3 ms·

Medicine is extremely capex intensive and only become more so. Sucking private capital out of healthcare is going to make it vastly worse for everyone; higher p

by frisco 13d ago

Medicine is extremely capex intensive and only become more so. Sucking private capital out of healthcare is going to make it vastly worse for everyone; higher prices and less innovation. I think we can criticize the often ruthlessness of PE while realizing that limiting medicine's ability to invest would be a huge self-own and only force further centralization into the biggest non-profit centers. Medicine is already held back enough by the lack of ability to use debt to finance its sales, unlike almost every other industry; you can repossess a car but you can't repo an implant or administered drug, forcing everything to be paid for in cash upfront. Medicine needs as much access to capital as it can get.

BugsJustFindMe 13d ago
> Sucking private capital out of healthcare is going to make it vastly worse for everyone; higher prices and less innovation. Injecting PE into healthcare is what made it vastly worse for everyone in the first place. You can't have it both ways.
- frisco 13d ago
  I'm sorry, compared to what? We're not talking about a routine doctor's office for healthy people. Advanced care is extremely technologically intensive and your local surgeon is not personally buying the $20M in infrastructure required for many modern advanced treatments. Venture capital has been essential for progress in medicine, and many advanced therapies are going to be increasingly delivered vertically integrated for the widest accessibility and best outcomes.
  - bonsai_spool 13d ago
    > Venture capital has been essential for progress in medicine VC's can still fund companies that are making expensive new products. Banks (and PE...) can still underwrite loans for these things. We have many solutions for capex-intensive businesses and have had these for over four hundred years. LBO-type PE is not even fifty years old yet
    - frisco 13d ago
      agreed but that is not what they are talking about banning -- "PE" is expansive and includes all those other things. If they narrowed this proposal to just what people are thinking of as "PE" here rolling up clinics and gaining local pricing power that would be different and I'd agree with you
      - bonsai_spool 13d ago
        > agreed but that is not what they are talking about banning I think you misunderstand me. I think what is proposed to be banned (employers of doctors who are PE firms) should not exist. It is strictly not necessary, and there's an excellent example of the consequences playing out across Massachusetts right now (which explains the bill's introduction by Warren).. I'm not sure how we decided only lawyers can run law firms but that anybody can operate a hospital...
drknownuffin 13d ago
I have no words for how completely toxic the surge of PE in healthcare has been. It's driven the degradation of care everywhere I've been. Healthcare chains have no issues with investment (see any annual reporting document to see how much money is sitting in various investments, mostly RE); smaller clinics being eaten up by PE chains is not an answer to centralization, it's just another mechanism of it.
- frisco 13d ago
  "Private equity" also includes venture capital here. It means all private direct investment. The thing you are imagining is one small corner of what private equity actually is.
vjvjvjvjghv 13d ago
" less innovation" "Innovation" as in marketing expenses and stock buybacks?
BLKNSLVR 13d ago
It feels to me as if the US is a useful example for the outcomes of a focus on capitalist ideals does for medical services in a country. Apologies if an AI summary is offensive to some, but here we go: > The US is a world leader in advanced and specialist medicine, but its overall system for providing affordable, accessible, equitable medical care to its citizens ranks poorly—last among the 10 comparable high-income countries in the strongest recent comparison. Both sources are the same site: https://www.commonwealthfund.org/sites/default/files/2024-09/PDF_Blumenthal_mirror_mirror_2024_Exhibits.pdf https://www.commonwealthfund.org/sites/default/files/2024-09... https://www.commonwealthfund.org/publications/fund-reports/2024/sep/mirror-mirror-2024 https://www.commonwealthfund.org/publications/fund-reports/2...

by frisco 13d ago

BugsJustFindMe 13d ago

> Sucking private capital out of healthcare is going to make it vastly worse for everyone; higher prices and less innovation. Injecting PE into healthcare is what made it vastly worse for everyone in the first place. You can't have it both ways.

frisco 13d ago
I'm sorry, compared to what? We're not talking about a routine doctor's office for healthy people. Advanced care is extremely technologically intensive and your local surgeon is not personally buying the $20M in infrastructure required for many modern advanced treatments. Venture capital has been essential for progress in medicine, and many advanced therapies are going to be increasingly delivered vertically integrated for the widest accessibility and best outcomes.
- bonsai_spool 13d ago
  > Venture capital has been essential for progress in medicine VC's can still fund companies that are making expensive new products. Banks (and PE...) can still underwrite loans for these things. We have many solutions for capex-intensive businesses and have had these for over four hundred years. LBO-type PE is not even fifty years old yet
  - frisco 13d ago
    agreed but that is not what they are talking about banning -- "PE" is expansive and includes all those other things. If they narrowed this proposal to just what people are thinking of as "PE" here rolling up clinics and gaining local pricing power that would be different and I'd agree with you
    - bonsai_spool 13d ago
      > agreed but that is not what they are talking about banning I think you misunderstand me. I think what is proposed to be banned (employers of doctors who are PE firms) should not exist. It is strictly not necessary, and there's an excellent example of the consequences playing out across Massachusetts right now (which explains the bill's introduction by Warren).. I'm not sure how we decided only lawyers can run law firms but that anybody can operate a hospital...

drknownuffin 13d ago

I have no words for how completely toxic the surge of PE in healthcare has been. It's driven the degradation of care everywhere I've been. Healthcare chains have no issues with investment (see any annual reporting document to see how much money is sitting in various investments, mostly RE); smaller clinics being eaten up by PE chains is not an answer to centralization, it's just another mechanism of it.

frisco 13d ago
"Private equity" also includes venture capital here. It means all private direct investment. The thing you are imagining is one small corner of what private equity actually is.

vjvjvjvjghv 13d ago

" less innovation" "Innovation" as in marketing expenses and stock buybacks?

BLKNSLVR 13d ago

It feels to me as if the US is a useful example for the outcomes of a focus on capitalist ideals does for medical services in a country. Apologies if an AI summary is offensive to some, but here we go: > The US is a world leader in advanced and specialist medicine, but its overall system for providing affordable, accessible, equitable medical care to its citizens ranks poorly—last among the 10 comparable high-income countries in the strongest recent comparison. Both sources are the same site: https://www.commonwealthfund.org/sites/default/files/2024-09/PDF_Blumenthal_mirror_mirror_2024_Exhibits.pdf https://www.commonwealthfund.org/sites/default/files/2024-09... https://www.commonwealthfund.org/publications/fund-reports/2024/sep/mirror-mirror-2024 https://www.commonwealthfund.org/publications/fund-reports/2...