Outlook It feels instinctively wrong to be rooting for the big guy. But in the messed-up world of private healthcare provision, that is precisely what we should be doing.
For many years, Bupa, the country's biggest provider of medical insurance, has been seeing customer numbers slide due to the unaffordability of its premiums for most people. And for many years, it has been complaining about getting ripped off by the hospitals which abuse their quasi-monopoly position.
Now, in the starkest terms, the Competition Commission has said that Bupa is right.
Despite all the muscle that goes with being the biggest health insurance company in the country – with £4.5bn of sales in the first half – it was still unable to avoid being fleeced.
You need only a quick glance at the numbers to see the impact of the racket: the backers of private hospitals are getting back more than double the cost of their investment, with that profitability increasing sharply thanks to low interest rates. The commission calculates that this means insurers – and therefore consumers – are being ripped off by up to £193m a year.
Bupa, meanwhile, is having to clamp down on paying claims in order to stem the financial impact of losing 100,000 or more customers every six months.
Little wonder, then, that private equity firms have been big backers of the sector, with Cinven in particular piling in. So confident has it been in its backing of Spire – the biggest provider in the country – that earlier this year it decided the time was right to sell and lease back a third of its properties. (Some will recall how a similar tactic helped send Southern Cross off to that corporate care home in the sky.)
Cinven was also, until 2000, a big investor in the operator of BMI Healthcare, one of the other hospital operators criticised by the Competition Commission. Nowadays BMI, and the third major named-and-shamed operator, HCA, are owned by foreign operators.
While the Competition Commission is clearly right to recommend breaking up the local strangleholds these businesses have in certain parts of the country, it must be aware of the fickle nature of private equity and foreign investors.
If they no longer feel their investments here are yielding sufficient returns (and with interest rates likely to rise in the coming years, this will become a growing issue) they may decide to scale down or pull out of the UK altogether.
Bupa really would be in trouble then. But, more importantly, given how a growing proportion of NHS work is nowadays being handled by the private sector, so would we all.