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

By Casey Smith
Indiana Capital Chronicle

INDIANAPOLIS — Indiana hospitals are making progress toward lowering health care costs, according to new national rankings and reports.

Multiple analyses highlighted Monday, Dec. 1 by the Indiana Hospital Association showed improved hospital pricing and more cost-effective care for Hoosiers.

Recent data from WalletHub placed Indiana as the eighth-best state in the nation for health care costs in 2025, up from 15th in 2021.

The ranking was based on multiple metrics: the cost of a medical visit; average hospital expenses per inpatient day at community hospitals; the cost of a dental visit; average monthly insurance premiums; the share of the population under 65 with high out-of-pocket medical spending relative to income; and the share of adults who forgo doctor visits due to cost.

IHA officials said the improvement reflects the impact of “hospital-led” efforts to contain costs and increase efficiency across the state’s health system.

The same WalletHub rankings placed Indiana No. 20 in the country for access to health care services and 36th for health care outcomes, which included rates for infant and maternal mortality; childhood immunizations; cancer incidence; and life expectancy.

Indiana placed No. 22 in the overall “Best Health Care Systems” list.

IHA separately pointed to a 2024 Forbes report that ranked Indiana No. 24 out of 50 states in health care costs – a jump of 13 spots from its 2023 position as the 11th-highest.

Indiana was ranked the No. 10 worst state for health care in an earlier 2023 Forbes study due to a combination of high costs, poor patient outcomes and issues with overall access to care. The study emphasized a low number of primary care physicians per capita and high average insurance deductibles across Indiana, but the state received its lowest score for hospital care quality.

A different 2024 Forbes analysis ranked Indiana No. 7 worst for health care access, similarly citing high costs and lagging outcomes.

Hoosier hospital officials maintain they’ve increased price transparency and expanded tools to help patients compare costs and quality. Some of this was spurred by legislative efforts.

Further data cited by IHA shows that employer-based health insurance premiums have remained at or below the national average since 2020. The association suggested that reductions in hospital costs “are helping to keep premiums in check for families and businesses.”

RAND Corporation studies also show a “consistent” downward trend in hospital pricing, according to IHA. Indiana moved from the most expensive state in the 2019 RAND 2.0 report to ninth in last year’s RAND 5.1 analysis, surpassing eight other states in five years.

IHA leaders have previously raised concerns about RAND’s methodology but said Monday that “consistent improvement across reports points to meaningful progress.”

“Indiana hospitals are committed to making care more affordable without compromising quality,” said IHA President Scott Tittle. “These rankings reflect the hard work and collaboration happening across the state to lower costs and improve access for Hoosiers.”

“Indiana’s trajectory stands out nationally,” he continued. “We’re controlling costs better than many states and making measurable improvements relative to the rest of the country.”

Additional IHA data shows a 7% drop in the share of median income spent on health care since 2020, and national rankings now place Indiana among the ten most affordable states for health care.

The improvements come amid broader conversations at both the state and national levels about rising health care costs.

Among the numerous health care measures signed into state law earlier this year, House Enrolled Act 1004 now requires some of Indiana’s largest nonprofit hospital systems to lower prices or risk losing their nonprofit status.

Under the new law, prices for patient services must be capped at or below the level in effect on Wednesday, Jan. 1, 2025 through June 30, 2027. Lawmakers said the move aims to rein in hospital charges and increase financial accountability.

The policy also mandates audited financial reporting and gives state regulators the power to enforce price caps if hospitals exceed pre-set benchmarks.

Lawmakers also enacted House Enrolled Act 1003, which bolsters medical billing transparency across providers. The law requires hospitals and other medical providers to give clear price estimates to patients, standardize billing practices and forbids surprise fees.