Researches by ENCO-Members
- “The creeping privatisation of healthcare. Problematic EU policies and the corporate lobby push”, Rachel Tansey, June 2017
"EU member states’health systems are broadly split between those based on employment-related health insurance and those Mnanced viageneral taxation. But both have been subject to political and policy pressures,including from the EU-level, that have created conditionsconducive to a growing role for private sector companies in thistraditionally public service.
Squeezing profits for shareholders out of health services risks deteriorating working conditions; worse pay, reduced staff levels, greater workloads, more stress, all of which negatively impact on safety and quality of care. Greater health inequality is fostered as private, for-profit providers ‘cherry-pick’ lower-risk and paying patients, whilst higher-risk and poorer patients, or those needing emergency care, remain reliant on under-resourced (thanks to austerity) public health service provision."
- “When the market becomes deadly - How pressures towards privatisation of health and long-term care put Europe on a poor footing for a pandemic”, January 2021, Rachel Tansey
"From hospitals to care homes, the evidence is mounting that outsourcing and private provision of healthcare has significantly degraded EU member states’ capacity to deal effectively with COVID-19. In the context of COVID-19, health budget cuts have led to understaffing and reduced total hospital bed numbers, while the rise of private hospitals goes hand in hand with a fall in intensive care beds, which are less profitable for companies. Profit-oriented care homes have kept their costs down by hiring too few staff, who are often poorly paid, inadequately trained, little or no sick-pay, and with no option but casual work at multiple facilities, contributing to the virus’ spread."
**
Debt Observatory in Globalisation (ODG)
- "Public-Private Partnerships (PPPs) as tools for Privatisation in the health sector", "The case of healtchcare", September 2019, Auditoría Ciudadana de la Deuda en Sanidad (Audita Sanidad), Nicola Scherer (ODG)
"In the case of the public health system in the Spanish State, the application of neoliberal strategies in health services is guided by the so-called “Neoliberal Triad”: Reduction of the role of the State and introduction of co-payments/repayments, Expansion of the private sector in health systems (privatisation of health services), and the deregulation of the public health sector (fragmentation, competition and
internal markets). Dismantling public health systems is a mechanism for restricting rights, transferring the cost of some health benefits to the public and the appropriation of medical insurance and public healthcare funds by multinationals. This report demonstrates that PPPs work very well for investors, the private sector and the ruling political class, while frequently draining public funds and often failing to respect the environment and respond to the needs of citizens. In this sense, the General Hospital de Villalba case in Madrid is an emblematic case and demonstrates the negative impacts that a PPP can have on healthcare.
– (In Spanish) "¿A quién se está rescatando con la excusa de la COVID19?", July, 2020
"Clece, filial del Grupo ACS : Recibidos al menos 7€ millones en contratos por la vía de emergencia en la Comunidad de Madrid, relativos a servicios de limpieza de 32 hoteles, el Hospital de Campaña Ifema y otros dos servicios relativos a la empresa pública del metro de Madrid. En el caso del Hospital de Campaña Ifema ha seguido supuestamente recibiendo compensación incluso con el hospital ya clausurado.
También ha recibido tres contratos públicos por la vía de emergencia por parte del Ministerio de Defensa: el servicio de limpieza intensiva del Centro Militar de Farmacia de la Defensa, el del Hospital General de Zaragoza y el del Hospital Central de la Defensa Gómez Ulla".
– "Defending Life in Cities through Feminist Action. Taking care services out of corporate hands", on working conditions by Clece, February 2020, Blanca Bayas Fernández.
"On 5 March 2007, employees of the company Clece in the city of Girona, Spain – entrusted with cleaning public hospitals, schools and other municipal buildings – began an indefinite strike that would not be forgotten. Strikers were very clear about what they wanted: the (re)municipalisation of the cleaning services. The strike lasted for 37 days and some of the workers’ demands were met, such as the conversion of part-time contracts into full-time contracts, and an increase in permanent staff. More than ten years later, women who work for Clece are still protesting and taking action throughout Spain. The demands of these workers have not changed. Unfortunately, neither has the abuse committed by the company which, if anything, is getting worse."
**
– (In French) "Maisons de repos ou le filon de l’or gris", "The gold mine of care homes", Sébastien Franco, Mai 2019.
"The nursing home market is undergoing major changes in Europe and international commercial players are emerging; this is the case of the French group ORPEA, one of the leaders which is also very present in Belgium."
