Breaking: Indiana gets alternative ACA Medicaid expansion program approved, starts TODAY

Hat Tip To: 
Emma Sandoe, Louise Radnofsky, Esther Ferington

This Just In...

Gov. Pence gets federal OK for Medicaid alternative

Indiana has been given the green light to expand its Healthy Indiana Plan, which would offer insurance to an additional 350,000 Indiana residents who currently lack insurance.

The state will begin taking applications immediately for its so-called HIP 2.0 plan, for which coverage begins Feb. 1, Gov. Mike Pence announced Tuesday morning at a packed speech at St. Vincent Health.

So, what makes this different from standard Medicaid expansion?

Indiana is the only state to apply private market measures, such as requiring participants to make monthly contributions to help cover the benefit.

Anyone who falls below 138 percent of the federal poverty level will now be eligible to enroll in what the state is terming the Healthy Indiana Plan Plus. The plan includes dental and vision benefits, as well comprehensive prescription drug benefits.

Participants in this plan will be expected to make contributions of between $3 and $25 per month, or about 2 percent of the annual income for the year.

Hmmm...ok, so it sounds like basically a heavily subsidized private plan, really, which is fine, I guess...

If a person on this plan who falls below 100 percent of the poverty fails to make his or her contribution, he or she will be moved to a basic plan that requires co-payments for all services, something not seen on the Plus plan and which will reduce the person's benefits.

The plan contains other measures that fit with its original philosophy of placing some of the burden of the cost of health insurance on participants. For instance, the first non-urgent emergency room visit will incur a copay of $8; the second, $25.

Huh. OK, so if you're poor, they'll give you a great plan (dental & vision! nice!) for $3 - $25/month, but if you're really, really dirt poor, they're gonna give you a worse plan and charge you...well, not necessarily more, but differently (instead of $3 - $25/month, it'll be $8 - $25/visit).

Sounds awfully confusing and possibly ass-backwards to me, but I guess it's better than nothing. Fair enough.

The most interesting thing about the Indiana plan, however, is the funding mechanism:

Funding for the plan would come from cigarette tax revenues as well as from the hospital assessment fee.

Since the ACA Medicaid expansion provision calls for the federal government to pick up 100% of the tab for the first few years, with the state gradually working it's way up to 10% of the cost, this basically means that Indiana will get their version pushed through at no additional cost to the state budget permanently (although this is just a question of semantics...there's really 2 headlines here; the other is "Red State Republican Governor agrees to raise taxes & fees"...which just happen to be specifically to cover the upcoming cost of the Medicaid expansion program).

So, it's confusing and will no doubt cause a lot of paperwork/bureacratic headaches, but whatever: Credit where it's due, Indiana, and congrats to the 350K residents who are apparently eligible for Medicaid once they jump through these hoops.

What's most impressive here is the start date: According to another story from the WSJ:

The program will begin taking new enrollments Tuesday, for coverage that begins Feb. 1, Ms. Verma said.

Officials and advocacy groups looking at Medicaid expansion in Alabama, Florida, Idaho, North Carolina and Wyoming have indicated they were watching the outcome of the Indiana deliberations as a possible factor that could change their state’s decision.

Tuesday? As in today, for coverage starting this Sunday?? OK, kudos all around.