The Office of Fair Trading (OFT) has urged the Competition Commission (CC) to launch an inquiry into the private healthcare sector.
After a public consultation held in January, the OFT suspected that competition was being restricted in the £5.5 billion private healthcare market.
The body believes that the private healthcare sector "could work better" for patients and raised a number of concerns.
These include a lack of information about the pricing and quality of services that would help Brits compare healthcare providers and the small number of companies available which limits choice and competition.
David Mobbs, chief executive of the not-for-profit provider Nuffield, told BBC News: "Patients need to have choice so they can be reassured they are getting access to the most appropriate care.
"This can only be achieved if the industry commits itself to providing transparent information about treatment options, quality and associated costs."
The CC can force firms to alter their business operations if the commission feels they are harmful to market competition.
