FRANKLIN — Families in Johnson County will no longer be able to access obstetrics services at Johnson Memorial Health, after the hospital announced it will close its maternal care center. It marks the latest hospital in the state to cut its maternity care services due to budget concerns.
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Since 1942, JMH has helped bring thousands of babies into the world. However, they're losing millions of dollars a year providing these kinds of services. Hospital officials say that loss is what led to this heartbreaking decision.
“It is heartbreaking to hear the comments from our patients saying, 'We’ve had three generations of our family born in this hospital, and now we can’t have our baby here,'" Brenda Reetz, CEO of Greene County General Hospital, said.
“We can’t continue to be asked to do more with less," Dr. David Dunkle, President and CEO of JMH, stated.
In the coming months, all maternity care services will be phased out of the hospital.
“We have tried to hold on as long as we could," Dunkle said. "But we can’t just continue to lose money delivering babies.”
The hospital said the decision stems from low insurance reimbursement rates and rising costs of service.
“Unfortunately, we can’t provide the care that we want when it's 57 cents on the dollar for Medicaid... and then you throw in the fact that federal Medicare reimburses about 82 cents on the dollar," Dunkle explained. "At Johnson Memorial Health, that’s 70% of our business.”
He called it unsustainable and said private insurance companies only add to the problem.
“We’re getting paid less than ever by the commercial payers," Dunkle stated. "Not paying us in a timely manner, denying care, clawing back payments.”
“Those are the challenges we’re up against," Reetz said. "And now these are the consequences of what those payers are doing to us.”
According to the Indiana Hospital Association, in the past 10 years, nine Indiana hospitals have closed, including four since just 2022. But even hospitals that have stayed open have had to scale back services. Since 2020, 15 have closed their obstetrics department. JMH marks number 16.
Most recently, Greene County General Hospital closed the doors on its OB department at the end of January.
“We get paid $6,000 per vaginal delivery, and we get paid $13,000 per C-section. We deliver 70 babies a year," Reetz shared. "The cost of the physicians only, only the physicians alone, because we have to use contract labor, is about $1.7 million to cover a 24/7 OB unit. It doesn’t take very much math skills to realize that those numbers don’t break even.”
Now, rural hospitals like these in Greene and Johnson counties are concerned about future care.
“We’re going to continue to see cuts like this throughout the state," Reetz emphasized.
“If things don’t change, hospitals like Johnson Memorial Health will cease to exist," Dunkle said.
JMH said 48 staffers with the Maternity Care Center will lose their jobs as part of its closure. It hasn’t finalized an exact closing date yet, but Dunkle said they're working on a transition plan to help patients find care elsewhere.
Along with the maternity care center, the hospital is also closing a satellite pediatric office in Greenwood. Dunkle said no other services are at risk of closing at this time.
WRTV reached out to the Indiana Hospital Association for their thoughts on the closure. Scott Tittle, president of the Indiana Hospital Association, sent us the following statement:
Indiana’s low Medicaid rates—covering only 57 cents on the dollar of what it costs to treat patients on average—leave hospitals across the state struggling financially, with nearly $2.7 billion in unpaid health care costs every year. This reality has forced some hospitals like Johnson Memorial Health to make difficult decisions to eliminate services in order to remain financially viable and continue serving the community as a whole.
With this latest announcement, 12 birthing units in Indiana will have closed in just the past three years because inadequate Medicaid reimbursement has contributed to hospitals being unable to continue offering the maternity and OB services Hoosier women and families depend on.
Without meaningful action, Medicaid reimbursement for Indiana hospitals will continue to decline over the next several years due to a projected $12.7 billion in Medicaid cuts tied to the One Big Beautiful Bill Act. These trends threaten the stability of our health care system and will lead to even more closures if left unaddressed.
Indiana hospitals remain committed to protecting access to care and serving the health needs of all Hoosiers—but we cannot do it alone. Reimbursement reform is urgently needed to ensure hospitals can keep their doors open and maintain critical services for every community in our state.
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Casey Zanowic is the In Your Community reporter for North Side Indy. She joined WRTV in July of 2025. Casey has a passion for storytelling and is ready to showcase impactful stories that make a difference in her community. Share your story ideas and important issues with Casey by emailing her at casey.zanowic@wrtv.com.
