☕️ PE or P-Eek?

06-20-2024

Private equity money is abundant in the behavioral health industry.
Morning Brew June 20, 2024

Healthcare Brew

FinanceBuzz

Warning! If you’re reading this newsletter on your phone in between scrolling social media, take heed: US Surgeon General Vivek Murthy called on Congress to require a safety label on social media platforms that warns users of the potential impact on mental health, particularly for children.

In today’s edition: 

Do you mind?

Completely spent

—Cassie McGrath, Maia Anderson

PRIVATE EQUITY

Interesting behavior

Image depicting mental health in the shape of a heathcare cross Francis Scialabba

Private equity (PE) is all over healthcare, with investment firms owning more than 400 hospitals around the US. But as the country faces a mental health crisis—US Surgeon General Vivek Murthy called it the “the defining public health crisis of our time”—PE has its sights set on one of the fastest-growing areas of the industry: behavioral health care.

PE has accounted for over 60% of all behavioral health deal flow since 2018, and firms like Thurston Group and Five Points Capital now own about a quarter of facilities offering behavioral health care in some states, according to a recent cross-sectional study published in JAMA Psychiatry.

A report by the nonprofit Private Equity Stakeholder Project (PESP) found that in 2023, there were 1,135 unique deals in healthcare involving 675 PE firms, business development corporations, venture capital firms, private credit funds, and other investors.

PESP reported that there were 44 behavioral health-specific deals in 2023. ARC Health—a behavioral health company backed by Thurston Group and Five Points Capital—made nine acquisitions in 2023, accounting for 20% of all behavioral health deals that year, according to PESP.

The interest in behavioral health comes as the need for such services has boomed.

Keep reading here.—CM

   

PRESENTED BY FINANCEBUZZ

Rare unlimited cash-back match turns heads

FinanceBuzz

If you have outstanding credit card debt, getting a new 0% intro APR credit card could help ease the pressure while you pay down your balances. On top of all that, this top credit card offers an up to a whopping 5% cash-back perk that gets matched after your first year. That's up to 10% back on qualifying purchases in your first year! Click through to see what all the hype is about. Take advantage of this offer—learn how to apply now.

DIRECT CARE

Money pit

stacks of cash Francis Scialabba

The US shells out so much cash for healthcare that it makes Jeff Bezos’s eccentric hobby budget seem like a paragon of restraint. And it looks like we’re only going to be spending more in the coming years.

With a record number of people insured and seeking healthcare services post-pandemic, US health spend growth is outpacing GDP growth, and is expected to keep doing so through 2032, according to a June 12 report from actuaries at the Centers for Medicare and Medicaid Services (CMS).

By 2032, CMS actuaries project healthcare spending will total $7.7 trillion and make up 19.7% of total US GDP, compared to $4.8 trillion and 17.6% of GDP in 2023.

Break it down

CMS actuaries estimate total US health spending grew 7.5% in 2023, due in part to the fact that an “unprecedented” 93.1% of the population was insured. That spike in coverage was largely thanks to federal policies allowing beneficiaries to stay on Medicaid through the public health emergency.

In comparison, nominal GDP grew 6.1%. This marks the first time health spend growth has outpaced GDP growth since 2020.

Keep reading here.—MA

   

TOGETHER WITH ZORO

Zoro

Safety starts here. It’s Safety Month and summertime, which means cooling solutions are top of mind. With tools like thermostats and roof ventilators, Zoro’s vast lineup of products helps healthcare businesses stay properly equipped to prevent safety hazards. Stock up on Zoro.com for success during summer + beyond.

VITAL SIGNS

A laptop tracking vital signs is placed on rolling medical equipment. Francis Scialabba

Today’s top healthcare reads.

Stat: 50%. That’s the share of US military bases located in healthcare deserts. (NPR)

Quote: “It’s assumed that women’s biology doesn’t matter and that women who are premenopausal and those who are postmenopausal respond similarly.”—Stephanie Faubion, director of the Mayo Clinic’s Office of Women’s Health, on older women being left out of medical research (the Washington Post)

Read: Anthony Fauci gives an inside look at the early days of the government’s response to Covid-19. (The Atlantic)

Your secret weapon at work: Crush it at work with Per My Last Emaila podcast full of smart, funny insights about navigating your career.*

*A message from our sponsor.

JOBS

Stop waiting for your dream job to find you. CollabWORK puts you in front of the right opportunities in the online spaces you frequent. Get discovered by top companies and take control of your career path.

SHARE THE BREW

Share Healthcare Brew with your coworkers, acquire free Brew swag, and then make new friends as a result of your fresh Brew swag.

We're saying we'll give you free stuff and more friends if you share a link. One link.

Your referral count: 0

Click to Share

Or copy & paste your referral link to others:
https://www.healthcare-brew.com/r?kid=9d15c7a7

         
ADVERTISE // CAREERS // SHOP // FAQ

Update your email preferences or unsubscribe here.
View our privacy policy here.

Copyright © 2024 Morning Brew. All rights reserved.
22 W 19th St, 4th Floor, New York, NY 10011
Respond To Email