務質量的確保產生嚴峻的挑戰。This paper investigates the evolution of Taiwams health care industry since the
institution of National Health Insurance (NHI) in 1995. The enactment of National Health
Insurance has boosted the general public)s utilization of health care services and, as a result,
enlarged the market size of the health care industry. However, the expansion of market
size has also led to a sharp decline in the number of small hospitals. By contrast, there is
an increase in the scale and number of large hospitals. Moreover, the number of clinics
grows stably as well. Thus, there is a polarization of the health care industry in Taiwan.
The growth in the scale of hospitals can be attributed to (a) the design of the NHI payment
and copayment systems, which financially favors large scale hospitals, (b) consumers)
preference for quality of service, and (c) the tax concession of capital investment by private
hospitals. On the other hand, the hospital market becomes more concentrated also due to the
exit of small hospitals. In addition, the consolidation of public hospitals and size expansion
of private hospitals has tilted Taiwams health care industry toward the private sector. To
improve their profit margins, hospitals have increasingly introduced services not covered
by NHI and expand vertically or horizontally by acquiring other medical organizations.
The trend of rising market share of private hospitals and marketization of health care bring
about new challenges to the NHl>s approach to cost containment, resource allocation, and
assurance the quantity and quality ofNHI health care.