In the United States, private equity has for several years inspired both fascination and growing distrust. While the industry continues to attract massive capital and to generate substantial investment returns, it has also become a political, media and social target. This defiance now plays out on several fronts: criticism from towering figures such as Warren Buffett, Donald Trump’s push to regulate healthcare deals, and an increasingly hostile public opinion, particularly regarding the effects of PE in sensitive areas such as hospitals and residential real estate.
1. Warren Buffett: the Oracle of Omaha’s scepticism
Warren Buffett, the tutelary figure of American capitalism, has never minced his words about private equity. At Berkshire Hathaway’s 2023 annual meeting, he remarked with irony:
« When you look at some of the adjustments that are made in private equity — they’re really pushing the envelope. »
He was denouncing the “adjusted EBITDA” figures often used to embellish performance and mask the economic reality of acquired companies. Buffett also criticises the systematic use of leverage:
« Leverage can make a good investment better, but it can also make a bad investment lethal. »
He questions the sustainability of certain models, pointing to a sometimes skewed alignment of interests: high fees, overly short exit horizons, and asymmetric incentives.
2. Donald Trump: regulating private equity in healthcare
During his campaign for a second term, Donald Trump seized on an explosive issue: the role of private equity in the deterioration of the American healthcare system. At a rally in Ohio in April 2024, he declared:
« We’re not going to let these hedge funds buy hospitals and cut staff to boost profits. We’re going to bring back real care in health care. »
Behind the rhetoric, a concrete commitment: Trump promised to sign a law banning certain types of LBO in the hospital sector — notably highly leveraged deals or those involving “non-transparent” funds — though he ultimately gave up taxing carried interest in the “Big Beautiful Bill” passed on 4 July 2025. This populist, protectionist stance takes aim at a clear target: hospital buyouts by funds such as Cerberus (via Steward Health Care), Apollo (LifePoint) and KKR (Envision Healthcare), accused of closing emergency departments, carrying out mass lay-offs and degrading the quality of care.
A 2023 report by the Private Equity Stakeholder Project noted:
« Envision Healthcare, after its 2018 buyout by KKR, saw its debt balloon to more than $7 billion, while the quality of care was seriously called into question. »
Trump, far from being hostile to PE as a whole, is here exploiting an emotional issue: health. He pits finance against compassion, and funds against doctors.
3. Public opinion: PE, predator or saviour?
Criticism does not only come from the top. A growing share of American opinion sees private equity as a destructive force: in hospitals, where emergency rooms close in the name of financial rationalisation; in nursing homes, where fund buyouts are associated with falling standards; in real estate, where firms such as Blackstone are accused of contributing to rent increases.
A Pew survey in late 2024 found that 61% of Americans believe private equity has a negative impact on the economy — up 15 points since 2020. This perception is reinforced by hard-hitting investigations such as the New York Times’ 2022 report on PE-controlled nursing homes:
« Nursing homes owned by PE firms saw a 10% increase in mortality, linked to staff cuts and cost optimization. »
4. Towards targeted regulation?
Under popular pressure, regulation is evolving. The SEC, under chairman Gary Gensler, has since 2022 tightened transparency and reporting obligations for PE funds. A landmark reform has required, since 2024, that all hidden fees and side-letter agreements be disclosed to LPs.
More recently, several Democratic senators, including Elizabeth Warren, have proposed the Stop Wall Street Looting Act, aimed at restricting LBOs in so-called “vital” sectors (healthcare, defence, social housing). Warren, true to her cause, denounces:
« PE firms have become financial predators — extracting wealth at the expense of workers, patients, and communities. »
5. Defending PE without naivety
Faced with these criticisms, professional associations such as the American Investment Council and the NVCA defend PE’s role in innovation, the growth of SMEs, and the modernisation of struggling sectors. An AIC report from March 2024 stresses:
« PE-backed companies employ over 12 million Americans and consistently outperform peers in job creation and productivity. »
We will soon return to PE’s positive impact in a dedicated article: PE: a powerful engine of growth, jobs and corporate transformation.
Two recent focal points
1. The data behind an accelerating penetration
A joint study by Oregon Health & Science University, the Wharton School (University of Pennsylvania) and the Yale School of Public Health, published in JAMA Psychiatry in July 2024, analyses private equity’s growing footprint in US mental healthcare.
Key data: between January 2012 and July 2023, PE funds acquired 642 mental health clinics and 1,152 addiction treatment centres — 6.2% of all mental health facilities and 7.1% of substance-use disorder centres. In some states (Texas, Colorado, North Carolina), penetration exceeds 25%. The researchers note a worrying absence of data on the impact of these buyouts on quality of care, costs and accessibility.
« There is this dearth of treatment, and it seems like private equity has taken advantage of some of those opportunities. » — Marissa King, professor, Wharton School
« Where we worry the most is where we are seeing costs increase, but we’re not seeing improvement in outcomes. »
Sources: JAMA Psychiatry study (July 2024) · Wharton Knowledge article · OHSU press release
2. FTC–DOJ–HHS public inquiry: towards targeted regulation
On 5 March 2024, the Federal Trade Commission (FTC), together with the Department of Justice (DOJ) and the Department of Health and Human Services (HHS), launched an unprecedented public inquiry into private equity’s impact on the American healthcare system.
The inquiry aims to identify the effects of unreported acquisitions (outside the scope of the Hart–Scott–Rodino Act) and to assess the consequences for quality of care, price increases, excessive market concentration and clinical staffing cuts.
« When private equity firms buy out healthcare facilities only to slash staffing and cut quality, patients lose out. » — Lina Khan, FTC Chair
« This RFI will enable the agencies to accurately understand modern market realities… and forcefully enforce the law against unlawful deals. » — Jonathan Kanter, antitrust chief, DOJ
Regulatory outlook: the “Private Capital, Public Impact” workshop (March 2024) aired public criticism of the PE model in healthcare. Identified risks include unreported but anti-competitive roll-ups and rapid “strip-and-flip” divestment strategies in critical clinical areas. The inquiry was open to public comment for 60 days; regulatory or judicial action may follow.
Sources: official FTC release · legal analysis (Goodwin)
Conclusion
American private equity stands at a crossroads. Adored by investors but watched by politicians, it must now demonstrate that it can create value responsibly, particularly in sensitive sectors. The lucidity of Warren Buffett’s criticism, Trump’s virulence on healthcare, and the public’s growing hostility, relayed by official inquiries, demand an aggiornamento.