States are at the center of decisions on how to implement the coverage expansion initiatives of the Affordable Care Act. Some embraced the extension of Medicaid eligibility and built their own health insurance exchanges. Others have rejected the opportunity to bring coverage to low-income households and billions of federal dollars to their safety net providers. And while many credit or blame the ACA for the growth of high deductible health plans or for the growing use of limited provider networks, it seems clear that these are trends that were in progress for many years already.

Our annual market reports and data are an invaluable source of insight into twelve state health care markets. We assemble data on health plans and provider systems and weave that analysis together with the perspectives of leaders in each market. By touring our web site, you can download samples of what is in those reports and data sets.

Through our consulting research, we apply our analysis of local markets to help pharmaceutical companies, health plans, provider organizations, health purchasers, investment firms and government agencies to address the business competition and strategy issues that they face.

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  • Competitive pressures plus changes in Medicare payment are driving more consolidation for both hospitals and health plans. In Detroit, the Beaumont, Oakwood and Botsford systems closed on their merger in 2014 and began the hard work of blending three large organizations, their cultures and information systems.  The results have included much improved profitability. The entry of two for-profit companies, Vanguard Health, now part of Tenet, and Prime Healthcare in the Detroit market has resulted in more vigorous competition for a shrinking pie of hospital care. See my data and comments in HealthLeaders and in the Detroit News. Vanguard’s experience with Medicare ACOs and operating HMOs may have made it a more attractive acquisition to Tenet Health, although Tenet now plans to withdraw from the health plan business and has already sold its Detroit HMO..
  • Some systems are pursuing other strategies for extending their geographic reach, in some cases going beyond traditional local market boundaries.  In June, the Robert Wood Johnson Foundation  released my report analyzing the new generation of provider-sponsored health plans.  A follow-up blog posting in Health Affairs focuses on the joint venture strategy used by most of the recent health plan start-ups. RWJF also supported a 2015 study of hospital consolidation and strategic partnerships for provider systems in New Jersey. My New Jersey report describes how MD Anderson Cancer Center is taking these national networks to a new, higher level by opening an M.D. Anderson satellite at Cooper University Medical Center in Camden, NJ and its fourth center at Baptist Hospital in Jacksonville, FL. Memorial Sloan Kettering is also building a network of cancer centers, most recently in Miami, in partnership with the Baptist Health system there.
  • ​​​​​​New coverage options through state exchanges are transforming the individual insurance markets in different states, as new competitors arrives and insurers compete on price and networks. In Florida, for example, enrollment in HMO individual plans grew by 900,000 in 18 months. Uncertainty about subsidies for consumer cost-sharing has led some insurers to drop out or to propose large rate increases for 2018.
  • Medicaid is now the largest line of business for HMOs in many states and they enjoyed significant, profitable growth in states that expanded eligibility under the ACA. ​Recent competitive bid processes in Michigan and Minnesota almost completely shut out major contractors UCare and HAP Midwest Health Plan, but one of the successful bidders in Minnesota dropped its contract in the face of large losses.
  • Strong profits but risks for hospitals with their ambitious construction projects, seeking to expand their market share and extend their geographic reach.  Lauren Silverman’s report for NPR describes how billions are being spent on hospital construction in north Texas and quotes me: “If I were a contractor, I would wake up every morning and thank G-d for the health care business.” Peter Frost’s article in the Chicago Tribune quotes me on who bears the cost for the billions in new hospital construction underway in that region. Even as more people gain individual and Medicaid coverage, inpatient admissions are flat or falling in some states.  See my take in dBusiness on the impact of more than a billion dollars in new construction by Tenet and the other Detroit systems, even as the market for hospital services there is shrinking.

New State Market Reports for 2018

Michigan Health Market Review 2018, Part Two,  released April 4, 2019: “Michigan hospitals report improved profits, driven by continued consolidation and coverage expansions of the Affordable Care Act.” If you missed the 2018 reports, you can get special pricing on the 2019 and 2018 reports. Click here to shop.

