On March 13, 2024, Indiana enacted Senate Bill No. 9, which establishes that the Office of the Indiana Attorney General must receive prior written notice of certain transactions involving Indiana healthcare entities. This new law goes into effect July 1, 2024, and has a more expansive reach than many of its peer transaction notice laws in that it expressly identifies private equity firms as qualifying entities, applies to a broad scope of transactions and sets a lower threshold for reportable transactions than other states at $10 million. Indiana has not yet promulgated regulations, rules or guidance related to the law. Parties interested in Indiana’s healthcare landscape should closely monitor developments, as the $10 million threshold and broad definition of “health care entities” is likely to capture healthcare transactions that previously would not have been subject to review.

IN DEPTH

On March 13, 2024, Indiana enacted Senate Bill No. 9, which establishes that the Office of the Indiana Attorney General must receive prior written notice of certain transactions involving Indiana healthcare entities. This new law goes into effect on July 1, 2024, and has a more expansive reach than many other states’ transaction notice laws, in that it (i) expressly identifies private equity firms as qualifying entities and (ii) applies to a broad scope of transactions and sets a lower threshold – $10 million – for reportable transactions.

Under the Indiana law, an Indiana health care entity in a merger or acquisition with another health care entity where (i) at least one of the entities is an Indiana health care entity, and (ii) at least one of the entities has $10 million or more in total assets, must notify the Office of the Indiana Attorney General at least 90 days in advance of the proposed transaction. (An “acquisition” is defined as any agreement, arrangement or activity that results in an entity acquiring, directly or indirectly, the control of another entity, and a “merger” means any change of ownership, including an acquisition or transfer of assets, and the purchase of stock effectuated by a merger agreement.)

The following health care entities are subject to the notification and review requirements:

• Organizations or businesses that provide diagnostic, medical, surgical, dental or rehabilitative care;
• Insurers that issue policies of accident and sickness insurance (with certain exceptions such as workers’ compensation; student health insurance; or dental, vision or long-term care insurance);
• Health maintenance organizations;
• Pharmacy benefit managers;
• Third-party administrators; and
• Private equity partnerships, regardless of where located, seeking to enter into a merger with any of the foregoing entities.

Within 45 days of submission of the notice, the Office of the Indiana Attorney General must review the notice and may decide to analyze, in writing, any antitrust concerns with the proposed transaction. The Office of the Indiana Attorney General also has express authority to issue a civil investigative demand for additional information about the proposed transaction. The Indiana law specifies that any information received or produced by the state in connection with the notice is confidential.

Indiana has not yet promulgated regulations, rules or guidance related to Senate Bill No. 9, which will provide necessary clarification in a number of areas, including:

• What will constitute an “asset” as referenced in the definition of “merger,” or how the value of such assets will be measured for the purposes of the $10 million threshold.
• Further clarification on the term “Indiana health care entity,” and whether certain types of providers will fall outside of the definition (e.g., whether hospice – which does not technically provide diagnosis, treatment or rehabilitative care – will be excepted from the requirement).
• When the Office of the Indiana Attorney General will begin accepting transaction notices, or whether there will be a grace period for compliance. As written, qualifying transactions will need to close on or before June 30, 2024, or otherwise be subject to the notice requirement and corresponding 90-day review period.
• Penalties, including any fines, for noncompliance with the requirement.

Interested parties in Indiana’s healthcare landscape should closely monitor developments related to this law, as the $10 million threshold and broad definition of “health care entities” is likely to capture healthcare transactions that previously would not have been subject to review.