Hospitals Owned By Private Equity Are Harming Patients, Reports Find (arstechnica.com) 199
Private equity firms are increasingly buying hospitals across the US, and when they do, patients suffer, according to two separate reports. Specifically, the equity firms cut corners, slash services, lay off staff, lower quality of care, take on substantial debt, and reduce charity care, leading to lower ratings and more medical errors, the reports collectively find. ArsTechnica: Last week, the financial watchdog organization Private Equity Stakeholder Project (PESP) released a report delving into the state of two of the nation's largest hospital systems, Lifepoint and ScionHealth -- both owned by private equity firm Apollo Global Management. Through those two systems, Apollo runs 220 hospitals in 36 states, employing around 75,000 people. The report found that some of Apollo's hospitals were among the worst in their respective states, based on a ranking by The Lown Institute Hospital Index. The index ranks hospitals and health systems based on health equity, value, and outcomes, PESP notes. The hospitals also have dismal readmission rates and government rankings.
The Center for Medicare and Medicaid Services (CMS) ranks hospitals on a one- to five-star system, with the national average of 3.2 stars overall and about 30 percent of hospitals at two stars or below. Apollo's overall average is 2.8 stars, with nearly 40 percent of hospitals at two stars or below. The other report, a study published in JAMA late last month, found that the rate of serious medical errors and health complications increases among patients in the first few years after private equity firms take over. The study examined Medicare claims from 51 private equity-run hospitals and 259 matched control hospitals. Specifically, the study, led by researchers at Harvard University, found that patients admitted to private equity-owned hospitals had a 25 percent increase in developing hospital-acquired conditions compared with patients in the control hospitals. In private equity hospitals, patients experienced a 27 percent increase in falls, a 38 percent increase in central-line bloodstream infections (despite placing 16 percent fewer central lines than control hospitals), and surgical site infections doubled.
The Center for Medicare and Medicaid Services (CMS) ranks hospitals on a one- to five-star system, with the national average of 3.2 stars overall and about 30 percent of hospitals at two stars or below. Apollo's overall average is 2.8 stars, with nearly 40 percent of hospitals at two stars or below. The other report, a study published in JAMA late last month, found that the rate of serious medical errors and health complications increases among patients in the first few years after private equity firms take over. The study examined Medicare claims from 51 private equity-run hospitals and 259 matched control hospitals. Specifically, the study, led by researchers at Harvard University, found that patients admitted to private equity-owned hospitals had a 25 percent increase in developing hospital-acquired conditions compared with patients in the control hospitals. In private equity hospitals, patients experienced a 27 percent increase in falls, a 38 percent increase in central-line bloodstream infections (despite placing 16 percent fewer central lines than control hospitals), and surgical site infections doubled.
Yeah no shit (Score:5, Insightful)
Private equity exists to make profits. Hospitals exist to help sick people. Combine the two and you get "how can we profit from sick people"
The consequences of these two directives is going to create incentives that most people would find morally objectionable.
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Agreed. In the context of this study, medical errors generate more billable procedures, so they are incentived to cut corners especially if it increases the chance of billable problems. How many professions out there where you make more money when you screw up?
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Exactly and this is just one of many economic conundrums that healthcare for profit creates. The incentives, the supply/demand curve (how much would you pay not to die? For most the answer is infinite, how do you economically structure around that fact?) and just about everything about it runs counter to what we know of as "Free markets" operate.
That's why every developed nation outside the US has universal and highly regulated healthcare system.
Being pro-capitalism means understanding the sectors where it
Shit we sow. (Score:5, Insightful)
The consequences of these two directives is going to create incentives that most people would find morally objectionable.
The entire reason we're here discussing a highly profitable and legal business and not a known terrorist organization, is because we live in a society that only finds that kind of thing "morally objectionable" and not fucking criminal.
The shit we sow...
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The problem is that a huge portion of the country feels that exploiting the sick and suffering is not objectionable.
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Nah, you get "how can we destroy this before we flip it to some idiot"
That is what has happened every fucking time private equity got involved in a business.
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These kinds of horrors are no longer restricted to the USA. Over the past few decades, successive govts, Tory & Labour, have been letting in such shenanigans to the UK's NHS. John Pilger made a documentary about it. Free to view on his website: https://johnpilger.com/videos/... [johnpilger.com]
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I think it is more like "how can we spend as little as possible to treat people." Sure, they're harming (and killing) people now, but they'll get a few slap-on-the-wrist fines, tweak their algorithms, and find the most profitable middle where of course some people are harmed because we're cutting corners everywhere, but the numbers will be carefully managed so no one puts up a stink about it.
