AHIP Presses Congress, White House To Ramp Up Scrutiny Of Private Equity Provider Deals

May 24, 2022

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Source: Fierce Healthcare, by Robert King

Health insurance trade group AHIP is calling for the White House and Congress to increase scrutiny of private equity control of providers, which the group worries could impact quality and costs.

The group earlier this week released letters sent to the White House and congressional leaders outlining parts of a new policy road map and priorities (PDF). Chief among them was more transparency surrounding private equity deals, which has grown in popularity across certain parts of the provider industry.

“While improving transparency of health care prices at the federal level has been a major focus, only the recent executive order related to nursing home care has applied to the activities of private equity entities of the health care marketplace, which have vastly different business models than other health care organizations,” the letter to President Joe Biden said.

AHIP wrote that there needs to be more transparency on private equity control of physician specialty groups and how the deals can impact quality and costs for patients.

The group noted in a white paper that back in 2018 private equity made up 45% of all health mergers and acquisitions. While initial deals applied to certain specialties like orthopedics and urology, AHIP said targets have expanded.

AHIP wants Congress to pass legislation that requires the public reporting of all private equity and hedge fund purchases of specialty groups and other providers such as emergency room physicians or ambulance providers. They also want the federal government to study any anticompetitive impact on the acquisition of providers by private equity firms.

Other key priorities in AHIP’s road map include:

  • * Advance use of site-neutral payments to ensure payments are the same no matter the site of care. The Centers for Medicare & Medicaid Services has cut Medicare payments in recent years to off-campus hospital clinics to bring the payments in line with those paid to physician clinics. But the effort led to a legal fight with the hospital industry.
  • * Support the expansion of home-based advance care via “value-based care and payment models,” the road map said.
  • * Remove barriers to telehealth access, which exploded in use since the onset of the pandemic; but, now, regulators are figuring out what to make permanent. AHIP wants the federal government to have network adequacy regulations to account for the availability of telehealth and to ban billing of “distant site facility fees for telehealth services.”

AHIP’s push to scrutinize private equity deals comes as the federal government has delivered more scrutiny of hospital merger deals. The Federal Trade Commission also launched a probe into physician practice acquisitions back in January 2021 to examine their impact on market competition.

 

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