Former Gov. Mitch Daniels' Newsroom

Contact: Jane Jankowski
Phone: 317-232-1622

For Immediate Release: May 16, 2005
Governor's veto message regarding HEA 1142
May 12, 2005

May 12, 2005


The Honorable Brian C. Bosma

Speaker of the House

Indiana House of Representatives
114th General Assembly           


Indianapolis, Indiana  46204


Dear Speaker Bosma:


By the authority vested in me as Governor of Indiana, under the provisions of Article 5, Section 14, of the Constitution of the State of Indiana, I do hereby veto House Enrolled Act No. 1142, enacted during the regular session of the 114th General Assembly and related to the expansion of Medicaid eligibility and organ procurement procedures.


Tomorrow I will sign a budget bill that curbs the rate of Medicaid spending to just above 5%.  Considering that spending in this area was projected to grow at an unsustainable annual rate of more than 10% for the next several years, you and your colleagues made some very difficult decisions to implement a number of important and necessary measures to achieve this goal.  In this situation, I cannot support measures that would damage the state's ability to control spending in this area and that would further strain its Medicaid budget.


This Act would have expanded Medicaid eligibility by permitting individuals to assign pre-paid life insurance policies to the state or make an irrevocable election to name the state a beneficiary of the policy.  It is my understanding that the intention of the Act was to begin to address some of the significant financial issues facing our long-term care system.  However, according to the State Budget Agency, this Act could have led to additional state Medicaid expenditures of $12.4 million in FY06 and $12.9 million in FY07.  


In addition, this Act might have had the unintended consequence of opening the door to the kind of abuse that already plagues an overburdened Medicaid system – the manipulation of eligibility parameters at the expense of both the state and those already receiving coverage.  Finally, it is unclear whether such a measure would have been acceptable to the Centers for Medicare and Medicaid Services at the federal level or would have resulted in the need to amend our State Medicaid Plan.  As such, I do not believe that the passage of this Act is the most advisable step our state can take to provide long-term care coverage for needy Hoosiers at this time.  This is a laudable goal, one that my administration will work in close coordination with the initial sponsor of the Act to pursue. 


The other component of this Act purports to offer an improved process for organ harvesting and procurement in certain circumstances.  However, it appears that many of the people affected by these measures – namely, the county coroners, county prosecutors, and organ and tissue procurement organizations – have not reached consensus on this effort.  As a result, I am in favor of allowing more time for these constituencies to work on this very important issue and to address it in future legislative sessions.


I look forward to working with the authors of this Act on finding other ways to solve our looming uninsured problem in this state and providing quality health and long-term care services to Indiana’s citizens in the future.






Mitchell E. Daniels, Jr.