Private Equity Is Now Dominating the US Hospice System | Hacker News Reader

Private Equity Is Now Dominating the US Hospice System

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228 pointspessimizer243 comments

Pretty much every facet of any business that deals with the elderly is an attempt to siphon off any wealth they have, and then any benefits they may qualify for, before they die. This includes healthcare, retirement communities, assisted living, nursing homes, hospice, AARP, long-term care insurace, all of it. Stay as far away as you can.

It's literal vulture capitalism: not just content to extract value by liquidating the needs of society, but to extract from dying people.

Also, illness in the US is still the number 1 cause of bankruptcy. Only America thinks so little of people that they threaten the dying with destitution and homelessness.

> Only America thinks so little of people that they threaten the dying with destitution and homelessness.

Americans are, for the most part, a kindly and trusting people, happy to help out complete strangers.

America is a shit show run by sociopaths.

It is important to disambiguate these two things.

Or rather, admittedly from an European POV, Americans seem to be kindly, trusting and helpful towards members of their own sub-group, and quite the contrary to those they deem "lesser" in status - the poor, the disabled, people of color.

That makes it all the easier for rich vultures to pit Americans against one another - to the tune of it being the subject of a very valid joke:

> A banker, a worker, and an immigrant are sitting at a table with 20 cookies. The banker takes 19 cookies and warns the worker: "Watch out, the immigrant is going to take your cookie away."

> Americans seem to be kindly, trusting and helpful towards members of their own sub-group, and quite the contrary to those they deem "lesser" in status - the poor, the disabled, people of color.

As a European, I can assure you we share these traits. Try asking one how they feel about local Romani, African or Syrian refugees, foreign beggars, etc.

Or about inherited wealth. America at least has better social mobility, for now.

Absolutely not. The US doesn't even make the top 20.

https://www.weforum.org/reports/global-social-mobility-index...

https://en.wikipedia.org/wiki/Socioeconomic_mobility_in_the_...

its a common misconception, since that was sold to the public for the last 100+ years.. but not, actually, the demographics in recent decades show less social mobility overall, as compared to other developed nations in the same time periods..

source: Pew research reports and other

Social mobility requires a society that allows you to fail but stil pick you up afterwards. America doesn’t.

No, social mobility does not need that. And no, America has some (imperfect, but quite wide) social safety net.

https://en.wikipedia.org/wiki/Social_mobility https://en.wikipedia.org/wiki/Social_safety_net

> and quite the contrary to those they deem "lesser" in status - the poor, the disabled, people of color.

At least it is better than Europe which spent the first few decades of the 1900s exterminating them by the millions.

Even now, Europe won’t allow foreigners to assimilate. Name any major EU company led by a non-white person. Even today at football games all over Europe, non-white players are openly subjected to horrific racial abuse by the crowds.

Europe is still horribly racist towards any outsiders. Yet, living in their ethnically homogeneous countries they cast stones at the USA which has actually assimilated and welcomed people from all over the world.

It’s wild seeing US centric and Euro centric povs. How do both sides not see the problem with the Global North as a whole. The lack of self awareness between the Great Powers is interesting.

> ethnically homogeneous countries

Wut? Europe is anything but ethnically homogenous.

The US is anything but welcoming now. It might have been in the past.

> Wut? Europe is anything but ethnically homogenous.

You are right. I forgot how diverse countries like Belgium are where Flemish, French, and German communities (whose ancestors all likely were born within a few hundred miles of each other) all live together in peace and harmony (other than when they try to form a government)

I think you have a slightly different impression of Europeans than me.

We mildly dislike all the other nationalities (except the French, everyone hates the French), but we have a few thousand years of history fighting each other and it just doesn’t seem worth the effort any more.

All of that falls to nothing compared to the dislike some people have for the European version of the Mexicans stealing our jobs (hence, far right populism in Europe rising sharply right now)

Never mind that none of the ethic Europeans wants to do those jobs in the first place. I’m sure we’ll figure it out in 100 years or so. When everyone will be some variety of brown/yellow/pink.

> Name any major EU company led by a non-white person.

Shell (nominally UK but founded and well known as Royal Dutch Shell) is the largest EU(ish) company, headed by Lebanese-Canadian Wael Sawan.

Exor (Italy/Netherlands) is #10, headed by Indian Ajaypal Singh Banga.

Please, check your facts before making prejudicial claims again. And don't try "No True Scotsman" because it would just be too funny in this context.

The UK, one of the largest European countries, is led by someone from Indian descent.

Not EU (and I'm British so I'll stick to the UK), but:

* Rishi Sunak is literally our Prime Minister.

* Sadiq Khan is the Mayor of London.

* Wael Sawan, the CEO of Shell, the biggest UK company, is Lebanese.

* C. S. Venkatakrishnan is the CEO of Barclays, HQ'd in London and one of the worlds biggest banks.

* Johnny Boufarhat is the founder of Hopin, an online meetings platform that exploded during COVID. While it's in some trouble now and I'm not a fan, Johnny's parents are Lebanese and Syrian, although he's from Australia.

Seriously dude, this stuff isn't hard to find. What kind of warped vision do you have of Europe here?

I've worked in the UK for decent stints of time.

As a brown guy, I have definetly faced much more microaggressions and "do you belong here" type conversations in the UK than I ever have growing up and working in the US.

Your comment is the equivalent of saying "Obama was president, blacks don't face racism anymore".

My comment was a very specific answer to the line:

> Name any major EU company led by a non-white person

(although the UK is no longer in the EU)

I meant nothing else other than answering that line.

If anything, take it up with parent comment, someone who believes non-white people are incapable of running large companies in Europe.

Fair enough!

In my experience it is the opposite. Americans give about 3x as much per capita to charity as Germans, for example. In continental Europe generally you will also see strong anti-immigrant and anti-minority sentiments expressed in casual, middle class society that I haven’t seen to anywhere near the same degree in the U.S.

The real pisser: the overwhelming majority of those "charities" are either fundamentalist religious organizations with deeply troubling agendas or thinly camouflaged tax shelters for the obscenely wealthy. Ain't that a kick in the head?

A huge fraction of that charity is donations to the church one is a member of, much of which money goes to church salaries, property maintenance, etc. If we included country club dues and gym memberships in the German charity numbers, perhaps the "charitable giving" numbers would be closer.

Donations to religious organizations were about 28% of donations in the U.S. If you excluded all of the charitable donations to churches, the U.S. numbers would still be more than twice as much as Germany.

Also, while a large part of the religious donations go to the operation of the church, churches do a lot of other charitable activities such as food pantries, shelters, disaster relief, education, etc.

Having lived in both places, charity is simply much more of a part of the culture in the U.S. I think the general feeling in Germany was that taking care of people in trouble was the job of the government and that they paid their taxes and that doing more was not necessary.

That's definitely a case that can be argued.

Social problems often make more sense to attack at a governmental level.

When you have a patchwork of different charitable initiatives, often regionally bounded, they can easily fall victim to tunnel vision. You end up with solutions like "we solved the poor care metrics in Facility A by shipping the worst cases to Facility B" and then nobody's checking if Facility B is actually worse.

Individual charity also tends to have the problem of awkward consumer choices. well-marketed and mediagenic causes out-raise less appetizing ones that might produce more impact for the same investment. Getting this information into the hands of a few professional analysts and budgeters may be easier than trying to run a broad PR campaign.

That’s funny, when we look at Europeans we see the same thing.

Europeans freak out at levels of immigration that are normal in the US.

To be fair lots of European countries have immigration levels comparable to or greater than the US, although a sizeable amount of those immigrants are other Europeans. And it's not like the US "build the wall" isn't also having a moment.

If we are being real, isn't the banker probably from Europe though?

Americans are on average selfish, vulgar, greedy, indifferent to injustice, indifferent to suffering, and racist.

We like to say shit on social media and occasionally throw a tiny minority of our money and none of our time at the most visible problems resulting in parasites specializing in appearing to do useful things while mostly paying people with degrees to think about helping people.

This is why we have people dying for lack of medicine, starving kids, and stories of that random teacher whose humiliation made the rounds on social media who people raised 80k for that one time in place of systemic solutions.

America is run by the kind of folks the disreputable folks discussed above would vote for.

As a counterpoint, though, is the very idea of running a business providing end-of-life care evil? It’s not like there’s a government program you can use.

