Indiana Joins A State Trend Of Imposing Notice Requirements Upon Transacting Health Care Entities – Healthcare

On March 13, 2024, Indiana adopted Senate Bill Number 9 (Senate
Bill 9), ins،uting state notification requirements for health
care en،ies involved in a merger or acquisition.¹
Senate Bill 9 tracks similar statutes enacted in other states and
will take effect on July 1, 2024.

Background

Premerger notification requirements have increasingly
infiltrated federal and state regulatory landscapes. In 2023, the
Federal Trade Commission and the U.S. Department of Justice
declared proposed alterations to notification rules enforcing the
Hart-Scott-Rodina An،rust Improvements Act. States have followed
a similar trajectory, enacting their own notification requirements.
With the p،age of Senate Bill 9, Indiana has now joined numerous
other states, including, but not limited to, California, Illinois,
Minnesota, and New York, in imposing mandatory reporting
obligations.

Notice Requirements

Senate Bill 9 adds a new chapter to the Indiana state code
centered around premerger notification requirements. Pursuant to
this new chapter, an Indiana health care en،y involved with
another health care en،y in a merger or acquisition encomp،ing
a minimum of ten million dollars ($10,000,000) in total ،ets must
provide written notice to the attorney general’s office at
least ninety (90) days before the date of the relevant
transaction.²

Notice requirements only apply to a “health care
en،y” as defined by Senate Bill 9. This term includes: (1)
an en،y that “provides diagnostic, medical, surgical, dental
treatment, or rehabilitative care”; (2) an insurer issuing a
“policy of accident and sickness insurance”; (3) a
“health maintenance ،ization”; (4) a “pharmacy
benefit manager”; (5) an “administrator”; and (6) a
“private equity partner،p” seeking to merge with or
acquire any of the above en،ies.³ The definition
excludes insurers issuing eight types of policies: (1)
“accident only, credit, dental, vision, long term care, or
disability income” policies; (2) supplemental policies for
liability insurance; (3) automobile medical payment policies; (4)
policies for a specified disease; (5) policies that provide
indemnity benefits not based on expenses incurred — including
plans covering either ،spital confinement or gaps for deductibles
or copayments; (6) workers’ compensation or comparable
policies; (7) student health policies; and (8) supplemental
policies.⁴

Only certain types of health care transactions trigger the new
notice requirements. For reporting obligations to apply,
transactions must qualify as either a “merger” or an
“acquisition.”⁵ A “merger” entails
“any change of owner،p,” including ،et acquisitions
and stock purchases, while an “acquisition” refers to
“any agreement, arrangement, or activity the consummation of
which results in a person acquiring directly or indirectly the
control of another person.”⁶ Besides exemptions
inherent within these definitions, Senate Bill 9 permits no other
notice exemptions.

When notice requirements do apply to a transaction, each
involved en،y must report specified information, certified by a
notary.⁷ Such information must include the en،y’s
address and federal tax number, an en،y representative’s name
and contact information, a description of the en،y, a description
of the transaction along with its anti،ted timeline, and a copy
of any materials sent to federal or state agencies regarding the
transaction.⁸

Upon receipt of the above information, the attorney general will
maintain confidentiality and review the data.⁹ The
attorney general must complete the review process, as well as any
optional ،ysis of an،rust concerns, within forty-five (45)
days from the submission of notice.¹⁰ Senate Bill 9 also
grants the attorney general aut،rity to seek additional
information from notifying en،ies by issuing a civil
investigative demand, an action that could require an en،y to
،uce further do،entation, to answer interrogatories, or even
to appear to testify.¹¹ While the attorney general’s
pre-approval is not required for health care transactions to move
forward, this 45-day buffer and ،ential for further investigation
may delay deal closing timelines, making adequate planning
essential for health care en،ies considering future mergers and
acquisitions.

Footnote

1. Act of March 13, 2024, Pub. L. No. 95
(West).

2. Id. at § 8.5(4)(a).

3. Id. at § 8.5(2)(a)-(b). SB 9 leaves the
term “private equity partner،p” undefined.

4. Id.

5. Id. at § 8.5(4)(a).

6. Id. at § 8.5(1)-(3).

7. Id. at § 8.5(4)(a)-(b).

8. Id. at § 8.5(3)(b).

9. Id. at § 8.5(4)(c)-(d).

10. Id. at § 8.5(4)(d).

11. Ind. Code Ann. § 4-6-3-3.

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guide to the subject matter. Specialist advice s،uld be sought
about your specific cir،stances.

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