I think that's pretty unlikely to be honest - or at least easily avoided. There's enough reputable hosting providers out there (Amazon, Google, Microsoft, OVH, Digital Ocean, etc etc) that there isn't really any excuse for signing up with a provider who does MITM your VMs traffic.
That all said, I'm not excluding the possibility of providers logging network connections passively. The way around that is to run more than one VPN; that way any particular provider only has visibility of either the destinations but not the source, or the source but not the destinations. I'm not recommending that people need or should run two VPNs though - just adding it as a workaround against passive snooping by hosting providers.