Indiana enacts Medicaid reforms and pauses waiver denials

Indiana has enacted House Enrolled Act 1277 (HEA 1277), a significant Medicaid reform law targeting long-term care and Home and Community-Based Services (HCBS). A key provision mandates that nursing facility residents who have been in a facility for 100 consecutive days will transition from the state’s risk-based managed care program, PathWays for Aging, to Medicaid fee-for-service starting July 1, 2027.

The law also directs the Indiana Family and Social Services Administration (FSSA) to seek federal approval for a standalone Medicaid waiver dedicated to assisted living services. If approved by the U.S. Department of Health and Human Services, the FSSA will transfer existing HCBS waiver slots to this new program and establish a stakeholder work group to oversee implementation.

Separately, Indiana officials have paused the denial of Medicaid waivers following concerns regarding a new assessment tool. The tool, implemented by the FSSA to determine eligibility for home-based care services, reportedly led to an increase in rejections for families seeking therapies and respite care. The nonprofit The Arc of Indiana is seeking public records to gain transparency regarding how the tool reaches eligibility decisions.