Who Employs Your Doctor? Increasingly, a Private Equity Firm.

In recent years, private equity firms have been gobbling up physician practices to form powerful medical groups across the country, according to a new report. The New York Times: In more than a quarter of local markets -- in places like Tucson, Ariz.; Columbus, Ohio; and Providence, R.I. -- a single private equity firm owned more than 30 percent of practices in a given specialty in 2021. In 13 percent of the markets, the firms owned groups employing more than half the local specialists. The medical groups were associated with higher prices in their respective markets, particularly when they controlled a dominant share, according to a paper by researchers at the Petris Center at the University of California, Berkeley, and the Washington Center for Equitable Growth, a progressive think tank in Washington, D.C. When a firm controlled more than 30 percent of the market, the cost of care in three specialties -- gastroenterology, dermatology, and obstetrics and gynecology -- increased by double digits. The paper, published by the American Antitrust Institute, documented substantial private equity purchases across multiple medical specialties over the last decade. Urology, ophthalmology, cardiology, oncology, radiology and orthopedics have also been major targets for such deals. "It's shocking when you look at it," said Laura Alexander, director of markets and competition policy for the Washington Center, who said private equity firms dominated only a handful of markets a decade ago. By looking at individual markets, the researchers were able to document the local impact. "National rates mask this much more acute problem in local markets," she said.

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