Objectives: This study is to evaluate the impact of a newly opened hospital on the operation of local clinics and to understand the competition in health care market. Methods: A Taipei local area with a new hospital opening was chosen. Four years of outpatient services claim data from all local health care providers to the Bureau of National Health Insurance were analyzed. A nearby comparison area was employed in the analyses. Results: After the opening of the new hospital, the outpatient services volume d oubled in the first year and kept increasing in the following years in the research area. However, the operation of local clinics was not affected. Their service volume and expenses increased every year, which were comparable to the comparison area. Conclusion: The opening of a new hospital did not affect the operation of local clinics. Several possible explanations were discussed.