Only now is Pence team starting Medicaid talks

September 3, 2013
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Gov. Mike Pence is in no hurry.

That became crystal clear Monday when Pence announced that his administration won approval from President Obama’s team to expand the Healthy Indiana Plan, or HIP until the end of 2014. But he said talks have yet to begin on using HIP to expand Medicaid coverage for low-income Hoosiers

That go-slow approach could push a possible expansion of Medicaid coverage in Indiana to the end of 2014.

If so, Indiana would lose out on one year of federal subsidies, promised by President Obama's 2010 health reform law.

“We’ve really had no discussions at all on the bigger issue,” said Debra Minott, secretary of the Indiana Family and Social Services Administration, after the press conference in the governor’s office at the Indiana Statehouse.

That means as many as 300,000 Hoosiers will remain uninsured next year that would qualify for Medicaid, if Indiana expanded eligibility up to 138 percent of the federal poverty limit, as called for by Obamacare.

Pence acknowledged those Hoosiers, but said his team is just starting to bargain to cover them, if at all.

“Now that we’ve accomplished this [extension of the HIP program], we’ll continue good-faith discussions [with the Obama administration] about the uninsured in Indiana,” Pence said. Later, he added, “There’s a lot of time between now and the end of 2014.”

That last comment suggests the Pence administration is willing to wait that long to get the deal it wants from Obama. Minott clarified that a deal could be struck any time between now and then, but she added that an expansion would require administrative changes that could be difficult to make before the end of 2014.

To be fair, it looks like President Obama and his team are also OK with leaving 300,000 Hoosiers uninsured. They could have, of course, told Pence straight away that he could use HIP to expand coverage to them, after Pence asked for that authority in April.

Meanwhile, it looks like all the states surrounding Indiana will expand their Medicaid programs, creating odd disparities, especially for low-income residents that live along Indiana’s borders.

Also, there’s a compelling argument that, by not expanding Medicaid coverage, Indiana employers will pay higher health insurance premiums than their peers in neighboring states. That’s because commercial insurance—which is purchased by either employers or by families individually—subsidizes that hospitals incur to care for the uninsured.

Asked whether he was concerned about such a development, Pence emphasized that uninsured Hoosiers could still obtain health care via hospital charity care programs, via publicly subsidized health centers and other public health programs.

“Let’s make sure there’s a distinction in the language between health insurance and health care,” Pence said.

No health policy expert believes those resources are adequate to provide the ongoing care needed by uninsured Hoosiers, and it does not appear Pence does either. He touted the HIP program, for instance, because “it moves people from emergency room care to primary care.”

But Pence thinks the consumer-driven features of the Healthy Indiana Plan are so good, and the problems with the traditional Medicaid program are so bad, that he’s willing to live with a less-than-ideal solution for another 16 months, if necessary. The Healthy Indiana Plan is based on health savings accounts, which its 37,000 beneficiaries use to pay their first $1,100 of medical expenses each year. HIP was originally designed so all recipients had to pay something into those accounts.

“I just think that HIP is in the interests of the health of Hoosiers,” Pence said, explaining, “You’re creating an incentive for people to invest in your own health.”

