232,000 Hoosiers hang in balance in Pence-Obama wrangling over Medicaid

June 10, 2013
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There is an interesting new blog post over at Health Affairs, which estimates the number of uninsured residents in each state before and after Obamacare—including the impact for each state if it does or does not expand its Medicaid program as called for by Obamacare.

In Indiana, that decision rests entirely on whether Gov. Mike Pence can convince the Obama administration to allow Indiana to use its Healthy Indiana Plan to expand Medicaid, rather than the traditional Medicaid programs. Pence thinks his plan can save the state money by helping low-income Hoosiers be better consumers of health care, although many dispute this notion.

The fate of 232,000 Hoosiers hangs on those negotiations, according to the estimates from researchers at Harvard University and the City University of New York, who authored the blog post.

Here’s how their math breaks down. There were 764,000 uninsured Hoosiers before the implementation of Obamacare, also known as the Patient Protection and Affordable Care Act.

That number is projected to fall to 623,000 after Obamacare’s subsidies to help low- and moderate-income households buy insurance kick in next year. Those subsidies, funded by various tax hikes, will help families making 100 percent to 400 percent of the federal poverty limit buy health insurance via new exchanges, or online marketplaces.

The federal poverty limit for a family of four is currently $23,550.

But those subsidies will not apply to families making less than the federal poverty limit. And in Indiana, most adults (other than moms with kids) are not covered by Medicaid unless their household incomes are a mere 25 percent of the federal poverty limit, or less than $6,000 for a family of four.

So the people with household incomes between about $5,900 and $23,500 will have only the options they currently have. And those options leave many of them uninsured.

Of course, another part of Obamacare will now require those individuals to obtain health insurance—a requirement they do not face now.

But the impact of this “individual mandate” will be muted by two factors. First, Obamacare includes a hardship exemption for families who would spend more than 8 percent of their income on even the cheapest health insurance available.

Second, the penalties for not buying health insurance start out extremely small—just $95 for an individual in the first year—and the bill provides no additional funding for the Internal Revenue Service to enforce compliance with the mandate.

Those nuances were supposed to be incorporated into a model developed by the Congressional Budget Office, which the Harvard and CUNY researchers used to make their predictions.

If Indiana does expand its Medicaid program to cover families with incomes up to 138 percent of the federal poverty limit—as called for by the Obamacare law—the researchers predict the number of uninsured Hoosiers would shrink to 391,000.

The reason Indiana has a choice in the matter is that the U.S. Supreme Court declared a year ago that the Obama administration could not force states to expand their Medicaid programs by threatening to withhold all Medicaid funding if they did not.

Viewed in percentage terms, nearly 12 percent of Indiana’s 6.5 million people are currently uninsured. The onset of Obamacare, including an expansion of Medicaid coverage, would cut that number by nearly half, to 6 percent.

But if Indiana does not expand Medicaid coverage, its uninsured population will remain at nearly 10 percent.

It’s that difference of 4 percentage points that the Pence and Obama teams must weigh. Neither side likes the other’s preferred policy, but they’ll have to decide whether insurance coverage for 232,000 is worth a compromise or not.

  • Pence
    I have to say that I find it appalling that out governor is risking people's lives and financial futures just to win a stupid political debate. The federal government wants to give you money to implement Obamacare. Take the money and shut up!
    • Really- take the money and shut up
      That would be my money in the end that pays for this. I work hard for my money and my health insurance- you are more then welcome to pay all of your money but as for ME AND MOST HARDWORKING PEOPLE we appreciate Mr Pencce standing up to Obama and not taking our money!
    • Obamacare
      I believe the feds would pay for most of the expansion, but the state would still have to come up with additional money to fund its part of it. So Mr. Pence is actually trying to save taxpayers in the state money.
    • Saving Money For Who?
      Mr. Pence may be trying to save money for taxpayers, but which taxpayers is he helping? He's only concerned with the wealthy taxpayers. Look at the two other comments here. Yeah, you may want to keep more of your money, but would you really mind if a little bit of your money went to help others who cannot afford healthcare? Are Hoosiers (and Americans in general) really so selfish and materialistic that we can't set aside any of our money to make sure people have the ability to see a doctor? If that's the case, we live in a really sad world.
      • Dont mind helping out
        I absolutely dont mind helping out those in need. I spend time at food pantry's and donate to local charities. The sickest of the sick and the poorest of the poor and our soldiers who have fought for our country are the ones need we to help. I work in the medical field, I see who takes advantange of the government healthcare provided to them and how they take no responsibility for their care. They feed their kids junk food because they are to lazy to fix them a good meal and food stamp money allows them to run to the 7/11 to get milk at $4.00 a gallon..they run to the emergency room because it is conventient not even concerned with the medical bills they just incurred for the tax payer, then never follow up with a family doctor. There people are the ones I no longer want to help! They take every thing for granted because they are like a spoiled child! HIP requires them to do this with small copays for office visits and larger copays for ER visits. It offers incentives for taking care of themselves. It requires them to set back a small amount of money for some of the healthcare costs they could need for the year. It is about teaching them responsibilty. The sad part of this world is that people take others peoples money and hard work for granted and then try to act like we are the bad ones when we say enough is enough!
      • morality
        Let's put this in terms perhaps Mike Pence can understand. For the state to turn it's back on the poor in this manner is uncharitable & un-Christian: Prov. 29:7. The righteous is concerned for the rights of the poor; the wicked does not understand such concern. 1 John 3:17. But whoever has the world's goods, and beholds his brother in need and closes his heart against him, how does the love of God abide in him? There are money-lenders in the temple, my friends.
        • Where is the bible verse that says...
          I dont see the bible verse posted that says is truly right and just for you to work hard every day so that Joe Schmoe can sit on their very capable butt while you pay for all there things they "need". It isnt just about the money it is about their lack of morals not mine. They are the ones taking from the true poor and sick.
        • Ashamed.
          We should be ashamed to be ranked 37th in health care in the world by the World Health Organization and be the only country in the world with millions of folks uninsured.

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