A bill designed to bring down healthcare costs in Indiana has successfully passed through the Health Committee, marking a critical step in the legislative process. If enacted, the proposal could force the state’s largest nonprofit hospitals to significantly lower prices—or risk losing their nonprofit status.

What HB1004 Means for Healthcare Costs

House Bill 1004 sets ambitious targets for Indiana’s healthcare system. It calls for the state’s five largest nonprofit hospitals to cut their prices by as much as 40%. If they fail to comply, they could face the loss of nonprofit status and the financial benefits that come with it.

Bill co-author Rep. Ben Smaltz (R-Auburn) has made it clear that the measure isn’t about targeting hospital systems. “This is about people,” Smaltz said. His argument is that Hoosiers are being burdened by excessive healthcare costs, and this bill aims to make care more affordable.

Why the Bill Matters

The push for lower healthcare costs comes amid growing concerns over Indiana’s hospital prices, which are among the highest in the nation. According to a study from the RAND Corporation, Indiana ranks among the top states for hospital costs relative to Medicare reimbursement rates.

If the bill becomes law, hospitals will have two options:

• Lower their prices to meet the state’s cost reduction goals.
• Maintain current pricing and risk losing nonprofit tax benefits.

For consumers, this could mean significant savings on medical services, from routine checkups to life-saving procedures.

Hospitals Push Back Against the Legislation

Not everyone is on board with the proposal. Hospital groups argue that the measure could have unintended consequences, including reduced funding for community health programs and staff reductions.

Indiana’s major hospital networks have pushed back, stating that the bill could hurt the quality of care and limit their ability to invest in new medical technologies and facilities. They also argue that nonprofit hospitals already reinvest revenue into community services, including free and reduced-cost care for low-income patients.

What’s Next for HB1004?

Now that HB1004 has passed through the Health Committee, it moves to the full House for further debate. If it gains approval there, the bill will head to the Senate for consideration.

The legislation is expected to face strong opposition from hospital lobbying groups. However, with bipartisan support from lawmakers who argue that healthcare affordability is a pressing issue, HB1004 has a real chance of becoming law.

As the debate continues, Indiana residents will be watching closely to see if the state takes this bold step to curb rising healthcare costs.