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Private Equity in Healthcare – PESP’s September 2025 Roundup

October 3, 2025

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

PESP releases first ever PACE Investment Tracker and report

  • As the Program of All-Inclusive Care for the Elderly (PACE) expands, new forms of ownership are beginning to enter a field historically led by nonprofit organizations. Private equity and venture capital firms are increasingly active in the space, signaling a shift in how PACE providers may be operated and financed.
  • At least 30 PACE programs have private equity and/or venture capital backing, representing 15% of all programs.
  • The report includes a case study of InnovAge, a PACE provider owned by Apax Partners and Welsh, Carson, Anderson & Stowe. Under private equity ownership, the company pursued rapid growth and complex financial strategies, including stock buybacks and debt-funded investor payouts, while facing multiple regulatory sanctions and investigations tied to care quality.
  • Report author Michael Fenne told McKnights Home Care: “Private equity sees PACE as a guaranteed revenue stream, not a care model. The result is that PACE, once a nonprofit-driven model focused on keeping seniors healthy at home, is increasingly being treated as a financial opportunity for investors.” McKnights Senior Living also covered the report.

Private Equity Acquiring Large Shares Of The Opioid Treatment Market Without Changing Market-Level Methadone Supply – Health Affairs

  • A new study published in Health Affairs has found that private equity acquisitions of opioid treatment programs (OTPs) may consolidate ownership of OTPs without changing methadone supply.
  • The study identified 357 PE-acquired OTPs in forty-three states during the period 2011–22. Nationally, the number of OTPs with any PE acquisition during the period increased from 5 (0.26 percent) in 2011 to 358 (18.9 percent) by 2022.
  • The report authors note that “Given policy makers’ widespread call for increased supply, additional scrutiny of the impact of PE investment on patient access to methadone might be warranted.”
  • A March 2024 investigation by STAT found that “private equity firms had acquired stakes in nearly one-third of all methadone clinicsin recent years, gaining outsize control of the U.S. addiction treatment industry even as the country’s opioid epidemic has developed into a full-fledged public health crisis.”

Deaths Rose in Emergency Rooms After Hospitals Were Acquired by Private Equity Firms – Harvard Medical School

  • A study by Harvard researchers published in the Annals of Internal Medicine has found that patient death rates increased in the emergency departments of U.S. hospitals acquired by private equity firms compared to similar hospitals not acquired by private equity.
  • Researchers linked the increase in mortality to cuts in salary and staffing levels.
  • “Staffing cuts are one of the common strategies used to generate financial returns for the firm and its investors,” said senior author Zirui Song, associate professor of health care policy in the Blavatnik Institute at HMS and HMS associate professor of medicine at Massachusetts General Hospital, who has published extensively on the implications of private equity in health care. “Among Medicare patients, who are often older and more vulnerable, this study shows that those financial strategies may lead to potentially dangerous, even deadly consequences,” Song said.

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

Reports:

Blog Posts:

Other PESP healthcare news and mentions in August:

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