Competition among Hospitals for HMO Business Case Study

Competition among Hospitals for HMO Business - Case Study Example The independent variables are: an index of relative hospital prices for HMO business in each market (price); high tech-capability; teaching status (teaching or non-teaching); ownership status (non-profit, for-profit, or public); and location. To provide answer to the second research question, that is, to account for the effect of the structure of the hospital market on market share, three variables were added: no. of hospitals in the market, no. of HMOs in the market, and the HMO penetration rate. For both price and non-price attributes, the regression test pointed to an effect on market share variables. Hospitals with lower prices had a bigger share of HMO business. The more high-tech a hospital was, the greater the share in the HMO business. Teaching hospitals were more preferred by HMOs than non-teaching ones. On the effect of ownership: on average, nonprofit and public hospitals had less market share than for-profit ones.