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One suspects that this may be why politicians are lusting after this model -- the lobbying that accompanies it means they could get a slice of the action. Under the table of course.
Re:Yeah no shit (Score:5, Interesting)
We understand that the doctor needs to be paid, but this isn't paying the doctor.
This is paying the greedy shareholders.
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His statement still stands.
We understand that the doctor needs to be paid, but this isn't paying the doctor.
This is paying the greedy shareholders.
There are no shareholders. Apollo runs private equity partnerships.
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...you do know private firms usually still have shareholders right, they're just not publicly traded.
Even a single owner business still has shareholders, the owner!
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...you do know private firms usually still have shareholders right, they're just not publicly traded.
Even a single owner business still has shareholders, the owner!
The investors are called partners. Source: I'm in 10 of them
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"Save it for the semantics dome, E.B. White"
Re:Yeah no shit (Score:5, Insightful)
His statement still stands. We understand that the doctor needs to be paid, but this isn't paying the doctor. This is paying the greedy shareholders.
And my legal point stands firm. If this kind of bullshit wasn't fucking legal, we wouldn't be sitting here talking about how much of a massive nationwide problem it is for damn near every citizen, regardless of the scam we call "insurance".
You want to fix this problem for good? Start with root cause. The entire country is captured by The Donor Class. Not sure why we're sitting here arrogantly assuming this is some kind of problem exclusive to the Medical Industrial Complex. Education, Banking, Military...the list is endless.
Re:Yeah no shit (Score:5, Insightful)
This is fairly spot on. In this case, medical providers nor even the for-profit owners of said facilities aren't the root cause.
Ask yourself who has the most to lose in the US if we switched to government run healthcare system like most other civilized countries. It's not the healthcare providers. If anything, we'd need more healthcare providers and facilities with socialized healthcare.
Know what we wouldn't need as much of? Insurance companies.
Thanks to them, US citizens are stuck with insane, unregulated basic healthcare costs that cannot be afforded without insurance.
That didn't happen by accident. Over the past few decades, they've rigged it from every angle (legally, politically, and financially) to the point where basic healthcare is financially crippling even for middle-class households, especially with children. Major incidents and/or long-term care scenarios are essentially bankrupting events for middle-class households without insurance.
People shouldn't NEED insurance to cover basic health care and medication for things like colds, flu, minor injuries and treatments of common illnesses like asthma, etc. The basics should be affordable out-of-pocket with insurance only being needed for major events, trauma, etc.
That's the core problem.
Re:Yeah no shit (Score:5, Informative)
Re:Public systems do say no (Score:5, Informative)
Where I live, I can see my doctor the same day if it's urgent, e.g. I need to be off work sick & claim statutory sick pay. Regular appointments are usually within a week, depending on the time of year. Prescription charges are pretty minimal (sometimes less that 2€) & waived if you can't afford to pay, e.g. unemployed, retired, or student. I once needed a chest x-ray & was in & out of the hospital in literally 10 minutes (Didn't even need to take my shirt off). Most hospitals & clinics are new &/or well kept & well-equipped. Everyone gets this regardless of social status or ability to pay, i.e. universal. Doctors & other medical staff are relatively well-paid & have excellent job security & professional opportunities. We also have one of the highest life expectancy rates in the world & people stay active & get out & about, well into their 80s & beyond.
I guess if you're stuck in the USA & desperately need health care, you could always head down to Mexico or Cuba. Are Americans allowed into Cuba?
Re:Yeah no shit (Score:5, Insightful)
The big difference in the smaller practice is that the shareholder (the doctor) has to look the patients in the eye and know them as people. He also has a direct responsibility to them. Otherwise, the patients are just numbers on a report and the shareholders can tell themselves that the patient's bad outcome has nothing to do with them.
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There's lots of small businesses where the aim is to make a decent living rather then get rich, this includes Doctors, at least the few I've known.
Re:Yeah no shit (Score:5, Interesting)
Again, all the above practices have "greedy shareholders". In the case of smaller practices, the shareholder is the doctor.
There is a difference between wanting to make money and offering an acceptable service for the money spent.
There's no problem with knowing some basic economics.
There is a problem with thinking that knowledge is sufficient to understand a much more complex situation.
Consider all of the things that your simplistic view is ignoring:
1) The value the owner/doctor derives from having an honest practice that serves its patients well.
