Private equity and healthcare firm behavior: Evidence from ambulatory surgery centers

Haizhen Lin, Elizabeth Munnich, Michael R. Richards, Christopher M. Whaley and Xiaoxi Zhao

Journal of Health Economics, 2023, vol. 91, issue C

Abstract: Healthcare firms regularly seek outside capital; yet, we have an incomplete understanding of external investor influence on provider behavior. We investigate the effects of private equity investment, divestment, and an initial public offering (IPO) on ambulatory surgery centers (ASCs). Throughput is unchanged while charges grow by up to 50% for the same service mix. Affected ASCs witness declines in privately insured cases and rely more on Medicare business. Private equity increases physician ASC ownership stakes, and both simultaneously divest when the ASC is sold. Our findings appear more consistent with private equity influencing the financing of ASCs, rather than treatment approaches.

Keywords: Ambulatory surgery centers; Private equity; Physician ownership; Outpatient surgery (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:91:y:2023:i:c:s0167629623000784

DOI: 10.1016/j.jhealeco.2023.102801

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