The traditional providers of end-of-life care for most of history were called your own children. This has changed over the last 75 years or so and now people are upset that the cost of providing messy, high stress, praiseless, 24/7 work costs a lot of money.

Yeah and failing that you were just destitute. Let's not act like that always worked out so great or is a serious solution for today's problems.

It's not the solution necessarily but income equals expenditure. They're one and the same. People need to stop pretending that the true cost of hospice care is much cheaper than what's charged today. Look at what non-profits charge. It's still eye watering sums, and not much different than investor owned hospice care quotes.

Your greatest hint into the fact that end of life care genuinely costs a lot is that LTC insurers keep going bankrupt. Insurance companies don't like going bankrupt.

It doesn't cost nearly as much as they charge though. Otherwise, private equity wouldn't be getting involved.

Look up the prices charged by non-profit hospice care. It's not much different from investor owned hospice care.

But is the staffing and standard of care different? Do the patients of investor owned hospices suffer with a higher incidence of bed sores? Do they suffer longer?

The article suggests the nonprofits are getting sicker patients the for-profits don't want to take.

Accurate, and it does nothing to address the central issue, namely someone is making a fucking killing off of individuals at their most vulnerable.

Unless they are defrauding these people, I don't see the issue in profits off of hospice. Hospice availability is a huge issue. The only thing worse than paying a lot for hospice is not getting hospice because there are no vacancies. If the profit incentive to run a nursing home or palliative care facility were eliminated, supply would fall through the floor creating a bigger issue than someone having the gall to earn money.

And supply would fall because no one is doing this sort of work out of the goodness of their own hearts, unless they are religious. And there are quite a few religious facilities out there but the numbers are dwindling.

When the simple majority of Americans are priced out of this kind of care from bloated profit margins how does that differ substantively from a lack of vacancies? While you're grappling with that here's another one: Mondragon and it's constellation of affiliate co-ops rather soundly puts the lie to the notion that profit motive is the sole driver of human activity. Apparently the world isn't entirely populated by sociopaths so it's still possible to get shit done without making a handful of individuals grotesquely wealthy in the process.

Mondragon is absolutely a for-profit, money-motiviated firm. It doesn't do things for free. The difference is that the shareholders are the employees rather than investors.

There is nothing illegal about starting a co-op, but in practice they are quite difficult because of the capital needed up front to start a business. That is to say, it's much easier to ask a VC for $5 million in series A funding than it is for the 10 devs running the thing to put up $500,000 each of their own money.

You're pretending financial institutions don't exist (business loans are absolutely a thing) and that all forms of profit-taking are ethically equivalent. What, exactly, are you stanning here?

I thought that the nursing home charged an outrageous amount for the care of my father. So I invested in nursing home stocks. I lost a chunk of money, they turned out to be lousy investments.

If they are making fabulous profits, I'm not seeing it in the stock performance.

It seems like the PE firms are squaring this circle by offering diminished services, turning away sicker patients, and so on, or that's what the article says.

Actually I would guess that it is pretty expensive to run. You need the staff fulltime there and then the space and often equipment.

Just doing the math of staff to patients, takin in account that you need full time support. It starts to add up.

I don’t think that’s in serious dispute, but it also seems obvious that PE forms wouldn’t touch it if they didn’t see a way to make money.

These places are often operating with ratios like 30 patients under the care of a single nurse making $30k a year. They will charge the state $12k a month for the service.

They charge a high price because what is the state going to do, NOT put people in an old age home when they have no where else to go? It's a completely captured market, because the government isn't allowed to run it's own system, because that would be "socialism" and "death panels".

I don’t think history supports this thesis. Most children went away to the cities or other countries or even other continents. Maybe if you where one of the fewer and fewer people who still had a farm you might have one child taking it over, but if you were born in a city then that’s obviously not possible.

I guess it might be possible you moved to where one of your children lived, if you even knew where they ended up.

You are describing last 100 years of US history and it is not "most of the history". What you are describing was still not prevalent through the world like 50 years ago.

This is very very recent North America-and-other-settler-colony history. Even today, most Americans live within 20 miles of their parents. Most people don't live in different settlements to their parents, let alone cities, let alone countries, _let alone_ continents.

And yet we still have hospice care. It is almost like just saying your adult children should take care of it isn’t an adequate solution.

Most of the "solutions" in history were to just let unfortunate people suffer and look away while they cry out.

First line for elder care was, and still is, spouses. Usually one needs care before the other.

And perhaps more importantly community.

> As a counterpoint, though, is the very idea of running a business providing end-of-life care evil? It’s not like there’s a government program you can use.

The distinction between a for-profit business and a nonprofit is relevant here.

I guess so, though my own experience in the nonprofit sector has made me a little skeptical of how big the difference really is in many cases. In many instances I feel nonprofits end up acting like cat's paws for their donors. May not apply to hospice care.

The nonprofit hospice I - and a few people I know - have dealt with a few times over the years has an excellent reputation and lives up to it. I'm not familiar with all their operations, obviously, but I don't think it could even function as a branch of a large for-profit corporation, let alone as part of the government.

> In many instances I feel nonprofits end up acting like cat's paws for their donors. May not apply to hospice care.

There are ways I could see a hospice service getting fucked up in that way, by influence wielded by its donors (if a large amount of donations came from a single religious sect that wanted to impose its ways on end of life care, or something) but the difference is that I'd view a large for-profit corporation fucking it up as inevitable. The use of a benefit corporation might help with that, possibly, with the right leadership.

Not that relevant. Nonprofit healthcare is simply a tax structure.

Capitalism is always vulture capitalism.

Life was so much better in the Soviet Union that they had to build a wall around it and shoot people who tried to escape to capitalism.

There are clearly only two options: capitalism or dictatorship. Nothing else is possible. American capitalism is given by God and the best of all possible worlds. Yes sir.

What did AARP do?

Serve as a trusted name conduit for a lot of shady products.

Having seen what happens to the elderly, barring trustworthy family which live close by to keep a close eye on them - everyone around such older folks is trying to actively exploit them. It's disgusting.

I had a friend whose incredibly senile grandmother got taken for a few hundred grand by scammers. Neighbors talked her into selling her cars to them for a dollar. Some of her children talked her into changing her will to remove other siblings for whatever inheritance was left. Those children were already wealthy and didn't need the money, relative to the siblings which got cut out.

It's bigger than just private companies. They just want to beat everyone else to the punch. The elderly are a target for all manner of predators. I said it once, but it bears repeating: It's disgusting.

All of that is terrible. But for some reason, the neighbors convincing her to sell her cars to them for a $1 really rubs me the wrong way. You hope that neighbors are going to look after an elderly person. I'd be having some words with those neighbors. And then maybe some full page ads in the local newspaper explaining the situation. Maybe a billboard and some yard signage as well.

It seems to me that such transactions are obvious examples of elder abuse, which is against the law and actionable.

Our uncle was similarly scammed. We tried to act. The local sheriff wouldn't proceed unless our uncle said he was robbed. Of course, uncle thought he'd invested that money (and still expected a huge payout). So sad, because uncle had been quite savvy about money, before the dementia.

I don't know what the cure all preventative fix is. Maybe securing power of attorney earlier?

Our father wisely set up trusts decades ago, which did help us protect our mom later on. And after seeing other families tear themselves apart over inheritances, I am deeply grateful my siblings and our kids won't go thru that. (Fingers crossed.)

> Maybe securing power of attorney earlier?

You can do that with a doctor asserting him as incompetent. You'll need a lawyer.

Elderly got recycled, that is what happens.

You are right "It's bigger than just private companies."

It has to do with the society.

There is some respect for elderly still surviving in Hellas, but it is dwindling.

> talked her into changing her will

This would require an estate lawyer. The person needs to be of sound mind to change the will, and if the estate lawyer changed the will of an obviously impaired person, that should be actionable in court.

Is "sound mind" a binary thing? Isn't it more the case that we're all somewhere between 0 and 1 ?

These sound like cases of obvious impairment. As my elder relatives sank into dementia, it gets pretty obvious if you spend a few minutes talking with them.

One banker questioned the validity of my power of attorney when taking over my dad's accounts. (I was glad he questioned it.) I said the nursing home was about 1/4 mile away, and he was welcome to go and verify for himself his mental competence. Frankly, I had waited far too long to do this. In denial, I suppose.

I don’t think a lawyer is required.

Well, just like the giant oak that falls and gives nourishment to the forest saplings seeking to grow, so do senile old people give away their wealth to young hungry people in other countries seeking to sustain their internet scam businesses.

