Indianapolis, Indiana – Recent legislative developments in Indiana are addressing several critical healthcare issues, with a particular focus on vertical integration, pharmacy benefit managers (PBMs), and transparency in healthcare processes. Last week, the House Insurance Committee considered two key measures aimed at improving healthcare access and affordability, though both bills will undergo further review before they move forward.
One of the bills, Senate Bill 140, introduced by Senator Ed Charbonneau (R-Valparaiso), targets the practice of vertical integration within the pharmaceutical industry, specifically focusing on PBMs. This legislation seeks to introduce prohibitions against PBMs owning pharmacies or contracting with affiliated health plans. The goal is to separate these entities to avoid potential conflicts of interest that may affect pricing and access to medications.
However, the bill has sparked opposition from the Chamber of Commerce, which argues that such ownership restrictions could force PBMs to either divest or exit the Indiana market. According to the Chamber, this could reduce competition and limit options for employers and consumers, thereby increasing costs and decreasing the leverage needed to manage healthcare expenditures. Additionally, the Chamber takes issue with restrictions that prevent health plans from incentivizing mail order or specialty pharmacies, which have been shown to reduce medication costs.
While the Chamber supports provisions that mandate adequate reimbursement for pharmacies, it remains concerned about the imposition of a new professional dispensing fee of $10.48 per prescription. The Chamber warns that such fees could lead to higher costs for both employers and consumers, counteracting efforts to control healthcare expenses.
Another significant piece of legislation under consideration is Senate Bill 480, introduced by Senator Tyler Johnson (R-Leo). This bill primarily addresses the issue of prior authorization in health insurance plans. Prior authorization has long been a contentious issue, with patients and healthcare providers often expressing frustration over delays in obtaining necessary treatments or medications due to administrative hurdles.
Senate Bill 480 proposes transparency measures requiring health insurance companies to publish their authorization criteria and provider statistics online. This move is widely seen as a positive step toward improving accountability and transparency in the insurance approval process. By making these criteria publicly available, the bill aims to streamline the prior authorization process and make it more predictable for both providers and patients.
However, some concerns remain. While the transparency measures are supported, there are reservations regarding the bill’s compressed review deadlines and the introduction of automatic approvals. Critics argue that these provisions could unintentionally undermine proper clinical review, potentially leading to inadequate or inappropriate approvals that could compromise patient care.
Rep. Martin Carbaugh (R-Fort Wayne), Chairman of the House Insurance Committee, announced that both bills would be held for further consideration, signaling that there is still much work to be done before these measures become law. For now, the focus remains on refining the proposals to ensure they achieve the intended goals of reducing costs, increasing transparency, and improving access to care for Hoosiers.
As these discussions continue, healthcare professionals, patients, and lawmakers alike will be watching closely to see how these proposed reforms shape the future of healthcare in Indiana.
