CHICAGO – Illinois has enacted a landmark piece of legislation aimed at increasing transparency and oversight of private equity and other investment firms that acquire group homes and other facilities serving individuals with intellectual and developmental disabilities. The move comes in the wake of a significant crisis involving Broadstep, a major provider whose license was ultimately revoked by the state due to a litany of documented violations, sparking a broader debate about the growing influence of financial corporations in the care sector.
The new law, which received broad bipartisan support and awaits Governor JB Pritzker’s signature, mandates that asset management companies purchasing facilities for people with disabilities report these acquisitions to the state. Subsequently, these entities will be required to regularly submit detailed financial information, including assets, liabilities, and staffing levels, to the Illinois Health Facilities and Services Review Board. Furthermore, the legislation introduces an "anti-looting" provision, requiring notification before the sale of business assets and certification that such a sale will not financially destabilize the facility. Failure to comply with these reporting requirements will result in fines and notification to the relevant state licensing agency.
This legislative action represents a direct response to the documented failures of Broadstep, a provider that served a substantial number of individuals across Illinois. A 2024 audit by the state Office of the Auditor General revealed a concerning pattern of non-compliance and regulatory breaches at Broadstep facilities. The audit detailed a nearly seven-page list of violations, including issues such as expired medications, incomplete background checks for employees, improper reporting of critical incidents that may have involved 911 calls, and staff members lacking essential qualifications like high school diplomas or GEDs.
The Broadstep Collapse: A Pattern of Neglect
Broadstep, which operated numerous community integrated living arrangements (CILAs), commonly known as group homes, for individuals with intellectual and developmental disabilities across the state, including locations in Freeport, Springfield, Marengo, and Naperville, came under intense scrutiny following investment by Bain Capital around 2020. According to reports from AFSCME Council 31, a prominent labor union, and the Private Equity Stakeholder Project, a watchdog organization, Broadstep’s operations deteriorated significantly after this investment.
At its peak, under Bain’s financial backing, Broadstep reportedly housed between 150 and 200 individuals across its facilities, each with a maximum capacity of eight residents. These homes had previously operated under the names Willowglen and Bethesda before being acquired. The state’s audit, covering the period from July 2020 to June 2023, concluded that Broadstep "appears to have violated both State law and State rule." During this period, Broadstep received approximately $23.6 million for its services, the highest funding amount among the 25 providers examined in the audit.
Despite these findings and repeated instances of non-cooperation with investigations, the Illinois Department of Human Services (IDHS) initially failed to impose significant sanctions on Broadstep. The audit specifically noted that the company "repeatedly refused to cooperate" with investigations into allegations against it. A spokesperson for IDHS, Summer Griffith, stated that the department is implementing the auditor’s recommendations and has strengthened its tracking, coordination, and follow-up procedures for non-compliant providers, clarifying policies for addressing such issues.
The formal notification to Broadstep regarding the revocation of its license occurred in 2024. This action followed the company’s persistent failure to rectify the documented violations, even after receiving multiple warnings and opportunities to implement corrective action plans. A revocation notice, obtained through a Freedom of Information Act request, indicated that despite efforts to assist Broadstep in addressing deficiencies and establishing compliance systems, "the deficiencies continue."
The Role of Private Equity and the Genesis of New Legislation
The Broadstep case has become a focal point in a larger discourse surrounding the increasing presence of private equity firms and other asset management companies in the disability services sector. A 2023 audit highlighted that in that year alone, Illinois’ licensed disability care system encompassed over 3,100 sites and served approximately 11,000 individuals with developmental disabilities. The financial interests of these investment firms, often driven by profit maximization, have raised concerns about the potential for compromising the quality of care and the financial stability of these vital facilities.
The legislation’s sponsors, State Senator Javier Cervantes and State Representative Laura Faver Dias, emphasized that the bill’s primary objective is to establish a framework for oversight and accountability, rather than to deter investment. "So I think these are more of ways to create guardrails," Senator Cervantes stated. "I think one facility dealing with this for me is enough, right? I think that’s one too many. I don’t have a problem with them coming in here and investing, but as long as they’re—they don’t do any looting, they don’t do things that will run down the facility."
