JustCare

Tag: Private equity

  • Do you really need a tooth implant?

    Do you really need a tooth implant?

    If your dentist suggests you replace your teeth rather than fix them, get a second opinion. You should avoid getting tooth implants if you can. Not only are they extremely expensive, they are not likely to be a better alternative than crowns and root canals, reports Brett Kelman and Anna Werner for KFF Health News.

    Prosthetic teeth are not likely to function as well as your own teeth. One patient of ClearChoice, which provides people with dental implants, couldn’t chew for two years because the implants were not aligned properly. She needed corrective surgery.

    If you can save your teeth, do so. As a general rule, you should get implants when you have missing teeth or teeth so damaged that they cannot be replaced. Dentists’ primary goal should be to preserve their patients’ teeth.

    According to experts, implants are very costly and can lead to surgical complications. Moreover, they increase the likelihood of people having few ways to treat new problems with their teeth. Dental experts say that they find in most cases that they are asked to give second opinions about dental implants, teeth can be saved.

    No one should think that dental implants will hold up better or longer than your own teeth. Don’t believe the TV and social media ads that suggest otherwise. You have to take care of implants even more than you have to take care of natural teeth. You can get gum and bone infections or bone loss in the area surrounding implants. That can destroy the implant’s efficacy.

    Moreover, too often the implants do not fit well and need replacing. Dentists often have not been trained in how to provide an implant. Training is not required in any state except Oregon. Without training and experience, you can imagine what the results might be. Oral surgeons, periodontists, or prosthodontists have training but usually are not performing the implants.

    Many lawsuits have been filed against the dental implant chains, alleging negligence and malpractice. Private equity firms own a lot of dental implant chains. Their goal is to make money.

    What exactly happens when you get an implant? The dentist screws a metal post into your jaw and then attaches a fake tooth or a crown to it. For patients who have teeth that cannot be saved, dental implants can be a lifesaver.

    The companies that are pushing dental implants–ClearChoice, Aspen Dental, Affordable Care and Dental Care Alliance–refused to speak to a reporter about their implant services.

    Perhaps thanks to the marketing, in 2022, Americans had more than 3.7 million implants.

    Here’s more from Just Care:

  • Private equity is destroying ER care

    Private equity is destroying ER care

    With private equity, profits always come first. ER care is no exception. Keren Landman, MD reports for Vox on how private equity is destroying ER care. It’s good reason you should choose your hospital emergency room carefully.

    One ER doctor Landman spoke with described how, when he started out, there were plenty of physicians in the ER, hospitals made sure that the physicians’ needs were met when the emergency rooms were at their busiest, and physicians delivered most of the care people needed in emergencies. Then, private equity bought his practice and everything changed very fast. In short, private equity saved money by cutting the number of physicians in the ER, reducing their hours and replacing them with nurse practitioners and physicians’ assistants.

    This ER doctor quit his job once he was working for a private equity firm and moved to another hospital. Shortly thereafter, the same private equity firm bought the ER practice at this hospital. It happened again and again so that the ER doctor couldn’t find an ER that wasn’t private equity-owned.

    With private equity ownership, the ER doctor reports that he and his colleagues were given little time to do their jobs and staffing was inadequate. As a result, patients were not getting the care they needed, whether they had a simple need or were at risk of dying from a heart attack. Consequently, patients were dying, perhaps not directly because of these cuts, but, if not, very likely indirectly.

    What is private equity doing exactly? Private equity is buying ownership of ER doctors’ groups and other staff rather than buildings or equipment. Buying doctors’ groups allows private equity firms to charge patients whatever they please. People needing ER care can’t comparison shop. Private equity-owned ERs also tend to be out of insurer networks in order to boost ER profits. Once private equity takes over an ER department, on average, patient costs rise more than 80 percent.

    As of March 2024, private equity now controls 25 percent of all emergency rooms in the US. It became easy for them to take over in the late 20th century early 2000’s after doctors’ groups contracted with hospitals to run their ERs . These “contract management groups” or CMGs centralized processes, were entrepreneurial, and focused on profits, which made it easy for private equity to buy them out.

    In the early 21st century, private equity began its takeover of ER care. It saw profit opportunities from charging patients high prices for their care and from cutting ER staff. There’s no limit to what they could charge. In one case, a private equity firm charged a patient thousands of dollars for wound care for a half-inch wound to which glue was applied in the ER.

    By 2010, private equity owned about nine percent of ER doctors’ groups. And, private equity ownership of hospital ERs continued to grow even after Congress passed its No Surprises Act law that kept private equity firms from gouging patients.

