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PERSPECTIVE

2077

Restoring Confidence in Public Health

n engl j med 393;21 nejm.org November 27, 2025

vestment in public health mea- sures for both individual people and society overall. Simultane- ously, community leaders, reli- gious leaders, and even politicians will need to work together toward renewal of the social contract en- suring that health benefits are disseminated to everyone.

In the near term, everyone in- volved in public health can act to make a difference. On a daily ba- sis, we need to redouble our ef- forts to convey complex concepts clearly and accompany our expla- nations with concise descriptions of the relevant uncertainty. We also must take the time to have extended dialogues with people who have questions about public health topics and to work through their preconceived notions and concerns. Even if such exchanges don’t change minds, patient and respectful dialogue can help re- store trust among people along

the entire socioeconomic spec- trum. In addition, if this effort is to succeed in today’s environment, everyone involved in public health and particularly public health lead- ers will need to recognize the importance of the powerful and prolific communication of accu- rate information through multi- ple widely accessible platforms.

Finally, every single person in- volved, from frontline workers to national public health leaders, will need to commit wholeheart- edly to the truthfulness, shared exchange, and mutual respect that are essential to advancing public health. The current situation, in which public health has been woe- fully undermined, must change; that will happen only if we all individually do something about it. As former U.S. Surgeon General C. Everett Koop noted, “Health care is vital to all of us some of the time, but public health is vital

to all of us all of the time.”5 Be- cause public health is critical for sustaining human well-being, all of us must have the courage to take on its current challenges.

Disclosure forms provided by the author are available at NEJM.org.

1 Washington, DC.

This article was published on October 8, 2025, at NEJM.org.

1. Winslow CE. The untilled fields of public health. Science 1920; 51: 23-33. 2. Gostin LO, Wiley LF. Public health ethics and law. Hastings Center for Bioethics. Septem- ber 23, 2015 (https://www . thehastingscenter . org/ briefingbook/ public - health/ ). 3. Hulland EN, Charpignon M-L, Berkane T, Majumder MS. Underimmunisation dur- ing the 2025 Texas measles outbreak. Lancet Infect Dis 2025; 25: 607-9. 4. Goleman D. Emotional intelligence: why it can matter more than IQ. New York: Ban- tam Books, 1995. 5. Koop CE. Health and health care for the 21st century: for all the people. Am J Public Health 2006; 96: 2090-2.

Venture Capital Investments by Medical Centers

Venture Capital Investments by U.S. Academic Medical Centers Nishant Uppal, M.D., M.B.A.,1 and Zirui Song, M.D., Ph.D.1‑3

In this new era of uncertainty about traditional sources of rev-

enue — particularly federal re- search funding and public insur- ance programs — U.S. academic medical centers (AMCs) may be- come increasingly reliant on alter- native revenue sources. One emerg- ing source, as demonstrated by financial data on leading AMCs, may be returns from venture capi- tal investments.

In recent years, AMCs have in- creasingly developed their own venture capital divisions. Venture capital funds invest in startup companies, with targets including basic-science discoveries that may lead to new therapeutics, digital

technologies for managing chronic diseases, and other emerging tech- nologies for diagnosing illness or delivering care. AMCs use venture capital to generate revenue both by commercializing their own dis- coveries and by investing in other promising areas.

Venture capital differs from pri- vate equity, another form of invest- ment. Whereas private equity firms typically acquire majority or full ownership stakes in established businesses, venture capitalists buy small, minority shares of new companies, often without owner- ship control, enabling the entre- preneur to continue leading. And whereas private equity firms typi-

cally sell investments several years after acquisition, with fairly as- sured returns on investment, ven- ture capitalists often hold invest- ments for longer periods, looking for more pronounced, though less certain, returns.

Over the past 15 years, venture capital investment by hospitals or health systems affiliated with a university or medical school has grown rapidly. Since 2010, the ven- ture capital funds affiliated with 10 leading U.S. AMCs collectively participated in at least 453 in- vestment deals, with a cumulative deal size of approximately $12.1 billion and an average deal size of $26.8 million (see graph).

