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From Ivory Towers To Main Street

Chul Hyun

This article first appeared in Health Affairs Forefront (July 2025) and is republished here with attribution to the original publication. Copyright © 2025 Health Affairs by Project HOPE – The People-to-People Health Foundation, Inc.

Advancing Community Health In A Corporate Era

As private equity (PE) continues to reshape health care delivery in the United States, academic medical centers (AMCs) face unprecedented ethical and operational challenges in retaining their influence beyond hospital walls. Long regarded as anchors of clinical excellence and public service, AMCs are now contending with corporate-backed outpatient groups for both patients and practitioners. These dynamics threaten not only AMCs’ market presence but also their ability to fulfill core public missions of education, equity, and care.

This article explores how AMCs can reclaim leadership in outpatient care by extending their reach into community-based models, prioritizing access and equity, and leveraging partnerships that embed academic excellence in local delivery systems. It also examines how policy oversight—particularly at the state level—can play a vital role in insulating AMCs from the destabilizing effects of PE ownership, including workforce turnover and financial risk transfer. Ultimately, this piece argues that the values underpinning AMC models offer a critical ethical counterweight to profit-driven care. As the corporatization of medicine accelerates, AMCs must evolve not just clinically, but structurally and politically, if they are to remain a vital force for equitable, community-centered health care.

A Path Forward For AMCs

AMCs have long been dedicated to medical education, research, and specialized patient care, yet their engagement in community-based health care has traditionally been limited. As the corporatization of health care reshapes access and delivery, the expansion of PE-backed medical groups has shifted outpatient and specialty services away from academic institutions, challenging AMCs’ ability to maintain meaningful connections with the communities they serve.

Historically focused on tertiary and quaternary care, AMCs have often deprioritized primary and preventive services due to financial constraints, institutional rigidity, and reimbursement models favoring high-margin procedures. However, as health care systems evolve, AMCs must extend their reach into community health to sustain their mission and uphold their ethical obligations. Strengthening their role in addressing social determinants of health and expanding access to specialty services across all communities will allow them to bridge long-standing disparities in care. Strategies such as community-based participatory research and community-engaged research provide frameworks for AMCs to collaborate with local populations, ensuring that academic expertise translates into tangible improvements in public health.

Despite the clear need for AMCs to extend their reach, they face significant barriers-particularly due to the growing financialization of outpatient specialty care. In procedural fields such as gastroenterology, ophthalmology, and others, PE-backed groups have aggressively acquired independent physician practices, prioritizing high-volume procedures over broader, continuity-based care models. As a result, access to specialty services is increasingly shaped by financial incentives rather than community health needs. These corporate models, which emphasize efficiency and profitability, threaten to erode AMCs’ ability to engage meaningfully with communities and deliver comprehensive care.

Moreover, PE acquisitions have disrupted health care delivery by destabilizing workforce continuity. A study of 200 PE-acquired ophthalmology practices (2014–21) revealed a 46.8 percent increase in total clinicians within three years- but also a 265.0 percent rise in physician turnover, with annual departures 13 percentage points higher than in non- PE-acquired practices. These trends raise concerns about the stability and consistency of care and underscore the importance of the organizations shaping how health services are delivered. The differences between AMCs and PE- backed groups go beyond finances-they affect how care is structured, accessed, and experienced. Understanding who owns and governs these entities is essential to evaluating their impact on communities.

Alternative Models For AMC-Led Community- Based Care

To remain competitive and mission-driven in an increasingly commercialized health care landscape, AMCs must explore alternative care models that extend their reach beyond hospital walls. While many AMCs already operate outpatient procedural centers, these facilities often lack an advantage over PE-backed competitors due to high facility fees and administrative overhead. To differentiate themselves, AMCs must adopt a model that provides greater accessibility, cost- effectiveness, and unique value beyond what PE groups offer. A recent study of the National Breast and Cervical Cancer Early Detection Program highlights how partnerships among academic institutions, hospital systems, and community organizations can significantly improve access to cancer screening and help reduce disparities in high-risk populations. This reinforces the importance of AMC-led care models that extend into communities while maintaining high clinical standards.

One such approach is the academic outpatient procedure center model, which significantly reduces facility fees, making procedural care more financially accessible while maintaining academic quality and patient safety standards-a counterpoint to concerns raised about rising costs and variable quality in PE-owned procedural services. Unlike existing university-operated outpatient facilities, which often mirror hospital-based structures in pricing and administration, these centers aim to streamline operations, reduce non-essential costs, and prioritize accessibility for a broader patient population, including the uninsured as well as those covered by Medicare and Medicaid. To make these centers viable against well-financed PE-owned outpatient clinics, AMCs must introduce distinct advantages beyond cost reduction. Patients could have access to cutting-edge clinical trials, advanced diagnostics, and novel therapeutics that are unavailable in commercial PE-backed settings, integrating research opportunities directly into clinical care. Unlike traditional university-affiliated outpatient departments, these centers would prioritize procedural efficiency while embedding research and innovation into routine care, allowing patients to benefit from early adoption of emerging technologies and treatments.

