Verma could give states more power to redesign Medicaid

Medicaid on paper and a stethoscope
Seema Verma, who is Donald Trump's pick to lead the Centers for Medicare & Medicaid Services, played a pivotal role in designing the Healthy Indiana Plan, the state's version of Medicaid expansion. (Getty/designer491)

If Seema Verma is confirmed as the next head of the Centers for Medicare & Medicaid Services, it could pave the way for states to experiment more freely with their Medicaid programs. But it is still too soon to tell whether the program she designed in Indiana will be successful.

Verma, a consultant with the firm SVC Inc., was the brains behind the Healthy Indiana Plan, a Medicaid expansion program in which beneficiaries are required to contribute a small amount monthly toward their health insurance premiums through special savings accounts. Verma’s experience has also led her to help states such as Kentucky, Iowa and Ohio design their own Medicaid expansion proposals.

Seema Verma, Trump's pick for head of CMS
Seema Verma

To some, like former Indiana Gov. Mitch Daniels, Verma is a Medicaid expansion visionary, according to a post from the New York Times’ blog The Upshot. Individuals learn to make more careful decisions about their healthcare spending when coverage isn’t completely free, argued Daniels, who worked with Verma on an early version of the plan.

A report commissioned by Indiana found that the program extended coverage to about 207,000 people who were not enrolled in Medicaid previously, but experts caution that it is too early for a complete analysis of the Healthy Indiana Plan, according to the Washington Post. The system relies on a complex set of rules meant to encourage saving money and using preventive care.

But critics say that complexity is problematic and that there isn’t really evidence that the program’s incentive structure leads beneficiaries to change their behavior, The Upshot post notes.

Verma’s appointment, though, could do more than simply spur a host of Healthy Indiana Plan copycats. Her work with Kentucky Gov. Matt Bevin on a Medicaid redesign indicates she could rethink CMS’ policy of nixing Medicaid expansion proposals that include work requirements, according to the Post. And, The Upshot post adds, she could encourage states to use an Affordable Care Act provision to replace Medicaid and the ACA exchanges with their own comparable systems—a strategy that some policy experts see as a backdoor way to dismantle the healthcare law.