Indiana will not issue new child care vouchers to impoverished families until at least 2027, Family and Social Services Administration leaders said at a quarterly fiscal meeting Wednesday, in the agency’s latest strategy to contain enrollment — and cut expenses.

“As Indiana looks ahead, the story of 2024 and 2025 will hopefully be remembered as a turning point — a year when policymakers chose to prioritize children and families, even at the cost of short-term strain on child care businesses,” said Adam Alson, director of FSSA’s Office of Early Childhood and Out-of-School Learning.

He spoke from a lectern in Government Center South’s sparsely filled auditorium, prompting scoffs from a contingent of hard-hit child care workers seated front and center.

Alson knocked former Gov. Eric Holcomb’s administration for “overenroll(ing)” Indiana’s voucher programs using temporary pandemic aid, instituting “artificially inflated” reimbursement rates and not planning for a wind-down to normal funding levels.

“We have a responsibility to Hoosier families, Hoosier child care businesses and Hoosier taxpayers to make policy decisions based on the simple constraint of funding,” he said. “We have, and will continue to have, a laser focus on our costs in order to maximize available funding to CCDF vouchers.”

FSSA has cut contracts, staffing and provider reimbursement rates to make ends meet, Alson said. Lawmakers also appropriated $147 million in “hold harmless” funding — enough to renew vouchers for families already on the program and at the same income requirements.

Enrollment in the federal Child Care Development Fund and state On My Way Pre-K programs peaked at 69,000 in December. That month, FSSA closed enrollment and opened a waitlist.

Vouchers have dropped to about 55,000 as of September, according to meeting slides.

Almost 31,000 low-income Hoosier children were on the waitlist for vouchers that month, up from about 29,000 the month prior.

About 80% of those on the waitlist in September were under the federal poverty line, compared to roughly 60% of current participants. New enrollees must meet narrowed income standards.

The 10-month freeze has crushed enrollment, according to the updated figures.

The number of infant voucher-holders — born after the waitlist opened — has dropped 95% since last November, according to the slides. Enrollment for toddlers has dropped 33%, pre-schoolers 14% and school-age children 8%.

Alson’s office projects that it will not take CCDF voucher hopefuls off the waitlist through 2026, assuming federal contributions remain flat.

“OECOSL simply does not have the funding available to prudently begin enrollment before that,” Alson told the auditorium.

Vouchers for OMWPK were also curtailed for the current school year, including a cap of 2,500 enrollees that FSSA doesn’t expect will be hit.

After the presentation, FSSA spokesman Marcus Barlow posed questions submitted by meeting attendees about the waitlist, funding, rate-setting and more.

Asked how much money is required to open the waitlist, Alson replied, “We need to be at a point, as an office, that we feel comfortable in — let me take a step back.

“What’s happened here, in the last year, with OECOSL, can never happen again,” he said. “We cannot be so far off what we enroll versus what our funding is. It just cannot happen again.”

There’s one small exception, according to FSSA spokesman Tyson Runkle: Indiana Code requires the office to provide vouchers for 200 foster children.

Providers complain the enrollment freeze and double-digit rate cuts threaten their livelihoods — 23 locations have closed since June, per the slides — and the care of low-income children.

Dawn Justice, owner of A New Dawn Daycare in Clark County, told the Capital Chronicle that she hasn’t raised rates since 2012. In the auditorium seat next to her, Mary Rudolph, owner of Where Kids Count Childcare in Floyd County, said she’s made no hikes in 21 years of business.

The pair drove two hours to attend Wednesday’s meeting. Justice said it’s a “burden” on families to offset the rate cuts. Parents are responsible for paying the overage — the difference between the rate providers charge and the reimbursement they receive from the state.

FSSA cut rates 10% for infant and toddler care, 15% for preschoolers and a whopping 35% for school-age children. The rates went into effect Oct. 5, with the first pay date being Nov. 6.

Several child care providers confronted Alson outside the auditorium after the presentation.

He defended the office’s changes, repeatedly noting that it can only spend what’s appropriated, during a conversation lasting at least 10 minutes. As the minutes ticked past, tempers flared.

“Why are you against us? It feels like you’re against us,” said Kelly Dawn Jones, owner of Love Your Child’s Childcare in Marion County. “Why does it feel like you are against the people who truly — we’re literally out here ready to fight for the children.”

She said she has kids at her facility staying for free, essentially, like a child whose voucher paid out just $4 even though it used to provide $120.

Jones continued until Alson interrupted, saying, “I need to go. I thank you for your time.”

As the incensed providers accused him of not caring, he repeated his thanks and departed.

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The Indiana Capital Chronicle is an independent, nonprofit news organization dedicated to giving Hoosiers a comprehensive look inside state government, policy and elections. The site combines daily coverage with in-depth scrutiny, political awareness and insightful commentary.

