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Senators Warn of Antitrust Issues as Private Equity Dominates Wheelchair Industry

By  |  October 23, 2024

In a joint statement, U.S. Senators Elizabeth Warren (D-Mass.) and Richard Blumenthal (D-Conn.) have voiced concerns over the growing dominance of private equity (PE) firms in the wheelchair industry, citing its negative impact on vulnerable patients. According to a letter addressed to Health and Human Services (HHS) Secretary Xavier Becerra, the senators highlighted the increasing consolidation of the specialized wheelchair market by two private equity-backed companies, National Seating and Mobility (NSM) and Numotion, which has resulted in significant delays in repair services for wheelchair users.

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    The senators’ letter draws attention to the roughly 5.5 million wheelchair users across the United States, many of whom are left without adequate mobility for weeks due to slow repair services. Per the statement, these delays are attributed to the companies’ inability to conduct timely in-home assessments and complete repairs, even after obtaining prior authorization and the necessary parts. Warren and Blumenthal argue that this is part of a larger trend in the healthcare industry, where private equity firms prioritize short-term profits over the well-being of patients.

    “Private equity’s involvement in health care markets has worsened issues like surprise billing, inadequate staffing, and poor oversight,” the senators wrote. They commended the Biden administration’s efforts to investigate corporate greed in healthcare but urged the Department of Health and Human Services to further address the negative consequences of PE ownership, particularly for vulnerable populations such as wheelchair users.

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    Read more: Elizabeth Warren Supports DOJ Antitrust Probe Into Nvidia

    According to industry data, the average repair delay for wheelchair users can range between 60-82% of total waiting time, directly linked to inefficiencies in service after all necessary authorizations and parts have been received. The senators pointed out that while private equity-backed firms make significant profits from selling modern wheelchairs, repairs are less profitable, leading to a lack of investment in customer service and repair infrastructure. This business model, they claim, not only hampers access to timely care but also reflects broader concerns about private equity’s growing influence in healthcare.

    Senator Warren has been particularly vocal about the detrimental effects of private equity in various sectors, including healthcare. According to a recent statement, she reintroduced the Stop Wall Street Looting Act in early October, a legislative push aimed at holding private equity firms accountable for the companies they acquire and the consequences on consumers, employees, and investors alike. Warren has also been a strong advocate for consumers’ right to repair their own equipment, recently criticizing major corporations like John Deere for undermining such efforts.

    The letter from Warren and Blumenthal is part of a broader push to scrutinize the expanding role of private equity in healthcare. The senators urged HHS to consider additional measures to counterbalance PE firms’ profit-driven motives, which they claim are at odds with the needs of vulnerable patients who rely on prompt and reliable healthcare services.

    As the private equity sector continues to expand its influence in healthcare, the impact on patient care, particularly in critical areas like wheelchair services, is expected to remain a contentious issue. Warren and Blumenthal’s call for action places further pressure on the government to intervene and ensure that patient well-being is prioritized over corporate profit.

    Source: Warren Senate