Competition and Market Concentration

Hospital markets have become highly concentrated due to increasing numbers of mergers and acquisitions. These consolidations in hospital markets may have anticompetitive or procompetitive effects due to increasing market power, economies of scale and scope and quality consequences. In this chapter, market competition and concentration and their antitrust implications in hospital markets are examined. After a brief summary of recent changes in hospital markets, the chapter focuses on the relevant economics literature on price, cost and quality consequences of market concentration, and their implications and connections with the merger guidelines and antitrust policies