Oligopoly best describes the market structure within which hospitals operate. This is because the number of healthcare facilities, in most cases, is not enough to form a perfectly competitive market. Similarly, they are not few enough to describe a monopoly.

An oligopoly is a market structure in which only a few players dominate. In such a market, the competition is often limited. The companies can decide to either collaborate or compete against each other. If they decide to collaborate, they will be able to leverage their market power to determine prices.