Matt Salo, executive director of the National Association of Medicaid Directors, told Galewitz, “Other states have looked at it, but the Obama administration has made it pretty clear that Indiana is going to be a test case and much evaluation will need to be done before they approve any more like it.”
Now Bevin’s office says it is looking at other states, too, as it negotiates with the U.S. Department of Health and Human Services, trying to come up with a revised program to save money, perhaps by August.
“The Indiana model is just one of many models that we are looking at for influence in crafting a plan that is specifically tailored for the needs of Kentucky,” Bevin spokeswoman Jessica Ditto said in an e-mail. “We are working closely, and in good faith, with HHS as this process moves forward and have confidence that what we offer for their consideration will be a thoughtful, deliberate and unique plan that will improve health outcomes in a sustainable manner.”
Under federal health reform, then-Gov. Steve Beshear expanded Medicaid to those in the state with incomes up to 138 percent of the federal poverty level, adding 400,000 people. The federal government pays for this expanded population through this year, but then the state will be responsible for 5 percent of the expansion, rising to the reform law’s limit of 10 percent in 2020.
Bevin has said that Kentucky’s revised program should require its members to have “skin in the game,” and that the state cannot continue to pay for the health insurance of “able-bodied adults.”
Healthy Indiana Plan
That sounds like Indiana, which has monthly fees and co-payments and refers its participants to a work program.
Even if it is just a dollar, everyone on Medicaid in Indiana pays something, whether it’s through a monthly fee or through co-payments.
The Healthy Indiana Plan has two levels, HIP Plus and HIP Basic. Both plans offer incentives for using preventive services, but HIP Plus, which requires a monthly fee, also includes dental and vision services.
HIP Plus is considered the best value and is available to everyone in the state with income below 138 percent of the federal poverty level. The consequences for not paying the required monthly fee vary by income level.
Those in HIP plus who make at or below the poverty level and fail to pay the fee are moved down to HIP Basic plan, which requires co-payments of up to $8 per service and $75 for each inpatient hospital stay. Both plans have a co-payment for using the emergency room for non-emergency reasons, $8 the first time and then $25 per visit thereafter.
HIP Basic members who make more than the poverty level are locked out of coverage for six months if they fail to make their monthly payment.
“No other program has been allowed to require health spending accounts,
much less threaten to yank coverage for a person not paying in,” Galewitz writes, paraphrasing Salo.
HIP members who are unemployed or work less than 20 hours a week are referred to available employment, work search and job training programs to help them gain employment or find better employment. This is a free and voluntary program and does not affect the receipt of benefits.
All members of HIP Plus must pay something. About half of Indiana Medicaid members have annual incomes below $600; they must pay a $1 monthly premium.
The monthly fee adjusts with income and family size. For example, a single person who makes $16,242, the maximum for expanded Medicaid, pays $27.07 per month to get HIP Plus, or $324.85 per year. A family of two could make as much as $21,983 and would pay $36.64 or $439.68 per year; and a family of four could make $33,465 and would pay $55.78, or $669.36 per year. Information comes from the eligibility calculator on the Healthy Indiana Plan website.
Is Indiana’s plan working?
Indiana health officials told Galewitz that 94 percent of those who have signed up for HIP Plus continue to pay their fees.
Michelle Stoughton, senior director of government relations for Indianapolis-based Anthem Insurance Cos., called that a success. She said nearly 75 percent of Anthem’s members on this HIP Plus have visited a dentist, and 65 percent sought vision care in the first three months of coverage. Anthem is one of three private insurers providing coverage under the Healthy Indiana Plan.
“What we heard for years . . . is that these people won’t pay and don’t have the ability to pay,” Stoughton told Galewitz. “But this has turned those arguments around and been able to show that people do want to be engaged.”
Indiana’s hospitals and doctors support the Healthy Indiana Plan, mostly because the state increased their Medicaid rates, hospitals by an average of 20 percent and doctors’ reimbursements by an average of 25 percent, Galewitz reports.
“As a result, Medicaid has gained more than 5,300 providers in the past year, and patients report few problems getting care,” he writes. But he also noted that about 2,200 members have lost coverage since it began in May 2015 because they didn’t pay their monthly fees.
Critics of Indiana’s plan worry that the monthly payments and complicated structure will keep the poor from getting care. which goes against the core goal of Medicaid expansion, Galewitz writes. In addition, some conservative groups say the program may be more expensive than traditional Medicaid, because it provides dental and vision care and pays providers more. Others say that the red tape in the plan exceeds that of any state’s Medicaid expansion.
The state had also hoped third parties would step up and help the poor pay for their monthly contributions, but this hasn’t happened, Joan Alker, executive director of the Georgetown University Center for Children and Families, told Galewitz. She said, “It’s premature for Indiana to take a victory lap.”