Key Points
Question
How did measures of patient care experience change after private equity acquisition of US hospitals?
Findings
In this difference-in-differences analysis of 73 private equity–acquired hospitals and 293 matched control hospitals, global measures of patient care experience worsened after private equity acquisition of hospitals, as did patient-reported staff responsiveness. The difference in these measures of patient care experience at private equity–acquired hospitals compared with matched control hospitals increased with each subsequent year after acquisition.
Meaning
Patient-reported care experience, an important dimension of care quality, worsened after private equity acquisition of US hospitals.
Abstract
Importance
Private equity acquisitions of health care facilities have rapidly increased over the past decade. However, little is known about the effects of private equity acquisitions of US hospitals on patient care experience.
Objective
To evaluate whether the acquisition of hospitals by private equity firms was associated with changes in measures of patient-reported experience compared with matched control hospitals from 2008 through 2019.
Design, Settings, and Participants
This cohort study identified 73 US hospitals newly acquired by private equity firms and 293 matched control (nonacquired) US hospitals from 2008 through 2019. An event study, difference-in-differences design was used to evaluate changes in patient experiences measures from 3 years before to 3 years after private equity acquisition.
Main Outcomes and Measures
The primary outcomes were 2 global measures of patient-reported care experience from the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey, which included patients’ overall hospital rating and willingness to recommend the hospital. Secondary outcomes included the 7 other HCAHPS measures encompassing clinical process, communication, and environmental measures.
Results
There were 73 private equity–acquired hospitals and 293 matched control hospitals. The percentage of patients rating hospitals as a 9 or 10, on a scale of 0 to 10, decreased at private equity–acquired hospitals (65.0% before acquisition and 65.2% after acquisition) when compared with control hospitals (66.2% to 69.2%) during the postacquisition period relative to the preacquisition period with a difference-in-differences estimate of −2.4 percentage points (95% CI, −3.9 to −0.9). In addition, the percentage of patients who would definitely recommend the hospital also decreased at private equity–acquired hospitals (66.9% before acquisition and 65.5% after acquisition) compared with control hospitals (68.2% to 69.3%) with a difference-in-difference estimate of −2.1 percentage points (95% CI, −3.6 to −0.7). For both of these global measures of patient experience, the difference between private equity–acquired and control hospitals increased over time and was largest in year 3 after acquisition (−5.2 percentage points [95% CI, −8.8 to −1.5] and −4.4 percentage points [95% CI, −8.0 to −0.70] for each measure, respectively). For secondary measures of patient care experience, there was a decrease in patient-reported responsiveness of hospital staff at private equity–acquired hospitals compared with control hospitals (−1.3 percentage points [95% CI, −2.4 to −0.2]), but no differential change across other measures of clinical process, communication, and environment.
Conclusions and Relevance
Patient care experience worsened after private equity acquisition of hospitals. These findings raise concern about the implications of private equity acquisitions on patient care experience at US hospitals.
This cross-sectional study compares global patient measures to determine whether patients experienced a change in care and whether hospital communication, clinical process, and environment changed from before a hospital had been acquired to after it had been acquired by private equity firms.
Introduction
Private equity acquisitions of hospitals have increased over the past decade in the US.1, The growing presence of private equity in health care has been controversial, attracting widespread scrutiny from US congressional committees, health care leaders, and the public. This has been driven by concerns that private equity firms’ incentive to generate financial gains rapidly could have adverse implications for patient care.2,3,4
Although prior studies found that private equity acquisitions of hospitals led to reduced staffing and increased net income,5,6 there has been mixed evidence on quality and outcomes, with some studies suggesting lower mortality and others demonstrating higher adverse events after acquistion.5,7,8 However, little is known about whether patient care experience—an important dimension of quality that provides a unique lens on patients’ perspectives of care—changes after hospitals are acquired by private equity firms. Poor patient experiences with health systems are associated with slower recovery from illness, nonadherence with treatment regimens, and greater health care use,9,10 and improving patient-centered care experience has become a national priority for policymakers and health care leaders.11 Understanding whether care experience changes after private equity acquisition of hospitals could provide important patient-centered insights on the implications of this type of ownership structure, and inform the national policy debate about the growing presence of private equity in health care.
