The recent release of the report, Monetizing Medicine: Private Equity and Competition in Physician Practice Markets, a collaboration between the American Antitrust Institute (AAI), University of California at Berkeley (UCB) Petris Center on Health Care Markets and Consumer Welfare, and the Washington Center for Equitable Growth (Equitable Growth), has drawn attention across various media outlets.
Below is a running list of press coverage:
The New York Times: Who Employs Your Doctor? Increasingly, a Private Equity Firm.
“A new study finds that private equity firms own more than half of all specialists in certain U.S. markets.
In recent years, private equity firms have been gobbling up physician practices to form powerful medical groups across the country, according to a new report released Monday.
In more than a quarter of local markets — in places like Tucson, Ariz.; Columbus, Ohio; and Providence, R.I. — a single private equity firm owned more than 30 percent of practices in a given specialty in 2021. In 13 percent of the markets, the firms owned groups employing more than half the local specialists.
The medical groups were associated with higher prices in their respective markets, particularly when they controlled a dominant share, according to a paper by researchers at the Petris Center at the University of California, Berkeley, and the Washington Center for Equitable Growth, a progressive think tank in Washington, D.C. When a firm controlled more than 30 percent of the market, the cost of care in three specialties — gastroenterology, dermatology, and obstetrics and gynecology — increased by double digits.”
The Washington Post: Private equity investors raising U.S. medical prices, study says
“The study focused on private equity “roll ups” of physician practices, in which investors buy up several doctor groups in a city, consolidating a significant share of the market which they can use to raise prices.
The report found that “PE acquisitions are associated with price increases in 8 of 10 specialties, and that these price increases are particularly high in [metropolitan areas] where a single PE firm controls more than 30% of the market.”
For example, prices for gastroenterologists jumped 14 percent, for oncologists they rose 16 percent and for ophthalmologists it was 9 percent, according to the research, a project from the University of California at Berkeley, the Washington Center for Equitable Growth and the American Antitrust Institute.
Price hikes were higher when a private equity-owned practice controlled a large share of the market. The study found that the number of metropolitan areas in which a private equity firm served half or more of a market rose from a handful in 2012 to 50 in 2021.
The study reported that private equity firms have shown increasing interest in acquiring physician practices, with the number of deals studied rising from 75 in 2012 to 484 in 2021. The largest number of deals occurred in dermatology, ophthalmology, gastroenterology and primary care. The other specialties considered in the study were cardiology, oncology, obstetrics and gynecology, orthopedics, urology, and radiology.
The private equity acquisitions were often focused on a particular local market, a strategy that sometimes gave their enlarged “roll ups” significant market share.
“Private equity firms are gaining control of markets and increasing prices,” the authors concluded.”
Advisory Board: PE firms own over 30% of physician practices in some markets
“According to a new report published by the American Antitrust Institute, private equity (PE) firms have purchased a substantial number of physician practices over the last decade, with some firms owning over 30% of practices in a given specialty in some markets.”
Healthcare Innovation: Report Analyzes Impact of Private Equity Acquisition of Physician Practices
“The authors stress that their findings should draw significant attention by competition enforcers and healthcare policymakers. For example, the number of private equity acquisitions of physician practices has grown six-fold between 2012 and 2021. Some markets have been highly penetrated by private equity, with a single private equity firm holding more than 30 percent in one or more physician specialties. The study compares price increases in those markets to all markets and finds they are almost 1.5 to over 3 times higher. This is true for areas of medicine such as: gastroenterology, dermatology and obstetrics & gynecology.”
CNBC: Biden administration asserts power to seize drug patents in move to slash high prices
“Also on Thursday, the Biden administration unveiled efforts that aim to counter allegedly anti-competitive practices by big health-care companies.
Some target private equity firms, which have been buying up physician practices, nursing homes and other health-care providers. Private equity ownership in the health-care industry has ballooned, with approximately $750 billion in deals between 2010 and 2020, according to a report from the American Antitrust Institute.”
The Hill: Private equity is buying up health care, but the real problem is why doctors are selling
“Consolidation in health care isn’t new. For decades, physician practices have been swallowed up by hospital systems. According to a study by the Physicians Advocacy Institute, nearly 75 percent of physicians now work for a hospital or corporate owner. While hospitals continue to drive consolidation, private equity is ramping up its spending and market share. One recent report [published by AAI] found that private equity now owns more than 30 percent of practices in nearly one-third of metropolitan areas.”
