Study Reveals Risks of Hospital Privatization on Patient Care Quality

A comprehensive review led by researchers from the University of Oxford has shed light on the impacts of hospital privatization, revealing that such transitions often result in poorer quality care compared to publicly owned hospitals. Published in The Lancet Public Health, the study challenges the notion that privatization improves healthcare quality, highlighting the potential trade-off between reduced costs and compromised patient care. 

Dr. Benjamin Goodair, the lead author of the study and a postdoctoral researcher at the Department of Social Policy and Intervention at the University of Oxford, emphasized the significance of their findings. He stated, “This review challenges the justifications for health care privatization and concludes that the scientific support for health care privatization is weak. Overall, hospital privatization may reduce costs, but does so at the expense of quality of care.” 

The research team conducted a meta-analysis, synthesizing evidence from 13 longitudinal studies across several high-income countries. These studies examined healthcare quality measures before and after the privatization of health services, at either the hospital or regional level. Quality indicators assessed included staffing levels, patient insurance mix, service provision, physician workload, and patient health outcomes, such as avoidable hospitalizations. 

The results revealed a consistent trend increases in privatization were associated with deteriorating quality of care, with no studies showing unequivocally positive effects on health outcomes. Furthermore, hospitals transitioning from public to private ownership tended to prioritize profitability, often achieved through staff reductions, and catering to patients with more comprehensive health insurance coverage. 

The consequences of privatization extended beyond staffing and insurance coverage. The review found that privatization was linked to reductions in cleaning staff per patient, resulting in higher rates of patient infections. Moreover, in some instances, higher levels of hospital privatization were associated with increased rates of avoidable deaths. However, there were exceptions, such as in Croatia, where privatization led to improvements in patient access through enhanced appointment precision and innovative care delivery methods, including out-of-hours telephone support. 

These findings challenge the prevailing notion that privatization fosters competition and flexibility, enhancing healthcare quality. Instead, the research suggests that outsourcing services to the private sector may compromise patient-centered care and exacerbate disparities in healthcare access and outcomes. 

Professor Aaron Reeves, a co-author of the study from the Department of Social Policy and Intervention at the University of Oxford, underscored the importance of considering the long-term implications of healthcare privatization. He warned against viewing privatization as a panacea for healthcare system challenges, particularly amid pressures from aging populations, constrained budgets, and the aftermath of the COVID-19 pandemic. Reeves cautioned that prioritizing short-term cost reductions through privatization could undermine long-term healthcare outcomes, as the private sector may not consistently deliver better or more affordable care. 

Moving forward, the researchers advocate for further investigation into the effects of privatization on other aspects of healthcare delivery, including community, primary, and ambulance services. By expanding the scope of research, policymakers can make more informed decisions regarding healthcare privatization, ensuring that any changes prioritize patient welfare and long-term sustainability. 

The countries included in the analysis encompassed a diverse range of healthcare systems, including Canada, Croatia, England, Germany, Italy, South Korea, Sweden, and the United States. This diversity underscores the global relevance of the study’s findings, highlighting familiar challenges and considerations associated with healthcare privatization across different contexts. 

Journal Reference  

The effect of health-care privatization on the quality of care, The Lancet Public Health (2024). DOI: 10.1016/S2468-2667(24)00003-3.