7 ms·

Interesting. I'd like to see more action against the financialization of many other industries / domains, like healthcare and even housing, that I feel are not

Interesting. I'd like to see more action against the financialization of many other industries / domains, like healthcare and even housing, that I feel are not well served by a purely-market driven perspective. One wonders what the Private Equity firm's intention was here.

baggy_trough 4y ago
- markovbot 4y ago
  ah yes, a more profit driven healthcare sector, exactly what this country needs
  - whimsicalism 4y ago
    Shielding people from the actual prices does raise the actual prices typically.
    - Retric 4y ago
      Yet somehow market driven healthcare is almost universally more expensive, it’s like there are some monopolistic effects involved. For example several attempts to privatize the VA failed because of the vast increase in costs.
      - SoftTalker 4y ago
        Yes, when one mega-organization owns most or all of the health care providers in an area (which is very often the case) it's a monopoly and there is no market competition. Where I live for example, from a cost perspective I can't really shop around because there are no individual practices anymore. They (and the clincs and the hospitals) are all owned by the same vast medical congolmerate. It's completely anticompetitive, yet the FTC has not shown any concern AFAIK.
      - dado3212 4y ago
        The two driving forces for higher costs are subsidization of demand (gov't assistance + insurance, all of which have some pass-through effect on raising the cost of services), and artificial restriction of supply (it's hard to create a hospital/vet service/hire non-US doctors). Most market-driven healthcare approaches have been handicapped by one (or usually both) of those factors still being in play.
      - linuxftw 4y ago
        I have experience with the VA system. It's an absolute sham. Privatizing it would absolutely increase costs, because then people would actually been seen, let alone treated, for their conditions.
  - arrosenberg 4y ago
    OP isn't exactly wrong. Much of the regulation in housing and healthcare serves to benefit and entrench the incumbents into a non-market situation where the distributors control pricing power.
  - Xeoncross 4y ago
    Healthcare was more affordable back when individuals payed for it. The problem was that some could not, so we introduced insurance. At this point no one can afford it anymore without insurance. So our fix for one problem created a new problem.
    - markovbot 4y ago
      if only there was some kind of other option used by all developed countries except the US... too bad there isn't, i guess i'll just die when i cant afford healthcare
      - Xeoncross 4y ago
        What is the other option? Either insurance by private or government bodies or cash is all I've ever seen. Government and private insurance raises prices. Cash excludes poor people.
        deleted 4y ago
        [deleted]
        larkost 4y ago
        The other option is to have the government have a larger control, either by government run insurance, or by government run healthcare. There are numerous examples of either in the world that are both more effective by healthcare metrics and lower price than the current U.S. system. To be brutal about this: we in the U.S. demonstrably pay more per person that the rest of the "developed" world, and we get worse outcomes for it, and that is not even counting that we exclude a good portion of our population (which other countries do not). The only place the U.S. excels is at the very top of healthcare, the part that 1% of our population will ever see. We pay the top doctors the top dollar, so they come here, where they charge uber-top-dollar. At one point a lot of this was going to fund new drugs and clinical methods, which quickly filtered down to help everyone. But at this point those filter-downs are few and far between, and it is simply going to those who have the most money, or are the most visible.
- xtian 4y ago
  Based on what?
- alistairSH 4y ago
  would You're 100% confident in that assessment? I'm not going to claim less regulation could help control prices. The typical certificate of need process seems like something that could go away without much problem (I find it unlikely anybody would invest in a new hospital or whatever other facility without being relatively confident there's a market). But, regulation on drugs and devices probably should remain.
