Patients detained, denied care at hospitals funded by World Bank

Billions of taxpayer dollars invested in for-profit facilities from Africa to Asia were supposed to improve access to healthcare. But stories of abuses have piled up

ANALYSIS | GAVIN FINCH, KENDALL TAGGART & DAVID KOCIENIEWSKI | The 1-year-old was with her pregnant mother at a maternity clinic when the convulsing started. A midwife tried giving her oxygen, but Miracle clearly needed emergency treatment. So they rushed her to the nearest hospital, a five-minute drive away.

Perched on a hill, behind fences topped with barbed wire, C-Care IHK in Kampala, Uganda, looks like a fortress. Miracle’s mother shuddered as she passed through the gates that September day and saw the landscaped garden and a billboard advertising plastic surgery. “When they see me, they know I don’t have money,” said Hasifa Mwamini, a refugee from the Democratic Republic of Congo. “The hospital is for high-class people.”

From the hospital’s second floor, she could see the metal roofs of her neighborhood. Her husband had constructed their mud house on a tiny plot of land alongside a railroad track and an open sewage channel that torments thousands of people in the informal settlement of Namuwongo with infections and other health risks.

Mwamini and the midwife approached the desk. They hardly needed to explain that Miracle’s situation was dire: Her body was spasming, her eyes rolling back into her head.

But the receptionist’s tone was stern, Mwamini recalled. “We’ll need to check on a few things,” she told her. When they tried to explain that a nonprofit organisation had agreed to cover Miracle’s medical bills, she told them to take a seat. The midwife ran to get a credit card from the group, leaving Miracle and her mother to wait.

As they sat in the hallway, doctors walked by without stopping. Five minutes passed. Then 10. Then 30. Miracle’s wheezing grew louder, and her body kept convulsing. “When will they attend to her?” Mwamini asked herself, afraid her daughter was going to suffocate.

Denying emergency medical care is illegal in Uganda. But while it has received millions of dollars in public funding to expand access to healthcare, C-Care IHK has turned away patients in emergencies because they didn’t have enough money, according to people with direct knowledge of the denials. A 29-year-old with Covid symptoms died after hospital staff told her brother they wouldn’t treat her without a deposit of several hundred dollars, members of her family said. A young man who’d been in a motorcycle crash lay outside the entrance for half an hour until staff were satisfied he could pay and sent a stretcher to take him in, the person who brought him to the hospital said.

C-Care funded

C-Care IHK is one of dozens of private healthcare companies in lower-income countries that have received more than $9 billion over the past 25 years from the International Finance Corp., the arm of the World Bank that invests in for-profit businesses. The IFC’s goal is to leverage taxpayer funds from governments around the world to lift millions out of poverty by investing in hospitals, infrastructure projects and other businesses.

But instead of helping those most in need, the IFC’s health initiative has exacerbated a two-tier system in which wealthier clients get first-class care in hospitals that sometimes resemble high-end hotels, while low-income patients face abusive debt-collection tactics or denial of life-saving care altogether, a Bloomberg News investigation has found.

The IFC declined to say how many hospital companies it currently funds. But Bloomberg identified more than 20, and at least four of them barred patients from leaving after their treatments ended until they could pay their bills — a practice illegal in many countries — according to accounts they or their families provided, hospital documents and interviews with former employees. Some hospitals denied emergency care to patients until they demonstrated an ability to pay.

One hospital in the Philippines, part of a company that received a $100 million IFC loan, cut off some medications to a patient who could not walk after he fell behind on payments and kept him there for six days until he settled a $12,000 bill, the man said. Some families said that corpses of relatives were held at IFC-backed hospitals until they could pull together sufficient funds.

The IFC said it has rigorous protocols for protecting patients. “We conduct an extensive due diligence process before making an investment in any client,” a spokesman said in an email. Yet he acknowledged that the bank didn’t look into whether hospitals in Uganda, the Philippines and elsewhere engaged in patient detentions before making investments, even though allegations about the practice at both public and private facilities have been widely reported in local media. It wasn’t part of the screening process, he said.

After Bloomberg asked how the hospitals dealt with Miracle and others, the fund said it would tighten its appraisal and supervision process to address concerns about coercive financial practices.

That change comes after years of warnings that the IFC wasn’t doing enough to guarantee that the hospitals it invested in were meeting the needs of the people it intended to serve or upholding patients’ rights. Even after concerns were raised by the United Nations High Commissioner for Human Rights, advocacy groups such as Oxfam and the bank’s own internal monitors, the IFC didn’t vet potential hospital deals for such practices.

