A CRS Review of 10 States: Home and Community-Based Services — States Seek to Change the Face of Long-Term Care: Indiana

A CRS Review of 10 States: Home and Community-Based Services — States Seek to Change the Face of Long-Term Care: Indiana

Order Code RL32295
CRS Report for Congress
Received through the CRS Web
A CRS Review of 10 States: Home and
Community-Based Services — States Seek to
Change the Face of Long-Term Care: Indiana
December 15, 2003
Jane Tilly
Consultant
The Urban Institute
Carol O’Shaughnessy
Specialist in Social Legislation
Domestic Social Policy Division
Rob Weissert
Research Assistant
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

A CRS Review of 10 States: Home and
Community-Based Services — States Seek to Change
the Face of Long-Term Care: Indiana
Summary
Demographic challenges posed by the growing elderly population and demands
for greater public commitment to home and community-based care for persons with
disabilities of all ages have drawn the attention of federal and state policymakers for
some time. Spending on long-term care by both the public and private sectors is
significant. In 2001, spending for long-term care services for persons of all ages
represented 12.2% of all personal health care spending in 2001(almost $152 billion
of $1.24 trillion). Federal and state governments accounted for almost two-thirds of
all spending. By far, the primary payor for long-term care is the federal-state
Medicaid program, which paid for almost half of all long-term care spending in 2001.
Many states have devoted significant efforts to respond to the desire for home
and community-based care for persons with disabilities and their families.
Nevertheless, financing of nursing home care, chiefly by Medicaid, still dominates
most states’ spending for long-term care today. To assist Congress in understanding
issues that states face in providing long-term care services, the Congressional
Research Service (CRS) undertook a study of 10 states in 2002. This report, one in
a series of 10 state reports, presents background and analysis about long-term care
in Indiana.
Indiana is the 14th largest state in the country with 6.1 million people in 2000;
about 12.4% of its population is aged 65 and older. The state’s oldest population
grew quite rapidly during the 1990s — those aged 85 and older grew by 27.6% from
1990-2000. By 2025, persons aged 65 and older will represent close to one out of
five persons, slightly higher than the U.S. average.
Indiana is one of a few states that house most of its long-term care programs for
the frail elderly, younger adults with disabilities and persons with developmental
disabilities within the same administrative unit. Indiana makes heavy use of
institutional services to serve the first two populations. In FY2001, $1.1 billion, or
more than 27% of all Medicaid spending, was for care in institutions. Nursing home
spending accounted for almost two-thirds of Medicaid long-term care spending;
services in intermediate care facilities for the mentally retarded accounted for 23%;
and home and community-based services accounted for almost 15%.
Slow-moving waiting lists for home and community-based services have been
a problem for the state and quality of care issues caused the state to revamp its
primary program for persons with developmental disabilities. The state replaced its
former program and implemented new quality assurance mechanisms, including use
of routine, independent audits.
This study was funded in part by a grant from the Jewish Healthcare Foundation
and by a grant from the U.S. Department of Health and Human Services, Office of
Rural Health Policy, Health Resources and Services Administration.

Contents
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Introduction: Federal Legislative Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
A CRS Review of Ten States: Report on Indiana . . . . . . . . . . . . . . . . . . . . . . . . . 5
Summary Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Demographic Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Administration of Long-Term Care Programs . . . . . . . . . . . . . . . . . . . . . . . . 5
Trends in Institutional Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Trends in Home and Community-Based Care . . . . . . . . . . . . . . . . . . . . . . . . 6
Long-Term Care Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Issues in Financing and Delivery of Long-Term Care . . . . . . . . . . . . . . . . . . 6
Demographic Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Need for Long-Term Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Administration of Long-Term Care Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Indiana’s Long-Term Care Services for the Elderly
and Persons with Disabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Trends in Institutional Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Trends in Home and Community-Based Care . . . . . . . . . . . . . . . . . . . . . . . 12
Medicaid Section 1915(c) Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
State Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Medicaid Policy Affecting Consumers of Long-Term Care . . . . . . . . 14
Indiana’s Long-Term Care Services for Persons with Mental Retardation
and Developmental Disabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Trends in Institutional Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Trends in Home and Community-Based Care . . . . . . . . . . . . . . . . . . . . . . . 17
Financing of Long-Term Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Medicaid Spending in Indiana . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Medicaid Long-Term Care Spending in Indiana . . . . . . . . . . . . . . . . . . . . . 20
Issues in Long-Term Care in Indiana . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Institutional Bias . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Labor Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Consumer Direction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Housing and Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Quality Assurance Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Waiting Lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Additional Reading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

