After several years with back-to-back, complex health care legislation, stakeholders still believe there’s work to be done while allowing for in-progress initiatives to mature.
The upcoming session will be a non-budget year in which leaders have urged their members to prioritize emergency legislation and speed—a move that would grant the 125 General Assembly members up for election more time to campaign.
Sen. Ed Charbonneau, R-Valparaiso, doesn’t anticipate the same big legislation of 2023. As the Chair of the Senate Health and Provider Services Committee, he authored, co-authored and sponsored several hefty bills, including public health funding, monitoring pharmacy benefit managers, or PBMs, and tracking prices at five prominent not-for-profit hospital systems.
“I think, too often, we come back and make changes before the original stuff we did has a chance to take hold and show whether or not we made the right decision the first time around,” Charbonneau said. “This will probably be a good session to see how we did … (and) how they play out.”
But others see the need for “constructive” changes quicker rather than later, including the very hospitals who took a hit in the 2023 session.
Brian Tabor, president of the Indiana Hospital Association, said the organization is working on a proposal to address interwoven issues related to the state’s Hospital Assessment Fee and Medicaid rates—the latter of which hospitals claim is so low they must shift costs to private insurers, thus raising prices.
“We have a lot of hospitals across the state that are struggling badly right now and we can’t wait until the budget session to bring this forward,” Tabor said.
Tabor said such moves wouldn’t require reopening the budget but would still necessitate legislation to change existing statute. However, after a $1 billion Medicaid accounting snafu earlier this week, addressing Medicaid rates will be a hard sell in 2024. But Tabor said the entity’s proposal includes a state assessment on managed care plans, which could be used to leverage federal funding and offset Medicaid costs alongside hospital expenses.
Whatever happened with the consumer database?
The Indiana Department of Insurance, or IDOI, a relatively small agency, has several big responsibilities when it comes to legislative priorities for containing growing health care costs. An agency spokesperson wouldn’t agree to an interview request and didn’t respond to an emailed list of questions provided Friday, Dec. 15.
Following 2020 legislation, the department must build out and maintain an All Payers Claims Database, or APCD, which will collect claims data from various health payer sources—including insurers, health maintenance organizations, PBMs and others—in a consumer-facing dashboard.
“… we think that it’ll be helpful to see a big picture view of all the health care and health care claims,” IDOI Commissioner Amy Beard told the interim Health Care Costs Oversight Task Force in August.
But implementing the highly anticipated dashboard has been a lengthy process and it’s uncertain how much of an impact it would have on health care costs.
IDOI tasked Onpoint Health Data in a four-year, $8.2 million contract to design and maintain the APCD, which appears to be nearing a launch date, based on a review of three meetings’ worth of materials that includes demo websites and contract data.
At the last APCD advisory board meeting in September, the IDOI presentation included previews of what the website might look like and Jonathan Handsboroough, the APCD’s executive director, reported that the majority of submitter registrations had been completed.
Also in August, during a State Budget Committee meeting, Beard detailed the fines for health payers who don’t submit claims data to the APCD.
“The civil penalty ensures appropriate accountability for reporting to the APCD and it is important to ensure that the APCD collects as much data as possible to achieve its legislative purposes, such as identifying health care needs and informing policy,” Beard told the committee. “… The department is currently working closely with health payers to ensure their knowledge of the submission requirements and procedures as part of the implementation of this new program and is optimistic that compliance with these requirements will be high.”
The proposed civil penalty will start at $100 per day, per violation for the first 30 days before increasing to $1,000 per day, per violation.
She also told committee members that IDOI had allocated $5.5 million in their budget for the APCD.
But while a Hoosier may be able to compare the cost of a hip replacement across hospitals, not everyone is convinced it’ll make a difference in bringing down prices. Charbonneau noted that employers, through company insurance policies, paid the majority of costs and Hoosiers choosing between options are likely to consider other factors.
“If I have insurance, I’m not going to pay that much attention to cost,” he said. “If I have a hospital that I have right in the area, that’s convenient … I’m going to go there.”
