PESP State Risk Index cited in NBC investigation of PE-backed hospital in NM
July 22, 2024
NBC News published two stories following stories unfolding at Memorial Medical Center, a nonprofit community hospital in Las Cruces, New Mexico owned by the city and the county. The hospital is operated as a for-profit facility by Lifepoint Health, a hospital chain backed by private equity firm Apollo.
NBC News June 5, 2024: Cancer patients say this hospital turned them away
NBC followed Barbara Quarrell who has dedicated nearly thirty years to nursing at Memorial Medical Center. After receiving a cancer diagnosis in 2022, she turned to Memorial for treatment, considering it her hospital with familiar people.
However, Memorial’s owner Lifepoint Health, a private equity-backed chain, had different plans. When Quarrell’s doctor tried to schedule her chemotherapy, Memorial inquired about her insurance. Despite having True Health New Mexico, an ACA marketplace plan costing her $800 monthly, Memorial declined her treatment. This forced Quarrell and her husband to move over 220 miles to Albuquerque for care at a facility that accepted her insurance.
Quarrell felt abandoned by Memorial, questioning their humanity and care. She wasn’t alone; eleven other cancer patients and seven Memorial clinicians reported similar issues with treatment denials or upfront payment demands. These denials, especially impactful for oncology patients given the distance to the nearest cancer centers, don’t occur in Memorial’s emergency department, which would be illegal. Despite Lifepoint operating the hospital, the facility and land are owned by Las Cruces and Dona Ana County, and denying care could breach Memorial’s lease agreement, which mandates providing care to those unable to pay.
NBC News July 17, 2024: New Mexico attorney general launches probe of patient care at private equity-run hospital
New Mexico’s Attorney General Raúl Torrez announced an investigation into Memorial Medical Center in Las Cruces, operated by Lifepoint Health. The investigation aims to determine if the hospital violated state laws by denying care to indigent and low-income patients, as highlighted in a recent NBC News report.
Torrez stated that his office is reviewing Memorial’s patient policies to ensure they comply with state law and the requirements for providing care to needy patients. At a news conference, he shared that he had met with patients and providers from Memorial to hear their concerns.
Torrez criticized the hospital’s management for prioritizing profit over patient care, stating, “It is apparent to me that decisions have been made from a standpoint that is seemingly motivated by profit, by maximizing the bottom line and without due respect and due regard to patients under their care.” He also cautioned hospital management against retaliating against those who speak out about its practices.
In recent years, private-equity firms, such as Apollo, have acquired many healthcare companies. Their strategy often involves increasing the companies’ debt and reducing expenses to boost profitability, making them attractive to future buyers. In both of its stories, NBC News cited PESP’s Private Equity Risk Index that showed nearly one-quarter of hospitals in New Mexico are under the control of private-equity firms.
According to the Risk Index, New Mexico is at a very high risk level for private equity’s influence in the state’s healthcare industry. New Mexico is listed as the riskiest state in the union in terms of its exposure to private equity. Unfortunately, the state is among the top 10 states for both the share of hospitals and the share of nursing homes controlled by private equity.
