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Who employs your doctor? Increasingly, a private equity firm

460 points by yarapavan 3y ago

johndhi 3y ago
[flagged]
zug_zug 3y ago
ZocDoc needs a filter "not owned by private equity" Presumably the effect is -> PE forces doctors to spend less time/thought per patient -> patients receive worse care -> patients change providers Whoever can provide value to patients to forces "market efficiency" and helps patients and the system as a whole.
- junofan 3y ago
  Nah the grift is that insurers are price-takers in a local area (if you want to provide insurance to businesses in Seattle, you need to cover e.g. cardiology in Seattle), so PE buys up all the cardiology practices in Seattle and charges more.
  - gmd63 3y ago
    It's so frustrating that such a basic, non-intelligent move is the go-to by the biggest players that can afford such a strategy. It's completely counter to the presumption that wealthier players are more suited to allocate resources for efficient outcomes.
    - deleted 3y ago
      [deleted]
    - akomtu 3y ago
      Isn't it the basic winning strategy in the monopoly game? Buy up all prisons, then bankrupt your competitors.
verteu 3y ago
Reminds me of "Does Private Equity Investment in Healthcare Benefit Patients?" [1]. > Our estimates show that PE ownership increases the short-term mortality of Medicare patients by 10%, implying 20,150 lives lost due to PE ownership over our twelve-year sample period. This is accompanied by declines in other measures of patient well-being, such as lower mobility, while taxpayer spending per patient episode increases by 11%. We observe operational changes that help to explain these effects, including declines in nursing staff and compliance with standards. [1] https://www.nber.org/system/files/working_papers/w28474/w28474.pdf https://www.nber.org/system/files/working_papers/w28474/w284...
- johndhi 3y ago
  An absolutely wild and illuminating statement
- ackbar03 3y ago
  Capitalism at its best! America! Fk yeah!
  - deleted 3y ago
    [deleted]
- Calavar 3y ago
  Another good article in this space is the New Yorker's report on Hahneman Hospital [1], which was acquired by a private equity firm and dissolved a few years later. [1] https://www.newyorker.com/magazine/2021/06/07/the-death-of-hahnemann-hospital https://www.newyorker.com/magazine/2021/06/07/the-death-of-h...
- starcraft2wol 3y ago
  As they acknowledge, this factor is extremely difficult to isolate from demographics, geography, religion, etc.
  - synetic 3y ago
    But it is not difficult to isolate from common sense. No one should profit from denying someone healthcare. All systems have ration care but it is immoral for someone to profit by denying care. Profit motive does not make for a good healthcare system.
alach11 3y ago
When possible, I prefer people who work for me to have incentives that are aligned with mine. PE-owned medical practices and even many private practices throw that out the window, with financial incentives to do procedures or run tests. I was talking to my wife’s obstetrician about this last week and he also feels strongly about it. He’s paid a flat salary and gets no financial benefit for a c-section vs. an induction vs. a conventional delivery. I’d like to keep it that way.
- starcraft2wol 3y ago
  > gets no financial benefit for a c-section I don't think that's typical anywhere. The incentives they face are less concrete. It may be more inconvenient or uncomfortable for the doctor. If something goes wrong and there is a legal risk, it's difficult to retroactively justify not immediately changing strategies.
  - goodpoint 3y ago
    It's actually typical in some countries, and it's mean to avoid the conflict of interest around prevention VS selling treatments.
  - Calavar 3y ago
    In the US, C-sections reimburse higher than vaginal deliveries across the board. What's changed over the years is who gets the extra money from the C-section. It used to be the physician, but nowadays it is increasingly the hospital. The incentive to do C-sections over vaginal deliveries is still there, but it's transforming into a population level incentive (i.e. is the hospital structuring staffing and workflow in a way that favors C-sections) rather than an individual one (i.e. is a particular physician very trigger happy with C-sections).
- tryptophan 3y ago
  Flat salary is an incentive to do the easiest option or least work. You can’t win with the incentive game. One nasty way that can manifest is to under test because if you don’t find anything you don’t have to do anything.
balderdash 3y ago
I’m the furthest thing from having any knowledge here, but it feels like it should kind of be like how law firms can only have lawyers be owners with the idea that owners need to be aligned with codes of professional conduct/ethical obligations to clients etc
- CamelCaseName 3y ago
  This is true for the veterinary world, probably other professions too. The result is that a veterinarian owns the business on paper, but the PE fund can take over or replace them as needed.
  - darth_avocado 3y ago
    The veterinarian world is doomed. Increasingly PE is taking over entire neighborhoods when it come to vet hospitals. This is led to increased wait times, lower standards of care, higher cost to consumers and higher pet mortality rates. That can very well translate to human healthcare.
    - rcme 3y ago
      But the barriers to starting a new vet are pretty low. If existing vets are inadequate, new ones can start.
      - darth_avocado 3y ago
        Capital is the barrier and the requirement is not low in the areas PE takes over.
        rcme 3y ago
        It seems like a vet would be about as expensive as opening a restaurant, maybe 1-3x as much. That doesn't seem like the most capital intensive thing ever.
recursivedoubts 3y ago
america, unsatisfied with spending vastly more privately on healthcare than the rest of the world, while also spending more publicly on healthcare than the rest of the world, continues to find ways to make healthcare yet more expensive and ruinous for its citizens.
- dazc 3y ago
  Maybe true but, for the rest of the world, you're still the 'go-to' place where medical miracles can happen. Money had something to do with this.
  - Retric 3y ago
    That is more a function of the size of the US medical system than its overall quality. The average American is going to whatever hospital is closest when they have an emergency, but if you’re healthy and wealthy enough to go anywhere then you can pick and choose extreme outliers. Large countries simply have more extreme outliers in both directions. More US citizens seek treatment outside the US than foreign nationals seek treatment inside the US. But, people have specific diseases and sometimes the best treatment is inside the US, though more often it isn’t.
  - chaxor 3y ago
    *In mice - you forgot that part there
  - olddustytrail 3y ago
    Not really. The number of people that's true for is miniscule compared to the number of Americans who engage in medical tourism.
    - weberer 3y ago
      What are the numbers for each one?
      - olddustytrail 3y ago
chrisaiv 3y ago
Archive: https://archive.is/20230714031646/https://www.nytimes.com/2023/07/10/upshot/private-equity-doctors-offices.html https://archive.is/20230714031646/https://www.nytimes.com/20...
tsunamifury 3y ago
PE is essentially buying all needs of a first world human. Medicine, homes, essential services, farmland, in an attempt to extract margin from the last possible places they can. It feels like we’ve re entered the 80s again but worse where now we have 100 billionaires buying up farmland under the guise of it being better that they own it rather than the farmers for… reasons. I think this is essentially late stage capitalism, where there is little left to offer the general population for margin, but much that can be taken away. I’d hazard a guess this is where capitalism turns on us and becomes a regressive force for America as margin stops fueling opportunities and starts fueling general decline for marginal returns. Im not pro socialist and I don’t have a solution — but I think we should recognize this and think hard on how to pull up out of this.