**
Observatoire des mulitnationales
– (In French) "Covid-19 : ces consultants au cœur de la « défaillance organisée » de l’État" : Consultancies and the ’organised failure’ of the French state in the Covid-19 Pandemic", Olivier Petitjean, June 2020.
"McKinsey, Bain, BCG... After accompanying and encouraging the reduction in the number of civil servants and the submission of public hospitals to management constraints, the major consultancies have secured a key role for themselves with the executive and the administration in shaping the French response to the health crisis. A role that speaks volumes about the reality of the state today."
**
– HCA: Promoting US style for-profit healthcare in the UK, April 2022,
" In February 2022, cleaners at London Bridge Hospital launched a new campaign against healthcare giant Hospital Corporation of America (HCA). HCA is the world’s largest private healthcare company, as well as being both the UK’s and US’ biggest private hospital group. It runs London Bridge Hospital (LBH) as a for-profit business, as well as five other central London hospitals and partnerships around the UK. Many of the cleaners at LBH are organised with the Independent Workers’ Union of Great Britain (IWGB). They are currently demanding fair pay, accusing their employers of failing to provide proper personal protective equipment (PPE) and bullying those who speak out. Corporate Watch has investigated HCA and its business model, to provide information for action for the cleaners’ ongoing campaign."
– "An unhealthy business: major healthcare companies use tax havens to avoid millions in UK tax", March 2012,
"While in public they have been presenting themselves as the future of the NHS, a Corporate Watch investigation into the accounts and finances of five of the major private healthcare companies ( Spire Healthcare, the UK’s second largest private healthcare company ; Care UK, which operates NHS treatment centres, walk-in centres and mental health services across England ; Circle Health, the self-styled “social enterprise” that became the first private company to take over the management of an NHS hospital ; Ramsay Health Care, the company with the greatest number of healthcare provision contracts in the NHS ; General Healthcare Group, the biggest private hospital group in the UK ) has found widespread use of tax havens, including the British Virgin Islands, Luxembourg, Jersey, Guernsey and the Cayman Islands, and tax avoidance schemes Barclays or Vodafone accountants would be proud of."
**
Researches by other organisations
European Federation of Public Service Unions (EPSU))
– Public pensions push profit over care, Mark Hancock and Jan Willem Goudriaan , Apil 2022
The European Parliament’s special Covid-19 committee needs to address the role in this of private operators and ensure public funding to deal with the pandemic did not find its way to tax havens such as Luxembourg. The European Commission’s promised European Care Strategy must learn the lessons from the failed experiments across the world with for-profit care and begin to phase it out.
It is not a few bad actors who are undermining eldercare: it is a systemic problem driven by prioritising profit over people. Front-line care workers must have full protection of union membership to report problems, without retribution when they do so. Any surplus generated should be recycled into improved pay and staffing.
- Resilience of the long-term care sector. early key lessons learned from the Covid-19 pandemic, Karol Florek, October 2021
"Lesson 5 : Private investors are profiting from the pandemic amid an investment boom for nursing homes
An alarming aspect of the crisis is the surge of private investment into Europe’s long-term care market that has taken place during the pandemic. Especially for investors in real estate, the sector is extremely lucrative, and has attracted record levels of investment in 2020. Many providers meanwhile face financial difficulties, thus creating conditions for takeovers. This final section of the report considers the implications of this dynamic. There is a critical need to undertake reforms that remove perverse incentives which encourage profit-extraction from care at the expense of workers, care recipients and their families.
An investment boom has been quietly taking place in the midst of the pandemic disaster. While COVID-19 decimated nursing homes and tens of thousands of residents died, leaving behind bereaved families and beleaguered care workers, 2020 also saw investment volumes for nursing homes rise to a record of 3.6% of all European investment, up from an average of 2.3% in previous years. Serious questions need to be asked about the ethics of such a situation. How is it possible for nursing homes to be at the centre of an investment boom in the midst of a pandemic that has exposed the fatal consequences profit-making from care?”
**
Centre for International Corporate Tax Accountability & Research (CICTAR)
"ORPEA: Caring for People or for Profit", The Financial Engineering and Rael Estate Investment of Group Orpea, A joint report by CICTAR, Fédération CFDT Santé-Sociaux e and Fédération Santé Action Sociale CGT, February 2022.
