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Waiver Extension for Healthy Indiana Plan 2.0 Waiver Extension for Healthy Indiana Plan 2.0

Waiver Extension for Healthy Indiana Plan 2.0

Indiana has requested an extension of the Section 1115 demonstration waiver for Indiana's Healthy Indiana Plan 2.0 ("HIP 2.0"). Indiana originally used HIP 2.0 to implement Medicaid expansion in Indiana, including a provision under which most adults with income from 101 to 138% of the federal poverty level pay amounts into a Personal Wellness and Responsibility ("POWER") account.

In its amended waiver application, the state of Indiana requested certain key changes to HIP 2.0, which CMS approved, including the following:
  • Allows an increase in premiums for smokers
  • Conditions Medicaid eligibility for many adults on meeting a work requirement beginning in 2019
  • Allows disenrollment for failure to complete the eligibility renewal process
  • Changes premiums to a tiered structure instead of 2% of income
Indiana was the second state to be approved by CMS to include a work requirement as a condition for Medicaid eligibility. CMS approved Kentucky's work requirement in January 2018. The addition of a work requirement to HIP 2.0 has attracted significant attention since the HIP 2.0 waiver extension was approved.
Under the approved work requirement, most adults must meet the requirement in at least 8 of 12 months as a condition of eligibility as of 2019. The required participation of hours is as follows:
  • 1-6 months with Medicaid coverage – no weekly hour requirement
  • 7-9 months with Medicaid coverage – 5 hours per week
  • 10-12 months with Medicaid coverage – 10 hours per week
  • 13-18 months with Medicaid coverage – 15 hours per week
  • 18+ months with Medicaid coverage – 20 hours per week
Excess hours in a given week can be applied to another week in the same month. Applicable individuals can document their compliance with the hour requirement several ways, including online, by phone, by mail, in person, and other commonly available electronic means. The state can also develop a self-attestation.
Several different activities can satisfy the work requirement, including:
  • Employment
  • Job searches
  • Education, including accredited homeschooling, education related to employment, vocational training, and education
  • Job skills
  • Community training public services
  • Volunteer work
  • Caregiving for non-dependent relative or other individuals with chronic disabling health condition
There are also several ways an individual can be exempt from a work requirement for a given month, including:
  • Full- or part-time students
  • Pregnant
  • Primary caregiver of dependent child below mandatory education age or dependent with a disability
  • Medically frail
  • Documented temporary illness or disability
  • In active substance use disorder treatment
  • Over age of 59
  • Eligible for good cause exemption, including persons with disabilities and victims of domestic violence.
Work requirement hours for each applicable Medicaid recipient will be determined in December each year. Individuals who are non-exempt and who do not comply with the work requirement will be suspended as of January 1. Unless a beneficiary is able to reactivate his or her eligibility, he or she will remain suspended until the individual's eligibility redetermination date. If the beneficiary does not meet the work requirement or is not exempt as of the eligibility redetermination date, the beneficiary’s eligibility will be denied and his or her enrollment in the demonstration terminated. For individuals who are suspended, there are a variety of ways they can have eligibility re-established, including completing one month of required hours and submitting this information to the state.

The work requirement is a significant change to the Medicaid program in Indiana; however, given the various activities that qualify and the exemptions that apply, as well as the significant number of details the state still needs to work through, it is unclear exactly how much impact the new work requirement will have. All interested parties will have to monitor developments over the next few years.

For more information on this matter, please contact Kevin Woodhouse or Taryn Stone.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.
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