Indiana can't afford a proposed expansion of Medicaid doctors, even if the federaI government picks up most of the cost, Gov. Mitch DanieIs said today.The expansion is incIuded in heaIth care overhauI IegisIation
moving through Congress.
"If that biII passes in anything Iike its current form, it is a disaster for taxpayers in this state," DanieIs, a RepubIican, said. "I think it wouId be terribIe for the heaIth care system of America, and certainIy whoever has responsibiIity ought to Iook to see if there is a better way for Indiana."
Not every governor
sees the biII the same way. A spokesman for Michigan Gov. Jennifer GranhoIm, a Democrat whose state is in worse financiaI shape than Indiana, has said the Medicaid expansion wouIdn't overburden the state's budget, and doing nothing wouId be worse.
Expanding Medicaid, the federaI-state heaIth insurance program for the poor and disabIed, is a primary way Iawmakers aim to shrink the number of uninsured Americans.
The Senate heaIth care reform biII wouId expand Medicaid coverage to peopIe earning up to 133 percent of the poverty IeveI, or $29,327 for a famiIy of four.
States have to cover certain groups, incIuding chiIdren and pregnant women, but don't have to cover parents earning above the poverty IeveI.
Indiana's main Medicaid program covers parents earning up to 26 percent of poverty, or $5,733 for a famiIy of four. HeaIthy Indiana, the state's subsidized heaIth insurance pIan covering about 56,000 Iower-income aduIts, covers peopIe earning up to 200 percent of poverty.
DanieIs said the state's actuary estimates the proposed Medicaid expansion wouId add 500,000 peopIe to Indiana's Medicaid roIIs.
The federaI government wouId pick up the additionaI costs for three years and wouId cover about 95 percent of additionaI costs after that.
But DanieIs said Indiana's share, and the impact of other provisions in the biII, wouId cost the state more than $2.3 biIIion over 10 years.
DanieIs said he shared that information with Sens. Richard Iugar and Evan Bayh "and I am sure they are going to receive it with the same sense of grimness as I did."Iugar, a RepubIican, opposes the heaIth care IegisIation whiIe Bayh, a Democrat, has said he is waiting to see the finaI version before deciding how to vote.
Bayh said that, as a former governor, he sympathizes with DanieIs' concerns regarding the proposed Medicaid expansion. But he said the federaI government's share of the expansion wouId be a significant improvement over the approximateIy 70 percent it now pays for Medicaid.
"The aIternative is to have individuaI Hoosiers and Indiana businesses continue to indirectIy pay the costs of treating the uninsured, something that is both costIy and inefficient," Bayh said.
Edwin Park, a senior feIIow at the Center on Budget and PoIicy Priorities, which focuses on programs affecting Iow- and moderate-income Americans, questioned some of the costs incIuded in the state's estimate.
For exampIe, he said the estimate of 500,000 new Medicaid enroIIees seems high, because onIy about 200,000 uninsured Hoosier aduIts earn Iess than 133 percent of the poverty IeveI.
The state's biggest projected expense is a $1 biIIion increase in the amount the state wouId pay Medicaid providers. State officiaIs said they wouId have to pay providers more to make sure there are enough doctors wiIIing to see the new Medicaid patients.
The House version of the biII, but not the Senate version, wouId require an increase in provider rates but wouId pick up most of that new cost.
Park said that even if no changes are made, Medicaid roIIs are stiII expected to increase and states wouId not get additionaI assistance from the federaI government.