"The report, avaibale in French and English, examines how Europe’s largest care home operator, Groupe ORPEA has been building a property empire, through complex and opaque structures, while facing allegations of understaffing, diversion of public funds, and the rationing of food and sanitary items. Our research reveals Group’s 40 Luxembourg subsidiaries used to expand a European property portfolio. In one case, the beneficiaries of an ORPEA property acquisition in France remain hidden behind two shell companies in Panama and the British Virgin Islands.
CICTAR, CFDT and CGT make no allegations that ORPEA acted unlawfully. But the three organisations demand an immediate review of ORPEA’s finances and operational performance, greater financial transparency and accountability across the sector, particularly in relation to public funds, and guarantees of worker’s rights and whistle-blower protection for front-line care staff.
We put a list of questions to ORPEA inviting them to respond to the allegations in this report, but at the time of finalizing this report, the company had not provided us with a response. If we receive a response from ORPEA, we will publish it here, alongside the report itself."
"HC-One: Death, Deception, Dividends", December 2021.
"CICTAR’s latest report reveals details of how the UK’s largest care home operator shifted profits offshore to private investors, while appearing to report artificial losses allowing it to dramatically reduce or eliminate tax payments and justify millions more in government funding. The report found that the owners of operator HC-One siphoned millions in tax-free profits to the Cayman Islands during the pandemic, while receiving an additional £18.9m in government payments for COVID-19 costs. It also details how HC-One, which is heavily reliant on public funding, appears to have created a pattern of artificial losses over many years through dividends, lease payments and excessive interest on related party debt paid to offshore owners. As the troubled social care sector recovers from the impact of COVID-19, the CICTAR report, Death, Deception & Dividends, calls for transparency and accountability before any proposed increases in public funding. HC-One denies that the arrangements highlighted by the report have any impact on the quality of care."
- "Darkness at Sunrise: UK Care Homes Shifting Profits Offshore?", February 2021.
"COVID-19 deaths in UK care homes, estimated at over 30,000, have exposed underlying and systemic problems in the care sector. Placing the profit motive at the heart of the social care system in the UK has undoubtedly contributed to increased infection rates and raised the death toll. Under-staffing and low pay are one side of profit maximisation. The other side, largely unseen, is aggressive tax avoidance in a sector heavily reliant on a public funding. This report outlines how three UK care home operators, with more than 60 homes, collect hundreds of millions of pounds in resident fees, while shifting profits offshore through complex corporate structures and tax haven subsidiaries. These three operators reflect a broader pattern across the UK care sector now dominated by private equity investors seeking to extract and offshore profits.The three UK care home companies – Sunrise, Gracewell and Signature Senior Living – are owned by Revera, the second largest care home operator in Canada. Revera, facing scrutiny for COVID-19 deaths, is 100% owned by the pension fund for Canadian federal government workers, a Canadian Crown corporation.
KEY POINTS: The three UK care home operating companies, despite charging residents more than £225 million in fees in 2019, report little or no profit in the UK and even claimed multiple tax credits. Tax haven subsidiaries – in Jersey, Guernsey and Luxembourg – own UK care homes as part of complex corporate structures apparently designed to extract and offshore profits. Reports to the shareholders of the joint venture partner in the three UK care home companies, a large US listed real estate company, indicate US$84.8 million in net operating income from these care homes in 2019. In stark contrast, the three private UK care home companies reported combined losses of US$12.6 million in the most recent year. The use of tax havens, complex related party transactions and other artificial arrangements, including Scottish Limited Partnerships, allow foreign investors to avoid UK income tax on profits extracted from UK care homes, which have been hard hit by COVID-19 and are heavily reliant on tax-payer funding.
Residents and family members, as well as predominately female care workers, suffer the direct consequences of profit extraction from the UK care sector. However, when global investors avoid tax by shifting profits offshore everyone in the UK suffers. While private payments by residents drive profits, they are underwritten by government spending on public health."
FRESENIUS Failing to care: Global tax dodging by a German healthcare multinational, January 2020
"Fresenius, through its various divisions, is ranked in the top 260 global corporations. Fresenius Medical Care is the world’s largest dialysis company. With Helios in Germany and Quironsalud in Spain, Fresenius is Europe’s largest private hospital operator. Vamed, based in Austria, is a global hospital developer and operator. Fresenius Kabi is a producer and worldwide supplier of pharmaceuticals and medical equipment.