Representative Faver Dias echoed these sentiments, noting that testimony from AFSCME Council 31 regarding conditions at Broadstep-owned homes heavily influenced the bill’s priorities. "Yes, there are business entities operating in this space, but… my top priority is the human care," she asserted. "We know that private equity has a vested interest in profit, and the state of Illinois—I think it’s pretty broad consensus that we have, our motive in this space, is making sure that our most vulnerable residents are taken care of in a way that they deserve."
Jacob Meeks, policy director for AFSCME Council 31, pointed out that existing state regulations did not adequately anticipate the extensive involvement of asset management companies and private equity firms in the disability services sector. "When the state’s regulations were developed, they didn’t contemplate asset management companies and private equity firms having an interest in disability services," Meeks explained, highlighting a significant regulatory gap that the new law seeks to address.
Unraveling Ownership and Bain Capital’s Involvement
The exact ownership structure of Broadstep, particularly in the period leading up to its license revocation, remained somewhat opaque, underscoring the need for mandated transparency. Neither Broadstep nor its legal representative responded to inquiries regarding the new legislation or the license revocation.
Bain Capital, through a spokesperson, stated that it had not been the "majority owner of Broadstep since October 2023" and therefore was not operationally involved when the license was revoked in 2024. However, this statement has been met with scrutiny. Archival records from Bain’s website indicated that Broadstep was listed as an "active" investment well into 2025. Bain Capital Double Impact, one of its investment arms, acknowledged retaining a "small residual equity position" after October 2023, suggesting a continued financial interest even after relinquishing majority operational control. Bain’s spokesperson maintained that the 2024 revocation occurred after their operational control had ended, declining to comment on violations predating October 2023.
This ambiguity surrounding ownership and operational control highlights the challenges regulators face when complex financial structures are involved, reinforcing the importance of the new transparency requirements.
Broader Implications and Industry Reactions
The extent of private equity ownership within Illinois’ group home provider landscape remains largely undetermined, a knowledge gap the new law is specifically designed to fill. A 2025 report from the Private Equity Stakeholder Project identified approximately six intellectual and developmental disability service providers with a presence in Illinois that are associated with private equity firms.
While some lawmakers, like Senator Cervantes, suggest that large-scale asset management firm involvement might be limited in Illinois’ current disability care system, the experience with Broadstep is viewed by advocacy groups as a critical national case study. Matt Parr, spokesperson for the Private Equity Stakeholder Project, commented, "Illinois was a very unfortunate case study in what was happening with these private equity-owned (intellectual and developmental disability) providers."
Josh Evans, President and CEO of the Illinois Association of Rehabilitation Facilities, an organization representing community-based providers, noted that the majority of organizations he works with are non-profit. While his association did not officially support or oppose the new bill, Evans questioned the overall scale of private equity ownership among the hundreds of licensed providers in Illinois. He emphasized that providers in the intellectual and developmental disabilities sector generally operate under stringent oversight, including audits and reporting to state government, and that the focus for many organizations remains on issues such as wages.
A Direct Support Professional’s Account
The human impact of the alleged operational failures at Broadstep was powerfully illustrated by the account of Rori Schrader, a former direct support professional at the Freeport-area homes, then known as Willowglen. Schrader began her tenure in 2013, providing essential daily care, including medication administration, bathing, and feeding. She described a noticeable decline in care quality and an increase in staff turnover after Bain Capital’s investment around 2020, leading to unmanageable patient-to-staff ratios.
"You could just tell that once we were bought by this company, that there wasn’t as much care for the individuals or the staff," Schrader recounted. She also observed deteriorating facility maintenance, with issues like unrepaired holes in walls persisting for extended periods. The reduction in administrative staff and the difficulty in reaching management further compounded the challenges. The closure of the facility last year left Schrader concerned about the adjustment process for long-term residents transitioning to new placements.
Stacey Aschemann, vice president at Equip for Equality, an organization advocating for individuals with disabilities, views the new legislation as a significant step towards greater transparency. "Service models that focus on maximizing profits must not be part of Illinois’ support system for people with developmental disabilities," Aschemann stated, underscoring the belief that the well-being of vulnerable individuals should not be compromised by profit-driven motives. The new law aims to ensure that the financial interests of investment firms are balanced against the critical need for safe, stable, and high-quality care for Illinois’ most vulnerable citizens.