2) The value that staff derive n working for a good boss in a good practice.
3) The desire the doctor has to be admired by their staff.
4) The desire of the doctor and staff to be known in their community as running a good a honest practise.
etc, etc, etc.
With even large private hospitals the ultimate decision makers are still in the business of providing health care, even with the profit motive they will regularly make decisions to forgo greater profit to improve the quality of health care, as will every person in the organization down to the janitors, and those same people down to the janitor will exert pressure upwards trying to improve the final product (healthcare).
I believe a public system is better, but a private system still consists of individuals trying to do the right thing.
The problem with private equity is it's designed to isolate decision makers from the consequences of their actions. The private equity firm decides it needs to improve profit and appoints hospital leadership with that target. Hospital leadership has no choice but to jeopardize the quality of care to make those targets, and all the local stakeholders have no choice but to work within those constraints.
Remember:
Man naturally desires, not only to be loved, but to be lovely [libertyfund.org]; or to be that thing which is the natural and proper object of love. He naturally dreads, not only to be hated, but to be hateful; or to be that thing which is the natural and proper object of hatred.
The trick of private equity is to detach people's natural desire to do good and honourable things from the running of a business.
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the ultimate decision makers are still in the business of providing health care, even with the profit motive they will regularly make decisions to forgo greater profit to improve the quality of health care
You are delusional. Many people are 'good' people. I would bet that you are one of the 'good' people. 'Good' people don't get to be in charge of large sums of money. Sociopaths do. They are not like you and in fact, depend on people like you assuming that they are like you in order to be effective at what they do. Their effectiveness is our misery.
That was kind of my point.
The bigger the structure and further removed the decision makers become the more sociopathic the decisions (both because the decision makers are more sociopathic and it's easier to look past the human consequences).
With smaller hospitals and practices you start getting more humanity in the decisions.
Re: Yeah no shit (Score:3)
The distance between the shareholder and the patient is the problem. The nebulous shareholder doesn't give a shit about "bad statistics" unless those are about profitability. The local doctor does care about patients because he has to live with them. It's just an example of why capitalism as a whole doesn't care about human suffering but individual humans do.
Re:Yeah no shit (Score:5, Interesting)
Salaries != profit. Payroll is a loss center, profit is what you get after payroll is made.
A private practice is just that, a private practice. To compare this to a private equity firm is... i don't want to say dishonest but massively oversimplifying.
Hospitals that are needed for wellbeing should not be judged on whether they are "in the red" but but the service they provide to their community.
"My kid died in the 60 minute trip to the nearest hospital but I understand that's what's necessary to maintain our system" is not exactly a great outcome.
Re:Yeah no shit (Score:4, Insightful)
Thank you? You get it. There's a difference between a single private practice doctor and an entire profit driven venture capital business. Thank you again, we are on the same page.
Yes, the closer hospital should not be shut down just because it's not profitable. You just are OK with people dying because of not enough profits? If that's your prerogative but I disagree and so does every other developed nation on the planet?
What is the defense of a market driven healthcare system and if it's so great why do so few countries do it that way?
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It's not yes/no, it's a gradient. There will always be cases where"Iif we just spent a bit more we could have saved them.", This is true at EVERY level of funding possible.
HOWEVER, hospital care should be a government service. It sure won't be perfect, but it could be a whole lot better for no more expense. There will still be people dying because there wasn't good enough care. The number will depend on what we chose to spend, and how we evaluate those who do the spending. (A really tricky problem.)
Pe
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I agree and specifically I did read a bunch of articles on how I believe the UK formulaically sortof figures out that line of when to apply care, something to the effect of "cost versus quality years of life gained by the cost" and it seemed about as fair and humane you could make such a thing and there was a system for appeals.
100% agree that really despite it's problems the NHS is to me the form of the "ideal" model, medical services is sortof like another military division. But I know that's just not gon
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If that's the case then that's a problem that needs to be addressed, whether that means consolidation, maybe you close a big hospital and open a bunch of more local urgent care centers in the towns. Maybe you increase Medicaid payouts, maybe the hospital is badly managed and you need to force a restructuring or maybe the circumstances means it serves a bunch of people but it just cant be profitable and we just have to subsidize it. Maybe we all as taxpayers put in a cent or two extra in the year so a poor
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Make urgent care able to handle more than the sniffles. The Washington Nationals can manage to give an IV in the visitor's clubhouse but a lot of Urgent cares cannot handle it.