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Venture Capital Investments by Medical Centers

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The initial capital used to es- tablish a venture capital fund typi- cally comes from external inves- tors or “limited partners.” In the case of AMCs, however, venture capital funds may be structured within the parent organization, often using in-house resources to finance some investments. In oth- er instances, external institutions provide startup capital for such funds. Limited partners for AMC venture capital funds have includ- ed pension funds, charitable foun- dations, and pharmaceutical com- panies.

The 10 AMC funds whose ven- ture capital activity is shown in the graph made a combined 8 such investments in 2010, which in- creased to a peak of 54 invest- ments in 2021. The most popular health care industries for these investments, based on cumulative

deal size in the period 2010–2024, were drug discovery ($4.2 billion), biotechnology ($1.5 billion), health care technology systems ($1.1 bil- lion), enterprise systems ($807 mil- lion), clinics and outpatient ser- vices ($668 million), laboratory services ($533 million), and ther- apeutic devices ($531 million).

Venture capital investments may have important implications for AMC finances. For years, industry reports suggested that AMCs that cared for a disproportionate num- ber of patients covered by Medi- care and Medicaid were more fi- nancially distressed than health care entities that predominantly cared for people with commercial insurance, with the costs of train- ing medical students, residents, and fellows exacerbating finan- cial pressures.1 One indicator of a health system’s financial status is

operating margin (the difference between revenues and costs asso- ciated with delivering patient care, divided by total revenue from patient-care services). AMC oper- ating margins have reportedly decreased in recent years, with a median operating margin in 2022 of 1.5%, as expenses have grown faster than revenues, driven in part by high nursing costs during the Covid-19 pandemic.1 In sur- veys, AMC leaders have reported that their primary strategies for responding to financial pressures include reducing lengths of stay, increasing physician productivity, and enhancing revenue-cycle man- agement (e.g., billing and cod- ing) and payer contracting (e.g., negotiating for higher prices).1 These approaches resemble tradi- tional hospital financing strate- gies dating back to the 1980s.

More recently, however, the fi- nancial performance of AMCs has increasingly been affected by fi- nancial markets. Despite stable patient-care revenue as a share of total revenue, many large non- profit hospital systems reported substantial financial losses be- tween 2021 and 2022. Losses as- sociated with stock market invest- ments accounted for about 85% of financial losses during this period (such losses materialize if these investment assets are sold when prices decrease, but the losses could dissipate if investment as- sets are not sold and prices even- tually recover).2 Large hospitals continue to face rising expenses, including increasing labor costs, which they manage in part with proceeds from investment divi- sions (which could include venture capital funds). The performance of these divisions — along with hospital bond ratings — is a key measure of hospital financial per-

Venture Capital Investment Deals Involving 10 Selected Academic Medical Centers, 2010–2024.

Venture capital funds included are Mayo Clinic Ventures, Cleveland Clinic Ventures, Mass General Brigham Ventures,NewYork–Presbyterian Ventures, Cedars–Sinai Health Ventures, UPMC Enter‑ prises, Mount Sinai Ventures, Orlando Health Ventures, Northwell Holdings, and University Hos‑ pital Ventures. Limited partners and parent companies include Astellas Pharma Pension Fund, ShangPharma Innovation, Simcere Pharmaceutical Group, Brigham and Women’s Hospital, Chipstone Foundation, Dunn Family Charitable Foundation, Edgerley Family Foundation, Eli Lilly and Company, Massachusetts General Hospital, NewYork–Presbyterian Hospital, Cleveland Clinic, Cedars–Sinai, University Hospitals (Cleveland), University of Pittsburgh Medical Center, Mount Sinai Health System, Orlando Health, Northwell Health, and Mayo Clinic. Funds do not include university‑wide venture capital funds. Included are only funds making venture capital investments (exchanging money for equity in companies). The cumulative deal size represents the total size of all investment deals in which academic medical center venture capital funds participated, not only investments from those particular funds. Data are from PitchBook.

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Venture Capital Investments by Medical Centers

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formance and a driver of attrac- tiveness to outside lenders and in- vestors.

