As federal Medicaid cuts loom, consumer advocates are celebrating Washington's new bill limiting hospital prices for state and public school employees.
Senate Bill 5083 caps reimbursement rates for nearly 700,000 people covered by the Public Employees Benefits Board and School Employees Benefits Board.
Sam Hatzenbeler, legislative director for the Economic Opportunity Institute, said public and school employees pay more than twice what the federal government said is a fair price for Medicare, with some hospitals charging up to four times more.
"At a time when everyone is going to be asked to tighten their belts due to federal cuts, it's more important than ever to be prudent with our health care resources," Hatzenbeler contended.
Washington hospitals pushed hard against the bill, warning it will add pressure to their already stretched budgets. Hatzenbeler pointed to a similar law passed in Oregon in 2019, which saved the state more than $100 million and cut out-of-pocket costs for patients by nearly 10%.
Adam Zarrin, director of state government affairs for the Leukemia and Lymphoma Society, said large hospitals consolidating through buying up their competitors is one of the reasons health care costs have grown out of control.
"States can and should take action to try to increase competition in this health care space," Zarrin argued. "Because we know that those market factors can help drive and keep costs down."
Public and school employee health insurance rates have risen more than 6% annually since 2021, compared to roughly 10% annually for other plans. Hatzenbeler added while the cap is a step forward for public workers, lawmakers must expand the relief statewide.
"The data tell us that there are plenty of ways to trim excessive spending," Hatzenbeler emphasized. "For example, we can look at healthcare CEO salary data. But we simply can't shift more costs onto the backs of people who are already struggling to get health care."
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By Marilyn Odendahl for The Indiana Citizen.
Broadcast version by Joe Ulery for Indiana News Service reporting for the Indiana Citizen-Free Press Indiana-Public News Service Collaboration.
In a move applauded by advocates and lawmakers alike, the Indiana General Assembly will be taking a closer look at the estimated $2.2 billion in medical debt that is saddling many Hoosiers and often causing a devastating impact beyond the household budget.
“We all want to be able to care for ourselves and our loved ones, but medical debt poses undue financial hardship that prevents this from being a reality for countless Hoosiers,” Zia Saylor, researcher at the Indiana Community Action Poverty Institute, said in a press release. “It is important that lawmakers recognize the medical debt crisis we have and the urgent need for policies to address it.”
The Legislative Council included medical debt among the 22 topics that it assigned for further examination by the interim study committee process this summer and fall. On Wednesday, the council members unanimously passed a resolution that divided the topics between more than a dozen interim committees.
Initially, the Legislative Council began with 100 proposals for study topics this summer, plus 300 agency reports that presented more topics for possible review, according to George Angelone, executive director of the Legislative Services Agency. Through a “bipartisan process,” the list was whittled down to less than two dozen.
Other subjects scheduled for study include the economic value of Indiana’s public land for recreation, barriers to entering licensed professions, teaching water safety as part of the K-12 curriculum, salaries for K-12 administrators, the usage and cost of long-term-care insurance, and pollution caused by improperly discarded cables. Also, the Government Reform Task Force has been charged with reviewing the “efficiency and effectiveness” of various state boards, commissions and councils, and the Artificial Intelligence Task Force, established by state statute in 2024, will continue to examine the use of AI technology and the potential effects on Indiana residents’ constitutional rights, employment and economic welfare.
After the council hearing, Senate President Pro Tempore Rod Bray, R-Martinsville, said the work of the interim study committees are an important part of the legislative process. It allows state representatives and senators to dive into the topics and enables the public to provide input as well, which is helpful, he said. Bray and House Speaker Todd Huston, R-Fishers, serve as chair and vice chair, respectively, of the Legislative Council, which is comprised of eight members of the Indiana Senate and eight members of the House.
“Maybe it doesn’t end up in a proposed bill for the next legislative session, but people are always going to walk away with more facts and more information about that particular subject,” Bray said.
Democratic lawmakers were upbeat about the assignments to the committees. Senate Minority Leader Shelli Yoder, D-Bloomington, said the Democrats pushed topics that focused on improving Hoosiers’ lives. Many families, she said, are struggling to raise their children, care for their aging parents and stretch their wages to cover rising costs.
