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That's really not true. Studies have shown that there's little correlation between care quality and profitability. In some cases non-profit health systems charg
by nradov 5d ago
That's really not true. Studies have shown that there's little correlation between care quality and profitability. In some cases non-profit health systems charge high prices and deliver terrible care quality. The reality is that most provider organizations are run by incompetent managers. People used to working in modern tech companies would be shocked to see the waste, inefficiency, and missed opportunities. PE acquisitions may cause some problems but the new managers do at least bring a basic level of discipline and operational competence that was often missing before.
- sailfast 5d agoModern tech companies are not managed well at all in my experience! They’re rife with waste. Management often makes terribly unprofitable decisions and often work to protect their slices of the pie rather than the org. Tech companies are saved by their margins, their aura, and low interest rates. Better examples might be grocery stores or other low margin businesses that require some fairly ruthless prioritization (at least that is what I’m to understand) To your care / profitability argument: that is good news! However, I do believe that concern for profitability will always outweigh a care quality argument so there is a misalignment of incentives in that case. I would look to insurers to demonstrate this, generally, but can imagine a PE-owned hospital system might attempt similar measures. Ideal outcome is a great manager that also cares and ends up paying doctors more and providing excellent care while driving down costs using better processes and negotiating with suppliers. But, uh… not sure how often the benevolent PE firm actually shows up historically.