News Release

Indianapolis Hospital Systems Compete for Well-Insured, Suburban Patients

Community Emerges Relatively Unscathed from the Great Recession

Indianapolis’ major hospital systems continue to encroach on each other’s traditional territories, engaging in a battle of bricks and mortar in suburban areas to compete for well-insured patients, according to a new Community Report released today by the Center for Studying Health System Change (HSC).

Unlike many other communities, the Indianapolis emerged relatively unscathed from the economic downturn. The region has experienced above-average population growth and lower-than-average unemployment and uninsurance rates in recent years. The financial health of businesses in the health care and life-sciences industries likely contributed to this relatively strong local economic picture.

Still, the recession took a toll, with unemployment rising more recently. And, in an effort to contain health benefit costs, employer interest in consumer-driven health plans (CDHPs)—high-deductible plans tied to a tax-advantaged savings account—remains strong.

“Compared with those in many other communities across the country, Indianapolis-area employers, including large employers, have embraced consumer-driven health plans,” said HSC President Paul B. Ginsburg, Ph.D.

In September 2010, HSC researchers visited the Indianapolis metropolitan area—Boone, Brown, Hamilton, Hancock, Hendricks, Johnson, Marion, Morgan, Putnam and Shelby counties—to study how health care is organized, financed and delivered in the community. Researchers interviewed more than 50 Indianapolis health care leaders, including representatives of major hospital systems, physician groups, insurers, employers, benefits consultants, community health centers, state and local health agencies, and others.

Indianapolis is one of 12 communities across the country tracked intensively as part of the Community Tracking Study site visits, which are jointly funded by the Robert Wood Johnson Foundation and the National Institute for Health Care Reform. HSC has been tracking these communities since 1996. Key findings of the report,Indianapolis Hospital Systems Compete for Well-Insured, Suburban Patients, available online at, include:

  • Competition among the major hospital systems continues to spur “suburbanization” of hospitals and outpatient facilities and greater hospital-physician alignment.
  • Consumer-driven health plans are growing faster in Indianapolis than in many other markets around the country.
  • The safety net remains relatively stable, with several strong, multi-site organizations serving low-income and uninsured patients, including Wishard Health Services, which won public approval of a bond issue for a new hospital.

Four hospital systems serve the market, each with a flagship hospital in or near downtown Indianapolis. Indiana University Health (IU Health), formerly Clarian Health, is the largest system, with almost 30 percent of inpatient admissions in the market across six hospitals. The second largest system is St. Vincent Health, with seven hospitals in the market. Community Health Network, with five general hospitals and one specialty heart hospital, and Franciscan St. Francis Health System with three hospitals in the market, are the next largest systems.

Historically, each hospital system occupied a separate quadrant of the metropolitan area: IU Health in the central and western part of the market, including the affluent suburb of Avon; St. Vincent in the prosperous northern area of the market, including Carmel and Fishers; Community in the east; and both Community and St. Francis in relatively less-affluent southern areas, including Beech Grove and Mooresville.

However, hospitals’ geographic service areas have blurred in the last decade asthe four hospital systems expand beyond central Indianapolis and encroach on one another’s market niches. The systems’ growth follows the migration of well-insured patients to growing, affluent suburban communities.

Anthem Blue Cross and Blue Shield has long been the dominant health plan in Indianapolis, reportedly increasing its market share in the last five years. Anthem is followed in market share by UnitedHealth Group and ADVANTAGE Health Solutions.

Consumer-driven health plans continue to grow in Indianapolis. Major private employers—notably Eli Lilly and Marsh Supermarkets—offer CDHPs exclusively. Also, public employers, including the state of Indiana and city of Indianapolis, have introduced CDHPs as an option. Approximately 85 percent of state employees are in a CDHP, while few public employers in other markets even offer CDHPs.

County-owned Wishard Health Services serves as the main safety net provider and regional provider of Level 1 trauma and burn services. Wishard and other Indianapolis safety net providers have remained relatively strong financially, allowing them to expand capacity to meet increased need for free or reduced- cost care.

Wishard, part of the Health and Hospital Corporation of Marion County, which also operates the county health department, comprises a 313-bed hospital, 13 outpatient clinics and Midtown Community Mental Health Center, the area’s major outpatient mental health provider. Following an aggressive campaign in 2009, Wishard received overwhelming public support for a $754-million bond issue to replace its aging hospital.

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The National Institute for Health Care Reform (NIHCR) is a nonpartisan, nonprofit 501(c)(3) organization created by the International Union, UAW; Chrysler Group LLC; Ford Motor Company; and General Motors. Between 2009 and 2013, NIHCR contracted with the Center for Studying Health System Change (HSC) to conduct high-quality, objective research and policy analyses of the organization, financing and delivery of health care in the United States. HSC ceased operations on Dec. 31, 2013, after merging with Mathematica Policy Research, which assumed the HSC contract to complete NIHCR projects.