Dearth of competition in private hospitals drives up patient costs

PRIVATE hospitals are charging patients more due to a lack of competition in the system, according to a report published yesterday by the Competition Commission.

The chairman of the inquiry which produced the report, Roger Witcomb, said: “The lack of competition in the healthcare market at a local level means that most private patients are paying more than they should either for private medical insurance or for self-funded treatment”.

The report blames the high concentration of insurance and hospital ownership, with five groups responsible for 70 per cent of healthcare revenues.

The Competition Commission estimates that the market power of three health groups, HCA, BMI and Spire cost consumers nearly £200m a year between 2009 and 2011.

The figure would make up around ten per cent of the revenues of the companies, and the inquiry suggests that this is a conservative estimate.

The researchers also suggest that the market in central London is also not constrained on price by competition.

HCA, which runs many private hospitals in London, commented on the finding, suggesting that clinical excellence and investment in research had not been properly considered as factors.

Keith Biddlestone, speaking on behalf of HCA, insisted that the company had made progress: “Ten years ago, hospitals now owned by HCA were sold because they weren’t thought viable. Huge investment by HCA has converted them into world-class centres”.