Private healthcare providers in the UK are restricting competition through monopolistic control, lack of transparency and loyalty payments to consultants, a study by the Office of Fair Trading (OFT) has found.
The OFT proposes to refer the market for private healthcare services in the UK to the Competition Commission for investigation.
The UK private healthcare market is currently worth £5 billion and is likely to expand greatly in the near future – but according to the OFT report, the sector’s mantra of ‘patient choice’ is undermined by its own practices.
Aspects of UK private healthcare that prevent, restrict or distort competition, according to the OFT, include:
• Local concentrations of influence where a private healthcare provider owns the only hospital or an essential facility.
• A lack of comparative information for patients, GPs and insurers on the quality and costs of private healthcare services, meaning that they are unsure of the full cost of a treatment or how it compares with alternatives.
• Barriers to new competitors entering the market, such as loyalty payments to consultants and price rises imposed on insurers who recognise new healthcare providers.
As a result of these concerns, the Financial Services Authority (FSA) intends to work with health insurance providers to make it clearer to patients when they may face extra payments.
OFT Chief Executive John Fingleton said: “Our provisional findings suggest that private patients in the UK don’t have access to easily comparable information on quality and costs and that competition is also restricted by barriers to new private healthcare providers.
“It is important that patient demand and choice are able to drive competition and innovation in this market with a view to better value for all patients. We have provisionally decided that these significant concerns merit a more in-depth investigation by the Competition Commission.”
The OFT has requested comments on its provisional findings by 30 January, and expects to reach a final decision by 31 March 2012.
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