Competition among NHS hospitals in England reduces death rates and decreases patients’ overall length of stay at no extra cost, researchers have found.

Two separate pieces of research have backed the introduction of competition and patient choice by the last government in 2006, finding it increased efficiency while improving the quality of care.

Policies to allow patients to choose which hospital they go to, and the introduction of payment by results, were found to have improved outcomes by the researchers based at Imperial College London in one study and the London School of Economics in the other.

Imperial College professor of economics Carol Propper said: “The choose and book and fixed price regime in the NHS appears to create clear incentives for hospitals to become more efficient. Quality has risen without a commensurate increase in costs.”

The Imperial report found patients were exercising their right to choose and were prepared to travel further afield for treatment at hospitals offering shorter waiting times and good Care Quality Commission scores.

The studies found the length of patient stays was shorter in hospitals located in competitive areas - and that was not due to patients being discharged too quickly under a “quicker but sicker” model.

Ms Propper said payment by results forced hospitals to attract patients and compete on quality rather than pricing. She added that fixed pricing was essential to that and she warned against moving away from the fixed price model - as planned by new health secretary Andrew Lansley.

She said: “A free-for-all in prices would mean a return to the ‘internal market’ of the 1990s.

“We know that these arrangements led to poorer quality in competitive areas, as hospitals competed vigorously on waiting time and ignored aspects of quality that are more difficult to measure.”