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Report: PE-backed companies bad for patients

Report: PE-backed companies bad for patients

WASHINGTON – A new report from the Private Equity Stakeholder Project and the National Disability Rights Network highlights the toll the PE business model has had on people who rely on durable medical equipment. 

The report finds: 

  • Private equity firms have increasingly bought up DME manufacturers and suppliers and consolidated them. Through aggressive debt-funded growth strategies, a handful of private equity-owned DME companies have grown from nonexistence to industry giants over the last decade. 

  • In recent years, private equity-owned DME companies have paid millions of dollars to settle allegations of health care billing fraud. 

  • Private equity-owned DME companies have fought recent legislative efforts that seek to expand consumers’ ability to repair their own wheelchairs, respirators and other critical pieces of equipment. 

“As private equity firms continue to buy medical equipment manufacturers and suppliers, they have sought to cut costs to maximize outsized returns,” said Eileen O’Grady, health care director at PESP. “We have found these typical PE business practices result in quick profits for the firms, often at the expense of patients. People reliant on DME have seen their local DME shops gobbled up by corporate chains, faced fraudulent billing practices and struggled to access repairs. Several private equity-owned DME suppliers have challenged right-to-repair legislation, exacerbating delays in accessing repairs for the equipment essential to their daily lives.” 

The report makes several policy recommendations, including enforcing timely repair requirements, investigating allegations of widespread fraud, limiting industry consolidation, and eliminating prior authorization for necessary repairs of DME. 

It also contains case studies of multiple companies and their involvement in the DME industry, personal stories of wheelchair users and a comprehensive list of DME companies currently owned by private equity firms. 

You can view the report here:


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