What Is a Private Hospital?

Mary McMahon

A private hospital funds operations through direct payments from patients and insurance providers, and does not receive public money. Such facilities can offer a variety of services to members of the public. The lack of reliance on government funds means that they are not required to meet specific targets set for public hospitals, which have a mandate to make care available to low-income patients and meet other requirements. These organizations are usually run as for-profit institutions.

In most cases, private hospitals are run as for-profit entities.
In most cases, private hospitals are run as for-profit entities.

At private facilities, virtually everything in the facility’s operations is funded through payments from patients and their insurance providers. These institutions do not receive grants from public agencies, although they may see patients who use public assistance to pay for treatment. Private hospitals may include services like pharmacies, physical therapy centers, diagnostic imaging centers, and other allied medical services. These can increase the services available for patients and generate more income for the facility.

Private hospitals may develop outreach programs to help people in the community, such as expectant mothers.
Private hospitals may develop outreach programs to help people in the community, such as expectant mothers.

Some are for-profit institutions and may be publicly traded, with an elected board and shares available on the open market. They can also operate as part of an allied group of health centers. This allows patients to receive care through a network when they travel, or to visit facilities with different services when their home hospitals do not meet their specific needs. At a private hospital, people have access to the same kinds of treatments they can get at a public facility, and sometimes may be able to get services not widely available to the general public.

Private hospitals do not receive government money.
Private hospitals do not receive government money.

Public hospitals usually need to meet public service mandates. The government provides financial assistance to ensure that health care will be provided to as much of the population as possible, and may require them to meet staffing targets, perform outreach to low-income individuals, and engage in other activities like public education. A private hospital does not have these regulatory burdens because it is run as a private enterprise. It needs to meet health and safety standards as a health care provider, but isn’t obliged to make services readily available to the public.

Though there is no specific public mandate at a private hospital, some can and do engage in public outreach for public relations purposes. This can include activities like donating services to low-income children or providing community education to reduce the rates of preventable diseases. A private hospital may also engage in research and could train doctors, nurses, and other medical professionals.

Private hospitals offer at least the same number of services as public hospitals.
Private hospitals offer at least the same number of services as public hospitals.

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Discussion Comments


@AnswerMan- I had a similar experience with a private hospital. I brought my wife into the emergency room because she was complaining of chest pains, and the triage nurse directed me to their billing department while they examined her. Once the clerk got all of my insurance information, she told me that this was a private hospital and I was going to have to take my wife to a public county hospital for further treatments. I thought it was unfair at the time, and I got pretty angry.

As it turned out, my wife got very good treatment for her angina at the public hospital, and we avoided getting a very large medical bill from that private hospital. The clerk actually did me a favor, and I went back and apologized for not understanding that at the time. Private hospitals are great places, but people need to know that they are not mandated to treat everyone, regardless of the ability to pay.


People might not realize how important it is to know if a hospital is considered public or private. When my son had an accident on a school field trip, the ambulance transported him to the closest hospital to the accident scene. It turned out to be a private hospital, and they could only stabilize him in their emergency room before having him flown to a public hospital in another city. My health insurance would not have covered all the costs if he had been admitted to a private hospital.

Personally, I think the private hospitals in my area provide better service than the public hospitals, but it's a matter of insurance coverage. I had a minor outpatient procedure done at a private hospital and everything was covered by my company's insurance. My son's injuries were much more serious, and the private hospital would have had to charge thousands of dollars for the same surgical procedures that were subsidized at the public hospital.

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