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Indiana can no longer charge monthly payments for HIP after federal ruling

A wall-mounted oxygen machine in a hospital.
The lawsuit challenged several policies that “threaten” coverage and access.

Indiana will no longer be able to require monthly payments for one of its Medicaid programs after a 2020 approval was vacated by a federal judge. The ruling stems from a lawsuit filed against the federal government and said a number of policies within the Healthy Indiana Plan, or HIP, restrict access to coverage and services.

The lawsuit challenged several policies that “threaten” coverage and access.

This includes POWER account contributions, which are monthly payments required to access the version of HIP with better coverage, HIP Plus. Nonpayment could result in being knocked down to the basic plan or losing coverage entirely.

The U.S. Department of Health and Human Services approved the renewal of the plan in 2020.

These payments were paused for Medicaid members at the beginning of the COVID-19 pandemic. As the state completed its “return to normal” or Medicaid unwinding process following the end of the COVID-19 public health emergency, the requirement was set to restart in July.

The policies highlighted in the lawsuit also included the state’s ability to deny retroactive coverage. If a Medicaid member is kicked out of a program, they have a “reconsideration period.” In most programs, when someone regains eligibility during that period they get retroactive coverage – meaning they don’t have to wait until the next month to be fully covered. For HIP, the state had been allowed to deny that coverage.

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Last year, advocates sent a letter to the Centers for Medicare and Medicaid Services requesting it remove Indiana’s ability to continue these policies. In December, CMS decided it would not take action. It said doing so would be too disruptive during the Medicaid unwinding process, but it reserved the right to take action in the future.

The judge in the case concluded HHS failed to promote the objectives of the Medicaid Act by approving the program in 2020 and by denying the request in 2023.

The ruling said the government “evidently” doesn’t believe that states can’t adjust to changes in the midst of the Medicaid unwinding.

“In fact, just one month before issuing the 2023 letter here, the Secretary [of HHS] withdrew Wisconsin’s authority to impose premiums in the midst of the same unwinding process,” the judge said.

Cost-sharing is expected to restart in July for Hoosiers enrolled in the Children's Health Insurance Program (CHIP) and the MEDWorks program.

The Indiana Family and Social Services Administration said it is reviewing the ruling.

Abigail is our health reporter. Contact them at aruhman@wboi.org.

Abigail Ruhman covers statewide health issues. Previously, they were a reporter for KBIA, the public radio station in Columbia, Missouri. Ruhman graduated from the University of Missouri School of Journalism.