News / OFT cracks down on private price sharing

The Office of Fair Trading has received assurances from eight trusts that they will no longer exchange information about their private patient unit prices.

The trusts – members of the Southern Region Private Healthcare Association – were approached by the OFT after a whistleblower raised concerns that the sharing of pricing data contravened competition law.

It is understood the trusts gave voluntary assurances that they would no longer share the data and will provide further training to their staff on the importance of complying with competition law where applicable.

The OFT said exchange of commercially sensitive pricing information can result in higher prices for customers as it can diminish incentives on organisations to compete on price and has the potential to facilitate collusion. Where this behaviour is caught by the Competition Act 1998, it can constitute a breach of the law and may result in financial penalties of up to 10% of worldwide turnover.

All public bodies, including NHS trusts, are subject to the Competition Act 1998 when engaged in the commercial supply of goods or services, such as paid treatments for private patients. The OFT will write to all NHS trusts and foundation trusts that have private patient units to underline the need to comply with competition rules. ?

OFT services, infrastructure and public markets group director Deborah Jones welcomed the trust assurances. 'However, 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,’ she said. ‘We urge all trusts to take steps to ensure that they are compliant with competition law when engaging in commercial activity.’

The news comes as foundation trust regulator Monitor confirmed that the private patient income cap will be abolished from 1 October this year. Instead foundation trusts will be required to ensure their total income from NHS-funded goods and services is greater than their total income from any other sources.

Provisions in the Health and Social Care Act 2012 that provide for additional oversight and scrutiny of an FT’s non-NHS funded activities by governors will also commence on 1 October.