Private Equity Ownership Raises Patient Infection and Fall Risks

Patients are at a higher risk of falling, acquiring new infections, or experiencing other forms of harm during their hospital stay after it is acquired by a private equity firm, according to a recent study led by researchers at Harvard Medical School. Published in JAMA, the research is part of a growing body of nationwide analyses exploring how private equity takeovers impact the quality of patient care in hospitals, particularly focusing on conditions or outcomes deemed preventable. 

Concerns about the increasing role of private equity in U.S. healthcare, with $1 trillion invested in the past decade, have prompted these investigations. Previous studies by the same researchers indicated that the high-debt, for-profit financial model of hospital ownership under private equity may lead to increased spending and economic implications. However, the effects on patient health and the quality of care have remained understudied. 

The researchers found that private equity acquisitions resulted in higher rates of preventable conditions or outcomes, which are key measures of hospital safety and quality. These increases were observed in conditions such as falls and infections, signaling potential concerns about bottom-line incentives overshadowing patient care and safety. 

Zirui Song, Associate Professor of Health Care Policy and Medicine at Harvard Medical School, highlighted the previous findings that private equity acquisitions led to higher charges, prices, and societal spending. The new study now adds to the growing evidence that there are downstream concerns for the clinical quality of care delivered to hospital patients. 

The economic repercussions of private equity acquisitions have long been a concern, with worries about hospital bankruptcies leaving underserved populations with limited access to care. The current study delves into the impact on patient health and care quality, revealing potential risks associated with the private equity model. 

The study examined insurance claims data for fee-for-service Medicare hospitalizations from 2009 to 2019, encompassing over 600,000 hospitalizations at 51 private equity hospitals and more than 4 million hospitalizations at 259 similar hospitals not acquired by private equity. The researchers compared patient outcomes before and after the hospital was acquired by private equity, focusing on preventable conditions. 

After a hospital was acquired by private equity, Medicare patients had a 25% increase in hospital-acquired complications, a 27% increase in falls, and a 38% increase in bloodstream infections caused by central lines. The findings were alarming, suggesting that the shift in ownership might be negatively affecting patient safety and care quality. 

The researchers emphasized the need to understand the costs and benefits of private equity’s role in healthcare fully. They called for increased transparency, policy solutions, and efforts to lift the veil on private equity operations in healthcare. A policy framework including regulating fraud and abuse, increasing antitrust oversight, reducing moral hazard, protecting against inflated prices, and enhancing transparency in reporting private equity acquisitions was proposed as a potential solution. 

The study sheds light on the potential risks associated with private equity ownership in healthcare, raising awareness among policymakers, insurance companies, and public sector bodies to protect patients and societal resources from adverse effects. Understanding the consequences of the corporatization of healthcare delivery is crucial for all stakeholders, including patients, providers, investors, taxpayers, employers, and insurers. 

Journal Reference  

Changes in Hospital Adverse Events and Patient Outcomes Associated with Private Equity Acquisition, JAMA (2023). DOI: 10.1001/jama.2023.23147. jamanetwork.com/journals/jama/ … 1001/jama.2023.23147.