- mywittyname 4y ago
  The flaw in this idea is that there's no good way to introduce more competition to the market. The market is only going to continue to optimize for profit. The reason pricing isn't available is because that's negotiated between the provider and the insurance companies. Since most patients are using insurance, hospitals have to negotiate with some of the major insurance providers. Insurance companies do not want hospitals have transparent pricing, since they want people to buy insurance. Insurance companies also want uninsured people to pay a higher price, again, so people buy insurance. People can't choose their insurance providers because it's tied to their employment (in most cases). The market settled on this extremely convoluted system, which makes no sense to outsiders, specifically because it's so profitable. The only way out of it is through regulations that prohibit certain anti-competitive behavior, or for the establishment of competition in the insurance segment, which has no profit motive (and who would start a business with no profit motive?) Most parties kind of like the status quo. Insurance companies collect from employers, rather than individuals, so most people don't see the true cost of insurance. Hospitals get to charge insane amounts for certain procedures, since patients won't pay the entire bill, the insurance company will. And (upper-middle-class) patients are mostly happy, because healthcare feels cheap to them (since, again they never see the true cost they paid).
  - tyrfing 4y ago
    > The market settled on this extremely convoluted system, which makes no sense to outsiders, specifically because it's so profitable Which exact parties are extracting excess profits?
    - jessaustin 4y ago
      It's mostly health insurance firms. That's a much bigger sector in USA than it is anywhere else on earth.
      - tyrfing 4y ago
        Low single-digit operating margins aren't typically described as "so profitable" in any other context.
- munk-a 4y ago
  Never forget that every time an anti-regulation politician gets money under the table for helping to pass terrible market entrenching regulation they win twice: once when they bring home the cash and again when they have yet another example of poor regulation to drive home their ideology. Making broken regulations to entrench large market players is the most patriotic of pastimes in America.
bombcar 4y ago
There's a number of these where there's a desire to make it appear there is competition, but actually all are owned by the same conglomerate. I would be 0% surprised if similar things haven't been done or tried in optometry, dentists, etc.
- bobthepanda 4y ago
  Starbucks owns a bunch of “independent” shops
- riahi 4y ago
  See luxottica and their “brands”.
  - mywittyname 4y ago
    They even own the insurance company, EyeMed...
    - bombcar 4y ago
      I honestly think at some point this gets to the place of "operating under false pretences" to have so many brands that are actually the same company behind it. Perhaps "brought to you by HOLDING_COMPANY_X" should be required.
- 3maj 4y ago
  For the last 5-10 years one of the most popular strategies for mid-sized PE firms has been the dental clinic roll up.
  - monkeybutton 4y ago
    Funny you should say that: https://www.theglobeandmail.com/business/article-private-equity-buy-out-pharmacy-dental-office-veterinary-clinic/ https://www.theglobeandmail.com/business/article-private-equ...
- samstave 4y ago
subsubzero 4y ago
agree, it seems like almost every industry really has like maybe 3 at the most players and they are all gigantic and it is extremely non-competitive.
sdfhdhjdw3 4y ago
> One wonders what the Private Equity firm's intention was here. Gee, quite the conundrum.
markovbot 4y ago
> One wonders what the Private Equity firm's intention was here. no, i don't think anyone's wondering that. private equity firms have one purpose and one purpose only.
- munk-a 4y ago
  I guess it might be fairer to then say "I wonder why nobody says out loud that such an acquisition will definitely lead to a decline in service for consumers".
  - Red_Leaves_Flyy 4y ago
    All the people with the platform to say that are on the take.