Therefore, in this national study, a difference-in-differences design was used to answer the following questions: First, did global measures of patient care experience change after hospitals were acquired by private equity firms compared with matched control (nonacquired) hospitals between 2008 and 2019? Second, were there changes in patient-reported measures of hospital communication, clinical processes, and environment?
Methods
Data Sources and Study Population
We identified US hospitals acquired by a private equity firm using mergers and acquisitions data from Irving Levin Associates and Pitchbook, which were then manually verified using official news releases, hospital websites, and other manual online searches, consistent with prior studies.5,7 We identified private equity acquisitions occurring between 2010 and 2017 to allow hospitals to contribute 3 years of data before the year of acquisition and 3 years of data after acquisition. We intentionally elected to not examine hospital acquisitions during or following 2018, to avoid overlap with the onset of the COVID-19 pandemic. In addition, we excluded any hospitals that were already owned by a private equity firm and then subsequently sold to another private equity firm during the study period. Using these criteria, we identified 73 US hospitals that were newly acquired by private equity firms between 2010 and 2017 (eFigures 1 and 2 in Supplement 1). Data from the American Hospital Association annual survey and Centers for Medicare & Medicaid Services (CMS) Impact Files were used to obtain information on hospital characteristics.
CMS Hospital Compare files were used to determine patient care experience measure scores for each hospital from Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey results. HCAHPS is a national, standardized survey that comprises 29 questions that ask recently discharged patients about their care experiences during their hospitalization.12,13,14 The survey is administered monthly to a random sample of patients between 48 hours and 6 weeks after discharge and is not restricted to Medicare beneficiaries. The survey uses a rigorous standardized protocol and has been deemed valid for use to assess hospital performance as part of CMS public reporting, payment, and quality programs.11,15 The survey can be administered by hospitals via 4 different survey modes: mail, telephone, mail with telephone follow-up, or active interactive voice recognition.16 The survey is available in multiple languages, including English, Spanish, Chinese, Russian, Vietnamese, Portuguese, and German. Survey results account for patient mix, including age, sex, language, education, self-reported health status, and service line. In addition, adjustments are made for mode of data collection and nonresponse.17 More than 2.5 million surveys are completed annually, with greater than 7500 patients completing the survey daily. Response rates for the HCAHPs survey are reported by hospital, and national mean response rates ranged between 25% and 33% over the study period (annual response rates are shown in eTable 1 in Supplement 1).18 CMS publicly reports hospital performance on 10 measures based on HCAHPS data on the Hospital Compare website.
Outcomes
The main outcomes were 2 global measures of patient care experience from HCAHPS: patients’ overall hospital rating (scale of 0 [“worst possible hospital] to 10 [“best possible hospital”]) and patients’ willingness to recommend the hospital (options were “definitely no,” “probably no,” “probably yes,” or “definitely yes”). For each measure, we determined the percentage of patients reporting the “top-box response” or the most positive category response. For the overall hospital rating measure, CMS designates a response of 9 or 10 as a top-box response. For the patients’ willingness to recommend the hospital, CMS designates “definitely yes” as a top-box response.
Secondary outcomes included 7 other measures focused on clinical processes (staff responsiveness and discharge information), communication (communication with nurses, communication with doctors, communication about medications), and hospital environment (cleanliness and quietness). Survey responses to questions for each of these measures were “never,” “sometimes,” “usually,” or “always [top-box response]” for all measures, except for discharge information (options were “yes” or “no”). The care transition measure of HCAHPS was introduced in 2013 and was excluded from the analysis given lack of data prior to this year. Further details on the individual HCAHPS survey questions that contribute to each measure are shown in eTable 2 in Supplement 1.
Statistical Analysis
We first matched the 73 hospitals acquired by private equity firms to a control group of hospitals that were not acquired. To do so, we matched each private equity–acquired hospital with up to 5 control hospitals based on the following characteristics: bed size, ownership type (for profit, nonprofit, and government), teaching hospital status, metropolitan vs nonmetropolitan location, safety-net status (top quartile of Disproportionate Share Hospital index nationally),15 9 census geographic regions, and year. This exact matching process resulted in 293 matched control hospitals (Table 1).
