Quorum Health Resources
Provided management and consulting services to hospitals and healthcare systems.
PE-OWNED
Acquired by TPG Capital2013-04-01
What Made It Great
Leading provider of hospital management services to independent facilities
What PE Will Likely Do
Quorum Health Resources will likely experience significant staffing reductions, with nursing staff being replaced by lower-cost licensed practical nurses (LPNs) or nursing assistants to cut labor costs.
Quorum is likely to sell hospital real estate and lease it back, extracting equity for the PE firm's investors while potentially leading to higher facility costs passed on to patients.
Quorum may aggressively upcode medical procedures and diagnoses to maximize reimbursements, leading to higher healthcare costs for patients and insurance providers.
Quorum is likely to eliminate unprofitable but essential services like psychiatric care or rural hospital services in order to focus on more profitable lines of business.
Quorum will likely extract significant management and consulting fees from the hospitals it manages, potentially reducing resources available for patient care.
Expected Timeline
“0 to 6 months months”
Quorum will likely announce cosmetic changes, 'optimization' programs, and a leadership shuffle as the PE firm takes control.
“6 to 12 months months”
Staffing cuts will begin under the guise of 'efficiency' programs, and Quorum will start reviewing its service lines for potential cuts.
“12 to 24 months months”
Patients will likely notice a decline in service quality, with longer wait times and reduced access to certain healthcare services.
“24 to 36 months months”
Significant issues may emerge, including the closure of certain hospital departments and potential quality scandals.
“36+ months months”
Quorum may face bankruptcy, hospital closures, or a fire sale to another operator as the PE firm's cost-cutting strategies take a toll on patient care.
Similar Cases
Other companies that followed a similar path after PE acquisition
What You Can Do
Actions
Patients of Quorum-managed hospitals should closely monitor any changes in staffing, service offerings, and billing practices, and be prepared to advocate for their healthcare needs.
Consumers should research alternative healthcare providers in their area that may not be under PE ownership, in order to maintain access to quality care.
Patients should stay informed about the performance and financial stability of Quorum-managed hospitals, and be ready to voice concerns to local authorities or regulatory bodies if service quality declines.
Alternatives
Community-focused healthcare
Integrated managed care consortium