The Obama administration approved Indiana’s Medicaid expansion plan Tuesday, making it the latest Republican-led state to extend government-run health coverage to hundreds of thousands of poor residents while vowing to hew to conservative principles.
Gov. Mike Pence said roughly 350,000 eligible residents can apply now for coverage that starts Feb. 1, under a plan he said won’t end up costing state taxpayers anything, and will push out-of-work beneficiaries to try to find jobs.
Healthy Indiana 2.0 also requires enrollees to contribute to a specific type of health savings account, and could cancel their Medicaid coverage if they don’t buy in. Mr. Pence called it a market-driven alternative that was different from what other states did.
The move caps seven months of talks between the Pence administration and the Health and Human Services Department, which had to approve Indiana’s plan before releasing new funding that Obamacare gives to states that agree to expand their Medicaid programs to those making up to 138 percent of the federal poverty level.
“This has been a long process, but real reform takes work,” said Mr. Pence, who is said to be weighing a 2016 presidential bid.
The Obama administration hailed the move as another win for Obamacare.
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“With today’s agreement, Indiana will become the 28th state, plus the District of Columbia, to expand Medicaid under the Affordable Care Act,” said Marilyn Tavenner, administrator for the Centers for Medicare and Medicaid Services.
Hours later, the administration said 9.5 million Americans had selected coverage through the law’s insurance exchanges with a month to go before the Feb. 15. That means HHS likely will far exceed its modest 2015 goal of 9.1 million effectuated enrollees, even after a share of customers lose their coverage due to nonpayment.
The agency said 58 percent of customers had re-upped in exchange plans for 2015, while the rest were first-time enrollees.
“We still have a lot of work to do before February 15, but are encouraged by the strong interest we’ve seen so far,” HHS Secretary Sylvia Mathews Burwell said.
The exchanges are one of the ways Obamacare is pushing to cover more people. The law also requires individuals to obtain coverage or face a tax penalty, demands businesses provide insurance or face penalties and asks states to expand their Medicaid programs.
To get states’ cooperation on Medicaid, the federal government is paying for 100 percent of the expansion through 2016, with the reimbursement rate falling to 90 percent by 2020.
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Republicans leaders such as Mr. Pence, who loathe Obamacare but still want to insure their poor and reap the economic benefits of expansion, are seeking conservative reforms to make expansion more palatable.
Indiana’s program will not require new state spending or taxes when the federal contribution begins to ebb in 2017. Instead, it will be financed by cigarette-tax revenue and an assessment on hospitals that takes effect in 2017.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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