Private Equity, Mortality, and Crime: Evidence from Opioid Treatment Programs

• In Event: Dying for Care: How Policy Shapes Opioid Mortality and Treatment Access

Abstract

Private equity (PE) is known to lower care quality for its own patients, and we ask whether the cost stops there. Opioid treatment programs (OTPs), the only outpatient source of methadone for opioid use disorder, add counseling and medical care, and because treatment reduces local crime they also protect public safety. By 2020, PE owned more than a quarter of them. A staggered difference-in-differences design around acquisitions shows methadone volume unchanged while the clinic offers less payment assistance and less general substance use treatment. County opioid deaths rise 2.4 per 100,000, 29 percent of the pre-acquisition mean, and violent offenses rise 8 percent. Entry tells the same story: deaths and violent offenses rise where a PE-backed OTP opens, not where a non-PE-backed one does. In settings where firms produce positive externalities, PE acquisitions deserve scrutiny beyond the service sold.

Author

• Lance Gui, University of Mannheim
  Presenting Author