways to address the affordability crisis, protecting consumers from abuses is critical to making coverage and care more affordable.
There are steps that policymakers can take immediately, including:
- Strengthening enforcement to ensure only eligible claims enter the IDR process;
- Requiring transparency in arbitration decisions, with clear rationale when awards deviate significantly from median in-network rates; and
- Penalizing serial abusers by limiting IDR access for organizations that repeatedly submit ineligible claims.
These common-sense solutions can provide relief to employers and consumers who are still bearing the brunt of private equity’s abuse of the surprise billing arbitration system.
To learn more about common-sense solutions to lower costs for everyone, click here.
Additional Information
Media Contact202.778.3200press@AHIP.org
