An Oregon law passed more than a year ago is part of a cascade of similar state laws nationwide that are making it harder for private equity firms to take over services from health care facilities, according to a new industry report.
Private equity deals for health care services nationwide have decreased 18.5% over the last year from the second quarter, which lasts from April to June, of 2025 to 2026, according to areport published last weekby PitchBook, an industry research platform for private equity and financial markets. The report found that deals allowing private equity firms to take control of the management services of a clinical practice have decreased nearly 36%, from 111 to 71 over the same time period.
The report partially attributed these developments to increased state scrutiny of these deals, citing “tighter regulations slowing deal processes.” It pointed to several different states’ laws aimed at limiting the corporate takeover of medicine, including a 2025 Oregon law which prohibits the ownership of local health clinics through management services organizations and prevents these organizations from having majority control or ownership over a practice.
The lawpreventsentities such as corporations or private equity firms from relying on out-of-state physicians they work with to own the clinical side of a practice while they retain control of the administrative or billing services of an organization.
“Oregon’s (Corporate Practice of Medicine) restrictions, which went into effect in January 2026, aimed at limiting the use of the ‘friendly physician’ model,” the report reads. “Combined, these developments are lengthening transaction timelines, increasing deal costs and complexity and making serial roll-up strategies more complicated to execute.”
The Lake-Oswego based Oregon Medical Association, a professional organization supporting physicians, welcomed the report’s findings but said it needed “some time to analyze the report.”
“That said, this is a positive development if it means that PE-backed deals that edge out clinical decision making in favor of corporate interests are becoming harder to put in place,” Courtni Dresser, the association’s vice president of government relations, said in a statement. “We’ll keep watching how it plays out in practice, but our focus remains the same: making sure physicians, not investors, are the ones making medical decisions.”
Enforcement questions continue to grow
Oregon’s law gained support in the 2025 sessionin the wake of the healthcare giantOptum’s takeover of the Eugene-Springfield-area Oregon Medical Group, which prompted the loss of dozens of doctors in the area who were forced to sign agreements that would block them from working for other area medical practices should they leave the company. Optum reversed course after pressure from lawmakers in May 2024, and Oregon’s law rendered such agreements largely unenforceable.
Oregon Democrats have yet to make an explicit commitment to doing so, but somelawmakers have suggested thatthe 2025 law needs more enforcement provisions to be passed in a future legislative session. Similar critiques have come from groups such as the Oregon Medical Association,which notes that the lawis not enforced through state-backed agencies but instead by medical clinics taking legal action.
Although the 2025 law has yet to be used to stop such a deal for private equity, the measure was at the center of a federal court case in which emergency doctors in Lane County achieved a settlement with the nonprofit healthcare system PeaceHealth earlier this year after raising alarm over their potential replacement through a national staffing company, ApolloMD, based in Atlanta, Georgia.
PeaceHealth maintained that its arrangement was in compliance with state law. But ApolloMD created a local emergency physician firm in Lane County through agreements that U.S. District Judge Mustafa Kasubhaisaid functioned asa “handshake and a wink”andallowed ApolloMD to conceal whether the company was influencing the firm’s decisions.
Rep. Nancy Nathanson, D-Eugene, echoed those sentiments in a Tuesday statement, arguing that “we can’t expect a local physicians’ group to take on a giant national corporation in court by itself.”
“That’s why we need to give our attorney general and Department of Justice the tools to put real teeth into our laws and protect Oregon’s health care consumers,” she said in a statement. “When people need health care, they need health care, and they deserve to know the laws protecting them will be enforced.”
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