Just kidding. Although, maybe not totally. You wonder, when someone gets to some certain old age and is totally out of it, yet has tons of wealth tied up and doing no one any good, what is that money for except to be given to the next generation? I guess, some of it unwitting, hopefully more of it in a deliberate fashion to those it was intended for....

If granny can't even tell that $300k of her savings is gone, what's the problem then? Aside from her kids no longer being able to be the recipients of it.

God, I hope that I am able to realize that I'm reaching such a state and actively choose to give away my control of my assets to someone trustworthy, before I get scammed.

> Well, just like the giant oak that falls and gives nourishment to the forest saplings seeking to grow, so do senile old people give away their wealth to young hungry people in other countries seeking to sustain their internet scam businesses.

Why aren't these young, hungry people building something of value instead of stealing from abroad?

It hasn't escaped my notice that most of the scammers come from former British colonies. Make of that what you will.

In the French speaking world they come from the former French colonies (Côte d'Ivoire or Algeria).

> has tons of wealth tied up and doing no one any good

Don't confuse money with wealth. Money has no intrinsic value, so "unleashing" that money would only devalue other money, and not bring any kind of holistic benefit to the global population.

In other words, if you add a zero to the end of every bill and bank account, there's 10x as much money, but nobody is any better off.

Its immoral and horrific. My grandpa's wife (remarried) passed not too long ago. She passed because they kept juggling her back and forth between skilled nursing, hospital, and hospice. She couldn't speak or communicate effectively because of a medical condition.

Hospital marked her as NPO (no food, trouble swallowing), discharged her without resolving that back to skilled nursing (still NPO), and she went more than 10 days without any food or drink aside from saline IV, just waiting. It took a family member visiting and researching what NPO was on the chart, the gaunt look, and threatening a lawsuit before they finally took action and gave her a feeding tube (back to the hospital) before the talk "its not about the Quantity, but the Quality of Life"...

She didn't survive long after and passed within a month. Likely because of the sharp spike of no food, followed by food in her weakened condition.

During one of my visits for another family member (different facility) I overheard one of the staff on a smoke break outside insensitively joking with co-workers that the standard care is "skill em till they kill em".

I asked a friend who happened to have worked in medical/hospice, and they said its not uncommon to hear that among staff but they shouldn't have been saying that openly with patients or relatives nearby.

Absolutely horrific, there are no words that do justice or communicate the horror that awaits older people in these places.

This is society enforcing the norm of good parentage.

Love your children and they will one day take care of you.

I'd add reverse mortgages[1] and any similar home equity release deal into this mix. Stay away from those also if you possibly can.

[1] https://www.investopedia.com/mortgage/reverse-mortgage/

Sadly, the elderly is the forgotten demography. Only the family (not always) cares about them.

Everybody, one day, will be part of it.

I mean if someone dies young they won't be part of it

A large number of people living for many years with sharply reduced physical and mental capacity, retaining theoretical "autonomy", and mostly cared for by the medical-care-industrial-complex as opposed to family and community - all this is an accidental abomination created by modern medicine and economics. As a society and species this is new to us, and I doubt we will ever figure out a way to treat such a class of people humanely. It's just too big a challenge.

And more realistically how long we can afford to treat them humanely. I think we were in rather special place in recent decades. Where working population was high enough. Moving forward things are only getting worse in most developed countries.

While i generally agree, i must add that there are kind and loving people who work in hospice care that genuinely will go out of their way to help you, even on their unpaid days if you need assistance. Now, why the company would make unpaid days when nurses are still needed is another discussion.

But during my mother's in home hospice care, the nurses were extremely kind, even still coming when my father had covid, just wearing gloves and masks. The nurses were such an incredible help, and while I'm sure it cost a significant amount of money, the care we received was top notch and was worth every cent.

Based on my family's experience with eldercare, I'd lump in the local and state governments of Sun City AZ too. Given the history of that place, I'd've assumed they'd be far more proactive at protecting elders.

And then there was a recent Nevada case of a judge in cahoots with some lawyers, together bilking 100s of families.

So given the lack of oversight these days, I assume that kind of scam is widespread.

Can confirm, my mother works in one, the stories are horrific, even for those paying north of 10K per month.

If you have elderly parents, do what you can to be involved with their lives.

There are so many scammers! So many companies looking to milk the elderly for all they can. It's beyond disgusting, and it happens DAILY.

Simple things... man I don't even know, teach your elderly parents not to trust anyone. Only going to get harder with AI here.

From an old comment. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...

> I hate all the different ways companies target people.

> I recently booked flight on American Airlines for my 80+ year-old father. I requested the golf cart to take him between gates.

> Immediately I got a call from "American Airlines Health Alert."

> They made it sound like there was an issue with the booking... "An important health alert related to your flight." And there was a "Press 1, if you're over 50" option.

> Anyway long story short it was some shady marketing company selling me a panic button in case of falls.

> The lady was like"these are very expensive devices"... "we'll give you the device... but you pay a small fee for monitoring every month."

> Clearly she'd given the pitch 1,000 times. Didn't give me any time to talk. Finally, I was like, "Hey is there a problem with my Dad's flight, or are you just trying to sell me something?" And she hung up on me.

> Fuck American Airlines. Fuck all the airlines really, but it should be illegal to target the elderly just because they asked for help with connection flights.

Not an elder-targeted scam but I rented a car a while ago and I'm at the airport, obviously eager to just get into my car and leave, and the guy working the register asked me "you just want the basic coverage, right?" Oh yeah, sure, I said, not really thinking, and I was billed as much as the cost of the rental for insurance coverage I hadn't needed and would have declined if he asked me in a less misleading way. I hope that guy at least gets a commission for that trick.

My wife is a hospice nurse and she is constantly at odds with her company over admitting non appropriate patients. The industry is rife with fraud with “marketers” selling people who are looking for free home health care on hospice benefits. However, this forces nurses and doctors to lie about patients in order to avoid scrutiny by Medicare.

The evil part is there’s a cap on patients aggregate benefits and those often get used up before they are end of life. Then, when they are end of life and appropriate for benefits they don’t have any left.

I told her she should go work for the Medicare fraud division.

Is hospice just slow euthanasia? My experience is they give you successively higher doses of morphine until your body fails, over like 2-6 weeks

A dead patient is probably not as profitable as a continously dying one. These vultures will probably try to keep these poor people alive as long as they have money to spend and then kill them off when there is nothing left to collect.

It's palliative care for people at end of life. Morphine in this context is no more euthanasia than allowing the ill and infirm to make peace with their loved ones and emotionally accept their fate.

I guess ex-Presidents get an extension:

https://www.latimes.com/world-nation/story/2023-05-23/jimmy-...

It really just depends on the illness and how it progresses, which is hard to predict. Both my grandparents died of cancer; my grandmother spent close to a year in a hospice, using quite a lot of morphine, slowly fading away, while my (otherwise fit and active) grandfather went from "I've got a stomach ache, better see a doctor" to "dead" in about two weeks.

Life is slow euthanasia.

Nobody goes into hospice with a meaningful chance of survival. Your body is already failing. Hospice eases the often incredible pain of your body failing in terribly undignifying ways. Certainly the morphine doesn't do anything to increase your longevity, but it's not doing much to hasten your already-imminent demise.

Hospice is basically when the purpose of medical care goes from preserving life to maximizing comfort. It can be months of fairly normal life or a quick descent.

Often, but not always, patients are able to converse with loved ones, etc. While the ever increasing amounts of morphine are common, part of the reason is that actual tolerance for morphine with the pain of some end of life situations is much higher than you would suspect. Given that there is no risk of addiction (like there would be after a broken bone heals), the amounts are much higher than in other cases. However, to address your concern, the patient isn't normally high 24/7 waiting to die. They are not in pain and living out their last time on earth.

Hospice is any care for the terminally ill where the quality of life is prioritized of quantity/length of life.

Hospice care can last months or years, and takes many different forms. Some people want to die without drugs and that is an option. Hospice care frequently involves spiritual, and mental care as well.

In short, no it isn't euthanasia. Hospice care does not involve actively shortening your life, rather it is just transitioning away from treatments that lengthen your life.

The act of entering hospice for someone who is terminally ill is electing to die rather than doing all that is medically possible to survive. Typically that isn't much at that point. Given that you are entering "comfort care", and likely stopping all treatment, you are effectively shortening your life.

