we believe in:
People over profit in healthcare
We are speech, occupational, and physical therapists who have seen the devastating impact of private equity in healthcare, and we are here to use our voices to ensure that anyone who is involved in healthcare values people over profit.
Private equity ≠ sound healthcare
We believe that healthcare should be protected from private equity investment due to the fact that the private equity business model is fundamentally incompatible with sound healthcare that serves patients.
PRIVATE EQUITY GAMES THE SYSTEM
We believe that the games that private equity firms play in order to maximize profits and monopolize markets help make the rich richer and in turn, hurt patients, healthcare workers, and communities.
Site curator: Megan Berg, MA, SLP
Our Mission & Vision
This site is curated by Megan Berg, MA, SLP, founder of Therapy Insights. The site exists to provide a way for therapists to learn more about how private equity impacts our patients and our careers as well as to provide solid action steps you can take to help end private equity’s destruction of the American healthcare system. If you would like to contribute to this website, including sharing your testimonial or letter to legislators, please email Megan at [email protected].
Billion dollars in private equity deal values in 2010
Billion dollars in private equity deal values in 2019
increase in healthcare costs in 2020
Private equity impact on acute, post-acute, and long-term rehabilitation
- A February 2021 study from the National Bureau of Economic Research found that going to a facility owned by a private equity firm increased the chance that a resident would die by 10%, compared with living in another type of facility.
- Therapists are pressured to do group therapy, even when individual 1:1 therapy is warranted. This can look like selecting a single task that does not fully address the unique needs of all of the patients in the group, thus wasting Medicare and Medicaid dollars and reducing quality of therapy outcomes.
- Therapists are pressured to bill as many patients as possible within a facility, whether they need therapy or not.
- Clinicians are pressured to complete paperwork at point of service.
- Nursing staff ratios are reduced.
- Productivity requirements of therapists are increased to unethical levels (e.g., 90%, which leaves not enough time for a therapist to use the restroom in between sessions).
- Patient care supplies are reduced.
- Building maintenance is deprioritized.
- Reduction in non-required staff (e.g., activities, chaplains).
- Poor retention of PRN staff and pressuring therapists to come in when they’re sick.
- Refusal to purchase resources and equipment for therapists that are required to do their job.
- Elimination of in-house therapy departments within hospital infrastructure in favor of contract therapy companies, which can be better managed from a profiteering standpoint
- Limited support for therapeutic services that have a positive impact on the patient’s function in life but have a low impact on the profit margin. This can impact the quality of therapists in these roles, cause burnout, and impact the therapy department overall.
- Decreased time spent on improving the therapeutic practices of the department and impacting the patient’s recovery.
- Less time the patient spends with the therapist which impacts appropriate clinical decision making and can increase re-admission or limited carrythrough of next level of care.
- Impacts noted throughout the hospital include a reduction of staff which can decrease safety and erodes the opportunity for establishing the patient’s health literacy. This reduces attendance with follow-up appointments and adherence to medical and discharge recommendations.
- Reducing the opportunity for support groups, community events, and educational opportunities.
Nursing homes: The canary in the coal mine
Skilled nursing facilities have been the primary target of private equity firms, largely due to the ability to game the Centers for Medicare and Medicaid (CMS) reimbursement system with so many of the patients enrolled in Medicare. With the success of this arrangement, private equity firms are now moving into other areas of healthcare, targeting younger patient populations and a broader range of healthcare facilities and businesses. The American Medical Association in their 2018 report, noted a trend of private equity firms buying up multiple practices in an area and then rapidly “flipping” them, selling them off to other private equity firms who in turn poorly manage the businesses by putting profit before people. These private equity firms have a reputation of threatening small business owners (e.g., “If you don’t sell to us, we will open 20 offices in your catchment area to compete against you.”) and this is resulting in scenarios where physicians lose all autonomy and eventually become “indentured servants,” (their words not ours). (YPS Report: The Role of Private Equity in Medicine, AMA Report, Missouri Medicine, 2018).
If we do not act now to regulate private equity investment in healthcare, the trend will continue and it won’t be long before only a handful of large for-profit private equity firms own the majority of all healthcare facilities in the United States, effectively controlling CMS reimbursement rates and making it virtually impossible for small business private practice owners to survive.
