Indiana Joins States Moving to Review Healthcare Merger Activity
State governments across the country are setting up ways to review healthcare mergers and acquisitions. In the latest example, Indiana Governor Eric J. Holcomb recently signed a bill into law that will require notification to the state of healthcare entity mergers and acquisitions.
In 2022, the State of Oregon launched a Health Care Market Oversight (HCMO) program to review business deals that consolidate the health system in a way that could impacts, costs, quality, access and equity for Oregonians. Most physicians in the Portland metro area work for health systems. Through the program, local communities and the state will review proposed business deals to make sure they will help – and not hurt – Oregon's shared goals of health equity, lower consumer costs, increased access, and better care.
The Minnesota Legislature passed a law that would require a state review of some proposed mergers of hospitals or healthcare systems – and allow them to be blocked if they are deemed detrimental to the public or would lead to reduced health outcomes for Minnesotans
The Indiana measure, effective July 1, 2024, adds a new Chapter 8.5 to the Indiana Code providing in Section 4(a) that “[a]n Indiana health care entity that is involved in a merger or acquisition with another health care entity with total assets, including combined entities and holdings, of at least ten million dollars ($10,000,000) shall, at least ninety (90) days prior to the merger or acquisition, provide written notice of the merger or acquisition to the office of the attorney general in a manner prescribed by the office of the attorney general.”
State Sen. Chris Garten (R-Charlestown), who authored the bill, said that the bill would promote competition in Indiana's healthcare system to help lower costs for Hoosiers.
"Hoosiers spend too much of their hard-earned money on healthcare, partially because of a lack of market competition in our healthcare space," said Garten in a statement. "Senate Enrolled Act 9 would improve transparency on healthcare mergers and acquisitions so our state can take necessary steps to consider what impact these business deals could have on Hoosiers' access to affordable healthcare services."
The act is a direct result of recommendations the Health Care Cost Oversight Task Force made during the 2023 interim. The task force, which Garten chaired, studied reasons why Hoosiers continue to pay among the highest healthcare costs in the nation. Testimony during task force meetings highlighted the role market consolidation plays in driving up healthcare costs.
The bill is also a product of healthcare stakeholders’ work to create a merger review policy for Indiana that allows the state to monitor potential antitrust issues.
