Private Equity’s Grip on the Massachusetts Healthcare Industry: An Examination of Regulatory Oversight Amid Concerns

Legislators focus on private equity’s role in health care following Steward Healthcare’s challenges

The healthcare industry in Massachusetts is facing significant financial challenges, with private equity playing an increasingly important role. According to industry officials, private equity involvement in healthcare transactions has more than doubled in recent years and is expected to continue as the industry consolidates and becomes more for-profit.

The Health Policy Commission (HPC) has been monitoring this trend, revealing that private equity was involved in 25 percent of healthcare transactions between 2013 and 2016. This number rose to 47 percent between 2017 and 2020 and further increased to 63 percent between 2020 and 2023. This data raises concerns about the impact of private equity on the healthcare system and the need for regulatory oversight.

HPC Executive Director David Seltz emphasized the importance of addressing these issues to prevent future crises like the one facing Steward Health Care. He stressed that urgent action is needed to ensure the stability and sustainability of the healthcare system in Massachusetts. Legislative leaders have tasked the HPC with investigating regulatory gaps and proposing policy changes to address the challenges faced by healthcare providers.

Recent events, such as Medical Properties Trust’s acquisition of Steward’s Massachusetts properties without notifying HPC, highlight the need for stronger regulatory oversight. As discussions continue, it is clear that the future of healthcare in Massachusetts is at a critical juncture, with private equity interests shaping its direction and comprehensive regulatory reform necessary to ensure its stability and sustainability.

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