Waitlists and attendant care: House lawmakers move major Medicaid bills

House lawmakers on Tuesday passed several pieces of legislation that would curb some of the Medicaid savings measures advanced by the previous gubernatorial administration, eliminating waitlists and revisiting attendant care services for children with complex medical needs.

One of the proposals would also tighten payment requirements for senior care providers under the state's PathWays for Aging program, which serves Hoosiers age 60 and older. Separately, another House committee opted to advance a priority bill for the Republican caucus and strike prior authorization requirements for drugs used to treat opioid use disorder.

House Bill 1003 has six facets, according to author Rep. Brad Barrett, all with an aim to lower health care costs. An 18-page amendment was accepted by committee members and chiefly dealt with "site of service" language.

Barrett emphasized that the bill was still a work in progress and anticipated additional amendments in the coming days, comparing the bill's inner workings to pulling a loose thread.

"This is one of those things where you have a loose thread in your suit and you pull it and then the whole thing unwinds," said Barrett, R-Richmond. "And the next thing you know, your sleeves are coming off."

Caring for the neediest children

After identifying a $1 billion Medicaid budget shortfall in late 2023, the Family and Social Services Administration announced a series of moves to offset costs. One halted a pandemic practice that allowed parents to be paid as attendant caregivers for their medically complex children while another created waitlists for certain Medicaid services.

Combined with other changes, leaders with Gov. Eric Holcomb's administration said the moves would save the state $300 million. Additionally, the option to use parents as caregivers hadn't received federal approval and officials warned that Indiana could be on the hook for attendant care payments.

Under Gov. Mike Braun, FSSA appeared to be open to taking a second look, seeming to indicate to legislators that it would apply for a Medicaid waiver amendment to get federal approval. The federal government pays for roughly two-thirds of Indiana's Medicaid program, though the percentage varies by program.

The original version of House Bill 1689 would have required FSSA to apply while the amended bill doesn't include that obligation – something the author said was a "good faith" effort to work with the new administration.

"The issues addressed in this bill have been ongoing for more than a year," said Rep. Ed Clere, R-New Albany. "We've heard from (the Division of Disability and Rehabilitative Services) leadership that they're already moving in this direction, potentially, and we want to continue those conversations and give everyone an opportunity to work together."

Amendments could be submitted in the late summer or early fall and would include a definition for "extraordinary care," which the state is required to craft with public input. Using that definition, the state can amend its current plan to create another care option for families, specifically for those who cannot work because of their caregiving duties.

Jennifer Dewitt said her son required a ventilator, oxygen suction, a gastrostomy tube and associated pumps daily as well as a lift for transportation. She spoke in support of the bill on behalf of Indiana Families United 4 Care, a group for families impacted by attendant care changes.

"While we are approved for 55 hours of nursing a week … for most of the last month, we have been getting approximately 24 hours of nursing a week filled. And we live in Noblesville," Dewitt told committee members. "The lack of nursing has cost me at least three jobs.

"I love my son and I am the absolute best person to care for him. But I, like many families, feel forgotten. We feel like most people in government have no comprehension of the sheer amount of work managing a very medically complex child is," Dewitt continued.

The bill, which passed unanimously, also adds ombudsman oversight for two separate Medicaid waivers and requires the state to gather information on home- and community-based services for a report. Such a report would include information on complex care assistants, a role created by some states to supplement care options by paying family members.

Eliminating waitlists

But while the move to revisit attendant care services would, for now, come with little fiscal impact – the proposal that would eliminate the state's waitlists for Medicaid services comes at a higher, undefined cost.

House Bill 1592 prohibits FSSA from implementing waitlists for assisted living services if there are available slots under its federal waiver. If no slots are available, the state must apply for more.

FSSA isn't utilizing all of the available slots. The state's PathWays waiver notes that "the State's budget process drives the number of annually available waiver slots."

A previous estimate found that waitlists would likely save the state $232.2 million across fiscal years 2024 and 2025. Adding additional slots "will result in a significant increase in state Medicaid expenses if approved by the federal government," according to the fiscal note.

However, the fiscal note doesn't break out how many of the 10,231 disabled and elderly Hoosiers on waiver waitlists are explicitly seeking out assisted living services, as opposed to other home- and community-based services.

Long-term care providers said they'd accepted a handful of seniors on the waitlist with the hope they'll be accepted after learning about Hoosiers without food or health services.

Jill Stott, the executive director of Silver Birch, shared the story of Terre Haute's first female officer, now 77, who applied in April of 2024 while "sleeping on a couch and living out of boxes."

"She relied on food banks and donations to eat. Sadly, her health declined, both physically and mentally (due to) cancer. She needed to be in an environment where she could be monitored to start her chemo treatments," Stott said. "Every day she wasn't receiving assisted living services was a day that she was not being treated or cared for."

She had been invited off of the waitlist just weeks ago but Silver Birch's assisted living facility opted to house her prematurely because "we couldn't stand by," Stott said. Others waiting had to be hospitalized – which is a bigger expense on the state's coffers.

"We want to help people … but we can't provide charity care for every resident on the waitlist given the uncertainty of when – and if – they will become eligible," Stott said.

But for long-term care providers, getting someone off the waitlist and into services doesn't end the administrative burden.

By 2030, an estimated 23 percent of Hoosiers will be over the age of 65, a time when many people start relying on home- and community-based services or need additional medical care.

To accommodate the growing population of seniors, the state shifted from a fee-for-service model to managed care, directing private insurance companies to oversee and pay for care rather than paying claims piecemeal. But providers say that the overseeing managed care entities under the PathWays program have failed to submit timely payments for claims – including a handful of outstanding claims that date back to July 2024, the month PathWays launched.

"If structural reforms are not made to the existing PathWays program, I fear that we will have less providers ready in five years than we do today," warned Paul Peaper, the president of the Indiana Health Care Association and Indiana Center for Assisted Living.

Prior to PathWays, Peaper said claims were routinely paid within a week and he said the 2 percent interest penalty wasn't enough of a consequence to deter late payments. Peaper's organization estimated that managed care entities owed long-term care providers more than $100 million in outstanding claims.

A leader with the state's largest long-term care provider, American Senior Communities, testified that it added claims billing specialists just to track submissions. Katie Northington, the senior director for field accounting, said one resident's managed care entity hadn't paid from July to November – totaling $40,000 in unpaid care.

Due to the price tag associated with the waitlist elimination, the bill's future is uncertain. It must get an additional nod from the House Ways and Means Committee before moving into the fiscally restrained Senate. Republicans in that chamber introduced a bill that would cap Medicaid enrollment in a separate program for able-bodied, moderate-income adults – potentially creating another waitlist.