Competition in Hospitals

Document Type:Case Study

Subject Area:Health Care

Document 1

Oak Bluffs is likely to present the most objection because they are the hospital located in that community and any other physician setting up business in that community is a threat to their normal sales and also profit (Bloom, Propper, Seiler & Van Reenen, 2015). The new physician might come with extra expertise in medicine hence getting all the patients which will, in turn, send Oak Bluffs Hospital out of business. The project was meant to increase market domination and probably increase profits so the Lake View Medical center would be aiming to put Oak Bluffs Medical Center out of business especially due to old grudges. The subsidized rents for 30 months would also mean trouble for Oak Bluffs for 30 months. The subsidized rents would attract a lot of physicians who will be willing to set up in the area without any question.

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They might have an idea that will change the rigid scope of the Oak Bluffs medical mentality. New physicians also provide alternatives in case the Oaks Bluff staff are very busy and cannot attend to the many patients. When they are overwhelmed the LMC physicians present massive assistance. While engaging these physicians the competition is ultimately eroded and Oak Bluffs can even refer its patients to these physicians (Bloom, Propper, Seiler & Van Reenen, 2015). In case there is an urgent shortage of medicine in Oak Bluffs these physicians might offer immediate alternatives and ensure that patients are catered for. However, just like in business you have to be on your toes and always look out for competition which might outdo you in the market.

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The LMC physicians might present an option for the Oaks Bluff when they are in need so it’s not a big threat. The project may be good for the health of the community during emergencies, in case the Oaks Bluff run out of supplies and so on and so forth. There might also be instances where the patient’s condition can only be solved by physicians from the LMC. In this case, the project might be a blessing for the Oaks Bluff and the community as a whole because many lives will be saved. Both parties should be concerned about their actions being perceived as an antitrust violation. These are laws meant to protect commerce from abusive practices such as restraints, monopolization, and discrimination.

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Firstly, in lowering prices and providing subsidies because of competition, the Oaks Bluff Community Hospital will violate these laws. Secondly, Monopolization, where the customers are expected to only make purchases from one entity, is also a violation (Markovits, 2014). Oak Bluffs will also be affected here, by organizing campaigns and trying to monopolize the Oaks Bluff system they will be also causing restraints which is another violation. References Bloom, N. , Propper, C. , Seiler, S. , & Van Reenen, J. The impact of competition on management quality: evidence from public hospitals.  Determining Legality and Defenses (Vol. Antitrust Laws and Trade Regulation, Second Edition. Markovits, R. S. The Need to Analyze Separately the Monopolizing Character,“Abusiveness,” Competitive Impact, and Economic Efficiency of Business Choices.  International Journal for Quality in Health Care, 26(suppl_1), 74-80.

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