Private equity’s power in healthcare continues to grow, raising concerns: KHN report

Private equity groups have invested about $1 trillion into nearly 8,000 healthcare transactions in the past decade, and some experts are pushing for more scrutiny of its increasing influence on the industry amid concern it may be causing higher medical bills and diminished quality of care, a Nov. 14 Kaiser Health News report said.

Because such investment groups typically invest less than $101 million, such transactions do not attract automatic antitrust reviews at the federal level, the report continued. That represents more than 90 percent of private equity investments in the industry.

Nevertheless, companies owned or managed by private equity groups have agreed to pay fines of more than $500 million since 2014 in over 30 lawsuits under the False Claims Act, which deals with false billing submissions, KHN’s investigation found.

The problem may be most acute in certain specialist fields and in certain metropolitan areas. While private equity, for example, plays a role in just 14 percent of gastroenterology practices nationwide, it controls about 75 percent of that market in at least five metropolitan areas across five states, including Texas and North Carolina, according to research from UC Berkeley’s Nicholas C. Petris Center. 

And private equity pockets may be getting deeper. In 2021 alone, over $206 billion was invested by such groups in healthcare, and there is plenty of “dry powder” around for more, KHN reported. The Healthcare Private Equity Association, for example, which boasts about 100 investment companies as members, says the firms have $3 trillion in assets awaiting allocation.

Private equity, like everything else, may have some poor performers but it doesn’t help to generalize as groups “vary tremendously” in how they operate their healthcare investments, Robert Homchick, a Seattle attorney, told KHN.

“Private equity has some bad actors, but so does the rest of the [healthcare] industry,” he said. “I think it’s wrong to paint them all with the same brush.”

Concerns remain, however, that, at least in some cases, private equity involvement is simply a vehicle for maximizing returns, often at the expense of patients. In addition to the $500 million fines, there is also evidence of some private equity groups pushing through additional testing and mandated patient numbers to boost returns, often in medically questionable scenarios, the report said, citing the example of National Spine and Pain Centers previously owned by private equity group Sentinel Partners.

In that case, National Spine paid $3.3 million in a whistleblower case related to allegations of unnecessary treatment and testing, KHN said.

The scope of such private equity dominance in some markets worries many industry observers, and much more needs to be done to help reel in such potential abuses, they say.

“We’re still at the stage of understanding the scope of the problem,” said Laura Alexander, former vice president of policy at the nonprofit American Antitrust Institute, which collaborated on the Petris Center research. “One thing is clear: Much more transparency and scrutiny of these deals is needed.”

Understanding the impact of the growing dominance of Medicare Advantage (MA)

https://mailchi.mp/d73a73774303/the-weekly-gist-may-27-2022?e=d1e747d2d8

recent piece in JAMA argues that policymakers need to be proactive in addressing how the rise of MA enrollment will affect the Medicare program as a whole, including its role in national quality and utilization measurement, rural healthcare access, and graduate medical education. The ability to monitor care delivered to the traditional, fee-for-service Medicare beneficiary population has been critical for assessing cost growth and shifting care patterns, distributing subsidies, and basing MA payments—all things that will become increasingly difficult as traditional Medicare becomes both smaller and less representative of the entire Medicare population.  

The Gist: Traditional Medicare has been a springboard for national healthcare policy goals and industry-wide innovations. However, consumers’ preference for, and policy shifts supporting, the growth of Medicare Advantage are proving to be unstoppable.

Providers must prepare for a future in which a shrinking minority of beneficiaries are enrolled in traditional Medicare. If current trends continue, Medicare policymakers must bolster ongoing support for medical education, and build a higher standard of transparency and quality reporting for MA carriers and providers to maintain the sustainability of one of the country’s greatest healthcare data resources.

Sutter Health: Nurses who staged 1-day strike must wait 5 days to return to work

Sacramento-based Sutter Health said nurses who went on strike April 18 will not be allowed to return to work until the morning of April 23, the San Francisco Chronicle reported.

The strike affected nurses and healthcare workers at Sutter Health facilities in Northern California. The nurses are members of the California Nurses Association, and the other workers are members of the Caregivers and Healthcare Employees Union, an affiliate of the California Nurses Association.

More than 8,000 registered nurses and healthcare workers were expected to participate in the strike, according to an April 18 news release from the unions.

In a statement shared with Becker’s, Sutter Health said the organization conducted strike contingency planning, which included “securing staff to replace nurses who have chosen to strike, and those replacement contracts provide the assurance of five days of guaranteed staffing amid the uncertainty of a widespread work stoppage.” 

“As always, our top priority remains safe, high-quality patient care and nurses may be reinstated sooner based on operational and patient care needs,” the statement said.

The California Nurses Association described Sutter Health’s decision as retaliatory, as well as “completely unnecessary and vindictive.”

