Private equity firms are pouring investment dollars into hospices at a record pace. Meanwhile, legislators and regulators as far up as the White House are taking aim at those firms.

Despite a cool down in the hospice mergers and acquisitions market during the first quarter of 2022, private equity firms have stayed aggressive on deals. About 30% to 50% of home health and hospice transactions in 2021 involved private equity, according to the M&A advisory firm The Braff Group.

With this growing influence comes renewed scrutiny about their impact on patient care, federal policymakers have indicated. Even President Joe Biden called out PE investors during his State of the Union address this year.

“As Wall Street firms take over more nursing homes, quality in those homes has gone down and costs have gone up. That ends on my watch,” Biden said. “Medicare is going to set higher standards for nursing homes and make sure your loved ones get the care they deserve and expect.”

Though the president’s remarks focused on nursing homes, investors throughout the health care continuum should take note. A number of agencies and some lawmakers have also started to step up oversight of these firms.

Federal rules are changing

The U.S. Securities and Exchange Commission (SEC) in January proposed amendments to reporting requirements for advisors to large hedge funds and private equity funds.

If made final, the new rules would require these individuals to file reports within one business day...

Read Full Story: https://hospicenews.com/2022/06/23/regulators-taking-aim-at-hospice-pe-backers/