Downright Inhospitable
Hospitals
For many Americans - especially those without health insurance - a hospital is the most utilized form of health care. Hospitals come in all shapes and sizes - some are attached to public universities, some are non-profits, and some are privately owned by for-profit groups like PE firms. The problem is, people do not have a say in who happens to own the hospital closest to them, but any adversity the hospital experiences can have a major impact on the quality and availability of care in a region.
We have talked about financial firms treating hospitals as investment vehicles. For years, Wall Street has poured billions into companies intent on consolidating hospitals into chains or flipping them for profit. A key driver of healthcare investment were low interest rates. Typically, buyout firms finance their acquisitions with debt, often loading hospitals up with gobs of it and selling underlying real estate to pocket quick gains.
Those of you who read the news may be aware that interest rates have gone up a lot in the last two years, which is not good news for firms sitting on mounds of debt. It is also not good news for the hospitals they bought, whose notes may be coming due:
“Private equity is looking at some of these hospitals now saying, ‘I don’t know what my exit is. There’s too many unknown variables. And the one thing private equity guys don’t like is unknown variables,” said Jim Clayton, who leads the private equity advisory practice at consulting firm BDO USA. “They thought that they could pretty them up and sell them to a larger health system. But the larger systems aren’t buying them. Because they don’t want the headache either.”
Won’t someone please think of the private equity guys? Sitting at their desks, simply agonizing over the fact they might not be able to flip their debt-laden hospital to a bigger buyout firm for massive profits? In seriousness, the debt crisis is a big problem that could impact some hospitals, but how many exactly?
Private equity owns almost 400 of the approximately 5,100 hospitals – or about 30% of all for-profits – in the US, according to the Private Equity Stakeholder Project, with more than 100 in non-urban areas. Rural and other safety-net hospitals are most at risk of closure because they have fewer privately insured patients, and, in the case of rural facilities, lower patient volumes.
Oh, cool! Only around ten percent of the country’s hospitals are owned by PE firms, and the ones most at risk of collapse are rural hospitals and facilities that serve the poor. Because of course.
It is a deep moral failing that we allow our hospitals to be bought and sold by profit-focused firms, who typically fire staff, cut costs, and sell off any assets the hospital may have. But it remains legal, and common practice across the healthcare industry writ large - it’s even worse in facilities that serve the elderly and infirm.
Our government could easily step in and, I don’t know, put any sort of law or regulation in place to stop the wanton profiteering. And they claim they want to! A bill recently passed a House subcommittee with bipartisan support. Have lawmakers of both stripes finally decided to stand up to the private equity vultures?
The House Energy and Commerce Committee unanimously passed a bill led by Republican Chair Cathy McMorris Rodgers of Washington in the spring that would require certain PE-backed businesses to disclose more information about their operations.
Ahhh yes, corporate transparency is clearly the answer here. If only firms would give Congress their balance sheets, we could avoid them closing hospitals and denying care to sick Americans when the mood strikes. That half-assed bill was immediately dissected by industry lobbyists:
To the chagrin of the committee’s Democrats, the pushback ultimately led policymakers to cut the private equity language from the GOP health transparency draft bill…
Obviously. Elsewhere, CMS - the federal agency tasked with overseeing hospitals - says it is ‘working on rules’ to ‘examine’ Wall Street’s ownership of hospitals, at some unspecified future date. And the SEC has finalized ‘sweeping’ transparency rules to force firms to give investors ‘clarity’ and disclose their fees. Because if investors saw how much PE firms were making flipping hospitals they’d be so outraged they’d pull the plug on the whole endeavor. Right. These two regulatory solutions could take months or years to have any impact, if they do at all. Meanwhile, interest rates continue to rise, and hospital owners under financial stress are free to dispose of bad assets.