Venture capital activity is part of an evolution of AMCs toward developing new revenue streams that supplement traditional sourc- es of income, such as patient care, research, education, and philan- thropy. This shift may introduce tension between long-standing ef- forts to advance the AMC mis- sion and new demands to become savvy investors in emerging, some- times risky, areas of the financial marketplace. Some AMC venture capital funds have started raising capital in ways that resemble strategies used by traditional ven- ture capital funds, such as receiv- ing infusions from external, for- profit sources.

Venture capital investing by AMCs is probably underreported. The 10 example AMC venture cap- ital funds represent a subset of to- tal investments. In addition, cer- tain deals may not be reported, or full transaction details may not be released. In public reports of deal sizes, the amount invested by each entity (e.g., an AMC venture capi- tal fund) is not consistently dis- closed.

As AMCs increasingly engage in venture capital investing, sever- al potential implications warrant consideration. First, policy scru- tiny of such investments by hospi- tals and health systems may differ from the scrutiny of private equity investments in these entities. Pri- vate equity firms have frequently sold or cut the assets of health

care facilities they own, for instance by sell-

ing hospital real estate or reducing nursing home staffing, to gener- ate predictable returns. Such busi- ness decisions carry potential risks

for resources that clinicians need to deliver care and for the quality of care that patients receive, which has worried policymakers.

In contrast, venture capital funds, which typically don’t sell the assets of startup businesses, generally aim for outsized returns from a few investments to offset inevitable losses from others. Ven- ture capital investing is therefore often financially riskier than pri- vate equity investing, since most new ideas or startups don’t end up as successful businesses. It is probably less likely, however, to lead AMCs to cut costs or liqui- date their assets — moves that might directly harm patients and clinicians. In turn, policymakers may be less concerned about AMCs acting as venture capitalists than they have been about private equity ownership of health care entities.

Second, with federal funding streams becoming less certain, AMCs may see the pursuit of ven- ture capital investments as increas- ingly necessary. Beyond changes in the federal funding landscape, continued increases in staffing and administrative costs; low Medicare and Medicaid fees, as compared with commercial prices; competi- tion with peer institutions; and other fiscal challenges may further motivate health systems to move in this direction. Moreover, using venture capital investments to build financial reserves may be a strate- gy for improving hospital credit ratings, which could allow more hospitals to gain access to munici- pal bond markets.3

On the other hand, venture cap- ital investments by AMCs could strengthen the perception that such systems are operating as non- profits in name only.4 Nonprofit status facilitates large tax savings for AMCs, yet for-profit venture

capital funds can be housed with- in these nonprofit entities. Such arrangements are possible in part because of relaxed federal criteria for tax-exempt status. In the 1950s, the Internal Revenue Service (IRS) began requiring nonprofit hos- pitals to provide charity care to qualify for tax-exempt status. This policy evolved to require only the delivery of services defined as com- munity benefits and, subsequently, the performance of a Community Health Needs Assessment.5 More recently, the IRS has, on a case-by- case basis, allowed many nonprofit hospitals to own for-profit sub- sidiaries without losing their tax- exempt status. What venture capital profits mean for tax exposure may be an emerging policy question.

The contrast between mission and necessity, particularly in the current funding environment, could present an uncomfortable tension for clinicians, trainees, and poli- cymakers. AMCs have increasingly become diversified corporate enti- ties, with venture capital investing representing one type of corporate activity. Yet these entities remain the central place for medical edu- cation, research, and charity care, which could be supported by ven- ture capital returns. How self-gov- ernance and policy will adjudicate this tension remains to be seen.

Disclosure forms provided by the authors are available at NEJM.org.

1 Department of Medicine, Massachusetts General Hospital, Boston; 2 Department of Health Care Policy, Harvard Medical School, Boston; 3 Center for Primary Care, Harvard Medical School, Boston.

This article was published on November 22, 2025, at NEJM.org.

1. Levine E, Malani R, Odden A, Schulz J. Ensuring the financial sustainability of aca- demic medical centers. McKinsey and Com- pany, April 4, 2024 (https://www . mckinsey . com/ industries/ healthcare/ our - insights/ ensuring - the - financial - sustainability - of - academic - medical - centers).

