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Press Release: UK Private Healthcare Market Development Report

Released: January 2011

After researching the UK private healthcare market development and taking into account various other factors the following conclusions can be drawn from MBD's report:

Market Review 2006-2010:

In 2010. UK expenditure on private acute healthcare increased by an estimated 5% to reach £7.5 billion, consolidating the 6% increase in the previous year. This represents an overall increase of 28% compared with 2006. Expenditure has been driven by the ageing population, changing consumer attitudes and increasing demand for services not commonly available on the NHS, notably cosmetic and obesity related procedures. However, during the second half of the review period the private sector has faced increased competition from the NHS, as the Government has increased expenditure on the NHS, resulting in reduced waiting times and increased available services. However this change in Government policy has also generated income for the private sector, as the Government is outsourcing services to the private sector in order to achieve efficiency improvements in the NHS.

In 2010, UK PMI subscription income is estimated to have increased by 3% in nominal terms to £3.67 billion. This follows annual growth of between 3% and 7% since 2006. The more moderate increase projected for the latest year, is largely a reflection of the continued adverse economic conditions as the economy is in recovery stages and the negative impact on demand for PMI both for individual and corporate subscriptions. In the corporate sector, companies are continuing to focus on cost cutting measures and with a rise in redundancies and lower levels of staff recruitment, this is expected to result in fewer new PMI subscriptions. In the individual subscription sector, lower disposable incomes and increased job insecurity is also expected to exert a negative pressure on PMI subscriptions. However some trade sources suggest that PMI is likely to be one of the last things individuals are prepared to cut back, although it has also been reported customers will be looking to limit increases in spending on medical insurance.

Market Forecast 2011-2015:

UK expenditure on private acute healthcare is expected to increase by 5% in 2011, which is forecast to be followed by annual growth levels of between 5% and 7% in the following four years. In 2015, UK expenditure is expected to reach £10.1 million at 2010 prices, equivalent to overall growth of 34% in real terms compared with 2010. Demand for the private healthcare market is expected to be buoyed by the recent NHS reform which encourages competition between the NHS and private healthcare companies and the expected outsourcing of work from the NHS. A projected increase in NHS waiting lists is also expected to positively influence the private sector.

Private medical subscription income is expected to demonstrate growth throughout the five year period, although annual levels are anticipated to remain relatively moderate reflecting the relative maturity of the market and. In 2011, PMI subscription income is expected to increase by 3% in real terms, which is expected to be followed by similar growth of between 3% and 4% in the following four years. Overall, the value of the PMI market is forecast to increase by 18% in real terms between 2010 and 2015, reaching £4344 million in the latter year.

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MBD specialises in business to business market research. The range of reports and industries in which we operate in is constantly expanding (our portfolio comprises of more that 140 titles). All our reports are written by in-house market consultants.

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