The problem with for-profit hospitals is the problem with the privatization of any industry providing critical services to people. Even if PE firms could keep the lights on at every hospital they bought, their ruthless cost-cutting is forcing nurses and doctors out of the profession by the thousands. Their aggressive billing tactics are saddling millions of people with medical debt they can’t pay. In any country that’s allowed PE firms to take over health services, care gets worse and costs get higher.
Much of the US political apparatus does not believe health care is a human right, and our system reflects this cruelty. Now that the money spigot fueling the wave of hospital privatization has slowed to a trickle, firms are facing a choice - lose money, or shut the doors and walk away. It’s an easy, painless decision for financiers, but little consideration is given to the people who may depend on that hospital for critical services.
Heat
It feels like we read stories like this all too often:
More than 30 million low-income households that are eligible for federal funding to defray the cost of air conditioning have not received any money from a government program that was created to protect vulnerable people from dangerous temperatures, an E&E News analysis shows.
The funding isn’t reaching people in large part because the law and its interpretation are hopelessly outdated. Though the LIHEAP program was created in 1977 to help households pay for heating costs during the OPEC embargo, the bill was updated in the 1980s to allow for cooling assistance. So what gives?
Despite the warming climate - which we talk about a lot in these pages - air conditioning is still seen by politicians as a ‘luxury’, even in the growing list of places that grow dangerously hot. Instead, LIHEAP funding is heavily weighted toward regions that still utilize oil and gas for their heat:
Vermont has less than half the population of Hawaii. But in 2021, Vermont received nearly five times as much LIHEAP money — $53 million compared to $11 million, records show.
Connecticut, with 3.6 million residents, got $177 million in 2021. Florida, with 22.2 million people, got roughly the same — $183 million.
Connecticut spent nothing on cooling assistance. Florida spent more than 60 percent of its LIHEAP money to help residents stay cool.
Listen, it is rare that I go to bat for Florida, but poor folks living in a place where even the ocean is the temperature of a hot bath should receive critical assistance to ward off heat stroke. Could Florida’s legislators push to update the LIHEAP funding metrics, so unfairly skewed towards heating over cooling? Sure, but that would involve helping needy people, something they oppose politically:
Southern lawmakers have not sought to change the program in part because they are mostly Republicans and do not want to be associated with a welfare program, according to an official close to the program who asked not to be named to avoid antagonizing lawmakers.
Sadly, climate change is not bipartisan, and as a result millions of Americans who live in increasingly hot areas - it’s not just the South; Pennsylvania and Illinois are two of the four most heat wave-prone states - are at the mercy of outdated legislation from the ‘80s.
Barstool Sports
Barstool Sports is a media company run by a guy named Dave Portnoy. It is, essentially, a bunch of blogs and podcasts and social media accounts dedicated to what could politely be called ‘frat boy’ opinions and antics. Dave Portnoy is a polarizing figure, having made a name for himself as a bad boy - unfiltered, and often wildly offensive.
In 2020, Portnoy took his media empire legit - selling half the company to Penn Gaming to create a new Barstool sportsbook, in a play to turn his millions of rabid fans into equally rabid gamblers. It is a testament to how irresponsible the rollout of legalized gambling was that this person became the face of a betting brand:
Mr. Portnoy at times mocks the notion of gambling responsibly. He boasts that he typically wagers $25,000 a bet and as much as $500,000. He has encouraged fans to bet their “house, kids, family” on a single game. He has described gambling as “free money” and said it would be “wreckless” to not place a bet.
The owner of a sportsbook is not, legally speaking, supposed to be saying these things, but for years Penn Gaming insisted Portnoy was not involved in the operation of their gaming enterprise, so they received licensure in thirteen states to peddle their wares. Barstool personalities even got carveouts to bet on their own sportsbook while giving betting advice to their fans.
It is puzzling that executives at Penn were comfortable signing a half-billion-dollar deal with the creator of this sort of content:
Barstool ran a “Grading the Sex Scandal” column, which ranked the attractiveness of women accused of abusing children.
