ENGLISH ABSTRACT: In the field of Economics, the term “competition” refers to the method involved in steering an increase in supply, which leads to a decrease in equilibrium price and an increase in equilibrium quantity. However, competition involves more than just an increase in supply. In any economy, competition can affect factors, such as innovation, efficiency and the accessibility to goods and services. In some cases, the effect might not be positive, if the goods and services only benefit certain parties involved, rather than the general population. Traditionally, there are four basic types of market structure, with each structure displaying unique market power characteristics, which are initiated by an organisation’s profit motives. All market structures, other than that of perfect competition, are forms of imperfect competition. One such imperfect market structure is oligopoly, which has certain unique characteristics (Doyle, 2005:198). In the private health care sector, cost increases can be related to the increased market concentration, due to the increase of market power by hospital groups. Therefore, the prevalence of competition in the private health care sector should be monitored.That health care functions in a dynamic environment has been historically proven and can also be seen in the latest trends. A bundle of factors, rather than a single factor, determines success. Any overview of the international health care industry should demonstrate the rapid development of the industry. The industry, compared with the relatively elementary and experimental health care system of a few decades ago, is currently super specialised. A shift has taken place in the market from the role of the industry as a government-funded health care provider to that of a private hospital provider. In South Africa, the complexity of the health care sector is made even more complex by the many role-players and the interaction between the different private and public health providers. The cost of access to hospitals should be prioritised. Research shows that the private health care sector caters for the health needs of almost seven million people, who comprise only 15% of the total population. However, the sector has spent more money than the entire public sector, with the per capita expenditure exceeding that of the public sector eightfold. The increase in the cost of private hospitals in South Africa has been caused by changes in the market concentration. Such expenditure has given the private hospitals greater market power and has influenced their behaviour.
