This would suggest that a significant percentage of the excess costs are going to medical innovation; instead at each step along the way (from hospital to insurer to reseller to medical device and pharmaceutical company) 15-30% is skimmed in admin and billing fees and other overhead.
It is a total myth that the US is either the sole innovator or the sole supplier of funding for medicine.
So who does fund significant medical research?
On the most part private institutions (think howard hughes medical institute) and universities and their endowments, and federal and state government grants.
There are significant research partnerships with pharmaceutical companies and they do spend huge numbers on R&D but significant quantities of this are iterative rather than truly innovative, which is work that is done more often by PhD's and postdocs as they have more to gain and less to loose by going out in a limb with their research.
And this research goes on in every country in the world.
The US may account for more than the rest of the world's aggregate defence spending but it is stretching it to suggest that the same is true for medical research.