Private-Equity Owned Home Care Provider Abruptly Leaves 1,100 Clients Without Services

HUNTSVILLE, Ala. – When Help at Home abruptly left Alabama last fall, nearly 800 caregivers were gone, leaving 1,100 older and disabled clients in need of replacement of services. The company cited the challenging “reimbursement and regulatory environment” in the state as the reason for its departure. According to Kristen Trenaman, the company’s vice president of public relations, the issue was in recruiting and retaining enough workers.

Debra Davis, deputy commissioner for the Alabama Department of Senior Services, mentioned that Help at Home’s departure had a significant impact, prompting state agencies to quickly find new caregivers for those who relied on the company. The private equity-owned company has continued to provide in-home and community-based care in other states, with 49,000 caregivers and 66,000 monthly clients.

The departure of Help at Home has raised concerns about the impact of private equity investment in health care, with critics warning about reduced quality of care, increased costs, and limited access for patients in less regulated industries such as home care and hospice care. Mary Bugbee, from the Private Equity Stakeholder Project, expressed concerns about the influence of private players in determining the quality and access to healthcare services.

The increasing demand for home health care has also attracted private equity firms, with the aging population fueling favorable demographic trends in the industry. Ankeet Patel, a vice president at private equity firm Shore Capital Partners, highlighted the opportunity presented by the aging population’s preference for home-based settings for receiving care.

The financial implications of private equity ownership were also brought to light, particularly the piling on of debt to finance additional purchases or to pay investors dividends. This high level of debt can leave a company financially vulnerable and more likely to cut less profitable services, ultimately impacting the quality of care and access to services.

The potential for regulations to address private equity’s involvement in the healthcare industry has been discussed, as state and federal laws have been introduced to improve transparency, protect patients and workers, and regulate major financial transactions within the industry. Efforts to enforce such laws, including notification of financial transactions and increasing minimum wages for healthcare workers, have been seen in states like California and New York.

The departure of Help at Home from Alabama and the broader issues surrounding private equity ownership in the healthcare industry serve as an important reminder of the potential impact on patient care, access to services, and the financial stability of healthcare providers. The ongoing discussion about private equity’s role in healthcare regulation and the need for transparency and protective measures highlights the complexities and challenges faced by the industry.