List of Figures
Figure 1. Percentage Population Increase Over 2000 in Indiana . . . . . . . . . . . . . 8
Figure 2. Institutional and Home and Community-Based Services as a
Percent of Medicaid Long-Term Care Spending in Indiana, 1990-2001 . . . 21
Figure 3. Medicaid Long-Term Care Spending in Indiana by Category,
FY1990 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Figure 4. Medicaid Long-Term Care Spending in Indiana by Category,
FY2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Figure 5. Medicaid Home and Community-Based Services Waiver
Spending by Target Population in Indiana, FY2001 . . . . . . . . . . . . . . . . . . 24
List of Tables
Table 1. Indiana Population Age 65 and Older, 1990 and 2000 . . . . . . . . . . . . . . 7
Table 2. Elderly Population as a Percent of Total Population, Indiana
and the United States, 2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Table 3. Estimated Number of Persons with Two or More Limitations
in Activities of Daily Living (ADLs), by Poverty Status, in Indiana . . . . . . . 9
Table 4. Nursing Home Characteristics in Indiana and the United States . . . . . 11
Table 5. Persons with Mental Retardation and Development Disabilities
Served in Residential Settings, by Size of Setting, 1990, 1995, and 2000 . 16
Table 6. Share of State Spending by Category, Indiana and the United States,
1990-2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Table 7. State Spending for Medicaid as a Percent of Total State Spending,
Indiana and the United States, 1990-2001 . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Table 8. Medicaid Long-Term Care Spending in Indiana, FY1990-FY2001 . . . 21
Table 9. Medicaid Spending in Indiana, Total Spending and Long-Term
Care Spending by Category and Percent Change, FY1990-FY2001 . . . . . . 22
Appendix 1. Major Home and Community-Based Long-Term Care Programs
for the Elderly and Persons with Disabilities in Indiana . . . . . . . . . . . . . . . 27
Appendix 2. Large State MR/DD Facilities, 1960-2001, Including
Facility Population, Per Diem Expenditure, and Closures (IN) . . . . . . . . . . 35
Appendix 3. About the Census Population Projections . . . . . . . . . . . . . . . . . . . 36
Acknowledgments
CRS wishes to acknowledge the generous time and contributions of the many
state officials and stakeholders who provided information on long-term care services
in Indiana. Without their generous time and invaluable experience and insight, this
report would not be possible. We would particularly like to thank officials from the
Indiana Family and Social Services Administration. We would also like to thank the
advocates and providers who offered valuable perspectives on the long-term care
system in Indiana.
The authors gratefully acknowledge the excellent assistance of Rashelle Butts
in the production of this report.

Preface
Demographic challenges posed by the growing elderly population and demands
for greater public commitment to home and community-based care for persons with
disabilities have drawn the attention of federal and state policymakers for some time.
Spending on long-term care by both the public and private sectors is significant. In
2001, spending for long-term care services for persons of all ages represented 12.2%
of all personal health care spending (almost $152 billion of $1.24 trillion). Federal
and state governments accounted for almost two-thirds of all spending. By far, the
primary payor for long-term care is the federal-state Medicaid program, which paid
for almost half of all U.S. long-term care spending in 2001.
Federal and state Medicaid spending for long-term care in FY2001 was about
$75 billion, representing over one-third of all Medicaid spending. Over 70% of
Medicaid long-term care spending was for institutions — nursing homes and
intermediate care facilities for the mentally retarded (ICFs/MR). Many believe that
the current federal financing system paid through Medicaid is structurally biased in
favor of institutional care. State governments face significant challenges in
refocusing care systems, given the structure of current federal financing. Many states
have devoted significant efforts to change their long-term care systems to expand
home and community-based services for persons with disabilities and their families.
Nevertheless, financing of nursing home care — primarily through the Medicaid
program — still dominates most states’ spending on long-term care today.
While some advocates maintain that the federal government should play a larger
role in providing support for home and community-based care, Congress has not yet
decided whether or how to change current federal policy. One possibility is that
Congress may continue an incremental approach to long-term care, without major
federal policy involvement, leaving to state governments the responsibility for
developing strategies that support home and community-based care within existing
federal funding constraints and program rules.
To help Congress review various policy alternatives and to assist policymakers
understand issues that states face in development of long-term care services, the
Congressional Research Service (CRS) undertook a study of 10 states in 2002. The
research was undertaken to look at state policies on long-term care as well as trends
in both institutional and home and community-based care for persons with
disabilities (the elderly, persons with mental retardation, and other adults with
disabilities). The research included a review of state documents and data on long-
term care, as well as national data sources on spending. CRS interviewed state
officials responsible for long-term care, a wide range of stakeholders and, in some
cases, members or staff of state legislatures.
The 10 states included in the study are: Arizona, Florida, Illinois, Indiana,
Louisiana, Maine, Oklahoma, Oregon, Pennsylvania, and Texas. States were chosen
according to a number of variables, including geographic distribution, demographic
trends, and approaches to financing, administration and delivery of long-term care
services.
This report presents background and analysis about long-term care in Indiana.

A CRS Review of 10 States: Home and
Community-Based Services — States Seek
to Change the Face of Long-Term Care:
Indiana
Introduction: Federal Legislative Perspective
States choosing to
The Social Security Amendments of 1965, which
modify their programs for
created the Medicaid program, required states to
l o n g - t e r m c a r e f a c e
provide skilled nursing facility services under their
sign i f i can t challenges.
state Medicaid plans, and gave nursing home care the
Financing of nursing home
same level of priority as hospital and physician
care has dominated long-term
services.
care spending for decades.
“Section 1902 (a). A State plan for medical assistance
The federal financing
must provide for inclusion of some institutional and
structure that created
some noninstitutional care and services, and, effective
incentives to support
July 1, 1967, provide (A) for inclusion of at least... (1)
institutional care reaches
inpatient hospital services...; (2) outpatient hospital
back to 1965. A number of
services; (3) other laboratory and X-ray services; (4)
converging factors have
skilled nursing home services (other than services in
an institution for tuberculosis or mental diseases) for
supported reliance on nursing
individuals 21 years of age or older; (5) physicians’
home spending. Prior to
services....;” P.L. 89-97, July 30, 1965.
enactment of Medicaid,
homes for the aged and other
public institutions were
financed by a combination of
direct payments made by individuals with their Social Security Old Age Assistance
(OAA) benefits, and vendor payments made by states with federal matching
payments on behalf of individuals. The Kerr-Mills Medical Assistance to the Aged
(MAA) program, enacted in 1960, a predecessor to Medicaid, allowed states to
provide medical services, including skilled nursing home services, to persons who
were not eligible for OAA cash payments, thereby expanding the eligible population.1
In 1965, when Kerr-Mills was transformed into the federal-state Medicaid
program, Congress created an entitlement to skilled nursing facility care under the
expanded program. The Social Security Amendments of 1965 required that states
provide skilled nursing facility services and gave nursing home care the same level
of priority as hospital and physician services. Amendments in 1967 allowed states
1 CRS Report 83-181, Nursing Home Legislation: Issues and Policies , by Maureen Baltay.
(Archived report; available from CRS upon request.)