Re:Yeah no shit (Score:5, Interesting)
You know why hospitals shut down? It's because they aren't funded by the government like they are supposed to be.
The minute you introduce (or re-introduce) private health care, the collective health of the community, and then then the country goes down the toilet.
Before Canada had "government health care", it was a fragmented patchwork of public and private provincial systems. And you know what that meant? Most hospitals were owned and operated by Catholic churches. Despite how the wait times for health care are in Canada, we're still in a much better position than we were in the 70's and where the US still is.
The US is caught in a problem of lacking government owned and operated hospitals and clinics, which means people only have the choice between "Sit at home and die" or "go bankrupt" that is so fucked up.
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Actually, the US has a large network of government owned and operated hospitals and clinics with at least one major medical center in pretty much every state; it's just that most of the citizens have chosen not to make themselves eligible to take advantage of it. Its called the VA.
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Did you seriously just say that the only way to earn community support for your health is to first risk your life? Are you for real?
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Re: Yeah no shit (Score:3)
It's a feature, not a bug. Make sure that poor people have no option than to join the mercenary army (no draft = mercenaries) and use it to ensure your preferences for global politics that enrich you continue to dominate.
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You know, starship troopers is meant to be an unpleasant satire, not a manual.
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Dig deeper and you may find that it wasn't that the hospital was unprofitable, but that it was simply LESS profitable than the ones that stayed open. Or that it would have been (somewhat) profitable if not for the huge drain caused by dead weight administrators and marble tile.
Re:Yeah no shit (Score:4, Informative)
That has to be one of the dumbest things that I have heard, any small business owner needs to make their salary separate from 'profits'
Failing to do so results in an owner who pulls money from the drawer like a bank account, resulting in attempts to short the tax man, short investors or just run the business into the ground
Salary: [nerdwallet.com]
You pay yourself a regular salary just as you would an employee of the company, withholding taxes from your paycheck. This is legally required for businesses that are structured as S-corporations or C-corporations or a limited liability company taxed as a corporation. The IRS has a “reasonable” compensation requirement, which means your salary should be comparable with what someone else doing the same job in your industry would be paid.
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Plenty of sole proprietorships operate this way. Only you have it backwards: usually the owner has to short their own pay just to keep the business running.
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Yes, that's the rules of running a business. Still, the tax-collector doesn't allow the self-employed to have profits: There's assets, liabilities, expenses and salary.
Worse, some bureaucratic bookkeeping doesn't allow sole-traders to claim sunk-cost expenses, such as depreciation. Meaning, one has to earn enough to leave the oppressing thumb of that bureaucrat, or close the business when there's insufficient salary (profit) to buy new equipment.
Re:Yeah no shit (Score:5, Insightful)
Every private practice ever has existed to make profits. Every small town doctor, etc.
Presumably more correctly, doctors and hospitals exist to help patients and need income to exist and some profits to endure. Given the huge amount of time, money and training involved to become a doctor, it's dubious that they do it simply/solely to "make profits" -- there are faster, less expensive educations and easier ways ways to make a living, even a really good, legit living, with *way* less hassle than being a doctor.
Re:Yeah no shit (Score:5, Insightful)
Exactly and also I don't imagine a world with a not-for-profit healthcare system where there are just poor starving doctors.
Doctor is and always will be an upper-echelon profession. It takes a lot of work and dedication to become a doctor, it's usually a passion for people who pursue it, they should be rewarded and usually are. It has little to do with how we operate healthcare on a nationwide basis.
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The problem here is people assuming that the drive for profit is the problem rather than
1).How they seek profits and
2). Why they started needing "excess" profits to avoid closure.
The unspoken subtext is "if we would just nationalize medical care the problem would just go away". Which is a false narrative. But nobody wants to come out and say that up front. First you have to demonize all profit motive. And here we are.
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The problem here is people assuming that the drive for profit is the problem rather than
1).How they seek profits and 2). Why they started needing "excess" profits to avoid closure.
The unspoken subtext is "if we would just nationalize medical care the problem would just go away". Which is a false narrative. But nobody wants to come out and say that up front. First you have to demonize all profit motive. And here we are.
I disagree. In a cooperative, civilized society, healthcare should be fundamental societal infrastructure, the same as roads, public education, food safety, and a bunch of other things. Because the government's job is to legislate and care for citizens, they're not in the habit of cutting costs and corners in order to make a profit. It's an imperfect system, but it works decently here in Canada, and by all reports I've heard it works even better in other countries which also have socialized medicine.
