Insurers Consolidate, Hospitals Struggle Financially

Publication Date: January 2001

Publisher: Center for Studying Health System Change

Author(s): Aaron Katz; Robert E. Hurley; Leslie A. Jackson; Timothy K. Lake

Research Area: Health

Type: Report

Coverage: New York

Abstract:

In October 2000, a team of researchers visited Syracuse, N.Y., 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 60 leaders in the health care market. Syracuse 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 Syracuse, in 1996 and 1998, provided baseline and initial trend information against which changes are tracked. The Syracuse market includes Cayuga, Madison, Onondaga and Oswego counties. After a flurry of competitive maneuvering in 1997-1998 in anticipation of managed care growth, the Syracuse health care market has settled into an uneasy calm, as consolidation among local insurers has muted concerns that aggressive managed care will take hold. Indeed, a series of health plan exits and mergers have left indemnity insurer Excellus Blue Cross Blue Shield with about 40 percent of the Syracuse market, which has produced a new stabilizing force in the local market. Nevertheless, hospitals have struggled financially in face of reduced payment rates, operational problems and long-term debt.