STATEHOUSE (April 25, 2025) – Legislation authored by State Rep. Julie McGuire (R-Indianapolis) to encourage patients to shop for more cost-effective treatment options recently passed the Indiana General Assembly and now goes to the governor for consideration as a new law.
A RAND study found that health care consumers frequently lack access to transparent pricing for medical services, with wide variation in rates negotiated by insurance companies. Paying in cash for treatment has become more common, with these costs often lower than insurers' negotiated rates. However, McGuire said these direct payments often don't count toward a person's annual health insurance deductible or out-of-pocket maximum costs.
"Without incentives for patients to find more affordable treatment, they spend more than is necessary while insurance premiums continue to increase," McGuire said. "Hoosiers deserve the ability to shop around for the most-effective health care, just like they do for so many other necessities."
House Enrolled Act 1604 would require insurance companies to apply cash payments for health services to an individual's annual policy deductible and out-of-pocket maximum costs. McGuire said this shift would ensure that patients who seek more affordable care options are not penalized while also saving providers time and money on paperwork and insurance negotiations, and encouraging them to make their prices competitive to attract more patients.
Additionally, McGuire's legislation would require health insurers to establish a clear and straightforward process for individuals to claim credits for cash payments and either publish their average discounted rates or refer consumers to typical rates listed on Indiana's All Payer Claims Database.
To learn more about House Enrolled Act 1604 and other proposals for new laws, visit in.gov/gov/newsroom/2025-bill-watch.
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State Rep. Julie McGuire (R-Indianapolis) represents House District 93,
which includes a portion of Marion County.
Click here to download a high-resolution photo.
