This chapter explores the paradigm of value-based competition in healthcare, a transformative framework that shifts the focus from traditional cost or volume-based competition toward maximizing patient value by delivering superior health outcomes efficiently. Developed by Porter and Teisberg (Redefining health care: creating value-based competition on results. Harvard Business School Press, 2006), value-based competition emphasizes outcomes that matter to patients, competition at the condition level, integrated care delivery, transparency in outcomes and costs, and reimbursement models aligned with value rather than volume. Through comparative case studies, the chapter illustrates how hospitals competing on cost alone often experience deteriorating quality and rising complications, whereas those adopting value-based models achieve better patient outcomes, higher satisfaction, and sustainable financial performance. The chapter further introduces game theory as a mathematical lens to analyze strategic decision-making among healthcare providers under different payment and regulatory environments. It explains the Nash equilibrium concept and applies it to demonstrate how fee-for-service incentives can lead to suboptimal competition, while value-based care can foster collaborative equilibria promoting quality and efficiency. By integrating value-based competition with game-theoretic insights, the chapter provides a comprehensive understanding of how healthcare systems can realign incentives, encourage innovation, and improve care delivery, while also addressing challenges such as data standardization, cultural resistance, and upfront investment costs. This analysis is vital for policymakers, managers, and clinicians aiming to navigate and implement effective competition strategies that prioritize patient-centered value.