SUMMARY: The 75th anniversary of St. Martin de Porres Hospital, now Allen Health and Rehabilitation, was celebrated in Mobile, honoring its historic legacy. Established in 1942 by Catholic medical workers as a maternity clinic for Black women, it became one of Alabama’s first hospitals serving Black patients and employing Black physicians during segregation. The 1950 facility uniquely catered to Mobile’s Black community, breaking barriers amid Jim Crow laws. A special mass at Prince of Peace Catholic Church commemorated the hospital’s impact on equality and community care. The event concluded with a reception at Allen Health, celebrating 75 years of progress and unity in healthcare.

St. Martin De Porres Hospital broke barriers, being one of the first hospitals in Alabama to serve Black patients and employ Black physicians and nurses during the Jim Crow era.

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by Anna Claire Vollers, Alabama Reflector
May 17, 2025

Private equity companies have gobbled up group homes and other services for people with disabilities, attracting the attention of state and federal regulators across the nation and alarming advocates.

People with intellectual or developmental disabilities have suffered abuse, neglect and even death while under the care of private equity-owned providers, according to a recent report from watchdog group Private Equity Stakeholder Project.

“Private equity firms are, more than many other types of investors, laser-focused on maximizing their cash flow, often trying to double or triple their investment over a relatively short period of time, usually just a handful of years,” said Eileen O’Grady, the report’s author. “The way that private equity firms will often do that is to cut costs.”

For companies that provide essential services for people with disabilities, she said, “those cuts can have really harmful impacts on people’s lives.”

In late 2023, Florida moved to revoke the license of NeuroRestorative, one branch of the private equity-owned health services company Sevita, which provides services for people with disabilities. State regulators cited repeat violations by NeuroRestorative and a failure to “protect the rights of its clients to be free from physical abuse.” Ultimately the state opted not to revoke the license and fined the company $13,000 in a settlement.

But in recent years regulators have documented instances of patient harm at Sevita’s affiliates in multiple other states, including Colorado, Indiana, Iowa, Massachusetts and Utah. In 2019, a U.S. Senate committee conducted a probe into the company’s operations in Iowa and Oregon following multiple reports of patient abuse and neglect.

“Any entity that receives taxpayer dollars, but especially those charged with caring for our fellow Americans who may have an intellectual disability, ought to be doing everything under the sun to ensure quality care and continually improve,” U.S. Sen. Chuck Grassley, an Iowa Republican, said in a statement in 2020 following his investigation.

In a statement to Stateline, Sevita did not address the sanctions directly, but avowed its commitment to providing services and supports to give people greater independence, regardless of their intellectual or physical challenges.

“Since 2019, when new ownership acquired the company, there has been significant capital investment to improve and expand our services, enhance facilities, implement robust training and new technologies, and strengthen our workforce — all with the goal of better serving our individuals and communities,” the statement said.

The disability care industry has proven increasingly attractive to private equity.

In recent years, a handful of large private equity-owned companies such as Sevita have snapped up hundreds of smaller providers of disability services — often community nonprofits, mom-and-pop businesses and religious organizations — and rolled them into larger corporations.

From 2013 to 2023, private equity firms acquired more than 1,000 disability and elder care providers, according to the report by the Private Equity Stakeholder Project. That’s likely an undercount because they’re generally not required to disclose acquisitions, the report said.

Cash cow

Private equity firms use pooled investments from pension funds, sovereign wealth funds, endowments and wealthy individuals to buy a controlling stake in a company. They seek to maximize its value — often by cutting costs — and then sell it at a profit.

Most of Sevita’s revenue comes from providing disability services. It operates companies in 40 states under various brands, including Mentor Network, NeuroRestorative and REM.

Sevita is currently owned by private equity firms Centerbridge Partners and Vistria Group, which also own Help at Home, a home health company with more than 200 locations across about a dozen states.

Nearly all of Sevita’s revenue comes from Medicaid, according to a February 2025 report from S&P Global.

Through Medicaid and Medicare, the government pays for most services for people with intellectual or developmental disabilities. The two programs cover services such as group homes, adult day programs, in-home care, and physical and occupational therapy.

“Sevita has been owned by private equity firms for over a decade now, and has been under investigation and scrutiny at the federal and state level for basically that entire time,” O’Grady said.

In 2022, Iowa fined a NeuroRestorative group home $10,500 after a resident was left unattended in a liquor store and drank three-quarters of a bottle of vodka. The same year, Massachusetts temporarily removed Sevita’s license to operate group homes after regulators reported inadequate staff training and supervision, and a “myriad of issues that were uncovered onsite,” according to a Massachusetts Department of Developmental Services report.

The federal Centers for Medicare & Medicaid Services has fined a NeuroRestorative facility in Utah four times since 2022. A February 2024 inspection report by the agency found the facility “failed to prevent abuse, neglect … and exploitation” of residents.

Last year, Florida fined another Sevita brand, Florida Mentor, for improper use of restraints. More issues have been documented in Sevita-owned locations in Arkansas, California, Colorado, Illinois, Indiana, New Hampshire and Nevada.

Meanwhile, Sevita’s owners, Centerbridge and Vistria, have collected nearly half a billion dollars since 2019 by loading Sevita and Help at Home with debt in order to pay dividends to investors, according to Moody’s, a financial services company.

