The head of the UK’s largest private healthcare group has insisted he does want to compete on price with NHS hospitals, and it would be “madness” to prohibit price competition.

General Healthcare Group chief executive Adrian Fawcett’s comments are in direct opposition to those of other private providers to the NHS, who have warned price competition could harm care standards.

In March 2011 the government struck all references to “maximum tariffs” from its Health and Social Care Bill, in an attempt to reassure critics that the NHS reforms were intended to promote competition on quality, not price.

But in an exclusive interview with HSJ, Mr Fawcett said the legislation should not rule out price competition.

“From my own company’s perspective, I would happily see competition on price as well as service. He said there were some services where he could not see a way for providers to differentiate themselves other than on price.

Health economist critics of price competition argue that its introduction is prone to undermine care standards, because commissioners find quality harder to monitor than price and therefore focus on the latter.

Many private healthcare operators have backed that view in the NHS reform debate, with the NHS Partners Network warning price competition could lead “to a race to the bottom on price that would almost certainly threaten quality”.

But Mr Fawcett questioned why, when the costs of providing healthcare varied so much across the country, “would you insist on having one price?”

He continued: “Over time [we need to] look at the physical economics and it would be madness not to end up where price became part of the equation as you got more experience.”

  • See HSJ on 2 June for full interview