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February 28, 2019

Potential Implications of Private Equity Investments in Health Care Delivery

Author Affiliations
  • 1Harvard Medical School, Boston, Massachusetts
  • 2Massachusetts General Hospital, Boston
JAMA. 2019;321(11):1047-1048. doi:10.1001/jama.2019.1077

Much of the US health care system relies on private physician practices. Little is known about the role of private equity in today’s health care delivery system. From 2010 to 2017, the value of private equity deals involving the acquisition of a health care–related company (most involving physician practices and hospitals) increased 187% and reached $42.6 billion, while the number of health care deals increased by 48% (eFigure in the Supplement).1 Given the increasing role of this type of financing, physicians and policy makers should understand private equity, common strategies used by its firms, and the potential risks and benefits for physicians and patients.

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    2 Comments for this article
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    Private Investor Equity Will Rob Physicians of Autonomy and Integrity
    Edward Volpintesta, MD | Bethel Medical Group
    There should be little doubt that physician autonomy and integrity will decrease greatly as private investors’ involvement increases.

    One need look no further than what has happened since managed care entered health care. The practice of medicine has been transformed into a business; and physicians are tormented by time-consuming regulations, pre-authorizations, and electronic health records.
    CONFLICT OF INTEREST: None Reported
    Providers Other Than MDs Read These Articles.
    Andrea Breeding, MSN | Self Employed
    Do the authors realize that providers other than MDs read these articles? Or maybe they just don't care. There are at least two references about non-physician providers written in a negative way. The authors claim that non-physician providers "are not supervised" and there are "concerns over patient safety and low value care" if a practice is bought by private equity firms.

    You have no grounds to make these sorts of claims. There is no data that says that non-physician providers need a certain level of supervision, are a threat to patient safety
    or provide low value care.

    You have plenty of reasons to be concerned about the implications of private companies getting in the medical business. But they are able to sort through the noise and determine how to operate efficiently. They know that non-physician providers offer value. If a private company buys a practice, that doesn't mean the non-physician providers will suddenly become a liability. Whoever hired them to begin with didn't think that.

    You are using erroneous statements to support your position. The non-physician provider would not be a viable profession and would not be in demand if what you said about them were true.
    CONFLICT OF INTEREST: None Reported
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