Virus or No Virus, U.K. Says Hospital Deal Hurts Competition

(Bloomberg) -- The U.K.’s merger watchdog said Circle Health Holdings Ltd. must address competition concerns following its purchase of private hospitals -- even though that capacity is currently under government control.

While Circle Health’s acquisition of BMI Healthcare Ltd. poses no concerns at a national level it would hurt competition in two British cities, the Competition and Markets Authority said. The deal will be referred to an in-depth probe unless the parties offer remedies, the CMA said in a statement Wednesday.

The private hospitals came under control of Britain’s National Health Service in March under a deal intended to relieve the pressure on front-line medical services. The companies said they previously received permission from the CMA “to co-operate on Covid-19 related operational matters.”

“We recognize that this is a difficult time, with private hospitals having effectively put their entire hospital capacity temporarily under the control of the NHS to deal with the Coronavirus outbreak,” CMA director Joel Bamford said. “It remains important that we protect competition between private healthcare providers and the benefits it can bring to patients.”

The CMA said Circle Health and BMI are set to compete closely in the cities of Bath and Birmingham “and there are limited other competitors available for patients.”

Circle Health said that the deal should be approved “subject to local issues being resolved in two of the 52 markets in which the groups operate.”

The agreement with the NHS “has seen some of Circle and BMI’s sites converting existing wards and treatment areas to highly specialized and complex cancer, cardiac and emergency care clinics, enabling vulnerable patients across the country to continue their NHS treatment,” Circle Health said in a statement.

©2020 Bloomberg L.P.

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