Do Indiana's poor Medicaid recipients really have skin in the game?
One reason many Hoosier patients are able to pay a new HIP 2.0 fee is that they're getting help.
WASHINGTON — When Gov. Mike Pence sought federal permission to run an alternative Medicaid program in Indiana, one aspect was non-negotiable: Participants in the joint federal and state health care program for the poor would have to have “skin in the game.”
Even those with no monthly income would have to pay a minimum $1 a month toward their care, if they wanted to stay in the part of the Healthy Indiana Program (HIP 2.0) that offered better benefits and no co-payments.
Advocates for the poor worried the income-based monthly fee, which tops out at $100 a month, would prevent some low-income Hoosiers from getting care.
But as Indiana ends the first year of a three-year test of the program, Pence boasted Thursday that about 70 percent of participants are choosing to pay.
“That’s 70 percent more than some people in Washington told me it would be,” Pence said at an event Wednesday marking the one-year anniversary of the deal. “There is something to be said for the dignity of empowering low-income Hoosiers to make their own decisions about their own health care. People stand a little bit taller.”
The program — which some other states, such as Kentucky, are considering copying — still needs more time to judge its effectiveness and is being evaluated by state and federal governments.
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But one reason some of the more than 300,000 participants are able to achieve that key component of the program is they’re getting help.
Part of Reid Health’s extensive effort to get newly eligible Richmond-area residents to enroll in Medicaid included making an assessment of whether they would have trouble paying the monthly fee. If there’s any suggestion that could be a problem, the hospital works with the Wayne County trustees to cover the cost, using funds from programs for the indigent, said Chris Knight, the hospitals’ chief financial officer and vice president of finance.
“To us working people, $1 or $10 a month doesn’t sound like a lot,” Knight said. “But to some of these people, it is.”
Caitlin Priest, director of policy and communication for the advocacy group Covering Kids & Families of Indiana, said what the Richmond hospital is doing isn’t unusual.
“Everyone is really doubling back and sort of looping around to make sure that consumers can be connected to payment assistance if needed,” she said.
The state reported in its most recent federal filing that monthly payments covered by someone other than the patient were a small part of the overall program though the first nine months. Fifty-two nonprofit organizations were making contributions for 193 participants, and 102 employers were helping 108 employees.
But Priest said payment help is often “off the grid.”
“We see a lot of people who are having payments made for them more informally, either by friends, families, neighbors, community organizations,” she said. “There are so many of what we call those friendship/kinship payment networks, we may never know the true picture of what that’s actually going to look like.”
Frandal Wright, who went 27 years without health insurance before getting HIP 2.0 coverage last year, makes his $1 monthly payment at the Wal-Mart in Anderson.
Because the store is on the other side of Anderson from where he lives, Wright tries to pay as much as he can at each visit to minimize the number of times he has to make the trip. Right now, he says, he’s trying to find someone to give him a ride to make his payment and determine if he has enough money to make a lump sum payment.
“I’m a little behind now because I almost forget about it,” said Wright, 46. “I want to pay for the whole year. I’m trying to do that this time. I’ll probably give them $20 if the Lord blesses me.”
The program is open to those making up to 138 percent of the poverty level, which is $16,242 for one person.
Nearly 90 percent of the 322,485 Hoosiers participating in the program as of December had incomes below poverty.
And about half had incomes of less than 5 percent of the federal poverty level, which is less than $50 a month for a single person.
That figure jumped out at Judy Solomon, vice president for health policy at the Center on Budget and Policy Priorities, a Washington group that focuses on poverty and inequality. It’s surprising, she said, because only 8 percent of uninsured adults nationwide have incomes below 5 percent of the poverty line.
Solomon said that, because income for the poor can fluctuate month to month, it could be administratively simpler for the state to classify those below poverty into the lowest income group, charging the minimum $1 monthly fee. If that’s happening, she said, it’s important to note in the evaluation of the program because of concerns about the extra administration hurdles HIP 2.0 could require.
A spokesman for the Indiana Family and Social Services Administration, which runs HIP 2.0., said that’s not what’s happening.
“It is not unusual for a large number of eligible recipients to have $0 earned income considering that this would include the unemployed,” said spokesman James Gavin. “Other states report similar phenomena.”
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If participants below the poverty line don’t make their monthly contributions, they get transferred into “HIP Basic,” which doesn’t include vision and dental benefits. It also requires co-payments for some services, such as $4 for a doctor visit.
Those above the poverty line who don’t contribute get kicked out for six months.
The state didn’t start enforcing that provision until after the first three months, closing the accounts of 2,204 Hoosiers through October, according to the most recent statistics available.
"I don't think data for one year really gives us a true picture of what that is going to look like," Priest said.
Indiana’s permission to run the program extends for three years, during which the program will be evaluated to see whether the unique aspects are working as intended. For example, Indiana is testing whether the monthly contributions reduce patients’ use of unnecessary care, and whether reducing the required contributions if a patient seeks preventive care services cuts overall health care costs.
But no matter what the outcome of the evaluation, or of this year’s gubernatorial or presidential contests, the GOP-controlled legislature is trying to protect the monthly payments, and other unique elements of the program.
A Senate bill this session aims to make the Healthy Indiana Plan part of state code.
Pence said he wants to “enshrine it in Indiana law” to protect HIP 2.0 from any future changes.
“We will have a new administration in D.C.,” he said. “We want to make sure going forward that the state of Indiana has a solid legal framework.”
But Priest said Covering Kids & Families is concerned such a law would make it difficult to respond if problems with the program appear, or the federal government requires changes after the three-year waiver is up.
“We’re very supportive of HIP … and want to make sure the expansion stays in the future,” she said. “We want to ensure that we, as consumer advocates, still have the flexibility to suggest or pursue tweaks or improvements in real time.”
Contact Maureen Groppe at mgroppe@gannett.com or @mgroppe on Twitter.
Breakdown of HIP 2.0 participants by program, December
• Hoosiers enrolled in HIP Basic: 33 percent
• Hoosiers enrolled in HIP Plus: 67 percent
Breakdown of HIP 2.0 participants by income, December
• Incomes below 5 percent of poverty: 52.1 percent
• Incomes between 5 percent of poverty and below 101 percent of poverty: 34.5 percent
• Incomes between 101 percent and 138 percent of poverty: 13.4 percent
Source: Indiana Family and Social Service Administration