“Nurses who are regularly scheduled to work during this lockout period will lose those days of pay,” the union said in a statement shared with Becker’s. “We urge Sutter to respect the nurses’ strike and let all nurses return to work.”

Sutter Health workers authorized a strike in March, and union officials announced an official strike notice April 8. Union members cited lack of transparency about the stockpile of personal protective equipment supplies and contact tracing as a reason for the strike. They also said they seek a contract that will help retain experienced nurses and provide sufficient staffing and training.

Nurses have been in contract negotiations since June. 

America’s giant medical debt

Americans owe at least $195 billion of medical debt, despite 90% of the population having some kind of health coverage, according to new research from the Peterson Center on Healthcare and the Kaiser Family Foundation.

Why it matters: People are spending down their savings and skimping on food, clothing and household items to pay their medical bills, Adriel writes.

About 16 million people, or 6% of U.S. adults, owe more than $1,000 in medical bills, and 3 million people owe more than $10,000.

  • The financial burden falls disproportionately on people with disabilities, those in generally poor health, Black Americans and people living in the South or in non-Medicaid expansion states, per the research.

Go deeper: 16% of privately-insured adults say they would need to take on credit card debt to meet an unexpected $400 medical expense, while 7% would borrow money from friends or family, per the research, which focused on adults who reported having more than $250 in unpaid bills as of December 2019. 

It’s not yet clear how much the pandemic and the recession factor into the picture, in part because many people delayed or went without care. There also was a small shift from employer-based coverage to Medicaid, which has little or no cost-sharing.

  • While the new federal ban on surprise billing limits exposure to some unexpected expenses, it only covers a fraction of the large medical bills many Americans face, the researchers say.

The partisan divide in coronavirus vaccinations is widening

One hesitates to elevate obviously bad arguments, even to point out how bad they are. This is a conundrum that comes up a lot these days, as members of the media measure the utility of reporting on bad faith, disingenuous or simply bizarre claims.

If someone were to insist, for example, that they were not going to get the coronavirus vaccine solely to spite the political left, should that claim be elevated? Can we simply point out how deranged it is to refuse a vaccine that will almost certainly end an international pandemic simply because people with whom you disagree think that maybe this is a good route to end that pandemic? If someone were to write such a thing at some attention-thirsty website, we certainly wouldn’t want to link to it, leaving our own readers having to figure out where it might be found should they choose to do so.

In this case, it’s worth elevating this argument (which, to be clear, is actually floating out there) to point out one of the myriad ways in which the effort to vaccinate as many adults as possible has become interlaced with partisan politics. As the weeks pass and demand for the vaccine has tapered off, the gap between Democratic and Republican interest in being vaccinated seems to be widening — meaning that the end to the pandemic is likely to move that much further into the future.

Consider, for example, the rate of completed vaccinations by county, according to data compiled by CovidActNow. You can see a slight correlation between how a county voted in 2020 — the horizontal axis — and the density of completed vaccinations, shown on the vertical. There’s a greater density of completed vaccinations on the left side of the graph than on the right.

If we shift to the percentage of the population that’s received even one dose of the vaccine, the effect is much more obvious.

This is a relatively recent development. At the beginning of the month, the density of the population that had received only one dose resulted in a graph that looked much like the current density of completed doses.

If we animate those two graphs, the effect is obvious. In the past few weeks, the density of first doses has increased much faster in more-Democratic counties.

If we group the results of the 2020 presidential contest into 20-point buckets, the pattern is again obvious.

It’s not a new observation that Republicans are less willing to get the vaccine; we’ve reported on it repeatedly. What’s relatively new is how that hesitance is showing up in the actual vaccination data.

A Post-ABC News poll released on Monday showed that this response to the vaccine holds even when considering age groups. We’ve known for a while that older Americans, who are more at risk from the virus, have been more likely to seek the vaccine. But even among seniors, Republicans are significantly more hesitant to receive the vaccine than are Democrats.

This is a particularly dangerous example of partisanship. People 65 or older have made up 14 percent of coronavirus infections, according to federal data, but 81 percent of deaths. That’s among those for whom ages are known, a subset (though a large majority) of overall cases. While about 1.8 percent of that overall group has died, the figure for those aged 65 and over is above 10 percent.

As vaccines have been rolled out across the country, you can see how more-heavily-blue counties have a higher density of vaccinations in many states.

This is not a universal truth, of course. Some heavily Republican counties have above-average vaccination rates. (About 40 percent of counties that preferred former president Donald Trump last year are above the average in the CovidActNow data. The rate among Democratic counties is closer to 80 percent.) But it is the case that there is a correlation between how a county voted and how many of its residents have been vaccinated. It is also the case that the gap between red and blue counties is widening.

Given all of that, it probably makes sense to point out that an argument against vaccines based on nothing more than “lol libs will hate this” is an embarrassing argument to make.