The Rising Influence of Private Equity in Massachusetts Healthcare: Addressing Regulatory Gaps and Ensuring Sustainability

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

The healthcare industry in Massachusetts is facing financial challenges, with private equity playing a significant role in shaping the landscape. According to industry officials, the presence of private equity in healthcare transactions has more than doubled in recent years, with for-profit ownership and consolidation continuing to shape the system.

The Health Policy Commission (HPC) has been closely monitoring this trend, revealing that private equity was involved in 63 percent of healthcare transactions between 2020 and 2023, up from just 25 percent between 2013 and 2016. This data highlights the growing influence of private equity on the healthcare system and raises concerns about regulatory oversight.

HPC Executive Director David Seltz emphasized the importance of addressing these issues to prevent future crises like the one currently 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 these challenges faced by healthcare providers.

Recent events have brought this issue to a critical juncture, with Medical Properties Trust acquiring Steward’s Massachusetts properties without notifying HPC. Discussions are ongoing, but it is clear that private equity interests are playing an increasingly important role in shaping the future of healthcare in Massachusetts. Comprehensive regulatory reform is essential to address these challenges and ensure a stable and sustainable future for patients and providers alike.

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