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Shining a light on PE ownership.

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BA

BayMark Health Services

healthcare
PE-OWNED

A provider of outpatient treatment services for opioid addiction and substance abuse.

PE-OWNED

Acquired by Bain Capital2017-03-01

View PE Firm Profile

What Made It Great

“

Specialized addiction treatment with medication-assisted therapy

What PE Will Likely Do

Predictions

Reduction in nursing staff and replacement with less qualified personnel like LPNs and aides to cut labor costs

HIGH LIKELIHOODBased on: Bain Capital's history of aggressive cost-cutting tactics in acquired companies, including staffing reductions and real estate monetization

Sale-leaseback of BayMark's treatment facility real estate to extract equity for investors

HIGH LIKELIHOODBased on: Common private equity playbook in healthcare, including billing upcoding, service line cuts, and management fee extraction

Aggressive upcoding of billing to increase reimbursements, potentially leading to fraudulent practices

HIGH LIKELIHOODBased on: Precedents of private equity-owned healthcare companies filing for bankruptcy or being sold at a loss after quality and access issues

Elimination of unprofitable but essential services like psychiatric care or rural addiction treatment programs

HIGH LIKELIHOODBased on: Precedents of private equity-owned healthcare companies filing for bankruptcy or being sold at a loss after quality and access issues

Significant management and consulting fees charged to BayMark by Bain Capital, reducing funds available for patient care

HIGH LIKELIHOODBased on: Precedents of private equity-owned healthcare companies filing for bankruptcy or being sold at a loss after quality and access issues

Expected Timeline

Phases
0-6 monthsCompleted

“0 to 6 months months”

Announcements of 'optimization' and leadership changes, but no visible impact on patient care yet

6-12 monthsYOU ARE HERE

“6 to 12 months months”

Staffing cuts begin, patients start experiencing longer wait times and reduced time with clinicians

12-24 months

“12 to 24 months months”

Quality of addiction treatment services noticeably declines, including shorter therapy sessions, less personalized care, and inconsistent medication management

24-36 months

“24 to 36 months months”

Potential closure of rural treatment facilities, reduction in medication-assisted therapy options, and patient safety incidents due to staffing and equipment issues

36+ months

“36+ months months”

Possible bankruptcy or fire sale of BayMark to another operator, further disrupting access to critical addiction treatment services

Similar Cases

Other companies that followed a similar path after PE acquisition

Operating

Steward Health Care

Cerberus Capital Management·2010

See full case study
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Envision Healthcare

KKR·2018

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US Dermatology Partners

Ares Management·2016

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Hahnemann University Hospital

Cerberus Capital Management·2018

See full case study
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Sound Physicians

Summit Partners·2019

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What You Can Do

Take Action

Actions

  • Closely monitor any changes in the quality, availability, and staffing of BayMark's addiction treatment services

  • Be aware of potential billing issues or changes in medication-assisted therapy options

  • Advocate for continued access to essential addiction treatment services, especially in rural areas

  • Consider seeking care from other providers if BayMark's quality of service significantly declines

Alternatives

Non-profit health systemsSAFE

Community-focused healthcare

Kaiser PermanenteSAFE

Integrated managed care consortium

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"BayMark Health Services is now PE-owned. Here's what that means for you."