Imagine Healthcare—the private equity–owned emergency medication group with some 70,000 wellbeing treatment pros staffing 540 health treatment amenities in 45 states—is in severe economic trouble. Creditors have missing self esteem in its capability to repay its huge financial debt. Envision’s $5.3 billion very first-lien phrase loan, because of in 2025, was investing in distressed-debt territory at the starting of March 2022, at 73 cents on the greenback and its senior unsecured take note because of in 2026 was investing at 53 cents on the dollar.
How did this take place to the premier U.S. medical professional staffing agency, owned by Kohlberg Kravis Roberts (KKR), one of the most financially prosperous non-public equity firms in the globe? How can KKR extricate by itself and secure its investment? And what happens to its medical practitioners and sufferers?
Non-public equity firms like to boast about their intently guarded “secret sauce” recipe for how they buy a organization, load it with financial debt, introduce new significant-tech methods that increase efficiency and profits, and exit at a profit. But KKR and Imagine exhibit these assertions are vacant. KKR acquired Visualize in 2018 in a leveraged buyout that burdened the corporation with billions in credit card debt. But KKR’s approach for paying out off the personal debt and garnering a superior return for its traders was purely reduced-tech.
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Until eventually lately, Envision’s unexpected emergency place health professionals did not belong to any coverage network. This permit Visualize send surprise clinical payments to people even when the clinic was in the patient’s insurance policy network. Loading clients who sought emergency care with usually unpayable healthcare debt was KKR’s magic formula sauce. It was as uncomplicated as that.
Envision’s reliance on shock billing turned clear by mid-2019. As public anger rose, Congress centered on the two major medical professional staffing companies engaged in this tactic, KKR’s Visualize and TeamHealth, owned by Blackstone. Both equally houses of Congress launched a joint, bipartisan monthly bill to ban shock medical payments that was predicted to pass by the stop of that calendar year. (It would consider a little bit longer.) In reaction to the general public outcry, Envision has brought many of its medical professionals in-network, employing the omnipresent menace that it could take them out-of-community to gather very high payments from insurers for healthcare procedures—a necessity if it
