Alfredo Sanchez learned plenty in nursing school, but nothing prepared him for his first job in the trauma intensive care unit at Crozer-Chester Medical Center in Delaware County, Pennsylvania.
The EKG machine, for instance, was fickle; it had a frayed cord that had to be held just so. Then the machine finally died, and Sanchez had to get other over-stretched nurses to cover his critically ill patients while he raced around the hospital, looking for an EKG that worked. When he ran out of canisters for bodily fluids, he had to scavenge for them elsewhere in the hospital. At one point, his unit ran out of the suction tubes used to keep intubated patients’ airways clear. The water machine was laden with bacteria, and all the nurses knew not to use it. The staff continually raised these problems to management, to no avail.
Sanchez, 42, who worked at Crozer-Chester in 2024 after serving in the Army for 20 years, was a paramedic before he became a nurse. In the ICU he took care of people with gunshot wounds, people who had been in life-threatening car accidents, people who had just had major surgery. But as staffing and supply budgets were cut to the bone, he feared for his patients’ survival.
On one shift, a patient who had been shot in the head had to share their nurse with two other critical patients. Another day, a patient needed a common medication to prevent an impending stroke. But when Sanchez went to the dispensing system, that medication was missing. He hustled to another floor—they were out, too.
“You start to panic,” Sanchez said. He finally found the medication on a third floor. When he asked the hospital’s pharmacy what was behind the shortages, he discovered that the department had been cut so much that one person was doing the job previously done by three people.
“The majority of our patients were not wealthy. Many of them were minorities,” Sanchez said. “The injustice of it. It feels like a war zone. The public doesn’t know what’s behind the curtain. It’s a hospital. You wouldn’t know that the EKG machine is broken, that they’re missing supplies or that they are going to really struggle to have the right staffing for you.”
Of all the things he learned on the fly, Sanchez said, the most important was this: “When I took the job, I had no idea what private equity was.”
From 2010 until 2021, Crozer-Chester Medical Center was owned by Prospect Medical Holdings, a company which was in turn majority-owned by Leonard Green & Partners, a private equity firm. Experts say that the ownership group extracted hundreds of millions of dollars from Prospect Medical, which owned not only Crozer-Chester but multiple safety-net hospitals in five states. Leonard Green and Prospect Medical did this by loading the hospitals up with debt.
When Leonard Green exited Prospect Medical in 2021, the Rhode Island attorney general investigated and found that the ownership group “realized hundreds of millions of dollars and would leave behind a system that is highly leveraged, that is, where liabilities greatly exceed assets.” Prospect Medical continued to own Crozer-Chester until the company closed that hospital and others amid the company’s bankruptcy in 2025, leaving residents with nowhere to go for care.
What Sanchez experienced was Crozer-Chester’s death throes. What he saw shocked him deeply, but it was not unusual: a hospital filled with clinicians doing everything they can to keep vulnerable patients safe while being starved of resources, as investors walk away with the money. This, experts say, often happens during or in the aftermath of private equity ownership.
A spokesperson for Leonard Green disputed this characterization and said that at the time of their exit, “Prospect was in strong financial condition with access to over $500 million of liquidity available to continue to fund operations, invest in improving hospitals, and provide quality care to its patients, and was at no risk of financial failure.” Prospect Medical Holdings did not respond to a request for comment.
For roughly the past 20 years, private equity firms have been on a buying spree of health care businesses, like hospitals, surgical centers, physician practices, nursing homes, rehabilitation facilities and hospices. According to the nonprofit Private Equity Stakeholder Project, which uses Centers for Medicare and Medicaid data, about 488 U.S. hospitals are currently owned by private equity, more than 22 percent of all for-profit hospitals. A study in Health Affairs found that the number of private equity–controlled physician practices increased from 816 in 2012 to 5,779 in 2021.
