Tonight at midnight, thousands of federal workers face the possibility their jobs will be eliminated as part of the Department of Government Efficiency (DOGE) federal cost reduction initiative under Elon Musk’ leadership. Already, thousands who serve in federal healthcare roles at the NIH, CDC and USAID have been terminated and personnel in agencies including CMS, HHS and the FDA are likely to follow.
The federal healthcare workforce is large exceeding more than 2.5 million who serve agencies and programs as providers, clerks, administrators, scientists, analysts, counselors and more. More than half work on an hourly basis, and 95% work outside DC in field offices and clinics. For the vast majority, their work goes unnoticed except when “government waste” efforts like DOGE spring up. In those times, they’re relegated to “expendables” status and their numbers are cut.
The same can be said for the larger private U.S. healthcare workforce. Per the U.S. Bureau of Labor Statistics, industry employment was 21.4 million, or 12.8% of total U.S. employment in 2023 and is expected to reach 24 million by 2030. It’s the largest private employer in the U.S. economy and includes many roles considered “expendable” in their organizations
Facts about the U.S. healthcare workforce:
- More than 70% of the healthcare workforce work in provider settings including 7.4 million who work in hospitals.
- More than half work in non-clinical roles.
- Home health aides is the highest growth cohort and hospitals employ the biggest number (7.4 million).
- 29% of physicians and 15% of nurses are foreign born, almost three-fourths of the workforce are women, two-thirds are non-Hispanic whites, and the majority are older than 50.
- Its licensed professions enjoy public trust ranking among Gallup’s highest rated though all have declined:
| % 2023 | ‘19-‘23 | ’23 Rank | % 2023 | ‘19-‘23 | ’23 Rank | ||
| Nurses | 78 | -7 | 1 | Pharmacists | 55 | -9 | 6 |
| Dentists | 59 | -2 | Psychiatrists | 36 | -7 | 9 | |
| Medical doctors | 56 | -9 | 5 | Chiropractors | 33 | -8 | 10 |
The Perfect storm
The healthcare workforce is unsteady: while stress and burnout are associated with doctors and nurses primarily, they cut across every workgroup and setting. Eight fairly recent issues complicate efforts to achieve healthcare workforce stability:
Increased costs of living: Consumers are worried about their costs of living: it hits home hardest among young, low-income households including dual eligible seniors for whom gas, food and transportation are increasing faster than their incomes, and rents exceed 50% of their income. The healthcare workforce takes a direct hit: one in five we employ cannot pay their own medical bills.
Slowdown in consolidation: The Federal Trade Commission’s new pre-merger notification mandate that went in effect today essentially requires greater pre-merger/acquisition disclosures and a likely slowdown in deals. Organizations anticipating deals might default to layoffs to strengthen margins while the regulatory consolidation dust settles. Expendables will take a hit.
Uncertainty about Medicaid cuts: In the House’ budget reconciliation plan, Medicaid cuts of up to $880 billion/10 years are contemplated. A cut of that magnitude will accelerate closure of more than 400 rural hospitals already at risk and throw the entire Medicaid program into chaos for the 79 million it serves—among them 3 million low-hourly wage earners in the healthcare workforce and at least 2 million in-home unpaid caregivers who can’t afford paid assistance. The impact of Medicaid cuts on the healthcare workforce is potentially catastrophic for their jobs and their health.
Heightened attention to tax exemptions for not-for-profit hospitals: Large employers sent this recommendation to Congressional leaders last week as spending cuts were being considered: “Nonprofit hospitals, despite their tax-exempt status, frequently prioritize profits over patient care. Many have deeply questionable arrangements with for-profit entities such as management companies or collections agencies, while others have “joint ventures” with Wall Street hedge funds or other for-profit provider or staffing companies. Nonprofit hospitals often shift the burden of their costs onto taxpayers and the communities they serve by overcharging for health care services, or abusing programs intended to provide access to low-cost care and prescription drugs for low-income patients. By eliminating nonprofit hospital status, resources could be more evenly distributed across the healthcare system, ensuring that hospitals are held accountable for their charitable care both to their communities and the tax laws that govern them.” Pressures on NFP hospitals to lower costs and operate more transparently are gaining momentum in state legislatures and non-healthcare corporate boardrooms. Belt tightening is likely. Layoffs are underway.
