Hospitals Acquired By Private Equity Firms: Increased Postoperative Mortality For Common Inpatient Surgeries

Private equity (PE) firms have increasingly invested in US hospitals, raising concerns about their effects on the quality of surgical care. We evaluated the impact of PE acquisition of acute care hospitals on outcomes from four common general surgical operations among Medicare beneficiaries, using a difference-in-differences approach. Our study included 67 hospitals acquired by PE and 634 control hospitals not acquired by or previously owned by PE. We found that PE acquisition was associated with a 2.7-percentage-point increase in thirty-day postoperative mortality compared with control hospitals, driven primarily by an increase in failure to rescue (3.9 percentage points), with no observed change in the rate of complications. Subset analysis revealed that the increase in mortality was particularly pronounced for unplanned (emergent) surgeries, whereas no significant changes were observed for planned (elective) surgeries. Our findings suggest that PE acquisition may adversely affect the management of emergent surgical cases, raising critical considerations for policy makers and health care stakeholders regarding the influence of PE ownership on patient safety.