    The No Surprises Act, which took effect in January 2022, prohibits physicians from billing patients in the ER for out-of-network care. Patients are only responsible for deductibles and copays associated with in-network care. The law also prohibits an in-network hospital from billing patients above the in-network rate for routine care they receive from an out-of-network physician if they don’t consent to receiving it.

    People are still wrongly billed in violation of the No Surprises Act, but they are often unaware of it. Moreover, the No Surprises Act doesn’t cover out-of-network ambulances or urgent care facilities.

    Here’s more from Just Care:

  • Public Citizen urges the Biden administration to keep profiteers out of health care, protect patients from corporate greed

    Public Citizen urges the Biden administration to keep profiteers out of health care, protect patients from corporate greed

    In a response to a request for information from the Department of Health and Human Services, the Department of Justice (DOJ) and the Federal Trade Commission (FTC), Public Citizen and several dozen other groups urge the Biden administration to keep profiteering out of health care, stop health care consolidation, and protect patients from corporate greed. Private equity, health insurers and pharmaceutical companies need to be reined in. They call for a universal health care system in the US.

    Eagan Kemp, health care policy advocate at Public Citizen, explains that private equity is taking over the US health care system, driving up patient costs and undermining quality of care. Profits come first, second and third. The Biden administration should eliminate the profiteering and ensure our health care system meets patient needs.

    Today, our profiteering health care marketplace has driven up costs and left millions of patients without care or paying exorbitant prices for their care, even with insurance. As a result, we spend an average of $13,500 a year  per person, often twice as much as every other wealthy country, on health care. No other developed country has so many companies extracting profits from its health care system.

    Insurers operating Medicare Advantage plans can compromise patient care in order to maximize profits. They are paid a fixed amount per enrollee upfront. So, they market to the healthy and create obstacles to care—e.g., delay and deny needed care—which lead people with costly conditions to disenroll.

    Public Citizen argues that the government needs to standardize coverage in Medicare Advantage so that insurers cannot inappropriately deny needed care. The administration should improve network adequacy requirements. The administration needs to better oversee the Medicare Advantage plans and recoup overpayments. It should not give plans a star rating if they are violating their contractual obligations. And, it should penalize bad actors in meaningful ways.

    Here’s more from Just Care:

  • Oregon moves toward restricting private equity from owning physician practices

    Oregon moves toward restricting private equity from owning physician practices

    Most states have laws prohibiting corporate interference in the practice of medicine. But, corporations and private equity firms have been getting around these laws, buying up primary care and specialty practices, by enlisting physicians to run their businesses. Amelia Templeton writes for OPH.org that Oregon is working to prevent some of this activity because it is benefiting corporations at the expense of patients.

    The opposition is fighting back, dragging out the standard arguments that any law preventing corporate ownership of physician practices will kill innovation and business. The question the Oregon lawmakers must ask is whether concerns about the health and well-being of their constituents resulting from the corporate ownership of medical practices should be paramount.

    As it is, nursing homes, health systems and hospitals are not likely to be covered under any new law in Oregon, even though their corporate ownership raises serious patient safety, health care access and health care cost concerns. Corporate owners can direct physicians to spend less time with patients or to see fewer Medicaid patients.

    Private equity ownership of medical practices is almost always a short-term play. The private-equity firm takes as much money out of the business as possible or implements ways to generate more revenue and then tries to flip it for a profit. Patient care is at best a secondary concern after profits.

    Right now, some types of corporations must abide by a loosely written Oregon law that requires physicians to have a majority stake in any medical practice that is corporate-owned.  Oregon legislators are looking to broaden that to extend to more health care corporate entities.This Oregon law does not apply to hospitals and nursing homes.

    If passed, the new legislation would still allow corporate-owned medical practices to exist for the next seven years. After seven years, they would need to have transitioned to a different ownership structure. Sadly, that’s plenty of time for the corporate owners to lobby the Oregon legislature to repeal the legislation if it is passed.

    Here’s more from Just Care:

  • United Health now controls 1 in 10 physicians

    United Health now controls 1 in 10 physicians

    Steph Weber reports for Medscape that UnitedHealthcare’s owner, UnitedHealth Group now controls–either owns or otherwise works with–one in ten physicians. Concerns are mounting about corporate control of health care. Treating physicians are no longer in full charge of patient care as insurers increasingly overrule their treating decisions.

    Legally, insurers are not allowed to interfere in the practice of medicine. But, what does that really mean? It apparently does not prevent insurers from telling physicians how much time to spend with their patients or who to refer them to if they need to see a specialist–anti-competitive behavior. It also does not stop insurers from providing financial incentives to their physicians to withhold or otherwise delay costly care.