Heightened attention to executive compensation in healthcare organizations: Executive compensation, especially packages for CEO’s, is a growing focus of shareholder dissent, Congressional investigation, media coverage and employee disgruntlement. Compensation committee deliberations and fair market comparison data will be more publicly accessible to communities, rank and file employees, media, regulators and payers intensifying disparities between “labor” and “management”.
Increased tension between providers and insurers: Health insurers are now recovering from 2 years of higher utilization and lower profits; hospitals did the same in 2022 and 2023. Neither is out of the woods and both are migrating to tribal warfare based on ownership (not-for-profit vs. investor owned vs. government owned), scale and ambition. Bigger, better-capitalized organizations in their ranks are faring better while many struggle. The workforce is caught in the crossfire.
Increased pressure on private equity-backed employers to exit: The private equity market for healthcare services has experienced a slow recovery after 2 disappointing years peppered by follow-on offerings in down rounds. Exit strategies are front and center to PE sponsors; workforce stability and retention is a means to an end to consummate the deal—that’s it.
The AI Yellow Brick Road: Last and potentially the most disruptive is the role artificial intelligence will play in redefining healthcare tasks and reorganizing the system’s processes based on large-language models and massive investments in technology. Job insecurity across the entire healthcare workforce is more dependent on geeks and less on licensed pro’s going forward.
These eight combine to make life miserable most days in health human resource management. DOGE will complicate matters more. It’s a concern in every sector of healthcare, and particularly serious in hospitals, medical practices, long-term and home care settings.
‘Modernizing the healthcare workforce’ sounds appealing, but for now, navigating these issues requires full attention. They require Board understanding and creative problem-solving by managers. And they merit a dignified and respectful approach to interactions with workers displaced by these circumstances: they’re not expendables, they’re individuals like you and me.
Paul
Sections in today’s Report
- Quotables
- Economy
- Employers
- Hospitals
- Insurers
- Leadership
- Physicians
Quotables
Axios on Trump Presidency: “Whether you admire — or abhor — President Trump’s boundary-busting first month in office (today = Day 30), it’s important to see with clear eyes what’s truly stretching the law and shaking long-held traditions of White House occupants before him…
The big picture: U.S. presidents face very few restraints. They’re free of conflict-of-interest laws, enjoy the presumption of immunity in all official acts, and have wide latitude to impose their agenda. So it’s worth paying attention when Trump says, as he did over the weekend on Truth Social and X: “He who saves his Country does not violate any Law.”
- Claiming power clearly granted to Congress….
- Rewriting an actual Constitutional amendment (14th)….
- Firing watchdogs…
- Empowering Elon…
- Profiting from the presidency…
- DOJ dictates…
The bottom line: The first Trump term seemed unprecedented, and sometimes was. This one is authentically unprecedented in totality1 big thing: Trump’s boundary-busting provocations Axios February 19, 2025 https://www.axios.com
Leuchter on PE in Healthcare: Dear Secretary Robert F. Kennedy Jr.:
Private equity (PE) is the fastest-growing malignancy of the American healthcare system. In your new position as secretary of HHS, I implore you to protect the health of Americans and put an end to the dangerous practice of leveraged buyouts (LBOs) of healthcare facilities by PE firms.
The purpose of this letter is not to reveal new dangers associated with PE acquisitions in healthcare — ample research already demonstrates the harms of LBOs….
