Reliant Rehabilitation
Provides contract rehabilitation therapy services to hospitals and nursing facilities.
PE-OWNED
Acquired by Warburg Pincus2014-08-01
What Made It Great
Leading provider of contract therapy services with strong clinical outcomes
What PE Will Likely Do
Reliant Rehabilitation will likely experience a reduction in skilled nursing staff, with more lower-cost licensed practical nurses (LPNs) and nursing assistants instead of registered nurses (RNs) providing care.
Reliant may sell and lease back its rehabilitation facility real estate, extracting equity for Warburg Pincus while increasing facility lease costs.
Reliant may increase the use of 'upcoding' tactics to bill for higher-reimbursement procedures and diagnoses, even if they don't fully align with the care provided.
Reliant may choose to eliminate unprofitable but essential rehabilitation services like those for psychiatric patients or in rural areas.
Reliant will likely charge large management and consulting fees to the acquired facilities, reducing the resources available for direct patient care.
Expected Timeline
“0 to 6 months months”
Reliant will likely announce leadership changes and 'optimization' programs, but any changes to care quality may not be immediately noticeable.
“6 to 12 months months”
Staffing reductions under the guise of 'efficiency' programs will begin, leading to longer patient wait times and potentially reduced therapy time per patient.
“12 to 24 months months”
Patients and facility partners will start to notice a decline in service quality, with reduced access to skilled nursing care, longer wait times, and potentially the elimination of certain rehabilitation services.
“24 to 36 months months”
Significant issues may emerge, such as the closure of certain rehabilitation departments or quality scandals related to the changes implemented by Warburg Pincus.
“36+ months months”
Reliant Rehabilitation may face the risk of bankruptcy or a fire sale to another operator if the cost-cutting measures severely impact patient outcomes and facility partnerships.
Similar Cases
Other companies that followed a similar path after PE acquisition
What You Can Do
Actions
Patients and facility partners of Reliant Rehabilitation should closely monitor changes in staffing levels, therapy time per patient, and the availability of specialized rehabilitation services.
Patients should be vigilant for any signs of upcoding or billing irregularities and should advocate for maintaining high-quality care.
Facility partners should closely scrutinize any proposed changes to real estate arrangements or management fees, and be prepared to explore alternative therapy service providers if Reliant's quality declines.
Alternatives
Community-focused healthcare
Integrated managed care consortium