Several lawmakers want the Indiana Family and Social Services Administration to remove a policy from the Healthy Indiana Plan (HIP) that has been linked to Medicaid members losing coverage. The calls for a reassessment of POWER account contributions come as the state continues to appeal a federal ruling against the policy.
Contributions to the POWER account serve as premiums for HIP and are monthly payments required to access the better-coverage version of HIP, HIP plus. In June, a federal ruling found that several HIP policies, including these payments, violate the goals of the Medicaid Act and limit coverage.
Several lawmakers urged FSSA to remove the provision from the program entirely during a Medicaid Advisory Committee meeting on Wednesday.
Rep. Ed Clere (R-New Albany) said it is time to rethink the original policy argument for including the monthly payments, which was to encourage individual responsibility for health insurance among the population participating in the Medicaid expansion.
“Our definition of personal responsibility focuses too much on financial contributions and fails to take into account many of the realities of the insured population,” Clere said.
Clere said the General Assembly is in a position to provide its members with better tools to promote self-sufficiency and economic independence.
“Many, if not most, members of the insured population are already demonstrating personal responsibility in very significant ways,” Clere said.
Clere also pointed out that there is no data to suggest that deposits into POWER accounts lead to “improved outcomes.” In the federal ruling blocking Indiana from reinstating the monthly payments, the judge noted that there is more data showing that doing so causes people to lose their insurance coverage, which negatively impacts health outcomes.
The federal government has also raised issues with premiums in the past. In a 2023 letter to Indiana, the U.S. Department of Health and Human Services pointed to “ample evidence” that premiums “limit access to health insurance and care.” The Department of Health ultimately declined to take action against Indiana. A month before that letter, however, the Department of Health said Wisconsin could not impose premiums because they would negatively impact health insurance. It used data from Indiana to support why the premiums led to a loss of health insurance.
READ MORE: Advocates offer advice for Medicaid members dealing with impact of federal ruling on HIP
In addition to concerns about coverage, several lawmakers pointed out that there are also financial reasons for eliminating POWER account contributions.
Senator Fady Qaddoura (D-Indianapolis) said Indiana has not collected POWER account contributions for four years. The state stopped the payment requirement in 2020 as part of the continuous coverage period of the public health emergency due to COVID-19. This meant that all HIP members had access to HIP Plus without the administrative burden of the POWER account contribution.
Qaddoura said if the state can survive for years without these payments, he would urge Indiana to eliminate them altogether rather than fight to keep them.
“The government would save a lot more if it improved access to health care instead of charging fees for the POWER account,” Qaddoura said.
Senator Shelli Yoder (D-Bloomington) agreed, pointing out that HIP does not cost the state that much. She said much of the funding needed for HIP is provided by the federal government.
Federal funding for Medicaid expansion programs covers 90 percent of program costs, with 10 percent covered by non-federal funds.
However, Yoder said Indiana covers the costs of administering the program and that contributions to the POWER account increased administrative burdens.
“Trying to maintain a program that really just creates barriers for people who are eligible for health insurance creates administrative costs for us,” Yoder said.
READ MORE: HIP Plus members remain covered as Indiana appeal moves forward
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Yoder said the program actually saves the state money because it provides insurance for so many people without government funding.
“Since it seems like most of our conversations are about how we can save money on Medicaid dollars, here is a way we can actually save money and do something good for the citizens of Indiana,” Yoder said.
Rep. Chris Campbell (D-West Lafayette) said the HIP program is a good investment of federal funds.
“In the long run, we save money by not passing these additional medical costs on to families who simply cannot afford them,” Campbell said.
However, Campbell said contributions to the POWER account were a barrier for members and eliminating them would benefit the state’s Medicaid population.
“Everyone is one disease away from total annihilation,” Campbell said. “This is an opportunity for the state to invest in its people.”
The federal ruling in June overturned approval for the entire HIP program. The judge granted a limited stay Tuesday based on an agreement between the plaintiffs, Indiana and the Centers for Medicare and Medicaid Services.
Indiana has agreed not to collect POWER account contributions during the process. This means that HIP members enrolled in HIP Plus will retain their coverage and new members will also be enrolled in HIP Plus without having to make the monthly payments to maintain coverage.
Cora Steinmetz, head of Indiana’s state Medicaid program, said the state is still working on an appeal of the ruling. A lawmaker asked what the plan was if the state loses the appeal.
“If and when that happens, we will certainly have to cross that bridge and are definitely preparing for contingencies, but doing our best to maintain the status quo for the program,” Steinmetz said.
Other Medicaid programs are not affected by the ruling. Cost-sharing, including copayments and premiums, for the Children’s Health Insurance Program (CHIP) and MEDWorks resumed as planned in July.
Abigail is our health reporter. You can reach her at [email protected].
