Vermont Becomes Latest State to Limit Private Equity's Influence on Healthcare [View all]

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(cross posting from the Health Group)

https://www.democraticunderground.com/114239414

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Vermont is now the third state, after Oregon and California, to pass new restrictions on the corporate practice of medicine since the start of last year. In addition, states including Massachusetts and Indiana recently enacted laws to scrutinize private equity’s healthcare investments. Connecticut last month passed a law to ban a type of transaction critics say private-equity firms use to extract money from hospitals.

The action may soon shift to the federal level. The American Medical Association, the nation’s largest doctors’ group, last week voted to seek a nationwide prohibition on corporate interference with physicians’ patient care, and to oppose certain legal structures commonly used by private-equity firms to invest in healthcare practices.

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These actions reflect how public opinion may be moving against private equity’s activities in the medical sector. The bankruptcies of formerly private equity-backed hospital operators Steward Health Care System and Prospect Medical Holdings in 2024 and 2025, which led to hospital closures and cost taxpayers tens of millions of dollars, helped galvanize anti-private-equity sentiment.

In addition, a growing body of research suggests private-equity investment can lead to higher medical costs and worse care. For instance, last year researchers at Harvard Medical School, the University of Pittsburgh and the University of Chicago found that patient deaths increase at hospitals that are taken over by private equity.

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https://archive.ph/XsQVw