iTechGuides is reader-supported. When you buy through links on our site, we may earn an affiliate commission. As an Amazon Associate I earn from qualifying purchases. Learn more
Private equity (PE) ownership is most consistently associated, in published studies, with higher costs to patients or payers. Quality findings are mixed to harmful, and some studies link PE ownership to lower nurse staffing or a lower nursing skill mix, meaning a smaller share of more highly credentialed nursing staff. These are associations, and they differ by setting. They do not show that every PE-owned provider raises prices, cuts staff, or delivers worse care.
What the broadest review found
The most comprehensive synthesis is a systematic review by Borsa et al., published in The BMJ on 19 July 2023. It searched five academic databases and included 55 empirical studies from eight countries. Forty-seven of those studies analyzed US operators, and the authors flagged both the risk of bias in the included studies and the US concentration of the evidence as limits on how far the findings generalize.
Nursing homes were the most-studied setting, with 17 studies. Hospitals and dermatology each had nine. The remaining studies cover other specialties and services, including ophthalmology and physician groups.
Free tools Windows power users keep installed
One-click scans. No signup required.
The authors’ overall conclusion reads:
“Such ownership is often associated with harmful impacts on costs to patients or payers and mixed to harmful impacts on quality.”
#1 Best Overall
Costs to patients, payers, and operators
The most consistent pattern in the review concerns costs to patients or payers: what patients pay, and what insurers and government programs spend. Costs to the operator are a different question, and the review could not answer it firmly. A rise in payer spending says nothing about an owner’s own expenses, and the reverse is also true, so the measures are kept apart below.
| Cost measure | Who bears it | What the evidence shows | Qualification |
|---|---|---|---|
| Costs to patients or payers, across the review | Patients, insurers, and public payers | Most consistent association with PE ownership (Borsa et al., The BMJ, 2023) | Drawn from studies with different settings and designs; the review did not produce a single pooled estimate |
| Medicare costs per long-stay nursing-home resident | Medicare | Quarterly costs rose 3.9%, or $270.37 in the study estimate, equivalent to $1,081 per resident annually (JAMA Health Forum cohort, 2021) | Study-specific estimate for 2012 to 2018, comparing PE-acquired homes with other for-profit homes |
| Commercial prices for physician services | Commercial payers | Some evidence of higher prices (GAO, 2025) | GAO found limited research in this area |
| Operator costs | The owner or operator | Too few studies for a firm interpretation (Borsa et al., 2023) | Not established by the evidence reviewed |
Nursing homes: the most-studied setting
Nursing homes are the largest group in the review, and the most specific numbers in the evidence come from a single nursing-home cohort. The 2021 JAMA Health Forum study, “Association of Private Equity Investment in US Nursing Homes With the Quality and Cost of Care for Long-Stay Residents,” followed long-stay residents of 302 US nursing homes acquired by private equity and compared them with residents of 9,562 other for-profit homes, using data from 2012 through 2018. It used a difference-in-differences design, which compares the change over time in acquired homes with the change in comparison homes rather than comparing outcome levels alone. The cohort ends in 2018, so it says nothing about acquisitions after that period.
What rose after acquisition
- Ambulatory-care-sensitive emergency department visits: a relative increase of 11.1% (1.7 percentage points). These are visits for conditions that timely outpatient care can often prevent.
- Hospitalizations: a relative increase of 8.7% (1.0 percentage point).
- Medicare costs: quarterly costs rose 3.9%, or $270.37 in the study estimate, equivalent to $1,081 per resident per year.
The acquisition group contained 9,632 residents and the comparison group contained 249,771. These are associations observed in that population and period. They are not a forecast for every nursing home or every PE transaction.
What did not show a significant association
The same study found no significant association between acquisition and antipsychotic use, severe pain, or pressure ulcers. A non-significant result means the study did not detect a link for those measures; it does not prove those outcomes were unchanged.
Staffing and skill mix
Some studies associate PE ownership with reduced nurse staffing levels or a shift toward lower nursing skill mix. The review also reports some findings of reduced staffing per patient and of shifts toward less expensive clinicians, a broader category that is not limited to nursing.
The association is not universal across operators, and staffing and skill mix were not comprehensively measured in every setting. When a study reports a staffing change, check which measure it used:
- Total staffing hours
- Staff per patient
- Registered-nurse levels
- Skill mix, meaning the share of higher- and lower-credentialed staff
These measures can move in different directions, so a finding on one does not establish the others.