My heart breaks for anyone that has to watch their loved one wither away. Even more so for those without loved ones to care for them til the end.

Someone who is terminally ill doesn’t get to elect to die. The disease has already done that for them. Timing is the only thing they get any say in.

There is a big difference between not taking treatment to extend your life, and seeking treatment to actively end your life. That’s the difference between most hospice care and assisted-suicide/euthanasia.

Hospice doesn’t even necessarily mean ending all life extending treatment. It’s a realignment in process where the quality of the patient's existence is the top priority. Patients can elect to continue some or all of their treatments.

People in hospice are not choosing to end care that could save/extend their life. In the majority of. Often they continue treatment while in hospice, but the terminal diagnosis means hospice is a better choice for their quality of living than staying in the hospital or at home.

Morphine doesn't really cause "body failure", particularly if there's extended tolerance being developed and maintained. Methinks there's a seperate etiology in play for the scenario you describe

My sister is a (non-profit) hospice nurse, and according to her the record at her employer for how long someone remained on hospice without dying was 15 years.

Yea that’s not true. You should take hospice for you and your family rather than spend your last days in the ICU clinging to life.

If you stay full code when you do go you’ve been intubated so long they put in a tracheostomy; you’ve been unable to feed yourself so they put a gastrostomy tube in; you can’t filter your own waste and also can’t maintain blood pressure for normal dialysis so you’re on continuous renal replacement therapy; and because you can’t maintain blood pressure you are on increasingly large vasopressors which cause progressive ischemia of your limbs, bowel, and what’s left of your kidneys.

After all this your heart goes into various tachyarrhythmias requiring multiple episodes of CPR during which your sternum is fractured and multiple bilateral ribs are fractured. You suffer from esophageal rupture and bilateral pneumothoraces requiring bilateral chest tubes. Air constantly leaks into your soft tissues and you literally crackle like wet rice krispy cereal when you are touched.

That’s OK though you’re still not dead. You have time to develop multiple areas of skin ulcerations in your dependent/weight bearing areas even though you’re repositioned constantly by your nursing staff. These wounds progress and quickly extend through your atrophied gluteal and paraspinal musculature and reach your pelvic bones. You become infected by MRSA and have osteomyelitis and sepsis. Your blood pressure is still difficult to maintain and you require constant maintenance fluid and fluid boluses. Your nutrition is poor and albumin very low despite supplementation and trickle feeds so you develop anasarca, pleural effusions, and ascites. So now you appear grotesque - puffy from edema, skin crackling from subcutaneous emphysema, purple and contused from CPR, fingers and toes black and curled from pressor induced ischemia. There are tubes everywhere coming out and going into you. They’re in your throat, belly, and chest walls, central lines are in your neck for pressors and CRRT. Various machines surround you with alerts sounding almost constantly.

After all this your stress dose steroids have suppressed your immune system and you experience a reactivation of varicella and get Herpes Zoster across multiple dermatomes. Your skin is blistered and red in multiple areas and you are put in isolation to prevent spread of varicella pneumonia.

Finally after many weeks of decline and isolation your pupils are non-reactive and you lose brainstem reflexes. A CT shows diffuse hypoxic encephalopathy with herniation and brain stem compression. Because you’re full code and your “loving” family won’t accept death (over the phone now, it’s been a long time and you’re non- responsive and in isolation anyhow) a nuclear medicine cerebral perfusion study is done and it shows no blood flow to the brain. Now you can finally be declared dead.

Your family has already mourned your passing and had been going through the motions. You’ve been sedated and in isolation for weeks now and never got to say goodbye.

Your spouse is left with an enormous medical bill but there’s no money anyways so it goes unpaid.

The end.

No, my wife has had patients that have been on hospice for over a year. In order to get benefits they have to be demonstrably in decline.

For our non-American friends on the board, check out how much Nursing home costs in the U.S. by state.

https://www.seniorliving.org/nursing-homes/costs/

I'll save you the click. It's $100,000 / year. ($350,000 if you're unfortunately to be in Alaska)

damn...something to look forward to i guess

UK isn't much better. 10 years ago when my grandmother went into an, admittedly VERY nice, private home and the fees were £1000 a week.

Half the average US cost for a VERY nice place sounds a lot better actually.

When you take into consideration the median household income for both countries, the difference isn't as great as it sounds:

- US: ~$70,000 (source: https://www.census.gov/library/publications/2022/demo/p60-27...)

- UK: ~32,000 (source: https://www.ons.gov.uk/peoplepopulationandcommunity/personal...)

To be fair, a third of that is probably just the expense of rent. $66k remaining is $180 a day for the nursing care on top, which seems pretty reasonable aside from the messed up dynamics of medical care in general.

Almost any company by definition will be 'profit-obsessed'. The solution is smart regulation that prevents abuses.

Public hospice agencies would come with their own set of constraints that enable different kinds of bad behavior; I don't exactly trust Jacobin to dispassionately judge whether those are better than a well-regulated private industry could be.

Nah, private equity is a different beast than "any company".

1) Normal business: how can we innovate such that we maximise profit off the back of a decent product.

2) Private equity: how can buy this company with as much debt in its own name while extracting as much resource as we can via dividends.

(2) isn’t private equity. Private equity simply means funds investing in private, not public, firms. In fact, if you look at other comments people post about how companies are terrible because they have to please shareholders, private equity actually solves that problem.

What you’re talking about is LBOs (leveraged buyouts) which are a certain kind of private equity investment.

> private equity actually solves that problem

Private equity firms still try to please their shareholders, they’re just not beholden to a public stock price.

(2) is how private equity tends to operate.

You’re correct about the definition.

And, no, lbos are the buyer borrowing a lot to buy another company, while using the assets of the acquisition as collateral. The debt is still in the buyer’s name AFAIK (may be wrong)

> private equity actually solves that problem.

How does it solve that problem?

Private equity owners often have less short term incentives because their funds are usually 10 years long.

On average, an investment from purchase to exit may take ~5 years.

Whereas a public company with large institutional owners will have to respond to market feedback in real-time, i.e they are more likely to follow the herd if institutions (pension funds) demand a shift in industry trends (ie ESG). Whereas, private equity have no such concerns.

Why would companies founded not to be profit obsessed be that way? A lot to coops and more egalitarian company concepts don’t require what you’re saying.

I won’t comment on regulation being a solution to anything market related.

This is why I’m starting a cooperative instead of a corporation

It seems like part of what makes this sector attractive is that regulation is weak and it's unclear who's supposed to be in charge, at least according to the article.

Could someone explain to a total finance noob how a "leveraged buyout" transaction actually works?

I think I understand how hostile takeovers work for public companies (thanks to Elon's helpful demonstration of the concept) : Basically, a buyer can "acquire" the company against the wishes of the company's management because the company doesn't "own" itself in the first place. The real "owners" are the shareholders and so the two parties of the transaction are really the buyer and the shareholders, not the company that is being bought. Consequently, the buying price goes to the shareholders, not the company.

However, here we're talking about acquisition of private companies - so there are no shareholders. Then who exactly is the "seller" party in the transaction?

It could be that the hospice was owned by itself and the board members just got greedy. However, tge article implies that the bulk of hospices before consolidation were small, local businesses. I have a hard time believing that the owners of all those shops suddenly decided to throw the wellbeing of their employees and patrons in the wind for some personal riches.

On the other hand, if the hospices were not owned by themselves then there already must have been some sort of corporate structure before that the PEFs latched on to. But then, what was that.

In short, the "leveraged buyout" is an acquisition where it seems completely clear even beforehand that the acquired company will be strictly worse off afterwards. So why would a private company agree to that or, if not, who can make them agree? And who is the buy price paid to anyway?

Not an expert by any means, but I see nobody else has answered so I'll give it a shot. In the less extreme case, the seller has no choice but to sell or go under, so they'll take the best offer they can get. In the more extreme case, there is no choice because the seller has already taken on some debt under conditions that give the creditors first claim on assets. Then it's easy for the rentiers to buy up the debt and then wait - usually not long - for the company to run out of operating funds and trigger their own effective acquisition.

I once worked at a startup that suffered a similar fate. They had taken on some debt - a small amount really - during desperate times. Later, before the debt was paid off, they ran out of operating funds. Boom. Game over. The company shut down, most employees were immediately let go except for a few charged with liquidating the assets and wrapping up all the IP which went into storage somewhere never to be used again.