Fresenius is represented in almost every well-known tax haven around the world, including the Cayman Islands and the British Virgin Islands, Hong Kong, Delaware, Singapore and Panama. The company uses this network of tax havens to shift profits and avoid higher corporate taxes in Germany and other countries. Intra-group loans are a popular instrument: In 2017, for example, the two Irish Fresenius subsidiaries made a profit of 47 million euros just by granting loans to group companies in Spain and the United States – without any employees.
This case study demonstrates that profit shifting and transfer pricing are not just the domain of US tech giants, but pervasively used by most multinationals, including large German multinationals like Fresenius,” says Gabriel Zucman, Professor of Economics at the University of Berkeley and member of the Independent Commission on the Reform of International Corporate Taxation (ICRICT). And Germany in particular is among those who are suffering: “My research shows that Germany may lose more than any other EU country from transfer pricing to European tax havens. The German government must get behind proposed reforms for unitary taxation and greater transparency. Fresenius, as a company which relies on government spending for public healthcare, must abandon tax haven structures and play a leadership role in promoting a fairer and more transparent global tax system. Companies, no matter their size, must compete on a level playing field and governments need the revenue to fund public services, like healthcare.”
**
Centre for Health and the Public Interest (CHPI)
- "For Whose Benefit? NHS England’s contract with the private hospital sector in the first year of the pandemic", Sid Ryan, David Rowland, David McCoy & Colin Leys , October 2021.
"This report analyses the government’s use of the private hospital sector to alleviate the burden on the NHS during the first year of the COVID pandemic. Under this strategy, NHS England purchased access to practically the entire private hospital sector at the outset of the pandemic, in a series of contracts that would run between March 2020 and March 2021.
However, this research shows that none of the goals outlined for the deal were achieved to a significant extent. Almost no COVID patients were treated in the private sector and NHS funded activity in the private sector fell significantly, and much further than in NHS Trusts. While underutilisation of the purchased capacity was a persistent feature of the contracts, successive renegotiations to cut costs and reduce the amount of capacity purchased left the NHS unprepared for the worst effects of the second COVID wave.
Meanwhile, the 26 private hospital companies benefited significantly from the deal, as the secure, government backed guarantee of their operating costs protected the sector from losses caused by the pandemic, private healthcare was allowed to continue even when the NHS was under the greatest strain and the sector is now in a position to capitalise on the pent-up demand for healthcare."
**
People’s Health Movement (PHM)
- "Reclaiming Public Health. Experiences and Insights from Europe", June 2021.
"PHM Europe has wrapped up a series of case studies conducted on alternatives to privatization of health in Europe. The collection presents four case studies (Slovakia, Croatia, Belgium, Sweden) on deprivatization of public health services through democratic control and participatory process as well as through alternative approaches to health care when other options fall short of meeting the needs of communities.
• In Slovakia, high-profile litigation initiated by the health insurance company Achmea against the Republic of Slovakia to stop the government’s attempt to regulate the distribution of the company’s profits illustrates how limiting the privatization paradigm can be for countries - especially when it’s enshrined in international trade and law regulation.
• In Croatia, changes in the main healthcare act have meant that local administration units can take a more active and inclusive approach to healthcare delivery and planning. In some regions the introduction of regional health councils has fostered the inclusion of patients’ associations and trade unions in the design of regional health plans.
• In Belgium, doctors united in the collective Doctors for the People have been providing free primary healthcare for all who need it for decades, independently of their capacity to pay.
• In Sweden, in a rural town, health workers have chosen to counter the trend of privatization of primary health care centres trends by taking over operation of their local clinic through a cooperative which has grown to include wider community ownership.
-"Resisting Privatization of Health Services" : "Spain: Marea blanca, a rising tide against privatization"
In 2012, the government of the Community of Madrid released a proposal to restructure the health system which would result in privatization of several hospitals and clinics. In response, the marea blanca, or white tide, movement rose in opposition of the proposal. PHM-North America was able to speak, on separate occasions, with two activists who were part of the marea blanca. Carmen Esbrí is part of the Mesa en Defensa de la Sanidad Pública–Madrid and Mónica García Gómez who was involved through the Asociación Facultativos de Madrid. Unfortunately, because of technical problems we were not able to produce a podcast this time. But please read below what we learned from these activists!
**
Public Services International Research Unit
– “Health Care Reforms and the Rise of Global Multinational Health Care Companies”, March 2015, Jane Lethbridge.