    - deleted 4y ago
      [deleted]
  - kilna 4y ago
    "decline in service for consumers" -> squeezing the maximum quantity of blood nickels from suffering animals and their owners.
  - deleted 4y ago
    [deleted]
  - arrosenberg 4y ago
    They can’t hear over Robert Bork’s echo.
  - newsclues 4y ago
    Generally people with knowledge of shady stuff have a financial incentive not to speak out.
- MrZongle2 4y ago
  And that is, of course, to put kittens to sleep. (I joke, your point is well taken)
deleted 4y ago
[deleted]
samstave 4y ago
Hedge funds should be 10000000% excluded/precluded and effectively illegal from owning anything but stock in a company/industry at a level whereby they cannot set profit and pricing for ANYTHING. (either invest in the company or industry, but what they do is effectively price-fixing after they get control) Full Stop. --- If you want to buy stock in a thing, a hedge fund should NEVER be able to have a complete controlling share. Why? Because history shows us exactly what happens. Funds, foundations, "private equity" are all money laundering corruption schemes at the cost of others. THe problem is that this modality has replaced the definition of capitalism. There are hedge funds that own over 100,000 houses, hedge funds that buy up every trailer home park they can, hedge funds that, in concert with the realty market, are the reason for high real estate prices. Its a cancer. Insulin Martin. is a great example of the mindset of these folks.
- pc86 4y ago
  They're definitely not money laundering by any real definition of the word. If your goal is to launder money you're probably not doing it by buying stocks and vet clinics.
  - samstave 4y ago
    I always wanted to start a mafioso-esque restaurant front.... The French Money Laundry FML for shot.
legitster 4y ago
A bit of apples and oranges here. The goal of the FTC is not to make big companies smaller, it's to protect the market. They are not supposed to be the ones to determine if whales are natural or not to an ecosystem - so they don't generally go hunting them.
- jessaustin 4y ago
  That's so 1980s. Your appeal to nature has nothing to do with the reality of the last several decades. Mergers among firms in the same market are never good for humans who must use those markets in order to live.
  - legitster 4y ago
    > Mergers among firms in the same market are never good for humans who must use those markets in order to live. I don't think this is a universal truth. Clearly there are situations where consumers prefer national brands or dealing with larger companies. If we don't like it, we can pass laws to impose our morality on the public, but the FTC has their mandate and they are sticking with it until told otherwise.
    - deleted 4y ago
      [deleted]
  - jacobolus 4y ago
    > That's so 1980s. Yep, we’ve had about 50 years now of a Supreme Court shifting further and further to the right, slowly eroding every government check on corporate malfeasance and rent extraction, including antitrust law. The result has been a slow-motion train wreck, and it’s not clear that anything can be done about it for at least a generation.
  - astrange 4y ago
    Dealing with large companies is often better than small businesses or family businesses, which in many industries are incompetent or run by tyrants. Landlords being the classic example.
akira2501 4y ago
There's nothing "market-driven" about the way the Federal Reserve currently works. The Government takes your money and then makes a market you can't participate in, serving entities that seem to primarily thrive off of rent seeking behavior. The entire "Too Big To Fail" period should have made this clear. We are clearly in a government regime that would prefer to control the markets through the discount window than let them be truly driven by their own forces.
dionidium 4y ago
> even housing, that I feel are not well served by a purely-market driven perspective I hate to be the YIMBY broken record, but we don't have anything like a purely market-driven approach to housing. An important aspect of a functioning market is that supply is allowed to increase in order to meet demand. This isn't the case in the United States because of zoning laws. The housing market is more like the market for rare coins or something than it is any kind of actual market.