It sucked. That creditor probably made a tiny bit more than they had loaned originally, while everyone else lost. And the only way their own business model worked was to do the same thing over and over and over again, destroying enough aggregate value that even the residue they skimmed off the top could pay for their yachts or third vacation homes.

What you are describing has nothing to do with an LBO. You are just describing debt and bankruptcy. In an LBO the debt is part of a transaction to buy the company and the seller is rarely desperate. Banks wouldn't lend into an LBO of a company that is on its last legs.

Also, the probability that a lender gets out of a liquidation whole is slim. The probability in a case where the main asset is IP is basically zero.

To give an illustrative example, you have a company that runs a care home.

It owns the care home and employs the workers etc. So that company has a set of assets, and a set of cash flows, let's say the care home it owns is worth $10m, and it makes a profit of $1m a year (totally made up numbers). It might be privately owned or public - that's not important. This has nothing to do with hostile takeovers - the sellers of the business are willing sellers.

A buyer comes in and says "I'll buy this business for $15m". But the buyer doesn't have $15m, Let's say they have $5m. So they go to the bank and they agree to borrow $10m. But the bank won't just lend you $10m, they need collateral. So what the buyer does is they say "We'll borrow the $10m from you to buy the company, and the collateral we'll provide to the bank is the assets of the company, which we'll own once we've completed the acquisition". In a weird way it feels like buying the company with it's own money.

So now, the private equity firm own the $15m business, but the business now has $10m in debt. The reason this is good for the private equity firm is that if they can increase the value of the business 10%, the business is now worth $16.5m and the PE firm reaps all the reward - they make $1.5m profit from a $5m investment, instead of making $1.5m from a $15m investment. It's a way of them making efficient use of their limited capital.

Now, here's the bad side: That business that had $10m worth of assets, and made $1m profits? Well now it has $0m of net assets and it's got to make interest payments on the debt. So the Private Equity firm has to move quickly to squeeze more profits out of the business. It's like when Elon Musk bought twitter- he claimed he had to make a tonne of cuts because the business was hemorrhaging money, but the truth is it wasn't losing money until he saddled it with a huge amount of incredibly expensive debt.

A company always has shareholders. A privately-held share simply changed hands in private transactions, rather than in the public stock markets.

So an LBO happens when a PE buyer makes a sufficiently attractive offer (privately) to the shareholders. If they offer you 50% over what you think your own business is worth, you probably would take it, right? That’s the BO in LBO.

This large amount of money is typically acquired through debt - “leverage” - which is the L in LBO.

The classic coup de grace is to then load the giant loan onto the books of the acquiree and let them sink.

I think you are asking two questions:

* (1) How is a private seller different from a public seller?

* (2) What is the incentive for a private seller to sell, especially in this hospice case where, presumably, the seller cares about the people they employ and serve?

Whereas a public seller has shareholders to pay out, a private seller is simply getting paid to transfer the ownership of their business. In both cases there is a pay out. The amount to be paid out is a large number – the buyer invests only a fraction of the purchase, whereas a bank finances the rest of the transcation. A large payout is enticing to sellers.

A private seller has the incentive of "a large payout" to sell their business. Even in the case where the seller is plausibly ethical and knowledgeable of the outcome of the buyout, their ethics are in contest with the financial incentive. People make personal compromises in exchange for money all of the time.

Lastly, you didn't ask, but I think there is an important part of "how it actually works;" The buyer owes the bank the rest of the transaction. In order to make good on that debt they will need a competent "exit strategy." It seems typical that the buyer will attempt to slash costs up front in order to make a quick, initial gain (e.g., fire employees to avoid paying salaries). After the short-term squeeze realizes gains, the buyer needs to sell off the company to dump the rest of the debt (e.g., spin off some of the business area/assets and sell to yet another buyer at a mark-up; having attractive short-term growth figures probably helps with this part).

There's a lot of loaded language around Leverage buyouts but it is just taking out a loan to make a purchase. In practice they work almost exactly like a mortgage. You get a lender to take most of the cost.

> Could someone explain to a total finance noob how a "leveraged buyout" transaction actually works?

Have you ever bought a house using a mortgage? What you've done was a leveraged buyout of that house.

When you do a leveraged buyout of a business, it's the exact same thing! You borrow money from someone, and use that money to purchase the asset (whether its a house, a car or a business), and you use the asset you're purchasing to "back" the loan, essentially saying "If I don't make the payments, you can auction off the house/car/business to pay off the debt".

>However, here we're talking about acquisition of private companies - so there are no shareholders. Then who exactly is the "seller" party in the transaction?

Shareholders is just the name for "Partial Owner", and every company has one (or more) owners.

The owners of the business sell it to the one who is buying.

A company being "Private" just means that the company's shares (ie: the partial ownership) is not being traded on any stock exchange.

It doesn't mean the ownership of the business can't be sold, any more than the fact that your house not being listed on a stock exchange prevents you from selling it to whoever will buy.

>It could be that the hospice was owned by itself

There is no such thing as something being "owned by itself". There is always one final owner.

The Twitter transaction was not a hostile takeover. In fact it was exactly the opposite. The board ended up suing him to make him buy Twitter.

All that’s happened is that traditionally hyper-regulated industries with high margins are now being eaten by capital. It was to be expected. Every time you create an arbitrage opportunity, someone will come to eat it. So when you create a pharma arbitrage opportunity, we’ll buy compounding pharmacies. When you create a housing arbitrage opportunity, we’ll buy houses. When you create a palliative care arbitrage opportunity, we’ll come for your hospices.

Up to you what you want to do, but if you create a regulatively protected job, that’s an arbitrage opportunity. And finance will come for it. You can try to use social power by complaining in the news, but money talks louder. The old world where you could gasp your way into holding on to your mega profitable business by trying to use shame as a shield is over.

I don’t have shame, you see, and no amount of online kicking and screaming and downvoting will change it. Not today. Not tomorrow. Shame has no currency.

"arb"? Honest question, I don't know what that means.

Arbitrage maybe? Like, the tendency of markets to arbitrage profit margins downward unless a company has some kind of moat? In this context it's kind of confusing (maybe like "to be arb'd"?) and I might be totally wrong!

Sorry, arbitrage opportunity. Correcting.

What was the old world where things were diff?

It was less "efficient", so plenty of lower hanging fruit to find arbitrage opportunities means others could get away with more.

So basically you agree with the article’s premise except you think it’s good, plus you felt like doing a little Gordon Gekko impression.

Haha, yes! I'm not successfully arbing this. I'm one of many taxpaying suckers who were originally suckered by the industry and are now suckered by private equity. Boot tastes the same.

Yeah but here’s the thing: when the elites of society are allowed to cannibalize the rest, becoming more and more disconnected as things become more and more unequal, and those in charge no longer have the best interests of the public at heart, it’s a sign of imminent societal collapse. Sometimes it takes a long time. But based on your statement, the people with the money don’t appear to have any reason to care about the suffering they inflict. That’s late stage decay. Roman Empire stuff. At the very end the social contract unravels and the economy collapses.

shame is basically the way a culture punishes antisocial behavior. If shaming no longer works, that’s one less tool of self regulation the culture has. Thats not a good thing.

> when the elites of society are allowed to cannibalize the rest, becoming more and more disconnected as things become more and more unequal, and those in charge no longer have the best interests of the public at heart, it’s a sign of imminent societal collapse.

Pretty sure this is made up. We've had stable societies governed by kings and queens over a population of serfs.

I would say that the rise of discussions about the distance between rich and poor becoming popular and commonplace at every level, and organization/civil disorder/brutal crackdowns around that, tend to lead to Caesars and Napoleons. Republics transform into dictatorships at that point by necessity. Because after a long period of chaos and death, both the rich and the poor want a strongman to deliver them from a period of uncertainty into a period of prosperity.

But, the medieval world was the result after the collapse occurred. In the early republic you had a lot of citizen farmers, by the end the land was all owned by a small number of ultra wealthy patricians and the rest were slaves. And as the collapse happened the estates of the wealthy Romans led directly into the walled feudal estates. So you’re kind of proving my point. It was a fragmented and disconnected world, without the long distance commerce and bonds that make for a higher level of civilization. Slowly as people escaped into the cities, longer connections knit themselves back together and the feudal age gave way, things began moving forward again.

And “discussions of rich and poor” don’t happen in a vacuum, they occur in response to some real problem.

