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Britain’s £5 billion private healthcare market is facing investigation by the Competition Commission.

Private health insurance market faces investigation

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The Office of Fair Trading has referred the privately funded healthcare industry to the Competition Commission after it found a number of features that prevent, restrict or distort competition in the £5bn UK private healthcare market.

The OFT found that there was a “lack of easily comparable information available” and “only a limited number of significant private healthcare providers and of larger health insurance providers at a national level”.

Five providers – General Healthcare Group, Nuffield Health Hospitals, Ramsay Health Care UK, Spire Healthcare and HCA – between them account for more than three-quarters of the market, the OFT said.

John Fingleton, OFT chief executive, 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 entering and being able to offer private patients greater choice.

“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.”

Dr Natalie-Jane Macdonald, managing director of Bupa Health and Wellbeing, said: “For too long, the lack of competition among private hospitals and consultants in private practice has pushed the price of health insurance up to unsustainable levels.

“We have been saying for some time that we need more competition and efficiency among private hospitals and consultants in the UK and are pleased this has now been recognised by the OFT.”

But private hospital group BMI Healthcare said it did not believe a referral to the Competition Commission was necessary. Stephen Collier, group chief executive, said: “We do however endorse the view of the OFT that accessible, standardised and comparable information across hospitals and consultants is essential.”