Indy Standard

State Representative Martin Carbaugh has proposed a bill aimed at reducing health care costs by ensuring nonprofit hospitals in Indiana operate with a focus on affordability. The bill, which recently passed the House Public Health Committee, targets excessive pricing and seeks to increase transparency.

According to data, profit margins for the "big six" nonprofit hospital networks in Indiana have ranged from 9-17 percent since 2017, compared to a national average of 3 percent. Carbaugh's legislation intends to address these discrepancies by implementing stricter pricing regulations for nonprofit hospitals.

House Bill 1004 proposes penalties for nonprofit hospitals that charge facility fees exceeding 265 percent of Medicare rates. Additionally, it stipulates that these hospitals should not charge more than 300 percent of Medicare reimbursement rates if they wish to maintain their nonprofit status. The aim is to ensure that such institutions prioritize community benefits over profits.

"Health care costs remain high in Indiana and studies show that some of the hospitals driving this issue are large, nonprofit hospitals," Carbaugh stated. "House Bill 1004 will put stronger parameters in place to hold these hospitals accountable and save Hoosiers real money on their health care costs."

The bill also includes an excise tax phased over three years and mandates annual reporting and audits for compliance. Nonprofit hospitals would need to submit detailed reports comparing billed items with Medicare rates and could lose their status if found charging excessively.

Furthermore, the legislation requires nonprofit hospitals to undergo annual audits by the Indiana Department of Insurance and submit necessary tax documents by August each year for public access on the state legislature's website.

House Bill 1004 now awaits further deliberation in the full House. More information can be accessed at iga.in.gov.