Table 1. Characteristics of Private Equity–Acquired and Matched Control Hospitals.
| No. (%) of hospitals | ||
|---|---|---|
| Private equity acquired (n = 73) | Matched control hospitals (n = 293)a | |
| No. of beds, median (IQR) | 130.5 (55-263) | 133 (73-248) |
| Hospital size | ||
| Large (≥350 beds) | 9 (12.3) | 33 (11.3) |
| Medium (100-349 beds) | 35 (48.0) | 159 (54.3) |
| Small (<100 beds) | 29 (39.7) | 101 (34.5) |
| Medical ICU beds, median (IQR) | 9 (4-46) | 10 (6-20) |
| Ownership status | ||
| Nonprofit | 35 (48.0) | 148 (50.5) |
| For profit | 33 (45.2) | 124 (42.3) |
| Government | 5 (6.8) | 21 (7.2) |
| Teaching hospitalb | 22 (30.1) | 59 (20.1) |
| Metropolitan | 54 (74.0) | 210 (71.7) |
| Nonmetropolitanc | 19 (26.0) | 83 (28.3) |
| Census divisions | ||
| West South Central | 17 (23.3) | 68 (23.2) |
| East South Central | 11 (15.1) | 49 (16.7) |
| South Atlantic | 10 (13.7) | 52 (17.8) |
| Pacific | 8 (11.0) | 36 (12.3) |
| New England | 8 (11.0) | 22 (7.5) |
| Mountain | 7 (9.6) | 25 (8.5) |
| Middle Atlantic | 6 (8.2) | 22 (7.5) |
| East North Central | 5 (6.9) | 14 (4.8) |
| West North Central | 1 (1.4) | 5 (1.7) |
| Medicaid’s share of discharges, median (IQR), %d | 29.3 (20.1-38.8) | 29.2 (21.0-36.6) |
| ED visits per year, median (IQR) | 19 270 (10 152-44 675) | 24 664 (13 929-42 873) |
| HCAHPS survey response rate, median (IQR), % | 27.8 (23-32) | 28.4 (23-33) |
Abbreviations: ED emergency department; HCAHPS, Hospital Consumer Assessment of Healthcare Providers and Systems; ICU, intensive care unit.
Private equity–acquired US hospitals and nonacquired control hospitals were matched based on the following variables: bed size, ownership type (for profit, nonprofit, and government), teaching hospitals status, metropolitan vs nonmetropolitan location, safety-net, census, geographic regions, and year.
Defined as hospitals with medical school affiliations reported to American Medical Association or members of the Council of Teaching Hospitals and Health Systems.
Determined based on county-level rural-urban continuum codes, a classification scheme based on population size and degree of urbanization based on adjacency to a metropolitan area. There are 9 codes, with 1 through 3 considered metropolitan, and 4 through 9 considered nonmetropolitan areas.
Defined as the percentage of Medicaid payments. Data obtained from Centers for Medicare & Medicaid Services Impact Files.
We used an event study, difference-in-differences design to evaluate changes in outcomes after private equity acquisition of hospitals.19,20 An event study framework or dynamic difference-in-differences design is used when the timing of treatment (private equity acquisition) is staggered and the treatment effect is dynamic, meaning the effect may vary over time. The acquisition year was considered time 0, and we evaluated outcomes during the 3 years prior to acquisition and 3 years after acquisition for each hospital. For the 15 hospitals acquired in 2010, we included 2 years of preacquisitions data, and for the 18 hospitals acquired in 2017, we included 2 years of postacquisition data due to the onset of pandemic-related care disruptions in 2020. A linear regression model was fit for matched hospitals, which included interactions of relative year with a variable indicating whether a hospital was acquired by private equity, as well as a year variable (to account for national trends). The coefficient on the interaction term for a given relative year (eg, year +1, year +2, or year +3 after acquisition) represents the difference-in-differences estimate of the effect of private equity acquisition for each year after acquisition. The average treatment effect was also estimated using a doubly robust approach, and represents the mean difference in outcomes between private equity–acquired vs matched control hospitals during the entire postacquisition period compared with the preacquisition period. Standard errors were clustered at the hospital level. The parallel trends assumption was tested for all outcomes (eTable 3 in Supplement 1).
We performed sensitivity analyses. First, we repeated our main analysis after excluding the year of acquisition and the year following acquisition, given possible lag effects between timing of acquisition and potential changes in care delivery. Second, we performed the analysis limited to hospitals with all 3 years of preacquisition data and 3 years of post-acquisition data. Third, as an alternative research design, we performed an interrupted time series analysis of private equity–acquired hospitals to estimate changes in trends for outcomes after acquisition.
