Committtee considers anti-monopoly bill for health care entities

The committee passed four other bills on Tuesday related to mammograms, dentistry, mental health services and more.

By: - January 17, 2024 6:15 am

The House Public Health Committee listens to testimony on Jan. 16, 2024 related to ownership transparency and pharmacy benefit managers. (Whitney Downard/Indiana Capital Chronicle)

The House Public Health Committee had a busy Tuesday morning, unanimously advancing four bills related to mammograms, dentistry, mental health services and the Indiana Department of Health. 

But the largest and most wide-ranging bill wasn’t called for a vote, with Rep. Brad Barrett, the committee’s chair, saying he wanted to hold the bill to allow for committee amendments before their meeting next week.

Testimony on the insurance transparency and hospital ownership bill drew mixed reviews, with some concerns about regulations for pharmacy benefit managers. 

Bill author Rep. Donna Schaibley, R-Carmel, welcomed more ideas as the bill travels through the process. 

“We’re open for discussion and please reach out,” she said. 

Bill details

The bill borrows much of its contents from ongoing interim task force discussions to reduce the state’s health care costs, particularly by addressing the monopolization of health care entities and allowing employers and other health insurance sponsors to audit health claims data for no fee.

As Schaibley detailed, the health department would be tasked with creating a database of ownership information for Indiana’s health care entities, which includes hospitals, physician group plans, third party administrators, insurers and pharmacy benefit managers. The bill includes non-compliance penalties.

Health care costs target of state policy proposals

“Consolidation was a major topic of the task force. Hospitals and insurers are buying practices, which is causing consolidation. There are so many studies that are showing that consolidation increases prices,” Schaibley said. “There’s also concerns (with) private equity groups…”

Private equity groups, for-profit investment organizations that traditionally overtake a business for a short time to restructure it and resell at a profit, have grown in recent years after such entities devastated local media outlets, fisheries and long-term care providers, as detailed by ProPublica. 

Schaibley shared a study from the Journal of American Medicine that reported a 25% increase in adverse events after a private equity acquisition. The influence of private equity in Indiana’s health care landscape is unknown.

Elsewhere in the bill, pharmacy benefit managers (PBMs) and third party administrators (TPAs) couldn’t bar contract holders — employers who offer insurance plans, health plans, Medicaid or managed care organizations — from requesting audits of health claims once a quarter and couldn’t charge for the service. 

Gloria Sachdev, the president and CEO of the Employers’ Forum of Indiana, testifies on Jan. 16, 2024 before the House Public Health Committee. (Whitney Downard/Indiana Capital Chronicle)

The above portions of the bill were applauded by various employers’ groups, including the Indiana Manufacturers Association. 

“How our members, the employers, interact with the third party administrators, the brokers and the insurance companies is a critical part of the whole dynamic,” said Andrew Berger, the senior vice president and lobbyist for the organization. 

Certain other fees imposed by those PBMs and TPAs, such as those for waiving bundled services, are also prohibited but attracted more consternation. 

Rep. Martin Carbaugh, R-Fort Wayne, noted that streaming services frequently include similar fees for waiving bundled program offerings.

“Saying that a PBM can’t do that — I don’t love that,” Carbaugh said. “… even if we went through and did this … if I’m a PBM, I just raise the price of everything and make it so you don’t have a choice. You buy all of the services or you don’t have any services.”

Joey Fox, on behalf of the Pharmaceutical Care Management Association, the national trade group for PBMs, also noted worries about the inclusion of ERISA plans, or health plans that fall under the federal Employee Retirement Income Security Act of 1974. Such plans have been difficult for legislators to regulate in the past, due to federal prohibitions.

“We believe it’s important to … have clear and uniform health plans (for ERISA) across the country,” Fox said. 

He noted that roughly 44 of the nation’s 66 PBMs operate in Indiana, meaning there is plenty of competition in the space when it came to fees.

Other bills in Public Health

Barrett, R-Richmond, also heard testimony on his agency bill for the Indiana Department of Health, which addressed several provisions related to home health care, food temperature management and the eviction process for long-term care facilities. 

Rachel Swartwood, the agency’s legislative director, explained that current law barred individuals convicted of certain crimes from working in long-term care facilities but not from home health care. The aims to prohibit those convicted from home health as well. 

See the full committee bill list here.

Additional bill provisions include: uniform temperature control guidelines for food preparation, allowing the Family and Social Services Administration to share mental health records with the health department’s child fatality review teams and using administrative law judges for the eviction process. 

“The Department of Health already uses (the administrative law) process. We use it through a memorandum of understanding … but we want to codify this as we’re going through an administrative change,” Swartwood said. “We have about 80 cases a year that go through this process.”

Lawmakers also passed two amended bills, one requiring more health care guidance to people with dense breast tissue, a dental licensing compact and another requiring the state to foot the bill for Hoosiers involuntarily committed to mental health facilities. 

The latter, House Bill 1216, builds on previous work from author Rep. Greg Steuerwald, R-Avon, to reform the state’s mental health services. Jails and prisons are some of the state’s largest mental health providers and a bill he authored last year to ease payment for such services at the facility level for Hoosiers who aren’t incarcerated. 

Rep. Greg Steuerwald, R-Avon. (Photo from Indiana Senate Republicans)

“The intent here, just like (House Enrolled Act 1006) last year, is to ensure payment for services provided,” Steuerwald told the committee. 

Steuerwald said the bill’s aim was to continue providing care to people even after their discharge by guaranteeing payment for services. 

“They’re either going to be on the streets without mitigation or they’re going to be in jail. We’re going to pay for this one way or another,” Steuerwald said. “… The intent of 1006 was to enhance the facility’s willingness to keep these people under a court order and to treat them.”

Additionally, the bill would allow doctors overseeing intake to consider the testimony of friends and family members before signing off on an involuntary commitment. 

Beth Keeney, the president and CEO of LifeSpring Health Systems, said that expansion of information was crucial for community mental health centers like hers. She shared the story of a parent seeking help for their adult child, who was unaware of the severity of their mental illness.

She said she had to refer the parent to the police because the person wasn’t an established patient or someone the doctors had screened.

“Law enforcement advised the parent that until they became sicker or caused a problem that required their intervention that they were not able to help either. So unfortunately, my advice to a scared scared parent of a very sick child was wait until your kid gets sicker,” Keeney said. “Now, happily, the situation was resolved and this child was able to get access to care but there have been additional scenarios across the state with much worse outcomes.”

The bill passed the committee unanimously.

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Whitney Downard
Whitney Downard

A native of upstate New York, Whitney previously covered statehouse politics for CNHI’s nine Indiana papers, focusing on long-term healthcare facilities and local government. Prior to her foray into Indiana politics, she worked as a general assignment reporter for The Meridian Star in Meridian, Mississippi. Whitney is a graduate of St. Bonaventure University (#GoBonnies!), a community theater enthusiast and cat mom.

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