Competition in Healthcare

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Competition in Healthcare

In the U. S. economy, when companies or organizations compete for consumers’ business, consumers usually win with lower prices and better quality product (Stossel, 2007). This idea has spread to the healthcare industry and is being encouraged as a way to increase value for patients (Rivers, 2008). With the healthcare industry being a very diverse industry, there are many different forms of competitions as well as benefits and shortfalls for competition in the healthcare market.Traditional competition in healthcare involves one more elements of price, quality, convenience, superior products or services, new technology and innovations (Rivers, 2008). There are different forms of healthcare competition. One form of healthcare competition is the competition that exists between individuals who provide healthcare such as physicians and other healthcare practitioners (Rivers, 2008). These entities compete for patients who are able to pay on their own, or who have their own health insurance (Rivers, 2008). They also compete off of a non-price basis (Rivers, 2008).This means they are competing with their location, their colleague referrals, and their reputations (Rivers, 2008). Physicians and other healthcare practitioners may also compete in the medical market by reducing competition from non-physicians like psychologist (Rivers, 2008). The benefits for this type of competition are that it forces the healthcare practitioner and physicians to be more patient-orientated. It also encourages prices to competitive since some of these individuals are paying for the services out of their own pocket and is price conscious (Stossel, 2007).Another form of competition in the healthcare industry is healthcare organizations, such as hospitals (Rivers, 2008). These entities compete for physicians, third-party payers and patients (Rivers, 2008). They compete for patients by providing more services, better amenities and discounted prices (Rivers, 2008). They also compete for physicians by trying to maintain a cutting edge of competition with their technology and new medical discoveries (Rivers, 2008). The final form of competition in the healthcare industry is between organizations that provide healthcare financing, insurance and plans.These entities compete with access, premiums, benefits, quality and different degrees of freedom in choosing a provider and the benefits or coverage services. The pitfall for this type of competition is that it can often be confusing for consumers who are comparing different insurance or financing plan. Competition in the healthcare industry is being encouraged to help better the quality of care patients receive as well as reduce medical costs. When patients have the choice of where they receive medical care, competition and having a competitive edge on opponents is important.Since the healthcare industry is so large and diverse, there are different forms of competition between healthcare entities. Ultimately competition is supposed to benefit the consumer and patients. resources: Rivers, P. (2008). Healthcare competition, strategic mission and patietn satisfaction:research models and propositions. Retrieved on October 13, 2012 from www. ncbi. nlm. nib/gov/pmc/articles/PMC2865678 Stossel, J (2007). The Competitive Advantage. http://abcnews. go. com/2020/story? id=36026262&page=1