Integrated delivery systems. Evolving oligopolies.
The proliferation of Integrated Delivery Systems (IDSs) in regional health care markets has resulted in the movement of these markets from a monopolistic competitive model of behavior to an oligopoly. An oligopoly is synonymous with competition among the few, as a small number of firms supply a dominant share of an industry's total output. The basic characteristics of a market with competition among the few are: (1) A mutual interdependence among the actions and behaviors of competing firms; (2) competition tends to rely on the differentiation of products; (3) significant barriers to entering the market exist; (4) the demand curve for services may be kinked; and (5) firms can benefit from economies of scale. An understanding of these characteristics is essential to the survival of IDSs as regional managed care markets mature.
Malone
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Oakwood Healthcare System, Dearborn, MI, USA.
D003365:Costs and Cost Analysis / Q000639:trends; D019033:Delivery of Health Care, Integrated / Q000191:economics / Q000458:organization & administration*; D004465:Economic Competition; D019981:Health Care Sector / Q000639:trends*; D006273:Health Facility Merger / Q000191:economics / Q000458:organization & administration; D008389:Marketing of Health Services; D018803:Models, Economic; D014481:United States