All analyses were performed using RStudio (version 2023.12.1) and SAS EG 7.15 (SAS Institute Inc). The institutional review board at Beth Israel Deaconess Medical Center deemed this study exempt because it used hospital-level data without patient identifiers. This study followed the Strengthening the Reporting of Observational Studies in Epidemiology (STROBE) reporting guideline.
Results
There were 73 hospitals that were acquired by private equity firms and 293 matched control hospitals over the study period (2008-2019; eFigures 1 and 2 in Supplement 1). The characteristics of private equity–acquired and matched control hospitals are shown in Table 1. The number of acquisitions by year is shown in eTable 4 in Supplement 1.
Global Measures
The percentage of patients rating hospitals as a 9 or 10 of 10 did not change at private equity–acquired hospitals (65.0% before acquisition and 65.2% after acquisition) but increased at matched control hospitals (66.2% to 69.2%; Table 2 and Figure 1A). There was a decrease in patient ratings (of 9 or 10 of 10) at private equity–acquired hospitals compared with control hospitals during the postacquisition period relative to the preacquisition period, (difference-in-differences estimate, −2.4 percentage points [95% CI, −3.9 to −0.9]; Table 2). The difference between private equity–acquired hospitals and control hospitals increased with each subsequent year following acquisition and was largest in postacquisition year 3 (difference-in-differences estimate, −5.2 percentage points [95% CI, −8.8 to −1.5]; Figure 2).
Table 2. Changes in Patient Care Experience Measures After Private Equity Acquisition of US Hospitals (After vs Before Acquisitions Periods)a.
| Measure description, patient response | Private equity–acquired hospitals, % (n = 73) | Matched control hospitals, % (n = 293)b | Difference-in-differences, percentage points (95% CI)c | |||||
|---|---|---|---|---|---|---|---|---|
| Before acquisition | After acquisition | Change | Before acquisition | After acquisition | Change | |||
| Global measures (primary outcomes)d | ||||||||
| Overall rating of hospital | 9 or 10 on a scale of 0-10 | 65.0 | 65.2 | 0.2 | 66.2 | 69.2 | 3.0 | −2.38 (−3.88 to −0.89) |
| Willingness to recommend hospital | Would “definitely recommend” | 66.9 | 65.5 | −1.4 | 68.2 | 69.3 | 1.1 | −2.14 (−3.59 to −0.68) |
| Secondary outcomes | ||||||||
| Clinical process measures | ||||||||
| Responsiveness of hospital staff | “Always” received help as soon as they wanted it | 62.1 | 63.5 | 1.4 | 63.2 | 65.4 | 2.2 | −1.31 (−2.43 to −0.18) |
| Discharge information | “Yes” they were given information about what to do during their recovery at home | 80.7 | 83.6 | 2.9 | 82.3 | 85.1 | 2.8 | 0.06 (−0.88 to 1.00) |
| Communication measures | ||||||||
| Doctor | “Always” communicated well | 79.3 | 78.7 | −0.6 | 80.1 | 80.3 | 0.2 | −0.54 (−1.70 to 0.62) |
| Nurse | “Always” communicated well | 74.6 | 75.6 | 1.0 | 75.4 | 77.7 | 2.3 | −0.83 (−2.00 to 0.34) |
| Medication communication | Staff “always” explained medications before giving it to them | 59.3 | 61.3 | 2.0 | 60.3 | 63.0 | 2.7 | −0.64 (−1.88 to 0.59) |
| Hospital environment measures | ||||||||
| Cleanliness | Room and bathroom were “always” clean | 69.5 | 70.8 | 1.3 | 69.7 | 71.4 | 1.7 | −0.81 (−2.49 to 0.88) |
| Quietness | Area around their room was “always” quiet at night | 58.3 | 60.4 | 2.1 | 59.2 | 60.6 | 1.4 | −0.42 (−1.70 to 0.86) |
The Centers for Medicare & Medicaid Services (CMS) defines a “top-box response” as the most positive category response to Hospital Consumer Assessment of Healthcare Providers and Systems survey items. The exception to this is for the overall hospital rating measure, for which CMS designates a rating of 9 or 10 out of 10 as a top-box response.
