Competition and rural primary care programs.

Rural primary care programs were established in areas where there was thought to be no competition for patients. However, evidence from site visits and surveys of a national sample of subsidized programs revealed a pattern of competitive responses by the clinics. In this study of 193 rural primary care programs, mail and telephone surveys produced uniform data on the organization, operation, finances, and utilization of a representative sample of clinics. The programs were found to compete in terms of: (1) price, (2) service mix, (3) staff availability, (4) structural accessibility, (5) outreach, and (6) targeting a segment of the market. The competitive strategies employed by the clinics had consequences that affected their productivity and financial stability. The strategies were related to the perceived missions of the programs, and depended heavily upon the degree of isolation of the program and the targeting of the services. The competitive strategy chosen by a particular program could not be predicted based on service area population and apparent competitors in the service area. The goals and objectives of the programs had more to do with their competitive responses than with market characteristics. Moreover, the chosen strategies may not meet the demands of those markets.