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Hospital Competition Continues to Transform Indianapolis Health Care Market

Continued Hospital Expansions Raise Cost Concerns

News Release
June 30, 2005

Alwyn Cassil (202) 264-3484 or

WASHINGTON, DC—The building boom that spawned four new heart facilities in Indianapolis two years ago has continued unabated, raising concerns about higher health care costs in an already high-cost market, according to a new Community Report released today by the Center for Studying Health System Change (HSC).

Much of the building boom is taking place in growing suburban areas of Indianapolis, where hospitals are intensifying competition for profitable, privately insured patients who are moving to the suburbs.

"This recent wave of hospital expansions threatens to erode the geographic segmentation that has kept the four major hospital systems on relatively friendly terms," said Paul B. Ginsburg, Ph.D., president of HSC, a nonpartisan policy research organization funded principally by The Robert Wood Johnson Foundation.

Despite the increased competitive environment, Indianapolis providers are working together on community-wide clinical data-sharing initiatives designed to improve the quality and efficiency of care delivery. These initiatives place Indianapolis far ahead of most other communities in the use of information technology.

Other key findings of the report, Continued Hospital Expansions Raise Cost Concerns in Indianapolis, which is available online at, include:

  • National health plans have expanded their market share at the expense of some local plans and third-party administrators.
  • An employer consortium is pushing for provider performance reporting and new insurance products that reward quality and efficiency.
  • Reforms at the county hospital alleviated financial difficulties and prompted changes in the local safety net.

Indianapolis is one of 12 communities across the country tracked intensively by HSC researchers through site visits. The new report is based on a January 2005 site visit and interviews with more than 95 Indianapolis health care leaders, representing health plans, employers, hospitals, physicians and policy makers.

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The Center for Studying Health System Change is a nonpartisan policy research organization committed to providing objective and timely research on the nation’s changing health system to help inform policy makers and contribute to better health care policy. HSC, based in Washington, D.C., is funded principally by The Robert Wood Johnson Foundation and is affiliated with Mathematica Policy Research, Inc.



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The Center for Studying Health System Change Ceased operation on Dec. 31, 2013.