Private equity acquisitions tied to adverse patient outcomes: Study

Patients treated at hospitals acquired by private equity firms are more likely to develop hospital-acquired conditions, according to a new study published in JAMA Dec. 26. 

The findings suggest poorer quality of inpatient care at facilities associated with private equity firms, which have acquired more than 200 acute care hospitals from non-private equity owners, per the report. 

Researchers associated with Boston-based Massachusetts General Hospital; Boston-based Harvard Medical School; Boston-based Beth Israel Deaconess Medical Center; and the University of Chicago examined 662,095 hospitalizations at 51 private equity-acquired hospitals and 4,160,720 hospitalizations at 259 matched control hospitals using 100% Medicare Part A claims data. They assessed stays between 2009 and 2019, accounting for three years before and three years after a private equity acquisition. 

Private equity-acquired hospitals were associated with a 25.4% increase in hospital-acquired conditions, according to the report. This figure was driven by a 27.3% increase in falls and a 37.7% increase in central line-associated bloodstream infections, although private equity-acquired hospitals placed 16.2% fewer central lines than their counterparts. 

In addition, surgical site infections doubled following a private equity acquisition, despite these hospitals reporting an 8.1% reduction in surgical volumes. 

Despite their increased association with adverse events, private equity acquisitions see a smaller proportion of patients with Medicare, and the Medicare patients they do see are a part of a lower-risk pool; they tend to be modestly younger, less likely to have dual eligibility for Medicare and Medicaid, and more likely to be transferred to other acute care hospitals relative to the control group. 

However, the increase in hospital-acquired conditions at private equity-associated facilities might be connected to their staffing practices, per the study's authors. These hospitals tend to see an increased net income, due in part to reduced clinician staffing — which has previously been associated with adverse patient events. 

"Hospital success is measured not only in dollars or the number of patients who pass through the doors, but also in lives saved, complication rates, patient satisfaction, and a number of other quality and safety metrics," Sneha Kannan, MD, a Harvard Medical School research fellow and Massachusetts General Hospital physician said in a Dec. 26 news release. "We need to make sure we fully understand the costs and benefits of this prominent new force in health care."

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