"The 2008/9 global financial crisis has had an impact on the funding and delivery of health and social care. Until 2010, government spending on health care in OECD countries had been expanding, but following the adoption of austerity policies, several years of zero growth have been recorded. This has restricted access to both health and social care services. From 2000/1, annual rates of development assistance for health were about 10% per year but had dropped to 3.9% by 2012-3. Contributions by bi-lateral aid agencies and the World Bank International Bank for Reconstruction and Development have declined. However, the contributions by the public-private partnerships of GAVI Alliance and Global Fund to fight AIDS, TB and Malaria have continued to grow. Overall, the contribution of public-private partnerships and NGOs has started to overtake contributions by governments.
The global health care market is expanding but investors are not always moving from North America/Europe to Asia, Africa or Latin America. Instead, there is a trend to move into Europe from Africa (Netcare), Australia (Ramsay Healthcare) and Singapore (Parkway Holdings). This may be partly explained by the reforms taking place in what were strong European public health care systems, which are encouraging for-profit private sector providers to become providers of publicly funded health care. In social care, the expansion of multinational companies has been slower because social care requires a local system of delivery.Family capital is still a source of capital for Asian healthcare companies. State investors play a role in for-profit health care companies. Institutional investors retain a significant influence.In Europe and North America, private equity investors are the majority investors in holding companies, which are health care chains. The International Finance Corporation (IFC) has invested in several health care companies which have become global companies. "
**
– “The eu’s role in attacking healthcare”, July 2020, Emma Clancy
"The COVID-19 pandemic has shown the EU’s healthcare and public sectors to be ill-equipped to respond to the outbreak in accordance with international best practice. A decade of austerity imposed by the European Union institutions and EU Member State governments has caused significant deterioration in healthcare ser-vices across the EU. The Stability and Growth Pact has been the central tool used to enforce austerity across the EU since the 2008 financial crisis. Member States’ spending on healthcare provision has been targeted for reduction by the Commission every year since the crisis."
>- “The struggle for health - An emancipatory approach in the era of neoliberal globalization”, Ferburary 2018, Amit Sengupta, Chiara Bodini, Sebastian Franco
"This booklet has its origins in a meeting in autumn 2016, attended by over thirty activists, researchers and health professionals from Africa, Latin America, Asia, Europe and North America. After intensive discussions and debates the meeting concluded unanimously that the struggle for health is a political struggle which challenges the fundamental practices of our society and the trends which shape them.’
– (in German) "Unsere Gesundheit, ihr Profit? - Fallstudien zu Union-Busting privater Gesundheits- und Pflegekonzerne und gewerkschaftlicher Gegenwehr", Ferburay 2021, Lucy Redler.
"The outbreak of the global COVID-19 crisis has suddenly brought the issue of health to the centre of social attention. However, it has also been recognised that health hazards are largely related to the capacities of health systems - for example, whether there is enough protective equipment available, but above all whether hospitals and nursing homes are equipped with sufficient bed capacities and enough staff to guarantee "good" care. If we contrast this sad truth with another reality, it becomes clear where the causes lie: For 2019, healthcare groups such as Orpea, Korian or Fresenius reported profits in the millions, in some cases in the billions. While health care is being trimmed for efficiency and cost reductions, multinational and listed companies are recording profits that they pass on to their shareholders. The dangerous cuts in care and health are the result of the "business of health". Over the years, health and care services have been restructured into a lucrative market in which private companies are now competing for the largest share of the cake, sometimes using extremely questionable methods. It is precisely this context that this study sheds light on: using the corporate strategies of four important, globally operating health care corporations, it shows how their business model is clearly at the expense of the workers and how the corporations systematically try to push back trade union structures, break them up or even prevent them from coming into being in the first place. However, the study also shows that the workforces are not letting this happen without a fight. The growing influence of private companies and the market-like reorganisation of the public health system are seen by trade unions and workers as a central area of conflict in society.
This study not only provides insights into struggles over health. It also shows the need to reverse privatisation and commercialisation tendencies and to make health care a publicly financed, democratic and social infrastructure again. Understanding how the business models of the big players in the health and care market work makes it possible to identify the right points of intervention to prevent further profits from health. With this study, we want to encourage people to fight in trade union and civil society disputes for a demand-oriented and democratically controlled financing and organisation of health care."
- (In German) "Krankenhäuser in Bewegung - Internationale Kämpfe für gute Versorgung und Arbeitsbedingungen", December 2020, Julia Dück, Stefan Schoppengerd.
