Health insurers try to slam the brakes on spiralling prices Such a move might upset some customers, said Mr Elliott. But the alternative was to stoke the ever-rising spiral of costs. That would lead to "a drift into an unsustainable health care market that very few could afford. We could drift into a market that is almost uninsurable and certainly unsustainable. Simply to go along paying mounting bills was likely to lead to more people dropping medical cover, he said. Only those with a poor medical history would continue. This would inevitably lead to a further price spiral as low-users pulled out and paid their own way or used the NHS. Mr Elliott's remarks follow a bruising battle between Bupa and American hospital group BMI. The insurer barred 37 BMI units from its approved hospital list. A compromise is said by Bupa to lead to a brake on premium rises. This suggests a victory of sorts for the insurer. At the same time, the company moved to prevent GPs from referring patients to any consultant of their choice. Instead they would have to refer to a consultant deemed appropriate and charging a fair rate. This infuriated the British Medical Association, which prefers not to be known as the doctors" trade union. But "open referral" - a policy used by other insurers too - is now in place and will help restrain costs. All this is going on against a background that could embarrass both the BMA and health care providers. The Competition Commission has taken on board a recommendation last April by the Office of Fair Trading to investigate private medicine. The OFT claims independent hospitals "prevent, restrict or distort competition." It also claims senior doctors are getting cash incentives to treat a given number of patients in a particular hospital. Insurer Axa-PPP described such sweeteners as "giving rise to concerns that they increase costs and incentivise unnecessary tests and treatments." These matters may seem remote to the international community, but insurers say expatriates often prefer to be treated in their home country. Language barriers don't apply and relatives are at hand. In making its case about UK hospital charges, Bupa pointed out that costs in Britain are "significantly higher" than Spain and Australia - the two countries in which its international arm is particularly active. However, even before the BMI run-in and the "open referral" issues came to light, Bupa International was worried about fees in other parts of the globe. An issue that should alarm any patient, not just those insured, is the propensity for some specialists to perform invasive knee investigations. A few months ago Sneh Khemka, medical director of Bupa International, first highlighted the startling fact that rates of knee arthroscopy in the UK private sector were three times those in the NHS. He said: "Doctors work on a reimbursement basis - the more they do they more they get paid." He attributed the UK situation to doctors being motivated by putting money before patients. That's the UK situation but in certain countries outside the UK I'd say the situation is even more exaggerated. While UK doctors were well regulated, the same did not always apply elsewhere. "The standards and the regulations are not there," he said. That gives doctors freer licence to practise and that leads to inappropriate intervention. Dr Khemka said the inevitable result was premium inflation. This article was first published in The Telegraph Weekly World Edition