baggy_trough 4y ago

markovbot 4y ago
ah yes, a more profit driven healthcare sector, exactly what this country needs
- whimsicalism 4y ago
  Shielding people from the actual prices does raise the actual prices typically.
  - Retric 4y ago
    Yet somehow market driven healthcare is almost universally more expensive, it’s like there are some monopolistic effects involved. For example several attempts to privatize the VA failed because of the vast increase in costs.
    - SoftTalker 4y ago
      Yes, when one mega-organization owns most or all of the health care providers in an area (which is very often the case) it's a monopoly and there is no market competition. Where I live for example, from a cost perspective I can't really shop around because there are no individual practices anymore. They (and the clincs and the hospitals) are all owned by the same vast medical congolmerate. It's completely anticompetitive, yet the FTC has not shown any concern AFAIK.
    - dado3212 4y ago
      The two driving forces for higher costs are subsidization of demand (gov't assistance + insurance, all of which have some pass-through effect on raising the cost of services), and artificial restriction of supply (it's hard to create a hospital/vet service/hire non-US doctors). Most market-driven healthcare approaches have been handicapped by one (or usually both) of those factors still being in play.
    - linuxftw 4y ago
      I have experience with the VA system. It's an absolute sham. Privatizing it would absolutely increase costs, because then people would actually been seen, let alone treated, for their conditions.
- arrosenberg 4y ago
  OP isn't exactly wrong. Much of the regulation in housing and healthcare serves to benefit and entrench the incumbents into a non-market situation where the distributors control pricing power.
- Xeoncross 4y ago
  Healthcare was more affordable back when individuals payed for it. The problem was that some could not, so we introduced insurance. At this point no one can afford it anymore without insurance. So our fix for one problem created a new problem.
  - markovbot 4y ago
    if only there was some kind of other option used by all developed countries except the US... too bad there isn't, i guess i'll just die when i cant afford healthcare
    - Xeoncross 4y ago
      What is the other option? Either insurance by private or government bodies or cash is all I've ever seen. Government and private insurance raises prices. Cash excludes poor people.
      - deleted 4y ago
        [deleted]
      - larkost 4y ago
        The other option is to have the government have a larger control, either by government run insurance, or by government run healthcare. There are numerous examples of either in the world that are both more effective by healthcare metrics and lower price than the current U.S. system. To be brutal about this: we in the U.S. demonstrably pay more per person that the rest of the "developed" world, and we get worse outcomes for it, and that is not even counting that we exclude a good portion of our population (which other countries do not). The only place the U.S. excels is at the very top of healthcare, the part that 1% of our population will ever see. We pay the top doctors the top dollar, so they come here, where they charge uber-top-dollar. At one point a lot of this was going to fund new drugs and clinical methods, which quickly filtered down to help everyone. But at this point those filter-downs are few and far between, and it is simply going to those who have the most money, or are the most visible.
xtian 4y ago
Based on what?
alistairSH 4y ago
would You're 100% confident in that assessment? I'm not going to claim less regulation could help control prices. The typical certificate of need process seems like something that could go away without much problem (I find it unlikely anybody would invest in a new hospital or whatever other facility without being relatively confident there's a market). But, regulation on drugs and devices probably should remain.
mywittyname 4y ago
The flaw in this idea is that there's no good way to introduce more competition to the market. The market is only going to continue to optimize for profit. The reason pricing isn't available is because that's negotiated between the provider and the insurance companies. Since most patients are using insurance, hospitals have to negotiate with some of the major insurance providers. Insurance companies do not want hospitals have transparent pricing, since they want people to buy insurance. Insurance companies also want uninsured people to pay a higher price, again, so people buy insurance. People can't choose their insurance providers because it's tied to their employment (in most cases). The market settled on this extremely convoluted system, which makes no sense to outsiders, specifically because it's so profitable. The only way out of it is through regulations that prohibit certain anti-competitive behavior, or for the establishment of competition in the insurance segment, which has no profit motive (and who would start a business with no profit motive?) Most parties kind of like the status quo. Insurance companies collect from employers, rather than individuals, so most people don't see the true cost of insurance. Hospitals get to charge insane amounts for certain procedures, since patients won't pay the entire bill, the insurance company will. And (upper-middle-class) patients are mostly happy, because healthcare feels cheap to them (since, again they never see the true cost they paid).
- tyrfing 4y ago
  > The market settled on this extremely convoluted system, which makes no sense to outsiders, specifically because it's so profitable Which exact parties are extracting excess profits?
  - jessaustin 4y ago
    It's mostly health insurance firms. That's a much bigger sector in USA than it is anywhere else on earth.
    - tyrfing 4y ago
      Low single-digit operating margins aren't typically described as "so profitable" in any other context.
munk-a 4y ago
Never forget that every time an anti-regulation politician gets money under the table for helping to pass terrible market entrenching regulation they win twice: once when they bring home the cash and again when they have yet another example of poor regulation to drive home their ideology. Making broken regulations to entrench large market players is the most patriotic of pastimes in America.

bombcar 4y ago

There's a number of these where there's a desire to make it appear there is competition, but actually all are owned by the same conglomerate. I would be 0% surprised if similar things haven't been done or tried in optometry, dentists, etc.

bobthepanda 4y ago
Starbucks owns a bunch of “independent” shops
riahi 4y ago
See luxottica and their “brands”.
- mywittyname 4y ago
  They even own the insurance company, EyeMed...
  - bombcar 4y ago
    I honestly think at some point this gets to the place of "operating under false pretences" to have so many brands that are actually the same company behind it. Perhaps "brought to you by HOLDING_COMPANY_X" should be required.
3maj 4y ago
For the last 5-10 years one of the most popular strategies for mid-sized PE firms has been the dental clinic roll up.
- monkeybutton 4y ago
  Funny you should say that: https://www.theglobeandmail.com/business/article-private-equity-buy-out-pharmacy-dental-office-veterinary-clinic/ https://www.theglobeandmail.com/business/article-private-equ...
samstave 4y ago

subsubzero 4y ago

agree, it seems like almost every industry really has like maybe 3 at the most players and they are all gigantic and it is extremely non-competitive.