Private equity–acquired hospitals were matched to control hospitals based on year, ownership, geographic region, bed size, teaching hospital status, metropolitan vs nonmetropolitan location, and safety-net status.
The difference-in-differences estimate represents the mean (percentage point) differential change between private equity-acquired and matched control hospitals during the postacquisition period compared with the preacquisition period.
Primary outcomes for the analysis: overall rating of hospital, willingness to recommend hospital.
Figure 1. Trends in Patients’ Global Rating of Hospitals Before and After Private Equity Acquisition.
A, The Centers for Medicare & Medicaid Services (CMS) designates a response of 9 or 10 as a top-box response to the question: “Using any number from 0 to 10, where 0 is the worst hospital possible and 10 is the best hospital possible, what number would you use to rate this hospital during your stay?”
B, CMS designates a response of “definitely yes” as a “top-box response” to the question: Would you recommend this hospital to your friends and family?
The figure shows annual trends in performance on global hospital rating measures (primary outcomes) at private equity hospitals and matched control hospitals. The boxes indicate values within the IQR (25th to 75th percentile); the bold horizontal lines in the boxes, the median; the upper and lower whiskers, the highest and lowest values within 1.5 times the interquartile range; the dots, outliers; and the year 0, the year of acquisition by private equity. The orange and blue lines connect the median values for private equity–acquired and matched control hospitals, and the dots along those lines between boxes represent mean values for each hospital group. eFigure 4 in Supplement 1 shows the observed annual trend lines for these outcomes.
Figure 2. Changes in Global Patient Care Experience Measures Over Time After Private Equity Acquisition of US Hospitals.
aThe value for the before acquisition period represents the mean outcomes for each measure in the preacquisition period and thus is same for each year.
bPrivate equity–acquired hospitals were matched to control hospitals based on year, ownership, geographic region, bed size, teaching hospital status, metropolitan vs nonmetropolitan location, and safety-net status.
cThe difference-in-differences estimate represents the effect of private equity acquisition by year, comparing outcomes for each postacquisition year to the preacquisition period.
The percentage of patients who would definitely recommend the hospital decreased at private equity–acquired hospitals (66.9% preacquisition and 65.5% postacquisition) but increased at control hospitals (68.2% to 69.3%; Table 2 and Figure 1B), resulting in a differential change of −2.1 percentage points (95% CI, −3.6 to −0.7) during the postacquisition period relative to the preacquisition period. The difference between private equity-acquired hospitals and control hospitals increased with each year after acquisition, and was largest in postacquisition year 3 (−4.4 percentage points [95% CI, −8.0 to −0.70]; Figure 2).
Clinical Processes
The percentage of patients reporting that they always received help when they wanted it from hospital staff (responsiveness of hospital staff measure) is shown for private equity–acquired and control hospitals in eFigure 3, A in Supplement 1. After acquisition, there was a decrease in patient-reported staff responsiveness at private equity hospitals compared with control hospitals (difference-in-differences estimate, −1.3 percentage points [95% CI, −2.4 to −0.2]; Table 2). In contrast, the percentage of patients reporting that they received discharge instructions increased similarly at private equity hospitals and control hospitals, and there was no differential change between these groups (eFigure 3, B in Supplement 1 and Table 2).
Communication
The percentage of patients reporting that their doctors always communicated well decreased at private equity–acquired hospitals and increased at control hospitals, but the differential change after acquisition was not statistically significant (difference-in-differences estimate, −0.5 percentage points [95% CI −1.7 to 0.6]; eFigure 3, C in Supplement 1 and Table 2). In addition, the percentage of patients reporting that nurses always communicated well increased at both private equity–acquired and control hospitals, and there was no differential change between these hospital groups after acquisition (eFigure 3, D in Supplement 1 and Table 2). These patterns were similar for the measure assessing the percentage of patients reporting that staff always explained medications before giving it to them (eFigure 3, E in Supplement 1 and Table 2).
Hospital Environment
There was no differential change in percentage of patients reporting that their room and bathroom were always clean (cleanliness of hospital environment measure) and the percentage of patients reporting that the area around their room was always quiet at night (quietness of hospital environment measure) at private equity–acquired hospitals compared with control hospitals (eFigure 3, F and G in Supplement 1 and Table 2).
