OBJECTIVE: To discuss the advantages and disadvantages of the non-price competition in Chinese hospital market and suggest some solutions. METHODS: Using the competition theory in health economics to analyze the situation in China and the advantages and disadvantages of the price competition as well as the causes accountable for the disadvantages. RESULTS & CONCLUSIONS: The government is suggested to understand the comparative (dis)advantages brought about by non-price competition and take possible solutions such as to clarify the role of market mechanism in regulating hospital performance, establish effective supervision system and referral system, and rationalize the income of physicians etc.