From hospitals to nursing homes, the privatised care sector is on the rise in Europe. A slow process of privatisation and liberalisation, along with the ageing of the European population and the growing demand for elderly care, have opened up a new multi-billion euro market which is increasingly dominated by a handful of increasingly larger corporate groups.
It should come as no surprise that many of these new corporate giants that own and manage private hospitals, private nursing homes, or both, are French.
First, as has been the case in other economic sectors that have undergone a similar process of liberalisation and consolidation at European level (telecom, postal services, energy, rail etc.), the winners of the European single market are usually corporations based in Europe’s largest countries (France, Germany, Spain, Italy). They have a larger “home market” that gives them the financial firepower necessary to expand, enter new countries, acquire smaller competitors. This same pattern can be observed again in the care sector.
Second, this rise of the privatised care sector is in many ways a new episode in a longer and larger history, that of the “French model of privatisation”. It is no accident that – as we shall see – some of the corporate groups now active in the privatised care sector and their executives were associated, early in their career, with the ancestors of Veolia and Suez, the champions of privatised water and waste management. It is fundamentally the same business model: cashing in on the secure revenue stream that comes from running a service that addresses a fundamental need, and that is heavily subsidised, both directly and indirectly, by public authorities. In the privatised care sector, there are even additional benefits for potential corporate profiteers, such as the low level of regulation and the possibility to squeeze labour costs even further.
Many French privatised care corporations tend to tell their own history through the narratives of visionary entrepreneurs who knew, ahead of their time, that there would be a growing need for private healthcare and elderly care, and had the skills and the business acumen necessary to turn this vision into reality. Indeed, many of these corporate groups have been created or are still controlled by men who are now millionaires. But actually, their history is also one of being able to cash in on political connections – connections with decision-makers, but mostly et more crucially with high-level civil servants and government agencies.
One institution in particular is at…
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Auteur: Olivier Petitjean
