Justice Vaughn’s medical care expenses are covered by the Healthy Indiana Plan. “SB 2 is going to impact real people,” Vaughn said. “It's not just numbers. It's not just some hole that we need to fill in terms of funding. It is real people's lives at stake, including my own.” (Jenna Watson/Mirror Indy)
Justice Vaughn laid on the floor of her apartment, her heart pounding. It was a Monday in January, and she was terrified of losing her health care.
“I just want the ability to go to the doctor,” Vaughn told Mirror Indy.
The 24-year-old law student’s phone was by her side, buzzing with updates about President Donald Trump’s federal funding freeze. Earlier in the month, she had testified against Senate Bill 2, an Indiana Senate Republican priority bill to place new restrictions on who can access the state’s expanded Medicaid program.
That program, called the Healthy Indiana Plan, covered the costs of Vaughn’s four emergency room visits last year when her lungs were infected and her heart wouldn’t stop beating backward.
Vaughn has health insurance through HIP because it provides coverage to low-income adults who are not eligible for other Medicaid programs. Vaughn, who is studying at Indiana University Indianapolis and interning for the legal advocacy group Indiana Justice Project, earns less than $20,793 a year.
Senate Bill 2, though, would cap the HIP program at 500,000 members — kicking an estimated 250,000 people off health care coverage in the process. It would also require people to work at least 20 hours a week to stay on HIP, with some exceptions.
State Sen. Ryan Mishler, R-Mishawaka, who authored the bill, is the Senate’s top budget writer. He emphasized controlling state spending after Indiana’s billion dollar Medicaid shortfall.
When lawmakers wrote the state budget in April 2023, there was a forecasting error in the estimates of Medicaid costs, driven, in part, by an unanticipated need for more long-term care services for the elderly.
“If we do nothing, many of our other programs are going to suffer,” Mishler said Feb. 18 on the Senate floor.
When asked about the proposed cuts in the bill, Gov. Mike Braun said in a March 3 statement he was ready to work with Mishler to “address the ballooning costs of Medicaid expenses.”
Cutting access to HIP, however, is unlikely to make a dent in the state’s Medicaid spending. That’s because 90% of the program is funded by the federal government; the other 10% comes from taxes on Indiana hospitals and tobacco products.
“The Healthy Indiana Plan did not cause the billion dollar shortfall we experienced,” said Tracey Hutchings-Goetz, the policy director for Hoosier Action, a Medicaid advocacy group opposed to the bill.
The bill’s fiscal note does not explain how much money the state would save through these cuts or which programs the money could be used to fund instead. It is also unclear which 250,000 Hoosiers would lose coverage or what criteria would be used to make that decision.
That’s why Vaughn was on the ground in her apartment, clutching her heart and trying to breathe. She imagined being one of the newly uninsured, watching medical debt crush her future.
“I don’t think politicians are targeting the right group of people to fill the hole in their pockets,” she said.
‘Placing bets on my health’
People on HIP work as barbers, waitresses and cashiers. And they might take your portrait.
Todd Fuqua, 56, runs a photography business downtown. Without HIP, they couldn’t afford treatment and medications for HIV.
As Senate Bill 2 moves through the legislature, they’re afraid of going back to living with serious complications from the virus.
“It feels like politicians are just placing bets on my health and well-being,” Fuqua said. “They don’t really have a thought out plan.”
Health coverage isn’t the only thing on the chopping block. Advocates say if the cuts pass, Indiana could lose about $3.5 billion in federal match dollars in the next two years.
That money bolsters the state’s economy and creates health care jobs, said Hutchings-Goetz from Hoosier Action.
“If we kick people off the program, we don’t get that federal money anymore,” she said.
Mirror Indy reached out for comment from the bill’s author. Mishler, through a spokesperson, said he was unavailable for an interview about Senate Bill 2 because of his schedule at the Statehouse.
He has previously defended the proposed cuts, suggesting that people who would be removed from HIP are “able-bodied” and need to work or enroll in a different Medicaid program. During a Senate Appropriations Meeting on Jan. 16, he referenced traditional Medicaid and the health insurance marketplace as alternatives.
But advocates say those aren’t viable options for Hoosiers on HIP.
