Indiana § 27-1-46-18 - Compliance with federal requirements

§ 27-1-46-18. Compliance with federal requirements

Sec. 18. The requirements of this chapter do not apply to a facility or practitioner that:

(1) is required to comply with; and

(2) is in compliance with;

45 CFR Part 149, Subparts E and G, as may be enforced and amended by the federal Department of Health and Human Services.

As added by P.L.165-2022, SEC.10. Amended by P.L.190-2023, SEC.23.

IC 27-1-46.5Chapter 46.5. Direct to Employer Health Care Arrangements

27-1-46.5-1"Direct to employer health care arrangement" 27-1-46.5-2"Full Medicare" 27-1-46.5-3"Hospital" 27-1-46.5-4"Hospital system" 27-1-46.5-5"Indiana nonprofit hospital system" 27-1-46.5-6"Narrow network" 27-1-46.5-7"Prices" 27-1-46.5-8"Third party administrator" 27-1-46.5-9Offer of a direct to employer health care arrangement by Indiana nonprofit hospital system; benchmark; requirements; audit; assessment 27-1-46.5-10Offer of a direct to employer health care arrangement by a hospital; benchmark; requirements; audit; assessment 27-1-46.5-11Provision of claims data by third party administrator; compliance with federal law; complaint process

IC 27-1-46.5-1"Direct to employer health care arrangement" Sec. 1. As used in this chapter, "direct to employer health care arrangement" means an arrangement between:

(1) a hospital;

(2) a hospital system;

(3) an Indiana nonprofit hospital system; or

(4) a narrow network of hospitals;

and an employer that provides health care benefits for covered services under an employee benefits plan.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-2"Full Medicare" Sec. 2. As used in this chapter, "full Medicare" refers to the amount the Medicare program pays for a covered service, including all hospital-specific Medicare adjustments.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-3"Hospital" Sec. 3. (a) As used in this chapter and except as provided in subsection (b), "hospital" means an acute care hospital licensed under IC 16-21.

(b) The term does not include the following:

(1) A hospital specifically intended to diagnose, care, and treat the following:

(A) Individuals with a mental illness (as defined in IC 12-7-2.1-197).

(B) Individuals with a developmental disability (as defined in IC 12-7-2.1-118).

(2) A hospital designated by the Medicaid program as a long term care hospital.

(3) A hospital that is a Medicare certified, freestanding rehabilitation hospital.

(4) A hospital that is operated by the federal government.

(5) A critical access hospital.

(6) A rural emergency hospital.

As added by P.L.216-2025, SEC.46. Amended by P.L.145-2026, SEC.145.

IC 27-1-46.5-4"Hospital system" Sec. 4. As used in this chapter, "hospital system" means one (1) or more hospitals, all of which are related by direct or indirect common control or ownership.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-5"Indiana nonprofit hospital system" Sec. 5. As used in this chapter, "Indiana nonprofit hospital system" means a hospital system that:

(1) is organized as a nonprofit corporation or a charitable trust under Indiana law or the laws of any other state or country and that is:

(A) eligible for tax exempt bond financing; or

(B) exempt from state or local taxes;

(2) filed jointly one (1) audited financial statement with the Indiana department of health in the preceding calendar year; and

(3) has an annual net patient service revenue derived in Indiana of at least two billion dollars ($2,000,000,000), based on the hospital system's most recently submitted audited financial statement filed with the Indiana department of health. As used in this subdivision, "patient service revenue" includes similar terms, including net patient service revenue and patient care service revenue.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-6"Narrow network" Sec. 6. As used in this chapter, "narrow network" means an arrangement that limits the hospitals that a covered individual may use to obtain covered services under an employee benefit plan.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-7"Prices" Sec. 7. As used in this chapter, "prices" means the amounts that are paid for patient care services.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-8"Third party administrator" Sec. 8. As used in this chapter, "third party administrator" means an individual or entity that performs administrative services for a direct to employer health care arrangement.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-9Offer of a direct to employer health care arrangement by Indiana nonprofit hospital system; benchmark; requirements; audit; assessment Sec. 9. (a) Beginning September 1, 2025, an Indiana nonprofit hospital system shall offer a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare.