Contras
Re:Yeah no shit (Score:5, Informative)
No, you are changing the subject of the article, which is Hospitals
There are numerous non-profit hospital chains, which are not beholden to investors
Abrazos
Mayo Clinic
Banner
Honor Health
City of Hope
Re:Yeah no shit (Score:5, Insightful)
Every private practice ever has existed to make profits. Every small town doctor, etc. Making a profit means staying open. Hospitals that run in the red shut down:
http://ruralhospitals.chqpr.or... [chqpr.org]
Not true. Most hospitals used to be run as NON-profits. You don't need profits to run the hospital. You need to make enough to pay the staff and maintain the facilities, with a little left over on the top for rainy day fund, purchase new equipment, or occasionally expand. That is a far cry from MAXIMIZING profits at the expense of those other things.
There's a difference between running an organization with a goal of healing sick people where making enough money to stay open is a means to that end compared to running an organization to make money with healing sick people being a means to making money.
Also for a private practice profit == salary for the owner. There are no outside shareholders that need to be satisfied on top. Also, the doc at a private practice is personally liable if they cut corners, deliver bad healthcare and something goes wrong.
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Every private practice ever has existed to make profits. Every small town doctor, etc. Making a profit means staying open. Hospitals that run in the red shut down:
http://ruralhospitals.chqpr.or... [chqpr.org]
More to the point though, is it really all that surprising that two agencies that are philosophically opposed to private equity ownership of hospitals report that, surprise, private equity hospitals are bad?
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it really all that surprising that two agencies that are philosophically opposed to private equity ownership of hospitals report that, surprise, private equity hospitals are bad?
Bias tells us why they are using these facts in context but it doesn't change the facts they are stating from being true if they are in fact true.
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No, it's not surprising. Ideology often leads you to dig at things others feel comfortable ignoring.
Sometimes ideology leads you to fabricate evidence. Sometimes it leads you to find evidence. It is up to those to whom the evidence is presented to look at it and figure out if it's true or not.
Re: Yeah no shit (Score:3)
A private practice, the money flows to the practitioners. They use it to pay themselves and grow their business.
In private equity, all of the money is taken out, and used to purchase another company. No reinvestment, and all operations are squeezed financially.
In some businesses, yes efficiency helps them stay in business.
However, since the objective isnâ(TM)t long-term viability of the business, goodwill is not needed, so operations can be reduced beyond the point of providing value to their customers
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There's a big difference between corporate profit and individuals being paid for their services.
Think about it.
Medical industry corporations exploit workers, patients and the government to increase their profits.
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Your system has so many regulations involved that the enforcement of them all would probably create a system even more complex and costly than what we have today and a market so distorted by regulation that it is no longer a market at all. Why so much work and extra effort just to maintain a system where some shareholders can still profit off of it?
if we as a society don't want to leave people with preexisting conditions behind
There's the issue in it's compact glory. More than likely 99% of American citizens believe in this (as we have seen all Republicans back away from removing it)
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Healing patients means they are no longer patients and don't bring in any ongoing revenue.
What you actually want to do, is keep them sick but temporarily reduce the symptoms so they have to keep coming back for more treatment.
There's more (Score:4, Insightful)
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Ironically, the government drove a lot of this.
https://www.ama-assn.org/pract... [ama-assn.org]
While the top reason was getting paid:
"In fact, almost 80% of physicians indicated that the need to negotiate higher payment rates with payers was a âoevery importantâ (46.1%) or âoeimportantâ (33.4%) reason why their practice was sold to or acquired by a hospital or health system."
The second reason was administrative/regulatory requirements:
"Managing payersâ(TM) regulatory and administrative requirement
Re:There's more (Score:5, Insightful)
"In fact, almost 80% of physicians indicated that the need to negotiate higher payment rates with payers was a "very important" (46.1%) or "important" (33.4%) reason why their practice was sold to or acquired by a hospital or health system."
The second reason was administrative/regulatory requirements:
"Managing payers' regulatory and administrative requirements was the second most-cited reason.
Yeah, if only there were, I don't know, a single payer to deal with so there wouldn't be so much overhead. I worked at IDX Systems née GE Healthcare for over 15 years helping to build a $100M+ business unit whose only function was to intercede between private insurance and hospitals/group practices.
