Eye surgeons’ membership organisation fined £500,000
This follows a CMA investigation into anti-competitive information exchange and pricing agreements.
A membership organisation of private consultant ophthalmologists has today admitted breaching competition law and agreed to pay a fine of £500,000, to be reduced to £425,000 if it continues to co-operate. Ophthalmologists (eye surgeons) are specialists in medical and surgical eye procedures.
Consultant Eye Surgeons Partnership (CESP) Limited, the membership organisation, was formed to represent the interests of 37 limited liability partnerships (LLPs) and their 200 consultant members based across the UK. It provides its members with a number of services including access to CESP Limited negotiated contracts with private medical insurers. Each LLP has a representative on CESP Limited’s Board.
CESP Limited has admitted to infringing competition law and the Competition and Markets Authority (CMA) has today issued a statement of objections to it. CESP Limited accepts liability for a number of infringements during the period September 2008 to present, which include:
- Recommending that its members refuse to accept lower fees offered by an insurer, and that they charge insured patients higher self-pay fees.
- Circulating amongst its members detailed price lists for ophthalmic procedures such as cataract surgery to be used with insurers. These collectively set prices did not pass on lower local costs (such as cheaper hospital fees) and made it harder for insurers and patients to obtain lower prices.
- Facilitating the sharing of consultants’ future pricing and business intentions such as whether to sign up to a private hospital group’s package price, which enabled members to align their responses.
Today’s fine includes a discount of £75,000 to reflect the resource savings to the CMA generated by the membership organisation’s admissions and continual agreement to co-operate.
The CMA welcomes CESP Limited’s proposals to implement a comprehensive compliance programme, which is a positive step ensuring CESP Limited and its members avoid breaking competition law in the future. The CMA will now review the detail of the programme and, if it is satisfactory and implemented before the CMA issues its infringement decision, grant a further reduction in its fine. The CMA intends to issue an infringement decision next month.
Ann Pope, CMA Senior Director of Antitrust Enforcement, said:
This membership organisation of private eye surgeons has admitted to anti-competitive conduct including agreeing prices, recommending that members refuse to accept lower fees from an insurer and facilitating the sharing of confidential business intentions, including future pricing intentions, between its members. As a result of this activity, the incentives for its members to compete on price were restricted, making it harder for insurers and patients to obtain lower fees.
This is the first time formal competition law enforcement action has been taken against medical professionals in the UK. This case demonstrates the CMA’s commitment to taking action in specialised and regulated sectors including the professions and makes it clear that membership organisations and their members are not outside the scope of competition law or its penalties.
We welcome CESP Limited’s co-operation with the CMA’s investigation and its commitment to introducing a compliance programme and we hope that other professional membership organisations will take note of this case and take steps to ensure they operate in a way that does not infringe competition law.
Notes for editors
- The issuing of a statement of objections is a necessary procedural step in a Competition Act investigation.
- The CMA is the UK’s primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law. From 1 April 2014 it took over the functions of the Competition Commission and the competition and certain consumer functions of the Office of Fair Trading, as amended by the Enterprise and Regulatory Reform Act 2013.
- For more information see the CMA’s homepage or follow us on Twitter @CMAgovuk, Flickr and LinkedIn.
- Further information is on the investigation case page.
- Enquiries should be directed to Kasia Reardon ([email protected], 0203 738 6901). Sign up to our email alerts to receive updates on Competition Act 1998 and cartel cases.