Lansing's Calm Health Care Market Belies Increased Competition, Economic Doldrums

Originally published by the Center for Studying Health System Change (HSC) as a Community Report, 2005.

Lansing's Calm Health Care Market Masks Growing Competition

HSC researchers visited Lansing, Michigan, as part of the Community Tracking Study and found a health care market whose outward calm belied increasing competition among providers and the strain of ongoing economic difficulties. Lansing's economy, heavily dependent on state government and the auto industry, continued to face challenges that affected both the demand for health care services and the financial sustainability of local providers.

Beneath the surface of this relatively stable market, competition between the two major hospital systems was intensifying as both sought to attract and retain physicians, expand their service offerings, and capture a greater share of well-insured patients. The economic doldrums affecting Michigan's manufacturing sector were contributing to erosion of employer-sponsored insurance coverage, putting additional pressure on providers who depended on commercially insured patients for financial margins. Health plans operated in a market where provider consolidation limited their bargaining leverage, and employers had few alternatives for containing health benefit costs beyond increasing employee cost sharing.

Sources and Further Reading

Center for Studying Health System Change, "Lansing's Calm Health Care Market Belies Increased Competition, Economic Doldrums," Community Report, Community Tracking Study (2005).