Complications spiked 25% in hospitals bought by private equity

[TheLoneWolf]

In a surprise to no one.

Like the study that showed a higher complication rate with higher anesthesia supervision ratios.

Complications spiked 25% in hospitals bought by private equity

Adverse events at hospitals like falls and infections spiked 25% after private equity took over, a new study found.

www.statnews.com

As a fellow, I had rotated at a massive children's hospital, probably biggest and highest level of peds care in the state. Inner city. Rough neighborhood surrounding it. Recently bought by a private equity firm a few years previously.

Nurses and attending staff said everything had taken a nosedive since then. Staffing, replacing broken/damaged equipment, staff benefits, even standard meds and bedside equipment post cardiac surgery was becoming more limited. That last point had remained with and continues to unsettle me.

From a purely economic standpoint, I don't understand it. A mostly medicaid population in a blighted area. Where do the investors think they can squeeze consistent returns out of it?

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[amyl]

What other PE owned hospital groups are out there besides HCA? That’s the only one I know of

 

[SRYSPAC]

In a surprise to no one.

Like the study that showed a higher complication rate with higher anesthesia supervision ratios.

Complications spiked 25% in hospitals bought by private equity

Adverse events at hospitals like falls and infections spiked 25% after private equity took over, a new study found.

www.statnews.com

As a fellow, I had rotated at a massive children's hospital, probably biggest and highest level of peds care in the state. Inner city. Rough neighborhood surrounding it. Recently bought by a private equity firm a few years previously.

Nurses and attending staff said everything had taken a nosedive since then. Staffing, replacing broken/damaged equipment, staff benefits, even standard meds and bedside equipment post cardiac surgery was becoming more limited. That last point had remained with and continues to unsettle me.

From a purely economic standpoint, I don't understand it. A mostly medicaid population in a blighted area. Where do the investors think they can squeeze consistent returns out of it?

Which "massive" children's hospital is this?

 

[TheLoneWolf]

What other PE owned hospital groups are out there besides HCA? That’s the only one I know of

Not HCA

 

[TheLoneWolf]

Which "massive" children's hospital is this?

Would rather not give away my location. I'm sure you could respect that

 

[SRYSPAC]

I can totally understand that; happy to discuss via PM. I am a fellowship-trained peds doc, and would be happy to know where to avoid should I ever consider moving, though I don't foresee that at all. My current mixed adult/peds practice is hiring a peds doc in case you and anyone here is looking to move to the Tampa area

 

[Arantius]

What other PE owned hospital groups are out there besides HCA? That’s the only one I know of

HCA is publicly traded not PE. Different

 

[amyl]

Ah ok. Originally PE w Bain capital and now publicly traded- right?

 

[Arantius]

Ah ok. Originally PE w Bain capital and now publicly traded- right?

I think so- I only know because it’s in my portfolio and consistently does well on the ticker

 

[abolt18]

 

[TheLoneWolf]

I like the wording. Straight to the point. Is private equity akin to termites gobbling up the rotten structure that is the modern american healthcare juggernaut?

 

[IlDestriero]

There are several children’s hospitals in terrible locations with a very high Medicaid base that have no value. Constant money losers. Why PE would have any interest in one of them is beyond me. They’re not going to negotiate better rates, they’re not going to balance bill anyone, and they aren’t going to “right the ship” and find tens of millions in waste. They’re just going to strip mine it and leave it hopelessly wrecked.

 

[coffeebythelake]

The Death of Hahnemann Hospital

When a private-equity firm bought a Philadelphia institution, the most vulnerable patients bore the cost.

www.newyorker.com

 

[PainDrain]

I can’t fathom how anyone, and by anyone I mean government regulators, Congress, the general public, etc; can justify the existence of “private equity.” The PE folks would say they cut costs and make businesses more efficient but history does not show that to be the case. PE typically loads their acquisition up with debt and siphon off the money. The PE firms typically cuts costs and sell off what they can at a profit and (no surprise) often times declare bankruptcy after they can steal all the value out of a company. A hospital system I know of is going through a PE-induced disaster and several departments in the system are in turmoil. The PE firm is not meeting its financial obligations that are required by state law and I think their goal is to force the state to step in and walk away with their profits.

 

[coffeebythelake]

I can’t fathom how anyone, and by anyone I mean government regulators, Congress, the general public, etc; can justify the existence of “private equity.” The PE folks would say they cut costs and make businesses more efficient but history does not show that to be the case. PE typically loads their acquisition up with debt and siphon off the money. The PE firms typically cuts costs and sell off what they can at a profit and (no surprise) often times declare bankruptcy after they can steal all the value out of a company. A hospital system I know of is going through a PE-induced disaster and several departments in the system are in turmoil. The PE firm is not meeting its financial obligations that are required by state law and I think their goal is to force the state to step in and walk away with their profits.

At best this is a zero sum game. Private equity is legalized theft

 

[GravelRider]

I can’t fathom how anyone, and by anyone I mean government regulators, Congress, the general public, etc; can justify the existence of “private equity.” The PE folks would say they cut costs and make businesses more efficient but history does not show that to be the case. PE typically loads their acquisition up with debt and siphon off the money. The PE firms typically cuts costs and sell off what they can at a profit and (no surprise) often times declare bankruptcy after they can steal all the value out of a company. A hospital system I know of is going through a PE-induced disaster and several departments in the system are in turmoil. The PE firm is not meeting its financial obligations that are required by state law and I think their goal is to force the state to step in and walk away with their profits.

There is nothing that we can do to stop PE unless we can miraculously have a functioning legislature…which is not going to happen in our current political moment. They exploit every legal loophole and law that is meant to allow free enterprise and encourage business creation in order to extract wealth from preexisting business. They are basically the equivalent of the parasites of the business world.

 

[circleK]

And they hit all the industries where they can prey on people who have no other choice: hospitals, prisons, nursing homes, rehab facilities, payday loan services. It’s so morally bankrupt and infuriating.

 

[neutro]

Hospitals are dumb also

They’re the ones engaging with PE

Why don’t they actually sit with the physicians and figure out what’s fair and reasonable

PE is not tied to the communities - hospital and docs who raise their families are

 

[nimbus]

https://www.sciencedirect.com/science/article/pii/S2949916X2400001X