  • Jay Greene wrote in Crain’s Detroit Business: “Report: Michigan health plans boost net income, hospital operating profits dip.” Click here to view​​

Texas Health Market Review 2018 released December 17: “Gains from insurance expansion erode and Texas hospitals and health plans see declining profits in 2017”

  • Mitchell Schnurman reported in the Dallas Morning News: “Profits R Us: Dallas-Fort Worth hospitals keep racking up the big bucks”
  • Will Maddox wrote in D Healthcare Daily: “Report: Texas Hospitals are Becoming Less Profitable”​
  • Data from the report on hospitals and health plans appears in the weekly Economic Snapshot, “Obamacare’s Impacts,” in the Dallas Morning News

Ohio Health Market Review 2018  released August 21:  “Ohio hospital report strong profits, especially in Columbus area; health insurers gain enrollees and Medicaid plans are strongly profitable”

  • Barrett Brunsman wrote in the Cincinnati Business Courier: “Income surges for Great Cincinnati hospitals.” Click here to read
  • Anna Saker wrote in the Cincinnati Enquirer: “Fewer people in Cincinnati hospitals for 2016, yet revenues rose 18%, study shows.” Click here to read

Minnesota Health Market Review 2018, Part One, released June 8: “Minnesota Health Plans Regain Profitability, Add Enrollees; New Competition Stirs for Medicare Health Plans”

  • Christopher Snowbeck wrote in the Minneapolis StarTribune: “Health Insurers Return to Profitability in Minnesota” Click here to view
  • Paul Demko wrote in Politico: “Massive financial improvement for Minnesota health plans last year.” Click here to view.
  • Chistopher Snowbeck wrote in the Minneapolis StarTribune: “Health plans lost less on Medicaid last year.” Click here to view

Michigan Health Market Review 2018Part One released April 25. “Led by Blue Cross Blue Shield Companies, Michigan Health Plans Report Record Profits and Higher Enrollment”

  • Jay Greene wrote in Crain’s Detroit Business: “Health plan enrollment, profits hit record highs.” Click here to view
  • Karen Bouffard reported in The Detroit News: “Report: HMOs, feds reshape Michigan health care.” Click here to view

Recent Presentations:

  • Goverment Financial Officers Association annual conference in St. Louis, May 7. Speaking at session “Behind the Curtain: Price Transparency in Health Care.” Click here for more information
  • Medicare Advantage Summit in Washington, DC, on May 17: Speaking at mini-summit: “Provider-Sponsored and Plan-Provider Joint Venture Medicare Advantage Plans.” Click here for more information
  • Minnesota Health Action Group Member Meeting, June 21. Speaking on “The Changing Landscape for Health Care In Minnesota: Data and Insights for Employers.” Click here for more information

​2017 Reports 

Minnesota Health Market Review 2017, Part Two, released March 27: “Net Income for Twin Cities Hospitals Drops by 19%; Health Systems Continue Growth, Consolidation and Partnership Strategies; Minnesota HMOs Regain Profits and Increase Enrollment by 8% in 2017”
  • Christopher Snowbeck wrote in the Minneapolis StarTribune: “Study: Big hospitals outside Twin Cities grow profits.” 
  • David Montgomery wrote about the 2015 report in the St. Paul Pioneer Press: “Metro hospital profits fell in 2014, while outstate earnings rose”
  • Dan Diamond wrote about the 2015 report in Poiltico Pulse: “The Mayo Clinic had a nearly 18 percent profit margin”

Florida Health Market Review 2017 was released December 13: “HMOs return to profitability and reach record enrollment numbers; Florida hospitals continue expansion strategies and enjoy strong profits” 

  • Sammy Mack reported on WLRN Public Radio: “From Patients to Hospitals, Affordable Care Act Shapes Florida Health Care Market, Analyst Says.” Click here to listen
  • Charles Elmore quotes the new report in the Palm Beach Post: “Hurricane Irma, political storms roil finish of sign-up season.” Click here to read
  • Ron Hurtibise reported in the Sun Sentinel: “Profits for Broward’s two public hospital systems going opposite ways.” Click here to read
  • Margie Manning wrote in the Tampa Bay Business Journal: “Here are the most profitable systems in Tampa Bay.” Click here to read

Colorado Health Market Review 2017 released November 16. “Colorado health system expand, are strongly profitable; Health insurers are profitable again, add members”

  • John Ingold wrote in the Denver Post: “Colorado health systems are strongly profitable; Health insurers are profitable again, add members”
  • Ed Sealover wrote in the Denver Business Journal: “Denver-area hospitals increase profits, with some reporting margins over 40%”

Wisconsin Health Market Review 2017  released October 3.

