Although private equity and venture capital firms have increased their investment in elderly care over the past five years, much of that investment has gone into home care and services, not homes. of retirement.
Home and community services and technologies are a major pocket of investment, along with Medicare Advantage primary care organizations, data shows reported by Axios.
Another draw for investors is models that use innovation to address health inequities.
Mitigating health inequalities is a low-hanging fruit for some investors and entrepreneurs, Robert Vorhoff, CEO of General Atlantic Told Axios. His company recently invested in Suvida Healthcare, which aims to provide a combination of home care and wellness services to Hispanic seniors.
“Where is the greatest potential for value creation? It’s about finding the people who have been least well served by the existing infrastructure,” he said.
Although the focus has been on retirement homes, a large portion of the $206 billion private equity firms spent on healthcare in 2021 involved eye care clinics, dental management claims, medical practices, hospices, pet care providers and other healthcare companies, according to Kaiser Health News report citing data from the PitchBook.
“Most of the innovations and new business models that have been developed have been about trying to keep people out of long-term care facilities,” Devin O’Reilly, managing director of Bain Capital, told Axios.
This comes at a time when care homes are coming under increased scrutiny. In February 2022, President Joe Biden promised that the practice of Wall Street firms buy nursing homes would end up on his watch.
However, the exact proportion of retirement homes that are privately owned is a matter of debate. Some industry analysts say that the term “private equity” is used too loosely and that only a small percentage of facilities are owned by private equity, as most large private equity firms have divested these assets.