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Market share is a critical piece in determining the price in healthcare. Most healthcare markets are small in area, and most consumers will not travel very far to receive care. The greater the market share the greater the leverage you have when negotiating health plan contracts. An example would be if a hospital controlled 90% of the acute-care in the area, it would make sense that every plan would have to include this hospital in its network. This gives this hospital all the control when negotiating payment terms.
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