From “Serious Medical Errors Rose After Private Equity Firms Bought Hospitals,” reported by the NYT:

The study, published in JAMA on Tuesday, found that, in the three years after a private equity fund bought a hospital, adverse events including surgical infections and bed sores rose by 25 percent among Medicare patients when compared with similar hospitals that were not bought by such investors. The researchers reported a nearly 38 percent increase in central line infections, a dangerous kind of infection that medical authorities say should never happen, and a 27 percent increase in falls by patients while staying in the hospital.

“We were not surprised there was a signal,” said Dr. Sneha Kannan, a health care researcher and physician at the division of pulmonary and critical care at Massachusetts General Hospital, who was the paper’s lead author. “I will say we were surprised at how strong it was.”

// 12.26.23

People like to operate under the belief that services like anesthesia, radiology, and pathology are totally interchangeable commodities. We do the work but don’t generate it, and patients generally don’t get to pick.

But in the real world, labor isn’t as cog-like as you might think, and culture matters (yes, even in our dysfunctional healthcare system).

Here, enjoy this story of a failed private equity anesthesia takeover.

// 12.12.23

Great reporting by Cezary Podkul in ProPublica (and amazing perseverance by Dr. Shteynshlyuger):

A powerful lobbyist convinced a federal agency that doctors can be forced to pay fees on money that health insurers owe them. Big companies rake in profits while doctors are saddled with yet another cost in a burdensome health care system.

// 08.16.23

I’ll be giving the keynote at the FSU College of Medicine’s Business & Medicine Symposium in Tallahassee this Saturday. If you’re a student there, make sure to come say hi during the morning coffee or lunch after!

// 08.15.23

From MONETIZING MEDICINE: PRIVATE EQUITY AND COMPETITION IN PHYSICIAN PRACTICE MARKETS, a report by the American Antitrust Institute:

Price increases associated with PE acquisitions are exceptionally high where a PE firm controls a competitively significant share of the local market. When we focus our analysis on markets where a single PE firm controls more than 30% of the market, we find further elevated prices associated with PE acquisitions in each of the 3 specialties with statistically significant results, for gastroenterology (18%), obstetrics and gynecology (16%), and dermatology (13%).

Discussed in the NYTimes here.

// 07.13.23

Jeff Goldsmith in “What Can We Learn from the Envision Bankruptcy?“:

Strategically, the Envision bankruptcy raises anew the question of whether there are economies of scale, and investment returns to scaling, in healthcare. Certainly the conventional wisdom argued that large firms like Envision had the ability to recruit and retain clinicians across vast geographies, and negotiating power with the large insurers that increasingly dominate key insurance sectors like Medicare Advantage and Managed Medicaid.

Envision’s demise strongly suggests that the power balance-both political and economic- has tipped decisively in the direction of payers like United. Rising interest rates, the increasing scarcity of clinicians as workaholic baby boom vintage docs and deepening financial challenges for the ultimate customers of many of these companies, namely hospitals, suggest that we may have reached an inflection point in the viability of many private equity physician care models, with their 4-7 year holding periods and a succession of owners. Current owners might find it increasingly difficult to exit their positions.

// 07.11.23