Private Equity and Health Care Delivery

Abstract

This Viewpoint considers how payment models may dictate the nature of private equity investment in health care delivery and how these investments may affect health care access, quality, equity, and affordability.

Private Equity and Health Care Delivery

“…To the Editor In their recent Viewpoint, Dr Powers and colleagues stated that studies about the influence of private equity on health care delivery are often conflicting. We disagree with this claim because evidence overwhelmingly points to increased costs to stakeholders, increased profits to owners, and only modest improvement in the reporting of process measures without any evidence of improved outcomes in health care delivered with private equity ownership.…”

“…Of the 5 references cited as current evidence in the Viewpoint, 4 of them raised concerns about generating unnecessary volume, overreliance on allied practitioners without proper supervision, self-referral, up-charging, delivering more low-complexity care (including screening colonoscopy), increasing short-term mortality of Medicare nursing home patients, declines in nursing home staff and compliance, and lack of transparency regarding ownership of practitioners and suppliers…”

Private Equity and Health Care Delivery

“…To the Editor In their recent Viewpoint, Dr Powers and colleagues claimed that value-based financial structures align care quality with profit motives. Empirical data contradict this argument and suggest that profit motives in health care result in lower-quality care, often at higher cost to taxpayers.…”

Private Equity and Health Care Delivery—Reply

“…In Reply In response to our Viewpoint, Dr Meier questions our hypothesis that value-based payment may mitigate potentially negative effects of private equity investment in health care delivery. Dr Luh and colleagues, along with Meier, also express concern that our description of the published evidence as “conflicting” is not accurate.…”

“…We agree with Meier and with Luh and colleagues that clear examples exists of unfavorable outcomes for patients and society associated with private equity ownership; we cited some of these examples in our Viewpoint . However, we do not believe that the evidence base is robust enough to support definitive conclusions about the effect of private equity on health care across specialties and sites of care, a view also articulated by the Medicare Payment Advisory Commission earlier this year…”