Health care and private equity
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What happens when you allow private equity goons to buy healthcare facilities so that they can burden them with debt, hoping to slash expenses and sell for a quick profit? Precisely what you’d expect:
The rate of serious medical complications increased in hospitals after they were purchased by private equity investment firms, according to a major study of the effects of such acquisitions on patient care in recent years.
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.”
‘It’s not news, the guff about them for their apologists notwithstanding, that heavily debt-funded private equity purchases tend to be more about looting companies than making them more efficient. This is bad enough in the retail sector; when it involves the provision of essential services, it’s catastrophic.