Private Equity Acquisitions In Primary Care: Changes In Utilization, Spending, And Workforce

Primary care is essential to advancing population health, yet it has faced underinvestment and workforce shortages in the US. Private equity (PE) investments could expand access by facilitating participation in value-based contracts and enhancing information technology capacity. However, PE's emphasis on short-term profitability may impose productivity pressures on physicians, with uncertain implications for patient care. Using a stacked difference-in-differences design and national Medicare claims data, we examined 225 PE acquisitions of primary care practices during the period 2016-22. PE acquisition increased the number of services billed and patients seen by primary care physicians by 30 percent and 11 percent, respectively. Patients in PE-acquired practices received 12.9 percent more additional services, driven by laboratory testing and the Medicare annual wellness visit. PE acquisitions also increased the total number of primary care physicians and advanced practice providers, with the latter growing at a faster rate. Taken together, our results suggest that PE investments have the potential to increase the use of primary care services, in part through greater reliance on advanced practice providers.