Medicare expenditures in private equity-affiliated private practices were an average of 9.8% lower than for patients treated in hospital-affiliated practices in 2022, according to a recent study by Avalere and the American Independent Medical Practice Association.
The study looked at physicians specializing in cardiology, gastroenterology, urology, oncology and orthopedics from 2018 to 2022.
Here are five key notes to know:
1. The study found that Medicare patients of private equity-affiliated private practices had Medicare expenditures in line, and sometimes lower, than patients of unaffiliated private practice physicians or those in hospital or corporate settings.
2. Per-beneficiary Medicare expenditures were an average of $963 lower for beneficiaries whose physicians moved from an unaffiliated model to a private equity affiliation in the 12 months following the transition, compared to an average of $1,140 higher for beneficiaries whose physicians moved from an unaffiliated model to corporate affiliation in the year following the transition.
3. Additionally, patients in hospital and corporate settings had greater numbers of inpatient days and emergency department visits.
4. Medicare expenditures for patients attributed to hospital-affiliated physicians had the highest percentage of expenditures in the facility setting (64% to 69%) compared to other practice affiliation models.
5. The analysis shows that hospitals — rather than practices supported by private equity groups — are more likely driving Medicare spending growth, Jack Feltz, MD, chair of the AIMPA's Federal Health Policy Committee, said in a Sept. 18 news release.