Competition Warning for Eight NHS Trusts
Eight NHS hospital trusts have provided guarantees to the Office of Fair Trading (OFT) that they will stop exchanging commercially-sensitive information about their Private Patient Unit (PPU) prices, and ensure that they conform to competition law.
The Office of Fair Trading confronted members of the Southern Region Private Healthcare Association (SPHA) earlier this year, after they received information from a whistle-blower which noted potential competition concerns regarding the pricing data being exchanged between the SPHA members.
NHS Trusts who were confronted regarding the pricing data being exchanged were: Brighton and Sussex University Hospitals NHS Trust; Epsom & St Helier University Hospitals NHS Trust; Frimley Park Hospital NHS Foundation Trust; East and North Hertfordshire NHS Trust; East Sussex Healthcare NHS Trust; Portsmouth Hospitals NHS Trust; Dartford & Gravesham NHS Trust and University Hospital Southampton NHS Foundation Trust.
Private Patient Units allow for private treatment in a hospital within the NHS, normally offering a complete range of general and specialist medical services on site. Private treatment in Private Patient Units is covered by mainly by health insurance schemes and patients may be able to take advantage of low-cost, fixed-price surgery packages from some NHS PPUs.
The communication of commercially-sensitive pricing information can result in increased prices for customers, as it diminishes motivations for organisations to compete on price; it also has the potential to assist conspiracy. Where this behaviour is caught, it can constitute a breach of the law, and could result in financial penalties of up to 10% of global turnover.
To address the concerns, the NHS Hospital Trusts have provided confirmation that they will not exchange confidential pricing information and will provide further training to employees on the importance of obeying competition law where applicable.
The Office of Fair Trading announced that they will be writing to all NHS Trusts and Foundation Trusts which operate PPUs, enclosing assistance on competition law compliance.
The assurances given by the trusts are welcome, and have enabled the Office of Fair Trading to bring their preliminary investigation to a close, commented Deborah Jones, director in the Office’s services, infrastructure and public markets group.
However, she noted that “this does not preclude the OFT from investigating any aspect of Hospital Trusts’ economic activities if it receives further evidence of potential infringements of the law. We urge all Trusts to take steps to ensure they are compliant with competition law when engaging in commercial activity.”
“Where public-sector providers compete with the private and voluntary sectors, the OFT is committed to ensuring that there is a level playing field for all, so that effective competition encourages suppliers to offer lower prices, better quality and an improve range of goods or services,” Jones added.