Pence, Ritz seek federal dollars without strings

Last week saw two diametrically opposed Indiana politicians go to great lengths to ensure the state wins large sums of federal money without the strings that are normally attached.

Last Monday, Schools Superintendent Glenda Ritz, a Democrat, filed a request with the U.S. Department of Education to continue using federal "Title I" education money with flexibility. A day later, Republican Gov. Mike Pence asked the federal Centers for Medicare and Medicaid Services to grant the state an exemption, and about $16.5 billion, to expand Medicaid using a version of the Healthy Indiana Plan.

The federal government's say in how the state operates has been a point of contention for some of Indiana's leaders. For example, Sen. Scott Schneider, R-Indianapolis, led the drive to pull Indiana out of the Common Core national education standards. But he removed his name from the legislation that formally ended the state's involvement when a caveat was added—that Indiana would do whatever was needed to maintain federal funding.

The question of control over federal dollars has also reignited dormant battles at the State Board of Education between Ritz and board members appointed by Pence and former Gov. Mitch Daniels.

If Indiana does not win its education waiver, schools would have to follow strict rules under the No Child Left Behind Act and new monetary restrictions that could hinder paying for teachers. Even the request for an exemption has come with requirements, most notably the start of a new statewide student test in the fall, but Ritz and others determined they would be much less onerous than what the state would face without the exemption.

Ritz said her staff and others put in "countless hours of work" to ensure Indiana maintains its waiver.

"Because of their work, I believe that Hoosier schools will have much needed flexibility over how they use some of their federal funding. Most importantly, this flexibility will improve education for our students," Ritz said in a statement.

Meanwhile, for Pence, the gambit is seeking access to billions of federal dollars that hospitals in Indiana say would greatly help the economy, while attempting to avoid a full-blown expansion of Medicaid under the federal health care law.

The alternative Pence negotiated with federal officials would avoid using traditional Medicaid—a system he regularly calls "broken"—to provide insurance for the poor. Instead, Indiana would have some of those people pay marginal fees to receive coverage through modified health savings plans, as well as provide support to residents who have access to an employer health plan but cannot afford it.

Pence wrote to U.S. Health and Human Services Secretary Sylvia Burwell that the state's Healthy Indiana Plan 2.0, is the "culmination of many months of productive good faith discussions" with the federal agency.

"The State of Indiana is capable and prepared to accept the terms outlined in this waiver and implement the HIP 2.0 expansion as soon as possible following approval," Pence wrote.

But not everyone agrees that Indiana should be cutting deals for federal dollars.

At a special meeting of the State Board of Education dealing with the waiver, fighting between Ritz and Dan Elsener, a board member and president of Marian University, centered on whether she would be able to ensure the waiver was approved.

And Andrea Neal, a Republican member of the education board, questioned whether Ritz and others should push back on U.S. Education Secretary Arne Duncan's ability to set restrictions on states.

"In contrast to other board members who want more information, I've been floored by the amount of energy and resource and manpower that's going into jumping through the federal government's hoops," Neal said at the meeting, which was called specially to review the waiver. "I personally feel that we have done ourselves a disservice by not questioning the federal government's level of involvement in this."

The state's requests for money now lie in the hands of federal officials. Ritz's staff said they were promised an answer by the end of the month, but finding out whether the state will win Medicaid money is likely to take months longer.