"Without the persistence of further protests, it is to be feared that the high profile of hospital workloads will have been a brief episode, driven by fears of a collapse of the health system under exponentially evolving infection rates. It is therefore necessary that unionised workers and their allies succeed in using the experience of the state of emergency to criticise and change the status quo. Working on the edge of overload, economic constraints that contradict medical and social needs, or the feeling that better, more humane work would be possible in a different system - these were not alien to many hospital workers even before Corona. At the same time, the weak points of a system in which competition and cost pressure prevail became more than visible through the pandemic, even for those who are not directly familiar with everyday hospital life as employees or patients."
- (In German) "Gesundheit ist eine Ware- Mythen und Probleme des kommerzialisierten Gesundheitswesens. Dritte, vollständig überarbeitete Auflage", August 2017, Nadja Rakowitz.
"A lot of money is at stake when it comes to health - and some of this money is not yet fully subjected to capitalist interests. Therefore, one has to look very closely at who criticises what about the health care system and proposes which solutions based on which diagnoses. After a short introduction to the health care system in Germany, the first part of the brochure cracks myths of the health policy debate. The second part then examines various problem diagnoses and their supposed solutions and analyses the background. In the third part, we present reform proposals and alternatives for discussion and show that things could be different and better even within capitalist conditions."
**
- "On the Corona Frontline - The Experiences of Care Workers in Nine European Countries", 2021.
"Across Europe, the coronavirus pandemic has hit the elderly hard, and particularly those in elder care, placing care workers on the corona frontline of an underfinanced, understaffed and undervalued care sector. Years of austerity policies and neoliberal new public management have increased the level of privatisation and precarisation, and decreased the rate of unionisation. This report summarises nine country studies on the effect of coronavirus on care workers in Denmark, England, Finland, Germany, Norway, Portugal, Scotland, Spain and Sweden."
**
- (In Spanish) "Residencias en tiempos de COVID", December 2020.
"The poor management during the peak of the first wave of the pandemic led to a lack of staff protection (no personal protective equipment -EPI- nor access to PCR tests), scarcity of resources and minimal medical-health care, the widespread and discriminatory exclusion of hospital referral and isolation of residents for weeks at a time with hardly any communication with their families or the outside world. Amnesty International denounces five human rights violations (to health, to life, to non-discrimination, to private and family life and to a dignified death) and warns of the risk of their repetition. "
Campaigning resources
– "The Pandemic& Privatisation Campaign resource pack for conference", February 2021
"This campaign resource pack has been prepared for the conference ‘The Pandemic and Privatisation’, held online on February 25 2021. Key arguments in brief : The NHS is open to all patients, whereas private companies will restrict access to protect profits and abandon NHS contracts when their profits fall, leaving the NHS to pick up the pieces ; Public funds spent with private companies flow out of the NHS and lead to underinvestment in the NHS staff and equipment ; Studies show that outsourcing is associated with lower quality care and poorer access and can be unsafe and yet some companies are still contracted despite their poor track record ; Staff terms and conditions are less protected, continuity of care is more difficult, and outsourcing offers the public care that is less accountable and poorer value ; Outsourcing can help patients where NHS care is not available: but overall, the evidence shows that the NHS provides better value and fuller access to high-quality care."
Scientific articles and books
National Bureau of Economic Research
– "Does Private Equity Investment in Healthcare Benefit Patients? Evidence from Nursing Homes", February 2021, Atul Gupta, Sabrina T. Howell, Constantine Yannelis & Abhinav Gupta.
"The past two decades have seen a rapid increase in Private Equity (PE) investment in healthcare, a sector in which intensive government subsidy and market frictions could lead high-powered for-profit incentives to be misaligned with the social goal of affordable, quality care. This paper studies the effects of PE ownership on patient welfare at nursing homes. With administrative patient-level data, we use a within-facility differences-in-differences design to address non-random targeting of facilities. We use an instrumental variables strategy to control for the selection of patients into nursing homes. Our estimates show that PE ownership increases the short-term mortality of Medicare patients by 10%, implying 20,150 lives lost due to PE ownership over our twelve-year sample period. This is accompanied by declines in other measures of patient well-being, such as lower mobility, while taxpayer spending per patient episode increases by 11%. We observe operational changes that help to explain these effects, including declines in nursing staff and compliance with standards. Finally, we document a systematic shift in operating costs post-acquisition toward non-patient care items such as monitoring fees, interest, and lease payments."
