06/15/2021 | Press release | Distributed by Public on 06/15/2021 14:25
ICYMI: New MedPAC Report Highlights Value of Private Equity Investments in Health Care
Private equity is improving patient care, providing capital, and innovating ways to drive down Medicare costs
This week, the Medicare Payment Advisory Commission (MedPAC) released a report, originally requested by the Chairman of the House Ways and Means Committee, examining the role private equity investments play in the health care sector. MedPAC's report reaffirms that private equity investments play an important role providing hospitals, nursing homes, and physician practices with capital and expertise to navigate an increasingly complex health care landscape. The report also described how private equity-backed providers and companies are improving the patient experience by innovating new health care delivery methods.
Unlike many of their previous reports, MedPAC did not issue any policy recommendations for Congress to consider regarding private equity. Copied below are some key takeaways from the report about how private equity plays an important role supporting nursing homes, hospitals, and physician practices across America.
Private equity can improve the quality of patient care - 'During our interviews, some physicians stated that PE firms are committed to providing patients with a positive experience so they can attract new patients. Another view is that PE acquisitions can improve quality of care because physicians no longer need to focus on running a business.' (Page 100)
Private equity improves efficiencies and provides access to needed resources:
Private equity-backed providers are pioneering at-home care - 'A third set of (PE-backed) companies focus on delivering primary care in beneficiaries' homes to improve their health and avoid expensive emergency room visits and inpatient stays. These companies use their own providers (usually nurse practitioners and physician assistants) to deliver the in-home care, and often focus on serving beneficiaries with complex health conditions.' (Page 104)
Private equity-backed providers and companies are improving the patient experience by innovating new health care delivery methods:
Private equity supports health plans for residents in long-term care facilities - 'Institutional special needs plans (I-SNPs) are specialized Medicare Advantage plans that restrict their enrollment to beneficiaries who need the level of care provided in a long-term care facility for 90 days or longer … PE firms have invested in companies that help launch and operate these new I-SNPs … Representatives for one of these companies believed that PE funding had played an important role in facilitating the company's expansion. The company had used the funding for a variety of purposes, including developing case management software that was better suited for institutional settings and hiring more capable staff.' (Pages 102-103)
Click here to learn more about how private equity is making critical investments in America's health care system.