Wednesday, the State of Indiana submitted its proposal for the Healthy Indiana Plan 2.0 to the U.S. Department of Health and Human Services.
If approved, the Healthy Indiana Plan 2.0 (HIP 2.0) would replace traditional Medicaid for low-income able-bodied Hoosier adults. Unlike traditional Medicaid, which is government-driven, HIP 2.0 is consumer-driven. It allows participants to take greater control over their own health care decisions through POWER accounts, which are essentially health savings accounts.
I have been encouraged by the positive responses I have heard from people across Indiana since we announced HIP 2.0. As national leaders in health care innovation, Hoosiers understand that empowering people to take greater ownership of their health care choices is better than government-driven health care.
HIP 2.0 builds upon the success of our current Healthy Indiana Plan, which provides about 45,000 low-income Hoosiers with consumer-driven health care. The program has cut costs and increased health care outcomes for people whose previous health care options were either traditional Medicaid or living uninsured.
Medicaid is not only broke, it’s broken. I have consistently opposed expanding traditional Medicaid because I believe doing so would condemn more Hoosiers to substandard health care and threaten the fiscal health of our state. A study last year in Oregon showed increased emergency room usage among the Medicaid population and health outcomes that were no better than among the uninsured population. Other studies have found similar outcomes.
Medicaid is not a program we need to expand. It is a program we need to change.
The Healthy Indiana Plan is the change Medicaid needs. Seven percent fewer HIP participants use the emergency room than people in traditional Medicaid. HIP participants choose generic drugs at a higher rate than people covered by other private insurance plans, and 93 percent make contributions to their POWER accounts on time. One-third regularly ask their health care providers about the cost of services. Given what research has shown about how health savings accounts reduce health care spending, we can expect that HIP 2.0 will create savings for Indiana taxpayers over time.