“Oxfam has been raising the alarm about the IFC’s investments in private healthcare for well over a decade,” said Anna Marriott, health policy manager at the nongovernmental anti-poverty organization. “Their response, alongside the other development banks, has been inexcusably lackluster.” (The IFC said it had taken measures to address some of Oxfam’s issues and disagreed with others.)

Funding for C-Care IHK and other hospitals was supposed to be part of a global solution to the staggering healthcare needs of low-income countries. While the World Bank allocates funds to governments for public health projects, it determined two decades ago that it couldn’t solve the problem without the participation of business. So its investment arm began searching for opportunities to take equity stakes in or provide loans to for-profit providers.

The World Bank promises donor governments that it will invest only in viable businesses and use the returns to fund future initiatives. That means recipients are under pressure to repay loans, which more than 95% do, or provide financial returns. The IFC reported profit from all investments in the most recent fiscal year of $1.5 billion.

Bloomberg reporters spoke with more than 100 patients, lawyers, human rights advocates and former hospital employees in 12 countries across Africa, Asia, the Middle East and Latin America. They also reviewed medical records, internal company documents and government reports. In dozens of cases, they found patients with medical bills that pushed them into crushing debt, forcing some to put up property as collateral just to get out of the hospital.

In Miracle’s case, the emergency unfolded while a Bloomberg video producer was present. Azhar Sundhoo, chief executive officer of C-Care Uganda, which runs the hospital and more than 20 clinics, said staffers followed established protocols and that his company would never deny patients emergency care. He declined to answer additional questions about Miracle’s treatment. The hospital’s priority “first is to save life, but then once it’s stabilised is to make sure they can afford it,” Sundhoo said. “In an emergency situation, you obviously haven’t got time to screen.”

Profit becomes a central focus

The World Bank has said the IFC’s work will play a critical role in helping 1.5 billion people gain access to affordable, high-quality services over the next five years. There’s no doubt that many have benefited from these investments, particularly in countries where public health facilities lack resources and well-trained staff. But some poverty experts said there’s no evidence that funding for-profit providers helps those with the lowest incomes. And the IFC acknowledges that it doesn’t track such information.

“There are no impact studies undertaken, neither in advance nor afterward, to actually assess the effects on the poor in detail,” said Philip Alston, a former UN rapporteur on extreme poverty and now a law professor at New York University. “Privatization in health care does work well for the elite, and it works even better for the providers and governments. But it is a seriously losing proposition for most of the middle classes, and always for the poor.”

Over a steak dinner at Martin’s Tavern in Washington, the Georgetown pub where John F. Kennedy proposed to Jacqueline Bouvier, IFC executives Scott Featherston and Emmett Moriarty were discussing one of the world’s biggest development problems. Despite decades of work and billions of dollars of aid, sub-Saharan Africa continued to be ravaged by disease and stubbornly high infant mortality rates.

It was 2006, and the two men lamented that there simply wasn’t enough funding from governments and philanthropists to meet the enormous need. Sitting in the glow of the restaurant’s Tiffany-style lamps, they mulled a possible solution: Encourage investment in for-profit companies to fill the void.

They decided to hire a global consulting firm to analyse the business potential. To help foot the bill, they’d tap the Bill & Melinda Gates Foundation. “Gates agreed to pay for it,” recalled Featherston, who left the bank in 2015, four years after Moriarty. “But they wanted IFC to commit to taking action. So we got buy-in from the very top.”

A year later, the IFC published a report prepared by McKinsey & Co. that dangled the possibility of 30% profit margins for investors and called on governments to subsidise insurance to help pay for private care. But the study also included a stark warning. “While many private sector providers are honest and well-intentioned,” the report noted, “there are too many examples in which the pursuit of excessive profits leads to unethical business practices such as under- or over-servicing, collusion, false billing, price gouging and unlicensed practice.”

The IFC, which for half a century had been investing in bridges, highways and other infrastructure projects, had a playbook for screening prospective deals. In 2006, the guidelines were codified in eight “performance standards,” including whether the project might displace local communities, involve abusive labour practices or damage the environment. Although the IFC had general rules about avoiding investments that might be considered unethical, there were no specific criteria to ensure that patients at private hospitals were protected.

A former top due diligence officer said the bank saw no need to create any. “The assumption has always been that if you finance and invest in health or education programs, there are fewer social risks,” said Reidar Kvam, an independent consultant who worked at the IFC from 2010 to 2015 and was responsible for the development and oversight of its standards. “It’s not like building a dam, where you flood people’s homes or farmland. These are good projects.”

So, as the bank aimed to mobilize $1 billion for the new initiative, it evaluated potential healthcare deals with the same checklist used for construction projects. The main concern at the time was ensuring that the IFC didn’t lose money, said Ioan Cleaton-Jones, who worked as a healthcare specialist at the bank from 2006 to 2017 and helped vet investments in for-profit providers. Screening for patients’ rights was often less rigorous than vetting for financial concerns, he said, because the assumption was that most health care companies wanted “to make money by being really good at healthcare and giving people a better deal than they were getting before.”

