Private Equity - Healthcare Edition

[MontuckyFried]

Because it's profit-run as opposed to single-payer, like it should be. And it *can* be changed, but people will need to vote for it, instead of being distracted by who is using which bathroom.

How can it possibly be changed (as you envision) when the SAME consulting firms behind all the same corporate nonsense are ALSO heavily involved in DC. It's no coincidence they have a beautiful office building right there at 19th street. https://www.mckinsey.com/us/washington-dc
It's kind of depressing to know just how many layers there are to all this. It's from Washington to PE firms and everywhere in-between. As we've talked about at length before, I would love to have proper socialized healthcare, but I'm not sure how we could ever pull it off so long as groups like McKinsey & Company et al exist. Just look them up if you're not aware. Please. They are behind Philip Morris AND healthcare. They make sure they take part in the problems such as their involvement with Purdue Pharma (see: opioid crisis) AND the solutions (major healthcare clients). It's completely insane when you take a quick look behind the curtain. And with DC in their back pocket (with lobbying AND as client)? ....Faaaaaaak. And they are far from the only players. Just one of the most well known.

[skaredshtles]

How can it possibly be changed (as you envision) when the SAME consulting firms behind all the same corporate nonsense are ALSO heavily involved in DC. It's no coincidence they have a beautiful office building right there at 19th street. https://www.mckinsey.com/us/washington-dc
It's kind of depressing to know just how many layers there are to all this. It's from Washington to PE firms and everywhere in-between. As we've talked about at length before, I would love to have proper socialized healthcare, but I'm not sure how we could ever pull it off so long as groups like McKinsey & Company et al exist. Just look them up if you're not aware. Please. They are behind Philip Morris AND healthcare. They make sure they take part in the problems such as their involvement with Purdue Pharma (see: opioid crisis) AND the solutions (major healthcare clients). It's completely insane when you take a quick look behind the curtain. And with DC in their back pocket (with lobbying AND as client)? ....Faaaaaaak. And they are far from the only players. Just one of the most well known.

I can assure you that throwing your hands up and claiming defeat won't get anything accomplished.

[MontuckyFried]

I can assure you that throwing your hands up and claiming defeat won't get anything accomplished.

Call me a cynic but am I wrong about the aforementioned relationships? I'll admit, it makes me HIGHLY skeptical we will ever get meaningful change, no matter HOW we vote. So, yeah. Until you can tell me how we can address these shenanigans going on at their cores, I do have to kind of throw my hands up in defeat. A depressing feeling for sure as I admire much about a few countries' far superior and more efficient healthcare systems, but I just can't see our politicians doing it THAT way. And baby steps ain't gonna cut it. Going to take nuking it all from orbit, beheading the remains. But we all know McKinney et al ain't ever gonna let that happen. Have you seen all these DC douchebags hobnobbing at the yacht and asst country clubs. They're all in on it. These consultants, pharma bros, insurance companies are all in the business of greed. And business is BOOMING! Sorry to break it to you brother, but they ain't about to let that gravy train go any time soon.

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[Meadow Skipper]

Nice to see I’m not the only commie here.

[rod9301]

And there are two intermediaries between doctors and Medicare, and they both make profits.

Medical care and higher education are the two worst problems in the US

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[TBS]

This isn’t new, and is not confined to a small number of industries. It’s a universal playbook across virtually every sector:

(1) buy up small businesses in a given sector (health care, plumbing contractors, resort real estate, yada^3), in lots of cases to provide liquidity to retiring principals. Finance purchases with lots of debt.

(2) install management with experience in scaling businesses; give them 10% in options. Provide another 10% for other employees

(3) combine all internally facing functions (finance, marketing, HR, purchasing, yada^3) under one umbrella

(4) ruthlessly sell non-core assets. Work out sale/leasebacks for land/buildings. Use proceeds to pay down debt/return to shareholders as dividends

(5) ruthlessly reduce staff levels. Use consolidated purchasing leverage to reduce costs. Use savings to pay down debt/reduce basis in equity.

Return to (1) and repeat.

If management succeeds they sell this business to a bigger business in a similar or adjacent sector.
If they fail, they leave a smoldering hulk for the lenders to clean up, because they got most of their investment out before the meltdown

[MagnificentUnicorn]

Because it's profit-run as opposed to single-payer, like it should be. And it *can* be changed, but people will need to vote for it, instead of being distracted by who is using which bathroom.

I don’t think single payer is the answer. HCFA should be expanded and the insurance industry should be heavily regulated. Premiums, fees and reimbursement should be set and non negotiable nationwide. This should be done by HCFA and then insurance companies can fight for members and provide value added benefits. The private insurers will have to compete and get creative to attract new members, they’ll still make money.


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[skaredshtles]

I don’t think single payer is the answer. HCFA should be expanded and the insurance industry should be heavily regulated. Premiums, fees and reimbursement should be set and non negotiable nationwide. This should be done by HCFA and then insurance companies can fight for members and provide value added benefits. The private insurers will have to compete and get creative to attract new members, they’ll still make money.

That sounds kind of like the French system? I'd be OK with that.

[DBdude]

moi aussi

[MagnificentUnicorn]

That sounds kind of like the French system? I'd be OK with that.