    UnitedHealth now controls around 90,000 of the 950,000 physicians in the US. It is adding multispecialty physician groups in large numbers. These physicians all work for Optum Health, a subsidiary of UnitedHealth.

    UnitedHealth’s ownership or control of these physicians is endangering people’s health. There’s no good independent data to evaluate the consequences of UnitedHealth’s ownership of these physicians. Based on the horror stories reported in the press–from insurer use of AI to conduct massive denials of care without regard to particular patient needs, to inappropriate withholding of payment to hospitals and “ghost” networks–UnitedHealth is interfering in the practice of medicine to the detriment of its enrollees.

    Some experts suggest that there could be some good in what UnitedHealth is doing. But without data to conduct independent assessments and with mountains of horror stories, these experts are likely dreaming. Insurer control of physicians means putting profits ahead of patient needs, with potentially horrific consequences.

    One recent study published in JAMA finds that private equity ownership of physician groups has driven up health care prices. That study looked at dermatology, gastroenterology, and ophthalmology practices. Several other studies have had similar findings, including one on private equity ownership of dental practices. Nursing homes, emergency medicine, urology and cardiology practices are all being taken over by private equity and corporations.

    The Biden administration has focused some attention on anti-trust issues, but it seems that the anti-trust train left the station a long time ago and undoing the damage that has already been wrought would be a very heavy lift. Moreover, when insurers hire physicians, rather than acquiring them, they are not subject to anti-trust laws.

    The dangers to patient health from the corporatization of healthcare are potentially massive, with costly care particularly hard to come by. Insurer ownership or control of physician practices is hurting physicians as well. They may no longer be able to practice the medicine they think is in their patients’ interest.

    Recently, UnitedHealth and Humana have been sued for using AI algorithms to deny patient care, overruling treating physicians, and overlooking the particular needs of their enrollees in Medicare Advantage plans.

    Here’s more from Just Care:

  • Private equity profiting wildly on home care at the expense of older adults

    Private equity profiting wildly on home care at the expense of older adults

    A new report from the Center for Economic and Policy Research, “Profiting at the Expense of Seniors: The Financialization of Home Health Care,” finds that new policies at the Centers for Medicare and Medicaid Services (CMS), which administers Medicare, let private equity and other corporate players profit wildly from owning home health care agencies. At the same time, these corporate players shortchange people with Medicare, keeping them from getting medically necessary home care that Medicare covers.

    Unlike in days of yore when home care agencies were often mom and pop shops and nonprofit agencies, today private equity firms and health insurance companies often own home health care agencies. And, their incentive is to stint on care. The less care they cover, the more they profit. So, they override your treating physician regarding the care you need. They tend to think you don’t need care or need less care.

    CMS says it wants to crack down on fraud. But, in many ways, it is encourage it, allowing health insurance companies and private equity firms to direct care and not overseeing these profit-maximizing entities or holding them accountable for their bad acts.

    The fraud and bad acts go beyond home health care; it is pervasive in Medicare Advantage. The CMS Medicare Advantage payment system is defective, allowing corporate insurers who run Medicare Advantage plans to charge the government way more for their services than is appropriate. By CEPR’s calculations, based on various Medicare Payment Advisory Commission (MedPac) studies, Medicare Advantage plans receive about 19 percent more for each enrollee than CMS spends on people in traditional Medicare.

    Corporate insurance company overcharges drive up Medicare Part B premiums for everyone with Medicare. As a result, people in Original Medicare are helping to subsidize the corporate health insurers running Medicare Advantage. Everyone, including taxpayers, are paying more for Medicare than they should be paying.

    “Medicare services are almost entirely funded by the payroll taxes of working people. They deserve a health care system in their older years that is patient-centered, not profit-driven,” said Eileen Appelbaum, one of the authors of the report. “The goal of CMS is to change Medicare as we know it by 2030, and Congress  must rise to the occasion to protect patients and taxpayers.”

    Among other things, the report’s authors recommend that Congress strengthen Traditional Medicare. CMS also must oversee the insurance companies and private equity firms operating home health agencies and hold them accountable for their bad acts.

    Here’s more from Just Care:

  • How former CMS head, Tom Scully, privatized and destroyed Medicare

    How former CMS head, Tom Scully, privatized and destroyed Medicare

    David Dayen reports on former Center for Medicare and Medicaid Services (CMS) head, Tom Scully, privatized and destroyed Medicare for The American Prospect.

    Back in 2002, Scully, the administrator at CMS under President George W. Bush, attacked the incentives in the Medicare program. At the time, he was focused on hospital incentives to inflate patient costs, saying “People follow the money, and they’ll find the little niches in the program and they’ll game it, and that’s what happened here.”