“People that lose this coverage are not going to get it in other places,” said Adam Mueller, the executive director of the Indiana Justice Project. “Uninsured rates will go up.”
The group is just one of many opposed to the legislation. National health organizations, including the American Cancer Society, testified against the bill on Jan. 16.
“We didn’t do this bill to throw people off of health care,” Mishler said to them, in part, during the Senate Appropriations Committee meeting. “We want to make sure everybody is eligible and it is not taken away from people that actually need it the most.”
That didn’t make Leland Watson feel better.
The 34-year-old from the east side has neuropathy in his hands and legs, a severe nut allergy and spinal injuries that prevent him from working. He is relying on HIP while he applies for disability benefits through Social Security — a process that’s already taken a year.
Now, Watson is having nightmares about losing his health care. He wakes up afraid that he’s already lost coverage for his prescriptions, including one that keeps the pain in his hands and feet at bay.
“If I don’t have my medicine, I can’t walk,” Watson said. “I would give it about a week until I have to go to the ER.”
Work requirements are ‘red tape’
Senate Bill 2 would enforce work requirements — something Indiana has tried before.
Gov. Mitch Daniels’ administration started HIP in 2007 to provide medical coverage for low-income Hoosiers ages 19 to 64. In 2015, Gov. Mike Pence’s administration received a waiver to funnel the federal expansion of Medicaid through HIP in Indiana. The waiver allowed Indiana to enforce a work requirement, something that traditionally is not allowed with Medicaid.
Keeping the work requirement has been difficult for the state. First, it was put on hold after being challenged in court. Then in 2021, President Biden’s administration rescinded approval. And last summer, a federal judge in Washington, D.C., found that parts of HIP did not comply with Medicaid law, though the case is on appeal.
Some Republicans think the Trump administration will be more amenable to the work requirement.
To keep receiving health care coverage under Senate Bill 2, people on HIP would have to prove they are working at least 20 hours a week. The state Family and Social Services Administration would also check people’s eligibility for Medicaid every quarter, instead of once a year.
“This promotes good behavior,” Mishler told fellow lawmakers on Feb. 17.
Except, more than 70% of people on HIP already work, according to a study published in February by KFF, a nonpartisan health policy research group based in California.
The state government would have to spend money and time tracking each person’s work status, said Mueller of the Indiana Justice Project, which opposes the bill.
That includes people who would qualify for exceptions to the work requirement. Some outlined in the bill are pregnant people, anyone deemed medically unfit for work and those who volunteer for 20 hours a week instead.
“If there’s confusion or disagreements or errors happen,” Mueller said, “people are going to lose coverage.”
Leland Watson, who receives health insurance through HIP, said he already lost coverage accidentally in 2021 due to a processing error with his application. He was left rationing medications for a month.
“What they want to do now is add an entire roll of red tape,” Watson said. “Just to make it harder.”
Ian Butcher, 28, said lawmakers should stop focusing on money and look at how the program helps everyday people. He has severe depression and obsessive-compulsive disorder, which make it difficult to keep a job.
“I want politicians to know putting in work requirements makes me scared for the future,” Butcher told Mirror Indy. “It makes me worried I’ll hurt myself.”
HIP covers the cost of medications and therapy — things that were not available to him before the program. With enough time and treatment, Butcher hopes to be able to work again one day.
Now, that dream might be in jeopardy, along with his health insurance.
“Taking away my crutch is going to make me limp longer,” he said.
What’s next?
Senate Bill 2 has a few more steps before it reaches Braun’s desk.
It could be amended in the Indiana House, where it’s now under consideration. The legislation will be heard next in the House Public Health Committee, which is chaired by Rep. Brad Barrett, R-Richmond, who is already a sponsor.
The fate of the program is also in the hands of Congress. House Republicans passed a budget proposal in February that could make steep cuts to Medicaid.
If federal funding for HIP drops below 90%, the state has a trigger law that would likely end the current program.
Mirror Indy reporter Mary Claire Molloy covers health. Reach her at 317-721-7648 or email maryclaire.molloy@mirrorindy.org. Follow her on X @mcmolloy7.
This article first appeared on Mirror Indy and is republished here under a Creative Commons license.
