By Dr Arun Mitra
The remarkable advances in evidence-based modern medicine have made life easier, reduced mortality and increased longevity. To ensure that these benefits reach all citizens, it is imperative that the State takes responsibility for providing healthcare to everyone. From the immediate post-Independence period until the early 1980s, the State was the primary provider of healthcare, although small-scale private practice, single-person clinics and charitable hospitals also played an important role. In the early 1980s, however, economic policy shifted from social welfare towards a market-oriented economy. This also transformed the approach to healthcare.
The first major entry of corporates into healthcare occurred in the 1980s, when Apollo Hospital was established in Chennai in 1983, followed by Hyderabad in 1986 and Delhi in 1996. The process accelerated after 2014 when the BJP government came to power. Private Equity and Venture Capital (PEVC) investments in the health sector increased significantly. During the last decade, we have witnessed the rapid expansion of corporate hospital chains. Healthcare, once primarily considered a State responsibility and a major public welfare concern, has increasingly become a matter of profit. Thus, the patient-centric approach based on service, assurance and empathy is gradually giving way to a model in which revenue generation and profit have become priorities.
Since the 1990s, the number of corporate hospitals has grown rapidly. The presence of global financial actors in the corporatization and financialization of healthcare has also increased. Government agencies have encouraged this transformation by highlighting the enormous opportunities for private investors and reporting that the hospital sector is attracting global and domestic investment and India is becoming a hub for medical tourism.
With this transformation, the market has increasingly become the controlling force. Hospitals have started floating shares, something unheard of earlier. This process has excluded a large section of the population from advanced healthcare. Only the more affluent sections of society can afford these five-star hospitals. At the same time, the public healthcare system has become overburdened and unable to match the financial resources and infrastructure of corporate hospitals.
All that glitters is not gold. With their five-star buildings and sophisticated facilities, these hospitals remain beyond the reach of the vast majority of Indians. The work culture in these hospitals is also fundamentally different. From being clinician-driven institutions, they have increasingly become business-driven enterprises. Doctors are expected to generate revenue for the hospital. In regular review meetings, the agenda often becomes revenue-centric rather than patient-centric.
These hospitals generate profits by charging patients heavily as well as by raising money through the sale of shares. At the same time, there is pressure to reduce the wages of employees, particularly lower-income staff such as nurses, ward staff and laboratory workers. These hospitals are now owned by corporations whose owners are shareholders, with no single person bearing direct responsibility. Ownership can be transferred or changed as investments and are based on equity shares and capital. The entire system thus becomes centred on revenue generation by every possible means. It is also an irony that many of these hospitals do not adequately reinvest their profits in strengthening healthcare delivery, but instead invest in speculative financial markets. As part of business promotion, these hospitals often organise educational meetings in five-star settings, sometimes compromising the ethical standards expected of healthcare institutions. In many corporate hospitals, patients are also discouraged or prohibited from purchasing cheaper medicines from outside pharmacies.
While government health infrastructure serves rural areas through Primary Health Centres (PHCs) and Community Health Centres (CHCs), nearly 65% to 69% of all hospital beds, public and private, are concentrated in urban metros and Tier-1 cities. A comparison of hospital beds and infrastructure shows that the public sector has approximately 714,000 to 819,000 beds, compared with 1.18 million to 1.4 million in the private sector. According to National Statistical Office data, the average cost of hospitalization in a private hospital is roughly ₹50,508, compared with just ₹6,631 in a government hospital.
The creation of a profitable healthcare market for investors is facilitated by a weak public sector and by allowing the market to operate through conditional access based on the ability to pay. In other words, healthcare becomes accessible to those who can afford it and inaccessible to those who cannot.
PEVC investments in the healthcare industry as a percentage of all PEVC investments in India have doubled, from an average of 5% during 2017–2019, the pre-Covid years, to almost 10% during 2020–2023.
Corporatization of healthcare has also limited the professional autonomy of doctors, who are increasingly expected to meet revenue-linked targets, including quotas for admissions, diagnostic tests and therapeutic procedures. This model is influencing small and medium-sized private and charitable hospitals as well. Many are taking loans, hiring specialist consultants and investing in costly medical equipment to remain competitive. As a result, healthcare costs in these facilities have risen sharply, reducing access for economically disadvantaged patients and contributing to financial hardship for those seeking treatment.
Corporatization has also strained the doctor-patient relationship, contributing to a breakdown of trust and an increase in incidents of violence against doctors and hospital staff. The rapid expansion of private healthcare has been accompanied by chronic underinvestment in the public health system. Consequently, many patients turn to public facilities only when private treatment becomes unaffordable, reinforcing a two-tier system in which access and quality are increasingly determined by the ability to pay.
Parallel to the corporatization of healthcare in India has been the rapid privatization of medical education. Today, nearly half of all medical colleges in India are privately run, with students required to pay substantial fees. Many of these institutions lack adequate infrastructure, faculty and clinical exposure, affecting the quality of training. After graduation, students often pursue high-paying specializations or corporate-sector jobs to recover the considerable financial investment made in their education.
There is an urgent need for a public movement against this trend. Concerned and sensitized citizens must take responsibility for spreading this information among the people through various means. People are aware of their suffering but are often unable to find a way forward due to lack of information and organized public action. In this connection a symposium on ‘Corporatisation of Healthcare in India’ organized by the UNU Global Health and O.P. Jindal Global University on 25-26 September 2026 at New Delhi is a commendable job. Medical professionals and economists from across the country shared their ideas, experiences and research work to formulate the line of action for advocacy and networking so as to build a movement for health for all. (IPA Service)