[…]
Another time, he wrote that Barstool did not “condone rape,” before adding: “However, if a chick passes out, that’s a gray area.”
But Portnoy was nothing if not a salesman. He’d convinced investors to pump millions into his operation in 2016, touting the site’s incredible reach with the coveted young male demographic. In 2020, he’d scored a 9-figure payout to make his site the face of online sports betting in America.
By 2023, however, the deal had soured, and Penn Gaming sold their stake in Barstool back to Portnoy for one dollar, inking a new partnership with ESPN. The company said it lost a staggering $800 million dollars on the venture. What happened?
Barstool Sports was supposed to be such a massive brand that its sportsbook would be successful via ‘earned media’ alone. According to Barstool’s own statistics, they reached a third of all 18-to-34 males in the country. And yet, their sportsbook venture was a flop, never capturing more than a tiny fraction of the online gaming market.
With the Penn Gaming deal in tatters, Portnoy admitted his media company was losing lots of money, and laid off a quarter of its staff. How was this possible, for a brand with such incredible reach?
The Daily Beast has a theory: Barstool Sports has spent years stealing and reposting content illegally to inflate its traffic metrics via social media. How does this work? The company operates dozens of anonymous burner accounts that rip and post copyrighted clips - sports games, songs, other peoples’ videos, etc - which the company uses its official accounts to embed and repost, garnering millions of views while dodging legal liability:
One anonymous account’s ripped video of The Weeknd’s Super Bowl LV performance racked up 36 million views for Barstool in less than 24 hours.
How did they get found out? One of their personalities let it slip during a taping:
After five seconds spent listening to the ’80s pop-rap hit, [Dan] Katz announced, unprompted, “We’re going to have to put this on a burner now.” The music continued, and an off-camera participant can barely be overheard chiming in, “Yeah,” with a laugh.
Then, they did just that:
The ChuckTamato tweet containing the video was posted at 4:24 pm ET. Barstool premiered the Sports Advisors episode on their website over an hour later. The only plausible way ChuckTamato could have gained access to a video which didn’t exist anywhere online was if Barstool was secretly running @ChuckTamato and uploaded the footage themselves.
While Barstool employees may have inadvertently outed their scam on a podcast, they were sophisticated enough to evade detection by Twitter and other platforms:
The burners never add any text along with the videos they swipe. This is important. A text-free tweet is impossible for anyone, Barstool or otherwise, to find via a Twitter search.
Though, again, not immune from doing dumb frat bro shit:
One since-suspended burner was, like the one discovered in 2019, set up using what appears to be a Barstoolsports.com email address; another burner was named after a website created by a Barstool podcast; one uses a two-decade old Portnoy alias; yet another uses a spoonerism of Portnoy’s name; and two burners are called a variation on “burner” in their display name.
It is impossible for an outsider to know how much of Barstool’s traffic comes from these stolen videos, but they may have contributed significantly to the site’s rise, and also explain why its cobranding efforts fell flat. Counting people who watch a video on social media as ‘traffic’ may entice investors and advertisers, but it didn’t translate into an appreciable share of the gambling market.
Portnoy is rich, and Barstool is still a popular media enterprise with much of its own original, non-stolen content. Will increased scrutiny of its antics drive advertisers away or cause any sort of crackdown on its content stealing? Maybe, but you’ll forgive me if I’m not optimistic. The type of misogynistic dreck Portnoy and his staff have churned out for years is, if anything, more popular these days, because a decent-sized chunk of the country has decided it’s not only okay but admirable to say offensive things out loud.
Sports Bars
Portnoy’s rise and fall does have a local angle for me, felt whenever I walk past the branded sports bar his company opened in my city. I have no idea whether it makes money or not, but I would not be sad if it shuttered as a byproduct of Portnoy’s recent cost-cutting measures.