- gruez 3y ago
  >It feels like we’ve re entered the 80s again but worse where now we have 100 billionaires buying up farmland under the guise of it being better that they own it rather than the farmers for… reasons. I don't get it. Are the billionaires buying the land from the farmers at gunpoint? If it's so disastrous for the farmers to sell, why did they sell in the first place?
  - olddustytrail 3y ago
    It's not disastrous for the farmers. It's just bad news for people who require food at any point in their lives. I'm sure it'll be fine as long as your account doesn't get cancelled.
    - tsunamifury 3y ago
      Yea it’s a classic, aggregate individual leverage of simple players by sophisticated players to gain monopoly over the system. Oh it’s fine now farmers can sell, until it’s not.
  - dcow 3y ago
    It’s more a tragedy of the commons. People can act 100% rational at 100 ft. but at the same time be selling their souls collectively at 1000 ft. So the question becomes, “should society work to mitigate the tragedy”? Blackrock buys all the land. What do we do? Doesn't matter if they did it at gunpoint or not, the outcome is not desirable, and we write and enforce the laws.
JoshTko 3y ago
This will not end well.
darth_avocado 3y ago
PE is pretty much ruining everything: https://www.nytimes.com/2023/04/28/opinion/private-equity.html https://www.nytimes.com/2023/04/28/opinion/private-equity.ht...
handwarmers 3y ago
I remember reading about PE's involvement in hospice care and it made me feel sick to my core. https://news.ycombinator.com/item?id=32597326 https://news.ycombinator.com/item?id=32597326 ( When private equity takes over a nursing home) The Portopiccolo Group got sued, but the lawsuit did not go anywhere. https://www.mcknights.com/news/shuttered-nursing-home-avoids-class-action-in-understaffing-lawsuit/ https://www.mcknights.com/news/shuttered-nursing-home-avoids... they are shady to say the least - https://medicareadvocacy.org/private-equity-and-nursing-facilities-a-bad-combination-for-residents/ https://medicareadvocacy.org/private-equity-and-nursing-faci... Also see - https://news.ycombinator.com/item?id=36108182 https://news.ycombinator.com/item?id=36108182 ( Private Equity Is Now Dominating the US Hospice System)
goodpoint 3y ago
>private equity firms own more than half of all specialists in certain U.S. markets "own" specialists? Did the US went all the way back to slavery?
- adgjlsfhk1 3y ago
  no. they just have 5 year contacts that cost a few hundred thousand to break
VancouverMan 3y ago
This is the kind of economic distortion that should be expected when onerous government-imposed regulation of practitioners, medication, and medical devices creates barriers to entry that reduce competition. While such regulation may have been imposed to try to increase safety, quality, and consistency, for example, it also ends up interfering with the incentives of the participants. The lack of real competition, combined with the introduction of significant unnecessary costs and other overhead, encourage and enable the participants to act in ways that may not be beneficial to the patients. The truly unfortunate part is that such regulation often takes options and choices away from the patients, preventing them from accessing alternatives that may help mitigate or avoid the perverse incentives introduced by regulation.
- digdugdirk 3y ago
  Patient options and choices such as "go to the doctor" vs "go into crippling debt while trying to navigate a labyrinthine billing nightmare"? Just as an alternative point of view - you describe these regulations as "government-imposed". Would it not be equally (if not more) likely that these regulations are being created and supported by the industry players themselves? This lack of real competition that you mention sounds like a dream if you have few scruples and a captive market. And telling someone that they'll die unless they pay for your services seems to be about as captive of a market as you can get.
  - userabchn 3y ago
    I think choices was meant to mean things like being able to choose between competing healthcare providers. Created and supported by big industry players that get them turned into law (and thus "government-imposed" - classic regulatory capture. On the Mexican side of the border there are clusters of doctors, dentists, etc., offering lower cost treatment. I imagine that a large part of the decreased cost is due to reduced regulations that make it easier for small, independent providers to offer their services, which in turn results in substantial competition between the many providers to offer the lowest cost for the standard of treatment that patients want.
lordnacho 3y ago
To me it seems like PE has simply discovered a loophole in the system. We want a system where creating value for people is rewarded, but PE has found a way to legally get the rewards without improving society. Normally this is called a scam or a fraud, and there are laws for standard stuff like taking people's money without giving them what you promised. For PE however, they've found a way around it, using the machinery available in the economy. For instance, once you are able to pay out a dividend that covers your cost of purchase, whatever comes next doesn't matter a whole lot from an investment point of view. You may have saddled the target with a huge debt, but that's a heads-I-win-tails-you-lose situation. If the firm does ok, PE actually win more. If it goes bankrupt, oh well. PE firm is still doing fine. The risk is entirely on all the other interested parties: employees and customers. But because we only have one side of the "created value" balance, all we can really see is some PE guys get paid. We don't see the other side, which is pretty hard to untangle. You can make an argument that everyone is better off with society organized this way, but you can't really ignore that many people seem to think they're worse off in this world.
- gmd63 3y ago
  Many arguments for sketchy business moves like ticket scalping or PE / market making is that they "create liquidity" Who is to say that a business should be liquid? Why? What is the value in making it easy to bail on your responsibilities, and why should we encourage people to quickly build a complicated and powerful system and make it easy for them to recuse themselves of that duty?
  - Aunche 3y ago
    I see your point, but otherwise you'd be punishing people for pursuing essential lines of work. A software engineer at a FAANG gets to enjoy liquidity without scrutiny even if they're just facilitating the sale of ads. Why shouldn't a doctor who saves lives get to do the same?
    - gmd63 3y ago
      The value of your actions is not just the immediate work you do. It's the long term effect of the sum of your choices. If you save lives only to put your system that you've built in the hands of a price extracting PE firm, it's arguable you are violating the Hippocratic oath. One of the other commenters mentioned a study that measured a 10% increase in mortality after PE acquisition on average.
rayiner 3y ago
The best things lawyers ever did for themselves is make it illegal for MBAs to own law firms.
- bagacrap 3y ago
  I wish I too could invent a market, mandate that most of the world be my customer, and ban anyone else from profiting from it.
moomoo11 3y ago
I think if we can get more health data access then we can slowly automate out general practice type doctors. Only doctors around will be those who are highly specialized in orthopedics, neurology, etc. For everyone else who needs a Z pack or headache pills, they can just get their care from a AI doctor in their pocket. Why do I need to wait days or weeks to see a general practice doctor? That doesn’t sound fair. Cuts costs heavily. Most people live long with just eating healthy and moving around. I’m sure it will be fine for most people. I personally don’t see a doctor each year. I exercise, eat whole non processed foods (cheaper than whatever packaged crap), and I get my lab work done regularly. The only times I’ve gone in are when I broke something or was heavily bleeding from an injury. I’ll bet if most people put down the Diet Coke in favor of a water, we would save billions of dollars right off the bat.
