Indiana will become the latest Republican-led state to expand Medicaid under Obamacare, Gov. Mike Pence (R) announced Tuesday.

Pence outlined the alternative expansion plan that he and the Obama administration had agreed upon, which builds on an existing state program.

“I believe that Medicaid is not a program we should expand, but one we should reform. That’s exactly what we are doing,” Pence said, although the proposal is still using Medicaid expansion dollars to extend coverage, and is only possible through a federal Medicaid waiver.

Using the Healthy Indiana program, which sets up health savings accounts, Indiana will require enrollees above the poverty level to make monthly contributions. If they fail to do so, they could lose some benefits. Those below the poverty line have the option to make additional payments to receive better coverage, but it is not required.

Contributions under the program will not exceed 2 percent of an enrollee’s annual income. Pence’s plan also includes a work-referral component, though there is no requirement for enrollees to participate.

About 350,000 low-income Indianans are expected to be covered by the Medicaid expansion.