,,Market Concentration Increases but Power Held in Check:

Market Concentration Increases but Power Held in Check:


Publication Date: January 1999

Publisher: Center for Studying Health System Change

Author(s): Caroline Rossi Steinberg; Paul B. Ginsburg; June Eichner

Research Area: Health

Type: Report

Coverage: Michigan


In October 1998, a team of researchers visited Lansing, Mich., 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. Lansing 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 Lansing, in October 1996, provided baseline information against which changes are tracked. The Lansing market includes Ingham, Clinton and Eaton counties.

The Lansing health care market has long been highly concentrated, and has become even more so over the past two years. Mergers have left only two hospital systems serving the community, and the exit of a health plan reinforced the strength of the remaining two plans. These few organizations, along with the community's three large local employers, share a balance of power, while unions and a strong local health department provide a check on their influence.

In 1996, there was tension among these major actors. Purchasers were exerting pressure to lower health care costs, and a proposed merger of a local hospital with Columbia/HCA was widely divisive.