Hospitals owned by private equity are harming patients, reports find
Ars TechnicaJan 18
Hospital Operator Steward Health Files for Bankruptcy
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The Facts
Steward Health Care System, the largest physician-owned hospital network in the US with dozens of hospitals across eight states, filed for bankruptcy early Monday morning.
The Texas-based firm, whose network includes nine hospitals in Massachusetts, is backed by private equity (PE) investors but reportedly owns creditors over $500M. However, it says that all its services are still currently up and running.
The Spin
Establishment-critical narrative
Not only do PE firms sink hospitals into bankruptcy once their investment is over, they destroy patient care while they own them. A recent report found that rates of medical errors increase within a few years of the initial investment, while another found that some of the 220 owned by PE firm Apollo were ranked as the worst in their states. These companies buy up healthcare facilities with no care for the patients inside them.
Pro-establishment narrative
While some may claim the opposite, PE firms are actually saving both American hospitals and lives, having an especially positive effect on mortality rates. This is likely because the proportion of physicians, nurses, and pharmacists at PE-owned hospitals is greater than others. News of a struggling hospital is always tragic, but that doesn't mean we should paint the entire industry in a negative light.
Nerd narrative
There is a 50% chance that at least 23.4% of US gross domestic product (GDP) will be spent on healthcare in 2035, according to the Metaculus prediction community.