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03-03-2011 | General practice | Article

Backtrack on price competition


Department of Health

The government is amending the Health and Social Care Bill to remove Monitor's right to set a maximum tariff for health services.

The amendments mean providers will no longer be able to bid for contracts below the standard NHS tariff and therefore should prevent the possibility of private companies undercutting NHS providers.

Various groups including the BMA, think tanks and health economists had accused the government of introducing price competition by setting a maximum tariff, warning that quality of care would suffer as a result.

A Department of Health spokesperson said: "Our modernisation plans have always been about competition on quality, not on price. We want the tariff to be a nationally-regulated price, not a starting-point for price competition. These amendments do not reflect a change in policy, they clarify our position and put our intentions beyond doubt."

Chairman of Council at the BMA Dr Hamish Meldrum commented: "Price competition has been linked with lower quality and was of huge concern to the BMA and many others. We welcome the fact that the Health Secretary has not only listened to doctors' views, but also acted on them."

But he added: "There is of course still a long way to go to address all the concerns doctors have about the Bill, such as Monitor's powers to enforce competition. We will continue to press for further improvements and hope the government will continue to listen."

GP News is an independent clinical news service provided by Springer Healthcare Limited. © Springer Healthcare Ltd; 2011

By Caroline Price