- hkon 3y ago
  Great that you have good health. It does not however make you a medical expert.
  - moomoo11 3y ago
    Never said I was. Just a victim of never getting an appointment when it’s most necessary. And it’s factually true that Diet Coke isn’t necessary for the health of the body.
chottocharaii 3y ago
This just in: businesses employ people
- verteu 3y ago
  "Private equity" refers to large investment funds that typically buy & restructure businesses to increase profitability. It's not simply a generic term for "a business."
hkon 3y ago
With enough money and a market you can in the end own everything. Which is what these companies have realized.
doodlebugging 3y ago
My former dermatologist practice had several offices in this region staffed by good, trained physicians. It was a pleasant place to visit for the every so often check-up. During the first months of the pandemic I cancelled a regular appointment because our area was hot with COVID. Late last year I finally decided to reschedule that appointment. The whole practice had sold out to PE. It had been renamed with a name that has religious connotations though all the doctors were still there. I'm always suspicious of mixing religion with health care but in this area, north Texas, it isn't unusual to see that type of branding in business names any more. It seems that everyone from your yard person to your doctor wants you to know how patriotic or pious they are so they stick it in their business name or logo. Pretty disgusting to me and I dodge those outfits almost as a rule because they tend to be full of hypocritical assholes who smell the extra income that can flow their way if they just add a little Jesus or veteran reference somewhere. The markets decided a long time ago to use the tools that actually worked and that's why we have trained physicians doing the health care instead of preachers. Anyway, after that appointment I have decided that I will not return and if I ever need to visit another dermatologist I will look for one that is still independent. That old practice has allied with a sketchy compounding pharmacy and they encourage you to use that pharmacy instead of using Walgreens, CVS, etc. probably because there is some level of kick-back in action from referrals. It all seems so broken and filled with greed. It reminds me of the software world where everyone wants you to subscribe and pay perpetually for apps that in most cases offer no long term value and which will inevitably be abandonware when the coder moves on to the next big grift. SaaS is a huge scam infecting the business world. Everyone should offer the option to pay based on actual usage or to buy a perpetual license to use a single version with the option to buy upgrades as they are available, based on the individual's own needs.
jmoak3 3y ago
PE can be replaced with "Some guys". PE bought your hospital? More like, "some guys" bought your hospital. Ask why "some guys" bought it instead of using their money in the market, or why your hospital sold in the first place. As anyone who's company has been purchased by private equity knows, it's probably because your hospital wasn't doing so hot to begin with and "some guys" were willing to gamble that they could turn it around and make some money before it blew up. This will mean turning the screws on the customers and employees and creating a sucky environment. But this is just accelerating what was likely already an inevitable decline. As with any risky investment, there's a solid chance the PE firm will lose money on the gamble. See this recent hacker news submission: https://news.ycombinator.com/item?id=36048464 https://news.ycombinator.com/item?id=36048464, 30% of rural hospitals are closing due to costs growing faster than revenues. Hospitals, in many cases, are not good businesses. Especially in places where doctors, nurses, and other staff can demand a premium based on their local market's dearth of professionals. PE firms in my opinion are part of the slow death of these failing businesses - the last attempts of "some guys" desperate for returns trying to squeeze blood from a rock that everyone else was avoiding.
- bp0017 3y ago
  See, what I fundamentally disagree with is the notion that hospitals should be "good business." Why are "some guys" allowed to try to make a profit here at the expense of patient care? Healthcare (or government) should not be run like a business, and instead be provided as a service using the taxes we already pay for, much like how roads are built. The health of the public is our most vital infrastructure, and public infrastructure requires investment that you really can't make money on without defeating the whole purpose of public service.
  - bagacrap 3y ago
    By this argument why does anything cost money? I need shelter if I am to contribute to society. It should be free! My own healthcare is extremely valuable to me and I should be allowed to spend money on that. Someone else may decide they'd rather have a new pair of sneakers. Who am I to say they're wrong, that they are not permitted to allocate their capital in this way?
jimnotgym 3y ago
Time to get my part subject in. PE firms often control boardrooms without taking seats. Maybe they have the right to appoint a director but don't take it up, but come to board meetings anyway. The legal phrase for someone with control, but not registered as a director is 'shadow director'. Shadow directors are supposed to have the same responsibilities legally as real directors. In practice they get the real directors to risk sanction for insolvency and don't risk themselves. This needs tightening up massively.
j-bos 3y ago
Having recently spent too much time at too many medical offices, I've been able to ask doctors about how thier businesses work. So far only one has said they own their practice, and he's of the opinion most doctors cannot pull off ownership becuase they exit med school bound by debt, and never end up with enough capital to hang their own shingle, much less to buy an existing practice when competing with PE. Of course this is 3rd hand anecdota.
- bagacrap 3y ago
  I don't think most doctors want to be business owners, worrying about employees or bills.
rr808 3y ago
This seems just part of corporatization of nearly all jobs. It isn't just doctors, its restaurants, pharmacies, taxi firms, clothing stores, law firms, home builders. We used to have lots of small independent firms doing this, now people just work for bigger and bigger companies.
tholman 3y ago
I'd noticed some strange changes at our veterinary office, where they'd usually give my dog a full round of shots once a year, suddenly they decided to break it up into multiple different rounds, meaning I'd pay 3 times instead of the one. After a little research I'd found that they'd been bought by a private equity firm, and on further inspection had found a lot (NYC) of practices had changed hands the last few years. There's been some antitrust cases, but the FTC clearly can't block many. The changes are clearly costing everyone more money for no reason, but can anyone really block this? - [1] https://www.ftc.gov/news-events/news/press-releases/2022/06/ftc-acts-protect-pet-owners-private-equity-firms-anticompetitive-acquisition-veterinary-services https://www.ftc.gov/news-events/news/press-releases/2022/06/...
benguild 3y ago
No wonder why the billing is so cranked up
throw9away6 3y ago
Is there a site somewhere that tracks PE shittified firms? I’d pay money to be able to have a list of places to avoid.
projektfu 3y ago
