Why IFC Invests in private healthcare
Summary: IFC’s investments in private healthcare services delivery reached 61.5 million patients across all regions of the world between 2021 and 2023. Financing healthcare through the private sector is an important step in helping countries reach their Universal Health Coverage goals. Public health sectors are strained and on their own cannot meet the growing demand. A strong private health sector adds capacity and provides the medical technologies and advanced services that strengthen access to quality care.
Achieving Universal Health Coverage will require scaled up action from both public and private health sectors — in terms of financing and service delivery. Access to quality healthcare is a basic need. In developing countries, too often this access is out of reach. Over half the world's population — 4.5 billion people — lack access to essential health services, a problem exacerbated by pandemics, shortages of medical supplies, the demands of aging populations, and stretched public health systems.
Governments have not been able to keep up. A strong private sector frees up public sector money to support the most vulnerable and expands capacity to meet growing demands. In 2023, average spending by governments of low-income countries was $8 per person, a fraction of the cost of basic care ($60-$86 per person). The reality is that governments cannot achieve Universal Health Coverage without the private sector bridging gaps by providing the medical technologies, innovations, and capacity that improve access and quality. The private sector already serves an important role in developing countries, providing 40 percent or more of health services in many places.
The World Bank Group is committed to helping countries deliver quality, affordable health services to 1.5 billion people by 2030. The World Bank Group’s strategy for Universal Health Coverage has public and private health sector components. On the public sector side, we work with governments to build stronger, more resilient health systems and provide quality, affordable health services to everyone – especially the most vulnerable. IFC complements that by focusing on strengthening private hospitals that can meet the growing demand from patients across a broad spectrum of income groups. In addition, by advising on public private partnerships and contracting of health services, we help Governments more effectively work with the private sector.
What is IFC’s role and why the urgency in helping strengthen the private health sector?
IFC has a dynamic investment strategy to support scaling up healthcare services. IFC invests in hospitals that are making a positive difference in people’s lives. Our clients together served 61.5 million patients between 2021 and 2023, providing critical advanced medical technologies that enable lifesaving care, helping fill gaps in available care, and sponsoring programs to help the communities around them.
The need could not be more urgent. Noncommunicable diseases such as cancer, diabetes, and cardiovascular disorders are on the rise globally and disproportionately impact the poor. About 73 percent of deaths from noncommunicable diseases — and 82 percent of premature deaths from these diseases — occur in low and middle income countries. One reason: developing countries are less likely to have the necessary diagnostics to detect and monitor these illnesses.
A survey of 10 countries across Africa, South Asia, and the Caribbean, found that median availability of basic diagnostic testing – from blood tests to ultrasound – was 19 percent in basic primary care clinics, 49 percent in even advanced primary care facilities, and 70 percent in hospitals. This means that a mother bringing her child to a clinic with a high fever, a wracking cough, or extreme listlessness may not be able to find out what is wrong with her baby, leaving the child at risk of getting sicker and even dying.
Similarly, about one in 20 women globally will develop breast cancer. In Europe, the five-year survival rate ranges from around 75 percent to more than 90 percent. In sub-Saharan Africa, about 50 percent of women with breast cancer are dead within five years. Why? Because screening, advanced imaging equipment, and proper treatment is limited. That disparity is unacceptable. In Africa, for example, where two-thirds of all Magnetic Resonance Imagining machines are in private facilities, support for private hospitals clearly is support for better care.
We have gone beyond our clients when it comes to improving access to the critical diagnostics that underlie timely and appropriate treatment. IFC’s Africa Medical Equipment Facility is a special program to help small and medium-sized clinics acquire new equipment from top manufacturers. Already facilities in Kenya and Cote D’Ivoire are benefitting, allowing them to better serve their patients.
Finally, no health system can function without health workers. Africa faces a projected shortage of 6.1 million healthcare workers by 2030, and Southeast Asia will need an additional 4.7 million health workers. Private hospitals help retain health workers and can provide training that can later benefit public facilities too. Our investments support close to 400,000 jobs and help keep health workers where they are needed most.
Building stronger health systems has a multiplier effect beyond the patients served. Oftentimes, people in developing countries are forced to travel abroad for specialized care, in particular cancer care. When private hospitals set up advanced oncology units, they make cancer care more accessible, they enable people to spend less for treatment, they create centers of excellence that the public sector can follow, and they help keep or bring back critical specialized healthcare professionals.
What does IFC do to safeguard against integrity problems?
We know that in all health care provision, there is the possibility that things will go wrong. IFC helps clients improve their operating systems, and we expect them to respond quickly and with integrity when problems arise.
IFC is constantly improving its appraisal and supervision processes for health services investment projects. We strive to identify and predict potential risks related to patient safety and protection before we invest. And we demand responsiveness and alignment on ethical principles of health care. IFC will not work with clients who do not commit to – and follow – our Environmental and Social Performance Standards. As of 2024, we also require new clients to commit to and follow specific ethical principles and practices for patient care.
In addition to investments, IFC provides advisory programs to help our clients and non-clients strengthen care. More than 220 private hospitals, mainly in North Africa and Sub-Saharan Africa, have worked with IFC to analyze and improve their quality-of-care standards, improving services for more than 1.7 million patients annually. The Ethical Principles in Healthcare (EPIHC) initiative, launched in 2019 by the World Bank and IFC, has 400 signatories that own or manage over 6,000 healthcare facilities in more than 100 countries. This voluntary association aims to help health facilities understand and implement ethical principles into their operations.
We believe that health systems are strongest when they reach patients across income levels. We see that public health systems benefit from a strong private health sector that meets accepted standards of care and operation. Together, through greater partnerships and complementarity, we can help elevate the standards and achieve Universal Health Coverage.
Last updated: March 2025