Michigan nurses hold practice strike at Apollo-owned Lifepoint Health

Registered nurses and technical employees at UP Health System–Marquette held a one-day practice strike in mid-August to draw attention to concerns over staffing and working conditions as contract negotiations continue. 600 nurses and auxiliary staff have been bargaining since March, with the Michigan Nurses Association reaching a tentative agreement in late August. Union leaders said staffing shortages were their primary concern, noting that the hospital is not adequately prepared to handle the influx of patients from other Upper Peninsula facilities that have recently closed. Marquette Ancillary Staff and Technologists are still bargaining for their contract.

UPHS–Marquette is part of LifePoint Health, a national hospital operator. LifePoint is owned by private equity firm Apollo Global Management. Apollo manages capital on behalf of large institutional investors, including the State of Michigan Retirement System.

Private equity investment in healthcare companies can carry substantial risk to patients and healthcare workers. The high returns typically targeted by private equity investors over short time horizons may incentivize cost-cutting and risky behaviors that can harm patient care, including using high financial leverage, reducing staff, and pushing costly procedures.

Apollo first acquired LifePoint in 2018 for $5.6 billion in a leveraged buyout that included $2.9 billion of LifePoint debt. Although LifePoint is owned by one of the largest investment firms in the world, the hospital system carries a significant amount of debt. Credit ratings agencies, including Moody’s, have identified the company as facing high default risk. For a rural hospital like UPHS Marquette, a bankruptcy would be disastrous for the hospital’s employees and the communities that rely on it.

Hospital quality has also been a concern. According to The Lown Institute Hospital Index, which ranks hospitals and health systems based on health equity, value, and outcomes, multiple LifePoint facilities ranked among the worst hospitals in their states in 2024. Data from 2022 showed that some LifePoint hospitals reported the highest readmission rates in their respective states. In North Carolina for example, Lifepoint owns ten acute care hospitals, 3 of which are ranked among the top ten worst acute care hospitals in the state.

Apollo’s healthcare acquisitions have also drawn attention from policymakers. The firm’s 2018 purchase of Kindred Healthcare involved a complex spinoff arrangement that avoided formal antitrust review. Questions raised by that transaction, along with broader concerns about consolidation and patient care under private equity ownership, led the U.S. Senate Budget Committee to open a bipartisan inquiry into Apollo’s ownership of LifePoint. The investigation revealed private equity backed healthcare entities are putting their own profits over patients, leading to health and safety violations.

Read more about Apollo healthcare ownership here. 

Private equity firms like Apollo charge a steep price to invest, promising that the returns of private equity investments will broadly outperform those of public markets. The industry’s tendency to focus on short-term gain rather than on longevity and growth may indicate that long-term investments in private equity are not as lucrative as investors were promised. Between 2010 and 2020, public pension funds’ private equity investments underperformed the S&P 500 during the same time frame.

As Apollo Global Management gears up to solicit commitments for its new fund, Apollo Fund XI, investors should consider delaying or declining future commitments to Apollo until it addresses labor disputes in its portfolio and demonstrates that it has mitigated labor and patient health risks within its portfolio.