In my space (Veterinary) there has been a ton of this. To people who are used to the way things were, it's been very disruptive. Lots of boomers are retiring and a young vet would only be able to pay a 5x multiple, perhaps, but PE is swooping in at 12-15x. They usually lose a bunch of staff at the transition so they have to hire quickly. It's good for workers in the short term, as wages and salaries are much higher. It's hard for clients, prices are up to compensate for the high wage and to increase/juice returns. Sometimes the purchases flop spectacularly, but they must be winning on average. At the same time, suppliers have consolidated and there's barely any competition. They're also vertically integrating. 10 years ago we were worried there were going to be too many veterinarians. Actually there were, but the wave of age 60+ vets retiring has flipped that around. Now there aren't enough vets or licensed technicians. I am concerned that the future will have another big swing in the downward direction, while multiple PE firms try to find bag holders at the same time. But maybe there industry will just grow and grow. Who knows?
lifeisstillgood 3y ago
The thing about PE that confuses me, in fact it's about all finance. Why is it that a business can be bought by a PE firm, that uses the existing cash flow of the business to fund the loan repayments, but the business itself cannot get a loan to invest in new capital / buy the CEO a yacht etc? There feels like there is a missing market. There is the super safe regulated world of public corporations, where you loan MSFT your cash and they will spend it on marketing O365 or something. And there is the highly specialised one of a kind "selling it for parts" M&A. But where is the middle market where a PE firm makes an offer and the next day the business itself puts up a prospectus and is able to find enough semi-liquid capital to take the self same bet? Why is it so hard to raise funds? or ami missing something
- multicast 3y ago
  > that uses the existing cash flow of the business to fund the loan repayments, but the business itself cannot get a loan to invest in new capital / buy the CEO a yacht etc Loan repayment to banks and other financial institutions is the first and highest priority. During this process the company is constantly turned more efficient and profitable. If it adds value, jobs and capital in form of machines etc. is added, therefore PE firms do not only reduce employment. The goal is also to sell irrelevant jets / yachts and eliminate other expensive non-business related expenses from which often a few benefit. The goal is not to buy new yachts. In fact a PE firm is committed by contract and by incentives through own investments, to not use the company to fund lavish lifestyles. After on average 5 years the company is sold for a multiple. > But where is the middle market where a PE firm makes an offer and the next day the business itself puts up a prospectus and is able to find enough semi-liquid capital to take the self same bet? Why is it so hard to raise funds? I think I don't really get your point here. There is no infrastructure which provides businesses this option, because it does not make sense. Private businesses are often sold through investment banks, and if the desire to sell comes from the owner, then there is often a form of auction involved. Companies with a solid business are getting a very good price this way. But raising funds for an existing business and selling a business are two completely different things. You don't accept a PE firms invitation to a call, and then turn the other way to get funding and keep ownership.
- 3y ago
rqtwteye 3y ago
I still remember when my dentist sold his practice to a larger group. Suddenly they found things that needed to be fixed immediately during every teeth cleaning. After two years I went I another dentist and suddenly my teeth were healthy again. I think private equity will break capitalism. Instead of people being interested in something and also making profits, with PR you have people that only care about profit and have no passion for the product.
multicast 3y ago
It is a free market, about 30% of all hospitals and doctor offices in the US are a for profit private corporation, thus they can be acquired as any other business by anyone. Like with pharma, most people have the very big misconception that just because its about health, that hospitals are excluded from free market and capitalistic principles. When someone offers hospital services or starts developing a new drug, he can charge whatever price he wants, and he will do it as long as profits are maximized and don't start to plunge due to too large price hikes (+ conflicts with insurance companies etc.). Hospitals in countries like Switzerland are known for the best medical treatment because they are almost 100% for profit - private / investor owned. Running a hospital is a business as any other + 95% of the US population has a healthcare insurance anyway. At topics like healthcare, most people are simply too much Hollywood educated and debate with irrelevant individual experiences.
- verteu 3y ago
  The Swiss system isn't quite lassiez-faire capitalist: > "The Swiss government... does keep down overall spending by regulating drug prices and fees for lab tests and medical devices > Swiss insurance companies [must] offer the mandatory basic plan on a not-for-profit basis, although they are permitted to earn a profit on supplemental plans. It does seem like a promising approach that's (largely) market-driven. [1] https://www.nytimes.com/2009/10/01/health/policy/01swiss.html https://www.nytimes.com/2009/10/01/health/policy/01swiss.htm...
mmanfrin 3y ago
Monarchy begets Democracy begets Oligarchy.
ubermonkey 3y ago
PE is a toxic destroying cancer on our economy, and should be stamped out as vigorously as possible.
Havoc 3y ago
Must admit I find hn comments on PE anything quite strange. VC good, PE evil when in many cases it’s just different stage of life of the same company & what the means for funding sources
- thisgoesnowhere 3y ago
  I think the general idea is that VC and PE are parasitic but at least VC helps to build. PE often destroys as this article shows.
  - ramraj07 3y ago
    So VC is Bhrama and PE is Shiva. One monetized building and another the deconstruction. If you're mad at just the destroying entity you're missing the point. The rot of PE stems from the same incentives of VC from where I sit and see.
    - thisgoesnowhere 3y ago
      PE conceptually is fine and if it worked the way you describe then nobody (respectable) would be complaining. But in practice you see it turn healthy or struggling but fixable companies into a shell to hold onto debt. Its a twisted way of using the financial structure to siphon money without creating value (I would argue it destroys value instead). See the story of Toys R Us as an example.
  - bagacrap 3y ago
    Helps to build what exactly? Airbnb, which makes housing less affordable? When has VC created something that approximates a public good, such as a hospital?
    - thisgoesnowhere 3y ago
      Stripe is great and is just a massive boost to the entire industry. Shopify is also great, Apple makes great products, Google search is fantastic. I could go on.
rtaylorgarlock 3y ago
https://archive.li/JfCzm https://archive.li/JfCzm
jgoodknight 3y ago
The graph really makes it seem like the small practices are getting screwed on reimbursement rates, but once PE takes over, they are in a better negotiating position to get higher reimbursement rates from insurance companies.
pcvarmint 3y ago
Answer: I do. I use Direct Primary Care. I do not use doctors who are beholden to corporate bosses, insurance companies or shareholders. COVID-19 has accelerated the parallel economy of Direct Primary (and Specialist) Care. It was a fork in the road, a bifurcation point, and many have decided which way they are going. There are people who value medical freedom and the doctor-patient relationship, and there are some who value collective concerns "for the greater good" at the expense of individual liberty.

