I'm a capitalist. I believe in the free market and as an entrepreneur I make my living off it. I make no apologies. My company, Fisher Vista, LLC will soon be launching a new service for the "senior" marketplace called SeniorCareMarketer . We hope to profit from the aging of America. But it's not profiting at the expense of any individual, group or institution. We believe we will be offering a valuable service and in return we hope to make a fair profit. And if we do, we of course will give some back in the form of charitable donations.
But what concerns me about the "business of aging" is the delicate balance between making a buck and caring for an individual's wellbeing. It's been a challenge for all health care companies - you want to be sure every individual gets the care they need but at the same time, you need to turn a profit to keep offering the valuable products / services you provide. Some companies like Johnson and Johnson have balanced this dichotomy remarkably well.
But the growing interest from Private Equity firms in senior care does concern me. Why? Because private equity is all about making money for the private equity firm, major shareholders and selected other Wall Street institutions - typically in a five year period in order to have a highly profitable liquidity event. And for some reason, this seems especially wrong in the senior care marketplace where any cuts in services do not just hurt "customers" but directly impact people's health and lives. You cannot take a short term view in senior care.
The New York Times recently ran a story called At Many Homes, More Profit and Less Nursing where they analyzed trends at nursing homes purchased by private investment groups. The Times examined more than 1,200 nursing homes purchased by large private investment groups since 2000, and more than 14,000 other homes. The analysis compared investor-owned homes against national averages in multiple categories, including complaints received by regulators, health and safety violations cited by regulators, fines levied by state and federal authorities, the performance of homes as reported in a national database known as the Minimum Data Set Repository and the performance of homes as reported in the Online Survey, Certification and Reporting database.
It's a fascinating article in a series called Golden Opportunities where the NYT examines how businesses and investors seek to profit from the soaring number of older Americans, in ways helpful and harmful.
Comments