Struggling Indiana City Loses Hospital

By Consumers for Quality Care, on May 18, 2022

Franciscan Alliance, a non-profit health care system, announced it was shutting down most of a medical complex in Hammond, Indiana, according to Kaiser Health News.

The downsizing will leave Hammond with just eight hospital beds, outpatient services, and an emergency room department. A Boston University professor predicts even the emergency room will be too expensive to keep up in a decade.

Hammond has seen its population fall a third since the mid-20^th century as manufacturing jobs left. Today, the average income is $30,400 and more than a third of people live in poverty. The city’s large Black and Latino populations, as well as low-income consumers with Medicaid, currently rely on the hospital for care.

Hospital closures continue to be an issue in rural, suburban, and urban communities across the nation. In fact, hospitals in cities are more likely to serve low-income minorities who do not have private health insurance. Without the private insurance to draw from, many hospitals close or downsize, even if they are non-profit.

Today, “hospitals are operating as corporations, as moneymaking business entities, and their decisions are largely driven by financial concerns,” said Ge Bai, a professor of accounting and health policy at Johns Hopkins University. “The line between the current nonprofit hospitals and for-profit hospitals is very, very murky.” Bai’s research in 2018 found that nonprofit hospitals provided less unreimbursed Medicaid and charity care than their for-profit counterparts.

Nonprofit hospitals must do more to benefit the consumers and communities they serve, especially for the most vulnerable and low-income populations, and lawmakers must keep a watchful eye on bad hospital practices.