IDEAS home Printed from
   My bibliography  Save this article

Competition in the Provision of Hospital Services


  • OECD


Because of the high percentage of national income and government budget typically associated with the provision of hospital services and because there is substantial evidence of hospital services could often be delivered more efficiently than they are, a number of OECD countries have increased the extent to which competitive mechanisms are adopted to increase the efficiency of hospital care delivery. Hospital services are complex set of products and services than comprise many different types of patient-oriented activities and not all services are equally subject to competition. For some services, such as emergency services, a hospital may have few if any competitors. For other services, such as inpatient scheduled surgeries, a hospital may compete for patients with other hospitals that offer comparable care. For still other services, such as diagnostic services, specialist consultations and outpatient services hospitals may at times compete with diagnostic centers, doctors’ offices and ambulatory surgery centers. Competition between providers of hospital services can have a number of impacts, including reducing excessive hospital stays, reducing costs of providing care and improving quality of care. Mechanisms for increasing competition or market forces identified in this paper include: collecting and distributing improved information on provider performance; supporting new entry when entry and exit costs are low; encouraging independent or private operation of facilities; improving allocation of human resources, particularly through reducing anticompetitive restrictions by professionals; introducing prospective pricing in combination with benchmarking; physician-led purchasing; providing for greater consumer choice, particularly when waiting lists are long; introducing contestable management of hospitals; and applying competition law in circumstances where public policy focuses on pro-competitive mechanisms. A competitive mechanism that might work in one system will not necessarily transfer well to another. Moreover, competitive mechanisms may at times increase costs. As health policy makers increase reliance on competitive mechanisms, they may need to think carefully about structural market conditions and potentially involve competition authorities when it appears that participants in the market are acting to restrain or eliminate competition.

Suggested Citation

  • Oecd, 2007. "Competition in the Provision of Hospital Services," OECD Journal: Competition Law and Policy, OECD Publishing, vol. 8(3), pages 153-247.
  • Handle: RePEc:oec:dafkaa:5l4tpn57w7mv

    Download full text from publisher

    File URL:
    Download Restriction: Full text available to READ online. PDF download available to OECD iLibrary subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Kim, Byung Woon & Park, Joonho & Youl Ko, Chang, 2013. "Cost allocation of WCDMA and wholesale pricing for mVoIP and data services," Telecommunications Policy, Elsevier, vol. 37(1), pages 35-47.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oec:dafkaa:5l4tpn57w7mv. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.