BUPA Physiotherapy Tender Process

[physiobob]

The email below was sent to all OCPPP members. Whilst it is nice that they are saying something, it reads as a very weak commentary and to suggested we are "frustrated" is NOT a term I would use for the feeling of the members. We are outraged and are seeking legal action, not just for this tender process but also for the Age descrimination of their 5+ yrs post graduation terms that have been in place for a long time AND for the anti-competitive pricing by making insisting we charge less than they themselves charge in their own clinics.

Here's what the OCPPP sent

Email Alert – Physio First & CSP go to Press and OFT over Bupa

Following Bupa’s formal letters to private practitioners last week requiring everyone to enter into their blind tender process, we are now able to announce that as a result of meetings that occurred between the CSP and Physio First on 1st April 2009, the long planned collaboration to raise issues in the national media and to instruct solicitors to submit a formal complaint to the Office of Fair Trading, has been agreed.

Although both Physio First and the CSP have known of Bupa’s stated intention to force members to take part in a blind tender process since we met with representatives of Bupa in October 2008 (full details of which were published in the October Update), neither we nor the CSP have been able to take any formal steps with the media or the Office of Fair Trading, until the details of Bupa’s blind tender were actually produced.

The Media Campaign

The media campaign was kicked off with Physio First and the CSP submitting the following joint press release to media channels:

Joint Statement from Physio First and The Chartered Society of Physiotherapy (CSP)

BUPA, the largest Private Medical Insurer in the UK, has recently announced to private physiotherapy practitioners that if they want to continue to treat BUPA patients, they must now participate in a “blind” tender process.

BUPA has asked 6,000 Physiotherapists to compete against each other to be allowed to continue to treat BUPA patients.

BUPA’s tender questionnaire requires practitioners to quote the lowest price that they are prepared to work for. BUPA has not made clear how much weighting will be given to each part of the tender and our presumption is that price will probably be BUPA’s main determinant.

There are indications that BUPA may significantly reduce the number of private physiotherapy practitioners who will be able to treat BUPA policyholders.

Speaking on behalf of Physio First, which represents the interests of private physiotherapy practitioners, and the CSP, Eric Lewis, Chairman of Physio First, said,

“BUPA’s approach to this tender has quite naturally caused considerable frustration amongst our members. These feelings are heightened by the fact that this process is not one that Chartered Physiotherapists have been subjected to before, nor is it one where the bargaining position, between very small and multi-million pound businesses, can be equalised through collective action, as coordinated action is prohibited by law under the Competition Act.

“Whilst Physio First and the CSP recognise that it’s entirely appropriate for BUPA to regularly review the services provided to their policy holders, we are concerned that patients may lose out if price is the primary consideration in this tender process, rather than the quality of health care provided, or the particular needs of individual patients. We hope that BUPA will ensure that their policy holders continue to have easy access to a full choice of Chartered Physiotherapists, and that patients will be able to continue to see a practitioner they have learned to trust.

“The vast majority of private physiotherapy practitioners are single-handed or small group practices. They are highly qualified, work very hard to treat patients, and they comply rigorously with professional standards. Physio First has had meetings and exchanged correspondence with BUPA and has pointed out the potential pitfalls that this tender strategy may produce”.

Commenting on the press release recently issued by BUPA about its tender to private physiotherapy practitioners, Phil Gray, Chief Executive of the Chartered Society of Physiotherapy (CSP), said:

"The CSP and Physio First are very concerned that BUPA’s press release appears to show that their primary motivation is reducing prices to a uniform level. BUPA’s quoting of price variations among Physiotherapists is unfair and inappropriate if they are not also quoting the differences in the clinical condition of the patients concerned, or the specialist expertise of the practitioner.

"BUPA’s apparent desire to have a uniform, fixed price for private physiotherapy does not fit with the expectation of choice of those taking out private medical insurance, or of the operation of a competitive market. If BUPA wants a uniform service standard at a uniform price, they may be encouraging customers to choose NHS services rather than the additional costs of BUPA private medical insurance."

As with all press campaigns it is difficult to predict the level of press uptake. Our view is that there are items of sufficient interest to the public to warrant press coverage and some open public debate about Bupa’s blind tender process; we are working hard with the CSP’s Communications Department, to generate the level of interest that this issue deserves.

A joint statement by Eric Lewis, Chairman of Physio First and Liz Cavan, Chair of Council “We fully understand the anguish and frustration that this Bupa initiative has caused to private practitioners. Both organisations intend to hold this process up to public and government scrutiny”.

Reporting Bupa to the Office of Fair Trading

As with the media campaign, any possibility of launching a complaint about Bupa to the OFT has had to wait until Bupa actually announced the details of their initiative.

Now that this has occurred, solicitors have been instructed to file a complaint with the OFT.

The basis of any such complaint is described in detail in the OFT Guidance note “Abuse of a Dominant Position”. A brief extract provides a flavour:

“… the OFT is empowered to apply two substantive provisions which prohibit conduct by one or more dominant undertakings which amounts to abusive behaviour … Article 82 and the Chapter II prohibition. The Chapter II prohibition provides that: '… any conduct on the part of one or more undertakings which amounts to the abuse of a dominant position in a market is prohibited if it may affect trade within the United Kingdom.'

Both Article 82 and the Chapter II prohibition provide, in similar terms, that conduct may constitute an abuse if it consists of:

(a) Directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions

(b) Limiting production, markets or technical development to the prejudice of consumers

(c) Applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage

(d) Making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of the contracts.

2.6 These are no more than examples, and are not exhaustive. The important issue is whether the dominant undertaking is using its dominant position in an abusive way. This may occur if it uses practices that have the effect of restricting the degree of competition which it faces, or of exploiting its market position unjustifiably.

For full details follow the link to the OFT Guidance Paper on the subject at

http://www.oft.gov.uk/shared_oft/bus...ines/oft402pdf

Conclusion

As with any legal remedy the outcome cannot be guaranteed nor is it possible to control the timescale – this will be a matter for the OFT.

Physio First with the full and welcome support of the CSP is however determined to take action to the extent that the law permits, to take Bupa to task over this new and unwelcome initiative.

This is a frustrating time for all of us and we are all in the same boat having to make our own decisions on how to navigate our practices in relation to Bupa’s blind tender; everyone on the Physio First Executive Committee, your Regional Officers and members of our Sub Committees would like to be able to make it go away, but we cannot and to pretend that there is a “silver bullet” would be irresponsible.

We are however determined to help members emerge from this trying time. Perhaps this development will be a catalyst for change that could leave Physio First members as a very large and unlooked for competitor of private medical insurers. After all they and other businesses are the middlemen, but we provide the service – something to think about as we produce and review our business plans and how we direct our marketing in the future!