Exactly, their system is more privatized than ours but costs less and is more efficient. I’ll add that we need a national EMR, like the French “Card Vitale”.


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[DBdude]

it's my understanding clinicians don't make near as much money as here, and well in the french system when your time is up, your time is up... (somebody I respect who spent a lot of time there in the past decades - take it as you will)

[MagnificentUnicorn]

So what if they make less. More physicians are wanting shift work, even specialists. That means they’re going to be paid less and continuity of care will suffer. It’s heading that way here. Most physicians are overpaid and they’re assuming less responsibility and work load with the widespread adoption of mid level practitioners.


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[Conundrum]

This isn’t new, and is not confined to a small number of industries. It’s a universal playbook across virtually every sector:

(1) buy up small businesses in a given sector (health care, plumbing contractors, resort real estate, yada^3), in lots of cases to provide liquidity to retiring principals. Finance purchases with lots of debt.

(2) install management with experience in scaling businesses; give them 10% in options. Provide another 10% for other employees

(3) combine all internally facing functions (finance, marketing, HR, purchasing, yada^3) under one umbrella

(4) ruthlessly sell non-core assets. Work out sale/leasebacks for land/buildings. Use proceeds to pay down debt/return to shareholders as dividends

(5) ruthlessly reduce staff levels. Use consolidated purchasing leverage to reduce costs. Use savings to pay down debt/reduce basis in equity.

Return to (1) and repeat.

If management succeeds they sell this business to a bigger business in a similar or adjacent sector.
If they fail, they leave a smoldering hulk for the lenders to clean up, because they got most of their investment out before the meltdown

Just want this captured because it's spot on. One thing I like to see is more ESOPs as perpetuation of a business while allowing the owners to retire. And I'm seeing more of it. Good owners that recognize their employees helped build their riches are rewarding those employees. Instead of renting their time , the owners are granting equity and hopefully securing future retirement if the employees keep the business going. Vs PE and TBS is close on the numbers. The large PE funded co I work for has about 25% ownership to the employees. We don't see the split but it's pretty heavy to exec level.

[rod9301]

it's my understanding clinicians don't make near as much money as here, and well in the french system when your time is up, your time is up... (somebody I respect who spent a lot of time there in the past decades - take it as you will)

A big difference is the overhead.
In France, the medical practice i go to, 10 Doctors, 1 admin, who's also a receptionist.

In Truckee, same size, at least 5 admin.

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[DBdude]

as part of the party, there are a lot of people drinking from the healthcare fountain. compensation of doctors is problematic... from family providers and oby gyn making little to specialists making gob smacking amounts of dough

and of course there is the admin side

the highest paid public employee in many states is not the football coach but the head of blue cross

[MagnificentUnicorn]

BCBS is a private corporation is it not.

A lot of specialists have reduced themselves to being technicians, there’s not really any semblance to a medical practice.


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[Conundrum]

Blue Cross heads are not public employees. Tax dollars don't pay them, your premium does.

[DBdude]

umm, most of them are not for profits and government is obviously a not for profit... that is what I meant by public employee

furthermore, the not for profits in healthcare, that I have worked for explicitly were set up for the public good

let the hair splitting commence by the "experts"

after some thought, they don't pay fucking income tax, and probably don't pay property tax, so if a Blue is a not for profit, I should fucking hope they are in business for the public good.... so maybe they are public employees in the truest sense of the words

[Conundrum]

My "expert" opinion is that if you're going to say non-profits are public employees, churches are non-profits and I thought there was clear delineation of church and state.

[DBdude]

fuck you - is a football coach at a university a public employee because a state university is a not for profit? it's not state government - it's not.

tedious cunt

[Conundrum]

fuck you - is a football coach at a university a public employee because a state university is a not for profit? it's not state government - it's not.

tedious cunt

Nobody can say you lack passion on the topic.

https://finance.yahoo.com/news/highe...120019764.html

The highest-paid public employee in the vast majority of American states is a college football or, less frequently, a college basketball coach -- and your tax dollars fund their hefty paychecks.

I didn't write the article. I can see what you're saying and agree that BCBS should be considered public employees servicing the public as part of their non-profit status but I live in the real world where this is not the case. And that is a bummer.

[DBdude]

ugggh paying health insurance really is a tax. yes, it is not the formal definition of a tax imposed by government, but in many ways, it really is a tax

[Conundrum]

Unless you grow your own, one could argue that buying food is a more necessary than buying health insurance. Also a tax? Yes, I'm a tedious cunt.

PS-I agree that more intervention is needed in healthcare and really, a single payer system is most likely the best fix. The largest payer of claims in the US is a single payer system by the way. You just need to be old enough to access it. Their reimbursement rates to providers is lower than any private (non-profit or for-profit) payer by a decent margin. Weird the negotiation powers of the the federal gov... Why do you think AMA and others (pharma, PE, etc) lobby so hard against single payer? Their job is to deliver care. Greed has been a problem since humans have been around.

[DBdude]

yeah you are

starving to death is not the same as not having insurance

to you it may be... that would be sad

[DBdude]

taxes fund services for the public good. in many places taxes cover healthcare. in our country they do not unless of course you are on medicare, medicaide, or a public employee.

the largest healthcare payer in the united states is the federal government. if you were to use a more expansive term like "government" it would be higher