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SB 493

Medicaid value based contracting.

2025 Regular Session Introduced by Michael Crider

SB 493 authorizes Indiana's Medicaid program to implement value-based contracts linking provider payments to healthcare outcomes and cost efficiency rather than service volume.

First reading: referred to Committee on Health and Provider Services
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Bill Summary · SB 493

Legislative bill overview

SB 493 establishes a framework for value-based contracting arrangements within Indiana's Medicaid program, shifting payment models from traditional fee-for-service to outcome-focused compensation structures. The bill authorizes the state to enter into contracts with healthcare providers where reimbursement is tied to quality metrics, patient outcomes, and cost efficiency rather than volume of services delivered.

Why is this important

Value-based contracting is a significant healthcare policy shift that can theoretically reduce unnecessary procedures, improve care coordination, and lower costs by incentivizing providers to focus on patient health rather than service volume. However, implementation directly affects how hospitals, physicians, and other providers are paid, which has substantial implications for healthcare workforce stability, rural provider viability, and ultimately patient access to care across Indiana.

Potential points of contention

  • Provider financial risk: Shifting to value-based payments may disproportionately burden smaller practices and rural providers who lack infrastructure to measure outcomes and manage population health, potentially widening healthcare access gaps
  • Defining quality metrics: Disagreement likely over which outcome measures are appropriate, fair, and achievable across diverse patient populations and provider settings
  • Implementation timeline and support: Concerns about whether the state will provide adequate technical assistance, data infrastructure, and transition funding to help providers adapt to new payment models without operational disruption

Compiled from official sources — confirm details with the bill’s official record.

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