    Scully, himself, has taken advantage of these “niches” since leaving government in 2003 for private equity. Scully’s view about health care is Darwinian. People should pay out of pocket for their health care, as they do for their vegetables–survival of the fittest–with help only for the poor.

    Scully doesn’t recognize the value of Medicare negotiating prices for physicians and hospitals. Of course, that’s what has kept Medicare spending down for older Americans and people with disabilities. It’s also one key way other countries get value from their health care systems. In Scully’s view, if you get sick, you should pay for it.

    It’s thinking like Scully’s that has pretty much destroyed our health care system. Physicians and patients have suffered as private equity and big corporations have seen their profits soar. “Scully’s fear of big-government price-fixers has led to the triumph of big private profit-takers, at the cost of doctors, nurses, and patient care.”

    The corporate takeover of health care has also made navigating the system challenging. It’s now so complex. Choice and competition are meaningless. They have not improved quality and they have only increased costs. Unlike with airline travel, restaurants, housing or automobiles, you have virtually no idea if the health plan you choose will deny and delay your care and endanger your health. All you know is that there’s a decent chance that your insurer will not cover your care.

    Health care corporations are in business to help their investors first and foremost. And, in the health care space, they can do so pretty easily, with little accountability, by simply extracting money from the system. Scully knows this full well and helped conceive, design and implement the algorithms that now power NaviHealth–a software AI system that helps insurers to keep more of their government payments by denying or limiting home health, nursing and rehab coverage.

    Scully sold NaviHealth before it was bought by Optum, a division of UnitedHealth. He then went on to push Congress to allow for-profit PACE programs and to invest in InnovAge, which was buying up PACE programs. Soon after, CMS addressed allegations that InnovAge was denying thousands of PACE patients medically necessary services and suspended enrollment in many of InnovAge PACE programs for a time.

    As former head of the Center for Medicare and Medicaid Innovation at the Centers for Medicare and Medicaid Services, Rick Gilfillan, explains: “When you privatize social goods like health care, you end up getting the worst of both worlds. Because it’s seen as a public good, you can’t let the marketplace operate as it normally would … you get captured regulatory processes that end up facilitating the extraction of wealth by the private sector.”

    Here’s more from Just Care:

  • Private equity buying up specialists and driving up health care costs

    Private equity buying up specialists and driving up health care costs

    Reed Abelson and Margot Sanger-Katz report for The New York Times on private equity’s growing role in health care. The New York Times story is based on a new report from the Antitrust Institute finding that private equity is buying up specialist practices and driving up health care prices and expenses in the process.

    Private equity sees big dollars in health care and is paying big money to own physician practices all over the country, at a rapid rate. In 13 percent of the country, private equity owns more than 50 percent of physician practices, which means higher costs for everyone. In markets with the highest private equity penetration, health care costs are rising most dramatically. In cases where private equity controlled more than 30 percent of the market, gastroenterology, dermatology, and obstetrics and gynecology costs rose by double digits.

    Private equity firms appear to see value in owning many, if not all, physician specialists as well as primary care practices. Private equity firms have focused on urology, ophthalmology, cardiology, oncology, radiology and orthopedics. Once they have a solid share of the specialty market they demand higher prices from insurance companies.

    Insurance companies, in turn, must pay these private-equity owned practices higher prices in order to have enough specialists in their networks. And, if insurance companies are paying more, you better believe that your health insurance premiums are rising, along with deductibles and copays.

    Thankfully, Traditional Medicare has fixed provider rates. But, if Medicare Advantage takes over Medicare, (as it will likely do if Congress does not act soon,) Medicare Advantage plans will not have the leverage to negotiate Medicare rates and costs will rise dramatically in Medicare Advantage.

    Alternatively, the federal government could require Medicare Advantage plans to pay Medicare rates. The private equity-owned practices would likely have to honor those rates to ensure they have enough patients. The Medicare population tends to make up a significant portion of specialists’ patients.

    Here’s more from Just Care:

  • Rents soar for older adults in private-equity owned senior housing

    Rents soar for older adults in private-equity owned senior housing

    Rebecca Burns reports for The Lever on the plight of older adults living in private-equity-owned senior housing. The bottom line: Watch out, private equity is buying up senior housing and hiking up rents; older adults are at risk of eviction.

    Background: Older adults need affordable places to live, where they can age in communities with strong support systems. There are some good options, but many options are unaffordable. Seeing an opportunity for big profits, private equity has stepped in to the senior housing market.