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to provide care in “intermediate care facilities” (ICFs) for persons who did not need
skilled nursing home care, but needed more than room and board. In 1987, Congress
eliminated the distinction between skilled nursing facilities and intermediate care
facilities (effective in 1990). As a result of these various amendments, people
eligible under the state’s Medicaid plan are entitled to nursing home facility care; that
is, if a person meets the state’s income and asset requirements, as well as the state’s
functional eligibility requirements for entry into a nursing home, he or she is entitled
to the benefit.
These early legislative developments were the basis for the beginnings of the
modern day nursing home industry. Significant growth in the number of nursing
homes occurred during the 1960s — from 1960 to 1970, the number of homes more
than doubled, from 9,582 to almost 23,000, and the number of beds more than
tripled, from 331,000 to more
than one million.2 (In 2003,
Since its inception, Medicaid has been the predominant
there were about 16,400
payor for nursing home care. In 1970, over $1 billion was
nursing homes with 1.8
spent on nursing home care through Medicaid and
million beds.3)
Medicare. Federal and state Medicaid payments
accounted for almost all of this spending — 87%.
Medicaid spending for nursing home care grew by 50% in
During the latter part of
the three-year period beginning in 1967.
the 1960s and the 1970s,
nursing home care attracted a
In FY2001, Medicaid spent $53.1 billion on institutional
care (for nursing homes and care in intermediate care
great deal of congressional
facilities for the mentally retarded).
oversight as a result of
concern about increasing
federal expenditures, and a
pattern of instances of fraud
and abuse that was becoming evident. Between 1969 and 1976, the Subcommittee
on Long-Term Care of the Senate Special Committee on Aging, held 30 hearings on
problems in the nursing home industry.4
Home care services received some congressional attention in the authorizing
statute — home health care services were one of the optional services that states
could provide under the 1965 law. Three years later in 1968, Congress amended the
law to require states to provide home health care services to persons entitled to
skilled nursing facility care as part of their state Medicaid plans (effective in 1970).
During the 1970s, the Department of Health, Education and Welfare (now
Department of Health and Human Services, DHHS) devoted attention to “alternatives
to nursing home care” through a variety of federal research and demonstration efforts.
These efforts were undertaken not only to find ways to offset the high costs of
2 U.S. Congress, Senate Special Committee on Aging, Developments in Aging, 1970,
Report 92-46, Feb. 16, 1970, Washington, cited from the American Nursing Home
Association Fact Book, 1969-1970.
3 Centers for Medicare and Medicaid Services, Health Care Industry Update, Nursing
Facilities, May 20, 2003.
4 U.S. Congress, Senate Special Committee on Aging, Nursing Home Care in the United
States: Failure of Public Policy, Washington, 1974, and supporting papers published in
succeeding years.

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nursing facility care, but also to respond to the desires of persons with disabilities to
remain in their homes and in community settings, rather than in institutions.
However, it was not until 1981 that Congress took significant legislative action to
expand home and community-based services through Medicaid when it authorized
the Medicaid Section 1915(c) home and community-based waiver program.
Under that authority (known then as the Section 2176 waiver program), the
Secretary of DHHS may waive certain Medicaid state plan requirements to allow
states to cover a wide range of home and community-based services to persons who
otherwise meet the state’s eligibility requirements for institutional care. The waiver
provision was designed to alter the emphasis in the Medicaid program on
institutional care. Services under the Section 1915(c) waiver include: case
management, personal care, homemaker, home health aide, adult day care,
habilitation, environmental modifications, among many others.5 These services are
covered as an option of states, and under the law, persons are not entitled to these
services as they are to nursing facility care. Moreover, states are allowed to set cost
caps and limits on the numbers and types of persons to be served under their wavier
programs.
Notwithstanding wide use of the Section 1915(c) waiver authority by states over
the last two decades, total spending for Medicaid home and community-based
services waivers is significantly less than institutional care — about $14.4 billion in
2001, compared to $53.1 billion for nursing facility care services and care for persons
with mental retardation in intermediate care facilities (ICFs/MR). Despite this
disparity in spending, in many states the Section 1915(c) waiver program is the
primary source of financial support for a wide range of home and community-based
services, and funding has been increasing steadily. Federal and state Medicaid
support for the waiver programs increased by over 807% from FY1990 to FY2001
(in constant 2001 dollars).
The home and community-based waiver program has been a significant source
of support to care for persons with mental retardation and developmental disabilities
as states have closed large state institutions for these persons over the last two
decades. Nationally, in FY2001, almost 75% of Section 1915(c) waiver funding was
devoted to providing services to these individuals.
States administer their long-term care programs against this backdrop of federal
legislative initiatives — first, the entitlement to nursing home care, and requirement
to provide home health services to persons entitled to nursing home care, and,
second, the option to provide a wide range of home and community-based services
5 States may waive the following Medicaid requirements: (1) statewideness — states may
cover services in only a portion of the state, rather than in all geographic jurisdictions; (2)
comparability of services — states may cover state-selected groups of persons, rather than
all persons otherwise eligible; and (3) financial eligibility requirements — states may use
more liberal income requirements for persons needing home and community-based waiver
services than would otherwise apply to persons living in the community. For further
information, see CRS Report RL31163, Long-Term Care: A Profile of Medicaid 1915(c)
Home and Community-Based Services Waivers, by Carol O’Shaughnessy and Rachel Kelly.

