Watchdog drops most of hospital break-up order

 
Marion Dakers
THE NEW competition watchdog has rowed back on break-up plans for London’s private hospitals, in a surprise decision that has been welcomed by some companies but left others baffled.

After two years of investigations the Competition and Markets Authority, known until this week as the Competition Commission, said one or two London hospitals must be sold.

This decision reverses last year’s order than 20 hospitals must be sold off, and scales back a ruling in January that called for new owners for seven sites.

HCA, which has been told it must get rid of either the London Bridge and Prince Grace hospitals or the London Wellington, plans to appeal.

The regulator said HCA’s market power in London, where it operates more than 20 hospitals and clinics within the M25, allows it to charge higher prices to insurers. The CMA said the firm owns more than half of the city’s overnight hospital beds.

“It’s frustrating that after two years of investigation we find out at the last minute they are changing their mind,” HCA commercial director Keith Biddlestone told City A.M. “We think now they have to ask themselves whether British competition policy is being made up on the hoof and whether that serves the UK economy well.”

The watchdog said some of its experts were no longer convinced that divestiture orders would lead to lower prices outside of the capital.

BMI Healthcare, which no longer needs to sell seven hospitals, said:  “The commission has engaged openly with us and with our arguments and evidence, to reach a sensible, measured and fair conclusion.”

The CMA confirmed restrictions on private units run within NHS hospitals, and it will also bring an end to payments for consultants who refer patients to particular facilities.

“A more transparent market with patients actively making choices will drive hospital operators to compete on the things that matter to patients,” said Roger Witcomb, head of the CMA’s Private Healthcare Inquiry Group.