Private operators may have to sell hospitals

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Britain’s largest healthcare groups may be forced to sell some of their hospitals after the Competition Commission (CC) found that a series of ownership “clusters” were forcing up prices.

In their provisional findings published yesterday, officials said that 101 hospitals face little local competition, but it did not identify any of them. It estimates the problem could be solved by ensuring the sale of fewer than 20 of those hospitals.

Operators BMI, HCA and Spire were singled out for having clusters of hospitals, giving them excessive market power in some areas.

CC chairman 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 commission claimed that market dominance from the big three caused “consumer detriment” of up to £193 million a year between 2009 and 2011.

It also highlighted incentive schemes which encourage consultants to choose particular private providers for diagnosis and treatment as a threat to competition, and proposes to ban them.

BMI, which owns four hospitals in Scotland, said it rejected “absolutely” any assertion that it exercised market power or made excess profits at the expense of patients.

Spire, which has a “cluster” in the Edinburgh area, said it had fully co-operated with the CC but strongly disagreed with some findings in its report,

Small private hospital groups and insurers such as Bupa and Axa welcomed the measures.