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through waiver of federal law, within state-defined eligibility requirements, service
availability, and limits on numbers of persons served.

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A CRS Review of Ten States: Report on Indiana
Summary Overview
! Indiana has an innovative home and community services system for
those adults with disabilities who are able to access it. Funding
comes from a Medicaid Section 1915(c) home and community-based
services waiver and a generous, non-means-tested state-funded
program. The state spends a large proportion of its Medicaid long-
term care funds on institutional care.
Demographic Trends
! Indiana is the 14th largest state in the country with 6.1 million people
in 2000; the population increased by 9.7% or about half a million
people from 1990-2000. About 12.4% of its population is aged 65
and older — 752,831 people in 2000. The state’s oldest population
is growing quite rapidly; those aged 85 and older grew by 27.6%
from 1990-2000.
! Persons aged 85 and over with two or more limitations in activities
of daily living (ADLs) in Indiana are estimated to increase 22.8% by
2010 to reach over 11,000 people. The number of persons aged 18
to 64 with the same level of disability is estimated to increase by
3.7% reaching 15,340 or 25.8% of all adults with limitations in two
or more ADLs in 2010. Growth in the number of adults of all ages
with disabilities will place pressure on public and private long-term
care resources.
Administration of Long-Term Care Programs
! Indiana is one of the few states to house most of its home and
community-based services programs for the frail elderly, younger
adults with disabilities and persons with developmental disabilities
within the same administrative unit — the Family and Social
Services Administration (FSSA). Within that larger unit, these long-
term care functions are spread across two bureaus and one office
within FSSA. Indiana’s Department of Health regulates nursing
homes.
! The state has a single point of entry for these programs and an
innovative, electronically-based assessment and case management
system.
Trends in Institutional Care
! In 2000, Indiana had 572 nursing facilities with 56,990 beds, with a
relatively low occupancy rate of 74.8%. The number of beds per
1,000 persons age 65 and older is 75.7, much higher than the
national rate of 52.7; the state’s ratio for persons age 85 and over is
also much higher than the national rate. The relatively low
occupancy rates combined with the high ratio of nursing home beds

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to older persons implies that the state has much excess capacity in
its nursing home industry.
! Residential care for persons with developmental disabilities has
shifted to care in smaller settings over the period from 1990-2000 in
Indiana. Persons with developmental disabilities living in large
institutions with 16 or more residents declined from 53% of all such
persons living in group residences in 1990 to 32% in 2000, while the
proportion residing in homes with six persons or fewer persons grew
from about one-third in 1990 to 44% in 2000.
Trends in Home and Community-Based Care
! The state uses a combination of Medicaid Section 1915(c) home and
community-based services waivers and a large totally state-funded
program to provide home and community services to persons with
disabilities through the IN-Home Services program. The state-
funded program, Community and Home Options to Institutional
Care for the Elderly and Disabled (CHOICE), funded at $34.3
million in State Fiscal Year (SFY) 2002, has more generous
financial eligibility standards than used under Medicaid and very
flexible services.
! In 1992, Indiana started its Medicaid Section 1915(c) home and
community-based Intermediate Care Facility for the Mentally
Retarded Waiver (ICF/MR Waiver) to provide home and community
services for persons with mental retardation. This program was
replaced with the Developmental Disabilities Waiver in 2001 as a
result of some serious quality problems uncovered by a federal audit.
The state also has two other Section 1915(c) waiver programs to
help persons with developmental disabilities remain at home.
Long-Term Care Spending
! In FY2001, $1.1 billion or 27.4% of all Medicaid spending in
Indiana was for care in institutions — nursing homes and
intermediate care facilities for persons with mental retardation
(ICFs/MR). Nursing home spending accounted for almost three-
quarters of Medicaid institutional spending and almost two-thirds of
Medicaid long-term care spending. In the same year, home and
community-based services accounted for almost 15% of all
Medicaid spending.
! Spending for Medicaid home and community-based services
increased by over 958% from FY1990 to FY2001, while spending
for institutional care increased at a slower pace — by 38% over the
same period (in constant 2001 dollars).
Issues in Financing and Delivery of Long-Term Care
! Waiting lists for home and community-based services have been a
persistent problem in Indiana. The state-funded CHOICE program
had a waiting list of over 8,500 persons in SFY2002, a decrease

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from almost 12,000 persons in SFY2001. Some state interviewees
said that the number of persons on the waiting list may not be a good
indication of who needs services, because some people join the list
before they really need care. Other interviewees said that the top
three ways of getting off the list are, in order, 1) to die, 2) go into a
nursing home, or 3) to receive services, generally after a wait of 3.5
to 4 years.
! Indiana has had quality problems in its Section 1915(c) home and
community-based services waivers for persons with developmental
disabilities. As a result, the state implemented new quality
assurance mechanisms, including use of routine, independent audits.
Demographic Trends
Indiana is the 14th largest state in the country with 6.1 million people in 2000; the
population increased by 9.7% or about half a million people in the past decade. In
2000, 12.4% of the state’s population or 752,831 people were aged 65 and older.
The state’s oldest populations grew quite rapidly during the 1990s — those aged 75-
84 grew by almost 20% and those 85 and older grew by 27.6% from 1990-2000.
(See Table 1.)
Table 1. Indiana Population Age 65 and Older, 1990 and 2000
2000
1990
2000
population
Percent of
Percent of
rank in U.S
total
total
Percent change
(based on
Age
Number
population
Number
population
1990-2000
percent)
65+
696,196
12.6%
752,831
12.4%
8.1%
28th
65-74
(402,041)
(7.3%)
395,393
(6.5%)
-1.7%
32nd
75-84
(222,404)
(4.0%)
265,880
(4.4%)
19.5%
27th
85+
(71,751)
(1.3%)
91,558
(1.5%)
27.6%
28th
Under 65
4,847,963
87.4%
5,327,654
87.6%
9.9%
24th
Total pop.
5,544,159 100.0%
6,080,485
100%
9.7%
14th
Source: U.S. Census Bureau, Profile of General Demographics for Indiana: 1990; 2000:
[http://www.census.gov/census2000/states/me.html]. Percentages may not sum to 100% due to
rounding.
Indiana, along with the rest of the country, will experience large increases in its
older population over the next 25 years. In 2025, 19.2% of Indiana’s population will
be aged 65 years or older, compared to 18.5% for the nation (See Table 2).