460 points by yarapavan 3y ago

[flagged]

ZocDoc needs a filter "not owned by private equity" Presumably the effect is -> PE forces doctors to spend less time/thought per patient -> patients receive worse care -> patients change providers Whoever can provide value to patients to forces "market efficiency" and helps patients and the system as a whole.

junofan 3y ago
Nah the grift is that insurers are price-takers in a local area (if you want to provide insurance to businesses in Seattle, you need to cover e.g. cardiology in Seattle), so PE buys up all the cardiology practices in Seattle and charges more.
- gmd63 3y ago
  It's so frustrating that such a basic, non-intelligent move is the go-to by the biggest players that can afford such a strategy. It's completely counter to the presumption that wealthier players are more suited to allocate resources for efficient outcomes.
  - deleted 3y ago
    [deleted]
  - akomtu 3y ago
    Isn't it the basic winning strategy in the monopoly game? Buy up all prisons, then bankrupt your competitors.

verteu 3y ago

Reminds me of "Does Private Equity Investment in Healthcare Benefit Patients?" [1]. > Our estimates show that PE ownership increases the short-term mortality of Medicare patients by 10%, implying 20,150 lives lost due to PE ownership over our twelve-year sample period. This is accompanied by declines in other measures of patient well-being, such as lower mobility, while taxpayer spending per patient episode increases by 11%. We observe operational changes that help to explain these effects, including declines in nursing staff and compliance with standards. [1] https://www.nber.org/system/files/working_papers/w28474/w28474.pdf https://www.nber.org/system/files/working_papers/w28474/w284...

johndhi 3y ago
An absolutely wild and illuminating statement
ackbar03 3y ago
Capitalism at its best! America! Fk yeah!
- deleted 3y ago
  [deleted]
Calavar 3y ago
Another good article in this space is the New Yorker's report on Hahneman Hospital [1], which was acquired by a private equity firm and dissolved a few years later. [1] https://www.newyorker.com/magazine/2021/06/07/the-death-of-hahnemann-hospital https://www.newyorker.com/magazine/2021/06/07/the-death-of-h...
starcraft2wol 3y ago
As they acknowledge, this factor is extremely difficult to isolate from demographics, geography, religion, etc.
- synetic 3y ago
  But it is not difficult to isolate from common sense. No one should profit from denying someone healthcare. All systems have ration care but it is immoral for someone to profit by denying care. Profit motive does not make for a good healthcare system.

alach11 3y ago

When possible, I prefer people who work for me to have incentives that are aligned with mine. PE-owned medical practices and even many private practices throw that out the window, with financial incentives to do procedures or run tests. I was talking to my wife’s obstetrician about this last week and he also feels strongly about it. He’s paid a flat salary and gets no financial benefit for a c-section vs. an induction vs. a conventional delivery. I’d like to keep it that way.

starcraft2wol 3y ago
> gets no financial benefit for a c-section I don't think that's typical anywhere. The incentives they face are less concrete. It may be more inconvenient or uncomfortable for the doctor. If something goes wrong and there is a legal risk, it's difficult to retroactively justify not immediately changing strategies.
- goodpoint 3y ago
  It's actually typical in some countries, and it's mean to avoid the conflict of interest around prevention VS selling treatments.
- Calavar 3y ago
  In the US, C-sections reimburse higher than vaginal deliveries across the board. What's changed over the years is who gets the extra money from the C-section. It used to be the physician, but nowadays it is increasingly the hospital. The incentive to do C-sections over vaginal deliveries is still there, but it's transforming into a population level incentive (i.e. is the hospital structuring staffing and workflow in a way that favors C-sections) rather than an individual one (i.e. is a particular physician very trigger happy with C-sections).
tryptophan 3y ago
Flat salary is an incentive to do the easiest option or least work. You can’t win with the incentive game. One nasty way that can manifest is to under test because if you don’t find anything you don’t have to do anything.

balderdash 3y ago

I’m the furthest thing from having any knowledge here, but it feels like it should kind of be like how law firms can only have lawyers be owners with the idea that owners need to be aligned with codes of professional conduct/ethical obligations to clients etc

CamelCaseName 3y ago
This is true for the veterinary world, probably other professions too. The result is that a veterinarian owns the business on paper, but the PE fund can take over or replace them as needed.
- darth_avocado 3y ago
  The veterinarian world is doomed. Increasingly PE is taking over entire neighborhoods when it come to vet hospitals. This is led to increased wait times, lower standards of care, higher cost to consumers and higher pet mortality rates. That can very well translate to human healthcare.
  - rcme 3y ago
    But the barriers to starting a new vet are pretty low. If existing vets are inadequate, new ones can start.
    - darth_avocado 3y ago
      Capital is the barrier and the requirement is not low in the areas PE takes over.
      - rcme 3y ago
        It seems like a vet would be about as expensive as opening a restaurant, maybe 1-3x as much. That doesn't seem like the most capital intensive thing ever.

recursivedoubts 3y ago

america, unsatisfied with spending vastly more privately on healthcare than the rest of the world, while also spending more publicly on healthcare than the rest of the world, continues to find ways to make healthcare yet more expensive and ruinous for its citizens.

dazc 3y ago
Maybe true but, for the rest of the world, you're still the 'go-to' place where medical miracles can happen. Money had something to do with this.
- Retric 3y ago
  That is more a function of the size of the US medical system than its overall quality. The average American is going to whatever hospital is closest when they have an emergency, but if you’re healthy and wealthy enough to go anywhere then you can pick and choose extreme outliers. Large countries simply have more extreme outliers in both directions. More US citizens seek treatment outside the US than foreign nationals seek treatment inside the US. But, people have specific diseases and sometimes the best treatment is inside the US, though more often it isn’t.
- chaxor 3y ago
  *In mice - you forgot that part there
- olddustytrail 3y ago
  Not really. The number of people that's true for is miniscule compared to the number of Americans who engage in medical tourism.
  - weberer 3y ago
    What are the numbers for each one?
    - olddustytrail 3y ago

chrisaiv 3y ago

Archive: https://archive.is/20230714031646/https://www.nytimes.com/2023/07/10/upshot/private-equity-doctors-offices.html https://archive.is/20230714031646/https://www.nytimes.com/20...

