Hopes Dim for More Competition

Publication Date: January 2001

Publisher: Center for Studying Health System Change

Author(s): Debra A. Draper; Linda R. Brewster; Lawrence D. Brown; Carolyn A. Watts

Research Area: Health

Type: Report

Abstract:

In December 2000, a team of researchers visited Little Rock, Ark., to study that community’s health system, how it is changing and the effects of those changes on consumers. The Center for Studying Health System Change (HSC), as part of the Community Tracking Study, interviewed more than 50 leaders in the health care market. Little Rock is one of 12 communities tracked by HSC every two years through site visits and surveys. Individual community reports are published for each round of site visits. The first two site visits to Little Rock, in 1996 and 1998, provided baseline and initial trend information against which changes are tracked. The Little Rock market includes Faulkner, Lonoke, Pulaski and Saline counties.

In 1998, Little Rock health plans and providers were optimistic that partnerships with national firms would bolster their ability to challenge the powerful positions of the market's dominant health plan and provider system, Arkansas Blue Cross Blue Shield (ABCBS) and Baptist Health System. Two years later, optimism has faded as many of these would-be competitors face mounting financial and operational problems, eroding their competitive potential. The departure of various health insurers since 1998 has further constrained competition. As health care costs increase and premiums rise, many observers fear that health insurance coverage will become increasingly prohibitive for some consumers, leading to more uninsurance in the state, where nearly one in seven persons currently goes without coverage.