As a capitalist I'm all in favour of people making profits. but not when it comes to public services. Those should be run by the public sector, but without the dead wood, and public satisfaction with the service should be the performance benchmark, not "efficiency" against some arbitary yardstick.
The problem with introducing private enterprise into public services is you end up incentivising the wrong behaviours, which means things get done to maximise bonus payments or other rewards, rather than just giving the punters the best service that their taxes are ultimately paying for.
Here we have a lot of services provided by private or NGO organisations, which in the UK would be provided by the state, including a lot of healthcare and organisations like the one I work for in long term mental and psychological health provision.
I'm a bit ambivalent about this to be honest.
There are certainly advantages in healthcare: the structure of the system makes it a good investment for a local government to finance healthcare provision, because the wages of staff are paid by state or private health insurance, so once the hospital is running then theoretically it is a net gain to the local area.
My field is a bit different: local authorities have a legal obligation to finance it, and they licence organisations like my employer as providers. There are several large providers mainly connected with the Catholic and Lutheran church.
In theory, this means there are several providers with several different concepts working in an area and clients are customers who have the right to a place in the organisation of their choice, so they get to pick what works best for them.
On the other it can have exactly the result that you describe: as long as the upper management can sell their concept then they get finance and the usual cost cutting, paring down front line staff, and exploiting of loopholes exists here just as elsewhere.