Private equity investment companies have been criticized in a recently released report by the Department of Health and Human Services (HHS) for their role in reducing patient healthcare quality and access and increasing patient costs.
Market consolidation and private equity investment could have fatal consequences in the healthcare industry, according to a report that fell a few days before Donald Trump seized the oval office.
According to one study cited in the report, private equity investment in nursing homes results in an 11% increase in patient deaths, while another study shows that inadequate competition in the healthcare market It has been revealed that it increases mortality rates in heart attack patients.
These issues are attributed in part to “active break-offs and inadequately qualified staff.”
The doctor, one commenter in the report, said that after her practice was acquired by Private Equity, she was “forced to see one medical assistant and 45 patients every day.” This was not safe… I was told on a daily basis by patients they had problems and had never heard of without calling… when I was wrong I knew I was going to go down.
The report was part of the Biden administration's “all government approach to promoting competition,” says Hannah Garden Monheit, director of Policy Planning under Biden. The HHS, the FTC and the Department of Justice all cooperated in this effort.
In particular, as of early February, news releases on the report appear to have been removed from the HHS website as part of the Trump administration's recent removal of federal health website.
Private equity companies investing in healthcare often reduce market competition and create local monopolies through “roll-ups” or “purchasing many practices that compete with each other,” explains Garden-Moneheit. “When you reduce competition, it creates space to raise prices and reduce wages.” Private equity companies that create hospital chains through independent hospital rollups often have “rescue” or “saving” hospitals. Trust yourself.
However, public comments on the report regarding private equity health investments show that these so-called rescue missions are deeply flawed.
“We were actually all sorts of surprises at the amount of spill we got,” Garden Monheit said.
The comments were negative, according to the report, saying, “Perhaps the most consistent comment was a comment that expressed dissatisfaction with a private equity-driven acquisition in healthcare.”
Garden-Monheit said of the commenters that healthcare workers in the system are best aware of the impact of private equity. For patients, it can be difficult to know that the facility has been acquired by private equity.
“(Private equity investors) don't announce that they've got something. They often keep the old names of the company. They do not like brain viruses and cancers in the body of this new company. “What is it?” Martin Kenny, senior project director at Berkeley Roundtable on the International Economy and author of Private Equity and Local End Mise, said:
Meanwhile, workers “recognize because they have a new management team. They have to do more work. The professionals are fired and the sub-professionals take over. In place of doctors, nurse practitioners, We have a doctor's assistant,” Kenny added.
The HHS report also found that private equity-backed companies frequently replace qualified workers with less qualified workers. One of her physical therapy assistants said that her private equity-owned hospital gives more time to unlicensed technicians, and fewer for licensed therapists and doctors, but also the same scrubs as licensed workers. He said he was dressed to unseen workers.
“This is an intentional fraud because patients, families and doctors think (unlicensed technicians) are licensed,” she said. According to the report, when she tried to express her concern, she was “threatened with a HIPAA violation for failing to follow the chain of command.”
Garden-Monheit is working to change disclosure and document requirements for patients who want to know if a medical facility is being acquired by private equity, while more information is available, “It's a work in progress,” he said. .
And so far the documentation can only go to solve the problem. Because in some places private equity has already taken over a certain medical industry and leaves no other options behind.
“I'm not shopping before I go to the emergency room,” she added. The emergency department is also a key goal for private equity.
Towards the end of the Biden administration, the FTC was beginning to chase private corporations for anti-competitive behaviour in the healthcare system.
“Thanks to the efforts of the current administration, we were actually beginning to decline in private capital interests in healthcare,” says Garden-Moneheit.
However, she is not sure if the progress will continue.
“It's really important to see what the new administration's approach is,” Garden Moneheit said.
“We could see private equity bonanzas that are truly dangerous for patients.”
