FILE – A hospital exam room is seen in Alabama on Thursday, July 30, 2015. A large Swedish study, published Wednesday, Dec. 13, 2023, in JAMA Psychiatry, has uncovered a paradox about people diagnosed with an excessive fear of serious illness: They tend to die earlier than people who aren’t hypervigilant about health concerns. (AP Photo/Brynn Anderson, File)
(NewsNation) — Hospitals bought by private equity firms saw an uptick in the number of adverse medical events among patients following the purchase, according to a new study that examined the effects of such transactions.
The study, published Tuesday in JAMA, shows that within three years after a hospital’s acquisition, hospital-acquired adverse events jumped 25% among Medicare patients compared to similar hospitals not bought by investment firms. Those “adverse events ” include falls, central-line-associated bloodstream infections and surgical infections.
Researchers reported a 38% increase in central line-associated infections despite the hospitals placing 16% fewer central lines. They also found a 27% increase in falls.
“Such increases in hospital-acquired infections may result from decreased staffing, changes in operator technique, poorer clinician experience, increased patient illness, or other explanations,” the study authors wrote.
Although the study identified a rise in hospital errors, there was a slight decrease in in-hospital mortality rates, from 3.5% pre-acquisition to 3.2% post-acquisition. Researchers said that dip could be explained by a younger and lower-risk patient pool at the hospitals.
“Although adjustment for patient characteristics did not change this mortality estimate, younger Medicare beneficiaries (fewer of whom were dually eligible for Medicare and Medicaid) may have had other unobserved health or social advantages that contributed to lower in-hospital mortality,” the study authors wrote.
Researchers sought to study the impact of private equity acquisitions on health care outcomes. When investment firms and hedge funds buy properties, the goal is typically to streamline processes and improve efficiencies.
However, that’s often achieved by staff reductions and other cost-cutting measures, a scenario that’s notably played out among many local newspapers across the country.
This latest study adds to previous work that has examined hospital safety and how it’s affected by private equity firm acquisitions.
Dr. Ashish Jha, the dean of the Brown University School of Public Health, characterized the study as a “big deal.”
“It’s the first piece of data that I think pretty strongly suggests that there is a quality problem when private equity takes over,” he told the New York Times.
Drew Maloney, the chief executive of the American Investment Council, told the Times that private equity firms have played an “essential role” in helping local hospitals improve patient care.
“This research doesn’t reflect private equity’s full record of strengthening health care across the country,” he said.
Nonetheless, these investment firms have come under scrutiny and are now the subject of a congressional inquiry. The Senate Budget Committee announced earlier this month it was opening a bipartisan investigation into private equity ownership of America’s hospitals.
“Since coming under private equity ownership, many hospitals have experienced significant staffing reductions and substandard health care and have been stripped of valuable assets, including their real estate, leaving them saddled with debt,” the committee said in a news release at the time. “To assess the impact of these transactions and address their harmful effects, the senators are asking for documents and detailed answers about related-party transactions and the degree to which the private equity firms are calling the shots at these hospitals.”
