For Immediate Release
by Marie Follaytar, for Maine AllCare
Maine can’t afford private equity “investment” in our health care systems
Across the country we are encountering a growing healthcare crisis, as the mismanagement of private equity owned hospitals harms patient care and exploits people’s lives and health for short term profits. In an essay for JAMA Network, Physicians for a National Health Program’s founders David Himmelstein and Steffie Woolhandler discuss the problems with private equity in health care, posing the question: “Who Should Own Americans’ Health Care”?
After detailing the sordid saga of the collapse of the Steward Health Care system in Massachusetts; a system owned by Cerberus Capital Management and co-founded and led by Deputy Defense Secretary Nominee Stephen Feinberg, the authors discuss several “fundamental and difficult” incremental reforms and regulations that might help to prevent the disastrous outcomes experienced in Massachusetts. They conclude: “For Steward’s owners, and a growing share of healthcare proprietors, money has become the mission. Refashioning ownership to vest governance in locally accountable public agencies or tightly regulated nonprofit boards could help make health care institutions answerable to the communities they serve. Dominion over medical resources should reside with them, not with the highest bidder.”
Private equity’s management of hospitals in several studies has led to an alarming decline in patient care, and a reduction of hospital assets on average of 24% . Private equity-backed companies accounted for 7 of the 8 largest healthcare bankruptcies in 2024.
The potential impact of private equity upon Maine’s already unstable healthcare infrastructure and healthcare desert must be strategically assessed. Maine can’t afford private equity investors driving our hospitals into the ground, harming the health of our people, closing up shop and then selling the pieces off bit by bit as happened in Massachusetts. In fact, the hospital closures in Massachusetts impact Mainers who need specialty care not available in state.
Dr. Geoff Gratwick, former state senator and former board member of Maine AllCare, has formed a work group within Maine AllCare, to study the ways to avoid private equity takeover of hospitals in Maine. Says Gratwick: “Our patients and our communities suffer when private equity becomes involved in health care. We hope to identify other ways to help our struggling health systems here in Maine.”
Senator Mike Tipping(D) of Orono has responded to Dr. Gratwick’s concern. His bill (LR 1640 An Act to impose a Moratorium on the Ownership or Operation of Maine Hospitals by Private Equity Hospitals or Real Estate Investment Trusts) invites us to begin a statewide discussion of who should own our hospitals.
The bill would place a 5 year moratorium on private equity’s ability to directly or indirectly purchase a hospital in the state of Maine. The purpose of a moratorium is to preserve the non-profit status quo for Maine hospitals, and to make it easier for this and future Legislatures to make improvements in the Maine health care system for all Mainers.
In a 2023 analysis of 366 hospitals with 73 acquired by private equity, global measures of patient care experience revealed stark results as care worsened across the board. A 2024 NIH study compared 51 hospitals acquired by private equity between 2009 and 2019 and compared them with 259 hospitals not owned by private-equity, finding an increase in falls, infections and adverse events of a staggering 25.4% increase. It was also clear and troubling to find that patients who were sicker were more likely to be transferred out of the care of a private-equity owned hospital before dying thus lowering the reported death rate from the hospital.
On the federal level, Senators Elizabeth Warren and Ed Markey of Massachusetts submitted S.4503 – 118th Congress (2023-2024): Corporate Crimes Against Health Care Act | Congress.gov | Library of Congress establishing criminal and civil fines upon private equity owned healthcare in an effort to hold them accountable for harm. No other U.S. Senator signed on to Co-Sponsor the effort.
“When private equity gets hold of health care systems, it is literally a matter of life and death, so if you drive a hospital like Steward into bankruptcy, putting patients and communities at risk, you should face real consequences,” urged Senator Warren of Massachusetts.
In January 2025, a Bipartisan Report of the U.S. Senate Budget Committee released a report highlighting that private equity ownership of hospitals “harm patients, degrade care and drive hospital closures.”
Maine hospitals’ bottom line should be providing high quality health care to our people and not padding the balance sheet of out-of-state profiteers. Maine AllCare has long focused on ensuring healthcare coverage for all Mainers. It is our duty to advocate to preserve and maintain the healthcare infrastructure of this state, so that our people can access high quality health care in the current system and under the system of healthcare for all we envision for Maine.