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Posted by paimapi 1 day ago

Bill to Ban Private Equity from Owning Medical Practices(truthout.org)
497 points | 368 commentspage 2
balderdash 1 day ago|
I feel like medical practices should be like law firms where effectively non-lawyers can’t own equity and equity owners have to comply with ethics and code of conduct rules…
twoodfin 1 day ago||
Because lawyers are notoriously affordable and transparent in their pricing & quality?

There’s a reason very few guild-like professions have survived to the present day.

nradov 1 day ago||
Most doctors don't want to be business owners. It used to be that they were kind of forced to operate in partnerships but now most choose to become employees. This might be worse for patients but for better or worse there's no going back.
balderdash 1 day ago|||
Can you cite - antidotally the only doctors I know that would rather be an employee work for big hospital chains or already sold their practice for a pile and are happy with less responsibility.
octoberfranklin 1 day ago|||
Most doctors don't want to be business owners.

Then they should work for the doctors who do.

Also, I don't think they're particularly opposed to owning their practice. I can understand them not wanting to manage a business. But for that problem, they can hire professional managers. Which is basically how hospitals work; if the doctors all want the CEO replaced, he gets fired. There's a physicians board and the trustees tend to listen to it.

nradov 1 day ago||
So you're proposing to create a privileged class of investors with MD degrees who are protected from competition and will be able to earn above-market returns on their equity? Why would we want provider organizations to have a higher cost of capital? Makes no sense at all.
balderdash 1 day ago|||
Yes they will earn above market return on a lower capital base with medical shares in medical practice trading closer to book value - and the economics are the profit share not equity value of the firm. Earning $250k/yr on a $1m capital contribution requires a whole lot less rent seeking than earning the same $250k on a $5m share purchase.
octoberfranklin 9 hours ago|||
If you want to look at it that way there's already a much worse problem; a "privileged class" of service providers has a government-enforced total monopoly on the market for medical practice!

Gasp! The horrors!

tiffanyh 1 day ago||
How do you even define PE?

Because there’s many shades of gray here, no?

jchook 1 day ago||
Warren was a 1980s Republican who did legal work on behalf of major corporations including Big Oil vultures.

She stayed in the race for Super Tuesday in 2020 rather than consolidating the progressive vote for Sanders.

Right before, her campaign accepted millions in funding from billionaires after promising not to. Her comment was roughly, as soon as others stop taking billionaire money, I will stop.

JumpCrisscross 1 day ago||
Make it a leverage limit. Otherwise you’ll have other players come in and replicate the playbook.

The short-term fix is banning PE. The long-term one is restricting the leverage these groups can take. Then put limits on upstream leverage. We have these across our economy. We just don’t apply them to this sector.

kasey_junk 1 day ago|
This is the right response.

Most state bar associations require a lawyer (or group of them) to own law firms. That _doesnt_ prevent law firms from doing crazy deals to gain liquidity for their partners, including from private equity.

Dictating who has to “own” something just incentivizes people to separate ownership from financial benefit. In most cases that’s just plain worse than letting real ownership happen.

If there is a business practice you don’t like, regulate the practice, not the corporate structure.

s1artibartfast 1 day ago||
How does it define PE?
mhh__ 1 day ago||
You know what american healthcare really needs is more regulation!
nielsbot 1 day ago|
Are you saying it needs less? Why do you think that?
mhh__ 1 day ago||
yes. It's completely insane that health insurance A) does all price discovery B) is tied to your employer.

Ask an American hospital how much something costs - you will get a completely fake price back, this is a sign of a totally broken market.

drknownuffin 1 day ago|||
The 'fake' price is due to the negotiation of reimbursement between major healthcare chains and insurers. The most regulated piece - Medicare - is the only piece where there's fairly transparent pricing.
mhh__ 1 day ago||
> reimbursement between major healthcare chains and insurers

And why is this so prevalent? It's subject to huge subsidy and regulatory capture

BugsJustFindMe 1 day ago||
> And why is this so prevalent?

Because the law doesn't force them not to?

It's very wild to me that you're like "This organization is lying to me, so what we need less of is people telling them what to do."

AngryData 1 day ago||||
How is less regulation suppose to fix any of that?
BugsJustFindMe 1 day ago||||
> Ask an American hospital how much something costs - you will get a completely fake price back

You think the government tells hospitals to lie to you? The hospitals lie because the government doesn't force them not to. Laissez-faire capitalism causes that. Regulation is needed to fix it.

mhh__ 1 day ago||
https://en.wikipedia.org/wiki/Airline_Deregulation_Act
BugsJustFindMe 1 day ago||
I need you to help me connect the dots, because a bare URL is not the same thing as communication. What does the airline deregulation act have to do with hospitals giving you fake prices because nobody forces them not to?

What do you think would force hospitals to give you real prices if not the law?

vjvjvjvjghv 1 day ago||||
I am good with getting rid of B).

A) can probably only be fixed with regulation. Why would hospitals and insurance otherwise make prices transparent? The current state serves them really well.

mhh__ 1 day ago||
Because in a fair market they would be competed away - prices of food, computers, bonds, etc are not transparent because of regulation - it's largely because of the tax incentive as far as I've read from healthcare economists.
nielsbot 22 hours ago||
healthcare isn’t really a market economy and neither should it be.

we should make it a public a service without a profit motive

riddley 1 day ago|||
A and B are due to regulations?
mentalgear 1 day ago||
Most importantly to fight it as Private Equity is creeping like a cancer into good health systems globally, even in Europe, to slowly but surely siphon away all that is good.

It's important to fight it now before it is too late and other places also fall apart into a degraded, predatory, dystopian US system !

aurizon 1 day ago||
This has infested veterinary practices. Vet costs have increased 8-12% annually for 4-5 years now. The process approaches the vet saying their integrated back office system will save you local personnel and allow the vet to increase client service hours by wasting less on admin. Their system fractures a vet visit into service actions - each of which has a fee. They create a medication factory where a bottle of 100 tablets that cost $1 each becomes $5 a tablet, plus a dispensing fee. Over the past 6 years this has increased vet bills by 50-80%. Sadly, this brings people to abandon pets because they can not afford vet bills = death for the pet or a hard/short life as a stray. This private equity has also infested dentistry, which shows up as more dental bankruptcies as more people choose extraction over implants/root canals.
octoberfranklin 1 day ago||
I'm surprised that medical practices can be owned by anybody other than licensed physicians.

In most states a law firm's owners must all be individuals licensed to practice law (i.e. lawyers).

Why not the same thing for medicine?

carefree-bob 1 day ago|
I'm not so sure limiting competition is the way to go here. One thing I hate about US healthcare is the lack of price transparency. They would rather shut an entire hospital down before giving you a price sheet. So when outfits like Walmart were looking to get into healthcare and offer basic services like blood tests, checkups, xrays, and common procedures available for flat fees and published prices, the reaction of the US healthcare community was that of a primal scream of terror, and they - specifically hospital groups -- have mobilized an army of lobbyists to try to prevent anyone else from competing.

Hospitals are massive byzantine organizations with so many management layers and so many shady billing techniques, from charging for procedures not performed, to changing what they charge you based on when they find out how much you can pay, it's crazy. What other business forces you to sign a waiver agreeing to pay whatever they decide to charge you, without them telling you what that is, or they will refuse to serve you?

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