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Senators investigate private equity giant KKR over nursing homes

Democratic senators are investigating private equity giant KKR over its care for people with disabilities, following a BuzzFeed News investigation that found dire conditions at a group housing company the company owns.

in a five page letter Sent Thursday, the senators asked the company to disclose any facilities that have violated state and federal laws, and any settlements reached with people in the company’s care. Senators Elizabeth Warren, Ron Wyden, Bernie Sanders and Patty Murray also demanded detailed financial information, including executive compensation and debt payments.

“We have long been concerned about the deleterious impact of private capital on health care and patient care,” the senators wrote. “Your company illustrates how private equity firms exploit the health care industry for profit at every stage.”

KKR is responsible for the care of thousands of people with disabilities through its ownership of BrightSpring Health Services, one of the largest group housing operators in the country. After its acquisition of BrightSpring in March 2019, KKR focused on expanding the business even as a crisis brewed in its group housing division, BuzzFeed News has discovered. Conditions got so bad that nurses and caregivers quit en masse, West Virginia barred the company from accepting new residents, and some of the most vulnerable people in their care suffered and died.

Overseen by KKR’s handpicked board of directors, BrightSpring executives in many cases kept salaries lower than those at competitor facilities or Walmart, despite pleas from local managers that they couldn’t. safely staff homes. Some managers resorted to making employees work three days in a row or threatened to arrest them if they tried to leave. At least three people have died after alarming failures in their care. One of them died after state authorities warned the company, twice, that it was in danger.

Neither KKR nor BrightSpring immediately responded to a request for comment on the Senate letter. In response to the BuzzFeed News investigation, BrightSpring I call the findings “inaccurate, misleading, and fundamentally flawed.” KKR issued a statement saying, “We vehemently disagree with the grossly misleading narrative he presented,” adding that he had invested $200 million per year in “quality first initiatives” and significantly increased compensation. The companies refused an official interview.

KKR and other private equity firms have transformed health care in recent years, quietly acquiring huge chunks of the sector, from entire hospital chains to addiction treatment centers and women’s health clinics. In 2021 alone, private equity firms invested about $172 billion, more than 10 times the CDC’s annual budget, in US health care companies, according to industry watchdog group PitchBook.

That expansion has drawn scrutiny from several lawmakers concerned that the corporate playbook — loading a company with debt, driving big profits, and quickly dumping the asset — has in some cases had devastating consequences for employees and individuals alike. who depend on these companies. services. Last year, for example, the Senate Finance Committee held a audience which examined deaths in privately owned nursing homes, and Warren, Wyden, and Senator Sherrod Brown started an investigation in the quality of care at the for-profit hospice companies owned by these companies.

Since the BuzzFeed News investigation was published, several other lawmakers have also raised concerns about the quality of care BrightSpring Health has provided under KKR ownership.

“Senator Manchin believes that reports about the conditions [in] BrightSpring Homes is disturbing and unacceptable,” said a spokesperson for the Democratic senator from West Virginia. State regulators became so concerned about conditions in the homes that they forced BrightSpring to stop accepting new customers, eventually reaching a settlement. settlement in which the company did not admit wrongdoing, but had to close or sell a fifth of its federally certified homes. “Senator Manchin and his team will continue to work with all parties involved to find a solution that ensures West Virginians receive the quality care they need and deserve.”

Rep. Richard Neal, Democratic chairman of the House Ways and Means Committee, said, “This is an extremely troubling report that underscores why I have long sought to bring greater transparency to the role of private capital in health care. via legislation, hearingsY petitions to the executive branch. More must be done to protect vulnerable Americans from harm in for-profit care facilities, and that’s why I’m continuing to push for greater responsibility in the industry.”

KKR has until June 2 to respond to Warren and other senators’ request for information.

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