Smokers cough up the funding
Gov. Mitch Daniels signed legislation last week that supporters claim will advance health care policy in Indiana through an innovative and comprehensive program. The new plan provides health insurance coverage for uninsured Hoosiers and aims to reduce the state’s high rate of smoking. State Sen. Patricia Miller and Rep. Charlie Brown, who worked throughout the just-concluded legislative session to gain passage of the plan, were among those who joined the governor to sign HEA 1678.
“Today we are taking a long step toward the dream of a healthier Indiana. We are taking the longest, single step Indiana has ever taken in this direction,” Daniels said. “With the tools these brave legislators have provided us, now we must go about the difficult business, harder than you may think, of reaching those who would like to stop smoking with help, of finding the children who are not being immunized on time in this state and seeing that happens in every single case and reaching out to those without insurance to let them know about a great new opportunity that may apply to them, and then connecting them so they can go to bed tonight with a peace of mind of knowing they are protected.”
The plan includes a 44-cent tax increase per package of cigarettes, which is estimated to discourage 40,000 fewer youth smokers and 23,400 fewer adult smokers. Thirty-three cents of the increase will be used to provide more needed childhood immunizations, the health care plan for low-income Hoosiers, smoking cessation programs and help for small businesses to offer health insurance to their employees; 3 cents for increased Medicaid provider reimbursement rates, 5 cents for other health initiatives and 3 cents for Section 125 plans (a plan that allows employers and employees to purchase health insurance on a pre-tax basis).
There is $11 million more for childhood immunizations and Indiana Tobacco and Prevention Cessation will receive a 50 percent increase in funding: $1.2 million from cigarette tax funds and a $4.2 million increase in its annual general funds ($10.8 million to $15 million).
“All by itself, raising the price of tobacco products will lead people of this state to finally cross over and stop smoking as 70 percent of Hoosier smokers say they would like to do. And of even greater importance, it will deter thousands and thousands of young people from ever experimenting with tobacco,” Daniels said.
Daniels introduced the plan last November, and the bill passed the Indiana House and Senate with bipartisan support. In addition to Rep. Charlie Brown, D-Gary, and Sen. Patricia Miller, R-Indianapolis, Sen. Vi Simpson, D-Bloomington, Rep. Tim Brown, R-Crawfordsville, Sen. Gary Dillon, R-Pierceton, and Sen. Earline Rogers, D-Gary, played a significant role in passage of the historic legislation.
“The stars were aligned in order for us to do this. It is indescribable what happened, that we were able to come together to pass this wonderful piece of legislation that is comprehensive in terms of covering mental illness, pregnant women, children, the works,” Brown said. “We have all come together to say that if we want to improve the quality of health care for the citizens of Indiana, then we need to take this bold step.”
“This will help individuals purchase affordable health insurance, and it will help businesses who don’t currently provide insurance for their employees have health care coverage. That’s what we’re all about, making sure Hoosiers have health insurance,” Miller said. “I especially want to thank Governor Mitch Daniels, who took the bold and courageous step last fall to propose legislation.”
Last week, the Indiana Family and Social Services Administration issued a Request for Services for implementation of the health insurance proposal. FSSA expects to begin enrollment of Hoosiers eligible for the health insurance program in the fall with a targeted effective coverage date of Jan. 1, 2008. Public meetings about the process to secure services begin next week.
Coverage will be available to adults and pregnant women who earn up to 200 percent of the federal poverty level (for a family of four, 200 percent of federal poverty equals $40,000 annual income).
Insuring the uninsured
Key components of the plan for uninsured Hoosiers to be funded by the increased cigarette tax include:
• A POWER account of $1,100 per adult to pay for initial medical costs. Each participant and the state will contribute to the account according to a sliding scale.
• A traditional commercial benefits package that will cover medical costs above $1,100
• Services that will include hospice, preventive services, disease management and others
• $500 preventive services a year for each participant (includes smoking cessation)
• Increases eligibility for insurance coverage for children (under the Indiana CHIP program) to 300 percent of the federal poverty level
• Provides presumptive eligibility for pregnant women
• Provides a small business qualified wellness program tax credit
• Provides a tax credit for small employers for the cost of implementing a Section 125 Plan ($50 per employee; capped at $2,500)
• Allows the FSSA secretary to develop a program that allows certain small employers to join together to purchase group health insurance
• Tasks the Health Finance Commission to study statewide smoking ban issues