Brown Brothers Harriman Capital Partners invested in American Physician Partners (APP) in 2017. APP recently told hundreds of ER physician employees that the company will declare bankruptcy. It took no time for the firm to begin welshing on emergency doctor paychecks.
The same industry that brought patients "surprise medical billing" has now innovated into "unpaid ER doctors."
Flashback to 2017 when APP's press release stated:
We are excited to have the opportunity to invest in a leading outsourced ED management company alongside the experienced team of former hospital executives and clinical experts that John Rutledge leads,” Bradley M. Langer, managing director at Brown Brothers Harriman & Co. and co-manager of BBHCP, said in the release. “APP’s outsourced solution — which goes beyond physician staffing to encompass complete management of the ED — plays an essential role in helping hospitals to improve clinical outcomes and drive financial performance.”
I imagine stiffing ER doctors has and will cause great harm to clinical outcomes in APP's numerous community hospital ERs.
The people who are supposed to reign in this nonsense are AWOL. A current member of Congress, Dr. Mark Green, helped start American Physician Partners.
One APP physician said of the current disastrous situation:
"...this is the United States. It doesn’t matter. If no one went to jail over the financial crisis no one is going to jail over this. I’ll tell you, though: Never in a million years would I have imagined members of my profession talk about joining a union."
The greed and leverage boys answer solely to themselves. Who can find out how much cash BBHCP and its founders bled from the company as well as key asset transfers?
Moody's credit rating from November 2021 states:
The credit agreement permits the transfer of assets to unrestricted subsidiaries, up to the carve-out capacities...
Despite the turmoil and threat of bankruptcy there has been no update to Moody's credit rating of APP.
Who stands to be harmed by APP's sudden failure? Moody's said:
The company has approximately 155 contracts with health systems in 17 U.S. states through which it serves ~4 million patients annually. The company is approximately 50% owned by BBH Capital Partners with the remaining ownership split between the company's management team and physicians in roughly equal proportion.
APP has some geographic concentration with Texas, Florida, Tennessee, and Arizona representing more than 60% of profits.
Here's a flashback to financial crisis and no one going to jail:
The PEU boys have a playbook and lawmakers have facilitated their arrogance and mendacity. Treating doctors with impunity could not have happened twenty years ago. That impunity has physicians considering unionizing.
Many doctors made a deal with the devil and need help re-balancing the obscene power differential. I'm not sure anyone is available.
Politicians Red and Blue love PEU (private equity underwriters) and increasingly more are one.
Update 8-1-23: Former PEU and Virginia Governor Glenn Youngkin showed his lack of respect for rules and physicians by appointing a non-doctor as interim head the state health department. Ironically, Youngkin and former health department head Dr. Randy Gordon grew up blocks from one another.
During a recent trip to Richmond, Virginia I exited the men's room to see a giant Glenn Youngkin walking toward me on a massive TV screen. His welcome video scared the bejesus out of me.
