The purpose of this paper is to provide a critical review of organizational power and conflict regarding the hospital-physician relationship. The issue of power being symbolic and/or substantive is discussed. The classification (Mintzberg Model) of organizations as simple structures, machine bureaucracies, professional bureaucracies, divisionalized forms and adhocracies are reviewed. Also, the issue of whether the perceived autonomy that professional employees enjoy increases the likelihood that an executive level manager in a professional bureaucracy (hospital entity) will devote substantial attention to influencing symbolic outcomes as opposed to substantive outcomes in a machine bureaucracy is discussed. In conclusion, conflicts between hospitals and physicians can be resolved in two ways: (1) by avoiding controversial decisions that might threaten the powers and prerogatives of professional groups; and (2) by agreeing to decisions that hold something for everyone involved in the hospital-physician power relationship.