  • Lauren Anderson wrote in BizTimes.com: Milwaukee Business News: “Analyst: Profitability of southeast Wisconsin hospitals remains strong.”
  • Sean Kirkby wrote in Wisconsin Health News: “Analyst: Hospital Consolidation, National Systems Change Wisconsin Healthcare Landscape.” Click here to read.
  • Sean Kirkby wrote in Wisconsin Health News: “Analyst: Wisconsin Insurers Consolidating, Offering More Narrow Networks and High-Deductible Health Plans.” Click here to read.

To request a free sample of one of our state reports, click here

New Analysis of New Provider-Sponsored Health Plans

“Analysis of Integrated Delivery Systems and Provider-Sponsored Health Plans” published by the Robert Wood Johnson Foundation, June 2017. “Thirty-seven provider-sponsored health plans have formed since 2010 and only four were profitable in 2015.” Click here for a summary and to download the report and special data sets on more than 100 provider-sponsored health plans, old and new.

Recent Presentations:
I spoke Friday, January 20, to the monthly breakfast meeting of the Minnesota State Bar Association Health Law Section, hosted at the Mitchell Hamline School of Law Health Institute in St Paul. The topic: “Trends and Strategies for Minnesota Health Plans and Providers.” Click here to view the presentation slides

I presented on July 28, 2017 to the Minnesota Medical Group Management Association Summer Conference in Breezy Point. Click here to view the presentation slides

September 13, 2017: Presented for Minnesota Community Measurement Annual Seminar. Click here for information on MNCM. Click here to view the presentation slides

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​lllinois Health Market Review 2016 released August  25, 2016: “Health Plan Enrollment Surges, But Profits Decline; Hospital Systems Pursue Growth Strategies, But Profits Decrease by 39%”

  • Duncan Moore wrote in Crain’s Chicago Business: “Hospital and health insurers suffer in Illinois.” 
  • Lisa Schencker wrote in the Chicago Tribune: “Should Illinois hospitals have to pay property taxes? Court will weigh question”
  • Kristen Schorsch wrote in Crain’s Chicago Business: “Why for-profit hospitals here are losing”

Ohio Health Market Review 2015  released January 14:  “Consolidated hospital systems pursue expanded networks, maintain profits even with fewer inpatient days; highly profitable Medicaid enrollment surges”

Analysis of Provider System Strategies in New Jersey

“Recent Changes in Primary Care Delivery and Health Provider Systems in New Jersey” published by the Robert Wood Johnson Foundation, June 2015. “The trend toward consolidation of providers is likely to continue and the importance of the strategic alliances is likely to grow.” Click here for a summary and to download the report and special data sets on hospitals and convenient care clinics in the state. Local coverage:

  • Andrew @Kitchenman wrote in NJSpotlight: “Larger Hospital Systems Loom in New Jersey’s Future, New Report Forecasts” – with interactive maps and data sets

  • Collen O’Dea wrote in NJSpotlight: “Mapping the Location of New Jersey’s Urgent Care and Retail Clinics” – with interactive maps and data sets

  • Lisa Ward wrote in Crain’s New York Business: “New York hospitals cast an acquisitive eye toward New Jersey; Wave of mergers shifts market across the Hudson.” 

“The Big Picture V: New York’s Private and Public Insurance Markets, 2012”, released May 7, 2014. “Insurance plans specializing in public programs were fastest growing.” See the summary here and download the PDF here. 

Reports and data sets now available for these states:

Want to see a sample market study? Several reports are available for free PDF download. Follow the links for:

We hope you will visit this site frequently. We will regularly add information about new reports as they are released. In addition, our Industry News section will put breaking news into the context that you need. Please contact us if you have questions or comments. To reach us send E-mail to: Baumg010@tc.umn.edu

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Allan Baumgarten
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