Private equity investment in Sweden's primary care sector and regulatory responses to avoid risk selection

BACKGROUND: Until the 1990s primary care centres in Sweden were almost exclusively public and operated by the country's regions. A primary care reform in 2010 that increased competition between approved providers for public funding led to a rapid growth of private providers. Concerns were raised that profit-driven providers would select patients with lower risks. METHODS: We analysed contracts between county councils and private care providers and reviewed strategies employed by local governments to avoid risk selection and whether there were any differences between left- and right-wing governments. RESULTS: By 2020 over 270 new private primary care centres had been established, most of which were for-profit. Of the overall approximately 1200 primary care centres, about 60% are still owned by the regions and about 40% are privately owned. About a third of the private for-profit practices were owned by international private equity firms in 2018. Three main strategies were used by local governments to avoid risk selection: risk adjustment of the financial reimbursements on the basis of health and/or socio-economic status of listed patients; design of patient listing systems; and regulatory requirements regarding the scope and content of the services that had to be offered by all providers. Left-wing local governments were more prone than right-wing governments to adopt risk adjustment strategies at the onset of the reform but these differences diminished over time. CONCLUSIONS: A variety of regulatory instruments can be used to avoid risk selection by private providers. However, due to a lack of systematic research, no firm conclusions can be drawn so far on the overall impact of private equity ownership on primary care provision in Sweden.