Appropriations committee advances Medicaid overhaul, PBM transparency and prior-authorization changes; 17 bills move forward

The Indiana Senate Appropriations Committee on Oct. 12 amended and advanced a slate of bills that included a major Medicaid reform measure, a pharmacy benefit manager transparency bill, and legislation to streamline health-care prior authorization, along with agency and policy updates across education, economic development and public safety.

The committee’s session prioritized Senate Bill 2, a bill that would move parts of Indiana’s Medicaid expansion out of the state plan into a federal waiver the bill’s sponsors call “HIP 3,” add work and volunteer requirements for certain adults, and set an enrollment cap. The committee also passed Senator Charbonneau’s SB 140 on pharmacy benefit manager (PBM) transparency and Senator Johnson’s SB 480, which narrows some prior-authorization burdens on clinicians and patients. In all, the panel advanced roughly 17 bills by voice or roll call votes; vote tallies are listed in the Votes-at-a-glance section below.

Why it matters: The Medicaid changes could change who is eligible for certain programs and how the state manages growth; PBM and prior-authorization bills target drug-pricing and administrative barriers that lawmakers said drive costs and delay care. Lawmakers debated trade-offs between cost containment and access, and several senators warned the changes could increase administrative burdens or shift costs to other parts of the system.

Senate Bill 2 — Medicaid changes and HIP 3 waiver intent

Senate Bill 2 drew the longest debate. Sponsor remarks and subsequent questioning showed the amendment’s intent: require the Family and Social Services Administration (FSSA) to report on how the state and federal governments enforce Medicaid eligibility rules (including a request for a look-back study), to remove a 36-month time limit in one program section, and to codify legislative intent that the FSSA seek federal approval to move parts of the Medicaid expansion into a waiver program the sponsors refer to as “HIP 3.”

Sponsor Senator Brown said the…