The financial difficulties faced by Steward Health Care have put the company in a difficult position, but private equity participation in the Massachusetts health care industry has been increasing for a long time. According to officials, this trend is not only affected by one profit system.

Between 2013 and 2023, the Health Policy Commission (HPC) examined 182 purchases and sales of providers and found that the proportion of transactions involving private equity more than doubled during this period. Private equity was involved in about 25 percent of transactions between 2013 and 2016, which rose to 47 percent between 2017 and 2020 and to 63 percent between 2020 and 2023.

Leaders at HPC have been discussing this trend since December, but the problems at Steward have brought them into sharper focus. Health Policy Commission Executive Director David Seltz emphasized the need for urgent action to address the challenges posed by private equity, for-profit ownership, and industry consolidation in the health care sector.

The Health Care Financing Committee was tasked with investigating deficiencies in the state’s regulatory framework and recommending policy changes to prevent similar problems in other facilities. Seltz also noted that HPC was not informed of Medical Properties Trust’s purchase of Steward’s Massachusetts assets, which led to significant financial difficulties for the company. The situation is still evolving.

By Samantha Johnson

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