Profit became a central focus, said Ian Clarke, an Irish doctor who founded C-Care IHK, originally known as International Hospital Kampala. “There’s a built-in contradiction in this whole international finance thing,” said Clarke, who sold a controlling stake in 2015 to Ciel Healthcare, a Mauritius-based company that had backing from the IFC. Development banks come in and say they want to help, Clarke said, but they also say, “We need to get our money back, and we need to get a rate of return.”

To ensure the bank met its dual mission — to create a positive social impact and make a profit — two teams vetted projects. One focused on finding deals that promised good financial returns, the other on potential social and environmental harms. But the second team was often constrained, according to three former IFC employees who screened healthcare investments, some of whom left as recently as 2023 and all of whom asked for anonymity to talk about internal IFC matters. There was so much internal pressure on investment officers to make deals and disburse funds, they said, that flagging potential harms was often viewed as an annoyance.

The push to expand the portfolio also led the IFC to partner with private equity firms. In those deals, oversight was left mostly to the investment firms. In others, the bank relied on companies to report and assess their own problems.

In 2019, the IFC issued ethical standards in healthcare that call for providers to deal “humanely with all patients, including those who do not have sufficient funds for treatment.” But the standards are voluntary. Some hospitals where Bloomberg found accounts of patient detention have signed on to those standards. C-Care IHK in Uganda has not. In December 2024, after questions from Bloomberg, the IFC said that in the future it would only invest in healthcare companies that agree to abide by those principles.

Farid Fezoua, who oversees the IFC’s global health strategy, said it would be an “immediate dealbreaker” if the bank found out that a hospital chain it was planning to invest in was mistreating patients. “If we get a report about patients’ rights abuses, from whatever source,” he said, “we act by sitting down with the management of an investee company and request answers to our questions.”

Patient detentions have been making headlines in Uganda since at least 2016, when Patrick Obiga was involved in a life-threatening accident. Obiga, a security guard, was rushed to C-Care IHK, the same hospital where Miracle’s family would later seek help.

It took a few weeks, but by the time a doctor told his family that Obiga was well enough to go home, his bill had grown to about 40 million Ugandan shillings ($10,800), according to court records. The family scraped together half the money and asked the hospital to release him while they worked to pay off the balance.

But the billing manager said no, Obiga’s sister said in an affidavit. Days later, after the Center for Health, Human Rights and Development in Uganda filed a lawsuit arguing that imprisoning patients was unconstitutional and amounted to torture, the hospital released Obiga. The case was later settled out of court, with IHK agreeing to waive his remaining bill.

Most Ugandans do not have health insurance, leaving many people scrambling to cover unexpected medical bills, said Clarke, who had sold a controlling stake in the hospital months before Obiga’s case unfolded but still sits on the board. He told a Ugandan newspaper at the time that IHK was struggling with patient debt. “How are we going to operate as a hospital since we are losing hundreds of millions of shillings to patients who go away without completing the payment of the medical bills?” he said.

The company that bought the hospital, Ciel Healthcare, did so with the help of a $6.8 million investment from the IFC to expand access to medical services in sub-Saharan Africa. Ciel Healthcare is owned by a Mauritius-based company that also operates luxury hotels, sugar plantations and other businesses in Africa. The Obiga case didn’t stop the IFC from lending Ciel an additional $4 million in 2020 to help its hospitals meet patients’ needs during and after the Covid pandemic. Ciel declined to comment.

It’s not a hospital for people like us

Sundhoo, C-Care Uganda’s CEO, said in an email that the hospital learned lessons from the Obiga case. “This incident and public sentiment prompted us to review and refine our hospital procedures, particularly in the areas of patient communication and financial management,” he said. “We have not had any similar cases since.”

C-Care IHK’s general manager, Miriam Mutero Musinga, said the hospital will always stabilise a patient in an emergency. But she said that if there is time, the hospital is now more focused on vetting customers before they’re admitted to avoid detaining patients. “Our past experience showed us that even if we kept them, they still wouldn’t pay,” Musinga said. “So we try not to keep them at all.”

But two staff members who worked in senior positions at the hospital in recent years said the practice didn’t end with Obiga’s case. They said security guards were alerted whenever a patient’s debt exceeded three days of care so they could ensure the person didn’t leave until the bill was addressed. One woman who owed the equivalent of $2,300 for the birth of her baby managed to escape, according to hospital records seen by Bloomberg.

