In recent years, private equity firms have taken center stage in various industries, including healthcare and housing, prompting concerns about their influence on patient care and rising housing costs. A new research analysis called the Private Equity State Risk Index sheds light on the extent of private equity's involvement in these crucial sectors across all 50 states.

Private equity firms have increasingly turned their attention to the healthcare industry, with over $1 trillion spent on acquiring healthcare companies nationwide in the past decade. These firms typically burden the acquired entities with debt, aiming to sell them at a profit within three to five years. However, critics argue that the pursuit of profit conflicts with diligent patient care.

Nursing homes, hospitals, physician practices, and healthcare staffing companies have become key targets for private equity acquisitions. Reports suggest that private equity ownership of these facilities can have adverse effects on patient outcomes. Studies have shown higher death rates among nursing home residents under private equity ownership, while patients at private equity-owned hospitals face a higher number of adverse events, such as falls and infections.

One of the examples is Conemaugh Health System, a hospital chain in west central Pennsylvania, which was once a nonprofit entity serving local communities. It is now a for-profit system owned, in part, by Apollo Global Management, one of the largest private equity firms in the United States. This change in ownership has raised concerns among patients about the impact on the quality of care.

Interestingly, private equity firms' involvement in various industries can be extensive, but often goes unnoticed by consumers. Reports indicate that private equity firms own a significant portion of emergency departments across the nation. Furthermore, projections suggest that by 2030, private equity-backed companies may own 40% of the nation's single-family homes, driving up housing costs for local renters.

The Private Equity State Risk Index, developed by the Private Equity Stakeholder Project, provides a comprehensive analysis of private equity's presence in key economic areas: healthcare, housing, jobs, and pensions. It aims to empower consumers, legislators, and regulators in identifying and understanding the dominance of private equity in different states.

Although the American Investment Council, the lobbying organization for the private equity industry, states that their acquisitions improve the sectors they invest in, independent academic research has drawn attention to potential harm caused by private equity ownership. The potential negative impact on patient care, as well as rising housing costs, have fueled calls for greater transparency and regulation of the industry.

Legislators, including Senator Elizabeth Warren, have expressed support for the Private Equity Stakeholder Project's state risk index as a tool to hold private equity accountable for its actions. As the scrutiny intensifies, it remains to be seen whether increased awareness and oversight will lead to significant changes in the private equity landscape, ultimately prioritizing the well-being of patients and housing affordability for communities across the nation.