  • Conclusion jumping
    It's hilarious to me that when you write "to be fair, it looks like President Obama and his team are also OK with leaving 300,000 Hoosiers uninsured" you are being extremely unfair.
    • Ditto
      Ditto to Jerry Brown's comment. To try to pin this neglect of Hoosier uninsureds on President Obama is absolutely unfair. The last I heard -- albeit it more than a year ago-- HIP had a waiting list. Is that still true? Other problems with the program are the requirement that people be uninsured for 6 months,and the very low annual/lifetime maximumums. Do those still apply? The "Consumer Driven" terminology is a joke because, as you've written, J.K., consumers can't call a hospital - or even some physicians' offices -- and get a straight answer about what a service will cost. Also, the state pays most of the money into the power accounts (how much is based on income), so there's not much personal money being spent before coverage begins. That's good, since there aren't many people at 200% or below poverty level who have $1,100 dollars laying around. It's not difficult to see why the Obama administration doesn't see HIP as a viable substitute for Medicaid expansion. So, for the next year, the State will be paying into power accounts and paying premiums for people who would have been covered 100% by federal expansion dollars. The big question is "Why?"
    • Shame on Pence
      My long term unemployed neighbor has been on the HIP waiting list for 2 years. She was just told last week that there are people ahead of her that have been on the list for 3 years. HIP was a sham when it was put into place. It was a "token" program so Mitch Daniels could claim that he was taking care of the uninsured while lying through his teeth! It was never intended to cover the thousands of people that needed it. How is it OK with Mike Pence to force low wage adult employees to pay taxes into Medicare and Medicaid, yet not to receive Medicaid themselves when they qualify financially? This is just plain disgusting and inhumane.
    • response
      Interesting that JK Wall hasn't responded to the comments above. Just because the IBJ is in Indiana doesn't mean that you have to blame President Obama for everything.
      • RE: To be fair
        To Jerry, Sally and Maria: I did not respond to your comments because I welcome criticism that is based on an honest difference of views. I tend to respond when I feel someone has said something that is factually inaccurate or which misunderstands something I wrote. But as for laying some blame on both Pence and Obama for the lack of a Medicaid expansion in Indiana, here is my reasoning: In any two-party negotiation, the failure to reach a deal implies that both parties found the lack of a deal more favorable than accepting the other's terms. So if I'm going to write a post somewhat criticizing Pence for allowing 300,000 Hoosier to remain uninsured because he finds the terms of Obama's traditional Medicaid expansion unacceptable, clearly, it is also true that Obama would rather 300,000 Hoosiers remain uninsured than to accept the HIP plan as the vehicle for a Medicaid expansion. I have taken no position in this Pence-Obama argument. I have not said the argument is not important for the health and financially well-being of the uninsured. All I'm saying is that, if either Pence or Obama had said covering the uninsured in some way is more important than winning the argument, then there would be a deal already. So it would be unfair to blame the lack of a deal entirely on either Pence or Obama.
        • Indiana Pensive about ACA?
          “Let’s make sure there’s a distinction in the language between health insurance and health care,” Pence said. Unfortunately health insurance is health care. Emergency care is not a viable long term solution, which is why the ACA came about in the first place. Pence also stated Hoosiers can use charitable and government funded medical clinics. Ironically, they are overloaded, short staffed and short funded because of legislation promoted by Mr. Pence. No one should be left out of the Medicaid expansion just to make a political point. It is at no risk to Indiana. The first three years are completely covered by the Federal government.
        • A Taxpayer's Perspective
          If Indiana decides to expand Medicaid, Hoosier taxpayers will be stuck with the bill for the expansion when federal subsidies expire in a few years. It's much like a drug dealer getting a person hooked on crack with free samples and then walking away and leaving society stuck with the cost for supporting the crackhead's habits through theft and other crimes. Pence is right to take a slower approach on behalf of the Hoosier TAXPAYERS he serves.
          • MIKE IS SLOW
            As stated Mike is slow but he is very good at reading a speech. I do not expect much from him
          • Pence Is Shamelessly Slow
            I agree with many of the comments posted thus far. I too think Pence is a very disappointing and full of fluff when it comes to helping Hoosiers with health care options. Perhaps, heartless and/or naïve are more appropriate descriptors. HIP is a joke; my stepdaughter has been waiting 3 years to get coverage and has given up. Pence and his administration has offered no alternative. And, one final thought, if HIP is extended, the program needs performance measures to show trends in coverage, responsiveness, and outcomes. The situation is simply disgusting.
          • Give $$ to other states
            It's too bad that the Indiana media just falls in line with the press releases of the Republican politicians. The public doesn't get much of a comparison of how other states are taking advantage of state-federal partnerships when all they hear about are the talking points of people like Gov. Pence. First the author might have presented the estimated dollar amount the Federal Government would have been paying of the 100% cost of Medicaid expansion per year. Would that amount (I'm assuming it would be millions of dollars) make a difference in jobs as well as the costs that other Hoosiers have to pay so that thousands of people don't show up at emergency rooms to get basic care? Second, in response to the author's cute response that President Obama is in a dispute with Gov. Pence on the HIP plan to use medical savings accounts and have low income citizens pay part of their health care costs, I have to wonder at how shallow the author thinks the readers are. The Affordable Health Care Act was passed by Congress, opposed by Republicans screaming and kicking all the way past being declared the law of the land by the Supreme Court. Now, for some reason the author wants to present that the President can be in a dispute with a Republican Governor who wants to make political points by getting his own HIP plan approved? Wouldn't it be more accurate to say that the Governor of Indiana wants to have the ACA overturned and he doesn't seem to want any Hoosiers to benefit from it if he can prevent it? The Affordable Care Act allows for innovations, but not for programs that really don't seem to work like HIP. I understand that there's always been a waiting list for HIP and now Pence's solution to getting more people served is to lower the income limits so that fewer people qualify. Let's see, the Affordable HCA says to expand to cover 300,000 uninsured and the HIP plan is to disqualify more Hoosiers from the program and use the same dollars. HIP is covering about 34,000 Hoosiers? And that's the "victory" that Pence is telling the public about? I guess I'm not sure if I am more disgusted at these political tactics or the fact that the media in Indianapolis just totally fails to present the issue in a way that it can be understood. I think the author should present a little clearer picture of how Hoosiers may be hurt by these political tactics to prove the President wrong regardless of the facts of ACA
          • Pence
            Oliver, I doubt if you oppose all federal subsidies. I think the real issue is whether you think all U.S. citizens should have good, reliable health care. Personally, I think they should. I might not agree with the approach that has been taken. I think, if Republicans in Congress had wanted a better approach, Obama would have been a willing partner. But Republicans did not want a better approach. They didn't want any approach. This should not be surprising. Historically, conservatives, and I think, today, most Republicans are conservative, have never believed that providing health care for U.S. citizens is a responsibility of government. Indeed, if Johnson did not have overwhelming support when Medicare and Medicaid were first passed, conservatives would have scuttled these programs as well. I think, what it really is about is that some people support good health care for all and are willing to pay for it (me), while other people do not (you).
          • Not exactly...
            In response to Oliver's comment about states being stuck paying for Medicaid in a few years, that is only partially true. The Federal government is going to subsidize 100% of the cost of expansion through 2016. After that, the subsidy gradually decreases to 90% coverage. If it's going to cost the state just 10% to help insure 300,000 Hoosiers, I'd say that's a fair price.
          • Room to compromise
            There has to be a middle ground here between Pence and Obama/Sebelius. The Healthy Indiana Plan will need to be revised to comply with essential health benefit requirements...just like private plans on the exchanges. That means no annual or lifetime maximums. And it will have to take all who meet the income guidelines, not a pre-defined limit on the number of participants allowed. But if the two sides can put their egos and grandstanding aside, there is an opportunity for cooperation.