AMCs could use these outpatient centers as teaching environments that provide hands-on training for medical trainees while maintaining high-quality patient care. These centers offer a valuable opportunity for trainees to develop real-world clinical skills, cultural competence, and patient engagement beyond hospital settings. Furthermore, ensuring transparency in pricing, patient outcomes, and procedural appropriateness could distinguish AMC-led outpatient procedure centers from PE-backed facilities and reinforce their ethical commitments to accountability and equity.

To counteract the corporate consolidation of outpatient services, AMCs can collaborate with independent physician groups to create integrated care networks. Successful models include Cambridge Health Alliance and the University of California, Los Angeles’ (UCLA’s) partnerships with community clinics, such as the Venice Family Clinic, which deliver specialty care to underserved populations while providing clinical training for medical students. Additionally, UCLA’s community-based participatory research (CBPR) initiatives have addressed local health disparities, underscoring the sustained value of academic-community partnerships. AMCs can further extend their reach by embedding specialty clinics within primary care networks, integrating gastroenterology, oncology, and cardiology into underserved areas. Programs such as Johns Hopkins’ collaboration with federally qualified health centers and the University of New Mexico’s Project ECHO exemplify how integrating specialty services into primary care enhances access to high-quality, community-based care for vulnerable populations.

Policy Levers To Safeguard Community- Centered Academic Care

While institutional redesign is essential, policy must also function as a lever to reinforce the community-facing mission of AMCs. Regulation is not only about curbing consolidation or limiting market power-it’s about safeguarding the ability of academic institutions to provide equitable, community- based care. Without structural protections, AMCs may be increasingly displaced by financial entities whose goals are misaligned with public health. State and federal policy can and should insulate mission-driven systems from these pressures while empowering them to serve where they are needed most.

Several states have begun responding to these trends in meaningful ways. In California, Assembly Bill 3129 now requires the attorney general’s consent for private equity health care transactions. Crucially, the law applies not only to direct ownership but also to management services organizations (MSOs)-the vehicle PE firms often use to exert control without being classified as health care providers. This closes a long-standing loophole in acquisition oversight and allows the state to block deals that may reduce access or increase consolidation.

In Massachusetts, the Health Policy Commission (HPC) has implemented a Material Change Notice process, which allows oversight of significant market transactions, including those involving PE firms. The HPC has flagged several PE acquisitions in dermatology and orthopedics for their potential to raise prices and restrict access. The state is now proposing to expand this authority to include non-hospital outpatient acquisitions, in recognition of the growing threat posed by PE roll-up strategies.

Connecticut offers a slightly different approach. The state’s Office of Health Strategy monitors practice acquisitions and maintains a registry of physician group ownership, providing early transparency into market shifts. Connecticut also requires Certificate of Need review for certain practice affiliations and has seen its attorney general publicly challenge hospital and PE-linked deals, citing potential harm to access and cost. For example, Attorney General William Tong raised concerns about Yale-New Haven Health’s proposed acquisition of Prospect Medical’s Connecticut hospitals, highlighting the risk that a private equity firm’s debt burden could be transferred to a nonprofit academic institution. While the deal remains pending, the intervention illustrates that even large AMCs are vulnerable to the structural fallout of PE in health care. It underscores the role of state oversight in shielding mission-driven institutions

from inheriting unsustainable liabilities-reinforcing that policy must not only protect access and affordability but also insulate academic systems from financial models that prioritize exit over long-term outcomes.

At the federal level, oversight of private equity ownership remains limited and inconsistent. Establishing a national registry of physician practice ownership-including affiliations with PE firms and MSOs-would be a foundational step toward greater transparency. Meanwhile, the Federal Trade Commission and Department of Justice have begun to scrutinize serial acquisitions more closely, particularly those structured to circumvent conventional antitrust review thresholds.

For AMCs to reassert their role in outpatient care, these oversight mechanisms must be strengthened and extended. Transparency, regulatory review, and public accountability are essential if academic medicine is to remain a viable ethical counterweight to the financialization of care.

A Call To Action

The corporatization of medicine has significantly altered health care delivery in the United States, challenging AMCs to redefine their role in an evolving system. If AMCs fail to adapt, they risk losing their influence in outpatient care and becoming increasingly disconnected from the communities they serve. By embracing physician-led community partnerships, innovative outpatient care models, and policy advocacy, AMCs can reclaim their leadership in health care delivery. This is not merely an institutional concern-it is a call to action to preserve the integrity of patient-centered, research-driven medicine. The future of academic medicine must extend beyond hospital walls and into the communities that need it most.

AMCs have the power-and the responsibility-to lead this transformation, but they cannot do so alone. Sustained policy oversight, transparency in ownership, and safeguards against financial exploitation are essential to ensure that academic medicine can compete-and thrive-amid an increasingly corporate and ethically contested landscape.

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