Indiana Hospitals Generate $63 Billion in Economic Activity

Every year, Indiana hospitals serve approximately 640,000 inpatients and 2.6 million emergency department patients. Now, a new report from the Indiana Hospital Association (IHA) reveals the impact hospitals have — not just on patients — but on the Hoosier economy.  

According to IHA, data shows that Indiana hospitals generated more than $63 billion in annual economic activity in 2024 from jobs, wages, and spending. However, cuts to Medicaid funding by the federal government are casting a shadow over Indiana’s economic future.  

“First and foremost, Hoosiers depend on their local hospital for lifesaving care, and nothing is going to divert a hospital from that mission — as long as its doors remain open,” said IHA President Scott B. Tittle.

“While our record of service will always be a hospital’s most valuable contribution, let’s not forget about all the jobs, community investment, and spending on goods and services with local businesses that hospitals are also responsible for, all of which are now at risk by proposed cuts to hospital funding.”  

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As a major source of local employment and purchaser of goods and services, the report cited 111,520 Hoosiers who were directly employed by hospitals in Indiana plus an additional 129,028 Hoosiers whose jobs were indirectly created by the hospital industry.  

Data from the report indicated $11.8 billion was spent on hospital wages while $12.8 billion was spent by employees on everything from buying groceries and dining at restaurants to monthly car payments and home mortgages.

“Every day, the hardworking people who staff our hospitals and provide care and support to millions of Hoosiers are also the people driving Indiana’s economy,” said Tittle. “That’s why keeping our hospitals strong is essential to keeping our economy strong.”  

Threats to Indiana Hospitals and Hoosier Communities

Earlier this year, President Donald Trump signed into law the One Big Beautiful Bill Act (OBBBA), which contains drastic cuts to Medicaid that will be felt by all Hoosiers, regardless of their health insurance. 

According to the Urban Institute and Robert Wood Johnson Foundation, the expected Medicaid reductions from the OBBBA will result in $12.7 billion in cuts for Indiana hospitals over the next decade, the seventh-highest total dollar impact across the nation. Only six other states will see higher cuts than Indiana. 

Hospitals also will face even lower Medicaid reimbursement than they receive today, which is currently just 57 cents on the dollar and far below actual costs. To make up the difference, Hoosiers who have commercial insurance will likely see their rates go up in order for hospitals to cover the additional uncompensated care. 

Such drastic cuts could lead to hospitals being forced to eliminate services that patients depend on, increased wait times in emergency departments, potential layoffs, or closing facilities altogether. Unless drastic action is taken, the financial stability of Indiana’s health system is at risk, and with it, the economic health of every city and town.  

“Taking away your hospital would mean taking away the lifeline that keeps your community thriving and sustains your own quality of life,” added Tittle. “We need to work together — hospitals, policy leaders, insurance companies, and employers — to find workable solutions that protect the stability of hospitals and our economy.”