In the September/October 2008 issue of Health Affairs, HCP faculty members David G. Stevenson, SM, PhD and David C. Grabowski, PhD, published the article Private Equity Investment and Nursing Home Care: Is It a Big Deal? The article builds on previous work by Stevenson and Grabowski, including a recent article in Health Services Research and a recent report for the federal government on nursing home corporate restructuring. The topic has been high on the policy agenda since a September 2007 front-page article in the New York Times detailed private equity purchases of nursing homes and subsequent declines in resident care.  

Based on a review of transactions involving 1,500 facilities purchased by private equity companies since 2000, Stevenson and Grabowski “found little evidence to suggest that nursing home quality worsens significantly following purchase by private equity companies.” In fact, some resident outcomes such as catheter use, urinary tract infections, weight loss, and pressure ulcers improved. This paper is the first comprehensive analysis of these transactions and is an early snapshot of what has happened after these deals. In future work, Stevenson and Grabowski emphasize that it will be important for researchers and policymakers to consider issues beyond private equity ownership and its longer-term impact, including broader issues around transparency of ownership and accountability for resident care.  

Read the HMS press release about this study.