By Christine Vestal
Stateline.org

Less than a year after low-income Arkansans started receiving health coverage under the Affordable Care Act’s controversial Medicaid expansion, the state is declaring its so-called “private option” experiment a success.

In Indiana…
Indiana Gov. Mike Pence has asked federal officials for permission to extend the Healthy Indiana Plan in place of a traditional Medicaid expansion.

The Indiana proposal could cover as many as 350,000 non-disabled adults ages 19-64 who earn between 23 percent and 138 percent of the federal poverty level. In 2014, that means a maximum income of $16,105 annually for an individual and $32,913 for a family of four.

The plan would require some participants to pay a deductible or fee to participate, which has raised questions among federal officials who are reviewing the proposal.

Hospitals saw fewer uninsured patients, state coffers were spared millions in health care costs and private insurers reported record-low premium hikes. Most important, Arkansas’ uninsured rate fell from 23 percent to 12 percent, the sharpest drop in the country.
But lawmakers in Arkansas, where Gov. Mike Beebe is a Democrat and the legislature is controlled by Republicans, have already asked the federal government for adjustments to their groundbreaking plan, under which Arkansans used Medicaid dollars to purchase private health insurance on the insurance exchange created under the ACA. Meanwhile, other states are customizing their own alternative approaches to expanding Medicaid to cover adults with incomes up to 138 percent of the federal poverty level ($16,105 for an individual).

“It’s an iterative process,” said Matt Salo, director of the National Association of Medicaid Directors. “States are probing the defenses of the HHS (U.S. Department of Health and Human Services) fortress to see what they can get approved,” he said.

Ever since the U.S. Supreme Court made the federal health law’s Medicaid expansion optional for states, the debate over expansion has become a proxy for supporting or opposing Obamacare.

After the November elections, more states are expected to reconsider their largely political decisions to pass up millions in federal dollars that can be used to improve the health of their residents.

“This is a fight within the Republican party,” said Joan Alker, director of Georgetown University’s Center for Children and Families. “After the election, when governors and lawmakers feel less threatened, we should see more movement,” she said. Alker and others cite Idaho, Montana, Nebraska and Florida as possible converts.

So far, 28 states and the District of Columbia have decided to expand Medicaid and 22 have not. Of the 28 states that have expanded the federal-state program, 19 have Democratic governors and nine – Indiana, Iowa, Michigan, Nevada, New Jersey, New Mexico, North Dakota, Ohio and Pennsylvania – are led by Republicans.

Jennifer Nelson for www.theindianalawyer.com

The Indiana Court of Appeals, after skirting around the issue in 2012, decided that Indiana should use the case-by-case approach to address subrogation claims of landlords’ insurers against negligent tenants.

Tennant Hillary Mannia caused nearly $750,000 in damages to Summer Place Apartments when a fire started resulting from her disposal of cigarettes on a balcony. After the fire, the apartment’s insurance company, Greater New York Mutual Insurance Co., filed an insurance subrogation action in the name of LBM Realty LLC, which owned the apartments. Mannia filed for summary judgment, asking the trial court to adopt a no-subrogation rule, citing Sutton v. Jondahl, 532 P.2d 478 (Okla. Ct. App. 1975), which would preclude the complaint against her.

Sutton stands for the proposition that absent an express agreement in the lease to the contrary, landlord and tenant are considered co-insureds under a landlord’s fire-insurance policy; the insurer, therefore, has no right of subrogation against the tenant to recover payments made under the insurance policy due to fire loss, even if the fire is caused by the tenant’s negligence.

The trial court adopted the rule and applied it, which led to the grant of her motion to dismiss. LBM appealed, and the COA reversed and remanded without adopting any approach.

Now, two years later, the appeals court has decided that the case-by-case approach should be adopted.

“Having considered the range of possible approaches, we conclude that Indiana should hereby adopt the largely case-by-case approach, finding that a tenant’s liability to the landlord’s insurer for damage-causing negligence depends on the reasonable expectations of the parties to the lease as ascertained from the lease as a whole and any other admissible evidence,” Chief Judge Nancy Vaidik wrote. “Although the case-by-case approach is said to provide less predictability than either the pro- or no-subrogation approaches, we find that this approach best effectuates the intent of the parties by simply enforcing the terms of their lease. In determining the expectations of the parties as articulated in the lease, courts should look for evidence indicating which party agreed to bear the risk of loss for a particular type of damage.”

“However, with regard to tenants in a multiunit dwelling, we find that absent clear notice—ideally in the form of an unambiguous, enforceable lease provision—that a negligent tenant will be held liable for damages to areas of the building beyond the tenant’s leased premises, such liability would not be within the tenant’s reasonable expectations and is therefore barred. This approach also avoids the unreasonable expectation and economic waste of requiring every tenant in a multiunit apartment building policy to carry insurance coverage adequate to cover damage to the entire building, particularly when the landlord presumably already maintains such coverage.”

The judges affirmed that summary judgment was properly granted to the extent the $742,402.86 insurance claim is for damages to areas beyond the leased premises because based on the lease, Mannia was not on notice that she would be liable for damage caused by negligence to areas of the multiunit apartment building beyond the lease premises. But summary judgment was inappropriate with respect to damage to the lease premises. They ordered on remand for the trial court to engage in the analysis of the case-by-case approach.

The case is LBM Realty, LLC, d/b/a Summer Place Apartments, an Indiana Corporation v. Hillary Mannia, an Indiana Resident, 71A03-1402-PL-66.