Key Takeaways
- • Researchers at Brown University's School of Public Health launched the Private Equity State Tracker, an interactive tool mapping PE investments across hospitals and nine medical specialties in all 50 U.S. states from 2015 to 2023.
- • PE firms invested approximately $750 billion in healthcare between 2010 and 2020 using a "platform and add-on" acquisition strategy, where large practices are purchased and expanded through smaller facility acquisitions.
- • Research findings show PE acquisition of physician practices correlates with increased healthcare prices and spending, according to a report prepared for the National Academy for State Health Policy and the Commonwealth Fund.
- • Many PE acquisitions of small hospitals fall below mandatory federal transaction reporting thresholds, enabling large-scale consolidation to occur outside traditional antitrust oversight mechanisms.
- • The tracker tracks more than 6,000 private equity investments in healthcare, addressing what researchers describe as significant gaps in ownership transparency and systematic disclosure of PE healthcare deals.
Summary
Researchers at Brown University's School of Public Health Center for Advancing Health Policy through Research have released the Private Equity State Tracker, a new interactive tool designed to illuminate the scale and scope of private equity involvement in U.S. healthcare. The tracker displays PE expansion through acquisitions in hospitals and nine medical specialties across the nation between 2015 and 2023, drawing on data from PitchBook, Medicare provider practice records, and other public sources. The initiative addresses what researchers characterize as a lack of transparency surrounding PE healthcare transactions and their effects on the healthcare system.
According to the accompanying research report prepared for the National Academy for State Health Policy and the Commonwealth Fund, empirical evidence demonstrates that PE acquisition of physician practices is associated with increases in healthcare prices and spending. Andrew Ryan, professor of health services, policy and practice and director of CAHPR, explained that the fundamental PE operating model centers on "investor-driven enterprise," where firms pursue "large margins and then sell again in a short time period." Between 2010 and 2020, PE firms deployed approximately $750 billion in healthcare investments, primarily through a "platform and add-on" strategy in which a large medical practice is acquired and then expanded by purchasing smaller facilities.
A critical structural vulnerability identified in the research concerns transaction reporting requirements. Many PE acquisitions of small hospitals occur below the national threshold triggering mandatory transaction reporting, allowing firms to complete large-scale purchases outside traditional antitrust oversight. This reporting gap means current PE consolidation numbers may substantially underestimate actual investment volumes. Megha Reddy, project manager at SPH, emphasized the importance of ownership transparency and systematic disclosure requirements, noting that transparency benefits patient autonomy by enabling informed price comparisons across institutions. The tracker, which monitors more than 6,000 PE investments in healthcare, represents an effort to fill this transparency gap at the state and national level.
According to the accompanying research report prepared for the National Academy for State Health Policy and the Commonwealth Fund, empirical evidence demonstrates that PE acquisition of physician practices is associated with increases in healthcare prices and spending. Andrew Ryan, professor of health services, policy and practice and director of CAHPR, explained that the fundamental PE operating model centers on "investor-driven enterprise," where firms pursue "large margins and then sell again in a short time period." Between 2010 and 2020, PE firms deployed approximately $750 billion in healthcare investments, primarily through a "platform and add-on" strategy in which a large medical practice is acquired and then expanded by purchasing smaller facilities.
A critical structural vulnerability identified in the research concerns transaction reporting requirements. Many PE acquisitions of small hospitals occur below the national threshold triggering mandatory transaction reporting, allowing firms to complete large-scale purchases outside traditional antitrust oversight. This reporting gap means current PE consolidation numbers may substantially underestimate actual investment volumes. Megha Reddy, project manager at SPH, emphasized the importance of ownership transparency and systematic disclosure requirements, noting that transparency benefits patient autonomy by enabling informed price comparisons across institutions. The tracker, which monitors more than 6,000 PE investments in healthcare, represents an effort to fill this transparency gap at the state and national level.
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