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Sen. Baldwin’s bill would bar insurers’ 10% hospital penalty; insurers say policy aims to curb costly arbitration awards
Summary
A House committee heard competing testimony on Senate Bill 189, which would ban insurers from charging hospitals a 10% administrative fee when an out‑of‑network provider treats a patient. Physicians and hospitals said the practice coerces doctors and raises patient and employer costs; Elevance Health defended its policy as a tool to reduce inflationary independent dispute resolution (IDR) awards.
Senator Baldwin urged the Indiana House committee to approve Senate Bill 189, saying the measure would prohibit a health insurer from assessing a 10% administrative fee on hospitals when an out‑of‑network provider treats a patient and would make that practice a deceptive insurance practice.
Senator Baldwin, the bill’s author, said the policy is about “profit” and warned that the 10% penalty shifts costs toward patients and strains rural hospitals. “This bill says you can’t do it. It’s not penalizing. It’s just saying you can’t do it,” he told members as he framed the legislation as protecting patients from market leverage he called unfair.
The bill drew sharply divided testimony. Brian Burdick, an attorney for the Indiana Hospital Association, described Anthem/Elevance notices to hospitals that a 10% charge would be applied if nonparticipating providers worked in a facility. Burdick said that tactic uses hospitals as leverage to force physicians into networks and that market…
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