sdfhdhjdw3 4y ago

> One wonders what the Private Equity firm's intention was here. Gee, quite the conundrum.

markovbot 4y ago

> One wonders what the Private Equity firm's intention was here. no, i don't think anyone's wondering that. private equity firms have one purpose and one purpose only.

munk-a 4y ago
I guess it might be fairer to then say "I wonder why nobody says out loud that such an acquisition will definitely lead to a decline in service for consumers".
- Red_Leaves_Flyy 4y ago
  All the people with the platform to say that are on the take.
  - deleted 4y ago
    [deleted]
- kilna 4y ago
  "decline in service for consumers" -> squeezing the maximum quantity of blood nickels from suffering animals and their owners.
- deleted 4y ago
  [deleted]
- arrosenberg 4y ago
  They can’t hear over Robert Bork’s echo.
- newsclues 4y ago
  Generally people with knowledge of shady stuff have a financial incentive not to speak out.
MrZongle2 4y ago
And that is, of course, to put kittens to sleep. (I joke, your point is well taken)

deleted 4y ago

[deleted]

samstave 4y ago

Hedge funds should be 10000000% excluded/precluded and effectively illegal from owning anything but stock in a company/industry at a level whereby they cannot set profit and pricing for ANYTHING. (either invest in the company or industry, but what they do is effectively price-fixing after they get control) Full Stop. --- If you want to buy stock in a thing, a hedge fund should NEVER be able to have a complete controlling share. Why? Because history shows us exactly what happens. Funds, foundations, "private equity" are all money laundering corruption schemes at the cost of others. THe problem is that this modality has replaced the definition of capitalism. There are hedge funds that own over 100,000 houses, hedge funds that buy up every trailer home park they can, hedge funds that, in concert with the realty market, are the reason for high real estate prices. Its a cancer. Insulin Martin. is a great example of the mindset of these folks.

pc86 4y ago
They're definitely not money laundering by any real definition of the word. If your goal is to launder money you're probably not doing it by buying stocks and vet clinics.
- samstave 4y ago
  I always wanted to start a mafioso-esque restaurant front.... The French Money Laundry FML for shot.

legitster 4y ago

A bit of apples and oranges here. The goal of the FTC is not to make big companies smaller, it's to protect the market. They are not supposed to be the ones to determine if whales are natural or not to an ecosystem - so they don't generally go hunting them.

jessaustin 4y ago
That's so 1980s. Your appeal to nature has nothing to do with the reality of the last several decades. Mergers among firms in the same market are never good for humans who must use those markets in order to live.
- legitster 4y ago
  > Mergers among firms in the same market are never good for humans who must use those markets in order to live. I don't think this is a universal truth. Clearly there are situations where consumers prefer national brands or dealing with larger companies. If we don't like it, we can pass laws to impose our morality on the public, but the FTC has their mandate and they are sticking with it until told otherwise.
  - deleted 4y ago
    [deleted]
- jacobolus 4y ago
  > That's so 1980s. Yep, we’ve had about 50 years now of a Supreme Court shifting further and further to the right, slowly eroding every government check on corporate malfeasance and rent extraction, including antitrust law. The result has been a slow-motion train wreck, and it’s not clear that anything can be done about it for at least a generation.
- astrange 4y ago
  Dealing with large companies is often better than small businesses or family businesses, which in many industries are incompetent or run by tyrants. Landlords being the classic example.

akira2501 4y ago

There's nothing "market-driven" about the way the Federal Reserve currently works. The Government takes your money and then makes a market you can't participate in, serving entities that seem to primarily thrive off of rent seeking behavior. The entire "Too Big To Fail" period should have made this clear. We are clearly in a government regime that would prefer to control the markets through the discount window than let them be truly driven by their own forces.

dionidium 4y ago

> even housing, that I feel are not well served by a purely-market driven perspective I hate to be the YIMBY broken record, but we don't have anything like a purely market-driven approach to housing. An important aspect of a functioning market is that supply is allowed to increase in order to meet demand. This isn't the case in the United States because of zoning laws. The housing market is more like the market for rare coins or something than it is any kind of actual market.