UK consumer and competition authority the Office of Fair Trading (OFT) formally launched an investigation into the private healthcare market in March.
The OFT said in December 2010 that it intended to probe the market and it has now outlined the remit of its investigation.
It will examine the nature of competition in private healthcare provision, in particular, how private healthcare providers compete on the price and quality of treatment.
This will include the NHS’s role as a provider of privately funded healthcare, for example, through private patient units.
Alongside this it will look at the concentration of provision and whether there are any barriers or limits to entry at a national, regional or local level.
It will also investigate the relationships between private healthcare providers, private medical insurers, consultants and GPs and the role of consultants.
Finally, it will examine whether or not there are any constraints on consumers in terms of how they can access and assess information about private healthcare providers, how they exercise choice and how the provision of private medical insurance affects private healthcare provision.
A progress report is expected to be published in late summer with a final report by the end of the year. The OFT said that interested parties can submit their views by email.
In a separate development, figures from private healthcare provider BUPA have shown just how tough the market is for many providers.
In March BUPA reported a 72% plunge in profits and revealed that it had axed 15% of its workforce, around 500 jobs, at its UK private medical insurance business BUPA Health and Wellbeing.
While healthcare reforms in the US and a volatile market in Europe had affected the figures, the group also pointed to the recessionary climate and rising unemployment as influential factors, cutting the demand for health insurance as companies reduced the number of staff and payrolls.
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