When Senator Chris Murphy released his report A Dangerous Prospect: How Private Equity Decimated Connecticut Hospitals earlier this month, he framed it with a personal story. Growing up, Murphy recalled seeing his pediatrician, Dr. Carleton, who knew his family and provided continuity of care. “My kids have a very different experience,” he wrote. Instead of the familiarity of a family doctor, they now see whichever pediatrician is available. What surprised him most was discovering who controlled the practice: “The primary investor in my children’s pediatric practice is Goldman Sachs, a Wall Street investment bank.”
This new reality, Murphy argued, reflects a seismic shift in American health care. Less than half of physicians now work in private practices, while private equity has poured $1 trillion into health care transactions over the last decade. The effects are visible nationwide: stressed staff, missing supplies, doctors replaced by call centers, and a system that leaves patients paying more while receiving less.
The senator’s report zeroes in on three hospitals in Connecticut—Waterbury Hospital, Rockville General, and Manchester Memorial—that were acquired by Prospect Medical Holdings, a private equity-backed firm. Their story, Murphy contends, shows how Wall Street’s financial model “squeezes the life out of hospitals and doctor’s offices, and then leaves patients and communities in the lurch.”
When Prospect Medical Holdings acquired the three Connecticut hospitals, it promised capital investments and improved facilities. Instead, staff describe dangerous shortages and crumbling infrastructure.
Ramona, an operating room assistant at Waterbury Hospital, explained how Prospect’s refusal to pay vendors left patients in peril. “One patient was on the operating table for 45 minutes while staff was waiting for the mesh needed to close the patient up after supply ordering protocols had become very restricted.” Staff said that before Prospect’s acquisition, “all supplies were laid at the bedside before the patient was even given anesthesia.”
The shortages extended beyond the operating room. Staff reported buying pens, paper, and even food for patients with their own money. Nurses recalled going out of pocket to ensure patients would not go hungry.
Anne-Marie, a nurse at Manchester Memorial for more than three decades, described the toll on morale: “You know, I’m very fortunate where I work that we still care and patients can’t believe what a good job we do despite all of the obstacles and hurdles we’ve been given…we still show up every day and we’re committed to our communities, thankfully.”
At Waterbury, the physical plant deteriorated so badly that ceilings began collapsing. Carmen, a unit secretary, recounted two separate incidents. “We were lucky enough that the patient had already been discharged and where it fell, it would have missed the stretcher and the patient. The other time it fell in the trauma room, it was only on top of the computers…so we called maintenance, and they came and fixed it, [which means] putting a little hose where the water is and putting buckets to catch the water…it’s happened a lot.”
Medical equipment broke down as well. Ruth, who worked in patient transport at Waterbury, described malfunctioning stretchers: “Sometimes you hear them…squeaking. A lot of them [are] rusting. Sometimes the brakes are broken…we feel that’s a danger to the patient as well.” In one case, she said, “thank God the patient was a twenty-year-old that was able to get off the stretcher” when it collapsed.
At Manchester, Prospect cut staffing so deeply that there was no longer a doctor available on overnight shifts, creating dangerous delays in emergencies. Elevators often broke down, impeding care. One physician went from being proud to work there to saying he would not recommend his own family be treated at the hospital.
By 2019, Waterbury recorded the highest patient readmission rates in Connecticut. At Manchester, a woman died after an emergency C-section was performed too late, resulting in a stillbirth.
Behind these deteriorating conditions was what Murphy’s report called the “private equity playbook.” Leonard Green & Partners, the private equity firm that owned Prospect, systematically extracted wealth from the hospitals.
In 2018, Leonard Green forced Prospect to borrow $457 million to pay itself a dividend, even as the company recorded a $244 million net loss. The firm also sold the land under the hospitals for $1.4 billion to Medical Properties Trust, a real estate investment trust, and forced the hospitals to lease it back at high rates.
When Leonard Green exited its investment in 2021, Murphy wrote, it left “nothing but debt and destruction” behind. Rockville Hospital, stripped of services, cut all but emergency and outpatient mental health care without required state approval.
By January 2025, Prospect filed for bankruptcy, leaving the fate of all three hospitals in the hands of a Texas judge. Employees and patients were left with uncertainty, while executives walked away with wealth.
Sam Lee, Prospect’s CEO since 2007, maintained two Los Angeles mansions worth more than $15 million combined, complete with pools and a private basketball court. Murphy noted: “Sam Lee pillaged three Medicaid hospitals in Connecticut so he could have two mansions 11 minutes apart.”
Connecticut’s crisis is not unique. In 2024 alone, private equity made over 1,000 health care deals and, as of April 2025, owned nearly 500 hospitals, or 8.5% of all privately owned facilities. Private equity has also targeted physician practices and nursing homes.
The consequences are measurable. A Johns Hopkins study found nursing homes owned by private equity had an 11% higher mortality rate. A Columbia University review of 55 studies concluded that private equity ownership increased health care costs by up to 32% without improving patient outcomes, sometimes directly harming patients. The authors titled their findings bluntly: “Private Equity Takeovers are Harming Patients.”
The devastation at Waterbury, Rockville, and Manchester prompted Connecticut lawmakers to try to act. In 2025, state legislators introduced bills to strengthen oversight of health care transactions and even to ban private equity ownership of hospitals.
Both efforts collapsed under pressure from industry lobbying. Representative Cristin McCarthy Vahey, co-chair of the Public Health Committee, remarked, “private equity makes big tobacco look small.” Representative Liz Linehan compared its influence to a cancer: “We’ve waited so long that now this tumor can’t just be excised out.”
McCarthy Vahey described how lobbyists swarmed at the end of the session: “ten of them, or twelve of them, objecting to the current version of the bill.” She said the strategy was clear—wait until the last possible moment to derail reform.
The timing could not be worse. On July 1, 2025, Congress passed and President Donald Trump signed into law the “One Big Beautiful Bill Act,” which imposed sweeping cuts to Medicaid. Murphy’s report warned that these changes would push more community hospitals to the brink, leaving them vulnerable to private equity takeovers.
Researchers at Yale and the University of Pennsylvania projected that “hundreds of thousands of people will die because of this law.” Meanwhile, the bill delivered new tax breaks for billionaires, further enriching the same class of investors profiting from hospital collapses.
Murphy’s report concludes with a warning: “The story of these three Connecticut hospitals is playing out in healthcare systems all over the country. Private equity comes in, squeezes the life out of hospitals and doctor’s offices, and then leaves patients and communities in the lurch.”
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