Wall Street Payouts Threaten Our Health — Here’s How
By: Meron Lemmi
Healthcare has become a nightmare: rising costs, denied care, and mounting patient debt, all while Wall Street rakes in massive profits. On February 24, 2025, Americans for Financial Reform Education Fund (AFREF) and the Health and Political Economy Project (HPEP) hosted a webinar featuring physician and researcher Dr. Victor Roy, economist Lenore Palladino, and longtime physician and healthcare policy expert Dr. Donald Berwick. The conversation explored how corporate greed and financial engineering are siphoning trillions of dollars from our healthcare system and what we can do to stop it.
Financialization is Draining Healthcare Resources
Financialization in the context of healthcare, as Dr. Victor Roy explained, is when corporate actors prioritize the interests of financial markets over patients — for example, overspending on shareholder payouts instead of investing in higher quality patient care, worker pay, and innovation.
In a recently-published research paper, he found that 92 S&P 500 healthcare companies paid $2.6 trillion to shareholders between 2001 and 2022 — 95 percent of their profits. Sixty percent of these shareholder payouts came from stock buybacks — when companies artificially raise their stock prices by buying their own shares, a practice once largely considered illegal market manipulation. This isn’t just about a few greedy CEOs; it’s about how the system is designed to extract value. Public money and healthcare premiums are diverted away from care into shareholder pockets.
The Shareholder Myth Is Deepening Inequality
Lenore Palladino challenged some commonly held, dangerously misleading myths, such as that we are all shareholders and that share-trading fuels innovation. In reality, stock ownership is deeply unequal. Palladino cited Federal Reserve data showing that the wealthiest 1 percent of the population owns 50 percent of all corporate equities and mutual fund shares. The bottom 50 percent, half the country, owns just 1 percent. Racial disparities are even starker. While white households hold nearly 89 percent of all stocks, Black and Latine families hold under 0.7 percent and 0.6 percent, respectively. Additionally, stock trading doesn’t fund innovation; it just moves money around between investors instead of directing it to companies.
It’s in part because of these myths that corporations like major healthcare companies can extract value and widen racial and economic inequality. Palladino explains how Black and Latine families often get shut out of these gains yet are deeply impacted by the ensuing underfunded care.
It’s Not Abstract — It’s People’s Lives
Dr. Donald Berwick, a former administrator of Medicare and Medicaid, described the real-world harms of what he rightfully described as the “financial takeover” of healthcare. He explained that over 100 million Americans are in medical debt, and that the most significant cause of bankruptcy in the U.S. is medical debt. This is all while hospitals are consolidating and private equity firms are trying to maximize short-term profits by cutting corners. Dr. Berwick gave the example of UnitedHealth apparently overdiagnosing patients to extract higher payments from Medicare at the patients’ expense. “We’ve created a monstrously complex healthcare delivery system,” Dr. Berwick said, “and an even more complex financial system — one that’s no longer designed to meet the needs of patients.”
Dr. Roy offered another example in DaVita, a dialysis company primarily funded by public dollars. The company paid out over $10 billion in buybacks, which is more than its reported profits — all while underinvesting in patient care, dialysis innovation, and worker pay.
Reclaiming Healthcare from Wall Street
This isn’t inevitable; it comes as a result of policy choices. And these choices can be changed. Healthcare should serve the people, not only shareholders. Panelists called for stronger guardrails, including taxing or outright banning buybacks, and putting conditions on how public money can be spent. They also called for rethinking corporate governance to stop rewarding financial engineering.
As it stands, financialization is hurting our health. It’s time to rein in Wall Street’s grasp on our healthcare system and build one that actually serves people.