People do flock to strongman dictators in times of crisis, it’s true. They follow anyone who promises them safety and a return to the Good Old Days. Caesar I’m sure promised to Make Rome Great Again.

Anyway, "shame" usually just means indirect investment. I don't own slaves, but I probably own a piece of a fund that invests in another fund that insures slaves.

I still don’t get how a leveraged buyout is legal. It’s like the bank giving you a bunch of money and saying “don’t worry about returning it, someone else will pay it off”.

Fundamentally no different from buying a house on a mortgage - the loan is secured against the house, and if you don't repay it then the bank can seize the house but can't (at least in some states) come after you.

(The difference is that humans generally try to repay their mortgage even if defaulting would be financially better for them, whereas corporations have no such scruples)

The difference is that in personal mortgages the house isn't expected to be cash flow positive.

The bank extending a residential mortgage is securing against default with the asset (house), but they're guaranteeing the income stream (mortgage payments) against the buyer's income.

With a leveraged buyout, you potentially impinge the company's ability to generate cash (with additional debt payments and dividends)... which gets back to the parent's point about borrowing someone else's money.

> The bank extending a residential mortgage is securing against default with the asset (house), but they're guaranteeing the income stream (mortgage payments) against the buyer's income.

They're not, because they have no recourse against the buyer.

> With a leveraged buyout, you potentially impinge the company's ability to generate cash (with additional debt payments and dividends)... which gets back to the parent's point about borrowing someone else's money.

Well a mortgage is even more so by that logic, since the house has no income stream of its own.

> They're not, because they have no recourse against the buyer.

That depends on which state you're in.

Yes, I mentioned that earlier in the comment thread.

Rental properties are also financed with mortgages.

You're borrowing against the assets the company has. That's a pretty typical loan.

While that sounds concerning, I have to question the underlying thesis: Does private ownership always short-change customers, like the subtitle insinuates? "hospice agencies are now for-profit, putting profit maximization over patient well-being."

Do hotels or restaurants put profit maximization over customer well-being? If they do, they will be out of business rather soon. If the hospices have competition and comparability (for patients or their loved ones) then the same mechanism should work over time.

Hotels do this, and it’s a race to the bottom. The hotel experience has gotten so bad people accept going days without turndown service now.

That’s thankfully turning around. We were just in a hotel for a few days and they offered to turndown our room each night which we declined as we don’t really make a mess and it was only two nights.

Would you like to "make a green choice" and have our staff ignore your dying loved one for the day in exchange for a $5 Starbucks gift card?

Or maybe people want to be left alone in the evening?

My guess is that don’t actually mean turndown service, but just general housekeeping.

Yes.

FWIW, the first thing I do when I arrive at a hotel room is to put the Do Not Disturb sign on the door handle, where it stays for my entire trip.

I have zero desire to have anyone enter my room at any time, for any reason, while I am paying for it.

In some longer stays (4-7+ days), hotel management will actually require housekeeping to enter. Fine, OK, I get it. But I do not wish it.

I don't claim to know how common my preferences are, but it seems likely to me that most guests don't care a super lot about maid service, so it's a natural thing to dial down.

> Do hotels or restaurants put profit maximization over customer well-being? If they do, they will be out of business rather soon. If the hospices have competition and comparability (for patients or their loved ones) then the same mechanism should work over time.

This is not how it works and is why the government sometimes needs to step in with regulations. As a founder in the healthcare space once said to me: “I like regulations because it means I can do the right thing for my customers and not have to worry about competing with people who are willing to do harm because it’s more profitable.” Companies need to be able to compete. Some will do better. Some worse. But the government needs to establish the baseline rules so society as a whole isn’t harmed.

Let's be honest in that regulations are often made due to benefit of companies and detriment to people, too.

"private equity" is not the same as "private ownership", no?

>I have to question the underlying thesis: Does private ownership always short-change customers, like the subtitle insinuates?

What a bizarre misrendering of the actual question, which is "does private equity systematically undermine the quality of healthcare?"

>Does private ownership always short-change customers, like the subtitle insinuates?

Corporations literally only have one goal, to generate the maximum profit for shareholders.

By definition profit is money not spent on making services better.

I don’t think that’s true of all corps like cooperatives.

That’s not all profit is. How would labor theory, surplus value, and so on, be explained?

Please don't spread this meme about corporations being required to maximize profits/shareholder value. There isn't a requirement or law that says corporations to maximize profits.

The legal obligation is to act in the best interest of the corporation on behalf of the shareholders. There are limited situations where the only goal is to get a higher stock price, like in a buyout, but in general business there is no legal obligation to chase profits over other values.

Corporations can do things that actively remove value from shareholders, and they do it all the time. Donating to charitable causes, benefits packages that are incredibly generous, sending employees home early on the day before a holiday, providing discounts to employees, etc. All of these things would be illegal if profit-maximizing was law, but it isn't. Instead corporate officers can say that the long-term benefits of acting as a responsible corporation is in the best interest of the company.

Anyone saying that screwing people over for the benefit of the corporation is a requirement of corporate governance is full of it.

See here for more: https://insight.kellogg.northwestern.edu/article/shareholder....

Isn't that just buying "goodwill"? Which is a form of long term profit maximisation.

You could try saying that. I would say that goodwill isn’t profit maximizing because you can’t account for it, you can’t sell or convert it to profits reliably, and it has benefits other than money.

Or you could just say that having goodwill is in the best interest of the company for a variety of reasons.

The point is: even for-profit corporations have no legal obligation to profit maximize. They simply must act in their best interest. What is in their best interest is intentionally fuzzy because it allows corporate officers to act in ways that aren’t directly profit seeking.

Corporate types like to try to hide behind the rule saying they legally have to do the shitty profit maximizing thing. But they don’t.

"Goodwill" is just greenwashing.

No CEO has ever been fired for maximizing profits, so CEOs are incentivized to do anything - everything - to maximize profits. Many a CEO has been fired for not doing everything possible to maximize profits.

What's worse; the structure of corporations alienates the ones making malicious (but profitable) decisions from the ones executing the decisions. So that even if everyone in the chain-of-command is painfully aware that they are acting maliciously.

So even if corporate types don't have to do the shitting thing to maximize profit, they are usually incentivized to do so and provided a fig leaf for their moral qualms.

See; Exxon and Global Warming.

You're missing my point (and using the term greenwashing in a way that I don't understand).

I'm not saying that corporations won't act in morally wrong ways in the name of profit maximizing.

I'm saying that there is no legal requirement that they act in this way. There is a meme/idea that goes around saying that there is a legal requirement to profit-maximize or maximize "shareholder value" over acting morally. That is false. Anyone claiming that is wrong and probably trying to cover for something terrible they've done. The fig leaf isn't real, and we need to call it out. Doing shitty things for higher profits is not a requirement, and never has been.

Of course it is legal to profit maximize in unethical ways, and some companies will do this, even though they don't have to.

Many a CEO has been fired for not profit-maximizing, but many a CEO has been fired for profit-maximizing while trashing the reputation of the company. Boeing and Equifax are two immediate examples of CEOs who got fired for making extremely profit-focused decisions that were severely unethical. It happens.

>I would say that goodwill isn’t profit maximizing because you can’t account for it

https://en.wikipedia.org/wiki/Goodwill_(accounting)

Profit maximization is the overarching objective. Customer dissatisfaction, complaints, fines etc is only a problem if it starts eroding profits.

Businesses have developed countless mechanisms to be able to survive client backlash.

Oligopolies and cartels is a major trick. Competition highlights poor performers. Not good for business.

Uninformed customers is another biggie. Hence, fight consumer protection mechanisms, limit disclosure etc.

Finally, regulatory capture, eg fixing the rules of the game so that legally there is no recourse.

So, yeah, in some ideal world in which economists win Nobel prizes arguing the optimality of the corporate structure you'd be right.

We dont live in that ideal world.

That sad thing is that, obviously, profit maximizing private enterprize, just like the public sector itself, are indispensable organizational units.

Until we learn to tame them we will be paying the price.

One big difference is : the one that is experiencing the hotel is choosing it and paying for it, have different experiences with hotel before and after...

In hospice it is generally the kids choosing and paying the hospice for their dad or mom who will live there... and when they say the food is bad you often assume they ham it up... And you tend to chose the place based on beautiful brochure, as you have no experience in this area... it is easy to move to another hotel, not so much to move your dad to another hospice

In France we recently had a huge scandal about for profit expensive nursing home (Orpea). Many old people were undernourished to save on food cost for example...

