Leo Sher, M.D.

A research report, “Private equity among US psychiatric hospitals” has recently been published in JAMA Psychiatry (1). Researchers from Missouri and Connecticut studied trends in private equity ownership of psychiatric hospitals from 2013 through 2021 and the cross-sectional association between private equity ownership and hospital staffing and quality

The authors compared characteristics of 87 private equity-owned psychiatric hospitals in 2021 with 530 non–private equity-owned psychiatric hospitals. Regression models were used to estimate adjusted differences in hospital staffing and quality. Participants included all Medicare-participating freestanding psychiatric hospitals in the US (N = 617).

The authors report that main outcomes were staffing ratios, national quality measures (restraint and seclusion rates, 7- and 30-day follow-up rates, post discharge medication continuation, and 30-day all-cause readmission rates). Other studied characteristics included institutional characteristics (region, number of beds), services provided, measures of case mix (populations served, hospital average Diagnosis Related Group score among Medicare beneficiaries), occupancy rates, and average length of stay.

By 2021, of the 617 freestanding psychiatric hospitals in the US, 87 (14.10%), representing 4660 beds (6.30%), were private equity owned. Two-thirds of private equity-owned facilities were in the southern US (63.22%). In adjusted models, private equity ownership was associated with significantly lower staff per patient day among registered nurses and medical social workers. However, private equity-owned facilities performed better on quality measures, including lower reported hours of restraint use, 30-day readmissions, and higher 7-day and 30-day follow-up visits.

Reference

1. Shields MC, Yang Y, Busch SH. Private equity among US psychiatric hospitals. JAMA Psychiatry. 2025 Jul 1;82(7):701-708. doi: 10.1001/jamapsychiatry.2025.0689.