Because private equity acquisitions are not always transparent, and because our health care system is decentralized and fragmented, researchers and regulators have only recently quantified the full cost of this immense and ongoing shift.
What they’ve found is frightening. A 2023 study in the Journal of the American Medical Association compared private-equity held hospitals with other for-profit hospitals and found a 25 percent increase in preventable adverse events at private equity hospitals—like a 38 percent increase in central line bloodstream infections and doubling of surgical site infections. A 2025 study in the Annals of Internal Medicine found that when private equity bought a hospital it tended to cut staffing and salaries; there was a corresponding 13 percent increase in emergency room deaths.
A 2023 paper in The Review of Financial Studies compared private equity–owned nursing homes to other nursing homes, the kind that offer short-term rehab for people who need to, say, recover from surgery—not facilities for long-term or end-of-life care. The researchers discovered that after private equity acquisition, deaths increased by 11 percent. The researchers wrote that this “implies that about 22,500 additional deaths occurred due to PE ownership over the 12-year sample period.”
Dr. Atul Gupta is an economist at Wharton and a lead researcher on that paper. He was so alarmed that he second-guessed his own data. “To detect an effect of this size is unusual. We spent a lot of time trying to double check it, triple check it. Our first reaction was that this is probably a mistake.” It wasn’t.
This data is underlined by horrifying anecdotes that are trickling out of hearings and investigations, like one by The Boston Globe that revealed that a woman died of internal bleeding after giving birth at St. Elizabeth’s Medical Center in Brighton, Massachusetts—which was then owned by Dallas-based private equity firm Steward Health Care—because the hospital did not have embolism coils on hand to stop her bleeding. The supplies had been repossessed for nonpayment.
A 2024 Federal Trade Commission workshop featured the testimony of an anonymous nurse who described an emergency room so understaffed that a man being held for a psychiatric disorder was able to gouge out an elderly woman’s eye and was trying to gouge out the other before he was finally subdued. The woman died of her wounds. The nurse described the aftermath: “After that incident, ER nurses were given de-escalation training with the assumption that the handyman maintenance staff will act as security. Hiring a full-time security guard was simply too expensive.”
No one would argue that the American health care system would be just fine without private equity’s meddling, but this emerging data has made the impact of this trend more clear: It has meant the catastrophic closures of safety net hospitals in multiple states, including the one where Sanchez worked. In that case, the private equity firm–led ownership walked away with $437 million in profit, leaving the Crozer system stripped of its assets and eventually bankrupt. Private equity ownership has also led to increased health care costs, job losses, adverse outcomes and preventable deaths.
These firms are different from other companies. Unlike publicly traded corporations, they are not generally required to release quarterly earnings or disclose internal changes or all mergers and acquisitions. (They are required to disclose certain data to their investors.) Unlike small businesses—think a local restaurant chain or a plumbing guy—they are not actually in any business except buying and selling companies. They’re agnostic about what those companies actually do, whether it’s a safety-net hospital or a widget factory.
The basic model is that a private equity firm raises money and buys a company. Then the firm does everything it possibly can to make the newly acquired company more profitable. After three to seven years, the private equity firm sells the company or shuts it down. It’s a little like house flipping.
That short timeline means private equity firms are free to take risks that might make a company more profitable in the short term but doom it over the long term. To make a hospital more profitable, studies show, private equity tends to use the tactics you might expect: cut staff, salaries and budgets. Raise prices. Shut down units that don’t make very much profit, like labor and delivery.
But there are weirder, more insidious tricks: Using debt to make money is one of private equity’s favorite strategies. A private equity firm will often buy a company using, say, 80 percent loaned money and 20 percent of the fund’s investors’ money. That’s like getting a mortgage—debt—to augment a down payment to pay for a house.
But somehow, the responsibility to pay back that loan isn’t on the private equity firm. Instead, the debt is transferred onto the acquired company. The private equity firm can exit and walk away with the profits, leaving a hospital saddled with debt.
