The government agencies in the US have collaboratively initiated a cross-government public inquiry to scrutinise the growing influence of private equity companies and corporations in the healthcare sector.
The move aims to address concerns that profit-driven transactions could compromise patient care and healthcare affordability.
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The US Federal Trade Commission (FTC), the Department of Justice’s (DOJ) Antitrust Division, and the US Department of Health and Human Services (HHS) have released a RFI to gather public input on a range of healthcare-related deals.
These transactions mainly include those conducted by US health systems, private equity funds, private payers, and alternative asset managers and involve healthcare facilities and providers.
It covers deals that may not fall under the Hart-Scott-Rodino Antitrust Improvements Act’s reporting requirements for antitrust review.
In terms of transaction size, the threshold for HSR filings is currently $119.5m.
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By GlobalDataUS FTC chair Lina M Khan said: “When private equity firms buy out healthcare facilities only to slash staffing and cut quality, patients lose out.
“Through this inquiry, the FTC will continue scrutinising private equity roll-ups, strip-and-flip tactics, and other financial plays that can enrich executives but leave the American public worse off.”
The agencies noted that private equity and corporate healthcare ownership have significantly risen, prompting this cross-government inquiry.
This probe seeks to evaluate how such market transactions might foster consolidation and profit generation at the potential cost of patient health and care quality.
The inquiry encourages a diverse array of market participants, including patients, healthcare professionals, and consumer advocates, to submit comments on various healthcare transactions.
These include services related to dialysis, nursing homes, hospice care, primary care, hospitals, and more.
Comments can be submitted on Regulations.gov until 6 May 2024 and will be publicly accessible on the same platform.
The responses to the RFI will guide the agencies in setting enforcement priorities and considering future regulations to promote competition and ensure access to quality, affordable healthcare services.
A Bloomberg report highlighted that the DOJ is also evaluating major US companies, such as Apollo Global Management, Blackstone and KKR & Co, to address concerns that board directors with seats in rival companies in the same industry could lead to maximum gains for all, rather than competing to deliver services or lowest prices to people.
RFI’s responses will guide the agencies in setting enforcement priorities and regulations to ensure access to affordable, high-quality healthcare services.
