HIP model has potential

State Medicaid programs face a number of pressing issues over the next two years, include policy changes, growing demand, and, of course, financing. Experts agree that even with federal matching funds states cannot realistically cover all their uninsured residents, nor can they guarantee affordable coverage. A large-scale solution is necessary, but reforms will take years to develop.

The Healthy Indiana Plan (HIP), which began enrolling beneficiaries in January 2008, is the first state model that has a consumer-driven look to it. It includes a high-deductible health plan and health savings account offered to low-income adults who wouldn't otherwise qualify for Medicaid. HIP is generating interest because:

"There was an unforeseen, significant demand for Healthy Indiana," says Charlotte MacBeth, president of MDwise, which covers more than 10,000 HIP members. "A lot of states have medically needy categories, but Indiana has never adopted a medically needy program. There was a population of adults who needed medical care who were probably the first ones to sign up. The state also did an excellent job promoting the program, so that contributed to the initial growth. But it's my understanding the growth hasn't slowed down. It's continuing to exceed expectations."

New Population

Pent-up demand for HIP is staggering. State officials predict the program will eventually enroll a total of 120,000 adults earning less than 200% of the federal poverty level. Any low-income adult without access to an employer plan who has been uninsured for six months is eligible.

Based on documented demand, it's almost certain HIP will reach the cap in the first quarter of 2009. At that point, eligible applicants will be turned away.