Have you stayed in a hotel before? Because of favorable tax rules, hotels have turned into a cartel business. Every aspect of the hotel experience is worse than it was 10, 15 or 20 years ago. Because the top 5 hotel chains control more rooms than the rest of the industry, they are able to segment and spare every expense. Jumping brands doesn’t help because they ape each other. The default experience is no housekeeping, two towels, a price 30-50% more on an inflation adjusted basis, prepaid at checkin.

Since the 1970s, when modern conservative legal theory started to take root, the playbook for American business is tumor growth followed by cost cutting, even at expense of the business itself.

Medical networks and sub-entities are no different. Nursing homes are a preview of the future - they provide an operational money losing minimum viable service, but the owners are able to walk away with substantial returns on the real estate and overheads. In 10 years the default will be chat with ChatGPY, followed by a video call with a NP in India or the Philippines and wait 4 months to see a provider in person.

> two towels

Why is everyone obsessed with towels? This is not the first time I’ve seen this indicated as a standard for quality, but I don’t understand. Do you _need_ more than two towels?

Depends on how many people are staying and for how long... Though you can just request more.

To add, I have never been to a place that wouldn't give you another towel if you gave a 10 second call to the front desk

I typically travel with my family of 3-4 people. I also prefer to use a fresh towel if I shower after a workout or some other interval that doesn’t align with housekeeping.

And honestly, what’s the bfd? The marginal cost of washing a towel should easily be supported by my $350/night expense to stay at Hampton Inn or whatever.

The cheapness has moved beyond that now. I’ve encountered properties who refuse to refresh sheets now, or require a request to be made at a time like 3pm, when you arrive at 8pm.

Hmm, I always read this as two towels for one person. I guess I’ve never encountered a hotel that didn’t give me at least as many towels as the people staying. That’s just absurd.

> If the hospices have competition and comparability (for patients or their loved ones)

People in end-of-life care are kind of a locked in market. Nobody is going to a better hospice that might be an hour further away from all their family.

I don't think a restaurant is really comparable to hospice care. There's not much a long-term commitment involved, the pricing is more transparent, it is easier to judge the quality of what you are getting, and the service is not exactly essential.

You know I've driven by a hospice center near my home and I'm always struck by how drab and boring it looks. It looks like a bank or a branch of the DMV. It's sad to me that that is the kind of value we place on our elders. Shouldn't they spend their last days in a place of beauty? Sculptures, gardens, a frog pond, anything. Not this boring grey cube. It's so sad.

No one needing hospice care is up walking around enjoying the outdoors.

It'd sure be nice to see through a window from your bed, though, or to share a stroll with a family member if you can get into a wheel chair.

A ton of hospice is actually done in home. Is this just a base of operation for hospice workers who are doing home visits?

Wow this just sounds downright aweful.

I had a friend that went through hospice.

Having caring staff that was empathetic to the families is an important part.

Housing: Check

Veterinarians: Check

Healthcare: Check

Education: Check

Hospice? Check

Cool.

Funeral Homes: https://kffhealthnews.org/news/article/funeral-homes-private...

Defense: https://responsiblestatecraft.org/2023/03/22/as-private-equi...

Adult content: https://techcrunch.com/2023/03/16/pornhub-owner-mindgeek-sol...

Matt Stoller has lots of quality writing on the topic:

https://mattstoller.substack.com/p/closing-down-the-billiona...

https://mattstoller.substack.com/p/why-private-equity-should...

Gotta say the irony is strong with a private equity firm called Ethical Capital Partners acquiring porn company MindGeek. I wonder who's fucking who the hardest?

Is there anything unethical about porn?

I don't think there's anything inherently unethical about porn, but quite a bit of porn production involves unethical practices.

I think the answer depends on one's world view.

Historically not the kind of topic that can be debated well on HN.

A lot of institutions name themselves to cover their biggest weakness. It took me a while to realise that the street I lived on a decade ago was called "xyz Gardens" because it didn't have any.

"Democratic republics" are often neither democratic nor republics

Gretchen Morgensons book The plunders: how private equity runs - and wrecks - America, is also good

Gotta find new industries to shuffle around all of their debt: https://www.spglobal.com/marketintelligence/en/news-insights...

They sure do love those captive markets, don't they? Very little elasticity or opportunity for substitution, so maximum rent seeking. It would be hard to find a better argument for price controls and/or Pigovian taxes.

This is not new, 14 year old video:

Bruce Wasserstein: Gouging Grandma: https://youtu.be/bcsxGxzrTsc

A friend was temp CFO for an assisted living corporation for 2 years. He also teaches finance for an MBA program. He takes these short-term roles to inform his teaching.

Afterwards, I asked him what he had learned.

"I learned to never end up in a nursing home."

Is there a way to invest in stuff like this? What kind of returns do you get?

Start a company, get a care home to buy itself and give itself to you, then profit! The returns are exactly what you make of them.

No, because it's private equity. As I said in another comment, public markets are effectively for dumb money, so they'll let anyone invest because they're essentially set up to take advantage of investors. Private investment means investing on your own, and is what "sophisticated" investors with a lot of money do.

You have to be an accredited investor AKA millionaire but yes you can invest in these funds and the returns aren't too bad, though they've come down as the number of buyout firms has exploded. Too much competition for deals now.

The best way to make a buck in private equity these days is probably to start businesses and sell out to greedy buyers ASAP. Buying laundromats got really big in the past few years and I knew of a guy who started over 20 of them and sold them to idiots.

Sure. Just talk to your wealth manager or private banker, they'll be happy to help you ;)

Of course they are, all the money the boomers were planning to leave to their kids are now going to pay for quality not quantity of life in the remaining time they have.

I care a lot

Literally "vulture capitalism."

Not literally, unless someone's literally getting eaten.

Vultures do more than eat. True, that's one of their functions. But a literal vulture capitalism would have probably included business entities created and maintained by the vultures themselves. They'd probably need an economy, a legal framework for establishing business entities, and a host of other traditional capitalistic structures. They'd have fantastic recycling and decomposition industries.

This gives me a great idea for a new hospice startup: To get stated, we'll need a bunch of hospital beds and a flock of vultures.

Like ${whatever the recent hot startup renting out goats to graze on customers' lawns}, but for hospice care!

“Like Uber, but for hospice care, our network of independent service providers will transport your loved one to the afterlife(*) cheaper, faster, and in better comfort than traditional services!

(*) Afterlife not guaranteed.”

Vultures wait until you're dead to pick over your bones.

There's a quote attributed to Winston Churchill [1]:

> As King put it: "Winston Churchill once famously observed that Americans will always do the right thing, only after they have tried everything else."

In my experience, America does tend to have this blind spot where everything but the blindingly obvious is blamed and we throw our hands up saying "there's nothing we can do" for problems literally no one else has.

The problem here is capitalism. We need more government, not less. The Church of Quasi-libertarianism and deregulation simply does not work.

Shelter is one of our basic needs to survive. There is absolutely no reason why the richest nation in the history of the Earth cannot put a roof over the head, provide sufficient food and give access to clean water to every man, woman and child in this country. None. It's a choice not to.

The insidious part of our capitalistic cult is how insidious it is. Every aspect of our lives becomes financialized. Debt is built into our existence: housing, student, medical. It's the chosen method of control where once it was fealty to a monarch and whoever your local vassal lord was.

Mark Fisher once said [2]:

> it is easier to imagine an end to the world than an end to capitalism

But no, the problem is going to be anything else.

[1]: https://www.npr.org/sections/itsallpolitics/2013/10/28/24129...

[2]: https://en.wikipedia.org/wiki/Capitalist_Realism

The problem isn't "capitalism". Every developed nation is capitalist, including China.

And more government isn't the answer either (nor is less government); what's needed is better government. America's governmental system is uniquely badly designed and broken. Adding more civil servants isn't going to fix things, just like you can't make a rowboat go faster by adding more rowers who are rowing in the wrong direction or not even rowing or harassing the people who are rowing.

This sounds exactly like the kind of phenomenon I should have in the dystopic, dark comedy future adventure game I'm building.

(Imagine Idiocracy crossed with Fallout and HHGG. see my bio here if curious.)

Kind of ironic to note that the world is upside down right now.

