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Shining a light on PE ownership.

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Providence Service Corporation

healthcare
PE-OWNED

Provides home and community-based healthcare services to government programs.

PE-OWNED

Acquired by Bain Capital2018-02-01

View PE Firm Profile

What Made It Great

“

Leading provider of non-emergency medical transportation and home healthcare services

What PE Will Likely Do

Predictions

Staffing cuts, with fewer registered nurses (RNs) and more licensed practical nurses (LPNs) or nursing aides providing care

HIGH LIKELIHOODBased on: Bain Capital's track record of cost-cutting and operational efficiency tactics, which have frequently led to declines in service quality and customer harm in the healthcare industry

Real estate sale-leaseback transactions, leading to potential service cuts or facility closures in less profitable geographic areas

HIGH LIKELIHOODBased on: The common private equity playbook in the healthcare sector, including staffing reductions, real estate transactions, billing upcoding, and service line cuts

Aggressive billing practices, such as upcoding for higher-reimbursement procedures and diagnoses, leading to potential billing disputes and denials for customers

HIGH LIKELIHOODBased on: The specific nature of Providence Service Corporation's business, providing critical healthcare and transportation services to vulnerable populations, which are at risk of being impacted by private equity cost-cutting measures

Elimination of unprofitable but essential services like psychiatric care or rural transportation, reducing access to critical healthcare and transportation options for vulnerable populations

HIGH LIKELIHOODBased on: The specific nature of Providence Service Corporation's business, providing critical healthcare and transportation services to vulnerable populations, which are at risk of being impacted by private equity cost-cutting measures

Expected Timeline

Phases
0-6 monthsCompleted

“0 to 6 months months”

Announcements of 'optimization' and leadership changes, with little immediate impact on service quality

6-12 monthsYOU ARE HERE

“6 to 12 months months”

Staffing reductions and service reviews begin, leading to longer wait times and potentially reduced quality of care

12-24 months

“12 to 24 months months”

Significant declines in service quality, with longer wait times, reduced access to specialized services, and potential patient safety issues

24-36 months

“24 to 36 months months”

Major service cuts or facility closures, leading to healthcare and transportation deserts in certain communities, as well as potential quality scandals or patient harm

Similar Cases

Other companies that followed a similar path after PE acquisition

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Steward Health Care

Cerberus Capital Management·2010

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Envision Healthcare

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US Dermatology Partners

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Hahnemann University Hospital

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Sound Physicians

Summit Partners·2019

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What You Can Do

Take Action

Actions

  • Monitor any changes in the availability, quality, and pricing of healthcare and transportation services provided by Providence Service Corporation

  • Advocate for maintaining essential services and access to care, especially in underserved communities

  • Report any significant declines in service quality or patient safety issues to regulatory authorities and consumer advocacy groups

Alternatives

Non-profit health systemsSAFE

Community-focused healthcare

Kaiser PermanenteSAFE

Integrated managed care consortium

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"Providence Service Corporation is now PE-owned. Here's what that means for you."