Conemaugh Hospital may be in trouble: A creative proposal called the “Take Back Our Hospitals Act” will eliminate private equity firms

Conemaugh Hospital

Some members of Congress are attempting to improve the American health care system by eliminating ownership of hospitals and nursing homes by organizations that they believe have been destroying the system.

This would have a tremendous impact in the state of Pennsylvania, including in Johnstown, Pa., where the sole hospital was taken over more than a decade ago by a group financed through a private equity firm. Questions about the future of this organization have abounded in recent years, indicating that Conemaugh and Duke/Lifepoint Healthcare, which purchased the system 12 years ago, were parting company.

In addition, a bipartisan Congressional investigation into Apollo Global Management, which owns Lifepoint, was very critical of the organization’s purchase of more than $1 trillion dollars that it spent on healthcare businesses.

Consequently, two Congressional leaders have introduced legislation that will would deny hospitals and skilled nursing facilities funds through Medicare if they are owned by a private equity company.

That would effectively put private equity firms out of the healthcare business.

Legislation and background

The “Take Back Our Hospitals Act of 2026” was introduced in the House by a Pennsylvania Democrat, Mary Gay Scanlan, and in the Senate by Connecticut Sen. Chris Murphy, a Democratic leader.

Scanlan was led to act because of the debacle in Delaware County by Crozer Health, which was forced into bankruptcy and closed hospitals because of the private equity firm Prospect Medical Holdings,

The Take Back Our Hospitals Act would deny hospitals and skilled nursing facilities Medicare funds if they are owned by a private equity company, effectively prohibiting private equity ownership of these providers.

Private equity investment in health care has grown from $5 billion in 2000 to an estimated $104 billion in 2024.

The result has been higher prices, worse care, mass layoffs, and a record number of health care bankruptcies, Scanlon said.

“Private equity used Crozer as a piggy bank, ruthlessly and systematically draining what was once a four-hospital health system of every penny, and healthcare in Delaware County is still destabilized today, a year after Crozer’s doors closed,” said Maureen May, RN, president of PASNAP, the Pennsylvania Association of Staff Nurses and Allied Professionals, which represents more than 11,000 frontline caregivers across Pennsylvania.

Prospect Medical Holdings acquired the Crozer Health system with the promise of investment and better healthcare.

Instead, it drove Crozer into bankruptcy, closed four hospitals, laid off 2,600 health care professionals, and left Delaware County with just two hospitals to serve 585,000 residents, Scanlon said.

“Private equity’s general business model is pretty simple: find hospitals that are in dire financial straits, make promises to fix things, and then squeeze every cent they can out of patients before leaving communities to deal with the wreckage,” said Senator Murphy.

Congresswoman Scanlon website, March 2026

Senate investigation criticized Lifepoint/Apollo in 2025

An investigation conducted in 2024 found that two private equity firms oversaw operations that reduced the quality of health care in two instances,

A yearlong bipartisan congressional investigation into two private equity-backed U.S. hospital systems found that patient care deteriorated at both operations as their private equity owners reaped significant payouts on their investments in the systems. The findings reinforced academic research showing how private equity health care investments harm patients while enriching investors. 

The investigation was helmed by two senators who lead the Senate Budget Committee — Sheldon Whitehouse, a Rhode Island Democrat, and Chuck Grassley, an Iowa Republican.

The inquiry centered on private equity giant Apollo Global Management, owner of Lifepoint Healthcare, the nation’s largest operator of rural hospitals, and Leonard Green & Partners, a private equity firm in Los Angeles that owned hospitals under the Prospect Medical Holdings umbrella from 2010 to 2021. 

“Private equity reduces patient care while enriching investors,

Senate report finds,” NBC News, Jan. 8, 2025

Tremendous corruption

This was a trillion dollar operation and has led to corruption on a large scale,

Over the past decade, private-equity firms like Apollo and Leonard Green have spent more than $1 trillion buying health care businesses, including hospitals, nursing homes, physician practices and hospital staffing companies. To finance these deals, private equity owners typically burden the companies they buy with debt, then slash company costs to increase earnings and appeal to potential buyers in subsequent years.  Because private equity firms do not make public the financial results of the companies they own, Senate investigators aimed to assess how much profit the private equity firms generated from their investments in the hospitals and whether the deals harmed patients. 

“As our investigation revealed, these financial entities are putting their own profits over patients, leading to health and safety violations, chronic understaffing, and hospital closures,” Whitehouse said in a statement. “Private equity investors have pocketed millions while driving hospitals into the ground and then selling them off, leaving towns and communities to pick up the pieces.”

NBC News

Local response to the investigation

According to a Johnstown television report after the release of the report more than a year ago, the Congressional investigation caused a defensive response from Lifepoint,

Lifepoint Health, which owns and operates Conemaugh Health System in Cambria County, is responding to a recent Senate investigation that claims that the healthcare system prioritizes profits over patient care.

According to a report published this week by NBC, the year-long, bipartisan Congressional investigation reportedly revealed that two private equity groups --- including Lifepoint’s parent company --- Apollo Global Management --- focused on lining its investors pockets rather than providing quality care to patients.

The report alleges that the two groups spent over $1 trillion in the past decade to purchase various healthcare businesses nationwide.

Lawmakers claim that the investments into these businesses were purely profit-based, resulting in diminished patient care, particularly in rural and underserved areas.

The report further claims that the equity groups would go as far as cutting hospital costs and staff in order to further protect their profit margins.

“Lifepoint defends care quality amid Senate inquiry into

private equity practices,” WJAC-TV, 2025

However, the organization, which purchase the non-profit Conemaugh Health System in 2014, attempted to refute this investigation,

Lifepoint is dedicated to providing quality healthcare to people around the country, often serving as the only provider in many of our nation’s rural and underserved communities. In the face of many challenging industry and community circumstances, we have worked diligently to expand access to care and bring quality providers, caregivers, and technology to address our patients’ needs.

WJAC-TV News

Conemaugh’s struggles in recent years

Patient care at Conemaugh has been controversial for many years. Stories abound about how patients end up spending long periods of time in the emergency room because staffing shortages do not permit them to open the entire hospital.

In 2023, the CEO attempted to defend the institution’s efforts in a story in the Johnstown Tribune-Democrat. However, the interview with Rodney Reider noted that many beds are not in use because of the staffing shortages,

Most of Memorial’s inpatients are admitted through the emergency department, he explained. Staffing shortages often mean there are now beds in the medical-surgical units that are staffed and set up for patients. That can leave patients in temporary locations in and around the emergency department for hours or even a few days.

Although Memorial is licensed for 536 beds, about 200 are not in use on any given day because of staffing shortages. Measures have been put into place to reduce the time it takes to get lab work and imaging tests completed, so efforts are now focused on getting emergency department patients transitioned into rooms as inpatients.

Randy Griffith, “Conemaugh hospital chief: “We’re rebuilding,”

Tribune-Democrat, Sept. 28, 2023

Reider indicated that Conemaugh hired 120 new physicians in 2022 after a “significant drop” in 2021. These are the kinds of problems that are often attributed to organizations after they are taken over by private equity firms.

That is the root of the Take Back Our Hospitals legislation, and the success may impact the ownership in places like Johnstown.