Commercialization represents the growing influence of market-oriented principles and profit motives within healthcare systems traditionally guided by humanistic values. This shift manifests in various contexts across the healthcare ecosystem, from pharmaceutical pricing to hospital management.
Healthcare was once primarily guided by the Hippocratic oath and a commitment to patient welfare above all else. Today, however, a transformation is reshaping medical practice across the globe. The increasing commercialization of healthcare—the application of market principles and profit motives to medical services—is altering the practice of medicine in ways both subtle and profound.
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The integration of profit motives into healthcare delivery has fundamentally altered decision-making processes. When financial considerations become paramount, clinical decisions may be influenced by revenue potential rather than purely medical necessity. In the United States, the fee-for-service payment model has been criticized for incentivizing overtreatment and unnecessary procedures, with some studies suggesting that up to 30% of healthcare spending may be wasteful or unnecessary.
The pharmaceutical industry provides an example of commercialization's impact, with insulin being perhaps the most emblematic case. In the 1920s, insulin's three discoverers sold the patent to the University of Toronto for $1 each, because co-inventor Frederick Banting said insulin "belongs to the world." However, as reported by Time magazine, the opposite has become true in the United States, where the price of insulin has risen dramatically: the average price nearly tripled between 2002 and 2013, according to the American Diabetes Association.
A 2021 Senate Finance Committee report examined the list price of insulin products by three major manufacturers and found that one commonly used insulin had increased by $101 from just five years earlier, while another saw a $159 increase during the same period. These price increases have devastating consequences—a 2019 Yale University study found that 25% of insulin users have rationed or skipped doses because of costs, facing impossible choices between paying for rent, food, or life-saving medication.
The reasons for these increases are complex and illustrate the dysfunctional aspects of profit-driven healthcare. Notably, the cost to manufacture insulin has not increased over the years—in fact, the average net cost of the most commonly used insulins is 20% lower today than in 2007, according to a study commissioned by the Pharmaceutical Research and Manufacturers of America (PhRMA). Yet prices to consumers continue to rise.
Professor Amitabh Chandra of Harvard points to several factors driving this disconnect: "evergreening" (where manufacturers slightly change formulations or delivery methods to extend patents), demand for the latest formulations, and middlemen like pharmacy benefit managers who "have a strong incentive to negotiate really aggressive rebates with insulin manufacturers" but "don't share them with the payers." The result is a system where profits are prioritized over patient access to essential medications.
As noted in Globalization and risks to health, "WTO's agreement on Trade Related Aspects of Intellectual Property Rights] threatens to limit and undermine access to new medicines, especially to poor populations living in the developing world." The article further emphasizes that "if patent protection leads to prohibitively priced drugs, it undermines access to new medicines among the most vulnerable populations."
The involvement of private equity firms in healthcare has increased in recent years, particularly in hospital acquisitions and specialty practices. The Financial Times case study of Ottumwa Regional Health Center in Iowa provides an example of how private equity ownership can create tensions between profit motives and patient care.
When Warburg Pincus acquired Ottumwa in 2010, followed by Apollo Global Management in 2015, the hospital became entangled in financial structures designed to extract value. According to a 2025 bipartisan Senate report titled "Profits Over Patients," Apollo loaded the hospital with debt through sale-leaseback arrangements and management fees that strained the facility's finances. By 2023, the hospital was operating at a $9 million loss while Apollo's investment funds realized substantial gains.
The consequences for patient care were:
More broadly, a 2023 study published in the Journal of the American Medical Association found that hospitals acquired by private equity groups saw a 25% rise in in-hospital complications such as falls and infections.
The Guardian's 2025 investigation into Advocate Health—one of America's largest hospital chains—reveals the human consequences when patients are treated primarily as consumers with financial obligations rather than individuals in need of care.
Despite Advocate Health's public positioning as "a leader in the effort to solve the nation's medical debt crisis," many patients reported devastating experiences with the hospital chain's billing and collection practices. These practices included:
One patient, John Ashley, described how medical debt from Advocate Health "financially destroyed us" after he sought emergency care for tunnel vision and high blood pressure. When the hospital sued him and his wife in 2013 for $5,771, he felt "like I was drowning and they were throwing me buckets of water." The hospital placed a lien on his home, offering only to "lower the bill slightly" if he didn't fight it.
The consequences extended beyond finances. Ashley later delayed seeking care for severe back pain due to fear of additional medical debt. By the time he finally saw a doctor, medical imaging revealed that two vertebrae in his lower back had "splintered off." As he described it, the pain "broke me as a man because it was so relentless."
