Arnold Ventures: Congress Should Enact Health Reforms Over Harmful Cuts

Washington, D.C. (May 12, 2025) – Mark E. Miller, executive vice president of health care at Arnold Ventures, provided the following statement on the reconciliation process underway by Congress. 

“Right now, the U.S. House of Representatives is set to begin marking up legislation aimed at cutting billions of dollars from the federal budget. This process offers a critical opportunity to achieve meaningful savings without reducing essential benefits or harming vulnerable populations.

“To do this, Congress needs to look no further than unnecessary spending within the health care system. We at Arnold Ventures have outlined a number policy solutions Congress can look to for massive savings— totaling more than $1 trillion over 10 years.

“We encourage legislators to focus on confronting entrenched special interests like hospitals, insurers, and pharmaceutical companies, who have for too long been lining their pockets at the expense of patients, taxpayers, and employers.

“When advancing policies through reconciliation, Congress should prioritize proven, bipartisan reforms including reducing overpayments to private insurers in Medicare Advantage and enacting site-neutral payment reforms. Site-neutral reforms alone could save more than $150 billion over 10 years, while lowering Medicare beneficiary premiums and cost-sharing by more than $90 billion. Modifying risk adjustment payments to Medicare Advantage insurers would save up to $1 trillion over 10 years and reduce Medicare premiums.

“A good example is the Energy and Commerce Committee’s proposal to reform state-directed payments in Medicaid. In 2024, powerful industry groups scored a big win by convincing the Centers for Medicare & Medicaid Services to adopt commercial payment rates in Medicaid typically 200 – 300% higher than Medicare rates for hospital services. As a result of these changes, billions in taxpayer dollars are projected to be spent with minimal oversight or accountability. Congress has the opportunity to curb excessive spending on state-directed payments and align the limits across the entire Medicaid program, which could save up to $120 billion over 10 years.

“There is more than enough unnecessary, wasteful, and fraudulent spending across our health care system for Congress to make meaningful spending cuts without impacting coverage. We encourage policymakers to take notice of and take action on these opportunities.”