Similar financial maneuvering contributed to the recent collapse of Steward Health Care, a private equity-owned hospital system that once had more than 30 hospitals nationwide. Steward has become a cautionary tale about the harm that profit-driven private equity firms can do to a state’s health system.

“Before Steward Health Care ultimately collapsed, executives spent years hiding their financial information from state regulators, putting patients and our health care system at risk,” Massachusetts Democratic House Speaker Ron Mariano said in a statement earlier this year announcing a new state law that beefs up reporting and financial requirements for private investors.

“That’s why ensuring that our institutions are equipped to monitor the health care landscape, and to guard against trends and transactions that drive up costs without improving patient outcomes, is so important.”

David vs. Goliath

After two residents of a New Jersey group home died from choking on food in 2017, attorney Cory Bernstein became interested in private equity’s involvement in disability services. The residents had been living in homes operated by AdvoServ, a company then owned by the private equity firm Wellspring Capital Management. The state had cited AdvoServ more times than any other operator in New Jersey for abuse, neglect and unsafe conditions.

AdvoServ later ceased operations in 2019 after multiple state agencies, including in New Jersey, Florida and Maryland, launched investigations.

But even when state regulators are doing all they can to protect people with disabilities from substandard care, they’re limited in how much they can hold a company accountable, Bernstein told Stateline.

“It’s state-level oversight on a national entity with not much [help] coming from the federal side,” said Bernstein, who is now a staff attorney at the National Disability Rights Network, a membership organization of federally mandated state disability advocacy programs.

“States just don’t really have the resources or tools to do what needs to be done.”

A regulatory agency in Georgia might shut down all the group homes owned by a certain company, for example, but those regulators can’t do anything about the company’s abuses in, say, Montana. With branches in multiple states, a company is better able to withstand sanctions or even a loss of license in one state, he said.

“[States] are not set up to go up against a national operator with billions of dollars in resources in a regulatory or oversight battle,” Bernstein said.

Further complicating things for state regulators and for consumers is that a large services company such as Sevita might operate under multiple brand names, even in one state. It can be hard to parse out who owns a sanctioned business. Multiple brand names can also obscure a company’s monopoly on a particular regional market.

When Florida regulators reached a settlement agreement with Sevita’s NeuroRestorative last year, the state dismissed its proposed license revocation. O’Grady believes one reason the state chose to settle is the difficulty of finding alternative facilities to relocate the residents who would have been displaced from the 13 locations the company operated around the state.

“Because of that dearth of alternatives and the impotence of the state to act more fully, this company will continue to be allowed to operate,” she said.

Further complicating oversight: Large companies often operate various services that are overseen by different agencies. Group homes might be regulated under the state’s Medicaid program, while facilities that provide more intensive care might come under federal Medicare oversight.

There could be “two completely different oversight systems for facilities serving the same population in the same state with the same name,” Bernstein said.

State solutions

Some states have moved to address problems with private equity involvement in health care by passing tighter restrictions on mergers and acquisitions of health care companies.

In Rhode Island, where private equity companies’ mismanagement of health care providers threatened the future of local hospitals, a robust oversight law allowed the state attorney general to impose conditions to protect the hospitals’ finances.

More states are following suit. In 2023 alone, 24 states enacted laws related to health system consolidation and competition, while this year at least half a dozen have considered legislation to check private equity-fueled health care mergers.

Stateline reporter Anna Claire Vollers can be reached at avollers@stateline.org.

Stateline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Stateline maintains editorial independence. Contact Editor Scott S. Greenberger for questions: info@stateline.org.

Alabama Reflector is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Alabama Reflector maintains editorial independence. Contact Editor Brian Lyman for questions: info@alabamareflector.com.

The post Private equity snaps up disability services, challenging state regulators appeared first on alabamareflector.com

Note: The following A.I. based commentary is not part of the original article, reproduced above, but is offered in the hopes that it will promote greater media literacy and critical thinking, by making any potential bias more visible to the reader –Staff Editor.

Political Bias Rating: Left-Leaning

The article presents a critical perspective on private equity firms involved in the disability services sector. It emphasizes concerns about the financial motivations of these companies and their impacts on the quality of care provided to individuals with intellectual and developmental disabilities. The language used frames private equity’s actions as harmful, focusing on instances of neglect, abuse, and regulatory failures. The inclusion of statements from watchdog groups, attorneys, and political figures like Sen. Chuck Grassley, who call for greater oversight and accountability, aligns the content with a left-leaning stance that advocates for stronger regulation and protection of vulnerable populations.

SUMMARY: Severe thunderstorms are forecast for Alabama this weekend with wind gusts over 60 mph, hail, and heavy lightning, though the tornado threat is low. Late Saturday night into early Sunday morning, a line of storms will move into northern Alabama, weakening as they progress south. Saturday afternoon will be mostly dry north of Birmingham with isolated storms south. Sunday will bring multiple rounds of scattered thunderstorms with a 40-60% chance of rain, especially in the Birmingham area. Monday is expected to be quieter, but more strong storms may arrive Tuesday night. Cooler, drier weather will follow midweek, with lows in the 40s and 50s by Friday.

Severe storms in Alabama’s Saturday and Sunday forecast with wind and hail, low tornado threat

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