Attacking the Private Equity Looting of Health Care
using existing laws.
I’ve been mulling this over for a bit, and this post https://doctorow.medium.com/when-private-equity-destroys-your-hospital-d3e6c290b1eb by Cory Doctorow was the push I needed to write this. Read it for the background.
Let me start with “I am not a lawyer”, so I don’t actually know if any of this is legally viable. With that caveat in mind:
Personally I’m of the opinion that going after corporate entities is pointless. It’s better to go after people, and if possible using existing laws rather than relying on the contentious passage of new legislation.
1. Since it is common knowledge that what PE firms do to health facilities results in “negative health outcomes”, by which I mean dead patients, it seems to me some DA looking to make a name can charge the owners of these PE firms with manslaughter. Negligent homicide, depraved heart, whatever works in their jurisdiction.
2. Since these are organizations of many people, “conspiracy to commit” charges may also apply.
3. Since what PE firms do is the same as an organized crime “bust out”*, RICO may apply. In which case corporate and private assets can be frozen, confiscated, and turned over to victims**, or in the case of hospitals and practices, turned over to health practitioners to run. I would place the emphasis on private assests, the assets belonging to the officers and owners of the PE firms. The corporate assets would be a nice bonus.
Now, I don’t really know if any of this would fly from a legal perspective, but if the point is to change things, then policy proposals are necessary. Consider this a policy seed — using existing laws against PE firms, especially but not only, in the health care field.
How can you contribute? If you are a lawyer, comment post on whether any of these ideas are viable. Whether you are a lawyer or not, add your ideas for potential solutions, either in a comment or post. In order to change policy you need ideas for new policies. At this stage it’s important to consider options, and for that we need options. Some will prove better than others, and those better proposals can be used to create actual policies.
Ultimately it may need legislation making leveraged buyouts illegal. Frankly I don’t see how they aren’t classified as fraud in the first place.
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*https://doctorow.medium.com/the-long-bloody-lineage-of-private-equitys-looting-798597a4fa30
**If one were to apply this to PEs buying up housing, the properties could be confiscated and redistributed using something like homesteading. By which I mean give them away to people to fix up. Banks may wise up and stop loaning to PE firms when they find they lose their loans and the assets guaranteeing them to RICO.