Recommended Free Tools
Physician practices and specialty care
Evidence on physician practices is thinner than the nursing-home evidence. The US Government Accountability Office (GAO), in its September 2025 report Health Care Consolidation: Published Estimates of the Extent and Effects of Physician Consolidation, put private equity ownership of or investment in physician practices at about 6.5% of US physicians in 2024. Its wording reads:
“Private equity ownership of or investment in physician practices represents a small but growing share of physicians nationally—about 6.5 percent in 2024—but shares varied by specialty and geographic market, according to studies GAO reviewed.”
GAO found limited research on PE effects in physician practices and some evidence of higher commercial prices. It did not identify rigorous studies of PE effects on quality or access, so questions about appointment availability and access to services remain open.
Keep hospital-system consolidation separate
GAO also reported that at least 47% of physicians were employed by or affiliated with hospital systems in 2024, up from under 30% in 2012. That is a trend in hospital-system consolidation, not a PE ownership statistic. The same report cites increased spending and prices associated with hospital-physician consolidation, but that is not automatically evidence about PE ownership.
What’s actually slowing this PC down?
Pick the symptom - the matching free tool is one click away.
Patient care and quality
Quality is the hardest outcome to summarize because studies measure it in different ways: utilization such as emergency visits and hospitalizations, health outcomes, patient experience, inspection results, and specialty-specific measures. The review found harmful, beneficial, mixed, and neutral results across studies. Harmful or mixed findings were more common than beneficial ones, and no consistently beneficial pattern emerged. Health outcomes themselves had too few studies for a firm interpretation.
Rank #4
Hospitals and dermatology each had nine studies in the review, but the review’s overall summary does not state a setting-specific direction for either one. Check the individual studies before drawing a conclusion about a particular specialty.
In the nursing-home cohort, the rises in ambulatory-care-sensitive emergency visits and hospitalizations are indirect signals of care quality rather than direct measures of how residents were treated. Which outcome a study chooses to measure matters as much as the direction it reports.
Why effects may occur
A rise in a measured outcome is a finding about that outcome; why it rose is a separate question. The literature discusses several possible pathways. These are hypotheses or documented organizational arrangements, not one proven mechanism:
The Tool Desk
Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →Outbyte PC Repair FREEClear out junk files and repair common Windows errorsFree Scan →- Operating changes made after an acquisition, including changes to the mix of services offered.
- Staffing and skill-mix decisions, which may change the care delivered per patient.
- Negotiated payment rates with payers, which bear on the cost findings above.
- Debt taken on to finance a transaction or operations, which may add financial pressure.
- Sale-leasebacks, in which an operator sells property it owns and leases it back, creating an ongoing rent obligation.
- Ownership structures with separate operating, management, or property entities, which can divide who runs a facility from who owns the building.
The nursing-home cohort article presents arguments on both sides. Resource constraints and financial pressure could harm care, while management, technology, or compliance improvements could in principle help it. The study itself notes that earlier findings were inconsistent. The cited studies do not establish which pathway operates, and they do not measure how these ownership structures change outcomes.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Counting PE ownership is harder than it looks
Prevalence figures depend on how owners are identified. GAO’s 2023 report Nursing Homes: Limitations of Using CMS Data to Identify Private Equity and Other Ownership found that CMS ownership data in some cases did not list all owners and did not readily identify PE firms. GAO therefore supplemented CMS data with other sources and estimated that 5% of Medicare-enrolled nursing homes had private equity owners in 2022. Present that figure as an estimate with a known measurement limit.
CMS counts measure something different. In a November 2023 announcement, the Centers for Medicare & Medicaid Services reported that 348 hospitals and 3,000 nursing homes changed ownership between 2016 and 2021. Those are ownership changes of any kind, not counts of PE purchases.
The same CMS announcement, published 15 November 2023, described a final rule requiring Medicare- or Medicaid-enrolled nursing homes to disclose more information about owners, operators, management, financial-control entities, and certain property lessors, with the additional data to be made public. The announcement describes the rule and its purpose. It does not show how completely those disclosures are in place today, so ownership records should be checked against current CMS disclosure data before being treated as complete.
How to read a claim about PE and health care
Use these questions to test any headline or study summary:
Quick Recap
- Which setting? Nursing home, hospital, physician practice, or specialty clinic. Findings do not transfer automatically between them.
- Whose cost? Patient, payer, Medicare, commercial price, or operator expense. Each answers a different question.
- Compared with what? A comparison with other for-profit owners answers a different question from one with nonprofit or government owners, and the comparison group determines how much weight an estimate can bear.
- Which staffing measure? Total hours, staff per patient, registered-nurse levels, or skill mix.
- Which ownership count? PE ownership, hospital-system affiliation, or any ownership change. These are not interchangeable.
- What verb? “Associated with” describes a pattern. “Caused by” requires a design that supports causal inference, which the cited studies do not claim.
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
