Private equity sees opportunity in the healthcare industry due to the uncertainty currently in the marketplace. When uncertainty shows up in any industry it provides opportunities. If private equity investors can calculate the potential risk, and project where insurance dollars are going they may be successful in their investment efforts. In healthcare, part of the initial analysis of the viability of a product or service is who will be the "payor". If the payors are insurance companies or government, you can build or scale a product or service to the marketplace based on some reimbursement projections. With an aging U.S. population that continues to grow, physical therapy and rehab services are good bets, as people live longer they will need this type of therapy. Additionally, healthcare businesses that focus on diabetes and obesity which is growing among the general population should do well. End of life care provided by hospices are also good bets, given many patients have this type of care as an option. The challenge for investors is determining where reimbursement for these services are going. and will they remain fee for service or be capped.
Private Equity Moves Money into Healthcare
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