**
Social Policy & Administration
– "The growth of private home care providers in Europe: The case of Ireland", September 2020, Julien Mercille, Nicholas O’Neill.
"Private for‐profit home care providers have grown unevenly in Europe and through varied processes. Yet, more research focusing directly on private providers is needed to identify and explain European patterns in their growth and in their modes of operation. This paper examines the case of Ireland, where private providers have grown significantly in recent years and transformed the national landscape of domiciliary care. First, it is shown that the amount of public funding received by private providers increased from €3 million in 2006 to €176 million in 2019, in contrast to amounts allocated to non‐profit and public providers that have increased only slightly. Second, those trends are explained through policy analysis and by drawing on in‐depth semi‐structured interviews with private home care providers and government officials who have been central to the privatization of care. The paper gives a direct voice to key figures in private home care, and through a critical reading of interview materials, argues that the neoliberal nature of the Irish state has driven the growth of private provision, in particular, through policies of competitive tendering and fiscalization. Providers’ own lobbying activities have also played a role, albeit a secondary one. Ireland has traditionally followed a laissez‐faire, family‐based system comparable to Southern European countries. Its experience is thus directly relevant to that region, but further research should also compare and contrast the development of private providers operating in other European long‐term care regimes."
**
Human Development Report Office (HDRO) of the United Nations Develop-ment Programme (UNDP)
– "Privatization and Pandemic: A Cross-Country Analysis of COVID-19 Rates and Health-Care Financing Structures", May 2020, Jacob Assa, Maria Cecilia Calderon.
"The outbreak of coronavirus and the infectious disease it causes (COVID-19) have taken different paths around the world, with countries experiencing different rates of infection, case prevalence and mortality. This simultaneous yet heterogenous process presents a natural experiment for understanding some of the reasons for such different experiences of the same shock. This paper looks at the privatization of healthcare as one key determinant of this pattern. We use a cross-section dataset covering 147 countries with the latest available data. Controlling for per capita income, health inequality and several other control variables, we find that a 10% increase in private health expenditure relates to a 4.3% increase in COVID-19 cases and a 4.9% increase in COVID-19 related mortality. Globalization also has a small positive effect on COVID-19 prevalence, while higher hospital capacity (in beds per 1,000 people) is significant in lowering COVID-19 mortality. The findings suggest caution regarding policies which privatize healthcare systems in order to boost efficiency or growth in the short-run, as these reduce countries’ long-term preparedness for dealing with pandemics."
**
International Journal of Health Services
– "For-Profit Nursing Homes in the Netherlands: What Factors Explain Their Rise?", April 2020, Aline Bos, Florien Margareth Kruse, Patrick Paulus Theodoor Jeurissen.
"This exploratory, mixed-methods study analyzes characteristics of the emerging for-profit nursing home industry in the Netherlands and identifies the interrelated set of factors (context, trends, and sector conditions) that contribute to its growth. Until recently, the Dutch nursing home sector relied almost exclusively on nonprofit providers. Even though profit distribution in nursing home care is still banned, the for-profit nursing home sector is expanding. The study uses economic theory on nonprofit organizations and mixed-form markets to understand this expansion. We find that changes in the regulatory framework have unlocked the potential of the for-profit nursing home sector, enabling for-profit nursing homes to circumvent the for-profit ban. The expansion of the for-profit sector was mainly driven by the low responsiveness of the nonprofit sector to increased and changed demands. For-profit providers took advantage of this void. Moreover, they exploited “cream-skimming” potential in the market and used the wider care system to reduce their labor costs by relying on external specialist care. Another main driver was the access to financial capital from private investors (e.g., private equity firms)."
**
– Les Fossoyeurs , January 2022, Victor Castanet, Fayard (in French)
"After three years of investigation, The journalist Victor Castanet delivers a disturbing dive into the secrets of the Orpea group, world leader in nursing homes and clinics. Full of revelations, this breathtaking and moving story brings to light many abuses, far from the dedication of the teams of carers and caregivers."
**
– The Privatization of Care - The Case of Nursing Homes , 2020, Pat Armstrong, Hugh Armstrong (Edited by), Routledge
"Nursing homes are where some of the most vulnerable live and work. For the last eight years an international team from Germany, Sweden, Norway, the UK, the US and Canada have been searching for promising practices that treat residents, families and staff with dignity and respect in ways that can also bring joy. While we did find ideas worth sharing, we also saw a disturbing trend toward privatization.
