Indiana Hospital Association General Counsel Tim Kennedy said a state bill that seeks to revoke the nonprofit status of a hospital if it charges patients more than 200% of the Medicare reimbursement rate is "not fair or rational," TheStatehouseFile.com reported Jan. 28.
Speaking at a House Public Health Committee meeting on the bill, Mr. Kennedy said that if a hospital has thousands of services that cost under 200% of the Medicare reimbursement rate but one is above that threshold, the hospital would still lose its nonprofit status.
Mr. Kennedy also said that hospitals contribute to their communities in other ways such as charitable donations and health education, according to the report. Mike Shroyer, president and CEO of New Albany-based Baptist Health Floyd, said that forcing nonprofit hospitals to operate at prices under 200% of the Medicare reimbursement rate would hamstring their ability to do community work.
Indiana’s Secretary of Health and Family Services, Gloria Sachdev, PharmD, said she supports the legislation, which she said does not put a cap on hospital prices, but instead gives them the option to lower their prices or become a for-profit, according to the report.
The bill's sponsor, Rep. Martin Carbaugh, cited a Rand Corp study that found that Indiana has the eighth-highest hospital prices in the nation and argued that nonprofit hospitals fall short physician compensation.
"Where is the money going?" he said at the hearing, "It is not ending up in the hands of people who are doing the work."