Required Resources
Read/review the following resources for this activity:

• Textbook: Chapter 9, 10
• Lesson
• Minimum of 1 scholarly source (in addition to the textbook)

Initial Post Instructions
Consider the following statement:

Firms in the healthcare industry do not seem to have features of a perfectly competitive market structure and, therefore, must not be classified as such. Those firms fall somewhere within the continuum from monopolistically competitive and oligopoly markets to monopoly markets (specifically regional monopolies).

For the initial post, decide if you agree or disagree with the statement.

• If you agree with this statement, provide at least two examples of firms in the healthcare industry (pharmaceutical companies, medical centers, insurance companies, etc.), and identify the features the firms you selected have that make you believe that they should be classified in one or several of the following market structures: monopolistically competitive and oligopoly market structures; monopoly market structures.
• If you disagree with the statement, name at least two firms in the healthcare industry (pharmaceutical companies, medical centers, insurance companies etc.), and provide reasons why those firms you selected can be classified as perfectly competitive firms.

Note: The two examples must come from different industry groups. For example, both firms cannot be insurance companies.

Follow-Up Post Instructions

Respond to at least one peer. Further the dialogue by providing more information and clarification.

Writing Requirements

• Minimum of 2 posts (1 initial & 1 follow-up)
• Minimum of 2 sources cited (assigned readings/online lessons and an outside scholarly source)
• APA format for in-text citations and list of references

SOLUTION

Healthcare industries are not considered to be within a perfectly competitive market, especially when we look at pharmaceutical companies and insurance companies. In the realm of pharmaceuticals, they tend to lean towards the oligopoly market. This means that “a small number of large firms have all or most of the sales in an industry” (Greenlaw et al., 2017) When we look at insurance companies such as Medicare, it tends to lean more towards a monopolistic approach where Medicare dominates the national health insurance programs in the United States.

First, let’s take a look at pharmaceutical companies. In the turn of recent events, vaccinations for COVID-19 relief are dominated by only a few firms. Kim et al. (2021) note that the only manufacturers of the vaccine with a 90%+  efficiency rate are Pzifer, Gamalaya, and Moderna. This means that there are only three firms within this industry that provide a vaccine with a 90%+ efficiency rate. Therefore, these firms will dominate the vaccine market in an oligopoly continuum as there are few competitors. Please click the purchase button to access the entire copy at $5