Report: Privatization of EMS Services Diminishes Quality of Care

Private equity firms have gotten into the business of providing ambulance and other first-responder services and often fall short when compared to public agencies, The New York Times has reported. Numerous ambulance and fire agencies acquired by private equity firms, the Times reported, are aimed at making a profit from emergency calls while cutting costs and increasing prices.

As reported in the New York Times:

Unlike other for-profit companies, which often have years of experience making a product or offering a service, private equity is primarily skilled in making money. And in many of these businesses, The Times found, private equity firms applied a sophisticated moneymaking playbook: a mix of cost cuts, price increases, lobbying and litigation.

In emergency care and firefighting, this approach creates a fundamental tension: the push to turn a profit while caring for people in their most vulnerable moments.

For governments and their citizens, the effects have often been dire. Under private equity ownership, some ambulance response times worsened, heart monitors failed and companies slid into bankruptcy, according to a Times examination of thousands of pages of internal documents and government records, as well as interviews with dozens of former employees. In at least two cases, lawsuits contend, poor service led to patient deaths.

Of the 12 ambulance companies recently owned by private equity, three filed for bankruptcy in the last three years, according to public filings and S&P Global Market Intelligence, a research service that tracks over 1,100 major ambulance companies in the United States. Those three companies had problems that predated private equity. But no other ambulance company tracked by the research firm filed for bankruptcy during that period.

While private equity firms have always invested in a diverse array of companies, including hospitals and nursing homes, their movement into emergency services raises broader questions about the administering of public services. Cities and towns are required to offer citizens a free education, and they generally provide a police force, but almost everything else is fair game for privatization.

“We’re reaching new lows in the public safety services we will help provide, especially in very poor cities,” said Michelle Wilde Anderson, a law professor at Stanford University who specializes in state and local government. Private equity firms, she said, “are not philanthropists.”

For more information read the full article in the New York Times.