Federal officials OK extension of original Healthy Indiana Plan while HIP 2.0 still undecided

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INDIANAPOLIS — Indiana's Medicaid-covered health saving accounts for low-income residents will be renewed through next year, Gov. Mike Pence's office announced Monday.

The federal Centers for Medicaid and Medicare Services told the state it would extend of the Healthy Indiana Plan, or HIP, on Friday evening, Pence's office said. As of Oct. 1, HIP enrolled nearly 61,000 low-income Indiana residents.

The approval does not affect Pence's request to expand Medicaid coverage under a proposed similar program dubbed HIP 2.0. The CMS has not indicated whether it will approve that plan, which Pence has said could cover an additional 350,000 low-income residents.

CMS Director Cindy Mann told Indiana Medicaid Director Joseph Moser in a letter that the agency approved the one-year extension to avoid disrupting Medicaid coverage while the state and CMS continue to negotiate over HIP 2.0.

HIP now is set to expire on Dec. 31, 2015, "but may end earlier by agreement of the state and CMS, should the state transition to HIP 2.0 before that time," Mann wrote.

HIP is available to adults who earn less than the federal poverty level and who otherwise don't qualify for Medicaid. HIP 2.0, which the state submitted for federal approval in July, would be open to all non-disabled adults earning less than 138 percent of the federal poverty level.

Health care advocates and industry lobbyists asked federal officials in late September for speedy approval of HIP 2.0. A week later, Pence and President Barack Obama had a brief, face-to-face chat about the plan during Obama's visit to southwestern Indiana.

If HIP 2.0 is approved, the federal government would pick up the majority of the multibillion-dollar expansion of Medicaid coverage in Indiana.

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