INDIANAPOLIS — In 2013, then-Indiana Gov. Mike Pence faced a policy and political quandary. Should the state take federal dollars to expand health insurance via Medicaid and the Affordable Care Act, aka Obamacare? Many Republican governors and legislatures rejected these funds, and their state’s health outcomes are poor.
Gov. Pence described it in political terms as the “gift of a baby elephant” from the federal government’s Affordable Care Act. “Where the government says, ‘Here’s a baby elephant. We’ll agree to pay for the hay for the next five years,’” Pence said. “Washington is broke, with more than $16 trillion in national debt.”
Pence, at the ardent behest of Indiana health care providers, decided to accept Medicaid dollars via Obamacare, setting up the Healthy Indiana Plan 2.0 more than a decade ago. But in doing so, the General Assembly opted to include a “trigger” clause should enrollment crest too high. And Indiana’s health outcomes remain poor, ranked 35th nationally in 2022. Our life expectancy at 75 years is two years below the U.S. average.
“We remain very, very, very concerned about some costs coming down the road in Obamacare,” then-Senate President Pro Tem David Long said in 2013. “The continued costs just shake us. Medicaid, if we don’t do any expansion, will cost us $1 billion. That’s without any expansion.”
Pence’s proverbial baby elephant has reached adulthood, and the costs have skyrocketed. A billion-dollar Medicaid cost overrun came to light in late 2023.
So, too, has the U.S. debt. Now the federal budget deficit stands at $1.7 trillion while the national debt has skyrocketed to $36.22 trillion, prompting President Donald Trump, Elon Musk of the unofficial “Department of Government Efficiency” and congressional Republicans to present legislation that could slash $880 billion for Medicaid and the Children’s Health Insurance Program (CHIP). This could affect 80 million Americans, nearly 25% of the population.
That has prompted state legislatures to scramble to expand their Medicaid budgets or slash beneficiaries.
Gov. Mike Braun and General Assembly leaders are fretting over the uncertainty of potential cuts of federal money that goes to the states. Federal funding was projected to total nearly $22 billion for Indiana’s state government for the current fiscal year, making up about 42% of total state spending.
Some estimates are that close to 750,000 Hoosiers may lose Medicaid coverage if the cuts are passed by Congress and signed into law by Trump.
According to data from the Family Social Services Administration, Medicaid enrollment across all programs and delivery systems in July 2024 totaled 1.965 million people — 104,973 (5.6%) above the forecasted amount. Of those, some 686,364 are enrolled in the Healthy Indiana Plan 2.0.
If you want to talk to a stressed-out executive at your next Rotary meeting, seek out a nursing home or hospital administrator.
Howey Politics Indiana/State Affairs analyzed these voting patterns and how they affect the counties that voted in the 70th and 80th percentiles for Trump. We also broke out the four counties that voted for Democratic presidential nominee Kamala Harris.
Twenty-two Indiana counties voted at least a 74% plurality for Trump in November. These rural voters may end up with the short end of the stick when it comes to carved-back Medicaid coverage.
The top 10 Trump counties voted between 81.5% to 77.9%. They include Franklin (81.5% with 18.9% of residents receiving Medicaid and 36% of their kids on the Children Health Insurance Program. Daviess County voted 81.4% for Trump and had 22.4% on Medicaid and 40% of its on CHIP; Ripley 80%, 20.% and 35.7%; Martin 79.4%, 20.9% and 38.4%; Fountain 79.1%, 21.7% and 38.3%; Jennings 78.5%, 23% and 39%; Dearborn 78.4%, 18.8% and 34.3%; Decatur 78.4%, 19.5% and 39.2%; Switzerland 78%, 22.9% and 39.2%; and Wells 77.9, 18.8% and 35.1%.
The Harris counties are urban, more populated and university-oriented. There were similarities in the total percentage of county residents receiving Medicaid and child Medicaid (CHIP) coverage rates. The Harris counties covered more adults and older people seeking nursing home or home health care. The urban counties saw much higher rates in senior Medicaid draws than their rural counterparts.
Sen. Ryan Mishler, R-Mishawaka, author of Senate Bill 2, calls it “right-sizing” the program. “Medicaid is a big issue, and this is just a start,” Mishler told reporters in February. “There’s a lot more work to do. Medicaid has grown by $5 billion over the last four years.”
Mishler’s bill would cap the number at 500,000, meaning about 200,000 people could lose health coverage and would be relegated to a waitlist.
Senate President Pro Tem Rodric Bray, R-Martinsville, said he supported action to get the federal “fiscal house in order” while recognizing the havoc sudden cuts to the states could make. “It would be nice to be able to have some predictability as to what it’s going to be so we can adequately plan,” Bray told reporters in late February.
Braun has prioritized getting a handle on Medicaid costs. “You know the irony of Medicaid is it’s the lowest reimbursement of any form of health care,” Braun told reporters on Monday. “To me, it gets back to what I said often. We need to look at the industry itself to start explaining why on that side of the ledger.”
Brian A. Howey is senior writer and columnist for Howey Politics Indiana/State Affairs. Find Howey on X @hwypol.