The effect of private equity in private practice therapy clinics
- Centers for Medicare and Medicaid yearly and ongoing reduction in fee schedule devalues the work of private practice owners who devote their small businesses to creating client centered therapy programs in order to maximize a patient’s independence.
- Untimed codes cause time sensitivity and pressure to daily scheduling that often prevents the deserving patient from receiving the recommended duration of treatment.
- With ongoing reduction in reimbursement, private practice owners are losing morale and hope after having to cut staff pay and/or reduce the number of Medicare/Medicaid patients accepted, which reduces skilled care options from both rural and urban locations and decreases the patient’s ability to return to life and work.
- Without private practice options for patients post rehabilitation, people have fewer options for ongoing progress.
- Reduction in provision of Med B in the home services as private practices are financially unable to support this service delivery model based on falling reimbursement and increasing travel expenses
- Reduced access to rehabilitation services as private practice owners close doors, driving outpatient healthcare organization caseloads higher
How private equity impacts speech, occupational, and physical therapy
Private equity firms buy up skilled nursing facilities, hospitals, clinics, therapy contract companies, and private practices. Sometimes they purchase them one by one, other times they purchase them as a package buy-out from another private equity firm.
Private equity firm maximizes profits by pressuring therapists to see patients in groups and provide POS documentation. They also cut staff, reduce staff:patient ratios, increase productivity requirement, cut resource budgets, etc.
Centers for Medicare and Medicaid (CMS) cannot afford to reimburse the private equity firms because they didn’t budget for such drastic increases in cost.
Congress votes to reduce Medicare reimbursement rates in order to balance the budget and be able to pay for all of the billing codes. Because CMS sets the tone, private insurance also cuts rates.
What you can do
In 2019, the American Investment Council spent $2,511,000 on lobbyists* to spread their message that, “Private equity builds better businesses across America, supports millions of jobs, and delivers the strongest returns to support the retirements of millions of workers.” We know this isn’t true. Private equity monopolizes industries, cuts jobs, kills careers, and values profits over people, every single time. We need to collectively raise our voices to fight this narrative to save healthcare in the United States.
Keep scrolling to learn how you can take all of the action steps listed here.
Write to your legislators
talk with your colleagues
Get your state association involved
Therapists, before you read further: Know that you do not need to take all of the steps laid out on this website. You can start with just the first one, and if it feels good to move to the next step, go for it! The important thing is to do what you can with the time and energy you have, and know that change will take time. We can ALL be a part of the solution that leaves things better off for the next generation!
Your voice matters
There are over 700,000 of us.
There are over 120,094 speech pathologists currently employed in the United States.
There are over 141,405 occupational therapists and OTAs currently employed in the United States.
There are over 312,500 licensed physical therapists and 127,750 licensed physical therapist assistants in the United States.
If the only voices being heard by legislators are the lobbyists of private equity firms, we will never see progress. But if each of us speaks up and talks to our legislators about what we’re seeing, things can change.
The first step you can take is to become informed about this issue. This puts you in a position to better advocate for our field. There are many layers to this issue and lots of different stakeholders. Ultimately, we need to understand how private equity firms buy up healthcare facilities and therapy contract companies, and then utilize them as assets designed to churn out profits for shareholders. A significant amount of new resources have been published in this topic within the last few years and more research is emerging. If you have sources you’d like to add to this collection, please email [email protected].
If you have time, keep reading
Please refer to this shared folder » for publications related to the effect of private equity in healthcare.
Sign up for email alerts
The Private Equity Stakeholder Project has excellent email alerts about new updates regarding private equity in healthcare. It’s an easy way to stay informed. You can sign up for their emails here »
Make noise about the Stop Wall Street Looting Act
United States Senators Warren (Mass.), Baldwin (Wisc.), Brown (Ohio), and Representatives Pocan (Wisc.) and Jayapal (Wash.), introduced the Stop Wall Street Looting Act into the 2021-2022 session.
“Predatory private equity managers attack our communities, using huge piles of borrowed money to gentrify our neighborhoods, kill our jobs, steal our pensions and snatch away our healthcare. Now we’re fighting back — Senator Warren’s bill strikes a blow against private equity greed and extraction to protect our people and stop runaway inequality,”
— Ana Maria Archila, co-Executive Director of the Center for Popular Democracy
Write a letter to legislators
Need a place to start? You can view Megan Berg’s letter here. Remember: Your letter means more when it’s coming from YOU and YOUR experiences. Form letters lack energy. Write about what YOU are seeing in YOUR community. That’s what legislators need to hear about.
