Exploring Competitive Interactions in Indonesia's Healthcare Sector

In Indonesia's Healthcare sector, public complaints highlight issues such as consumer discrimination, limited access to quality services, and monopolization by major pharmaceutical companies. This paper examines the dynamic interactions within Indonesia’s healthcare sector, focusing on the potential for unhealthy competition that could harm both society and business harmony. This study was carried out using a qualitative descriptive approach. Various data were obtained from individual and group interviews through purposive selection. The study was conducted at two private hospitals and two government hospitals in each city. The analysis applies Porter’s Five Forces framework to describe the market structure using a descriptive analysis approach, assessing whether the environment fosters unhealthy competition. The study finds that competition intensity is generally low, due to weak consumer bargaining power, strong provider influence, limited availability of substitutes, and significant barriers to market entry. Key findings highlight service and price discrimination driven by information asymmetry, the growing trend of vertical and horizontal integration among providers, and society’s dependence on public insurance. These results are relevant for shaping policies aimed at curbing unhealthy competition while maximizing societal benefits. The study recommended implementing necessary supervision regarding vertical and horizontal integration in order to avoid price and service discrimination. The study also suggests the need for further research to reevaluate and adjust business practices in Indonesia’s healthcare industry.