You can read the original version of the story here.

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NDIANAPOLIS — As the final minutes ticked by for the 2024 legislative session, legislators walked back previous proposals to tighten oversight of the Family and Social Services Administration (FSSA) and increase payments to families caring for disabled children.

Additionally, a priority Senate bill on reducing fines and fees easily passed both chambers.

Earlier in the week, a bill on state funds included several “accountability” reports for the agency, which reported a nearly $1 billion shortfall for the next 18 months of their operating budget.

But not everyone was happy with the final version, which passed the House unanimously.

“We really had an opportunity this session to make a large leap in helping those families. We’re leaving this session without addressing the needs of those needy families,” said Rep. Cherrish Pryor, D-Indianapolis. “I will be supporting the bill because we’re doing some things. We’re really not doing enough but I guess a little bit of something is better than a whole lot of nothing.”

The bill had a tougher time in the Senate, where it passed on a 42-5 vote. The senators who spoke against the bill didn’t mention attendant care or FSSA oversight as an issue.

Background on attendant care, FSSA

In response to the $1 billion deficit, FSSA announced a series of cost-saving measures that included halting a 2% Medicaid index, or increase.

However, the House amendments on reporting and pass-through payments moved from Senate Bill 256 to House Bill 1120 in the waning hours after the Senate ruled that the additions weren’t germane to the underlying bill.

House Bill 1120 also makes several tweaks to property tax law, including language on deductions and assessments for certain classes of Hoosiers, such as veterans, among other provisions.

Rather than requiring that a specific percentage of funds be passed through to families, the bill now states that FSSA “shall” set a required minimum percentage of reimbursement for personal care services, which includes structured family caregiving and attendant care.

Previously, the House had passed language mandating that 80% of funds paid by FSSA go to families in response to reports of caregivers receiving less than half of attendant care funds.

“I know in the House-passed version … we had 80%. I can tell you right now, (that’s) probably not workable,” Thompson told members of the rules committee.”My guess is in the 50 to 70 (percent) — taking a ballpark guess — of where it would fall.”

Additionally, the agency must prepare and present a plan for monitoring Medicaid expenses to the Medicaid Oversight Committee and not the State Budget Committee. That report must include: monitoring plans, plans to improve transparency for Medicaid expenditures and “an explanation of the issues that led to the deviations in the … Medicaid projections” along with planned improvements.

Lastly, FSSA must include “information concerning the transition” from attendant care to structured family caregiving — a weaker requirement than previously introduced by House Republicans.

In a statement, Rep. Ed Delaney called the cutting of enhanced reporting standards previously in Senate Bill 256 a “cover up.”

“When the Republican administration makes a billion-dollar mistake, the Republican legislature has choices to make. They can try to get to the root of it and hold people accountable, or they can try to bury the issue. They can make sure that families with seriously disabled children are protected from this error, or they can let the poorest among us suffer,” the Indianapolis Democrat said. “… Hoosier taxpayers deserve to know what exactly happened to their hard-earned money. It is telling that provisions to increase fiscal transparency were removed behind closed doors during the least transparent part of the legislative process.”

Other action on SB4

Lawmakers additionally approved Senate Bill 4, a priority for Senate Republicans. The bill would establish a review of unused state government funds and allow agencies to cut fines or fees through an internal process — rather than requiring an appearance before the State Budget Committee.

Rules with a fiscal impact of more than $1 million are subject to additional scrutiny and requirements under the final version of the bill — entirely new language that Democrats noted hadn’t been mentioned in a brief conference committee earlier this week.

“It is really now this session’s poster child for a failing conference committee session,” Rep. Matt Pierce, D-Bloomington, said. “What is the point of having these meetings? How are you supposed to understand as a member of the public — as a fellow member of this body — what are the issues at stake within Senate Bill 4?”

“And so now we have a bill adding in all this stuff that never got a hearing or discussion in the house (and) adding in some new bureaucracy. So now the agencies have to jump through yet another hoop when they’re attempting to do something,” Pierce continued.

Pierce and two dozen of his Democrat colleagues voted against the bill, which cleared the chamber on a 68-25 vote. The bill faced no opposition in the Senate and moved on a 46-0 vote.

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The Indiana Capital Chronicle is an independent, nonprofit news organization dedicated to giving Hoosiers a comprehensive look inside state government, policy and elections. The site combines daily coverage with in-depth scrutiny, political awareness and insightful commentary.

You can read the original version of the story here.

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INDIANAPOLIS — Just over 1,600 disabled children receiving services through the Family and Social Services Administration (FSSA) made up a significant portion of the unexpected expenses that caused a $1 billion Medicaid shortfall — the first time the agency has publicly identified the number of children benefiting from an attendant care program that paid their parents.

