Indiana Lawmakers Continue to Take Aim at Health Care Organization Mergers

On February 27, 2024, the Indiana House of Representatives (“House”) voted to pass legislation that would call for increased scrutiny regarding mergers between health care organizations. More specifically, the implementation of Senate Bill 9 would require Indiana health care entities involved in mergers or acquisitions of at least $10 million in total assets to provide written notice to the Indiana Attorney General Office (“OAG”). Along with other enumerated requirements, this notice would have to be submitted to the OAG in writing no later than 90 days prior to the date of the merger. After reviewing the proposal, the OAG would then communicate any antitrust concerns associated with the merger back to the health care organizations and may issue a civil investigative demand in accordance with Indiana law.

The Indiana Hospital Association has spoken out against the proposed bill, claiming that current federal oversight of mergers is sufficient and that the timing requirements associated with the bill would significantly hinder health care organizations’ ability to complete such transactions. Of course, while there were several representatives that seemed to share in these sentiments, there appears to have been even more members of the House that fell the other way.

In the eyes of Senator Chris Garten, one of the authors of Senate Bill 9, the requirements that the bill would impose are minimal. Garten has emphasized that the scope of the bill does not include giving the OAG the authority to approve or deny any mergers or acquisitions. Additionally, the bill would require that all non-public information be kept confidential by the OAG and does not currently have any penalty provisions for failure to provide notice. From Garten’s perspective, giving the state time to review the details of a merger and ensure that it is in the best interest of Hoosiers everywhere is a more than reasonable request.

Due to these substantial implications, Indiana health care organizations should continue to monitor Senate Bill 9 as it makes its way through the Indiana legislature. After being amended and passed by the House, the bill has been sent back to the state Senate for concurrence.

If you have any questions, please contact your local Quarles attorney or:

• Ed Holloran III: (317) 399-2892 / ed.holloran@quarles.com
• Jake Pallotta: (317) 399-2810 / jake.pallotta@quarles.com