House Bill 1004, signed by Gov. Mike Braun on Tuesday, May 6, puts a limit on nonprofit hospital prices. Photo by Nick Youngson, Pix4free.

News Release

INDIANAPOLIS — Gov. Mike Braun signed a bill into law that strips Indiana’s nonprofit hospital systems of their status if aggregated charges overtook state average prices Tuesday, May 6.

Authored by Fort Wayne Rep. Martin Carbaugh, House Bill 1004 was originally concerned with just hospital prices. As it wound its way through the General Assembly, the bill’s scope widened to include other insurance and healthcare topics.

Its key measures target hospital systems with $2 billion or above in state net patient revenue. This affects the “Big Five’ of Indiana’s nonprofit hospitals: Parkview Health in Fort Wayne, Franciscan Health in Mishawaka, Indiana University Heath, Ascension St. Vincent and Community Health Network in Indianapolis.

The bill’s supporters point to a recently-updated study by Los Angeles-based research group Rand Corp., which found Indiana had the nation’s ninth-largest hospital costs.

HB 1004 determines if prices are excessive using state averages. Older versions of the legislation uses percentages of Medicare reimbursement as benchmarks. Under the bill, state nonprofit hospitals will lose their status if out- and inpatient aggregate average prices match or exceed the state average. Hospitals that have lost their status can regain it by dropping their prices to compliant levels.

The Indiana Office of Management and Budget is also required to conduct a study of out- and inpatient prices in 2023 and 23, which will set the state average reported as a percentage of Medicare reimbursement.

Finally, nonprofit hospitals will provide the state with its Internal Revenue Service Schedule H — Form 990 — each year on Oct. 1, which details the hospitals operation and benefit to its community. Every day these forms are late, hospitals will face a $10,000 fee. Health insurers and third-party administrators, meanwhile, are tasked with providing additional financial and plan information.