Government regulation actually brought costs down. Before HIPAA, many insurance companie didn't accept X12 claims, instead requiring some kind of proprietary format. Lots didn't even accept EDI claims full stop. We had to print the claims out and mail them on paper to the insurer. And of those that did, many did not have any kind of standard interface, instead requiring us to scrape a web page for n HTML <form> to automate submission, or dial into a modem bank and do char-cell scripting through a proprietary BBS.
It took a small army of support engineers just to keep the 100s of proprietary insurance interfaces running in the event that some small change on the insurer's side broke something since these were not meant as machine to machine interfaces.
HIPAA alleviated that somewhat by forcing everyone to take X12 and normalizing automated submission. There was still lots of work for us to massage claims and make sure procedures were properly coded and respond to ERAs but it knocked down costs to us and for our customers a lot.
Almost everyone I worked with except the suits (and even a lot of them) were pro single-payer. We saw the waste that our current system generated day in and out. We all would have loved to be legislated out of a job and see the insurers killed dead so we could focus more on quality of care rather than quality of billing.
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That "single payer" that you want already runs Medicaid and Medicare. That "single payer" already shorts providers 15% or more every time it pays patient bills - and that's on the stuff they agree to pay. That "single payer" is unaccountable.
That "single payer" is killing hospitals left and right.
Re:There's more (Score:4, Informative)
It actually supports the idea of a universal system as opposed to our current system.
Insurance in the USA creates something like a 30% overhead which is insane and literally millions of man hours in billing work.
Medicare and Medicaid run about 2-5% administrative overhead.
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The government is killing private practices and larger practices with onerous regulations
Why do we need so many regulations? Because private businesses in a realm without regulations will put profits over the best outcomes of the patients.
Some patients are just naturally going to cost a lot of money for care. SOmebody born with a congenital condition will likely never be "profitable". Is your stance that person should not get care? If you say they should, how do we care for it? In the pre-ACA world that's what happened, insurance said "nope, you're one your own". Do you support that world?
demand that the government nationalize the whole thin
St
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Slimy? At least I know my terminology when talking about these things.
Single payer means nationalization of insurance. You can have a single payer system with public insurance but private doctors and hospitals, in fact most single payer systems are. Also most single payer systems also have options for private insurance as well, something I explicitly don't like about Bernie Sanders plan is that there is no private option.
A full ownership of insurance and the facilities and personal is pretty rare, in fact
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I've seen you vigorously defending your stance through more comments than I'm willing to go back and count. I haven't once seen you outline specifically what the US needs to change in order for it to provide good, affordable medical care for all of its citizens, while still allowing for what I'll call 'third-party profits'.
Healthcare outcomes in the US are much poorer than in other developed nations, while delivering that healthcare is less efficient, more costly, and more likely to bankrupt patients. It se
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So a struggling not for profit sells out to private equity because... why? You may not like how the PE firm runs the hospital from that point forward, but you really have to wonder about a non profit or not for profit selling out like that. For the party selling, it sure is a bailout!
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The fact that we problems at all is proving the point of a universal system, the fact that hospitals are being judged on "profitability", the fact that our system is so wildly inefficient and with out of norms costs that the federal programs cannot keep pace.
If we seemingly both are taking KFF as a reputable source then you also have to take this data as a reputable fact:
How do healthcare prices and use in the U.S. compare to other countries? [healthsystemtracker.org]
The U.S. has higher prices for most health care services and presc
Some things shouldn't be for profit... (Score:5, Insightful)
Prisons and Hospitals are at the top of the list.
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The biggest misunderstanding most people have about non-profits is that they don't exist to make money. They absolutely do. Just because you're a 501(c) it doesn't mean there aren't hundreds of ways to get paid exorbitant amounts. The most common form of this is hiring "consultants" ( who do little but cash the check ).
The problem with hospitals/prisons isn't that they're "for profit", it's that there's a ton of money to be "filtered" ( laundered, tomato tomato ) through them. At the end of the day you
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Large nonprofit hospital systems also sink money into real estate, especially in the form of buying more hospitals. This has a double benefit because as they gain control of more facilities in the region, the more they can strong arm payers into higher fees.
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Prisons and Hospitals are at the top of the list.
And Presidents, Senators, Congressmen (et al), etc ...
Not all profits are bad. (Score:2)
Prisons and Hospitals are at the top of the list.
I think I can only go 50% in on your argument here.
I'm all for Hospitals not being part of that for-profit nightmare, but convicted killers sitting on Prison's death row who have zero fucks to give about the harm they've caused or the continued cost they are to the taxpayer? I say get Ahh-nold together with Dana White and bring back The Running Man UFC underground division, with 80% of the PPV proceeds donated to the victims.
