By Zoe Hughes
Chronic underfunding, weak implementation, and persistent governance challenges in Nigeria’s public health system are the core concerns that have led to the dominance of the private sector. It is estimated that up to 70% of healthcare services in Nigeria are delivered by the private sector. However, the extent to which private-sector-led service delivery supports the goals of Universal Health Coverage (UHC)—particularly in ensuring affordable and quality care—remains contested. This concern largely stems from the sector’s inherently profit-driven orientation. In this blog, I discuss the tension between private health providers making profits and, at the same time, providing care consistent with the goals of UHC.
The tension between profit and Universal Health Coverage
UHC means everyone has access to quality health services without facing financial hardship. Traditionally, the public sector has been seen as the main provider, with the private sector playing a supporting role to be engaged by the government. However, in countries with private-led healthcare systems, this view does not fully align. This is because the profit-driven nature of private healthcare can conflict with UHC goals, leading to overtreatment, inflated prices, compromised quality, and the selective treatment of the most profitable patients and services. Typically, for-profit healthcare is only accessible to those who can afford it, which may also lead to catastrophic out-of-pocket health expenditures.
The context of US healthcare capitalism is not a great reference for Nigeria
Criticisms of private healthcare often focus on its strong profit motive. However, the private healthcare sector works differently in each country, shaped not only by market forces but also by local culture and economic conditions. In the U.S., private-sector involvement has driven significant medical innovation but has also contributed to the country having the most expensive healthcare system in the world.
The US healthcare market is estimated to be worth $5 trillion. In comparison, Nigeria’s healthcare market is about $18 billion, just 0.36% of the US market. In Nigeria, profitability in healthcare is more limited than in high-income countries due to low demand, driven by widespread poverty and a heavy reliance on out-of-pocket payments because health insurance coverage is low. Nigerian firms also operate in challenging conditions, including limited state capacity, poor infrastructure, and constrained access to capital.
Africapitalism: Balancing profit motives with public good
Nigeria’s health sector has deep, persistent problems. This is a reality that every healthcare actor in Nigeria knows, and many experience firsthand. In Nigeria, many private healthcare facility owners are motivated by a deeply personal desire to expand access to high-quality medical care, with the goal of reducing outbound medical tourism and restoring trust in the country’s healthcare system.
Amidst the backdrop of the ‘japa’ of Nigerian health professionals, some healthcare entrepreneurs have chosen to stay in Nigeria or return after training or practicing abroad, motivated by a commitment to delivering care locally and a belief that “the Nigerian patient is worth it.” Their drive to transform Nigeria’s health sector is well captured by the concept of Africapitalism, an economic philosophy that argues Africa’s private sector should lead development through long-term, profit-oriented investments that also create social wealth and prosperity. However, it remains unclear whether these healthcare entrepreneurs are primarily interested in capturing their share of the healthcare market, which is dominated by out-of-pocket spending, or in enhancing health outcomes.
In Nigeria, many private healthcare facilities run foundations that subsidise or fully cover the cost of care, and many providers also treat patients who cannot afford to pay. These practices are rarely captured in academic evaluations of private healthcare, which often overlook the cultural, moral and economic contexts that shape how the private sector operates. There is limited empirical data on how common these practices are and their impact on equity, highlighting the need for more systematic research.
Looking inward: The boundaries and prospects for the private health sector in Nigeria in realising UHC
We should assess the private healthcare sector’s potential to advance UHC in Nigeria by considering local realities and focusing on how to maximise its benefits while recognising its limitations. Private healthcare also contributes significantly to Nigeria’s economic development.
For example, earlier this year, a private clinic in Lagos performed West Africa’s first robotic ovarian surgery. The patient received the procedure free of charge as part of the clinic’s corporate social responsibility. By expanding the range of medical services available in Nigeria, the private sector is helping to build new domestic markets, keep healthcare spending within the country, and increase national revenue.
One of the most evident clashes between private healthcare and UHC lies in its reliance on the ability to pay and the consequences this has for equity. Nigerian healthcare providers recognise this tension, and many have responded through benevolent financing schemes previously discussed. However, corporate social responsibility cannot replace the role of the public sector in achieving UHC.
The balance between the private sector’s pursuit of profits and consideration for public-spiritedness is acknowledged by the Healthcare Federation of Nigeria (HFN). It is a non-profit, non-governmental coalition of private-sector stakeholders working to improve healthcare delivery in Nigeria. Encouragingly, HFN has expressed support for expanding health insurance coverage under the National Health Insurance Authority (NHIA) framework. It advocates a coordinated approach that combines private-sector insurance delivery with public-sector oversight and targeted subsidies for low-income households.
Proposed measures include focused outreach to rural populations, informal workers, and low-income groups; the administration of premiums in ways that recognise the poor and vulnerable; and cross-subsidisation to improve affordability. These efforts would be supported by government funding through the Basic Health Care Provision Fund (BHCPF). Together, these reforms show strong potential to make Nigeria’s progress toward UHC more inclusive, but their impact must be backed by data to ensure that no one is left behind.
Looking forward: Aligning private healthcare with public goals
Nigeria’s private healthcare sector is shaped by actors who, guided by a strong sense of purpose, balance the need to stay financially viable with a moral commitment to delivering care. As the healthcare market grows and changing financial incentives attract more private-sector involvement, the challenge will be to design and enforce regulations that reflect the value of public-spiritedness, while also building robust data systems to monitor and evaluate private-sector activities.
Many private-sector actors have expressed a commitment to UHC, but their efforts need to be guided by data and assessed by results. The government should support these efforts by investing in local research capacity and enforcing regulatory standards that align private sector activities with national UHC goals. Furthermore, many unregulated private healthcare providers operate in the informal sector, particularly those serving the poor and vulnerable populations. It is crucial to prioritise strategies that effectively govern these providers and integrate them into the formal health system.
Author’s Bio
Zoe Hughes is a British-Nigerian medical student at Stanford University and a visiting researcher with the Health Policy Research Group at the University of Nigeria, Enugu. Her research focuses on healthcare financing and health system development in Nigeria and Africa.
