Private Equity in Healthcare – PESP’s August 2025 Roundup

Each month, PESP’s Healthcare Team will be putting together a roundup that shares the latest news stories related to private equity in healthcare and highlights the work that our team has published in the last month.

In the news

Another former Pipeline hospital closes

• Weiss Memorial Hospital, a critical safety net provider on Chicago’s North Side, ceased most operations in August. The hospital’s shutdown marks another loss for underserved communities and reflects the long-term consequences of private equity investment in healthcare.
• Weiss Memorial was previously owned by Pipeline Health, a private equity-backed hospital chain whose financial practices were the focus of a 2023 report by the Private Equity Stakeholder Project (PESP), How Private Equity Raided Safety Net Hospitals: Volume 2—Pipeline Health. That report detailed how Pipeline’s owners engaged in extractive financial strategies that destabilized multiple hospitals in the Chicago area, including the closure of Westlake Hospital in 2019.
• “This is what happens when you treat healthcare like a commodity,” said Mary Bugbee, Healthcare Director at the Private Equity Stakeholder Project. “Private equity firms like those behind Pipeline often load hospitals with debt and strip out valuable real estate, and then walk away—leaving community institutions so weakened they struggle to survive over the long term.”

The Substantial Costs Of The No Surprises Act Arbitration Process – Health Affairs

• A new study published in Health Affairs reported that “combining required fee payments, administrative costs, and additional payments for services, the IDR process has generated at least $5 billion—about $2 to $2.5 billion annually—in total costs through the end of 2024. Over the last two years, these costs have been driven by a high volumeof disputes and high provider use of IDR––primarily by private equity backed groups…”
• A 2024 research update from PESP found that four private equity firms have dominated the IDR The number of claims filed by only these firms has far exceeded initial expectations for the entire program.
  • 70% of the 274,432 total claims in the first half of 2023 were submitted by private equity-owned companies, including Team Health, SCP Health, Radiology Partners, and Envision Healthcare.

New PESP research analyzes Genesis Healthcare bankruptcy, featured in HealthcareDive

• PESP published a research update on August 11 on the bankruptcy of Genesis Healthcare. The update received coverage in Newsweek and industry news outlets, HealthcareDive and McKnight’s.
• Genesis’s financial unraveling reflects a familiar pattern: private equity owners extracted value through sale-leaseback deals and layered debt, while the company struggled to maintain operations. The result is another nursing home giant in bankruptcy, and a case study in how financial engineering can undermine long-term care delivery.
• “Genesis Healthcare’s bankruptcy was a predictable result of a financial strategy that extracted value through debt and real estate transactions while leaving the company with fewer resources to sustain care,” Michael Fenne, Senior Research Coordinator at PESP, told Newsweek.

Sen. Chris Murphy (D-CT) releases report – A Dangerous Prospect: How Private Equity Decimated Connecticut Hospitals

• The report documents the devastating effects of private equity ownership on three hospitals in Connecticut, detailing how Prospect Medical Holdings, backed by the private equity firm Leonard Green & Partners, pursued short-term profits at the expense of patients, staff, and community health.
• The Private Equity Stakeholder Project’s research is cited multiple times in Senator Murphy’s report. In particular, the report references PESP’s Private Equity Hospital Tracker, which documents 488 hospitals across the United States owned by private equity firms. This resource helps policymakers, journalists, and community advocates understand the scale of private equity’s footprint in healthcare and the risks it poses for communities.

Private-equity-backed U.S. Digestive Health, the Philly region’s largest private GI group, has been sold to UnitedHealth unit – Philadelphia Inquirer

• The Philadelphia Inquirer reported that U.S. Digestive Health has been sold to a unit of UnitedHealth Group Inc., which owns the insurer and has a network of more than 90,000 physicians.
• Private equity firm Amulet Capital sold U.S. Digestive Health in late January without announcement. The Inquirer learned of the U.S. Digestive sale last week from a retired physician. UnitedHealth confirmed Monday that U.S. Digestive is now part of SCA Health, which UnitedHealth acquired in 2017.
• PESP’s Senior Research & Campaign Coordinator Michael Fenne was quoted in the coverage: “Private equity firms benefit from being allowed to operate in relative secrecy. This is another example of that,” said Michael Fenne…“The public has a right to know who owns their provider.”

Healthcare team’s latest blogs, reports, and media mentions

Blog Posts:

• Sycamore acquires Walgreens, raises alarms over debt and bankruptcy risk
• Newsweek: Bankruptcies Are Hitting America’s Health Care Giants
• PESP research cited in Senator Murphy’s report on private equity
• Private Equity Health Care Acquisitions – July 2025
• Genesis Healthcare files for bankruptcy
• Another former Pipeline hospital closes

Other PESP healthcare news and mentions in August:

• The Chicago Tribune, HealthcareDive, and McKnight’s cited PESP in coverage of Sycamore Partners’ takeover of Walgreens.
• PESP’s hospital tracker was cited in Radiology Business.
• Healthcare Director, Mary Bugbee was quoted in CT Post article, “For-profit firm named as first bidder for some Prospect hospitals in bankruptcy.” She told the Post:
  • “These hospitals continue to be acquired by these companies that don’t have great track records or reputations because there’s literally no one else who’s willing to take the reins. These hospitals have been asset-stripped. They have been pillaged by both their former private equity investors and the hospital landlord that worked with them, and they really don’t have any value, because the value has been extracted out.”