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Figure 1. Percentage Population Increase Over 2000 in Indiana
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2005
2010
2015
2020
2025
65-74
75-84
85+
65+
Total
Under 65
Source: CRS calculations based on data from the U.S. Census Bureau. Projections:
[http://www.census.gov/population/www/projections/st_yrby5.html]; analyzed data from State
Population Projections: Every Fifth Year.
Table 2. Elderly Population as a Percent of Total Population,
Indiana and the United States, 2025
Proportion of total population in
Proportion of total population in
Age
2025 in Indiana
2025 in U.S.
65-74
11.0%
10.5%
75-84
6.1%
5.8%
85+
2.2%
2.2%
65+
19.2%
18.5%
Under 65 pop.
80.8%
81.5%
Source: CRS calculations based on data from the U.S. Census Bureau. Projections:
[http://www.census.gov/population/www/projections/st_yrby5]; analyzed data from State Populations
Projections: Every Fifth Year.
Need for Long-Term Care
Table 3 presents estimates of the number of persons aged 18 and over in Indiana
who have limitations in two or more activities of daily living (ADLs) and thus may
need long-term care. These estimates were derived from data generated by The
Lewin Group and combine national level data on persons with disabilities with state-
level data from the U.S. Census Bureau on age, income, and broad measures of
disability. Persons aged 65 and over with two or more limitations in ADLs in
Indiana are estimated to increase by 11% to reach nearly 33,000 persons. The fastest
growth will be for those aged 85 and over with two or more limitations in ADLs who
are estimated to increase 23% by 2010 to reach over 11,000 persons. The number of
persons aged 18 to 64 with the same level of disability will increase by almost 4%
reaching over 15 thousand persons. Growth in the number of adults of all ages with
disabilities will place pressure on public and private long-term care resources.

CRS-9
Table 3. Estimated Number of Persons with Two or More
Limitations in Activities of Daily Living (ADLs), by Poverty
Status, in Indiana
2002
2005
2010
Percent
Persons with 2+ ADLs by age and income
of
poverty
18-64
65+
85+
18-64
65+
85+
18-64
65+
85+
Up to
2,795
3,968 1,033
2,852
4,110
1,114
2,898
4,372
1,269
100%
Up to
4,682
10,426 3,775
4,776
10,863
4,068
4,855
11,640
4,635
150%
Up to
6,346
15,404 5,384
6,473
16,039
5,802
6,580
17,140
6,611
200%
All
14,797
29,747 9,082
15,090
30,897
9,788
15,340
32,933
11,151
income
Source: CRS analysis based on projections generated by The Lewin Group through the HCBS State-
by-State Population Tool available online from [http://www.lewin.com/cltc]. The Lewin Group Center
on Long Term Care HCBS Population Tool, by Lisa M.B. Alecxih, and Ryan Foreman (2002).
Administration of Long-Term Care Programs
Indiana is one of the few states to house most of its home and community
services programs for the frail elderly, younger adults with disabilities and persons
with developmental disabilities within the same administrative unit — the Family
and Social Services Administration (FSSA). The long-term care functions are spread
across two bureaus and one office within FSSA. The Indiana Department of Health
regulates nursing homes.
The Bureau of Aging and In-Home Services (BAIHS) oversees the IN-Home
Services program for older persons and younger adults with disabilities who are at
risk of institutionalization. IN-Home Services encompasses the state-funded
CHOICE program; seven6 Medicaid Section 1915(c) home and community-based
waivers; and funding from the Older Americans Act, the Social Services Block
Grant, and state and local sources.
The BAIHS contracts with the statewide network of 16 area agencies on aging
(AAAs) which are the single point of entry for most community-based long-term care
services for older adults and persons of all ages with disabilities. Area agencies
administer IN-home Services for adults with disabilities at the local level.
6 Six of the state’s Medicaid Section 1915(c) waivers are described in this report. A
seventh waiver, the Medically Fragile Children Waiver, serves children under age 18 who
are in need of significant medical services, including those who are technologically
dependent. Recipients of these services must meet either skilled nursing facility level of care
or hospital level of care. This waiver is outside the scope of this report.

