Impact of Market Competition Forces on Health and Medicare Care Outcomes

Impact of Market Competition Forces on Health and Medicare Care Outcomes
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Impact of Market Competition Forces on Health and Medicare Care Outcomes
Regardless of the industry, competition is encouraged as a way of increasing value to the consumers. Competition ensures that there are better products and services that have the capacity of satisfying the needs and preferences of the consumers (Rivers & Glover, 2008). For the past several decades, different law and policy makers have tried to find the best initiatives that can reform the America’s health care system and reduce the costs associated with it. One of the ideas was to introduce competition into the market to allow the industry operate like any other market in the economy (Dayaratna, 2013). After the introduction of competition into the health care market, it became an imperfectly competitive market that comprises both monopolistic and oligopolistic markets. Factors contributing to imperfect competition market include entry barriers such as high capital, professional licensing and expensive training of medical practitioners, asymmetry information and non-homogeneous services. These factors have made the health care market to be highly competitive.
Competition in the health care industry has different ways in which it impacts health care outcomes. Various scholars have tried to demonstrate the relationship between competition and the quality of health care being offered to the consumers, patient satisfaction and health care costs. These studies have demonstrated that, market competition in the industry has significant effects on the quality of services being offered, health care costs as well customer satisfaction (Gowrisankaran &Town, 2003).
Competition in the health care industry markets has led to high level of differentiation and specialization. To outdo their close competitors, some hospitals have differentiated themselves from others and have included specialized services for the customers. The need to improve the quality of care is what has driven the hospitals to differentiate themselves from their competitors and provide specialized services to their customers in order to remain competitive in the market. This has also lead to loyalty in the industry. Those hospitals that offers quality and specialized services have earned loyalty from their customers. They cannot go to other hospitals where they do not know what services they offer.
Another impact of competition in the industry is improved quality in healthcare delivery. This implies that there is an improvement in the appropriateness of services. The quality of decisions in regard to patient care has been improved as well due to this competition. Also, market competition in the industry has also led to practitioners to improve their level of skills by continued personal development which is one of healthcare’s core competition.
Consequently, as a result of market competition, there i...