This series ran in 2022 but I am linking to stories that most of you won't have read, and should.
• Patients for Profit: How Private Equity Hijacked Health Care (KFF Health News) Private equity investors are rapidly scooping up thousands of health care businesses, taking over emergency rooms or entire hospitals, and becoming major players in physician practices and patient care, from cradle to grave. But these acquisitions are often invisible to federal regulators. And their profit motives raise concerns about rising prices and the quality of treatment.
• Sick Profit: Investigating Private Equity’s Stealthy Takeover of Health Care Across Cities and Specialties (Fred Schulte, KFF Health News, 11-14-22) Private equity firms have shelled out almost $1 trillion to acquire nearly 8000 health care businesses, in deals almost always hidden from federal regulators. The result: higher prices and complaints about care. Government should require 'added scrutiny' of private equity companies whose holdings run afoul of the law.
• Baby, That Bill Is High: Private Equity ‘Gambit’ Squeezes Excessive ER Charges From Routine Births (Rae Ellen Bichell, KFF Health News, 10-13-22) Routine births are turning into moneymaking ‘emergency’ events at hospitals that work with private equity-backed staffing companies. Federal regulators, meanwhile, are almost blind to the incursion, since private equity typically acquires practices and hospitals below the regulatory radar. KHN found that more than 90% of private equity takeovers or investments fall below the $101 million threshold that triggers an antitrust review by the Federal Trade Commission and the U.S. Justice Department. In the health care sphere, private equity has tended to find legal ways to bill more for medical services: trimming services that don’t turn a profit, cutting staff, or employing personnel with less training to perform skilled jobs — actions that may put patients at risk, critics say.
• Sick Profit: Investigating Private Equity’s Stealthy Takeover of Health Care Across Cities and Specialties (Fred Schulte, KFF Health News, 11-14-22) As private equity extends its reach into health care, evidence is mounting that the penetration has led to higher prices and diminished quality of care, a KHN investigation has found. KHN found that companies owned or managed by private equity firms have agreed to pay fines of more than $500 million since 2014 to settle at least 34 lawsuits filed under the False Claims Act, a federal law that punishes false billing submissions to the federal government with fines. Most of the time, the private equity owners have avoided liability.
• Hospices Have Become Big Business for Private Equity Firms, Raising Concerns About End-of-Life Care (Markian Hawryluk, KFF Health News, 7-29-22) With the U.S. population rapidly aging, hospice has become a boom industry. And with limited oversight and generous payment, the industry is at high risk for exploitation. Agencies are paid a daily rate for each patient, which encourages for-profit hospices to limit spending to boost their bottom lines. For-profit hospices had Medicare profit margins of 19% in 2019, compared with 6% for nonprofit hospices. For-profit hospices tend to hire fewer employees than nonprofits and expect them to see more patients. If patients become too costly, requiring expensive care or medicines, hospice providers can discharge them, and take them to a hospital emergency room to get services the agencies don’t want to pay for themselves.
• Infections and falls increased in private equity-owned hospitals (National Institutes of Health, 1-23-24) Local hospitals might be owned by the university next door, by a non-profit organization, or by a for-profit company. Over the last decade, more and more hospitals have been purchased by private equity firms.The private equity model involves using investor money—and additional debt—to purchase an asset like a hospital. The firm typically then cuts operating costs, often sells the real estate portion, and attempts to re-sell the entity for a profit after several years. Hospitals saw a 25% increase in hospital-acquired conditions after acquisition by private equity firms relative to the control group. This increase was mainly driven by a spike in infections after the placement of a central line (a type of IV inserted near the heart to deliver drugs, fluids, or other substances) and an increase in falls. Private equity acquisitions led to higher charges, prices, and societal spending and a decline in the clinical quality of care delivered to hospital patients.