Stopping Private Profiteering in Healthcare

After the collapse of Steward Health Care, which led to the closure of two hospitals and the loss of patient lives, Massachusetts has taken a big step. A new law aims to keep private equity out of local healthcare. This isn't about banning private equity, but making sure they can't squeeze money out of hospitals and leave them in ruins. The law is a first in the country. It stops hospitals from selling their main campuses to investors and makes sure investors are watched. If they own even 10% of a hospital, they have to share info and join state oversight hearings. This is like pulling back the curtain on who's making money from Massachusetts' healthcare.

However, the law won't stop all profiteering. Some say it should go further and change the business practices that cause health systems to fail. One big bad habit is selling hospital buildings to real estate companies and then leasing them back. This is what Steward did, leading to huge rents that caused their bankruptcy. The new law will stop most of these deals. But private equity firms have other tricks to take money out, like loading hospitals with debt. The state had to take this first step to find out who owns what in healthcare. Experts say it's a good start, but there's more to do. Other states are trying too, but so far, Massachusetts is leading the way.

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