CRS-10
The state uses a data system called InSite to manage the IN-Home Services
Program. Case managers conduct home visits to assess applicants’ needs and
eligibility for services as well as to monitor quality; the resulting data go into a state-
maintained data base, which is used to produce care plans and data about service use
and quality.
In 1983, Indiana began pre-admission screening of all nursing home applicants
to ensure that they know about care options in the community. Area agencies on
aging perform, and are reimbursed for, the screenings; they performed 31,063
screenings in SFY2002 at a cost of $2.8 million.7 In addition, the Pre-Admission
Screening Resident Review (PASRR) program, enacted into federal law in 1987,
reviews the health and supportive care needs of persons who have a mental illness
or a developmental disability and who are applying to, or are residents of, Medicaid
certified nursing facilities to determine if their needs can be, or are being, met. The
PASRR program served over 9,000 persons in Indiana in SFY2002; expenditures for
PASRR were $3.3 million in SFY2002.
The FSSA Bureau of Developmental Disability Services (BDDS) administers all
institutional services for people with mental retardation and developmental
disabilities and controls all admissions to ICFs/MR. In 2002, administration of the
Medicaid Section 1915(c) Developmentally Disabled Waiver was transferred to
BDDS. Local BDDS units provide assessment and case management services to
persons with developmental disabilities.
FSSA’s Office of Medicaid Policy and Planning determines financial eligibility
for all Medicaid applicants. The Bureau of Quality Improvement Services monitors
the quality of Medicaid waiver programs and the Bureau of Fiscal Services
administers Medicaid waiver funding.
Indiana’s Long-Term Care Services for the Elderly
and Persons with Disabilities
Trends in Institutional Care
In 2000, Indiana had 572 nursing facilities with 56,990 beds, with a relatively low
occupancy rate of 74.8% (see Table 4). The number of beds per 1,000 persons aged
65 and older is 75.7, much higher than the national rate of 52.7. The state’s ratio is
622.4 beds per 1,000 persons age 85 and over, a figure also much higher than the
national rate of 434.8. The relatively low occupancy rates combined with the high
ratio of nursing home beds to older persons implies that the state has significant
excess capacity in its nursing home industry. There is no certificate of need process
in Indiana.
7 Indiana Family and Social Services Administration, Statewide IN-Home Services 2002
Annual Report, July 1, 2001-June 20, 2002, Indianapolis, IN, 2002.

CRS-11
Table 4. Nursing Home Characteristics in Indiana and the
United States
(Data are for 1999-2000)
Characteristics
Indiana
United States
Number of facilities
572
17,023
Number of residents
42,621
1,490,155
Number of beds
56,990
1,843,522
Number of Medicaid beds
18,357
841,458
Number of beds per 1,000 pop aged 65 and older
75.7
52.7
Number of beds per 1,000 pop aged 75 and older
159.4
111.1
Number of beds per 1,000 pop aged 85 and older
622.4
434.8
Occupancy rate
74.80%
80.8%
Source: American Health Care Association, Facts and Trends: The Nursing Facility Source Book.
Perhaps because of excess capacity, nursing homes across the state are closing,
according to state officials, regardless of the homes’ level of quality. Indiana has
implemented the Senior Security Plan to address the problems residents face when
their facilities close. The Plan involves Senior Care Teams that assist Medicaid-
eligible residents of closing nursing facilities to find another facility, or to transition
to home or community settings. The state plans to use former residents’ Medicaid
funding to pay for their services under the Medicaid Aged and Disabled Waiver. The
state expected to fund up to 1,000 of the state’s 10,000 unused Medicaid Aged and
Disabled waiver slots in this way in SFY2002. According to state officials, Indiana
did not have the expected number of persons leaving nursing facilities and therefore
did not obtain the funding for most of the unused slots. As a result, the waiver was
amended in October 2002 to decrease the maximum number of waiver slots to 6,000.
Indiana is addressing excess nursing home capacity in a number of ways. The
state received a nursing facility transition grant of $770,000 in 2001 from the U.S.
Department of Health and Human Services (DHHS) to move persons from nursing
homes into the community, and to divert persons who live in the community and are
at risk of nursing home placement from these facilities.8 Use of grant funds allows
area agencies on aging and nursing home ombudsmen to identify nursing home
residents with relatively low care needs and inform them about opportunities to move
into the community using waiver funding.
In addition, the state has established a nursing home occupancy standard to
address excess capacity. The state has stipulated that if any nursing facility has less
than a 75% occupancy level, then its Medicaid reimbursement amount would be
reduced. Some homes have decertified beds as a result of this rule.
8 [http://www.hcbs.org/compendium/web/indiana_nft.htm] accessed on Apr. 5, 2003.

CRS-12
Trends in Home and Community-Based Care
Indiana uses a combination of Medicaid Section 1915(c) home and community-
based services waivers and state funds to provide home and community services to
older persons and younger adults with disabilities through its IN-Home Services
program. Three waiver programs — the Aged and Disabled Wavier, the Traumatic
Brain Injury Waiver, and the Assisted Living Waiver — served 3,307 persons in
SFY2002; the state-funded CHOICE program, which uses more liberal functional
and financial eligibility tests than used by Medicaid waiver programs, served almost
four times that number.
Medicaid Section 1915(c) Waivers. All waiver participants must require
assistance with three or more of 14 activities of daily living (ADLs). The state’s
financial eligibility standards require that in order to be eligible for the waiver
programs, persons must have incomes at or below the Supplemental Security Income
(SSI) benefit standard ($552 per month in 2003) and have countable financial assets
of less than $1,500.9
Indiana has three Medicaid Section 1915(c) waivers serving older persons and
younger adults with disabilities. The Aged and Disabled Waiver is the largest and
served 3,154 persons in SFY2002. Services covered include adult day care, case
management, meals, home modifications, and respite care, among others. The
average monthly Medicaid expenditure under this waiver in SFY2002 was $644.
The state has had DHHS approval for many more slots than persons served for
a number of years; state funding constraints have not allowed the state to serve
persons up to the approved slot level.10 At the same time, its state-funded home and
community-based program (described below) has had an extensive waiting list.
The Traumatic Brain Injury Waiver targets persons who have suffered brain
injuries. The waiver had 200 slots in 2002. The number of slots has increased
dramatically since 2000, when the state had only 100 slots. The number of persons
served has also increased rather dramatically from 25 persons in SFY2000 to 146
persons in SFY2002. A wide range of services is available including case
management, therapies, companion, habilitation and residential services. The
average monthly Medicaid expenditure under this waiver in SFY2002 was $1,589.
The Assisted Living Facility Waiver began in July 2001; Indiana received
approval from DHHS in 2001 to cover 350 persons in assisted living in the first year,
9 Medicaid law provides for certain excluded assets, including an individual’s home; up to
$2,000 of household goods and personal effects; life insurance policies with a face value of
$1,500 or less; an automobile with value up to $4,500; and burial funds up to $1,500, among
other things.
10 Olmstead Real Choices Narrative downloaded from
[http://www.in.gov/fssa/servicedisabl/olmstead/realnar.html] on Feb. 1, 2002.