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          1. to mention the rest of Molly's experience- she served as Communications Director for the Indianapolis Department of Public Works and also did communications for the state. She's incredibly qualified for this role and has a real love for Indianapolis and Indiana. Best of luck to her!

          2. Shall we not demand the same scrutiny for law schools, med schools, heaven forbid, business schools, etc.? How many law school grads are servers? How many business start ups fail and how many business grads get low paying jobs because there are so few high paying positions available? Why does our legislature continue to demean public schools and give taxpayer dollars to charters and private schools, ($171 million last year), rather than investing in our community schools? We are on a course of disaster regarding our public school attitudes unless we change our thinking in a short time.

          3. I agree with the other reader's comment about the chunky tomato soup. I found myself wanting a breadstick to dip into it. It tasted more like a marinara sauce; I couldn't eat it as a soup. In general, I liked the place... but doubt that I'll frequent it once the novelty wears off.

          4. The Indiana toll road used to have some of the cleanest bathrooms you could find on the road. After the lease they went downhill quickly. While not the grossest you'll see, they hover a bit below average. Am not sure if this is indicative of the entire deal or merely a portion of it. But the goals of anyone taking over the lease will always be at odds. The fewer repairs they make, the more money they earn since they have a virtual monopoly on travel from Cleveland to Chicago. So they only comply to satisfy the rules. It's hard to hand public works over to private enterprise. The incentives are misaligned. In true competition, you'd have multiple roads, each build by different companies motivated to make theirs more attractive. Working to attract customers is very different than working to maximize profit on people who have no choice but to choose your road. Of course, we all know two roads would be even more ridiculous.

          5. The State is in a perfect position. The consortium overpaid for leasing the toll road. Good for the State. The money they paid is being used across the State to upgrade roads and bridges and employ people at at time most of the country is scrambling to fund basic repairs. Good for the State. Indiana taxpayers are no longer subsidizing the toll roads to the tune of millions a year as we had for the last 20 years because the legislature did not have the guts to raise tolls. Good for the State. If the consortium fails, they either find another operator, acceptable to the State, to buy them out or the road gets turned back over to the State and we keep the Billions. Good for the State. Pat Bauer is no longer the Majority or Minority Leader of the House. Good for the State. Anyway you look at this, the State received billions of dollars for an assett the taxpayers were subsidizing, the State does not have to pay to maintain the road for 70 years. I am having trouble seeing the downside.