Sensitivity Analysis
Our findings for overall measures of patient care experience were highly consistent in our sensitivity analysis that excluded the year of and following acquisition (eTable 5 in Supplement 1). Similar patterns were observed when we limited our analysis to hospitals with 3 years of before and after acquisition data (eTable 6 in Supplement 1), although the hospital staff responsiveness measure was no longer statistically significant. In addition, our main findings were consistent when we evaluated for changes in annual trends of outcomes after acquisition using an interrupted time series approach (eTable 7 in Supplement 1).
Discussion
In this national study, global measures of patient care experience worsened after private equity acquisition of US hospitals. The difference in overall patient care experience measures between private equity–acquired hospitals and control hospitals grew with each subsequent year after acquisition, reaching approximately 5 percentage points by year 3 of acquisition. For context, these changes exceed the 3.6 percentage point decline in patient care experience scores observed nationally during the COVID-19 pandemic.21 In addition, there was some evidence that patient-reported staff responsiveness decreased after acquisition, although there were no significant changes in measures of communication or hospital environment (eg, cleanliness). Improving patient-centered care is a major policy priority, and these findings provide important insights on how patients’ care experience may change after hospitals are acquired by private equity firms.
The growing presence of private equity in health care has drawn widespread attention from policymakers and is being actively investigated by Congress.4 Although a prior cross-sectional study found that patient satisfaction scores were lower at private equity hospitals when compared with other hospitals,22 this analysis estimates how private equity acquisitions impact patient care experience over time using a quasi-experimental design. Patient-reported care experience is a critically important dimension of quality and provides a unique lens into patients’ interactions with health systems. In addition, prior studies have found that patient experience scores are associated with other important quality metrics, including patient safety, readmissions, and mortality.10,23,24,25,26 The finding reported in this study that patient-centered care experience worsened at hospitals that were acquired by private equity builds on a recent analysis by Kannan et al,7 which demonstrated an increase in adverse events at these sites, and highlight the implications of private equity acquisitions on multiple domains of quality.
The decline in patient care experience after private equity acquisition may, at least in part, reflect changes in organizational structure made by these firms. Nurse staffing is associated with global patient care experience scores, and prior analyses have found that private equity owned hospitals often reduce nurse-to-bed ratios, in addition to having fewer overall staff when compared with nonacquired hospitals.27,28 This may explain why some evidence of a decrease was observed in patient-reported responsiveness of staff at private equity–acquired hospitals. Furthermore, private equity acquisition of hospitals leads to higher charge to cost ratios and higher profit margins through cost-cutting practices.5,6,28 Although it is difficult to ascertain all the organizational strategies used by private equity firms to improve financial returns based on publicly available data, these findings emphasize that patient-centered care may be negatively impacted by such practices.
This analysis also found that the decrease in global patient experience scores at private equity hospitals compared with control hospitals steadily grew with each year following acquisition. These findings suggest that the incremental effects of organizational and structural changes implemented by private equity may accumulate over time. For example, an approximate 2–percentage point reduction in top box global patient experience scores was observed at private equity hospitals (vs control hospitals) in year 2 after acquisition, a change that roughly doubled to 5 percentage points by year 3. This differential decrease in patient experience scores at private equity hospitals is considered “large” in magnitude based on prior studies that have empirically quantified changes in patient experience29,30 and is particularly notable given that patient experience scores were improving nationally prior to the onset of the pandemic. In addition, although there was a significant reduction in the responsiveness of hospital staff at private equity–acquired hospitals, significant changes in other measures of communication and hospital environment were not observed, likely because these specific domains do not capture all of the factors that contribute to patients’ overall care experience.
