IN Pulse – February 1, 2026
2026 | Issue 5 – Hospital Finance Squeeze • Rural Maternity Losses • System Expansion
Trendline Health | IN Pulse | 2026 | Issue 5
Policy & Regulation | Growth & Finance
Indiana hospitals sound alarm on razor-thin margins and looming cuts
Indiana hospitals posted a median operating margin of just 1.9% in 2025—well below the national 2.6%—with operating income dropping 5.5% ($50 million less year-over-year) despite slashing contract labor by nearly 50%. Kaufman Hall modeling warns of nearly $1 billion in annual statewide losses within 3–5 years without Medicaid rate reform and relief from surging labor, supply, and ED visit costs (up 16.8%). Leaders from Community Health Network, Methodist Hospitals, and Greene County General (which closed OB services Jan. 31) say under-reimbursement and inflation are forcing painful service cuts.
Source: Kaufman Hall - Current state of Indiana hospital finances (https://my.ihaconnect.org/Portals/0/IHA_Impact%20Report_FINAL.pdf) Parkview Health advances $200M West Lafayette hospital; rezoning clears key hurdle
Tippecanoe County Area Plan Commission unanimously approved rezoning 26.3 acres from heavy industry to medical research for a new Parkview Health hospital featuring 40 inpatient beds (expandable to 80), four ORs, two cath labs, and 153,676 sq ft of space. A resident raised staffing shortage concerns and questioned ties to the nearby SK hynix project (denied by Parkview’s attorney). The rezoning now heads to West Lafayette Common Council Feb. 2.
Goshen Health signs Letter of Intent to partner with Parkview Health
Goshen Health’s board approved a Letter of Intent to pursue a formal partnership with Parkview Health, aiming to secure long-term access to advanced technology, specialized services, and clinical resources amid rapid industry change. The move would position Goshen as Parkview’s largest hospital outside Fort Wayne and a regional hub. No immediate changes to care or staffing; due diligence and regulatory reviews expected to take 6–12 months.
Goshen Health Partnership Announcement
Workforce & Access
Indiana leads nation in rural labor & delivery closures since 2020
Indiana saw 13 rural hospital maternity unit closures since 2020—the highest in the U.S.—leaving 31 rural hospitals without L&D services in 2026 and a median 30-minute drive to the nearest delivery-capable facility. Inadequate Medicaid and commercial reimbursement plus workforce shortages drove the trend; nationally, 124 rural units closed or plan to close by end of 2026.
Source: March of Dimes
Leadership Moves
Methodist Hospitals welcomes back veteran CFO Jamie Mack
Gary-based Methodist Hospitals rehired Jamie Mack as vice president and CFO after a 20-year absence; he previously served as controller there from 1987–2006 and most recently led finance at St. Anthony Hospital in Chicago. CEO Matt Doyle called the return a boost to the system’s goal of remaining an independent, Northwest Indiana-focused safety-net provider.
Becker’s Hospital Review
Mergers & Acquisitions
Prime Healthcare continues Illinois expansion with Franciscan Health Olympia Fields
Prime Healthcare signed an asset purchase agreement to acquire 214-bed Franciscan Health Olympia Fields and its physician group from Franciscan Alliance, adding it as the ninth Illinois hospital in Prime’s portfolio following last year’s eight-hospital Ascension deal. Prime promises to preserve jobs, charity care, and key services while investing in facility upgrades and medical education; deal awaits Illinois Health Facilities and Services Review Board approval.
Business WireKaufman Hall reports 46 hospital and health system transactions announced in 2025, with activity accelerating in Q4 and expected to rise further in 2026, citing Prime Healthcare’s acquisition of Franciscan Health Olympia Fields.
Forbes
Sources: Becker’s Hospital Review, Indiana Hospital Association, Lafayette Journal & Courier, Goshen Health, Business Wire, Forbes
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