Feature Independent Healthcare

How private providers are feeling the pinch

BMJ 2013; 347 doi: https://doi.org/10.1136/bmj.f6592 (Published 07 November 2013) Cite this as: BMJ 2013;347:f6592
  1. Sophie Goodchild, freelance journalist
  1. 1Oxfordshire, UK
  1. goodchildsophie{at}hotmail.com

The economic downturn has meant hard times for the UK’s private healthcare providers. Sophie Goodchild reports

The entire privately funded healthcare market in the UK is worth £6.4bn (€7.5bn; $10.5bn), with around one in eight people belonging to a scheme. However, this is still small fry compared with public provision. The NHS is a major client for many private healthcare providers, especially the five main hospital groups (HCA, Spire, BMI Healthcare, Ramsay, and Nuffield Health), and the Health and Social Care Act creates the conditions for the expansion of the private market. So in theory, private healthcare providers have substantial opportunities to benefit from the changes—and at a rapid rate. However, the economic downturn means that some sections of the market are feeling the pinch, according to industry analysts.

Revenues generated by independent hospitals were £4.14bn in 2011 and have barely grown in real terms over the past two years (2010 to 2012), according to analysts Laing and Buisson. Its latest review of the healthcare market shows that business generated through patients with private medical cover has been declining, although this is still the main source of funding for private hospitals.1

Tough times

Insured patients accounted for just over half (59%) of overall revenue generated by independent hospitals in 2010 compared with nearly two thirds (65%) in 2005. Part of the reason for this fall is a resurgence of faith in the NHS, thanks to the previous government (Labour) slicing waiting times, but the economic downturn has also led to people cutting back on insurance.

As numbers go down, so the marketing goes up, with companies trying to exploit negative stories about the NHS. Last month, a private health insurance comparison website was forced to take down an advertisement on the grounds that it was using an “appeal to fear” to …

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