At another IFC-backed facility in Uganda, Kampala Hospital, a doctor’s corpse was held for several days after he died in 2021 when the family couldn’t pay a 90-million-shilling bill, the Ugandan newspaper the Daily Monitor reported. The hospital released the body after a member of parliament intervened. A hospital spokesperson said the matter was handled promptly “in accordance with normal administrative practices and international standards.”

Across town, at TMR International Hospital, 9-year-old Umar Muwonge spent weeks in intensive care after contracting tetanus in 2021. When his family couldn’t pay his bill, he was detained for more than a week, according to relatives. Umar’s mother said he often cried when told he couldn’t go home and would ask, “Are we in a prison, mama?”

Umar’s aunt, Lilian Namagembe, a journalist who had written about hospital detentions, never expected it to happen to her family. She said she is grateful that TMR saved her nephew’s life and let him go after only a portion of the bill was paid. But she said if public hospitals were better, the family never would have been in that situation: “We had two options: Let the boy die or go to TMR.” The family still owes the hospital more than $50,000.

Daniel Talemwa, majority owner and executive director of TMR, said the hospital never detains patients. He said Umar was moved to a guest house used for out-of-town patients to ensure he’d get follow-up care that the family would have struggled to provide at home. Yet in communications seen by Bloomberg, Talemwa said the family’s unpaid bill was too high and that they needed to find more guarantors before the boy could leave. Talemwa said he couldn’t comment unless Bloomberg shared copies, which Bloomberg did not do to protect the confidentiality of the person who provided them.

The IFC invested in TMR through a Dutch investment fund, XSML Capital. A spokesperson for XSML said the hospital had assured the fund that it never detains patients. TMR has also received funds from development banks in the UK, France and the Netherlands.

At C-Care IHK, staff face increased pressure from hospital executives to avoid admitting patients who might struggle to pay, according to the two former employees. A financial form seen by Bloomberg shows the hospital requires a deposit of Shs5 million (Approx. US$1,300), before someone can be admitted to the ICU.

The consequences have sometimes been fatal. In June 2021, a relative drove Angel Nakasango to the hospital’s emergency room entrance as she was struggling to breathe. Her relatives feared she had Covid, said the brother, Jolly Kasango, who works for a healthcare technology company. Kasango knew that public hospitals were overwhelmed during the pandemic and that C-Care IHK was expensive. But he said he planned to sell land he owned to fund her care.

When Angel showed up at the hospital, a case manager told the family it needed a deposit of several million shillings before it would treat her, Kasango said. The family hired an ambulance and drove across town to Kampala Hospital. But that hospital also required a large deposit, Kasango said. He pleaded with staff for more than half an hour to no avail. He returned to the ambulance a few minutes before his sister died.

“How could they leave someone to die in an ambulance within the hospital premises?” he said over tea at a Kampala café in October.

C-Care Uganda’s Sundhoo said the hospital had no records regarding Nakasango. Kampala Hospital said its policy is for patients in life-threatening situations to be stabilised, regardless of their financial situation. “We have recently undertaken a comprehensive process to formally document and strengthen these practices,” said Moses Musiime, a hospital spokesperson.

Patients’ rights advocates in Uganda said they’re frustrated the IFC hasn’t acted more quickly.

“The IFC’s failure to take action against health facilities that benefit from IFC funds and yet detain patients who are unable to pay the hefty bills is failing Ugandans,” said Angella Kasule Nabwowe, executive director of the Initiative for Social and Economic Rights, a human rights organization in Kampala. “Why should IFC money go to private entities that are charging hefty fees, arbitrarily detaining patients and causing them trauma?”

In late September, after Miracle got out of C-Care, her mother worried about what she might do the next time there was an emergency. The nonprofit had told her it wouldn’t be able to cover another stay in the ICU. Miracle, who was still having trouble breathing, lay listlessly in her mother’s lap at their one-bedroom home down the hill from the hospital. But she perked up when she heard her father, Ezekiel Dieu-Donne, call out “Miiiiiiirrrracle” after returning from his night shift as a security guard.

Dieu-Donne earned about $3 for his night shifts, which had to cover all of the family’s expenses. He pulled Miracle’s medical records out of a plastic bag and laid them on the table. He pointed at the bill for Miracle’s September ICU stay: Shs26 million.

“I can’t even dream about that amount of money,” Dieu-Donne said. “C-Care IHK is like a shop with a fancy window display that draws you in. But before they give you services, you have to pay. It’s not a hospital for people like us.”

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The original report of this story has been edited to fit. It was compiled with assistance from Patience Asaba Katushabe, Leila Hussain, Cliff Harvey Venzon, Advait Palepu, Fred Ojambo, Simon Marks, Nduka Orjinmo, Regine Cabato and Yinka Ibukun

Source: BLooomberg