From Ars Technica, by Beth Mole:
- Private equity firms, particularly Apollo Global Management, are increasingly acquiring hospitals across the US, a trend that has led to a decline in the quality of care, according to reports by the Private Equity Stakeholder Project (PESP) and a study in JAMA.
- Apollo Global Management, through Lifepoint and ScionHealth, operates 220 hospitals in 36 states. The PESP report found that some of these hospitals rank among the worst in their states, with an average rating of 2.8 stars, compared to the national average of 3.2 stars, on the Center for Medicare and Medicaid Services’ system.
- The JAMA study discovered a rise in serious medical errors and health complications among patients in the first few years after private equity firms take over, including a 25% increase in hospital-acquired conditions and a doubling of surgical site infections.
- Both reports highlight a pattern of cost-cutting measures and staff layoffs following private equity acquisition, leading to reduced services and underpaid staff. Apollo’s hospitals, for example, saw a reduction of $166 million in annual salary and benefit costs and $54 million in supply costs in 2020.
- The reports also noted that Apollo’s hospitals carry substantial debt, with ScionHealth and Lifepoint having 5.8 and 7.9 times more debt than income, respectively. Additionally, Apollo has profited from sale-leaseback transactions, which involve selling the land under the hospitals and then leasing it back, further straining the financial resources of these institutions.