Private equity in healthcare could be putting lives at risk – study 

A major new study found patient deaths in US hospitals increased after facilities were bought by private equity firms.

Published today (23rd September), the study found mortality rates among Medicare patients rose by 13% in emergency departments at hospitals owned by private equity firms, compared to similar hospitals that remained independent. Researchers analysed more than seven million emergency and ICU visits between 2009 and 2019.

The increase equated to seven additional deaths per 10,000 emergency department visits, rising from a baseline of 52.

‘Among Medicare patients, who are often older and more vulnerable, this study shows that those financial strategies may lead to potentially dangerous, even deadly consequences,’ Dr Zirui Song, lead author of the study and healthcare policy expert at Harvard Medical School, said.

The study, conducted by experts from Harvard, the University of Pittsburgh, and the University of Chicago, also found that more critically ill patients were transferred to other hospitals after private equity takeovers — potentially to cut costs or shift risk.

Staffing cuts were also notable. Emergency department salary spending dropped by an average of 18%, while ICU staffing costs fell by 16%. ICU mortality remained stable, but sicker patients — including those on ventilators or dialysis — were more likely to be moved elsewhere, with those remaining experiencing shorter stays.

Separate findings published in 2023 reported a 25% increase in preventable medical errors, including infections, following private equity acquisitions — again likely linked to reduced staffing.

While private equity firms often claim to rescue struggling hospitals, Song’s 2024 research suggests they more often acquire financially stable facilities capable of taking on new debt while generating returns.

Speaking to Newsweek, Song said: ‘In theory, private equity investment can help turn around hospitals. ‘But in practice, it appears the focus is often on maximising returns — with serious implications for patient care.’

The researchers acknowledged some limitations to their study, noting that not all private equity takeovers are the same, and the sample of hospitals may not reflect all such acquisitions.

Photo by Markus Winkler via UnSplash 

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