(b) The benchmark described in subsection (a) shall be calculated by taking the sum of:

(1) hospital inpatient facility prices; and

(2) hospital outpatient facility prices;

expressed as a percentage of full Medicare.

(c) An Indiana nonprofit hospital system meets the requirements of subsection (a) by doing any of the following:

(1) Offering a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare at each individual hospital within the Indiana nonprofit hospital system.

(2) Offering a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare as an Indiana nonprofit hospital system.

(3) Participating in a narrow network of hospitals to offer a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare.

(d) Beginning October 1, 2025, and before every October 1 thereafter, an Indiana nonprofit hospital system shall cooperate with an audit by the Indiana department of health to determine compliance with this section.

(e) The Indiana department of health shall assess an Indiana nonprofit hospital system that the Indiana department of health determines through an audit has violated this section with a civil penalty of ten thousand dollars ($10,000) per day per hospital for which the Indiana nonprofit hospital system is unable to demonstrate compliance with this section. A fine collected under this subsection shall be deposited into the payer affordability penalty fund established by IC 12-15-1-18.5.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-10Offer of a direct to employer health care arrangement by a hospital; benchmark; requirements; audit; assessment Sec. 10. (a) Beginning September 1, 2026, a hospital that is not a part of an Indiana nonprofit hospital system shall offer a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare.

(b) The benchmark described in subsection (a) shall be calculated by taking the sum of:

(1) hospital inpatient facility prices;

(2) hospital outpatient facility prices; and

(3) professional fee for services provided to a patient by an employed qualified practitioner;

expressed as a percentage of full Medicare.

(c) A hospital meets the requirements of subsection (a) by doing any of the following:

(1) Offering a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare as an individual hospital.

(2) Offering a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare as a hospital system.

(3) Participating in a narrow network of hospitals to offer a direct to employer health care arrangement that is at or below a benchmark of two hundred sixty percent (260%) of full Medicare.

(d) Beginning October 1, 2026, and before every October 1 thereafter, a hospital shall cooperate with an audit by the Indiana department of health to determine compliance with this section.

(e) The Indiana department of health shall assess a hospital that the Indiana department of health determines through an audit has violated this section with a civil penalty of ten thousand dollars ($10,000) per day per hospital that is unable to demonstrate compliance with this section. A fine collected under this subsection shall be deposited into the payer affordability penalty fund established by IC 12-15-1-18.5.

As added by P.L.216-2025, SEC.46.

IC 27-1-46.5-11Provision of claims data by third party administrator; compliance with federal law; complaint process Sec. 11. (a) Not later than thirty (30) days after a request by a contract holder of a direct to employer health care arrangement, a third party administrator that has contracted to administer a direct to employer health care arrangement shall provide claims data to the contract holder. The claims data must include the following:

(1) The effective date of coverage.

(2) The total number of covered individuals.

(3) The total monthly earned premium.

(4) The total monthly dollar value of paid claims, regardless of the period in which the claims were incurred.

(5) The:

(A) beginning and end date of the period for which claims were paid; and

(B) percentage of claims that were paid in:

(i) less than thirty (30) days;

(ii) thirty (30) days to sixty (60) days;

(iii) sixty-one (61) to ninety (90) days; and

(iv) over ninety (90) days.

(6) The reserve value as of the beginning of the period and the reserve value as of the date through which the paid claims data was obtained.

(7) A description of each large or catastrophic claim exceeding fifty thousand dollars ($50,000), including:

(A) the diagnosis;

(B) the dollar amount of the claim;

(C) whether the claim is opened or closed; and

(D) the length of time the claim was open.

(8) Any other claims data requested by the contract holder.

(b) Information provided under this section must be provided in accordance with the federal Health Insurance Portability and Accountability Act, including 45 CFR Part 160 and Part 164, Subparts A and E.

(c) Before January 1, 2026, the department shall establish a process for a contract holder of a direct to employer health care arrangement to file a complaint with the department that a third party administrator violated this section. The department shall conduct an examination under IC 27-1-3.1 upon receiving a complaint under this subsection.

As added by P.L.216-2025, SEC.46.

IC 27-1-47Chapter 47. Activities Not Prohibited as Rebates

27-1-47-1Definitions; permitted activities 27-1-47-2Permitted products and services 27-1-47-3Value-added products or services that may be offered or provided 27-1-47-4Rules