The Source Blog

Several states passed legislation on key healthcare issues in the 2025 legislative session, including new laws addressing noncompete clauses, prior authorization, and price and ownership transparency. This article highlights five states that have passed significant legislation on healthcare pricing and competition in 2025. Indiana, Washington, Oregon, Montana, and Arkansas have all had ambitious sessions this year regarding healthcare reform; below, we highlight some of the key bills recently passed by these states.

Indiana

Indiana had an ambitious year in 2025, enacting several significant pieces of healthcare legislation. Having new laws addressing third-party administrators, nonprofit hospital price caps, anti-tiering contract provisions, and certificates of public advantage in the same session represents a very significant year for the state.

1. SB0003 creates fiduciary duties for third-party administrators and pharmacy benefit managers working with health insurance plans, requiring them to disclose full fee and cost information, avoid potential conflicts of interest, and provide contractual transparency.
2. HB1003 among other things, prevents contracts that require a health carrier to place all facilities in the same tier of a tiered network plan. The new law also requires laboratories and diagnostic imaging facilities to post pricing information for specific services and requires health providers and insurers to provide good-faith estimates of healthcare costs. The law also prevents insurers from denying a claim solely because the referring provider is out-of-network.
3. HB 1004 requires that nonprofit hospital systems' aggregate average prices must be at or below the statewide average.
4. HB 1666 requires hospitals, health care entities, insurers, and pharmacy benefit managers to report ownership information and allows the attorney general to investigate healthcare concentration.
5. SB119 prohibits the submission of an application for a certificate of public advantage after May 13, 2025.
6. SB0475 prohibits physicians from entering into noncompete agreements, including any contract provisions that restrict a physician's ability to practice medicine after leaving an employer. Exceptions include protecting business confidential information, limited nonsolicitation agreements, and agreements made during the sale of a business entity. The law only applies to new agreements entered into after July 1, 2025, and does not affect preexisting noncompete agreements.

Washington

Washington passed several pieces of litigation to address price and market transparency as well as merger notification.

1. SB5122 creates the Uniform Antitrust Premerger Notification Act, requiring businesses that must file premerger notifications under the federal Hart-Scott-Rodino Act to also file copies with the state AG if their principal place of business is in the state or if they meet minimum in-state sales requirements.
2. HB1382 updates the state payer claims database rules, including its management, data collection, and reporting requirements, including new reporting timelines.
3. HB1686 creates a state-operated healthcare registry to monitor and measure changes in the healthcare market, including healthcare facilities, providers, systems, carriers, and benefit managers. The registry is intended to simplify reporting and information sharing between agencies.

Oregon

Oregon enacted new laws targeting prior authorization and the corporate practice of medicine.

1. SB951 prohibits management service organizations from owning or controlling a majority of shares in medical practices, serving as directors or officers, exercising voting rights, or controlling clinical decision-making. It also voids noncompete clauses and nondisparagement clauses for medical professionals and provides retaliation protections for medical licensees who report potential violations.
2. HB3134 requires insurers to cover additional necessary medical procedures during a pre-authorized surgical procedure without requiring an additional prior authorization if the procedures would already be covered under the patient's insurance. It also requires insurers to create online platforms to receive and process prior authorization claims and to provide more detailed statistical information on prior authorization requests, approvals, denials, and average processing times.

Montana

Montana passed legislation prohibiting noncompete agreements and regulating insurer practices.

1. HB198 expands noncompete protections for healthcare professionals while preserving enforcement in business transactions.
2. HB398 requires insurers to establish continuity of care provisions for three months after a patient changes healthcare plans, establishes more rigorous standards for adverse healthcare determinations, and redefines chronic conditions.
3. HB399 prohibits insurers from requiring prior authorization for generic prescription drugs and preexisting prescriptions, and requires adverse prior authorization determinations to be made by a specialist.

Arkansas

Arkansas enrolled new laws targeting insurers and noncompete clauses.

1. HB1426 broadens the definition of "healthcare insurer" to include third-party administrators, bans all-products prohibition clauses in healthcare contracts, as well as stipulations with similar effects, and increases transparency requirements for leasing and sharing healthcare contracts and provider networks.
2. SB139 voids noncompete agreements for physicians that restrict the physician's ability to practice within their professional scope of practice, but maintains existing protections for trade secrets. Noncompete agreements outside of employment (including business sales or franchise agreements) are not affected.
3. SB527 increases the medical-loss ratio for health insurers by 5%, meaning insurers must spend a higher percentage of premium income on medical care and quality improvement.

Conclusion

While the five states highlighted were especially noteworthy for what they did this year, other states have been active as well. Many states have in-process 2025 healthcare policy bills that will roll over into 2026 that warrant watching. Of course, in our increasingly litigious environment, any of the new laws mentioned here could end up being challenged in court. Ultimately, states seem to be taking an active role in filling gaps left by federal inaction, and it remains to be seen if these trends continue in future legislative sessions.

Download PDF