Private equity firms can also sell off a hospital’s land and buildings to a real estate company and pocket the proceeds, forcing the hospital to pay rent for its own buildings. When the private equity firm exits, the hospital is left stripped of assets and heavily in debt. Sometimes, that results in subsequent hospital bankruptcy and closure.
Private equity firms claim that they “create value,” but that value is for their investors—in fact, that’s a firm’s legal duty.
As Sanchez pointed out, it’s nearly impossible for the public to see behind the curtain. It’s not always clear what company owns a health care facility. (The Private Equity Stakeholder Project’s private equity hospital tracker seems to be the most comprehensive public accounting.) And health care professionals are often afraid that speaking out will risk their jobs and their future employment.
In this age of deregulation, can anyone do anything about it?
There’s real momentum right now to regulate private equity in health care. Senator Ed Markey introduced a federal bill that would mandate transparency, limit the ways that assets can be sold off, and require private equity firms to set up escrow accounts that could be used in case of hospital or nursing home failure. Markey said in an email that the bill is “a critical step toward curtailing corporate greed.” But with Republicans controlling all branches of government, the bill seems unlikely to get out of committee.
In 2025, states increasingly stepped in. Oregon has gone the farthest, with a 2025 bipartisan bill that bans the corporate practice of medicine, meaning that only licensed health care professionals can own a controlling share of health care businesses.
Oregon’s House Leader Ben Bowman, who introduced the bill, ascribes Oregon Republicans’ willingness to vote for the bill to the fact that rural hospitals are often vulnerable to private equity’s tactics. “Those are Republican districts. So if I were a Republican lawmaker, I would care an awful lot about this,” he said. The bill doesn’t target private equity specifically, but all corporations. “I don’t care whether your intentions are good or bad. I care whether or not the physician retains control over decision-making that impacts patients,” Bowman said.
Massachusetts also passed a bill in 2025, this one focused on transparency, requiring private equity firms to report their health care transactions to state regulators, and putting limits on selling off health care real estate. California’s new laws also increase transparency, as well as give the state’s attorney general the ability to take action against corporations interfering with medical decisions.
In Pennsylvania, which was heavily impacted by the Crozer closures, a proposed bill would ban selling off health facilities’ real estate and would give the state’s attorney general the ability to monitor and block deals that would impact the public’s access to health care. It is supported by Democratic Governor Josh Shapiro, and has passed the state Assembly, but its fate is unclear in the Republican-controlled Senate.
Representative Tarik Khan is a nurse and a sponsor of the Pennsylvania bill. “I know it sounds like the sky is falling,” he said. “But actually there are places in Pennsylvania where there is no hospital. Where if you are having a heart attack or a stroke, you cannot get to a hospital within a reasonable amount of time. People are dying.”
At a conference for private equity in health care in Manhattan this October, there was a palpable sense of frustration and resentment that private equity has gotten a bad rap—that they’ve all been painted with the same broad brush.
Dr. Eileen Appelbaum, the co-director of the Center for Economic and Policy Research, somewhat agrees. “There are 4,000 funds out there. The 300 largest are responsible for most of the bad behavior,” she said. Indeed, while many private equity firms dabble in health care, a small number account for most health care acquisitions. Apollo Global Management, for instance, owns nearly half of all private equity–held hospitals.
That’s why Appelbaum favors regulation that targets risky behaviors, like selling off a hospital’s assets, rather than private equity firms in particular. She pointed out that the big firms are way too large to work closely with health care companies to figure out sustainable ways to become more profitable. Instead, they slash and burn. But not all of them.
In Seon Hwang is the managing partner of Ascend Partners, a private equity firm that has invested in nine health care companies. One of them is Essen Healthcare, a primary, specialty, and urgent care system in the Bronx. Hwang said that Ascend helps Essen become more profitable by expanding the company’s ability to get people to come in for the preventative and routine care they are already supposed to get, and to do it within the Essen system.
