Daniels expresses concern about health care proposals

Indiana Gov. Mitch Daniels outlined his concerns about some of the health care proposals being debated in Congress in a
letter sent to the state’s congressional delegation and released by his office yesterday.

Daniels sent the letter
to all members of the delegation Tuesday. In it, he said he fears "the current rush to overhaul the system will ultimately
do more damage than good and create far more problems than it solves." "While these reforms could do serious damage
to our state, I fear they will also have harmful consequences all across the country by reducing the quality and quantity
of available medical care, stifling innovation and further burdening taxpayers," the letter said.

President
Barack Obama and Congress have spent weeks debating proposals for a government-sponsored plan that many Democrats who control
the House and Senate want to compete with private insurers. Under Obama’s plan, insurance policies could not be canceled
if people get sick and insurers would not be able to deny coverage for pre-existing conditions.

For the millions
who lack insurance — or have trouble getting it after being laid off or deciding to start a business — Obama’s
plan would set up a new marketplace in which consumers could pool together. Government subsidies would be available to make
premiums more affordable. But individuals would be required to get coverage, and employers would have to contribute.

Many Republicans have balked at the proposals and their costs, saying the plans would amount to socialized medicine.
Some of the Democrat bills would greatly increase eligibility for Medicaid, the state and federal insurance program for the
poor and disabled. Daniels said expanding Medicaid would force many Indiana residents off a state-funded medical savings
account plan and onto Medicaid, which he said does not focus on prevention, healthy lifestyles and personal responsibility.

The Healthy Indiana Plan provides up to $500 a year in free preventive health care such as cancer screenings and
flu shots, a medical savings account worth $1,100 a year, and when medical costs exceed that amount, benefits of at least
$300,000 annually. It also was designed so the state, enrollees and willing employers all pay something into the medical
savings account. However, 72 percent of enrollees pay nothing because they earn less than the federal poverty level, currently
$10,830 for an individual or $14,570 for a couple.

Daniels said he feared states would be forced to pick up the
cost for Medicaid expansions. He said under one scenario, his administration estimated it could cost Indiana $724 million
more annually in Medicaid.

"Those additional costs will overwhelm our resources and obliterate the reserves
we have fought so hard to protect," he said in the letter.