Across the United States, private equity ownership in the health care sector is under scrutiny as it has been linked to higher prices, increased medical debt, and lower quality of care. This trend has also resulted in financial harm, leading to the closure of safety-net hospitals. Amid growing concerns, lawmakers at both state and federal levels are taking steps to regulate the influence of private equity firms on health care providers.
Senator Elizabeth Warren (D-Mass.) is at the forefront of this legislative push. She has introduced legislation aimed at regulating private equity in health care and plans to revive her efforts against the industry. States like Maine have proposed bills to halt private equity acquisitions of hospitals. Meanwhile, California, Connecticut, Indiana, Oregon, and Texas are considering similar measures to address the growing control of health care providers by out-of-state for-profit entities.
A bipartisan Congressional report, initiated by Senator Chuck Grassley (R-Iowa), highlighted that financial interests often take precedence over patient care in deals involving private equity firms. In response, Massachusetts Governor Maura Healey recently signed a law to expand state oversight over health care transactions involving these firms. Pennsylvania Governor Josh Shapiro has also called for legislative action to grant the state’s attorney general review powers over such transactions.
The concern over private equity's impact on health care is widespread, with at least 13 states introducing 26 bills related to this issue recently. These legislative efforts reflect a growing consensus on the need for greater regulation and oversight.
Despite these moves, the American Investment Council, represented by CEO Drew Maloney, defends the role of private equity in health care. Maloney claims that private equity strengthens telehealth services, supports urgent care facilities in rural areas, and fosters medical innovations that save lives.
"Headline-seeking politicians continue to place misguided blame on our industry." – Drew Maloney, CEO of the American Investment Council