“Vaccinations, elderly care, cardiovascular, cancer and diabetes screenings, these are important,” he said. He pointed out that many people don’t get that care. So, the idea is: Invest in outreach to patients, make it easy for them to come in for what they need. Simultaneously, invest in making sure Essen can provide all those services, from mammograms to diabetes care to colonoscopies, keeping money in the system. In theory, at least, this would mean that the care is more accessible and Essen becomes more profitable.
Hwang said that he could “maybe, probably” make more money if he wasn’t actually concerned with the long-term flourishing of Essen. “We will lose money in certain places and people will say, ‘Yeah, those guys are idiots.’”
Dr. Jonathan Jones is an emergency medicine physician and the immediate past president of the American Academy of Emergency Medicine. He’s used to turmoil and tough days. But he’s vowed to never work for private equity again.
One case in particular broke him. The man had the classic symptoms: slurred speech, a drooping face and weakness on one side of his body. Jones knew the man was having a stroke, and he also knew the two things the man needed: a neurologist and likely an IR thrombectomy, a procedure that removes the blood clot blocking blood flow in the brain, often reversing any damage the stroke has caused. But the straightforwardness of the case was no relief because he could offer neither.
At the time, he worked for a group practice that staffed the emergency department at one of the hospitals in Jackson, Mississippi, where Jones lives with his family. (Most emergency rooms at hospitals are staffed and managed not by the hospital directly, but by physician group practices.) Jones asked that I not name the hospital, out of fear of retaliation.
In 2018, the hospital had switched to an emergency department staffing company that was owned by private equity. After that, Jones noticed staff cuts. He went from caring for about eight patients at a time to up to 18. He dealt with it. But then he was told to accept every transfer from other hospitals, no matter what, or he’d be fired. His hospital was located in a poor part of town, where people were uninsured or had Medicaid. People transferred from other hospitals were more likely to have private insurance. “The CEO said it point blank. I wish I had it in writing. He’s smarter than that. He said, ‘The people who walk through the door don’t pay us jack shit. The transfers do.’”
“I’m having an accountant tell me how to practice my job,” he continued. “That’s a patient care decision. He knows nothing about medicine.”
Johnson felt trapped: The private equity firm owned every emergency department practice in Jackson except for two, which had no openings. Jones had a wife and a small daughter, a whole life in this city, and there was almost nowhere for him to practice without being obliged to work for the private equity firm.
Then the penny dropped, and Jones realized he would have to quit: The man with the stroke was transferred from another hospital to his emergency room.
If anyone had asked him, which they hadn’t, Jones would have told them that this man needed to go to a different hospital, one that was only five miles away and that has a comprehensive stroke center. There, the man could have seen a neurologist and gotten the procedure to bust the clot in his brain. But the policy was to accept all transfers, no matter what. And technically, Jones’s hospital had a neurology service: They had exactly one neurologist, but he did not come in on nights or weekends.
And that was how Jones found himself face-to-face with this man, realizing that in the richest country in the world, armed with all the medical knowledge he had spent so much time amassing, and with all the desire in the world to help, he could not treat this man’s stroke. In fact, he couldn’t even give him a room, because the emergency department was full. The patient was lying on a gurney in a hallway. “He just sat and sat. We controlled his blood pressure because that’s important in a stroke. And he basically received no appropriate treatment for a stroke.”
Jones has not followed up with the man. But he’s haunted by the thought that, all these years later, this man probably still has difficulty speaking, still has a droop in his face, probably walks with a cane or walker. And it’s also his best guess that if this man had been able to get a thrombectomy, that all those symptoms would have resolved and he could have resumed his normal life.
“He’s going to be disabled for the rest of his life. And the reason it happened was because of this protocol system they put in place. And it’s my name: ‘Accepted and transferred by Dr. Jonathan Jones,’” he said. “I mean, you go home and cry.”
