Advisory
Real Affordability Solutions from the Front Lines of Caring
The issue of affordability is front and center for individuals and families across America. And health care affordability is a key part of that conversation.
As the backbone of the U.S. health care system, hospitals and health systems understand the importance of making sure high-quality care is affordable and accessible.
Across the country, hospitals are already changing how care is delivered to make it more affordable, accessible and centered on patients.
- Hospitals Are Providing Solutions to Improve Affordability
- What’s Driving Costs Across the Health Care System
- Hospitals Face Rising Costs of Caring for Patients
- Examples of How Hospitals Are Lowering Costs and Enhancing Value
- Videos: Clinicians Answer FAQs on Health Care Costs
Hospitals Are Providing Solutions to Improve Affordability
“As the backbone of our health care system, hospitals and health systems are committed to delivering high-quality, accessible and affordable care in every community,” said AHA President and CEO Rick Pollack. “But hospitals cannot solve affordability alone. It will require everyone — drug companies, commercial insurers, suppliers, government, patients and others — to fix our outdated system. The strategies outlined in this report are actionable, achievable steps that can help lower costs and strengthen access to care for Americans across the country.”
Specifically, strategies to make care more affordable include:
What’s Driving Health Care Costs?
More Patients with Greater Complexity
More people are seeking care, and they are increasingly sicker when they do — driving demand for higher-acuity services.
Health Care Is Inherently Human Work
Millions of trained nurses, doctors, and technicians deliver care that cannot be easily replaced by robots or AI.
Soaring Input Costs — Led by Drugs
Many drugs cost tens or hundreds of thousands of dollars per patient. Equipment, IT and cybersecurity costs are also rising rapidly.
Administrative Burden & Middlemen
Limitless insurance variation forces hospitals to spend billions simply to verify coverage, obtain authorizations and process claims.
Corporate Insurers Shifting Costs to Patients
High-deductible health plans and growing co-insurance requirements are pushing more of the financial burden directly to patients.
Inadequate Payment for Essential Services
Medicare and Medicaid pay below cost, and more than half of hospital costs tie to services where reimbursement falls short — including maternity care, behavioral health and pediatrics.
Hospitals Face Rising Costs of Caring for Patients
Hospitals are facing intense financial pressure as the cost of delivering care continues to climb:
- Hospital expenses are growing faster than payments, rising 7.5% in 2025—about twice the rate of price increases.
- Workforce accounts for more than half of hospital costs (60%), reflecting the need for highly skilled doctors, nurses and care teams.
- Critical inputs like drugs and supplies are surging, with hospital drug costs up 13.6% in a single year.
- Government payments fall short of the costs of caring for patients, with Medicare paying only 83 cents for every dollar hospitals spend, contributing to over $100 billion in government underpayments.
Examples of How Hospitals Are Lowering Costs and Enhancing Value
Hospitals in Action
Across the country, hospitals and health systems are changing how care is delivered to make it more affordable, accessible and centered on patients. Explore a few examples of the many ways that hospitals and health systems are working to make care more affordable for patients.
Videos: Clinicians Answer FAQs on Health Care Costs
Why am I getting a bill for a hospital visit when I have insurance?
Chris DeRienzo, M.D., chief physician executive and senior vice president at the American Hospital Association, explains why insurance billing can be confusing, with various factors affecting what you owe.
What if I can't afford my bill?
Claire Zangerle, DNP, R.N., senior vice president and chief nurse executive at the American Hospital Association (AHA) and CEO at the American Organization for Nursing Leadership (AONL), explains why you should contact your hospital if you can't afford your bill.
Key Resources
Statements to Congress on Affordability
Statement for April 28 Ways and Means Hearing with Health System CEOs
Statement for March 18 Energy and Commerce Subcommittee Hearing with Health Care Providers
Statement for Feb. 11 Energy and Commerce Subcommittee Hearing with Suppliers
Statement for Jan. 22 Energy and Commerce Subcommittee Hearing with Insurance CEOs
Setting the Record Straight
AHA Blog Responding to Essay in NY Times
AHA Responds to Families USA Report
AHA Blog Pushes Back on Paragon Report
WSJ Publishes AHA Letter to Editor on 340B Editorial
AHA Thought Leadership
Infographic: Making Health Care More Affordable
Blog: Hospitals Are Leading the Way to a Healthier America