Recent Policy and Regulatory Initiatives to Address Private Equity’s Negative Impacts in Healthcare

The report examines a range of legislative and regulatory efforts to address private equity's role in the US healthcare system, highlighting a shift toward increased oversight of mergers and acquisitions at the state level. It details successful laws in Illinois, Indiana, New Mexico, and New York, while noting failures in states like California and Massachusetts. Federally, it discusses proposed acts to penalize corporate looting and increase transparency, alongside CMS rules on staffing and spending. The document also tracks antitrust and fraud enforcement actions and concludes with policy recommendations to curb financialization through stricter transparency, debt limits, and joint liability.

• Several US states have passed laws to increase oversight of healthcare mergers and acquisitions. Illinois' HB 2222 requires notice to the Attorney General 30 days before transactions; Indiana's law requires 90 days' notice for transactions involving entities with assets of $10 million or more; New Mexico passed a temporary bill (Senate Bill 15) giving the Office of Superintendent of Insurance oversight over hospital ownership changes; and New York requires 30 days' notice for material transactions involving physician practices that increase in-state revenues by $25 million or more.
• Legislative efforts to regulate private equity in healthcare failed or were vetoed in several states during 2024. In California, Governor Newsom vetoed AB 3129, which would have required 90-day advance notice for acquisitions and prohibited private equity from directing physician practices. Massachusetts failed to reconcile House and Senate bills that would have banned the sale of hospital real estate to real estate investment trusts (REITs).
• Two comprehensive federal bills were introduced in 2024 targeting private equity abuses. The Corporate Crimes Against Healthcare Act proposes criminal penalties of up to 6 years in prison for executives whose looting of healthcare entities results in patient death. The Health Over Wealth Act would require private equity firms to obtain a license from the Department of Health and Human Services (HHS) to invest in healthcare and set up escrow accounts to cover five years of operation and capital expenses.
• The Centers for Medicare & Medicaid Services (CMS) implemented rules to improve care and transparency. A final rule issued April 22, 2024, established minimum nurse staffing standards of 3.48 hours per resident day (HPRD) for long-term care facilities. Another rule requires that at least 80% of Medicaid payments for personal care, homemaker, and home health aide services be spent on direct care workforce compensation.
• The US government has pursued enforcement actions against private equity-owned healthcare firms for fraud and antitrust violations. The Private Equity Stakeholder Project tracked seven Medicaid/Medicare fraud settlements in the past year, including a $27 million settlement by Precision Toxicology and a $19.4 million settlement by Gentiva. In antitrust cases, the Colorado Attorney General required U.S. Anesthesia Partners (USAP) to divest exclusive contracts at five hospitals and pay $200,000.
• The No Surprises Act, effective January 1, 2022, has been challenged by the high volume of claims from private equity-owned companies. In the first half of 2023, four private equity-owned companies initiated 191,785 disputes, representing 70% of the 274,432 total claims filed in the Independent Dispute Resolution (IDR) process.
• The US Senate has launched several investigations into private equity's impact on healthcare, including a bipartisan probe into hospital ownership and specific scrutiny of the Steward Health Care bankruptcy. The latter involved hearings on how management decisions impacted patient care and a contempt charge referral for CEO Ralph de la Torre for ignoring a congressional subpoena.

APA

Bugbee, M., Fenne, M., & Noble, C. (2024). Recent Policy and Regulatory Initiatives to Address Private Equity’s Negative Impacts in Healthcare. Private Equity Stakeholder Project. https://pestakeholder.org/wp-content/uploads/2025/01/PESP_Report_Healthcare-Policy_2024-compressed.pdf

Chicago

Bugbee, Mary, Michael Fenne, and Chris Noble. Recent Policy and Regulatory Initiatives to Address Private Equity’s Negative Impacts in Healthcare. Private Equity Stakeholder Project, 2024. https://pestakeholder.org/wp-content/uploads/2025/01/PESP_Report_Healthcare-Policy_2024-compressed.pdf.

Wikipedia

{{cite report |last1=Bugbee |first1=Mary |last2=Fenne |first2=Michael |last3=Noble |first3=Chris |title=Recent Policy and Regulatory Initiatives to Address Private Equity’s Negative Impacts in Healthcare |publisher=Private Equity Stakeholder Project |date=December 2024 |url=https://pestakeholder.org/wp-content/uploads/2025/01/PESP_Report_Healthcare-Policy_2024-compressed.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{bugbee2024recent, author = {Bugbee, Mary and Fenne, Michael and Noble, Chris}, title = {{Recent Policy and Regulatory Initiatives to Address Private Equity’s Negative Impacts in Healthcare}}, institution = {Private Equity Stakeholder Project}, year = {2024}, month = dec, url = {https://pestakeholder.org/wp-content/uploads/2025/01/PESP_Report_Healthcare-Policy_2024-compressed.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }