Bloomington-based Indiana University Health's five-year price freeze isn't enough to get its prices to national averages, Michael Hicks, director of the Center for Business and Economics Research, wrote Jan. 9 in the Star Press.
IU Health announced the plan in December 2021, stating that it will save consumers more than $1 billion. From 2016-18, the system's prices were 33 percent higher than the national average, a 2020 Rand study found.
The organization received $1.2 billion in profits in 2020, Mr. Hicks said. He estimated that it'll take more than 12 years of freezing prices to bring it to the national level and that the system could freeze prices for 40 years before going through its $9 billion in accrued profits.
"The simple truth is that the IU Health price freeze is a public relations gimmick that will have no noticeable effect on the lives or finances of Hoosiers," he wrote. "But the notion that IU Health would spend $1 billion over five years on a public relations gimmick illustrates the deep legal and legislative challenges it anticipates. The firm is right to be worried."
IU Health did not respond to a request for comment by the time of publication.
Read more here.