Privatization and Public Hospitals

Choosing Wisely for New York City

Charles Brecher, Sheila Spiezio
Release Date: June 1, 1995

American politics in 1995 seems to have one overarching them: get government off the backs of people. In this environment, politicians of every political flavor are leading the charge against the very governments they serve. In New York City as elsewhere, the favored remedy is to privatize anything that can be sold or handed off to profit-seeking businesses.

In New York City and other major metropolitan centers, social services have been contracted out to non-governmental agencies. With this in mind and relative success, many agree that the idea of throwing more public services into a market environment should be explored. Moreover, markets do work best when entrepreneurs and investors can earn a profit.

In the following pages the authors consider the merits of privatizing one of the most expensive and most visible of public services in New York City: the public hospital system. The authors point out that, while still meeting the obligations of providing access for the poor, it is entirely possible that the number of facilities could be reduced, overall, if more efficient means of operating them were introduced. Though the authors are tough minded, they also believe that there are to many negative aspects in privatizing the public health system, mainly that in will not deliver quality goods at lowered prices.