PE bought your hospital? More like, "some guys" bought your hospital.
Ask why "some guys" bought it instead of using their money in the market, or why your hospital sold in the first place. As anyone who's company has been purchased by private equity knows, it's probably because your hospital wasn't doing so hot to begin with and "some guys" were willing to gamble that they could turn it around and make some money before it blew up. This will mean turning the screws on the customers and employees and creating a sucky environment. But this is just accelerating what was likely already an inevitable decline.
As with any risky investment, there's a solid chance the PE firm will lose money on the gamble.
Hospitals, in many cases, are not good businesses. Especially in places where doctors, nurses, and other staff can demand a premium based on their local market's dearth of professionals. PE firms in my opinion are part of the slow death of these failing businesses - the last attempts of "some guys" desperate for returns trying to squeeze blood from a rock that everyone else was avoiding.
See, what I fundamentally disagree with is the notion that hospitals should be "good business." Why are "some guys" allowed to try to make a profit here at the expense of patient care? Healthcare (or government) should not be run like a business, and instead be provided as a service using the taxes we already pay for, much like how roads are built. The health of the public is our most vital infrastructure, and public infrastructure requires investment that you really can't make money on without defeating the whole purpose of public service.
By this argument why does anything cost money? I need shelter if I am to contribute to society. It should be free!
My own healthcare is extremely valuable to me and I should be allowed to spend money on that. Someone else may decide they'd rather have a new pair of sneakers. Who am I to say they're wrong, that they are not permitted to allocate their capital in this way?
> I need shelter if I am to contribute to society. It should be free!
You do need shelter, and those without housing should be provided somewhere to live. If you'd like to live somewhere nicer/bigger, then you can pay for that, but in a just society I don't see why there should be people starving on the streets. Economically, there are multiple studies that show providing housing to the homeless is at least net-neutral, and results in quite positive outcomes for participants [1,2,3]. Although the research is still in early stages and not deployed on a large scale, I think it at least illustrates the point that giving people who need it housing is not the straw-man that your comment implies it to be.
> My own healthcare is extremely valuable to me and I should be allowed to spend money on that. Someone else may decide they'd rather have a new pair of sneakers. Who am I to say they're wrong, that they are not permitted to allocate their capital in this way?
Sure, for some procedures, it may be viable to shop around or neglect them entirely. But for basic or emergency healthcare, there really isn't an open market. I don't think anyone would choose to "allocate their capital" to a new pair of sneakers when they're bleeding out in the street. For many people, even routine healthcare procedures are out of their financial reach, or at least or prohibitively expensive. Frankly, attempting to compare medical procedures to common goods is not really a fair comparison at all.
> PE can be replaced with "Some guys". PE bought your hospital? More like, "some guys" bought your hospital.
The article is about how PE funds are large, and can thus buy enough businesses to reduce competition. Your "some guys" analogy doesn't hold here, right?
PE bought your hospital? More like, "some guys" bought your hospital.
Ask why "some guys" bought it instead of using their money in the market, or why your hospital sold in the first place. As anyone who's company has been purchased by private equity knows, it's probably because your hospital wasn't doing so hot to begin with and "some guys" were willing to gamble that they could turn it around and make some money before it blew up. This will mean turning the screws on the customers and employees and creating a sucky environment. But this is just accelerating what was likely already an inevitable decline.
As with any risky investment, there's a solid chance the PE firm will lose money on the gamble.
See this recent hacker news submission: https://news.ycombinator.com/item?id=36048464, 30% of rural hospitals are closing due to costs growing faster than revenues.
Hospitals, in many cases, are not good businesses. Especially in places where doctors, nurses, and other staff can demand a premium based on their local market's dearth of professionals. PE firms in my opinion are part of the slow death of these failing businesses - the last attempts of "some guys" desperate for returns trying to squeeze blood from a rock that everyone else was avoiding.