Talk with your colleagues
Ask any speech, occupational, or physical therapist what some of their biggest challenges are today, and they will likely be something along the lines of…
- Low wages (or staff cuts)
- Lack of equipment and resources
- Impossible productivity standards
- Lack of ethical leadership
- Burn-out from witnessing poor patient care
- Concerns aren’t heard or addressed
We need to attack the root of the problem: The growing power and influence of equity firms as they buy up and monopolize healthcare facilities and therapy contract companies. All of these issues can be addressed if we change who is in control of making decisions.
More voices = bigger impact.
Be an accountability buddy
Find a friend or colleague who will keep you accountable to write a letter or help you start a group conversation with your therapy colleagues. Grassroots change is more fun and more powerful when we do it together!
Get your state association involved
State associations are uniquely positioned to engage with local lobbyists to educate legislators on these issues.
You can also utilize your state association’s network to connect with other professionals facing the same challenges as you.
Together, you can:
- Request a meeting with your state legislator and attend together to present a unified message about the effects of private equity on your career, your patients, and your community.
- Instigate meetings across multiple settings to discuss the issue and work towards solutions (use the poster download from step #3 above).
Contact your state association
See if there is any room in the budget to address this issue with their lobbyist. If you can, offer to volunteer your time to help coordinate this.
Share this website
If your state association has a way of communicating with other members via a forum, share this website!
Do you have a 401k or other investment portfolio account? Do you know where your money is being invested? We as investors can take a stand by refusing to invest our money in the companies that are gaming the Centers for Medicare and Medicaid (CMS) and private insurance systems and making healthcare worse off for everyone.
Download this PDF
This report: Pulling Back the Veil on Today’s Private Equity Ownership of Nursing Homes highlights some of the known current private equity owners of nursing homes. Download it here »
Change your investments
If you can, work with your financial planner or investment company to remove any funds from these private equity firms.
Therapists are given the resources they need to do their jobs, including access to equipment and resources. Patients are allotted an appropriate number of therapy sessions to make a difference in their quality of life. Therapists aren’t required to do unethical things like point-of-service documentation for every single patient or grouping patients for therapy sessions in order to maximize billing profit and reduce staffing ratios. CMS stops cutting reimbursement rates because the system isn’t being corrupted by private equity firms whose only goal is to make as much money as possible as fast as possible. Imagine! This can only happen if we use our voices to tell the world about what’s going on.
These are our stories
Share your perspective!
With my speech pathology experience, I was able to further foster my passion for helping adults regain their participation in life. My specialized service-based speech pathology private practice has created an opportunity to fully support my clients and their families by helping them understand the neurological conditions they are faced with and how to pick up the pieces. Additionally, for those that do not have access to technology due to disability or financial reasons, I have been able to commute to their dining rooms. My in-home speech therapy service helps the client regain their speech, voice, thinking, and swallowing functioning with consideration for their best recovery options and physical disabilities. In addition to virtual and in-person care, I have been able to care for the client in ways that a facility cannot because of the restrictions in their clinic-based model, high productivity requirements, and limited support on being able to focus on the client’s holistic needs. As the CMS reimbursement continues to be cut, I am being forced to reduce my travel radius which will take away from the skilled speech pathology specialty service to clients in my region.
Andrea Malsom, MA CCC-SLP
I am what I call, “retired” due the existence of private equity in healthcare.
Although I am only 3 months into my new career as a Business Development Representative in the tech industry, I remember the denial and anger—grief, if you will, that I experienced as I was emotionally leaving speech therapy after serving for 7 years. To further clarify, I did not leave speech therapy because of the actual profession, I left because of the system that controls it and how it dictated my livelihood. It made me sad, angry, and helpless. As a “servant” working for these for-profit therapy companies who are owned by private equity firms, I no longer qualified for PSLF (public service loan forgiveness), even though we were getting a large amount of fixed government reimbursements.
I am not paid enough as an SLP. This is not entitlement. I am simply subject to government reimbursement as a servant to my community. And it is a very, very traumatic experience to not only get a pay cut every year because these companies have to turn a certain profit, but to also be unable to pay for your education, whether grad school or CEUs. I had to leave as it was literally destroying my life financially and emotionally.