Consumers are less likely to travel further for a cheaper hip replacement if it’s only their employers or insurers seeing the cost savings, he said.
Tabor, a member of the APCD advisory board, said the project had potential so long as it was “truly comprehensive.” He noted that Onpoint also built Maine’s APCD and included reams of information, including prescription drugs.
“What we don’t need, I think, is another database that is only just about price,” Tabor said. “When we started this discussion in 2020, there was a thought (of), ‘We just need to have the hospital prices on there.’ We have that now; that’s available (elsewhere) …I see (the APCD) also as being a tool to not just compare price but to truly help a consumer navigate cost, quality and what can be a complex health care system.”
Still, he flagged the potential for a legal challenge, noting that federal law prohibited states from regulating certain large insurance plans and might not be able to legally compel them to submit to the APCD.
Other ongoing projects
In addition to the APCD, IDOI has at least two other legislative obligations: regulating PBMs and developing a monitoring system for prices at five nonprofit hospital systems, comparing those to a 285% Medicare rate.
For the latter, IDOI reported in August that it had issued a request for services to find a third-party vendor and hospitals were required to submit data by March 2024. By November, calculations should be finalized along with the Medicare comparison for a final report to the Health Care Cost Task Force in December.
Also at the August meeting, Beard told the committee about ongoing efforts to license PBMs and audit pharmacy claims alongside a semiannual report. Lawmakers spent a significant amount of time in the 2023 legislative session attempting to understand the costs and benefits of PBMs, ultimately landing on a reporting system to calculate claims and dictating that rebate savings be passed onto consumers.
Health care in 2025 and beyond
Tabor said he hoped that the ongoing data collection efforts would help leaders take a more nuanced and thoughtful approach to health care, even if those efforts wouldn’t all happen in 2024.
“When we get to 2025, and if we do need legislation, we can focus on legislation that empowers market-based solutions. … I think we have a lot of hospital transparency but where we don’t have (transparency) as much is how premiums are actually calculated,” Tabor said. “While I don’t like all of the policies that have been put in place in the past, I think it’s wise to take a more in-depth view of making data-based policy decisions and not lurching from session to session.”
Additional, smaller pieces of legislation for 2024 might address workforce shortages in nursing but overall not the hefty pieces of legislation from 2023.
“I think if we take a breath and we look at some of that data, we look at what’s being collected, I think we can hopefully get to more informed decisions in 2025 and beyond,” Tabor said.
Charbonneau didn’t rule out the possibility of some health care legislation, saying he was considering a bill to monitor the 340B Drug Pricing Program, which allows certain financially strapped hospitals to purchase expensive pharmaceuticals at a discount. However, Charbonneau wanted to know which hospitals used the program and whether some of the state’s serving wealthier populations were benefitting over poorer systems.
“I talked to Dr. (and Indiana U.S. Rep. Larry) Buschon about it recently. He’s been trying to deal with it at the federal level and they just haven’t been able to get much done,” Charbonneau said. “It appears that this is a well-intended program that has kind of taken on a life of its own and has gone far afield of the mission that was the intent.”
He emphasized he didn’t want to imply impropriety or any illegal happenings, just a greater scrutiny of the current program to increase transparency.
As a former hospital CEO with a business background, Charbonneau said he felt frustrated by the slow adoption of cost-saving measures on the state level when it comes to increasing quality and affordability in health care.
“Over the years, it has gotten very frustrating. We just don’t seem to be making progress in the health care area,” Charbonneau said.
He noted that the Indiana Chamber of Commerce frequently ranked the state low in terms of health care costs, which he said hurts the Indiana Economic Development Corp.’s ability to recruit companies to the Hoosier State.
“We have work to do and we’ll get there,” Charbonneau said. “But it will be painstakingly slow, it seems like. But it will work out the more attention we pay to it, the more publicity we can get. The more of our 6.8 million Hoosiers that we can educate on all of this, the better off we’ll be.”
The Indiana Capital Chronicle is an independent, not-for-profit news organization that covers state government, policy and elections.