This transformation of the patient-provider relationship from one of care to one of commercial transaction alters medical practice. It introduces financial barriers between patients and necessary care, takeaway trust, and creates incentives that prioritize billable services over optimal health outcomes.
Medicine has historically been considered a profession rather than merely an occupation—characterized by specialized knowledge, self-regulation, and a fiduciary responsibility to prioritize patient welfare above self-interest. Commercial pressures threaten this professional identity when physicians become employees of profit-driven corporations with competing loyalties.
Physicians increasingly report conflicts between their professional judgment and organizational imperatives focused on productivity and profitability. When performance evaluations and compensation are tied to metrics like relative value units (RVUs) or patient satisfaction scores rather than clinical outcomes, professional autonomy diminishes.
The implications of this shift are reflected in physician attitudes toward their work. A national survey, published in 2018, revealed that only 14% of physicians felt they had sufficient time to provide the highest levels of care. Additionally, 49% reported feelings of burnout, and 49% would not recommend medicine as a profession to their children.
Dr. Pamela Hartzband and Dr. Jerome Groopman, authors of "Your Medical Mind," describe how the business mentality in healthcare has led to the "industrialization of medicine," where physicians are treated as "providers" and patients as "consumers." They argue that this framework undermines the moral core of medicine and reduces complex healing relationships to mere economic transactions.
The pressure to maximize efficiency can compromise quality when patient encounters are shortened, unnecessary but profitable procedures are performed, or costly but necessary interventions are avoided.
Defensive medicine—ordering tests or treatments primarily to avoid litigation rather than benefit patients—further illustrates how commercial considerations distort clinical decision-making. This practice costs the U.S. healthcare system between $650 billion and $850 billion annually while exposing patients to unnecessary risks from overtreatment.
Similarly, pharmaceutical marketing practices can influence prescribing behaviors in ways that prioritize newer, more expensive medications over equally effective but less profitable alternatives. A 2016 study in JAMA Internal Medicine found that physicians who received payments from pharmaceutical companies prescribed brand-name medications at rates higher than their peers, even when generic alternatives were available.
When profit maximization drives healthcare delivery, services concentrate where they generate the greatest returns rather than where need is greatest. This market logic explains why wealthy urban areas often have oversupplies of specialists while rural and low-income communities face provider shortages.
In Texas, rural communities face healthcare disparities due to provider shortages, limited infrastructure, and high uninsured rates. Approximately 1 in 5 counties lack a primary care provider, leading to higher rates of chronic illness and mortality. Similar patterns emerge across the country, according to the Center for Healthcare Quality and Payment Reform, between January 2005 and 2023, 146 rural hospitals in the U.S. either closed completely or were converted to non-acute care facilities. Of these, 81 hospitals shut down entirely, while the remaining 65 ceased inpatient services but continued offering other healthcare services such as outpatient or emergency care.
The commercial imperative to maximize returns on investment means that healthcare facilities and services gravitate toward affluent areas where insurance coverage is comprehensive and out-of-pocket payment capacity is high. This creates a two-tiered system where access and quality correlate with wealth rather than need.
While commercialization poses threats to medical practice, an outright rejection of market principles is neither feasible nor desirable. The challenge lies in harnessing potential benefits while implementing safeguards against adverse effects.
Regulatory oversight can help ensure that commercial interests do not override patient welfare. This includes:
Regulatory approaches must be carefully calibrated—excessive regulation risks stifling innovation, while insufficient oversight leaves patients vulnerable to exploitation.
Alternative payment models that reward health outcomes rather than service volume offer approaches to aligning financial incentives with patient welfare. Value-based care arrangements, accountable care organizations, and global budget models attempt to reward quality and efficiency rather than quantity of services.
For instance, Centers for Medicare & Medicaid Services (CMS) has various value-based payment models, including the Medicare Shared Savings Program and bundled payment initiatives.
Safeguarding professional values requires both individual and systemic approaches:
When physicians maintain a professional identity anchored in patient welfare, they can serve as effective counterweights to excessive commercialization.
It can shift educational priorities toward profitability and marketable skills over patient-centered care.
Yes, even non-profit hospitals often operate under financial pressures that can influence care decisions.
They can introduce cost-cutting measures that may compromise patient outcomes and staff satisfaction.
Generally, yes, due to profit margins, administrative overhead, and market-driven pricing.
PBMs negotiate drug prices and rebates, often adding complexity and costs to the system.