Not all profits, are bad. Hell, who knows...we might actually create a real deter
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Except... they don't. It's as if the vast majority of crimes (i.e. transgressions of the social code) are the result of desperation, not choice.
But hey, the prison industrial complex loves your idea. After all, if we lock people up in an environment where they have to become sociopathic animals just to survive and after their term is up, they get thrown out with nothing but t
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convicted killers sitting on Prison's death row who have zero fucks to give about the harm they've caused or the continued cost they are to the taxpayer?
That's a really tiny percentage of the prison population.There are fewer than 2400 people on death row.
It wouldn't make sense for general prison policy to be driven by such a small group.
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convicted killers sitting on Prison's death row who have zero fucks to give about the harm they've caused or the continued cost they are to the taxpayer?
That's a really tiny percentage of the prison population.There are fewer than 2400 people on death row. It wouldn't make sense for general prison policy to be driven by such a small group.
You see a tiny percentage of the prison population.
I see a horrifically violent and effective message and deterrent being sent to anyone and everyone that's considering enacting that kind of violence on innocent people. Which is the main purpose of criminal punishment in society. Lives saved would be the main benefit of an actual deterrent.
I also see it as two thousand, four-hundred PPV main events, and a few billion in justification driven by investment monies. You know, regarding making "cents"...
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For profit prisons lobby the government for stricter and harsher punishments to put more people in prison. I stand by my statement.
Exploits (Score:5, Insightful)
Private equity is all about killing the golden goose for the eggs now, then stuffing and mounting the corpse and then selling to someone else, or back out to the public as an IPO.
The problem isn't necessarily with private equity - it's not like people don't know that when they come in, they're going to use leverage to buy the company, and then wring out the cash flow to pay dividends to themselves first, before forcing the company to use the remaining cashflow to service the debt that they used to to buy the company.
The problem is shareholder greed. Private equity is a liquidity event. Instead of waiting 10 years to get value, they're promising you the value up front today. You get money, they get the company for effectively nothing because it is all debt financed, and then they do things that basically destroy the long term viability of the business in exchange for short term valuation boosts to allow them to "extract" even more money.
If shareholders wanted, they could support defensive strategies like the poison pill:
https://www.investopedia.com/t... [investopedia.com]
But in most cases, they won't. Because they want the money now.
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I don't know the solution, but the problem is that the extracted value is not able to be stolen back if the company inevitably becomes insolvent. Calling it a dividend isn't even realistic.
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Higher interest rates help make leveraged buyouts more difficult.
https://www.philippehottinguer... [philippehottinguer.com]
When rates are low, companies are less likely to go under even when terribly mismanaged, so there are more opportunities to either kick the can down the road, or paper it over.
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Private equity funds are just a ponzi at this point. Once pension fund allocations go static or negative, it's all over.
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Many who sold out hospitals et al to private equity were non profits or not for profits. Stops and makes you think about why they sold out, doesn't it?
Government Granted Monopoly (Score:5, Interesting)
Welcome to another tale of "Government Granted Monoplies" *
The Medicaid and Medicare Act of 1965 created hospital monoplies.
No one can open a new hospital without the other hospitals agreeing
that the community "needs" another hospital.
Private equity firms buy Hospitals, knowing that they can legally prevent
competition. Then they exploit the customers. Not Surprising.
*Further Reference see US Telephone Companies, US Power Companies, etc.
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Doesn't stop hospitals with a majority of their patients using Medicaid and Medicare from shutting down though. Funny how that works.
The Feds can close hospitals and then turn around and prevent new ones from opening.
all hospitals (Score:2)
All hospitals harm patients. All hospitals are basically profit centers, whether or not the corporate papers say profit or nonprofit.
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There have been efforts to incentivize keeping patients out of hospitals.
https://www.cms.gov/medicare/q... [cms.gov]
Insurers (including medicare) don't want to pay claims if they can possibly avoid it. Even better, they don't want claims at all, hence those wellness programs.
The problem is, as you point out, providers don't normally get paid unless they see patients - the entire billing and coding system revolves around that. If you try and make things easier for your doctor by bringing up multiple issues in a sing
Private equity ruins ... everything (Score:5, Insightful)
Seriously. Pharma, housing, veterinary clinics, dentist clinics, and now hospitals.
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Yes, but let's recognize that not all private equity is the same.
