Fears that competition rules will limit GPs' freedom as commissioners have been at the heart of the profession's concerns about health secretary Andrew Lansley's NHS reforms.
The role of the foundation trust regulator Monitor, which will expand to enforce competition across the NHS, has concerned GP leaders.
The BMA has warned that the regulator's powers to enforce competition could make it impossible for GPs and their hospital colleagues to collaborate to develop services.
But the DoH has said that consortia would be free to commission services from the providers that best meet the needs of their patients.
'Monitor would only have power to intervene under competition law where it could demonstrate that any restrictions on competition are acting against the patient and public interest,' a spokeswoman said.
Interim Monitor chief executive David Bennett said there was a lot of 'alarmist talk' about the regulator's role.
He confirmed consortia could be allowed to go ahead with commissioning decisions that compromise competition, if they could show it would be in patients' best interests.
Monitor's role would be to weigh up the 'negatives of reduced competition' and the patient benefits of the proposed plans, he said. 'If the balance is in favour of what GPs want to do then that's what they will get to do,' he said. But he admitted there could be 'difficult decisions' about what is in the best interests of patients.
GPC deputy chairman Dr Richard Vautrey said he remained concerned because legislation gives Monitor the powers to enforce competition.
He said: 'If the system was being set up so as not to give Monitor those powers then we could be reassured. But as soon as a private provider puts in a challenge, a legal hand grenade is lobbed into the system, which will prompt Monitor to say: "We have the powers and we must use them".'
He also warned that how Monitor enforces competition will depend on who becomes its permanent chief executive and the pressure it comes under from other organisations.