- Unscrupulous financial practices leading to hospital bankruptcies…
- Direct patient harm by diminishing quality of care…
- Financial toxicity from increased costs and overutilization…
The core reason LBOs in healthcare result in net harm to both patients and health systems is that the philosophy of PE is fundamentally incompatible with the goals of healthcare. PE firms are designed to generate outsized returns within a 5-to-10-year timeframe. Achieving the level of profits demanded within this short horizon creates perverse incentives to raise prices, cut corners, and prioritize financial gains over long-term patient outcomes…
In your new position of power, I urge you to act swiftly before it is too late. Yes, there will be a scar, but it will undoubtedly lead to a healthier America.”
Richard K. Leuchter, MD UCLA David Geffen School of Medicine An Open Letter to RFK Jr.: Stop the Spread of Private Equity in Healthcare | MedPage TodayFebruary 19, 2025
Composition of the electorate: “A time comes for every political party when its policies and dominant assumptions no longer meet either the public’s expectations or the needs of the times. We believe that the Democratic Party has reached one of these moments and stands in urgent need of renewal….
For the first time since the mid-20th century, the central fault line of American politics is neither race and ethnicity nor gender but rather class, determined by educational attainment….
The sorting of partisan preferences based on educational attainment is bad news for Democrats, demographically and geographically. Fewer than 38% of Americans 25 and older have earned BAs, a share that has plateaued in recent years after increasing five-fold between 1960 and 2020. And so, it appears, has the Democratic share of the college graduate vote (57% 2020, 56% in 2024) even as the Republican share of the non-college vote surged from 51% to 56%. Meanwhile, non-college voters still make up 57% of the electorate, a figure that rises to 60% in the swing states..”
William A. Galston, Elaine C. Kamarck Renewing the Democratic Party February 2, 2025 https://thirdway.imgix.net/pdfs/override/Renewing-the-Democratic-Party.
Epic as gatekeeper: “A few decades ago, hotels were supreme. They had strong relationships with their customers, who were deeply loyal to particular hotels they trusted.
But that has changed with the rise of online travel agencies (OTAs) like Booking.com and Expedia. Since the late 1990s, these OTAs have dramatically reshaped the travel industry… Today, over half of hotel bookings flow through OTAs, leaving hotels with slimmer margins and less control over their customer relationships.
This dynamic may now be playing out in health care. Epic Systems, the dominant electronic health record (EHR) provider in the U.S., has been quietly positioning itself as a gatekeeper to the health care system through its patient-facing portal, MyChart.
With over 190 million users — enough to rival the population of the eighth-largest country — MyChart has become a critical interface for consumers to access their health records, schedule appointments, and engage in virtual care. Recent moves by Epic suggest that MyChart could evolve into the central hub for patients navigating their care, potentially displacing hospitals as the primary point of contact for consumers….”
What hospitals can learn from travel industry upheaval | STAT
Commercial insurance market stability: “There is no end in sight to the cycle of provider consolidation, insurer loss of bargaining power, pressure on insurers from employers and consumers to keep premium increases low, attempts by insurers to constrain premium increases through restrictions on access to care and choice of provider, widespread consumer dissatisfaction, bigger deductibles and coinsurance, and spiraling costs. Consumer dissatisfaction with delays and denial of care are virtually eliminated under an SPF (Sustainable Pricing Framework) policy. The dysfunctional commercial health care market is no longer sustainable without significant reform. Both the right and left want to find an innovative solution, but defining and agreeing upon a concrete plan has proven elusive. An SPF policy option is a practical and flexible solution that can address the interrelated and complex issues of premium cost, restrictions on access to care, and consumer dissatisfaction. “
Commercial Health Insurance: Spiraling Costs And Growing Dissatisfaction Health Affairs February 18, 2025 https://www.healthaffairs.org/content/forefront/commercial-health-insurance-spiraling-costs-and-growing-dissatisfaction
Buettner on longevity: “My goal here is to convince you that most of what Americans think will lead them to a long, healthy life is misguided or just plain wrong…
The Big Secret here—and the one we miss—is that health and longevity are rarely successfully pursued. They ensue. We spend nearly a half trillion a year trying to chase health with diet, exercise, and pills. They’re all great business plans, but they fail for almost everyone all of the time. If you start with 100 people on a diet, you lose more than 95% in two years. Exercise programs have similar drop offs. Similarly, the $47 billion a year Americans spend on antiaging products has not delivered a single pill, supplement, or stem cell treatment that has been shown to reverse, stop, or even slow aging.
In the blue zones, longevity ensues because people live in an environment where the healthy choice is the easy choice…
So, if we want a healthier America, we should shift our focus from the folly of trying to convince 340 million people to follow a diet or health plan and instead we should strive to set them up for success… The secret to longevity does not lie in any silver bullet. The secret is to shift the focus of public policy from trying to change individual behaviors to setting up all Americans for success by making the healthy choice the easy one.”
U.S. Senate Special Committee on Aging Hearing on: “Optimizing Longevity: From Research to Action” Testimony of Dan Buettner Room 106 Dirksen Senate Office Building February 12, 2025 Optimizing Longevity: From Research to A… | Senate Committee On Aging
On Change Healthcare cybersecurity breach impact on hospitals: “A March 2024 AHA survey of nearly 1,000 hospitals found:
- 74% reported direct patient care impact, including delays in authorizations for medically necessary care.
- 94% reported the attack impacted them financially.
- 33% reported the attack disrupted more than half of their revenue.
- 60% reported requiring two weeks to three months to resume normal operations once Change Healthcare’s full functionality was re-established.
Many providers were forced to seek alternate ways — including pulling from reserves or taking out private loans — to pay clinician and care team salaries, acquire necessary medicine and supplies, and pay for critical physical security, dietary and environmental services contract work. The need to rely on less efficient manual processes in place of electronic ones also added substantial administrative costs… According to Kodiak Solutions, a revenue cycle data analytics firm, the attack caused the value of claims submitted to drop $6.3 billion for their 1,850 hospital and 250,000 physician clients alone in just the first three weeks after the attack.”
Study: County-level health spending: Researchers analyzed claims data for 3110 counties across 4 payers (Medicare, Medicaid, private insurance, and out-of-pocket payments), and according to 148 health conditions, 38 age/sex groups, and 7 types of care from 2010 to 2019.The study captures 76% of total personal health spending for the studies period. Findings:
- More spending was on type 2 diabetes ($143.9 billion [95% CI, $140 billion-$147.2 billion]) than on any other health condition, followed by other musculoskeletal disorders, which includes joint pain and osteoporosis ($108.6 billion), oral disorders ($93 billion), and ischemic heart disease ($80.7 billion).
- Of total spending, 42.2% was on ambulatory care, while 23.8% was on hospital inpatient care and 13.7% was on prescribed retail pharmaceuticals.
- At the county level, age-standardized spending per capita ranged from $3410 in Clark County, Idaho, to $13 332 in Nassau County, New York. Across counties, the greatest variation was in age-standardized out-of-pocket spending, followed by private insurance spending. Cross-county variation was driven more by variation in utilization rates than variation in price and intensity of care, although both types of variation were substantial for all payers but Medicare.
Tracking US Health Care Spending by Health Condition and County JAMA. February 14, 2025. https://jamanetwork.com/journals/jama/article-abstract/2830568
Economy
CMS analysis: Improper payments: Improper payments are those that do not meet CMS program requirements and can include overpayments, underpayments, or payments with insufficient documentation.
“In fiscal year 2024, CMS reported that improper payments totaled $88.5 billion, which is about 5.6% of the agency’s spending… a decrease from previous years, it still represents a significant amount. The majority of these improper payments are due to insufficient documentation rather than fraud.”
CMS www.cms.gov
CBO Report: Federal Spending: Last week, the Congressional Budget Office reported that federal spending rose 15% in the first four months of fiscal 2025.
- Outlays in the first months rose $317 billion to $2.43 trillion from September through January. Discounting for some timing shifts in outlays from 2024 and 2025, spending rose $157 billion, or 7%. We doubt your family budget rose 7%, and if it did you may need a loan.
- Social Security up 7%, Medicare up 5%, and Medicaid up 9%, and defense outlays rose 8%–less than the 13% increase in payments on the national debt. Higher interest rates and ever-rising debt mean interest payments now exceed spending on defense.
Congressional Budget Office February 17, 2025 www.cbo.gov
Employers
ERISA Employers’ Letter to Congress re: Health Policy Preferences: “The ERISA Industry Committee (ERIC) writes to share the policy positions of our large employer member companies, in their capacities as sponsors of health, retirement, and other benefit plans for workers and families, as you consider committee instructions for the budget reconciliation process.
- Preserve the Tax Exclusion for Employer-Sponsored Coverage
- Preserve the Tax Incentives that Help Millions of Workers Save for Retirement
- Enhance High Deductible Health Plans and Health Savings Accounts
- Enact Site-Neutral Payments in Medicare
- Reevaluate Hospitals’ Nonprofit Status
- Codify the Hospital Price Transparency Rule and Transparency in Coverage Rule
- Protect the Tax Treatment of Employer-Provided Fringe Benefits
- Protect and Strengthen ERISA
- Expand Telehealth Access
- Curtail Anticompetitive Hospital Practices
- Affordable Prescription Drugs
- Reduce PBGC Premiums
- Drive Prescription Drug Competition through Targeted Patent Reforms”
ERISA Industry Committee letter to Congressional Leaders February 11, 2025 www.eric.org
Hospitals
Study: Hospital demand: Researchers analyzed weekly hospital occupancy data captured between August 2020 and April 2024, US as part of COVID-19 data tracking efforts. Findings:
“The mean US hospital occupancy was 63.9% (range, 63%-66%) from 2009 to 2019 compared with 75.3% (range, 72%-79%) in the year following the end of the COVID-19 public health emergency (PHE; May 2023 to April 2024). The number of staffed hospital beds declined from a pre-pandemic steady state of 802,000 (2009-2019 mean) to a post-PHE steady state of 674 000, whereas the mean daily census steady state remained at approximately 510,000. There was substantial state-to-state variation in the post-PHE hospital occupancy steady state.
Without changes in the hospitalization rate or staffed hospital bed supply, total annual hospitalizations were projected to increase from 36,174 000 in 2025 to 40,177 000 in 2035 with the aging population. This would correspond to a national hospital occupancy of approximately 85% by 2032 for adult beds and by 2035 for adult and pediatric beds combined.
The US has achieved a new post pandemic hospital occupancy steady state 11% higher than it was pre-pandemic. This persistently elevated occupancy appears to be driven by a 16% reduction in the number of staffed US hospital beds rather than by a change in the number of hospitalizations.
Experts in developed countries have posited that a national hospital occupancy of 85% constitutes a hospital bed shortage (a conservative estimate)4; our findings show that the US could reach this dangerous threshold as soon as 2032, with some states at much higher risk than others. These scenarios suggest that an increase in the staffed hospital bed supply by 10%, reduction in the hospitalization rate by 10%, or some combination of the two would offset the aging-associated increase in hospitalizations over the next decade.”
Health Care Staffing Shortages and Potential National Hospital Bed Shortage JAMA Netw Open February 19, 2025. 2025;8(2):e2460645. doi:10.1001/jamanetworkopen.2024.60645
Insurers
Prior authorization in Medicare Advantage:: “For the first time, more Medicare enrollees received their Medicare benefits through a Medicare Advantage (MA) plan last year than through Traditional Medicare… But of all the issues we navigated, none was raised more than concerns about utilization management, including prior authorization (UM/PA) in MA.
We heard from a full range of bipartisan stakeholders about three fundamental challenges related to the current state of utilization management: 1) barriers to access for medically necessary care, 2) a huge administrative burden on the U.S. health care system, and 3) negative market impacts, particularly for rural hospitals. These are complex problems, and policy approaches must surgically address access and burden issues while still maintaining plans’ ability to reduce waste, low value care, and cost. This paper shares our experience working on these issues at the Center for Medicare and outlines solutions policymakers should continue to pursue. The goal is to provide clearer rules of the road, increased transparency, more effective oversight, and faster streamlining and modernization of processes…
In recent years, while government spending on MA has increased, the portion of the government payments to plans directed towards core Medicare Part A and Part B benefits has decreased. In 2014, on average, more than 76.4% of payments to MA plans was for core Medicare benefits (Part A and Part B) and 7.5% was for supplemental benefits. In 2024, the percentage for supplemental benefits has nearly doubled to 14.7%. According to the 2024 Trustees Report, government spending on rebate dollars has quintupled over the last decade, from $12 billion in 2014 to an expected $65.8 billion in 2024. Of the estimated $9.2 trillion the federal government will pay to MA plans over the next decade, $1.3 trillion will be spent on MA supplemental benefits and premium buy-downs.”
Prioritize Prior Authorization Reforms In Medicare Advantage | Health Affairs February 19, 2025
WSJ on UHG Investigation: “The Justice Department has launched an investigation into UnitedHealth Group’s Medicare billing practices in recent months…
The new civil fraud investigation is examining the company’s practices for recording diagnoses that trigger extra payments to its Medicare Advantage plans, including at physician groups the insurance giant owns.
The Medicare billing investigation adds to the scrutiny on UnitedHealth, the $400 billion company that owns the largest U.S. health insurer and a sprawling network of other health-industry assets including its doctor practices, a large pharmacy-benefit manager and data and technology operations.
The civil investigation, some of the people said, is separate from a longer-running Justice Department antitrust probe that the Journal reported last February. The DOJ also has sued to block UnitedHealth’s $3.3 billion planned acquisition of home-health company Amedisys on antitrust grounds..”
DOJ Investigates Medicare Billing Practices at UnitedHealth Wall Street Journal February 21, 2025 https://www.wsj.com/health/healthcare/unitedhealth-medicare-doj-diagnosis-investigation
Leadership
Gallup on Leadership: From its polling in 52 countries, Gallup identified 4 attributes of leadership:
- Hope is the primary need of followers around the world. Over half (56%) of all attributes linked to influential leaders in daily life speak to the theme of hope — far outdistancing the next most important need of trust (33%).
- The need for hope is universal but emphasized in certain contexts: among the youngest generation (18- to 29-year-olds: 57%), in the Asia-Pacific region (59%) and in relation to organizational leaders (64%).
- More people rate their lives poorly enough to be considered suffering when their leaders do not give them hope. Even though suffering is relatively rare, it is reduced as more of the four needs of followers are met. Among people who do not mention hope in relation to the leader with the most influence in their lives, 33% are classed as thriving and 9% as suffering. However, once the need for hope is met, thriving rises to 38%, and suffering dips to 6%.
- Leaders in the world of work have a huge capacity to improve the lives of others. Those employed by an employer are only slightly less likely to name someone from their work environment (34%) as they are to name a family member (44%) as the leader who has the biggest positive impact on their lives.
Gallup Global Leadership Report: What Followers Wantfile:///C:/Users/Owner/Downloads/Gallup-Global-Leadership-Report-What-Followers-Want-Report.pdf
Physicians
Report: National Resident Matching Program: There were 14,833 medical school graduates seeking a fellowship match in 2025, up by 799 over last year.
- There were 14,620 positions offered, up 451 positions from 2024. Roughly 85% of the positions were filled.
- There were more than 1,900 applicants for the cardiovascular disease residency, 1,131 for pulmonary medicine and critical care, and 1,121 for gastroenterology
“New data out shows U.S. medical school graduates are choosing higher-paying specialties like cardiovascular disease, gastroenterology, and pulmonary disease and critical care medicine.”
Results and Data: Specialties Matching Service, 2025 Appointment Year February 13, 2025 https://www.nrmp.org/match-data/2025/02/results-and-data-specialties-matching-service-2025-appointment-year/
Milbank report: US Primary Care: 2025 Scorecard Report “The Cost of Neglect”: “Primary care, when achieving its full potential, has the capacity to enhance life expectancy, improve health outcomes, and lower health care costs. However, years of neglect and chronic underinvestment by the health care system have left US primary care in a position where it is increasingly unable to meet patients’ needs, particularly in rural and other underserved communities.
This combination of worsening primary care access and sicker patients has created a vicious cycle. Patients are driven to use more expensive services like emergency rooms, which raises health care costs and premiums, further reducing affordability and access…
- Financing: Declining investment and fee-for-service payment are hindering primary care clinicians’ ability to meet growing patient needs.
- Workforce/Access: Insufficient funding is diminishing the primary care workforce and access to care
- Training: Misdirected graduate medical education funding is not producing enough new primary care physicians, exacerbating access issues for patients
- Technology: The lack of investment in EHRs has led to burdensome systems that drain clinicians’ time, thereby reducing patient access to care
- Research: The lack of research dollars to study the practice of primary care is limiting evidence-based improvements in care
The federal research investment in primary care remains well below 1%, although spending increased marginally from 0.31% of total federal health care research budget in 2022 to 0.34% in 2023…
Jabbarpour Y, Jetty A, Byun H, Siddiqi A, Park J. The Health of US Primary Care 2025 Scorecard–The Cost of Neglect How Chronic Underinvestment in Primary Care Is Failing US Patients. Milbank Memorial Fund and The Physicians Foundation. February 18, 2025. https://www.milbank.org/publications/the-health-of-us-primary-care-2025-scorecard-report-the-cost-of-neglect/
Study: PE ownership impact of practice prices: “Consolidation of physician practices, largely driven by health systems, has motivated policy efforts to move care toward lower-price, non–health system settings. At the same time, however, private equity (PE) firms are increasingly acquiring those non–health system practices, potentially negating the prior price advantages of those practices. We used novel ownership data on gastroenterology practices linked to commercial claims for the period 2015–20 to study how PE acquisitions affect the prices and volume of care relative to both health system–affiliated practices and independent practices. We examined both professional fees and facility fees. After PE acquisition, prices increased by $92 per claim, or 28.4 percent, driven by a 78.1 percent increase in professional fees. Facility fees did not exhibit a statistically significant change. Meanwhile, utilization also increased. These findings suggest that PE firms have multiple avenues for raising prices—in this case, primarily via professional fees. For policy makers, although moving care out of higher-price health system settings remains a key strategy to lower spending, unchecked growth in professional fees in PE-acquired outpatient settings may nullify some of the intended effects.”
Increases In Physician Professional Fees In Private Equity–Owned Gastroenterology Practices Health Affairs February 2025 https://www.healthaffairs.org
Study: Physician turnover after PE sale: “In this case-control study of 1215 physicians, those in practices sold by PE owners were 16.5% more likely to work elsewhere within 2 years after the sale and 10.1 % more likely to join large (>120-physician) practices upon leaving than matched control physicians working in the same local markets and specialties in practices not sold by PE owners.
The increase in physician turnover and consolidation following PE exits has important implications for patients, physicians, investors, and physician markets, including disruption for practices and patients and likely for increases in costs of care.”
Sale of Private Equity–Owned Physician Practices and Physician Turnover JAMA February 14, 2025 https://jamanetwork.com
Population Health
CDC: Flu reason: In its latest report, CDC classified this flu season as “high-severity,” with estimates of at least 29 million cases, the most since the 2009-2010 season. “Seasonal influenza activity remains elevated and is higher than it has been all season:”
- CDC estimates that there have been at least 29 million illnesses, 370,000 hospitalizations, and 16,000 deaths from flu so far this season
- Nearly every state is reporting high or very high flu activity, with roughly 32% of tests coming back positive and some areas testing nearly 40% positive.
- Pediatric flu deaths hit a record 200 last year, and this season is shaping up to be worse.
Weekly US Influenza Surveillance Report: Key Updates for Week 6, ending February 8, 2025 https://www.cdc.gov/fluview/surveillance/2025-week-
