The private hospital sector in the UK is small compared with the National Health Service (NHS) provisions.

In per capita termsFrom a per capita perspective, there were 20 private acute beds per 100.000 population

in 1997/1998 compared with 219 per 100.000 in the acute NHS. The value of private acute hospitals and

clinics supply in 1999 for acute medical/surgical inpatient and outpatient labour was £1.548 millions.

The private health care market is complex and quite concentrated. The three largest medical insurance

companies are Bupa, PPP and WPA. Insurers have focused their cost containment efforts on reducing

provider prices charged by private hospital.

The demand volume for private healthcare has always been associated with dissatisfaction due to public

supply provided by the NHS. There are some 14.000 private practice consultants in 15 medical and surgical

specialities in the UK. The estimated average net private income per NHS consultant in 2000 was £44.000.

Within the acute sector, privately-owned hospitals compete with each other for business in the same way

as private insurance companies do for large, stable insured populations. In this competition, the private sector

has focused on reducing margin rate strategies. We consider unlikely that an aggressive reaction of the private

sector will outbid the NHS for consultant time.