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Updated 11/16/12 8 a.m.
HHS Pushes Back Deadline
The Health and Human Services Department announced late Thursday it was extending the first deadline for the Affordable Care Act. State’s originally had to tell the federal government by Friday whether they would set up their own health care exchanges. The federal government has extended that deadline to Dec. 14.
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The Affordable Care Act requires states to decide whether to set up their own health care exchange or let the federal government do it. It also gives states the option to expand their Medicaid coverage. Indiana has so far taken few steps to implement the federal law.
Health Care Exchange: State, Federal or Hybrid
The most pressing issue is setting up a health care exchange.
Seema Verma is the state’s health care reform lead. She says exchanges are basically online databases where patients would be able to shop for the best health insurance.
“Think of it as an Expedia or an Orbitz to buy health insurance, so it’s a place where you can go to compare cost and quality and then make your purchasing decision,” Verma said.
States must declare by Friday if they want to set up their own exchange. If they want to partner with the federal government, they must decide that by February or else the federal government will step in.
During the campaign, Governor-elect Mike Pence said he did not want to set up an exchange. At a press conference after election day, Pence maintained that view.
“At the governor’s invitation I think we provided a very thoughtful recommendation to this administration,” Pence said. “We recommend strongly against Indiana setting up a state-based exchange.”
Besides the exchange, there’s also the Medicaid expansion. Indiana hired Milliman Consulting to estimate how much Medicaid expansion would cost. Its report said the Medicaid expansion could cost Indiana more than $1 billion over seven years if it extends coverage to anyone whose income is at or below the federal poverty limit.
But Milliman Consulting actuary Robert Damler says if the state does not expand its offerings, costs would still go up about $600 million because of changes the Affordable Care Act made to Medicaid on a federal level.
“There will be promotion of this, we anticipate by the federal government and health insurance exchanges and by advocacy groups,” Damler said. “Individuals will hear about the need to have health insurance and the mandate to have health insurance. And while that mandate may or may not apply to them, they will present themselves to identify if they are eligible or not.”
The Supreme Court decision made the expansion of Medicaid optional and there is no set timeline for states to expand Medicaid. But there may be benefits to implementing it earlier rather than later.
“The first three years are 100 percent federally matched,” Damler said. ” However that is actually not defined as the first three years from when the state decides to expand. Actually the first three years are calendar year 2014, 2015, 2016.”
So if states wait to expand, they will not receive as much federal funding as they would have if they expanded right away.
Dr. Rob Stone is the founder of Hoosiers for Common Sense Health Care. He says even though some doctors may not want to accept more Medicaid patients, it’s too good of a deal for the state to pass up.
“It’s still been clearly proven to be better than no coverage at all. It helps people get better care,” Stone said. “It helps people be healthier. It improves the health of our workforce in Indiana. It has much broader economic implications than just the fact that it would be federal money coming into the state that we wouldn’t get otherwise.”
Indiana is considering alternatives. It has its own program called the Healthy Indiana Plan that provides additional subsidies to low-income Hoosiers. However, they also have to pay into the plan. That means it tends to cost the state less money than traditional Medicaid.
Indiana has appealed to the federal government to ask if an expanded state plan would qualify for the same federal assistance as Medicaid expansion.
The federal government has not yet provided an answer.