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June 22, 2014

LETTERS: New Healthy Indiana Plan best option; North End needs sidewalks

New Healthy Indiana Plan our best option

Some state-run health care exchanges — the brainchild of the Affordable Care Act (ACA) — have gotten off to a rocky start, to the point that they are turning to the federal government to pick up the pieces. Indiana’s decision to try to expand the already existing Healthy Indiana Plan (HIP) in lieu of an exchange seems a more prudent choice every day.

Last month, Gov. Pence outlined HIP 2.0, which would provide two alternatives to traditional Medicaid by offering a high deductible health plan along with a power account (similar to a health savings account). The Indiana Chamber has reviewed HIP 2.0 and urged the Centers for Medicare & Medicaid Services (CMS) to give it the needed approval.

Indiana’s HIP provides reimbursement to health care providers at Medicare rates. This practice is particularly appreciated by companies and their workers. Reimbursement rates for Medicaid typically result in health care providers being put in position to recover such losses by increasing prices for private-sector employers and their employees through cost shifting. Any attempt to lessen that cost shift is viewed as a positive and productive attribute of the HIP program and its successor HIP 2.0. Furthermore, higher reimbursement rates to providers improves access to care for enrollees. This is especially significant with the increased demand and limited supply that will be placed upon our health care system as a result of the ACA’s individual mandate.

An intriguing component in HIP 2.0 is the new optional defined contribution premium assistance program called “HIP Employer Benefit Link” that would be implemented in year two of the HIP 2.0 program. This could turn out to be a method to allow the working poor to maintain an employer-sponsored health benefit. If structured properly, it may even promote small employers that do not provide health insurance benefits to do so in the future, with the understanding that the employer will contribute 50 percent to the cost of the plan. Maintaining and encouraging private-sector health insurance whenever possible (especially employer-sponsored coverage) is a better option than any government plan.

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