Privatization is the process of moving away not only from public delivery and public payment for health services but also from a commitment to shared responsibility, democratic decision-making, and the idea that the public sector operates according to a logic of service to all.
This book documents moves toward privatization in the six countries and their consequences for families, staff, residents, and, eventually, us all. None of the countries has escaped pressure from powerful forces in and outside government pushing for privatization in all its forms. However, the wide variations in the extent and nature of privatization indicate privatization is not inevitable and our research shows there are alternatives."
**
Private Equity im Bereich der Gesundheits- und Pflegeeinrichtungen in Deutschland, 2020, Rainer Bobsin (in German)
"Which hospitals, medical and dental practices, medical laboratories, medical care centres (MVZ), physiotherapy practices, rehabilitation clinics, nursing homes and care services have been acquired by the affiliated companies so far? Although private equity investors have been investing in the health services and social economy in Germany since 1998 - increasingly in the last three to four years with provisional peak in 2019 - takeovers have only only occasionally attracted broader attention. The market as a whole remained unobserved. This is aggravated by the fact that the knowledge situation must be described as poor due to missing or unpublished data. This publication therefore attempts to provide an up-to-date insight into the following areas of care: Hospitals, contract medical care (medical/dental practices, medical care centres, medical laboratories, physiotherapy practices, rehabilitation clinics, nursing facilities and out-of-hospital intensive care."
**
Press investigations
– "The trickle-down effect of public assistance, Orpea style", March 2022
– "At Orpea group’s care homes in France, permanent contracts are nowhere to be found"
– "Grey gold — The billion Euro business of elder care", July 2021
– "How a European care home chain moves its profits offshore", July 2021
– "Cashing in on care — the UK and Europe", July 2021
– "List: The biggest private equity companies in the sector", July 2021
– "List: Europe’s largest for-profit care home operators", July 2021
**
Private Equity’s Ownership of Nursing Homes Is Killing Senior Citizens, February 2021, Julia Rock, David Sirota.
"As governors in New York and Florida face political crises over their handling of the pandemic, the scandals have spotlighted how a disproportionate amount of COVID-19 casualties have occurred in the nation’s nursing homes. The situation is a cautionary tale not only about political corruption, but about the consequences of a nursing home infrastructure being run by for-profit corporations — and now a study documents some of the body count.
The analysis found that between 2004 and 2016, more than twenty thousand Americans perished as a consequence of living in nursing homes run by private equity firms. The data showed that going to a private equity–owned nursing home significantly “increases the probability of death during the stay and the following 90 days” as compared to nursing homes with a different ownership structure."
**
– (In Spanish) Fondos de inversión, multimillonarios y algún empresario corrupto controlan los 13 mayores grupos de residencias en España, April 2020, Manuel Rico.
"Of the five main companies, all with more than 45 nursing homes, two have Jersey funds as their main shareholder (Vitalia Home and Colisée), one an English fund (DomusVi) and another a Canadian pension fund (Orpea). Five of Spain’s richest men are also in the business: Florentino Pérez, the ’Albertos’ (Clece), Modesto Álvarez Otero and Carlos Álvarez Navarro (Ballesol). And France’s fifth-richest family: the Mulliez family (Amavir). Two groups are controlled by businessmen implicated in the Gürtel case: the already convicted Enrique Ortiz (Savia) and the doubly indicted José Luis Ulibarri (Aralia)."
– (In Spanish) El ’mapa de la muerte’ de la multinacional DomusVi: más de 150 mayores fallecidos en ocho de sus residencias, April 2020, Manuel Rico.
"DomusVi, controlled by a British investment fund, has made a significant part of the most mournful headlines in Spain’s care homes in Spring 2020. It also has five homes for the elderly that have been taken over by the authorities in four Spanish regions. And it has accumulated complaints from relatives about lack of information, staff and protection measures. The company assures that keeping families informed is one of its "priorities" and affirms that it always complies with the staffing obligations established in the different regional legislations".
– (In Spanish) [Las residencias de mayores en Europa: máquinas de hacer dinero para empresas e inversores->https://www.infolibre.es/noticias/mundo/2021/07/27/las_residencias_mayores_europa_maquinas_hacer_dinero_para_empresas_inversores_123067_1022.html], July 2021
"The problems with multinationals in the sector are identical across Europe: endemic staff shortages, lack of public control over the service they provide and tax engineering practices to reduce tax payments."
| - Mapping the privatisation of healthcare in Europe |