In the last year, though, expenses for the program skyrocketed as families — many for the first time — had livable wages to cover the expense of caring for their medically complex children with few guardrails.

For Indiana Medicaid Director Cora Steinmetz, the program’s growth was unsustainable — particularly important as the program eats up an ever-growing slice of the state’s budget — and prompted agency action.

“Enrollment on this waiver has grown but not at a pace that really explains the rapid increase in expenditures. It’s been so much more in the space of utilization than enrollment,” Steinmetz said.

The state didn’t have a maximum limit for the number of hours an LRI could claim, meaning that some families claimed as many as 100 hours per week. It’s unclear whether FSSA monitored the number of hours or left such oversight to the providers who trained and paid families.

FSSA also noted that while families reported receiving as much as $15 per hour, the agency was paying providers $34.36 per hour — meaning that less than half went to the caretakers and most of the state’s funds went to the providers.

“We … don’t have the transparency or don’t receive the data around how much the caregiver receives in reimbursement … What we have heard from caregivers is that $15 an hour is a typical level of compensation under attendant care,” Steinmetz added.

Structured Family Caregiving

Steinmetz shared that 1,622 children were beneficiaries of the attendant care program in a Medicaid Advisory Committee, the first since the announced Medicaid shortfall in December.

While the attendant care program has received a disproportionate amount of attention, FSSA has implemented several other changes — such as halting a 2% Medicaid indexing that would have increased reimbursement rates for six different providers, including dentists and home health services.

Instead of attendant care, FSSA is attempting to shift families into the Structured Family Caregiving program, which pays a per diem rather than an hourly rate.

As of December, children made up 8% of the 20,847 Hoosiers receiving attendant care in the state while Hoosiers 60 years of age and older made up the bulk — nearly two-thirds — of the program.

FSSA reported that in March 2022, when the LRI program started, 10% of children got more than 60 hours of attendant care per week. By December 2023, nearly half of children — 47% — were getting that much.

However, both parents can participate as LRIs under attendant care. It’s unclear how many of the 1,622 children had both parents paid as caregivers.

Just two years ago, only 456 children utilized attendant care at a cost of $9.3 million. But with over 1,600 children, the costs soared to $172 million — a number that includes a Medicaid increase implemented over the summer.

In contrast, Structured Family Caregiving comes in three different tiers, based on need. A family can receive $77.54, $99.71 or $133.44 per day and providers are expected to retain between 30-35% of that cost for administrative care — which includes 15 days of respite care for the caregiver.

“Under both services, the Medicaid program pays a provider service agency who then compensates the caregiver,” Steinmetz said. “So this is not a service whereby the caregiver is directly contracting with the Medicaid program.”

A family where one parent provides full-time care at $15 per week would earn around $31,200 a year — roughly equivalent to a level three structured family care recipient getting $133.44 each day, or $34,093 annually, according to FSSA.

Notable, both attendant care under LRI and structured family care are excluded from income for federal taxation purposes.

Unanswered questions for families

Families have repeatedly rallied at the Statehouse, seeking clarification on the change. In a chat accompanying the hybrid meeting, families wondered why the state couldn’t maintain the attendant care program with guardrails — such as limiting hours like other states.

“Are there enough home health care nurses and medical workers to provide care for the 1,600 critically ill children whose parents will no longer be able to afford to provide care themselves,” asked Olivia Ruzic.

Ruzic previously shared the story of her family’s reliance on attendant care to provide for three-year-old Archer, born with Kabuki Syndrome, with the Indiana Capital Chronicle. For a time, the Ruzic family lived in a two-bedroom home where Archer slept in a closet but attendant care transformed the family’s way of life, allowing Archer’s father, Jesse Ruzic, to go back to school and study nursing.

In another comment, Ruzic noted the near-poverty line wages under Structured Family Caregiving. For 2024, $31,200 is considered the Federal Poverty Line for a family of four like the Ruzics.

Parent Sarah Saylor, who has also rallied at the Statehouse, noted that earlier reporting could have flagged the growing deficit. Unlike other states, Indiana doesn’t report expenditures on a monthly or quarterly basis and House Republicans have repeatedly resisted efforts to compel the agency to make such reports.

“We truly want to understand and work together … (and) collaborate,” Saylor said. “We want to find a program that is financially sustainable that also meets the needs of all Indiana members, including waiver recipients…”

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The Indiana Capital Chronicle is an independent, nonprofit news organization dedicated to giving Hoosiers a comprehensive look inside state government, policy and elections. The site combines daily coverage with in-depth scrutiny, political awareness and insightful commentary.

You can read the original version of the story here.

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