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Indiana asks insurers, hospitals to find ways to reduce healthcare prices

por John R. Fischer, Senior Reporter | February 03, 2022
Business Affairs Insurance

Recently, the state’s largest healthcare system, Indiana University Health, announced plans to freeze prices to align them with the national average in three years. The state has also passed legislation to create an all-payers claims database and a bill that requires hospitals and insurers to hold a public forum once a year to discuss pricing.

Business owners have complained about high costs and the impact on their businesses. This includes numerous acquisitions carried out by hospitals of physician practices, as such activity hinders competition, they say. They also have criticized the nonprofit status of hospitals, which allows them to avoid paying taxes and makes them unaccountable to potential stakeholders, according to the IndyStar.

“I do think the General Assembly gets it and to some degree, the evidence is so overwhelming that it’s really difficult for the healthcare industry not to participate with this,” said Michael Hicks, director of the Center for Business and Economic Research. “It is the most monopolized industry other than utilities.”
Talks of forming a working group to address system inefficiency are being discussed. Additionally, the all-payers claims database is expected to provide better comparison of Indiana costs to those of other states with similar databases, says Tabor.

He suggests that hospitals work with insurers to reduce administrative costs but says any decrease will require help from legislators. "While we applaud the legislative leaders for wanting to be aggressive about this, they need to recognize there’s a third party in all of this and that is the legislature itself. Ultimately when April 1 hits, can they [the legislative leaders] step back and say maybe we don’t have all of the answers that we’re looking for, but we have some and can we continue working as three partners on this.”

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