The Perils of Privatization
Make no mistake: The purpose of privatization is to make a profit. The promise of privatization is efficiency. But in its pursuit of both profits and efficiency, privatization creates perverse incentives. It encourages privately managed charter schools to avoid or get rid of "expensive" students" (unless the reimbursement formula makes them profitable to keep); it encourages for-profit hospitals to over diagnose patients and perform unnecessary surgeries; it encourages private preschool providers of special education to misdiagnose children as in need of services to produce profits.