Competitive advantage is a firm’s ability to attain a market advantage over its competitors (Evans, 2016). In the healthcare sector competition encompasses providers, payors, employers, and patients. Competition in the healthcare sector is quality of care, patient satisfaction, and cost. It is ensuring that the products and services meet the patient’s needs and expectations.

Three lines of business in the healthcare sector and their sources of competitive advantage are listed below.

Physician practices – Competitive advantage sources for physicians include:

  • Availability: How long it takes for a patient to receive an appointment? Wait time in the office to see the provider?
  • Empathy: The provider’s attitude (bedside matter) towards the patient is a source of competitive advantage.
  • Training experience: The provider’s experience and overall reputation.
  • Affordability: The price of care is an essential factor in a competitive advantage for physician practices. If prices are too high, patients may look elsewhere for care.
  • Accountability / Value-of care: Physicians need to be held accountable for the practice’s mission, values, and vision.


  • New technology and innovation: Competition advantage sources in hospitals are new technology and innovation. Hospitals with cutting-edge technologies attract more patients as well as in the recruitment of medical personnel.

Insurance companies

  • Keeping costs down is the competitive advantage source for health insurance companies. Access, premiums, benefit, and quality are the deciding factors for choosing health plans.

Price, quality, convivence, and services are all factors in competitive advantage. Patient satisfaction and quality are the main drivers of competitive advantage.


Evans, J. R. (2016). Quality and performance excellence. Cengage Learning.

Rivers, P. A., & Glover, S. H. (2008). Health care competition, strategic mission, and patient satisfaction: research model and propositions. Journal of health organization and management22(6), 627–641.