Capacity Expands in Unrestrained Market:

Publication Date: January 1999

Publisher: Center for Studying Health System Change

Author(s): Colleen Hirshkorn; Joy M. Grossman; Loel S. Solomon; Christina A. Andrews

Research Area: Health

Type: Report

Abstract:

In September 1998, a team of researchers visited Little Rock, Ark., to study that community's health system, how it is changing and the impact of those changes on consumers. More than 40 leaders in the health care market were interviewed as part of the Community Tracking Study by the Center for Studying Health System Change (HSC) and The Lewin Group. 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 site visit to Little Rock, in September 1996, provided baseline information against which changes are being tracked. The Little Rock market includes the four-county Little Rock-North Little Rock area. In 1996, Little Rock was still a largely traditional health care market, with a surplus of facilities and services, limited health maintenance organization (HMO) enrollment and predominately fee-for-service arrangements. However, several developments - including entry of national health care firms, the creation of a state purchasing pool and new alliances between major hospitals and health plans - signaled the promise of significant change. Yet by 1998, these changes had not unfolded as expected. National firms have not usurped locals' market share, and fee-for-service continues to prevail. With few outside pressures, the alliance between the dominant insurer, Arkansas Blue Cross Blue Shield, and the largest hospital system, Baptist Health System, remains a focal point of competition.