- Private Healthcare Market Investigation Order 2014
Private Healthcare Market Investigation Order 2014
Private Healthcare Market Investigation Order 201428th June 2021 - Published by Kuits Intellectual Property Team
In 2012, the Competition and Markets Authority (CMA), the UK competition regulator, launched an investigation into private healthcare in the UK. The investigation was prompted following a number of changes in the private healthcare sector, such as an increase in the use of private healthcare services by the NHS, consolidation amongst private healthcare providers and the use by medical insurers of network agreements with private healthcare providers. It was felt that these changes had the potential for a negative impact on consumers.
Following its investigation, the CMA found that certain features of the private healthcare sector lead to a restriction of competition. Key concerns included the existence of certain benefit and incentive schemes operated by private hospital operators which rewarded clinicians for referring patients to, treating patients at, or commissioning tests from, their facilities and the lack of publicly available information as to performance measures of private healthcare facilities, and performance and fee information on consultants who were providing privately funded healthcare services.
This resulted in the publication in 2014 of the “Private Healthcare Market Investigation Order”. The Order applies to those operating within the privately funded healthcare sector in England, Wales, Northern Ireland and Scotland. Failure to comply with the Order can result in a private action by any person who suffers loss or damage due as a result, or proceedings by the CMA to enforce the Order.
Subject to certain conditions and exemptions, the Order prohibits any scheme, arrangement or incentive which is intended to induce a referring clinician to refer private patients to, or treat private patients at, the facilities of a particular private hospital. This prohibition applies as regards arrangements between private hospital operators, i.e. those operating the private hospital, and referring clinicians, both of whom have a duty not to give or accept such incentives, or enter into such schemes.
What does the Order include?
The Order also specifies certain information which must be published by private healthcare facilities and consultants. On the part of operators of private healthcare facilities, this includes information relating to volumes of procedures undertaken; average lengths of stay for each procedure; infection rates, readmission rates and mortality rates. Consultants are required to provide information about fees and standard terms and conditions; there is a further list of information which must be provided to patients prior to any outpatient consultation.
Whilst consultants are required to publically disclose information relating to their fees, it is important that they do not discuss fees amongst themselves (unless they are part of the same partnership), as such discussions could result in illegal price fixing.
What can happen if the Order is not followed?
Infringing the UK competition regime has serious consequences. In July 2020, the CMA imposed fines totalling over £1.2m on Spire Healthcare Limited and the Spire Healthcare Group plc (Spire) and 6 consultant ophthalmologists who it found to have infringed competition law by taking part in illegal price fixing of initial consultation fees for self-pay patients at a hospital in the north of England.