How low can private equity go?
Private equity firms consolidating homes for disabled – msn/WaPost
“Private equity firms have been buying up scores of companies that care for people with intellectual and developmental disabilities, according to a new report by an advocacy group that warns that the surge of investment in an industry that has traditionally been nonprofit could result in investors’ demands coming before the needs of their vulnerable clients.
“The report from the Private Equity Stakeholders Project, a nonprofit watchdog group, said that over the past decade the firms have been bundling smaller group homes and service providers into very large outfits spanning multiple states. Alpine Investors has amassed a home care services company with 100,000 employees, according to the report; working together, two other private equity firms, Centerbridge Partners and Vistria Group, have built two firms with 61,000 and 45,000 workers.
“Many such services for people with intellectual disabilities — residential care, home health and personal assistance — were historically provided by nonprofits, some of them religious organizations. They are most commonly funded by Medicaid payments. The report notes that some of the companies built by private equity firms have been cited for repeated deficiencies in patient care since the purchase.”