There is growing concern that the strategies employed by some private equity firms may not be aligned with clinician and health system efforts to improve patient care.31 These findings are important for policymakers weighing the future of private equity acquisitions in health care because patient experience scores may reflect changes in practice that are otherwise difficult to capture with other types of outcome measures (eg, readmissions). Experts have suggested that improved oversight of acquisitions, including increased transparency of private equity transactions and the implementation of policies to protect patients (such as minimum staffing ratios) should be considered as the influence of private equity in the health care sector continues to grow.2,32
Limitations
This study has several limitations. First, data on private equity acquisition of US hospitals are relatively opaque. However, data from established national datasets were used, consistent with prior analyses and then manually verified using other sources (eg, manual searches, hospital websites).5,8 Second, the HCAHPS survey is sent after patient discharge, so there is a risk of nonresponse bias. However, prior assessments of HCAPHS have found that the likelihood of nonresponse bias is minimal, and the survey adjusts for patient factors (eg, age, health status), nonresponse, and mode of delivery,33,34,35,36,37 in addition to employing a rigorous standard protocol and has been deemed valid for use in CMS public reporting and payment programs.11,38,39,40 Nevertheless, it is possible that other unmeasured characteristics influence nonresponse rates. Third, there is mixed evidence on whether patient case mix changes after private equity acquisition of hospitals.5,7 One recent analysis found no differential changes in clinical risk scores, race, or ethnicity at acquired vs nonacquired hospitals but did observe a modest reduction in mean age (0.1 years), whereas another study found that hospital service line offerings can change after acquisition.41 However, HCAPHS accounts for factors that are known to impact patient care experience scores—including age, sex, education, language, self-reported health status, and service line—across reporting periods. Fourth, private equity acquisitions are not a random occurrence, and there may be factors that were not captured by the matching process or in our assessment of the preacquisition parallel trends that impact postacquisition outcomes. Fifth, although a quasi-experimental difference-in-differences approach was used, these findings could be impacted by unmeasured or residual confounding. Sixth, due to the COVID-19 pandemic, this study did not include data beyond 2019, and these findings could differ with the inclusion of more recent years. Seventh, not all private equity transactions may have the same impact on patient care experience and understanding heterogeneity in these transactions is an important area for future research.
Conclusions
In this national study, global measures of patient care experience worsened after private equity acquisition of US hospitals. Improving patient-centered care is a major policy priority, and these findings raise concerns about the implications of private equity acquisitions on patient care experience at US hospitals.
eFigure 1. Flowchart of Hospital Participants
eFigure 2. Map of Private Equity Acquisitions of Acute Care US Hospitals from 2010-2017
eFigure 3. Trends in Processes of Care, Communication, and Hospital Environment Measures Before and After Private Equity Acquisition (Box and Whisker Plots)
eFigure 4. Trends in Patient’s Overall Rating of Hospitals Before and After Private Equity Acquisition
eTable 1. Annual Response Rates in the HCAHPS Survey
eTable 2. Individual HCAHPS Survey Questions
eTable 3. Statistical Testing for Parallel (Pre-Private Equity Acquisition) Trends
eTable 4. Number of Hospitals by Year of Acquisition
eTable 5. Differential Changes in Patient Care Experience Measures After Private Equity Acquisition of US Hospitals (Excluding the Year of Acquisition and 1 Year Following Acquisition)
eTable 6. Differential Changes in Patient Care Experience Measures After Private Equity Acquisition Among US Hospitals with 3 Years of Pre-Acquisition and 3 Years of Post-Acquisition Data
eTable 7. Interrupted Time Series Analysis
Data Sharing Statement
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Associated Data
This section collects any data citations, data availability statements, or supplementary materials included in this article.
Supplementary Materials
eFigure 1. Flowchart of Hospital Participants
eFigure 2. Map of Private Equity Acquisitions of Acute Care US Hospitals from 2010-2017
eFigure 3. Trends in Processes of Care, Communication, and Hospital Environment Measures Before and After Private Equity Acquisition (Box and Whisker Plots)
eFigure 4. Trends in Patient’s Overall Rating of Hospitals Before and After Private Equity Acquisition
eTable 1. Annual Response Rates in the HCAHPS Survey
eTable 2. Individual HCAHPS Survey Questions
eTable 3. Statistical Testing for Parallel (Pre-Private Equity Acquisition) Trends
eTable 4. Number of Hospitals by Year of Acquisition
eTable 5. Differential Changes in Patient Care Experience Measures After Private Equity Acquisition of US Hospitals (Excluding the Year of Acquisition and 1 Year Following Acquisition)
eTable 6. Differential Changes in Patient Care Experience Measures After Private Equity Acquisition Among US Hospitals with 3 Years of Pre-Acquisition and 3 Years of Post-Acquisition Data
eTable 7. Interrupted Time Series Analysis
Data Sharing Statement