“That why our caucus fought very hard to make sure that this year’s study committee didn’t just check a box (but) that they had something meaningful to offer to Hoosiers,” Yoder said after the hearing. “We pushed hard for real topics, real impact and we have many successes to point to.”
‘Medical debt is no-fault debt’
For Democrats, the legislature’s decision to study medical debt is a win.
The interim study committee on the courts and the judiciary has been tasked with examining medical debt, the only topic on its agenda. As part of its study, the committee will look at financial protections for individuals through caps on monthly payments for such debt and limitations on collections or liens on property, along with restrictions on garnishment of wages. Also, the committee will focus on nonprofit and county hospitals by reviewing the definition for charitable care and the requirement to offer payment plans in addition to notices about medical bills to patients.
Speaker Huston and Sen. Fady Qaddoura, D-Indianapolis, both suggested the medical debt topic.
Huston said the topic was spurred by the many different constituents who reached out, telling their stories of the immense financial burden that overdue medical bills can be.
“We will at least take a look at it and understand it, particularly for low-income folks or people that have had some kind of… large, expensive medical procedures,” Huston said of medical debt. “How do you help them get out from behind the eight ball? We’ll take a look at that and see what the options are.”
During the 2025 legislative session, Qaddoura introduced Senate Bill 317 which sought to address medical debt by offering protections similar to those that will be studied by the committee. The measure died after it was narrowly defeated in a 26-to-23 vote in the Senate.
“We should stop penalizing people for getting sick,” Qaddoura said in a statement. “Medical debt is often unavoidable and disproportionately affects those already struggling. Our goal should be to create a path forward that lifts people up, not holds them back.”
Indiana residents are some of the most burdened with medical debt in the country. A 2022 study by the Indiana Community Action Poverty Institute, Grassroots Maternal and Child Health Initiative, and Prosperity Indiana, found that residents of the Hoosier state had the 11th highest share of medical debt in collections nationwide, which equals $2.2 billion outstanding and was the highest among the state’s Midwestern neighbors.
Delinquent or high medical debt contributes to a number of harmful consequences, according to the report. More than negatively impacting the financial health of a household, medical debt can degrade an individual’s physical and mental health. Also, unpaid medical bills can create barriers to credit and housing and can lead to garnishment of wages, property liens and reduced access to health care services.
“Medical debt is no-fault debt,” Dave Almeida, director of state government affairs for the Leukemia & Lymphoma Society, said in a press release. “It’s different from other debt because no one chooses to become sick, which means that no one should have to choose between putting food on the table, paying the rent, putting the kids through college, or engaging in life-saving treatment.”
Council bypasses some committees
Six study committee created by statute were not assigned any topics, including the elections body.
The interim study committee on elections has not met since 2017. However, bills that mostly restrict voting and elections have been introduced each legislative session, culminating in a flood of legislation this year that one voting-rights advocate described as “an assault on democracy.”
Bray did not express any concern about not giving any topics to elections and other committees, including education, public policy and public safety, and military affairs.
“We had a lot of legislation in those areas this last session and sometimes you’ve got to let some of those issues bake a little while … before you have a new issue that you really have to grapple with,” Bray said.
Yoder said she was disappointed that the Child Welfare Task Force was not assigned any topics. Passed this session with strong bipartisan support, House Enrolled Act 1273, authored by Rep. Dale DeVon, R-Granger, created the 22-member task force to study child welfare topics. The law requires the task force to submit two reports in October 2026 and October 2027, but does not specify any areas or subjects that should be studied.
Sen. Andrea Hunley, D-Indianapolis, was hopeful the study committees’ examination of the issues most concerning to families, such as clean water, maternal health and medical debt, would yield some legislation addressing key concerns in the 2026 General Assembly session.
“We also know that a single study in the interim isn’t going to fix everything,” Hunley said. “But we also know that it can spark the change that is necessary. It can be the momentum builder that we need to make sure that we’ve got the momentum going into session, so that we can have the bipartisan support necessary to pass important legislation that this is the time where that happens.”
Marilyn Odendahl wrote this article for The Indiana Citizen.
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