While private equity investment can provide stable funding and allow practices to be innovative, it may be incompatible with physician practice ethics and sustainability, the American Medical Association wrote in a recent blog post.
The Aug. 1 post outlined a study in JAMA Internal Medicine that showed that physician management companies with private equity investment led to a rise in prices for anesthesia services for patients.
Anesthesia service prices rose 26 percent for patients who used private equity-backed physician management companies, while prices at companies without private equity investment grew by 12.9 percent from 2012 to 2017.
The post also cited a commentary from AMA President Jack Resneck, MD, published in JAMA Dermatology in which dermatologists reported a loss in physician control after being acquired by private equity firms.
"While investors tout ongoing local decision-making, practices also may lose some control over staffing levels and capital equipment purchases," Dr. Resneck stated in the commentary.