Indiana says yes to Medicaid expansion

Health News

Indiana has agreed to become the 28^th state of the Union to expand the Medicaid program, the Obama administration and Indiana Governor Mike Pence announced separately on Tuesday. The expansion, known as Healthy Indiana Plan 2.0 (HIP 2.0), will allow 350,000 low-income residents of the state to enroll immediately. Coverage starts on February 1^st. Pence is an ardent Republican conservative, so this move could have a domino effect and persuade other GOP-helmed states to at least consider expanding Medicaid as well. For example, states with large uninsured populations such as Florida and Texas, whose Republican leaders have thus far resisted expansion, could be open to it if they knew they could mold it in their image, so to speak.

Take Pence, for instance, who will not just expand the insurance program but will use federal funding – the government will pay for 100% of the expansion through 2016, and at least 90% afterward – to distance Indiana as much as possible from the traditional model, in which people with low incomes and people with disabilities are covered by a government program that pays for their medical care. In a first for Medicaid, HIP 2.0 will link benefits to monthly payments by beneficiaries below the poverty line. Other conservative and market-based hallmarks include requirements that beneficiaries contribute to premiums and other costs through health savings accounts – called ‘POWER accounts.’ “We have worked hard to ensure that low-income Hoosiers have access to a health care plan that empowers them to take charge of their health and prepares them to move to private insurance as they improve their lives,” Pence said in a news release.

The so-called POWER accounts are based on health savings accounts in the private sector. Under HIP 2.0, people above the poverty line (approximately $11,500 for a single person) must contribute $3-$5 a month to these accounts; failure to do so can see them stripped of their benefits for six months. Deposits are optional for people below the poverty line, but opting to make contributions can net them better coverage. People who use the accounts will pay less for required preventive health services. Indiana will pay for their 10% of the cost of the program after 2016 with state cigarette taxes and with aid from the Indiana Hospital Association. Most hospital associations in the U.S. favor Medicaid expansion because treating uninsured, low-income patients loses them money.

Alaska, Tennessee, and Utah are among the Republican states debating some sort of Medicaid expansion this year. “I continue to be encouraged by interest from governors from all across the country who want to bring health care coverage to low-income people in their states by expanding Medicaid,” Health and Human Services Secretary Sylvia Burwell said. “The administration will continue to work with governors interested in expanding Medicaid to devise approaches that work for their states while keeping faith with the law’s goals and consumer protections.” Governor Pence will certainly take his liberties with the program, but president Obama is more than willing to make concessions in order to ensure that as many poor Americans as possible are covered by Medicaid.

Related Read:

Indiana agrees to expand Medicaid under Obamacare.

Indiana Gov. Mike Pense expands Medicaid under Obamacare.

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