CRS-13
1,050 in the second and 2,250 in the third year of the waiver.11 In FY2002, seven
persons were served under the waiver. ALFs must give each resident his or her own
room with a lockable door, bathroom, and food preparation area. The average
monthly Medicaid expenditure under this waiver in SFY2002 was $1,177.
State Programs. There are a number of pathways that establish Medicaid
eligibility for home and community-based long-term care services. These include
coverage of persons whose income is 300% of the federal SSI payment level ($1,656
a month in 2003), as allowed under the Section 1915(c) waiver program. Despite the
availability of this more liberal standard, many people may need community care but
cannot meet Medicaid’s income limits or resource tests. Many of these persons
cannot establish eligibility until they spend-down almost all of their resources and
income, and, by that time, may be in danger of entering an institution. One of the
issues many states have confronted is how to serve these people.
Indiana has addressed this issue in part through its Community and Home
Options to Institutional Care for Elderly and Individuals with Disabilities (CHOICE)
program which is totally state-funded. There are no income and asset tests under the
CHOICE program, but persons with incomes at or above 150% of the federal poverty
level are required to contribute toward the costs of services, based on a sliding fee
scale. Persons with incomes at or above 351% of poverty are required to pay the full
cost of services.
CHOICE beneficiaries must have a long-term disability or be age 60 or older and
unable to perform two of 14 ADLs or Instrumental Activities of Daily Living
(IADLs);12 this standard is more liberal than the functional eligibility standard for the
Medicaid Section 1915(c)Aged and Disabled Waiver. The program provides all the
services provided by the Aged and Disabled Waiver in addition to other authorized
services that a person may need to remain at home. Examples of these services
include language translation and pest control services. The program was funded at
$34.3 million in SFY2002.
Many persons served by the CHOICE program are of advanced age; of 12,702
persons served in SFY2002, more than one-quarter were age 85 and over and one-
third were age 75-84 years old.
Waiting lists for home and community-based services have been a persistent
problem. In SFY2002, CHOICE had a waiting list of over 8,500 persons, a decrease
from almost 12,000 persons in SFY2001. State interviewees said that the top three
ways of getting off the list are, in order, 1) to die, 2) go into a nursing home, or 3)
receive services, generally after a wait of 3.5 to 4 years. However, some interviewees
said that the number of persons on the waiting list may not be a good indication of
need for services, because some people join the list before they really need care.
11 Bureau of Aging and In Home Services Annual Report 2001, Indianapolis, IN, 2001.
12 IADLs refer to activities necessary for independent community living, such as meal
preparation, shopping, light housework, telephoning, and money management.

CRS-14
Indiana is undertaking efforts to maximize Medicaid funding for home and
community-based services. First, the state is converting some CHOICE beneficiaries
to the Medicaid Aged and Disabled waiver to take advantage of the federal Medicaid
matching funds. The Centers for Medicare and Medicaid Services (CMS) has
allowed this as long as the additional federal funds are devoted to the waiver. In
addition, the state had plans to close a 30-year old, state-funded room and board
assistance program to new participants because the state is encouraging providers to
become assisted living facilities and participate in the Medicaid assisted living
facility waiver. The state had plans to use the program’s state funding to draw down
federal Medicaid matching funds.
Medicaid Policy Affecting Consumers of Long-Term Care. Two
aspects of Medicaid policy in Indiana affect consumers of long-term care. The first
is the state’s initiative to participate in a long-term care partnership program; the
second relates to the definition of disability for adults under age 65.
Long-Term Care Partnership Program. With funding from the Robert Wood
Johnson Foundation, Indiana established the Indiana Long Term Care Insurance
Program (ILTCIP) in 1993. The Long-Term Care Partnership program was initiated
by the Robert Wood Johnson (RWJ) Foundation in 1988. The purpose of the
program is to encourage the purchase of long-term care insurance and to blend public
financing (Medicaid) with private insurance. Indiana is one of four states that
implemented the program with funding from RWJ (the other states are California,
Connecticut and New York). Under the program, persons who purchase a certified
private long term care insurance policy may qualify for Medicaid once they exhaust
their insurance benefits. In return for purchasing insurance coverage, they may
qualify for Medicaid assistance without being required to meet Medicaid assets tests
and thereby protect some of their assets. The amount of assets protection is
dependent upon the amount of insurance coverage purchased. Applicants must,
however, meet Medicaid income and categorical eligibility requirements (age or
disability criteria).
In Indiana, insurance purchasers can receive “dollar for dollar” protection of their
assets, or protection of all of their assets, depending upon the amount of long-term
care insurance benefits they purchase. Purchasers can choose between nursing home-
only policies and those that cover home, community, and facility services. All
policies include inflation protection. In Indiana, as of April 2003, 22,285 insurance
policies were in effect; seven persons had qualified for Medicaid. Thirteen insurance
companies participate in the program.13
Definition of Disability. Before 2001, people under 65 could not qualify for
Medicaid on the basis of their disabilities, if their disabilities could improve with
proper medical treatment. In September 2000, the Indiana Court of Appeals ordered
the state to stop denying disability benefits on this basis. In June 2001, the Indiana
Supreme Court declined to hear the state’s appeal of the Court of Appeals decision.14
13 Data collected by CRS, summer 2003.
14 Petricia Day v. Indiana, Ind. Ct. App., No. 49A02-0001-CV-30, Sept. 29, 2000.

