Are You HIP?

[Welcome Kaiser Network readers!]

No, not hip.

HIP, as in Healthy Indiana Plan.

The "low cost" health plan makes health insurance, coupled with a Health Savings Account, available to low income Indiana residents.

Low income is defined as a single earning less than $20,800 per year AND has been without health insurance for 6 months.

So what is to stop those who would otherwise qualify from dropping existing coverage?

Nothing.

How does the benefit work?

You have an $1,100 deductible before the plan pays anything. Everyone who participates also receives a health savings account with $1,100 in it.

So who pays for the plan?

Plan participants pay on a sliding scale, from 2% of their income up to 5%. Someone earning the maximum would pay $1,040 per year.

Who pays the rest of the cost of the coverage?

Unhealthy folks.

If you buy cigarettes in Indiana, regardless of where you smoke them, you pay $0.44 per pack to help fund the plan.

So what is covered?

That is a good question. The HIP website appears to be short on details.

Two things I did learn.

You get a $500 annual wellness benefit, and the plan caps out covered charges at $300,000.

Ouch.

We have posted on low limit plans before, here and here.

One question I have is this.

If the plan is partially funded by cigarette taxes, rather than creating a special plan just for the 130,000 uninsured, why not use the tax money to subsidize the purchase of health insurance plans that already exist in the market place? Isn't that a better use of resources?

I guess I am not HIP.