Mark Cuban Calls Healthcare Pricing ‘Horrific’– Says Hospitals and Doctors Are ‘Sub Prime Lenders’ Forced To Raise Prices To Cover Losses

Mark Cuban Calls Healthcare Pricing ‘Horrific’– Says Hospitals And Doctors Are ‘Sub Prime Lenders’ – But He’s Proposing A Way To Fix Things

Mark Cuban isn’t holding back when it comes to his thoughts on the U.S. health care system. On Bluesky, on Dec. 10, he laid out exactly why he thinks the system is broken and how he’s taking steps to fix it.

His biggest gripe? Hospitals and doctors are being forced into the role of “Sub Prime Lenders” because they bear 100% of the credit risk for unpaid deductibles, co-pays and coinsurance. “That’s insane,” he wrote, adding, “When they can’t collect payment, they raise prices to make up that loss.” According to him, this leads to the “horrific” health care pricing.

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The ripple effects don’t stop there. According to Cuban, hospitals have to function like mortgage loan servicers, navigating a maze of administrative costs to collect those unpaid amounts. This cycle pushes many patients into medical debt, which often leads to bankruptcy. In Cuban’s eyes, this isn’t just inefficient – it’s a humanitarian disaster.

Insurance companies aren’t getting a free pass in his critique, either. Cuban states that for over 50 million Americans under such plans, insurers don’t provide traditional insurance. Instead, they function as “care authorizers and payment processors,” determining the approval and cost of care, with a primary focus on preventing fraud and assessing medical necessity.

Data from Statista indicates that in 2023, approximately 65% of U.S. workers were enrolled in self-funded health insurance plans, where employers assume direct financial responsibility for employees’ medical claims.

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Cuban doesn’t think this role should fall to insurers at all. “That authorization process is one we should not be asking ins comps to do,” he argued. Instead, he believes independent third-party administrators (TPAs) with no financial incentives to approve or deny care should handle this process. “The first step,” he said, “is for self-insured entities to use third-party TPAs and move away from insurance companies for this service.”