Berkshire Hathaway is a private equity firm that invests in businesses for the long term. It is widely recognized as a well-run organization.
The key is long-term investments vs. short-term. Many PE firms are the equivalent of house flippers. They have no interest in the house, except as a way to cheaply spruce it up and sell at a profit. PE firms that are in it for the long term, tend to be much better at running the companies they own.
Has Private Equity EVER done anything well? (Score:2)
Has
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You can read about Berkshire Hathaway here: https://en.wikipedia.org/wiki/... [wikipedia.org] This PE firm owns companies like Geico, Fruit of the Loom, Justin Boots, Russell Corp, Benjamin Moore, Clayton Homes, Pampered Chef, and many others.
My previous employer, Envoy Mortgage, is owned by a PE firm with the goal of holding the company long-term. It was a great place to work, I only left because of the post-COVID downturn in real estate that gutted the mortgage industry.
It's true that the sleazeballs are in the majority,
PE should definately be banned (Score:2)
Wall St owns Pennsylvania Ave (Score:2)
What the report doesn't mention (Score:3)
I glanced over the report and it doesn't mention why medical facilities get sold to begin with. The first one I see in the report, Conemaugh Nason
Medical Center", they list service cuts but they don't mention that (from wikipedia) https://en.wikipedia.org/wiki/... [wikipedia.org] :
"In 2013 it was formally announced the Conemaugh was seeking affiliation with other medical systems in the region because of financial constraint"
Yet another Pump and Dump Scheme (Score:3)
Seems simple to me. Pump all the money out of patients and medical insurers and dump them while spending as little as possible. This is a straightforward capitalist recipe just applied to healthcare. :(
Known for years (Score:4, Interesting)
capitalism!! (Score:2, Flamebait)
professional management (Score:2)
I spoke with a dentist friend recently and he recently sold part of his practice to a management team, he still works as a dentist at the practice, he just doesn't do the day to day running of it any longer. He works fewer hours now.
He said that in the beginning he quite enjoyed running the practice, doing payroll and the accounts etc. but as the practice grew he wound up doing less and less dentistry and he missed that. Also he feels that the management team do a better job of that administration.
Privatized death panels (Score:2)
Universal healthcare and single-payer, NOW.
no different than insurance companies (Score:2)
insurance companies do the same. They look at the bottom line and tell the hospitals how to treat their patients. It is a no win situation for the patients.
True all around though, right? (Score:3)
All I ever hear are complaints when these big private equity firms buy up software companies or anything else.... They're all about the "maximize profits" part without any of the other standard rules or assumptions business owners usually include as part of that goal. (EG. Common sense dictates you must provide things like great customer service/care and high levels of customer satisfaction because happy customers will tell others and provide you with free marketing/advertising. Dissatisfied customers tend to tell 2-3x the number of people of their unhappiness, AND it's costly to do more marketing/advertising to replace them with new customers.) Private equity firms seem to ignore everything that doesn't boost short-term/immediate profit margins and they look at all their acquisitions as disposable as soon as they stop making enough to be worth keeping them.
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Canada's medical system --- which is in crisis mode at the moment --- is still cheaper per capita than the US system by a long shot and we have higher life expectancy. But I suspect capitalist bro will be deaf to facts.
And Canada's system is more expensive than most other systems in the developed world that are government-funded or mostly government-funded, so it's not even as if our system is particularly good, despite it being cheaper and better than the US.
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The realm of the stupidest arugments is saying "capitalism" and "socialism" are these circles that never overlap and the two things have zero compatibility with eachother.
If you are in fact a good and proper capitalist than you are supposed to understand where it's limits are. Market failures, natural monopolies, acutal monopolies, monopsonies, regulation, a justice system, etc are all factors in capitalism and important parts of it.
Part of that is understanding the economy is not one big block but hundred
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a tirade of refutations against the benefits of capitalism without any recognition of the fiscal accountability it brings, and a flood of comments uplifting of the glories of socialism without any rebuke of the lack of accountability and government waste it incurs. Slashdot readers, for the most part, being technical, cannot or - more likely - chose not to delve into the complexities and drudgery of a non-binary world. They have good jobs, they don't get dirty, they are untouched by gritty reality, and are mostly spoiled idealists. Prove me wrong.
Seeing capitalism and socialism as some sort of opposing forces just seems really silly and backwards to me. They're tools for society. Tools that can work together. See pretty much any first-world nation outside of the USA for examples.
And for the record, I've been a farmer. I've seen my share of dirt.