The paper analyzes the current status of and problems in the development of non-government medical institutions in Shanghai, the advantages non-government medical institutions possess and the difficulties they face in the process of development. It advances the development orientation of non-government medical institutions, arguing that it is imperative to create circumstances and conditions for fair competition, formulate perfect supporting policies, and lead non-government medical institutions to the integration of their own development with the reform and development of the medical and health cause of the country. It argues, on the other hand, that non-government medical institutions must stress simultaneously the accumulation and the operation of capital so as to have a niche in the fierce competitions of the medical market.