2013 Indiana General Assembly

Pence may have free hand in Medicaid negotiations

2013-04-01T00:00:00Z 2013-04-01T10:53:04Z Pence may have free hand in Medicaid negotiationsDan Carden dan.carden@nwi.com, (317) 637-9078 nwitimes.com
April 01, 2013 12:00 am  • 

INDIANAPOLIS | It was always a long-shot that Indiana would expand eligibility for its Medicaid program as directed by the Affordable Care Act, also known as Obamacare, given the distrust of the federal government by the state's Republican-controlled Legislature and Republican Gov. Mike Pence. 

However, it appears increasingly likely the General Assembly will adjourn April 29 without taking any steps to prepare Hoosiers for the 2014 mandate that all Americans have health insurance.

The House Public Health Committee will take up Senate Bill 551 today, empowering the state's Medicaid office to negotiate with federal officials on a plan allowing Indiana to use federal funds to create its own health insurance program for low-income Hoosiers and the disabled.

The state substitute for traditional Medicaid would generally follow the existing Healthy Indiana Plan, called HIP, a high-deductible insurance program that requires its low-income participants contribute up to $1,100 a year for their health care costs.

Debra Minott, secretary of the Family and Social Services Administration, told the committee last week that Pence believes state law already allows FSSA to negotiate HIP matters with the federal government and nothing more is needed from the General Assembly, a claim that could potentially scuttle the pending legislation.

House Speaker Brian Bosma, R-Indianapolis, said he's still reviewing whether Minott is correct and deciding whether the Legislature should give FSSA additional direction.

But he nevertheless concurs the only route for expanded Medicaid in Indiana is through HIP. 

"It's a plan that's receiving recognition from all over the country as a consumer-driven alternative for health care for those who can't afford it themselves," Bosma said. "Our team is generally in agreement with the governor and the Senate leadership that the blanket expansion of Medicaid is not the right course now."

House Democratic Leader Scott Pelath, D-Michigan City, believes Bosma and the other Republicans couldn't be more wrong.

He noted there's little evidence the federal government will let Indiana create a substitute health program and failing to do anything will leave up to 400,000 Hoosiers uninsured.

He said Indiana instead should expand traditional Medicaid, which will create 30,000 new jobs, according to the Indiana Hospital Association. It will also reduce health insurance costs for all Hoosiers by no longer forcing the uninsured to seek care at expensive emergency rooms, which drives up the price for everyone, he said.

Pelath also questioned why Hoosier Republicans want to turn Indiana into "an island of the uninsured," as all of Indiana's neighbors -- including the Republican governors in Ohio and Michigan -- have agreed to expand their Medicaid programs.

Under the Affordable Care Act, states are required to expand Medicaid eligibility to Americans earning up to 133 percent of the federal poverty level, which is $14,856 for an individual or $30,657 for a family of four.

However, states cannot be punished if they fail to expand Medicaid. An Indiana resident currently must earn less than 22 percent of the federal poverty level — that's $2,457 for an individual or $5,071 for a family of four — and have limited assets to enroll in Medicaid.

The law also requires the federal government pay 100 percent of the cost of new Medicaid enrollees from 2014 to 2016. After that, the state's share gradually increases to a maximum of 10 percent in 2020.  

But even with little to no state cost to expand Medicaid over the next three years, Bosma insists it's not worth it.

"My experience is once you step into a federal program there's not going to be any stepping out of it," he said. "The better course is to be prudent in not entering a plan that's not clearly in the best interest of Hoosiers, and move thoughtfully in a process rather than rush in and try and get out later."

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