    But, be it senior housing or nursing home care, private equity is watching out for its investors first and foremost, not older adults. In the nursing home arena, private equity firms have lost business as a result of a sharp rise in Covid-19 deaths. To maximize profits, they cut staff. Stories abound of residents not being cared for.  The federal government has not addressed this crisis yet. President Joe Biden said in his State of the Union address last year that this type of predatory behavior “ends on my watch.”

    Wall Street firms have still done well in the nursing home arena, while older adults have struggled. In private-equity-owned nursing homes, at least one group of researchers has found that resident death rates were up by 10 percent. The private equity firms reduce staffing to increase profits. One study found a 50 percent increase in use of anti-psychotic medicines at private-equity owned nursing homes; it was the owners’ way of compensating for fewer staff.

    “Wellness” housing for seniors: Many Wall Street players have moved into owning and renting out “wellness” housing units to older adults. Wellness housing does not require nursing staff. Wellness housing is different from assisted living facilities and does not provide long-term care services. Investors count on older adults to be able to pay the rent with the proceeds they received from selling their homes.

    Welltower is a real estate investment trust or (REIT) that owns thousands of units of housing for older adults, as well as 2,000 health care facilities. Welltower and other private-equity-backed firms see big dollar signs in the senior housing and health care markets.

    One emerging crisis for people living in private-equity owned senior housing is big unexpected rent hikes. Welltower, for example, is raising rents on its housing far more than other landlords to increase profits. It can do so because the supply of affordable housing for older adults is very limited. And, Welltower owns a larger amount of moderately priced housing for older adults than any other company.

    Companies like Welltower lure older adults to move into them with the promise of small rent increases, community and a vast array of amenities. Still, one resident whom The Lever profiled arrived at his unit only to find that even basic safety features were not in place. Soon after, residents were told that their rents were rising as much as 39 percent, more than four times the increases in adjacent communities.

    The federal government helps Welltower to profit handsomely. As a REIT, Welltower benefits from federal tax-exempt status. It gets a big tax subsidy. The goal of the tax subsidy was to incentivize investments that delivered positive outcomes. Instead it is subsidizing investments that make housing unaffordable for older adults.

    The federal government also gave Welltower $65 million in Covid funds. The money was intended for health care providers. What is the federal government doing to help older adults who need affordable housing?

    Here’s more from Just Care:

  • Private equity buying up orthopedics practices

    Private equity buying up orthopedics practices

    Harris Meyer reports for Kaiser Health News on the rise in private equity ownership of orthopedics practices. At least some large orthopedics practices have not been able to stay afloat financially. Instead of selling themselves to large hospital systems or health insurance companies, they have allowed private equity firms to buy them. Based on what we know about private equity ownership in dental care, eye care, emergency room services and more, Americans should be prepared to see costs increase and quality of care suffer for orthopedics services.

    Tip: If you need orthopedic surgery, do your homework. Make sure that the specialist you choose puts patients first and is not being directed to deliver less than you need.

    In 2021, orthopedic surgeons earned an average of $634,000. Private equity ownership gives these specialists a big upfront payment. In theory, private equity ownership could reduce orthopedic surgery costs through reliance on lower cost outpatient surgery out of a hospital system. In practice, it is more likely to lead to higher costs for both insurance companies and patients.

    One study published in JAMA Network looked at 578 private equity owned dermatology, gastroenterology, and ophthalmology physician practices. Within two years of private equity ownership, charges were 20 percent more than at places that were not private-equity owned. There is also data showing that physicians working for private equity firms are often pressured to do more with less help, which could mean poorer quality care.

    One chief medical officer of an orthopedics group that refused to sell themselves to a private equity company said that the only goal of private equity is to make greater profits and then sell. The only way they succeed is by expecting physicians to work more and do less.

    Private equity is still relatively new to medicine. Companies only began buying orthopedics practices in 2017. But, many private-equity owned orthopedics practices are now for sale again. Georgia, Texas, Florida and Colorado, along with eight other states have seen the greatest buyout of orthopedic practices by private equity.

    Why is private equity looking at orthopedic practices? You guessed it. It’s following the money. Patients spend almost $50 billion each year for orthopedic surgery to treat back pain alone!  Then, there’s all those knee and hip replacements, which many people need.  One knee replacement can easily cost more than $40,000.

    Some physicians, whose businesses are now owned by private equity, claim that they are still in charge. They don’t see any changes. If you ask me, if they haven’t yet, they will. It’s only a matter of time.

    One expert explains that private equity is looking at short-term returns. That likely means that in a capitated payment system, where the physicians are paid a flat fee for their work, physicians will do less than people need. In a fee-for-service system, they will do more than needed.

    Right now, the future of independent physicians looks pretty grim.

    Here’s more from Just Care: