DOJ, FTC, and HHS jointly announced the launching of a cross-government public inquiry into increasing private equity and corporate involvement in health care, the latest announcement in a string of public statements from the federal government on the topic.

On March 5, 2024, the Department of Justice (“DOJ”), Federal Trade Commission (“FTC”), and Department of Health and Human Services (“HHS”) jointly launched a “cross-government public inquiry” into increasing private equity and corporate involvement in health care. As part of this inquiry, the federal government issued a Request for Information (“RFI”) that reflects the government’s stated concern that private equity transactions in the health care space “may lead to a maximizing of profits at the expense of quality care.” This is just the latest announcement in a string of public statements from the federal government regarding “private-equity and other corporations’ increasing control over health care.”

The government presents this inquiry and related RFI as a largely antitrust initiative and cites research showing that competition in health care provider markets promotes higher quality, lower cost health care, greater access to care, increased innovation, and better wages and benefits for health care workers. The information sought relates primarily to the consolidating effects of certain health care transactions carried out by private equity funds, alternative asset managers, health systems, and private payers.

The RFI centers around four key questions presented to various stakeholders: (i) how have covered consolidating transactions affected patients, employees, payers, and insurers; (ii) what were the stated and realized objectives of the covered transactions; (iii) what transactions have stakeholders viewed as notable; and (iv) what actions should the government take to address the covered transactions. The public may submit comments under the RFI until May 6, 2024.

For the last few years, multiple components of the federal government have issued statements reflecting the growing government focus on corporate involvement in health care. The RFI comes on the heels of other recent statements from DOJ leadership and the HHS Office of Inspector General calling out the growing prominence of private investment in health care, challenges by FTC against private equity consolidation strategies, and Senator Grassley’s scrutiny of private equity ownership in health care entities. These are only the more recent announcements, and the tenor and scope of the government activity point strongly toward further regulation and multipronged enforcement in the future. signaling further regulation and multipronged enforcement in the future.