MADISON, Wisconsin, October 13, 2026 — Wisconsin’s hospital markets are highly concentrated, and
they grew more concentrated between 2018 and 2025, driven mainly by hospital mergers and closures rather
than by patients choosing different hospitals. That is the central finding of a new report from the Center for
Research on the Wisconsin Economy (CROWE) that measures market concentration for every general
acute-care hospital in the state over 32 quarters and roughly 4.2 million inpatient discharges, including all
payers.
The new report, “Hospital Market Concentration in Wisconsin, 2018–2025: Evidence from Hospital
Discharge Data,” by Ike Brannon of the Jack Kemp Foundation and Anthony T. Lo Sasso, the Robert F.
and Sylvia T. Wagner Professor of Public Affairs at the University of Wisconsin–Madison’s La Follette
School of Public Affairs, follows the authors’ August CROWE report, “Hospital Prices in Wisconsin and
Illinois: A Cross-State Comparison,” which found Wisconsin inpatient prices roughly 25 percent above
those in neighboring Illinois.
That price gap motivated the new study. A large body of research finds that hospital consolidation raises
prices for commercially insured patients by strengthening hospitals’ bargaining position with insurers. If
Wisconsin’s prices are high, its hospital markets should be concentrated at the level where hospitals and
insurers bargain. The new report tests that proposition.
The report’s starting point is that hospitals compete for patients within regions, not across the state as a
whole; patients in Wausau rarely travel to Milwaukee for inpatient care. Measured where competition
actually happens, seven of Wisconsin’s eight regional markets are highly concentrated, and every one of
them became more concentrated over the past eight years.
Already concentrated markets became more concentrated
The report measures concentration with the Herfindahl–Hirschman Index (HHI), the standard tool federal
antitrust agencies use to assess mergers. Under the 2023 federal Merger Guidelines, a market with an HHI
above 1,800 is considered highly concentrated. The report’s primary market definition is the Hospital
Referral Region, the broadest regional definition in common use and therefore the most conservative choice;
every narrower definition yields higher measured concentration.
Among the report’s findings:
- Across Wisconsin’s eight referral regions, the patient-weighted mean HHI rose from 2,520 in 2018
to 2,857 in 2025, well above the 1,800 threshold. Seven of the eight regions are highly concentrated.
The most concentrated are Wausau (5,702), La Crosse (4,202), and Appleton (3,826).- - Madison is the only region below the threshold, at 1,726, and only because UW Health and
UnityPoint Health–Meriter are counted as separate firms despite the joint operating agreement they
have shared since 2017. Counted as one firm, Madison’s HHI rises to 2,710, and all eight regions are
highly concentrated.- - Ownership change accounts for 58 percent of the rise in concentration; patients moving between
hospitals accounts for 42 percent. In Wausau, where Aspirus acquired seven Ascension hospitals,
ownership change explains nearly the entire increase. - The largest single increase came from one transaction. Ascension’s 2021 sale of seven hospitals to
Aspirus raised the Wausau region’s HHI by 1,656 points, to 5,489, and the Marshfield region’s by
282. Aspirus now accounts for 72 percent of inpatient discharges among Wausau-region residents. - Closures matter as much as mergers. The single largest change in the Marshfield region was not a
merger: the March 2024 closure of two Hospital Sisters Health System hospitals in Eau Claire and
Chippewa Falls raised the region’s HHI by 540 points. - Concentration is higher under every narrower market definition: 3,439 by metropolitan area, 3,753
by county, and 4,080 by hospital service area.
The authors note that market exit raises concentration just as a merger does, and that any analysis that looks
only at transactions misses it. In the Chippewa Valley, the exiting system’s patients did not leave the
market; they went to the two systems that remained.
No merger drew a public challenge
The report documents thirteen transactions affecting Wisconsin general acute-care hospitals between 2018
and 2025, including the Aspirus–Ascension sale and the January 2024 Froedtert–ThedaCare merger, which
raised concentration in the Appleton region by 365 points and in the Neenah region by 230. The authors
found no record that the Federal Trade Commission, the U.S. Department of Justice, or the Wisconsin
Attorney General sued to block, conditioned, or publicly objected to any of them.
Wisconsin has had no certificate-of-need review of hospitals since the mid-1990s and, unlike Illinois,
Minnesota, and a dozen other states, requires no advance notice of health care transactions. Federal and state
enforcers have gone to court to stop hospital mergers in Illinois three times since 1989, and Illinois has
required advance notice of health care transactions since 2024.
More concentrated than Illinois, but concentration is not the whole story
Using Medicare discharge data that cover both states on an identical basis, the report finds Wisconsin’s
referral regions average an HHI of 2,832 in 2025, against 2,427 in Illinois. But the comparison turns on Chicago. The eight Chicago-area referral regions average 2,051, while the rest of Illinois averages 3,343,
more concentrated than Wisconsin.
Because the authors’ earlier price study found Wisconsin’s price premium was broad and not driven by the
Chicago market, the report cautions against attributing the Wisconsin–Illinois price gap to local hospital
concentration alone.
Wisconsin is more concentrated than Illinois, but that difference is driven primarily by the Chicago market;
the rest of Illinois is at least as concentrated as Wisconsin. Together with the large price differences
documented in the earlier report, the authors conclude that more is going on in the Wisconsin health care
market than hospital concentration alone.
One candidate is the insurance side of the market. Health plans owned by Wisconsin hospital systems held
36 percent of the state’s fully insured commercial enrollment in 2024, rising to 51 percent when Dean
Health Plan, in which SSM Health holds a 45 percent stake, is included. The corresponding figures are
about 5 percent in Illinois and 7 percent nationally. A hospital-owned insurer, the authors note, has little
reason to bargain hard with its parent or to push rival hospitals’ prices down.
What the report does and does not measure
The report is descriptive. It measures market structure directly from Wisconsin Hospital Association
inpatient discharge records, which report charges rather than negotiated prices, and it treats the link to prices
as a matter of inference from the research literature and the authors’ earlier work. It covers inpatient care
only and does not measure outpatient care, ambulatory surgery centers, or physician markets. The authors
stress that treating the state as a single market, which yields an HHI of just 1,103, says little about the
markets in which hospitals actually compete.
The report concludes that Wisconsin’s local hospital markets are concentrated by any standard measure, and
that they became more so through a sequence of documented transactions and closures rather than through
shifting patient preference alone. None of those transactions drew a public challenge from federal or state
antitrust enforcers.
Read the full report: Hospital Market Concentration in Wisconsin, 2018–2025: Evidence from Hospital
Discharge Data.
Read the earlier report: Hospital Prices in Wisconsin and Illinois: A Cross-State Comparison.