Public companies, which are regulated precisely to protect the financial interests of shareholders, are forgoing profits for the sake of their ESG scores.

Meanwhile, private equity, which is not regulated in the same way and theoretically could be more easily managed towards objectives other than profit, are smeared as “profit obsessed.”

Wild times

Public markets are where all the dumb money is, and are much more subject to politics and sentiments. Companies that went public basically did to to offload their company on the public so they could get money.

Who's forgoing profits for ESG scores? That would be pretty novel to me.

Because of the ESG rule* (the repeal of which was the first veto Biden ever used), which allows pension fund managers unprecedented flexibility in their fiduciary duties to choose funds that align with what some see as “woke agenda” goals as opposed to another profit motive, all kinds of public corporations are seeking higher ESG scores, at the expense of profits, so they can stay in these pension funds.

It’s controversial because pension managers control over $12 trillion of OPM (other peoples money) in the US, and the great centralization of control of these funds in a few politically connected firms, and have been thus turned into a political instrument of change instead of just a personal returns manager/maximizer.

However you want to judge it good or bad, it’s a serious market distortion

*The ESG rule—Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights—permits retirement plan fiduciaries, such as 401(k) plan sponsors, to consider climate change and other ESG factors when they select investment options and exercise shareholder rights, such as proxy voting

But it doesn't sound like it actually happened?

What is “it” and what makes you say that?

You said the ESG rule was vetoed.

Repealing the rule was vetoed.

Good ESG scores do not appear to be correlated with poor profitability.

https://www.stern.nyu.edu/sites/default/files/assets/documen...

That’s one analysis.

Here’s another. Researchers reviewed shareholder value created by firms with high and low ESG ratings—scores provided by professional rating agencies. Their conclusion: “Telling firms that being socially responsible will deliver higher growth, profits and value is false advertising.” https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3557432

What they found is also apparent on a macro basis. Over the past five years, global ESG funds have underperformed the broader market by more than 250 basis points per year, an average 6.3% return compared with a 8.9% return.

Despite tens of trillions of ESG investments, investors haven’t done very well nor generated much good

How much if that is because of the tech bubble bursting? Tech and ESG are strongly correlated.

I don’t think it helps grow a company, but equally I don’t think on a macro scale it actually hinders either. So if it’s a net 0 why not do good and make money? It’s not an either or.

A discussion of the issue you may find interesting: https://www.aier.org/article/esg-as-an-artifact-of-zirp/

TLDR, tech bubble and ESG likely correlated to a common confounder

There is a difference between esg being individually good for companies and esg performing well in funds. That perhaps speaks more to fund management than esg itself.

Most funds perform more poorly than broad indexes for example.

Yes. I shared evidence of ESG being bad for both individual companies (paragraph 2 above) as well as funds (paragraph 3)

> Despite tens of trillions of ESG investments, investors haven’t done very well nor generated much good

You've not provided much evidence for the generated good part. The profit is the easier part to measure, but I'd like to know how they're doing on the ESG part (which is of course why they have lower yields and still chosen to begin with!).

I think (and credit the insight to a friend) that we should really be investing not only in terms of profitability, but in how ESG-effective (or in more general terms, constructive, good for society, effectively altruistic, etc.) the organization is. By now it's been said many times, and it's becoming quite clear we're optimizing the wrong thing (just returns). It's not as bad as it seems, simply because I think a large portion of individuals are highly charitable, and also make personal choices that take something like ESG into account, including shunning products and companies, as well as the introduction of government regulation.

But there are significant problems because profit-driven investing and then buying consciously doesn't work say for mitigating climate change. The oil and gas industries and several other industries can operate largely independently of consumer goodwill, and sometimes consumers really lack the capability or means to have enough information to enact any ideal in this part. Moreover, some large offenders (industries and individuals that act very anti-socially) can be quite bad, outside of individual control. Regulation can help, but then it tends to be slower and requires thorough consensus.

ESG investing helps in that (a) You should be directly optimizing the right thing (prosocial and environmental aspects of the company); (b) An ESG fund can do the research for you much more thoroughly; (c) Activist investors can change entire companies direction (with voting shares).

It should be said though that company shared ownership, i.e. stocks, are just that. Even if the stock of say an oil and gas company that disregards climate change completely is sold en masse from activism, that can reflect not that much on the operations of the company and the stock price can bounce back on a restricted pool of indifferent investors. But I believe there are some liquidity and credit benefits to a strong stock market valuation. (Edit: although of course by controlling voting shares an activist group can control the company, which has shown potential recently I believe)

This is why I think credit to ESG ventures should be the investment priority more than ESG companies themselves. And it clearly doesn't excuse individuals of acting responsibly in other ways and also promoting legislation to help (It does help push for change when you and many others are invested in a good outcome in a very literal sense).

---

The limit of this idea is something I call 'Elementalism', a form of organization where we would try "optimizing for the right things" even more directly: What if we had some distributed entities that could evaluate organizations for their impact (on many fronts, say scientific development, technological development, artistic development, being healthy/good for mental or physical health of people, etc.) as close to quantitatively as it can, and then that could translate into some sort of credit or monetary reward directly. So if your company makes something that is proven to pollute the environment and generate so much in health damage to the population, maybe you could be "fined" directly by those (distributed) entities; and on the flip-side if your product has some extraordinary health benefit to users, maybe it could be rewarded more directly on impact; this could respond much faster than trying to change rules and regulations. I'm not sure if those entities should be a part of government or not... but in any case they'd need to cooperate closely among themselves and the government to collect and distribute this income/credit.

What’s funny is the anti-ESG crowd don’t even understand what an ESG score is. It’s not about how environmental or socially conscious a company is. It’s about how exposed a company is to environmental or social or governmental risks.

It’s one thing for random HNers to not understand this. But then you have Musk who should know better and probably does, but chooses to instead misinform his massive following.

No one was tracking these very real risks until recently. The risk that a company highly exposed to California homes might possibly be at risk of the increasing number of wildfires. Or one dependent on the Russian market may lose it entirely because of sanctions.

That's not what it is. https://money.usnews.com/investing/news/articles/what-is-an-...

I agree that this is concerning. I'd also say that the only thing worse than PE running these would be the government running them (see Canada). This is a natural role for religious organizations (I'm not religious) and I don't know what most logically could take their place that would actually care about people. (Companies sort of have to due to competition, but after profits, governments don't have to care at all). Ideally incentivizing nonprofits to run these and disencentivizing for profit ownership it probably most reasonable.

I'm not sure religious organizations (or, at least, the religious organizations which would realistically be involved) have a very good record of running institutions that involve significant power asymmetries

> PE running these would be the government running them (see Canada).

I know there were a lot of problems in the Canadian system caused by or exposed by Covid, but weren't the worst of them private companies in some sort of private-public deal not, as your wording suggests, the government running them?

I may be misremembering. Somewhat like the US state-to-state variability, province-to-province is quite different also I suspect.

Meanwhile, the religious organizations in Canada https://www.npr.org/2022/07/25/1113498723/pope-francis-apolo...

> (see Canada).

Thanks, I've never seen intricacies of Canadian health care system explained quite as clearly and succinctly as this. :)

I can't help but think of that complete set of Beatles transcriptions where the orchestral build-up in "A Day in the Life" is a single staff titled "Orchestra" with a rising line drawn on it.

I'll take that as a compliment!

Depends on what you mean by "government". For example I can imagine my local city government running the hospice and doing it very well. I like my city council though. I think they're generally honest and are doing the best job they can.

Americans (I'm assuming you live in America), love to point to the Canadian health care system as some sort of failure.

Does it have its problems? Yes. Do Canadians think that American healthcare is a better system? Actions indicate: No.

How do I know? 90% of Canadians live close enough to the border to hop over and visit a doctor and be home in the same day. That's incredibly rare to do.

The few Canadians I've met who think its better in the US have either never dealt with the US system, or have only dealt with it in terms of very high end plans provided by an employer.

As someone who has lived in both countries, and dealt with US healthcare (ACA, and pre-ACA). I never want to deal with US healthcare again. Last time I lived in the states my premiums were ~7% of my take home pay. That's a massive "tax" to pay, and that's before you actually see a doctor.

So yeah. Canada had issues with care homes during Covid, but the correct point of comparison isn't top-notch private care homes in the US (A majority of Canadian care-homes are private anyway, so we have the same high end thing here). It is to compare the free public care homes in Canada with people dying at home in the US because they can't afford any care at all.

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