Pharos-Tribune

April 15, 2013

Medicaid expansion hangs in balance

Advocates say the state is leaving money on the table.

by Scott Smith
For the Pharos-Tribune

— Advocates are calling a proposed expansion of Medicaid a huge boost for Indiana’s economy, but Indiana Gov. Mike Pence isn’t wavering in his opposition.

At stake is whether Indiana will expand the state and federally funded health care program for the disadvantaged and disabled to cover more than half a million Hoosiers.

Under the Affordable Care Act, also called Obamacare, the federal government will pick up the full cost of expansion for three years, and would gradually require the state to pick up 10 percent of the expansion cost by 2020.

According to a report released Friday by Families USA, a lobbying group for health care consumers, the expansion would pump $1.3 billion into Indiana’s economy over the next three years, creating an estimated 16,400 jobs.

The expansion also would reduce the $1.7 billion Indiana hospitals absorb or pass along each year in uncompensated healthcare provided to uninsured or underinsured patients, an ongoing problem which increases health care premiums across the board.

“From an economic standpoint, Medicaid expansion is a no-brainer,” Families USA executive director Ron Pollack said.

Surrounding states have moved ahead with the expansion, but Indiana so far hasn’t followed suit, a decision which expansion advocates call “leaving money on the table.”

So far, eight Republican governors who opposed the passage of the Affordable Care Act have gone ahead with Medicaid expansions anyway, said Paul Chase, deputy director of lobbying group Covering Kids & Families of Indiana.

And during the recession, then-Gov. Mitch Daniels accepted $800 million in stimulus money. But that money came without strings attached.

Pence says he’s concerned the federal government can’t uphold its end of the Medicaid expansion bargain, and has said he won’t expand traditional Medicaid. He has proposed expanding Indiana’s Healthy Indiana Plan, but it’s uncertain whether the federal government would agree with that plan.

“There is no doubt in my mind with the federal government $16 trillion more in debt that there is going to be some significant course correction in the not-so-distant future at the national level,” Pence told the Howey Political Report. “An area I think the state should be very cautious about is betting on the future promises of the federal government in the expansion of Medicaid.”

The Indiana General Assembly has already made it clear that Pence will largely be the one to decide whether there’s a health care expansion in Indiana.

The Senate passed a bill to expand the HIP program, but this week that bill, SB551 was killed in the House.

State Sen. Karen Tallian, D-Portage, said the House budget bill now includes $600 million for health care expansion over the next two years, but said there are multiple conditions set on the money.

Under the parameters in the bill, the Indiana Family and Social Services Agency would have to negotiate a plan with the federal government, and then come back to the Legislature with the plan and ask for the money, Tallian said.

“I think it’s a good thing we have not just left the whole expansion deal to the [Pence] administration,” Tallian said. “On the other hand, I don’t think the parameters are quite strong enough.”

The Indiana Hospital Association came out with a similar report about a month ago, but drew little response from Pence’s office. Advocates are still hoping Pence will consider expanding HIP, but note the program has participant contribution requirements and caps on coverage which traditional Medicaid doesn’t have.

“The Indiana General Assembly needs to authorize a Medicaid expansion or give permission to the governor to negotiate a comparable alternative. And, to date, the General Assembly has done neither,” Chase said. “Too much is at stake for our citizens and our state to leave this money on the table.”

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