tsunamifury 3y ago

PE is essentially buying all needs of a first world human. Medicine, homes, essential services, farmland, in an attempt to extract margin from the last possible places they can. It feels like we’ve re entered the 80s again but worse where now we have 100 billionaires buying up farmland under the guise of it being better that they own it rather than the farmers for… reasons. I think this is essentially late stage capitalism, where there is little left to offer the general population for margin, but much that can be taken away. I’d hazard a guess this is where capitalism turns on us and becomes a regressive force for America as margin stops fueling opportunities and starts fueling general decline for marginal returns. Im not pro socialist and I don’t have a solution — but I think we should recognize this and think hard on how to pull up out of this.

gruez 3y ago
>It feels like we’ve re entered the 80s again but worse where now we have 100 billionaires buying up farmland under the guise of it being better that they own it rather than the farmers for… reasons. I don't get it. Are the billionaires buying the land from the farmers at gunpoint? If it's so disastrous for the farmers to sell, why did they sell in the first place?
- olddustytrail 3y ago
  It's not disastrous for the farmers. It's just bad news for people who require food at any point in their lives. I'm sure it'll be fine as long as your account doesn't get cancelled.
  - tsunamifury 3y ago
    Yea it’s a classic, aggregate individual leverage of simple players by sophisticated players to gain monopoly over the system. Oh it’s fine now farmers can sell, until it’s not.
- dcow 3y ago
  It’s more a tragedy of the commons. People can act 100% rational at 100 ft. but at the same time be selling their souls collectively at 1000 ft. So the question becomes, “should society work to mitigate the tragedy”? Blackrock buys all the land. What do we do? Doesn't matter if they did it at gunpoint or not, the outcome is not desirable, and we write and enforce the laws.

JoshTko 3y ago

This will not end well.

darth_avocado 3y ago

PE is pretty much ruining everything: https://www.nytimes.com/2023/04/28/opinion/private-equity.html https://www.nytimes.com/2023/04/28/opinion/private-equity.ht...

handwarmers 3y ago

I remember reading about PE's involvement in hospice care and it made me feel sick to my core. https://news.ycombinator.com/item?id=32597326 https://news.ycombinator.com/item?id=32597326 ( When private equity takes over a nursing home) The Portopiccolo Group got sued, but the lawsuit did not go anywhere. https://www.mcknights.com/news/shuttered-nursing-home-avoids-class-action-in-understaffing-lawsuit/ https://www.mcknights.com/news/shuttered-nursing-home-avoids... they are shady to say the least - https://medicareadvocacy.org/private-equity-and-nursing-facilities-a-bad-combination-for-residents/ https://medicareadvocacy.org/private-equity-and-nursing-faci... Also see - https://news.ycombinator.com/item?id=36108182 https://news.ycombinator.com/item?id=36108182 ( Private Equity Is Now Dominating the US Hospice System)

goodpoint 3y ago

>private equity firms own more than half of all specialists in certain U.S. markets "own" specialists? Did the US went all the way back to slavery?

adgjlsfhk1 3y ago
no. they just have 5 year contacts that cost a few hundred thousand to break

VancouverMan 3y ago

This is the kind of economic distortion that should be expected when onerous government-imposed regulation of practitioners, medication, and medical devices creates barriers to entry that reduce competition. While such regulation may have been imposed to try to increase safety, quality, and consistency, for example, it also ends up interfering with the incentives of the participants. The lack of real competition, combined with the introduction of significant unnecessary costs and other overhead, encourage and enable the participants to act in ways that may not be beneficial to the patients. The truly unfortunate part is that such regulation often takes options and choices away from the patients, preventing them from accessing alternatives that may help mitigate or avoid the perverse incentives introduced by regulation.

digdugdirk 3y ago
Patient options and choices such as "go to the doctor" vs "go into crippling debt while trying to navigate a labyrinthine billing nightmare"? Just as an alternative point of view - you describe these regulations as "government-imposed". Would it not be equally (if not more) likely that these regulations are being created and supported by the industry players themselves? This lack of real competition that you mention sounds like a dream if you have few scruples and a captive market. And telling someone that they'll die unless they pay for your services seems to be about as captive of a market as you can get.
- userabchn 3y ago
  I think choices was meant to mean things like being able to choose between competing healthcare providers. Created and supported by big industry players that get them turned into law (and thus "government-imposed" - classic regulatory capture. On the Mexican side of the border there are clusters of doctors, dentists, etc., offering lower cost treatment. I imagine that a large part of the decreased cost is due to reduced regulations that make it easier for small, independent providers to offer their services, which in turn results in substantial competition between the many providers to offer the lowest cost for the standard of treatment that patients want.

lordnacho 3y ago

To me it seems like PE has simply discovered a loophole in the system. We want a system where creating value for people is rewarded, but PE has found a way to legally get the rewards without improving society. Normally this is called a scam or a fraud, and there are laws for standard stuff like taking people's money without giving them what you promised. For PE however, they've found a way around it, using the machinery available in the economy. For instance, once you are able to pay out a dividend that covers your cost of purchase, whatever comes next doesn't matter a whole lot from an investment point of view. You may have saddled the target with a huge debt, but that's a heads-I-win-tails-you-lose situation. If the firm does ok, PE actually win more. If it goes bankrupt, oh well. PE firm is still doing fine. The risk is entirely on all the other interested parties: employees and customers. But because we only have one side of the "created value" balance, all we can really see is some PE guys get paid. We don't see the other side, which is pretty hard to untangle. You can make an argument that everyone is better off with society organized this way, but you can't really ignore that many people seem to think they're worse off in this world.

gmd63 3y ago
Many arguments for sketchy business moves like ticket scalping or PE / market making is that they "create liquidity" Who is to say that a business should be liquid? Why? What is the value in making it easy to bail on your responsibilities, and why should we encourage people to quickly build a complicated and powerful system and make it easy for them to recuse themselves of that duty?
- Aunche 3y ago
  I see your point, but otherwise you'd be punishing people for pursuing essential lines of work. A software engineer at a FAANG gets to enjoy liquidity without scrutiny even if they're just facilitating the sale of ads. Why shouldn't a doctor who saves lives get to do the same?
  - gmd63 3y ago
    The value of your actions is not just the immediate work you do. It's the long term effect of the sum of your choices. If you save lives only to put your system that you've built in the hands of a price extracting PE firm, it's arguable you are violating the Hippocratic oath. One of the other commenters mentioned a study that measured a 10% increase in mortality after PE acquisition on average.

rayiner 3y ago

The best things lawyers ever did for themselves is make it illegal for MBAs to own law firms.

bagacrap 3y ago
I wish I too could invent a market, mandate that most of the world be my customer, and ban anyone else from profiting from it.

