Differentiation Strategy in Online Physician Competition: Does Specialization Matter?

Objective: We aim to investigate how a specialization differentiation strategy impacts a physician’s online economic rewards and the market conditions under which a specialization differentiation strategy has stronger effects.

Methods: The study was performed using data from the health care system of the People’s Republic of China. We used physician-based secondary data (data that were collected by someone other than the researcher) in an econometric analysis of transactions obtained from an e-consultation website (haodf.com) for four clinical specialties (pediatrics, endocrinology, gynecology, and oncology) from 2008 to 2015. Patient economics are not considered in this study. A total of 1,153 physicians were included in the analysis.

Results: The specialization differentiation strategy has a significant positive impact on the physician’s online income (β = 0.009, p < 0.001) and service price (β = 0.003, p < 0.001). Moreover, specialization will improve a physician’s competitive advantage in terms of income (β = 0.129, p < 0.001) and service price (β = 0.024, p < 0.01) when market competition is more intense.

Conclusions: Physicians whose expertise is different from that of the majority have higher online incomes and service prices, and this impact will be stronger when market competition is more intense. Our study indicates that e-consultations may accelerate the specialization trend observed in the health care industry because the online market favors more-specialized physicians, and competition in the online market is stronger than in the off-line market. The e-consultation impact may be positive for some complicated diseases but less positive or even negative for chronic diseases, and therefore, policy-makers should be cautious about unintended consequences.