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• W2068702016 abstract "In a statement last month, the Office of Fair Trading (OFT) said it would explore the private healthcare sector amid concerns that competition and patient choice are being stifled. Sonya Branch, OFT senior director of services and public markets, said: ‘We are keen to establish whether patients and buyers of private healthcare services, including the NHS, are getting the full benefit of choice and competition.’ Laing & Buisson estimate that the UK private healthcare market is worth £5.6 billion a year. The fact that this is a profitable industry might be deduced from the proportion of private capital that is funding healthcare provider chains; the purchase of UK private hospital groups by overseas investors; profitability of insurers and of course the earning potential of consultants. So what might the OFT find when it asks its four questions? First, are there restrictions on the ability of consultants to practice? On one level, there jolly well should be as patient safety is paramount: only consultants that are appropriately accredited can join the medical society of any private hospital group, or charge insurers for treatment of their patients. On another level, the NHS consultant contract binds consultants to their main employer, particularly when it is an acute foundation trust, such that there is limited scope for establishing new innovative provision. But outside of contracted time, consultants can and do practice from more than one private hospital, even where these providers may be in competition with one another. Second, is the concentration of providers too great? Yes. The market is dominated by H5—the five biggest groups which account for 80 per cent of private hospitals and 85 per cent of all private hospital beds. Recent experience tells us that the smaller independents get swallowed up when they come to market, the most recent example being Abbey, purchased by BMI late last year. Third, are there barriers to entry for new competitors? Yes. Capital requirements, driven in the main by quality concerns, make it expensive to join the party. But there does remain a wide range of smaller providers, perhaps not so hidebound by expensive fixed sites, which are developing single specialty solutions, often characterized by increased flexibility over location, time of service and with increased use of IT. For these providers it is the insurer networks that form the biggest and, perhaps, least transparent barrier. Fourth, do consumers exercise choice? We all know how people become ‘patients’ when faced with the medical professional. Most commonly, choice is exercised under the clear direction of their doctor—whether this is asking the GP about consultant referral, or preference for the private hospital where a treatment will take place. So is competition and choice being stifled? The industry is clearly characterised by concentration in a small group of powerful players, whether this is the hospital providers, or the five main insurers that dominate the market. Both providers and insurers appear to be robustly profitable, and consultant earnings remain buoyant, too. The upshot is that consumer prices in the UK are allegedly relatively high, both insurance premiums and also self-pay. So, the OFT might find that there is competition, but with winners and, erm, winners. BJHCM acting Editor Peter Black SUB Editor Carole Mongin-Bulewski conSUltant Editor Philip Housden dESign ExEcUtivE Peter Constantine PUBliShing dirEctor Adrian Johnston aSSociatE PUBliShEr Peter Black BUSinESS managEr Christopher Riley ProdUct nEwS Rachel McElhinney managing dirEctor Ben Allen" @default.
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• W2068702016 date "2011-01-01" @default.
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• W2068702016 title "Winners, and, erm, winners" @default.
• W2068702016 doi "https://doi.org/10.12968/bjhc.2011.17.1.5" @default.
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