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HHS Approves Medicaid Waiver to Create New Indiana Health Plan for Uninsured Hoosiers

Healthy Indiana Plan Combines Personal Responsibility and Public Dollars

WASHINGTON, Dec. 14 /PRNewswire-USNewswire/ -- HHS Secretary Mike Leavitt today announced the approval of a Medicaid waiver that will allow the state of Indiana to implement an innovative health care proposal giving approximately 120,000 low-income, uninsured residents access to critical health care services. Through the waiver, the state will be able to begin accepting applications for the new health care coverage, called the Healthy Indiana Plan (HIP).

"This is a forward-thinking plan to reduce the numbers of uninsured Indiana residents, and I applaud Governor Mitch Daniels for leading such important health care reform in the state of Indiana," Secretary Leavitt said. "It is critical that every state in this nation be thinking of creative new ways to help residents gain access to health care and, at the same time, working to make those ideas become reality. At the national level, President Bush has outlined several proposals that would give more Americans access to health insurance, but this is an excellent example of what can be done now in the states to advance this important objective."

"We're glad the Department of Health and Human Services and Office of Management and Budget gave us approval for this program in a matter of months," said Governor Daniels. "This is a big step forward that will lead to approximately 120,000 uninsured Hoosiers having the peace of mind of health insurance."

HIP was approved as a Medicaid Section 1115 demonstration project and will extend health insurance to low-income parents of children now covered by Medicaid and the State Children's Health Insurance Program (SCHIP), as well as childless adults. To be eligible for coverage, enrollees' incomes must not exceed 200 percent of the federal poverty level (FPL), or $20,420 for an individual and $41,300 for a family of four.

Enrollment in the plan will give participants access to a high-deductible health plan that includes an account patterned on the model of a health savings account. To assist with out-of-pocket costs incurred prior to the coverage threshold, both the individual and the state will make contributions to a Personal Wellness and Responsibility (POWER) account. Participant contributions to the POWER account will be set on a sliding scale based on ability to pay, but at no more than five percent of gross family income. Any funds remaining in the account at the end of the year can be rolled-over to offset the following year's contributions if age-appropriate preventative services are obtained.

No copay will be required for services except for use of an emergency room for non-emergency treatment. Benefits will include physician services, prescription drugs, home health services, in-and out-patient hospital services, mental health and substance abuse treatment, and preventive services.

The program also permits and encourages employers to contribute to their employees' POWER accounts.

"The Healthy Indiana Plan provides support for those with low-incomes but also requires them to assume some responsibility for the cost of that care. I am pleased to approve the waiver for this new program and hope other states will follow Indiana's model of combining personal responsibility with public support to help those who are truly in need gain health coverage," Secretary Leavitt said.

More information about the Healthy Indiana Plan is available on the State of Indiana's Web site at

Note: All HHS press releases, fact sheets and other press materials are available at

SOURCE U.S. Department of Health and Human Services
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