moomoo11 3y ago

I think if we can get more health data access then we can slowly automate out general practice type doctors. Only doctors around will be those who are highly specialized in orthopedics, neurology, etc. For everyone else who needs a Z pack or headache pills, they can just get their care from a AI doctor in their pocket. Why do I need to wait days or weeks to see a general practice doctor? That doesn’t sound fair. Cuts costs heavily. Most people live long with just eating healthy and moving around. I’m sure it will be fine for most people. I personally don’t see a doctor each year. I exercise, eat whole non processed foods (cheaper than whatever packaged crap), and I get my lab work done regularly. The only times I’ve gone in are when I broke something or was heavily bleeding from an injury. I’ll bet if most people put down the Diet Coke in favor of a water, we would save billions of dollars right off the bat.

hkon 3y ago
Great that you have good health. It does not however make you a medical expert.
- moomoo11 3y ago
  Never said I was. Just a victim of never getting an appointment when it’s most necessary. And it’s factually true that Diet Coke isn’t necessary for the health of the body.

chottocharaii 3y ago

This just in: businesses employ people

verteu 3y ago
"Private equity" refers to large investment funds that typically buy & restructure businesses to increase profitability. It's not simply a generic term for "a business."

hkon 3y ago

With enough money and a market you can in the end own everything. Which is what these companies have realized.

doodlebugging 3y ago

My former dermatologist practice had several offices in this region staffed by good, trained physicians. It was a pleasant place to visit for the every so often check-up. During the first months of the pandemic I cancelled a regular appointment because our area was hot with COVID. Late last year I finally decided to reschedule that appointment. The whole practice had sold out to PE. It had been renamed with a name that has religious connotations though all the doctors were still there. I'm always suspicious of mixing religion with health care but in this area, north Texas, it isn't unusual to see that type of branding in business names any more. It seems that everyone from your yard person to your doctor wants you to know how patriotic or pious they are so they stick it in their business name or logo. Pretty disgusting to me and I dodge those outfits almost as a rule because they tend to be full of hypocritical assholes who smell the extra income that can flow their way if they just add a little Jesus or veteran reference somewhere. The markets decided a long time ago to use the tools that actually worked and that's why we have trained physicians doing the health care instead of preachers. Anyway, after that appointment I have decided that I will not return and if I ever need to visit another dermatologist I will look for one that is still independent. That old practice has allied with a sketchy compounding pharmacy and they encourage you to use that pharmacy instead of using Walgreens, CVS, etc. probably because there is some level of kick-back in action from referrals. It all seems so broken and filled with greed. It reminds me of the software world where everyone wants you to subscribe and pay perpetually for apps that in most cases offer no long term value and which will inevitably be abandonware when the coder moves on to the next big grift. SaaS is a huge scam infecting the business world. Everyone should offer the option to pay based on actual usage or to buy a perpetual license to use a single version with the option to buy upgrades as they are available, based on the individual's own needs.

jmoak3 3y ago

PE can be replaced with "Some guys". PE bought your hospital? More like, "some guys" bought your hospital. Ask why "some guys" bought it instead of using their money in the market, or why your hospital sold in the first place. As anyone who's company has been purchased by private equity knows, it's probably because your hospital wasn't doing so hot to begin with and "some guys" were willing to gamble that they could turn it around and make some money before it blew up. This will mean turning the screws on the customers and employees and creating a sucky environment. But this is just accelerating what was likely already an inevitable decline. As with any risky investment, there's a solid chance the PE firm will lose money on the gamble. See this recent hacker news submission: https://news.ycombinator.com/item?id=36048464 https://news.ycombinator.com/item?id=36048464, 30% of rural hospitals are closing due to costs growing faster than revenues. Hospitals, in many cases, are not good businesses. Especially in places where doctors, nurses, and other staff can demand a premium based on their local market's dearth of professionals. PE firms in my opinion are part of the slow death of these failing businesses - the last attempts of "some guys" desperate for returns trying to squeeze blood from a rock that everyone else was avoiding.

bp0017 3y ago
See, what I fundamentally disagree with is the notion that hospitals should be "good business." Why are "some guys" allowed to try to make a profit here at the expense of patient care? Healthcare (or government) should not be run like a business, and instead be provided as a service using the taxes we already pay for, much like how roads are built. The health of the public is our most vital infrastructure, and public infrastructure requires investment that you really can't make money on without defeating the whole purpose of public service.
- bagacrap 3y ago
  By this argument why does anything cost money? I need shelter if I am to contribute to society. It should be free! My own healthcare is extremely valuable to me and I should be allowed to spend money on that. Someone else may decide they'd rather have a new pair of sneakers. Who am I to say they're wrong, that they are not permitted to allocate their capital in this way?

jimnotgym 3y ago

Time to get my part subject in. PE firms often control boardrooms without taking seats. Maybe they have the right to appoint a director but don't take it up, but come to board meetings anyway. The legal phrase for someone with control, but not registered as a director is 'shadow director'. Shadow directors are supposed to have the same responsibilities legally as real directors. In practice they get the real directors to risk sanction for insolvency and don't risk themselves. This needs tightening up massively.

j-bos 3y ago

Having recently spent too much time at too many medical offices, I've been able to ask doctors about how thier businesses work. So far only one has said they own their practice, and he's of the opinion most doctors cannot pull off ownership becuase they exit med school bound by debt, and never end up with enough capital to hang their own shingle, much less to buy an existing practice when competing with PE. Of course this is 3rd hand anecdota.

bagacrap 3y ago
I don't think most doctors want to be business owners, worrying about employees or bills.

rr808 3y ago

This seems just part of corporatization of nearly all jobs. It isn't just doctors, its restaurants, pharmacies, taxi firms, clothing stores, law firms, home builders. We used to have lots of small independent firms doing this, now people just work for bigger and bigger companies.

tholman 3y ago

I'd noticed some strange changes at our veterinary office, where they'd usually give my dog a full round of shots once a year, suddenly they decided to break it up into multiple different rounds, meaning I'd pay 3 times instead of the one. After a little research I'd found that they'd been bought by a private equity firm, and on further inspection had found a lot (NYC) of practices had changed hands the last few years. There's been some antitrust cases, but the FTC clearly can't block many. The changes are clearly costing everyone more money for no reason, but can anyone really block this? - [1] https://www.ftc.gov/news-events/news/press-releases/2022/06/ftc-acts-protect-pet-owners-private-equity-firms-anticompetitive-acquisition-veterinary-services https://www.ftc.gov/news-events/news/press-releases/2022/06/...

benguild 3y ago

No wonder why the billing is so cranked up

throw9away6 3y ago

Is there a site somewhere that tracks PE shittified firms? I’d pay money to be able to have a list of places to avoid.

