In Turkey, it was after 2002 through the Health Transformation Project that a real possibility had emerged to actively put market-based reforms in practice with the successive AKP governments, which has not been blocked or delayed by any other political actor. While the initial reform project in the health system in Turkey was widely seen as a positive populist move of the conservative AKP government, over time the privatization (neo-liberal) dimension has dominated the discussions in scholarly and political circles. One of the most visible examples of this dimension, the project of city hospitals, became a controversial topic regarding the public tender processes, the government's visible links to the benefiting contracting companies, and the doubts on the intentions to pursue public interests. The city hospitals project that entered into the Turkish health care system as public-private partnerships (PPP) is one of the latest projects of the AKP and intensely used as political propaganda, but could not be easily added to the populist agenda as the earlier steps of the transformation. My study will attempt to examine the special place and meaning the city hospitals have within the overall reform period in terms of putting forward the private interests. Based on the argument that the city hospitals project is a turning point from a more positive populist interpretation of health reform to a pro-capital set of projects, the questions such as “Has this turn been pushed by private interests?; if so, why is AKP accepting it – is it because the positive populism was used as a step to fully implement the neoliberal project, or is it because AKP is in fiscal crisis, too weak to continue with populism and no choice but to accept the demands of the private sector?” will be answered. The answers to these questions would contribute to the neoliberal health transformation processes in developing states as well as to the state-capital relationship literature on Turkey and make a meaningful contribution to the same literature in general with the specificities of the case.