A new report from the Private Equity Stakeholder Project released in January revealed how private equity firm Apollo Global Management’s ownership of two major American hospital systems degrades services, hurts workers, and puts patients at grave risk.
The report was published amidst rising scrutiny of private equity hospital ownership. Last month, the Senate Budget Committee launched a bipartisan investigation into private equity ownership of hospitals that specifically focuses on Apollo’s ownership of Lifepoint. Weeks later, a new study published in JAMA found an increase in adverse patient events at hospitals purchased by private equity firms.
The comprehensive study, “Apollo’s Stranglehold on Hospitals Harms Patients and Healthcare Workers,” was written by PESP healthcare director Eileen O’Grady and produced in conjunction with the American Federation of Teachers and the International Association of Machinists and Aerospace Workers. Multiple news publications covered the new report and its alarming findings of the consequences of Apollo’s portfolio of 220 hospitals.
Modern Healthcare January 16, 2023: Report adds to scrutiny of private equity-owned hospitals
Lifepoint Health and ScionHealth’s ownership by Apollo Global Management is the focus of a report by a nonprofit formed to hold private equity buyers accountable for the impact their acquisitions have on services and communities.
The report released last week by the watchdog organization Private Equity Stakeholder Project, which criticized the systems’ performance and Apollo, follows a recent academic study published in JAMA that raised concerns about higher rates of adverse patient safety events at private equity facilities. It was sponsored by two unions representing healthcare workers—the American Federation of Teachers and the International Association of Machinists and Aerospace Workers.
“It’s a lot of the quality and access concerns that advocates have been worried about related to private equity ownership of hospitals and it is happening on a very large scale with Lifepoint,” said Eileen O’Grady, healthcare director at the Private Equity Stakeholder Project.
At Lifepoint and ScionHealth facilities, around 70 of which are in rural areas, this has played out as a reduction in less-profitable services, layoffs and a lack of competitive wages, she said. “Those kinds of cuts mean that patients have less time that they spend with their providers, and that increases the risks of hospital-acquired conditions,” she said.
Becker’s Hospital Review January 17, 2023: Apollo’s 220-hospital ‘stranglehold’ harms patients and workers, report alleges
Private equity firm Apollo Global Management’s ownership of two large health systems — Louisville, Ky.-based ScionHealth and Brentwood, Tenn.-based Lifepoint Health — downgrades hospital services, hurts workers and puts patients at risk, according to a study published Jan. 11 by the Private Equity Stakeholder Project.
Since acquiring Lifepoint in 2018 and spinning off ScionHealth in 2021, Apollo has consolidated ownership of 220 hospitals in 36 states, with a workforce of about 75,000 employees. Many of the hospitals have experienced service cuts, layoffs, poor quality ratings and regulatory investigations, according to the report.
“Apollo’s purchase of these hospital systems follows a disturbing pattern of harm caused by the growing influence of private equity in the healthcare sector,” PESP Healthcare Director Eileen O’Orady, said in a news release. “Private equity’s utmost priority to maximize short-term profit over the long-term viability of the companies it controls leads to excessive debt, cost cutting, worse outcomes for patients and deteriorating working conditions for employees. Apollo’s management of its hospitals seems to follow the usual playbook.”
Apollo, Lifepoint and ScionHealth did not respond to Becker’s request for comment.
Ars Technica January 17, 2023: Hospitals owned by private equity are harming patients, reports find
Private equity firms are increasingly buying hospitals across the US, and when they do, patients suffer, according to two separate reports. Specifically, the equity firms cut corners, slash services, lay off staff, lower quality of care, take on substantial debt, and reduce charity care, leading to lower ratings and more medical errors, the reports collectively find.
Last week, the financial watchdog organization Private Equity Stakeholder Project (PESP) released a report delving into the state of two of the nation’s largest hospital systems, Lifepoint and ScionHealth—both owned by private equity firm Apollo Global Management. Through those two systems, Apollo runs 220 hospitals in 36 states, employing around 75,000 people.
PESP noted some particularly disturbing examples of conditions in some of Apollo’s hospitals. One hospital in North Carolina— Lifepoint’s Wilson Medical Center—drew federal and state regulatory attention for a string of worsening conditions in 2022. North Carolina Department of Justice opened an investigation noting a decrease in available hospital beds, chronic understaffing, a decrease in treatment for low-income patients, and effective denials of care to those who couldn’t pay for essential treatments.
STAT Health Care News January 16, 2023: Health Care Inc Weekly Newsletter
Last month, Brittany Trang told you about the Senate’s bipartisan probe into private equity-owned hospitals. Now, the Private Equity Stakeholder Project has a report on two of the companies the Senate is investigating — LifePoint, a large hospital chain, and Apollo Global Management, LifePoint’s owner and the second-largest private equity firm in the U.S. The report discusses the web of complex mergers and spinoffs Apollo’s health care division has undertaken to avoid antitrust scrutiny, as well as the excessive debt and bad conditions at the LifePoint hospitals, Brittany writes.
DOTmed Healthcare Business News January 24, 2023: New report slams PE firm Apollo Global for allegedly degrading services and neglecting patients in hospitalsHealth Care Inc Weekly Newsletter
The report, Apollo’s Stranglehold on Hospitals Harms Patients and Healthcare Workers, pays special attention to conduct at two reputable American hospitals, Lifepoint Health, which Apollo acquired in 2018, and ScionHealth, which it spun off in 2021. Investigators in the inquiry, known as the Private Equity Stakeholder Project (PESP), say that Apollo’s actions put both providers in substantial debt and subjected them to high credit risk.
They also allege that Apollo has put patients and healthcare workers at rural hospital chains at risk and completed questionable transactions that raise concerns about anti-competitive practices, including a complex spinoff as part of its acquisition of Kindred Healthcare, in Seattle, to evade antitrust scrutiny.
PESP Healthcare director Eileen O’Grady told HCB News that the report emphasizes the committee’s view that the main priority among PE firms like Apollo is to maximize short-term profits over the needs of patients, hospital facilities, and healthcare workers.
“States should increase oversight over changes in ownership or control of hospitals, including pursuing policies that allow regulators to impose conditions on changes in control, such as requiring capital commitments, limiting the sale of real estate, and prohibiting extractive financial policies, such as management fees and debt-funded dividends,” she said.