OFT set to launch inquiry into private healthcare market

The UK's £5.6 billion private healthcare market was today put under investigation by the Office of Fair Trading.

With government outsourcing initiatives meaning NHS spending accounts for almost a quarter of revenues paid to private healthcare providers, the watchdog has begun an inquiry into the industry's concentration and barriers to entry.

The OFT is also looking at how private hospitals and insurers negotiate the cost of treatment, and consumers' ability to access information.

"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," said Sonya Branch, the OFT's senior director of services and public markets.

Last year, private hospitals and clinics generated an estimated £3.4 billion revenue, while doctors' fees bought in another £1.6 billion. Five private healthcare insurers control 80% of the market.

The OFT is asking for input from patients, providers and the Government before formally launching the investigation in April.

Bupa, which owns a large medical insurance business, said: "We will support the OFT's market study and respond to the consultation that has been announced today."