An audio interview with Nishant Uppal is available at NEJM.org

PERSPECTIVE

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Venture Capital Investments by Medical Centers

n engl j med 393;21 nejm.org November 27, 2025

2. Whaley CM, Demirkan S, Bai G. What’s behind losses at large nonprofit health sys- tems? Health Affairs Forefront, March 24, 2023 (https://www . healthaffairs . org/ content/ forefront/ s - behind - losses - large - nonprofit - health - systems). 3. Bruch JD, Roy V, Grogan CM. The financial-

ization of health in the United States. N Engl J Med 2024; 390: 178-82. 4. Rosenthal E. Why many nonprofit (wink, wink) hospitals are rolling in money. Wash- ington Post, July 22, 2024 (https://www . washingtonpost . com/ opinions/ 2024/ 07/ 22/ nonprofit - hospital - health - care - industry/ ).

5. Rosenbaum S, Kindig DA, Bao J, Byrnes MK, O’Laughlin C. The value of the nonprofit hospital tax exemption was $24.6 billion in 2011. Health Aff (Millwood) 2015; 34: 1225-33.

A Wrinkled White Coat

A Wrinkled White Coat Mark A. Pacult, M.D.1

It was still early. Early enough in the morning that the smells of

midnight coffee still hung in the halls of the intensive care unit (ICU). And early enough in intern year that the windows still fogged against the 100-degree heat of Phoenix at 4 a.m.

I had learned the routine by now, even though it was only late July. Round on patients as effi- ciently as possible, stopping in be- fore families could muster from the pull-out couches, and make sure that no patient’s neurologic exam findings had worsened. Send the patients who’d under- gone spine surgery to the floor, keep those with subarachnoid hem- orrhages in the ICU until post-bleed day 14, and make sure the pres- sures from any external ventric- ular drains didn’t exceed 20 mm of water.

If anything deviated from the established plan, it was still the fact that it deviated, and not the actual situation, that caused panic. It was still early enough in my career that it surprised me, even shocked me somewhat, when things went wrong, when patients did poorly. When wrinkles ap- peared in the plans that I thought I was merely safeguarding, merely overseeing, not actively managing.

The patient with some short- ness of breath a few days out from

anterior cervical spine surgery simply couldn’t have a developing neck hematoma. It was impossible that the patient with back pain a few years after undergoing a tho- racolumbar fusion in the emer- gency department had fractured hardware. Just before the fatalism and everything-is-a-hematoma cat- astrophizing of later residency comes this equally reductionist and naive way of thinking that is driven by inexperience, inno- cence, and hopefulness. Cynicism and hopelessness arise from its eventual loss, which came for me on that early morning.

It was still early when the nurse called me back to the bedside of a patient with a ruptured cerebral arteriovenous malformation. Early enough that I hadn’t yet gotten to the end of the hall, hadn’t yet fin- ished rounding, and early enough that it was still dark outside. Too early for disaster, for death.

It was still early enough in in- tern year that I didn’t quite under- stand what it meant when the nurse told me that the patient had put out a copious volume of clear urine just then, or that the intra- cranial pressure was now remain- ing above 50 mm of water. This patient was supposed to be cool- ing down, stabilizing, kept mini- mally stimulated. The fact that his brain was now, as the nurse

kindly helped me to see, herniat- ing and causing an infarct in his pituitary gland was a wrinkle that I was neither expecting nor pre- pared to handle.

A nearby senior resident helped to stabilize the patient, but it soon became clear that no amount of heroics would save his life. His exam, which at presentation had already revealed only cough and gag reflexes, was now consistent with brain death.

The weight of the morning shifted. Our attention moved to orchestrating an apnea test — in- volving respiratory therapists and nurses, optimized ventilator set- tings and labs — so that we could meticulously and seriously prove and document what had shattered this patient’s life and my own med- ical innocence. And then we’d have to do what for me was still un- thinkable: tell a family their loved one was officially, certifiably dead.

It was still early in the after- noon when the brain death exam was complete. Early enough that the resident workroom was empty again after the morning rush. It was a Sunday, the hospital re- duced to a bare-bones staff. The blinding midday light filtered in, though inside it was cold, and I rummaged around for my white coat, which sat still folded and tagged at the bottom of a cabinet.

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