projektfu 3y ago

In my space (Veterinary) there has been a ton of this. To people who are used to the way things were, it's been very disruptive. Lots of boomers are retiring and a young vet would only be able to pay a 5x multiple, perhaps, but PE is swooping in at 12-15x. They usually lose a bunch of staff at the transition so they have to hire quickly. It's good for workers in the short term, as wages and salaries are much higher. It's hard for clients, prices are up to compensate for the high wage and to increase/juice returns. Sometimes the purchases flop spectacularly, but they must be winning on average. At the same time, suppliers have consolidated and there's barely any competition. They're also vertically integrating. 10 years ago we were worried there were going to be too many veterinarians. Actually there were, but the wave of age 60+ vets retiring has flipped that around. Now there aren't enough vets or licensed technicians. I am concerned that the future will have another big swing in the downward direction, while multiple PE firms try to find bag holders at the same time. But maybe there industry will just grow and grow. Who knows?

lifeisstillgood 3y ago

The thing about PE that confuses me, in fact it's about all finance. Why is it that a business can be bought by a PE firm, that uses the existing cash flow of the business to fund the loan repayments, but the business itself cannot get a loan to invest in new capital / buy the CEO a yacht etc? There feels like there is a missing market. There is the super safe regulated world of public corporations, where you loan MSFT your cash and they will spend it on marketing O365 or something. And there is the highly specialised one of a kind "selling it for parts" M&A. But where is the middle market where a PE firm makes an offer and the next day the business itself puts up a prospectus and is able to find enough semi-liquid capital to take the self same bet? Why is it so hard to raise funds? or ami missing something

multicast 3y ago
> that uses the existing cash flow of the business to fund the loan repayments, but the business itself cannot get a loan to invest in new capital / buy the CEO a yacht etc Loan repayment to banks and other financial institutions is the first and highest priority. During this process the company is constantly turned more efficient and profitable. If it adds value, jobs and capital in form of machines etc. is added, therefore PE firms do not only reduce employment. The goal is also to sell irrelevant jets / yachts and eliminate other expensive non-business related expenses from which often a few benefit. The goal is not to buy new yachts. In fact a PE firm is committed by contract and by incentives through own investments, to not use the company to fund lavish lifestyles. After on average 5 years the company is sold for a multiple. > But where is the middle market where a PE firm makes an offer and the next day the business itself puts up a prospectus and is able to find enough semi-liquid capital to take the self same bet? Why is it so hard to raise funds? I think I don't really get your point here. There is no infrastructure which provides businesses this option, because it does not make sense. Private businesses are often sold through investment banks, and if the desire to sell comes from the owner, then there is often a form of auction involved. Companies with a solid business are getting a very good price this way. But raising funds for an existing business and selling a business are two completely different things. You don't accept a PE firms invitation to a call, and then turn the other way to get funding and keep ownership.
3y ago

rqtwteye 3y ago

I still remember when my dentist sold his practice to a larger group. Suddenly they found things that needed to be fixed immediately during every teeth cleaning. After two years I went I another dentist and suddenly my teeth were healthy again. I think private equity will break capitalism. Instead of people being interested in something and also making profits, with PR you have people that only care about profit and have no passion for the product.

multicast 3y ago

It is a free market, about 30% of all hospitals and doctor offices in the US are a for profit private corporation, thus they can be acquired as any other business by anyone. Like with pharma, most people have the very big misconception that just because its about health, that hospitals are excluded from free market and capitalistic principles. When someone offers hospital services or starts developing a new drug, he can charge whatever price he wants, and he will do it as long as profits are maximized and don't start to plunge due to too large price hikes (+ conflicts with insurance companies etc.). Hospitals in countries like Switzerland are known for the best medical treatment because they are almost 100% for profit - private / investor owned. Running a hospital is a business as any other + 95% of the US population has a healthcare insurance anyway. At topics like healthcare, most people are simply too much Hollywood educated and debate with irrelevant individual experiences.

verteu 3y ago
The Swiss system isn't quite lassiez-faire capitalist: > "The Swiss government... does keep down overall spending by regulating drug prices and fees for lab tests and medical devices > Swiss insurance companies [must] offer the mandatory basic plan on a not-for-profit basis, although they are permitted to earn a profit on supplemental plans. It does seem like a promising approach that's (largely) market-driven. [1] https://www.nytimes.com/2009/10/01/health/policy/01swiss.html https://www.nytimes.com/2009/10/01/health/policy/01swiss.htm...

mmanfrin 3y ago

Monarchy begets Democracy begets Oligarchy.

ubermonkey 3y ago

PE is a toxic destroying cancer on our economy, and should be stamped out as vigorously as possible.

Havoc 3y ago

Must admit I find hn comments on PE anything quite strange. VC good, PE evil when in many cases it’s just different stage of life of the same company & what the means for funding sources

thisgoesnowhere 3y ago
I think the general idea is that VC and PE are parasitic but at least VC helps to build. PE often destroys as this article shows.
- ramraj07 3y ago
  So VC is Bhrama and PE is Shiva. One monetized building and another the deconstruction. If you're mad at just the destroying entity you're missing the point. The rot of PE stems from the same incentives of VC from where I sit and see.
  - thisgoesnowhere 3y ago
    PE conceptually is fine and if it worked the way you describe then nobody (respectable) would be complaining. But in practice you see it turn healthy or struggling but fixable companies into a shell to hold onto debt. Its a twisted way of using the financial structure to siphon money without creating value (I would argue it destroys value instead). See the story of Toys R Us as an example.
- bagacrap 3y ago
  Helps to build what exactly? Airbnb, which makes housing less affordable? When has VC created something that approximates a public good, such as a hospital?
  - thisgoesnowhere 3y ago
    Stripe is great and is just a massive boost to the entire industry. Shopify is also great, Apple makes great products, Google search is fantastic. I could go on.

rtaylorgarlock 3y ago

https://archive.li/JfCzm https://archive.li/JfCzm

jgoodknight 3y ago

The graph really makes it seem like the small practices are getting screwed on reimbursement rates, but once PE takes over, they are in a better negotiating position to get higher reimbursement rates from insurance companies.

pcvarmint 3y ago

Answer: I do. I use Direct Primary Care. I do not use doctors who are beholden to corporate bosses, insurance companies or shareholders. COVID-19 has accelerated the parallel economy of Direct Primary (and Specialist) Care. It was a fork in the road, a bifurcation point, and many have decided which way they are going. There are people who value medical freedom and the doctor-patient relationship, and there are some who value collective concerns "for the greater good" at the expense of individual liberty.