While we’re on the subject, another impossibly gaudy sports bar in Philly closed recently, and while I was reading a post-humous account of the colossal folly I stumbled upon an eerily familiar name:
Martino, the tech investor from Bucks County who conceived the project five years ago and served as Bankroll’s chairman, said it was a combination of poor dealmaking on his part, fluctuating market conditions in the online-gaming business, and “people out to get us”…
Who is Paul Martino? This fuckin guy:
Martino is a guy who happens to have money and got mad that his kid’s school wasn’t reopening quickly enough during the pandemic. So he invested a modest amount of his wealth and got 30 right wing school board candidates elected across the state.
It’s a damn shame the rich dipshit who inflicted a bunch of antivaxx, Q-friendly school board candidates on the state of PA sank $20 million into a terrible sports bar that failed almost immediately. Martino is being sued by a bunch of people who claim he stiffed them, and I hope they all get their money. Every dollar out of his pocket is one less he can spend making the state a worse place to raise children.
Turkey
Speaking of assholes getting their comeuppance, a crypto guy from Turkey who stole a bunch of money just caught a prison sentence measured in millenia:
A Turkish cryptocurrency boss and his two siblings have been jailed for 11,196 years each for defrauding investors of millions of dollars.
Faruk Fatih Ozer, 29, fled to Albania in 2021 with investor assets after his Thodex exchange suddenly collapsed.
He was extradited back to Turkey in June and found guilty of money-laundering, fraud and organised crime.
Apparently, these sorts of sentences are common in Turkey since they outlawed the death penalty. A cult preacher got an eighty-six hundred year sentence for fraud and sex crimes, which, sure.
Absurdly long jail terms do not seem to be dissuading cybercriminals, however, who are fleeing Russia to set up shop there:
Cybercriminals in Turkey have teamed up with recently arrived Russian émigré hackers to flood a once moribund online marketplace with tens of millions of newly stolen personal credentials, an evolution in the transnational nature of such fraud.
Young men fleeing the war in Ukraine are taking their talents to Turkey, teaming up with the country’s budding young Internet fraudsters. We love an underdog story! What’s good for Turkey is bad for everyone else, though, as tens of millions of new stolen credit cards and passwords are appearing on marketplaces as a result of this new collaboration.
Short Cons
Guardian - “With four months of 2023 still left, the US has set a record for the most natural disasters in a single year that have cost $1bn or more, as fires, floods and ferocious winds were among deadly events experts warn are being turbo-charged by the climate crisis.”
WSJ - ““What’s he doing? Is he like at Lake Sunapee or something in New Hampshire?” CNBC host Jim Cramer said on TV about Calhoun in 2021, as the company dealt with mounting factory problems with its 787 Dreamliner, a wide-body jet. “I mean, what is he doing?””
NYT - “If successful, Wisconsin Republicans will have created, in effect, an unbreakable hold on state government. With their gerrymander in place, they have an almost permanent grip on the State Legislature, with supermajorities in both chambers.”
WIRED - “Using prisoners to train AI creates uneasy parallels with the kind of low-paid and sometimes exploitive labor that has often existed downstream in technology. But in Finland, the project has received widespread support.”
Guardian - “It seemed to confirm something that many observers had predicted: deprived of the prime time platform of Fox News, Carlson – once seen as a powerbroker in Republican politics and even a possible presidential candidate – has spiraled into extremism and growing irrelevance.”
NYT - “The F.D.A. has formally now concluded that phenylephrine, when taken orally, is “not effective as a nasal decongestant.””
SF Gate - “A cocktail party thrown by the Berkeley Property Owners Association in celebration of the end of the city’s eviction moratorium resulted in protests and even physical fights.”
New Republic - “Could driving someone to get an abortion soon be an act punishable by law? It’s not out of the question, if a newly emboldened group of extremists get their way.”
ABC News - “Now, Girardi stands disgraced, disbarred and charged in two states with bilking his clients. The Agatons are again fighting -- this time seeking accountability not from a corporate polluter but from the state of California and its agency responsible for rooting out corruption and crooks among the Golden State's 200,000 attorneys.”
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