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On January 17, 2024 and January 26, 2024, Indiana’s Family and Social Services Administration announced several proposed changes to the state’s Medicaid program. It is widely believed that these proposed changes are an attempt to address the $984 million budgetary shortfall in the state’s 2023-2024 Medicaid budget. These changes will negatively impact seniors and parents of disabled children in myriad ways.

Changes Impacting Seniors

There are several changes to the administration of Medicaid for seniors who are receiving long-term care (either at home, in assisted living, or in a nursing home). Most notably:

1. Previously, all retirement accounts (IRAs, 401(k)s, 403(b)s, pension savings plans) of the “community,” or non-Medicaid, spouse were exempt resources. This meant that even if one spouse had to become Medicaid eligible in order to pay for a nursing home, assisted living facility, or in home waiver services, the community spouse could rely on his or her IRA for financial stability. The new proposed rules will now count the full value of community spouse retirement accounts in calculating spousal eligibility, forcing community spouses to liquidate and spend down those resources, or forcing couples to divorce.
2. The standards for “personal services contracts” will become much more stringent and difficult to meet for paid family caregivers. In other words, seniors who are being cared for in their home by a family member will have to have formal care contracts that meet very strict legal standards, or all payments to such family caregivers will be penalizable gifts if and when that senior applies for Medicaid long-term care coverage.

Comments on these proposed changes should be directed to: [email protected].

Changes Impacting Parents of Disabled Children

Under current Medicaid guidelines, parents of disabled children, as well as legal guardians of disabled adults, can serve as paid caregivers under Medicaid’s Aged and Disabled Waiver program. This policy allowed a parent or guardian to leave the workforce to care for a disabled loved one without a corresponding loss of income. It also addressed the widespread lack of qualified in-home caregivers for medically fragile children throughout Indiana.

FSSA has now announced that this policy will be drastically amended. Legal guardians of adults can still be paid for up to 40 hours of care a week, but parents of minor children will no longer be able to serve as paid caregivers. They will instead have to transition to the Structured Family Caregiving program, which provides a drastically smaller, monthly fixed payment to the family.

Comments on these proposed changes should be directed to: [email protected].

More information about all of these changes can be found at https://www.in.gov/fssa/ddrs/ddrs-policies/ddrs-draft-policies-for-public-comment/

THIS IS AN URGENT CALL TO ACTION. We would encourage you to reach out to FSSA to share your concerns about these detrimental changes that will harm our most vulnerable Hoosiers.