Private equity (PE) dollars have become prominent in the US healthcare industry in recent decades, with PE firms now owning roughly 8% of all private hospitals in the country, according to nonprofit Private Equity Stakeholder Project.

But studies have illustrated the financial model’s potential adverse effects, such one published in JAMA in December 2023 that found PE-owned hospitals are 25.4% more likely to report patient complications. Others have found that PE-owned healthcare companies represented more than one-fifth of healthcare company bankruptcies in 2023 and that PE-owned hospitals see their assets drop an average of 24% following an acquisition.

In response, states have stepped up scrutiny of private equity’s influence on healthcare.

“Just in the last year or two, several states have amped up their efforts to increase market oversight, not just for private equity investors, but different types of consolidation activity in healthcare,” Yashaswini Singh, a healthcare economist and assistant professor of health services, policy, and practice at Brown University School of Public Health, told Healthcare Brew. “Instead of waiting for the federal government to do something, a lot of states are taking action.”

Keep reading here.—MA

Lauren Barca believes fighting health inequality often comes down to something simple—and, frankly, messy: diapers.

“Diapers have been the overlooked, silent epidemic of families in need,” she told Healthcare Brew.

Barca, VP of quality at 86Borders, a member relationship management company that works with vulnerable Medicare and Medicaid beneficiaries, led the charge to make Tennessee the first state to cover diapers under Medicaid. The program works by covering disposable diapers for babies and toddlers up to two years old enrolled in Medicaid and the Children’s Health Insurance Program. It began in August and provides parents and caregivers up to 100 diapers a month under a section 1115 demonstration waiver, which is used to test new programs that align with Medicaid’s goals, when parents show their child’s pharmacy ID card.

“Hopefully, that will drive people to also pick up other important medications for their family [and] get those necessary flu vaccines or other recommended vaccinations,” Barca said.

As of November 8, the program has served 30,321 Medicaid members.

Keep reading here.—CM

Turns out it is possible for companies to offer customers too many savings.

Retail pharmacy giant Walgreens agreed on November 4 to pay $100 million to settle a lawsuit first filed in 2017 that claimed the company had charged insured customers more for prescriptions than its Prescription Savings Club customers. Plaintiffs alleged at the time that Walgreens was artificially inflating the prices it reported to insurers.

This comes less than two months after Walgreens paid a $106.8 million settlement over allegations that the chain had improperly submitted claims to Medicare, Medicaid, and other federal health programs for prescriptions that were filled but never picked up.

It also comes as Walgreens works through a major strategy shift after a year of seeing its shares plunge 63%.

Keep reading here.—MA

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