CRS-15
The state Supreme Court’s decision extended Medicaid coverage to those whose
disability is expected to last four years if left untreated.15 The previous standard had
required that a person have a permanent, untreatable disability; therefore, for
example, people with conditions such as cancer or kidney failure could not obtain
Medicaid coverage.16 The state had originally estimated the cost of compliance with
the decision to be $850 million; that figure declined to $130 million because just
3,665 of 17,559 persons who were contacted and expected to be eligible for Medicaid
actually applied, and were found eligible, for the program. The state contacted
people who were denied coverage between December 20, 1993 and December 2001.
Indiana’s Long-Term Care Services for Persons
with Mental Retardation and Developmental
Disabilities
Services to persons with mental retardation and other developmental disabilities
in the United States changed dramatically over the last half of the 20th century as a
result of a number of converging factors. These include the advocacy efforts of
families and organized constituency groups, various changes to the Social Security
law that provided payments to individuals through SSI and social security disability
insurance (SSDI) and to service providers through the Medicaid program, and
significant litigation brought on behalf of persons with mental retardation.17
Trends in Institutional Care
The early history of services to persons with developmental disabilities and
mental retardation is characterized by the development of large state institutions or
training schools begun during the latter part of the 19th century and continuing
through the first part of the 20th century. Between 1920 and 1967, institutions
quadrupled in size and peaked at almost 200,000 individuals nationwide in 165 free-
standing, state-operated mental retardation institutional facilities.18 Today, some
states are still faced with the legacy of large state-operated institutions.
Indiana, like many other states, has eliminated some of its large state facilities for
persons with mental retardation and developmental disabilities. The state closed five
15 Corcoran Kevin, “Medicaid Costs Under Budget,” Indianapolis Star, Aug. 2, 2002,
downloaded from [http://www.indystar.com/article.php?day02.html] on Aug. 15, 2002.
16 The old standard was stricter than SSI disability requirements. Under SSI, a person is
considered to be disabled if he or she is unable to engage in substantial gainful activity
because of a medically-determined physical or mental impairment.
17 For a detailed history of the development of services for persons with developmental
disabilities, see David Braddock, Richard Hemp, Susan Parish, and James Westrich, The
State of the States in Developmental Disabilities, University of Illinois at Chicago:
American Association on Mental Retardation, 1988, Washington, D.C. (Hereafter cited as
Braddock, et al., The State of the States in Developmental Disabilities.)
18 Ibid.

CRS-16
of its 11 facilities between 1979 and 1998 and was scheduled to close another in
2003. Four of the five remaining facilities are more than 100 years old; the youngest
remaining facility opened in 1910. (See Appendix Table 2 for a list of the
institutions that have been closed and those in operation and their 2000 census.)
The nationwide trend in care for persons with developmental disabilities has been
to provide care in smaller community-based facilities. In Indiana, persons living in
large institutions with 16 or more residents declined from 53.1% of all persons living
in group residences in 1990 to 31.5% in 2000 (Table 5). The number of persons
living in group residences with 7-15 persons more than doubled between 1990 and
2000 to reach 2,754 in 2000, while the number of persons with developmental
disabilities in homes with six persons or fewer grew from 3,200 in 1990 to 4,958 in
2000.
Table 5. Persons with Mental Retardation and Development
Disabilities Served in Residential Settings, by Size of Setting,
1990, 1995, and 2000
Persons served by setting
1990
1995
2000
Setting by size
9,659
10,152
11,262
(100%)
(100%)
(100%)
16+ persons
5,132
4,507
3,550
(53.1%)
(44%)
(31.5%)
Nursing facilities
2,370
2,057
1,933
State institutions
1,983
1,299
782
Private ICF/MR
779
1,151
835
Other residential
0
0
0
7-15 persons
1,327
2,767
2,754
(13.7%)
(27.3%)
(24.5%)
Public ICF/MR
0
0
0
Private ICF/MR
1,327
2,767
2,754
Other residential
0
0
0
<6 persons
3,200
2,878
4,958
(33.1%)
(28.3%)
(44%)
Public ICF/MR
0
0
0
Private ICF/MR
2,000
1,028
1,037
Other residential
1,200
1,850
3,921
Source: David Braddock, ed., Disability at the Dawn of the 21st Century and the State of the States,
with Richard Hemp, Mary C. Rizzolo, Susan Parish, and Amy Pomeranz, American Association on
Mental Retardation, Washington, 2002.

CRS-17
Trends in Home and Community-Based Care
Indiana has three Medicaid Section 1915(c) waivers for persons with
developmental disabilities: the Home and Community-Based Waiver for Persons
with Developmental Disabilities (DD Waiver); the Support Services Waiver; and the
Autism Waiver, serving a total of 4,161 persons in SFY2002. In order to be eligible
for waiver services, persons must meet the level of care requirements provided in an
ICF/MR.
The state was relatively slow to set up its first waiver for persons with
developmental disabilities. It was not until 1992 that Indiana began its Intermediate
Care Facility for the Mentally Retarded Waiver (ICF/MR Waiver) (11 years after
enactment of the federal law). Use of the waiver program has affected the type of
care for persons with developmental disabilities in that care has been shifted to small
community-based settings. The ICF/MR waiver was replaced with the DD Waiver
in 2001. The replacement occurred because of serious quality problems that a routine
CMS regional office audit uncovered. The regional audit found that the state had
failed to insure a safe environment in the community-based waiver settings and that
case management and quality assurance systems were inadequate. Interviewees
indicated that safety problems occurred because three ICFs/MR with 40 beds each
closed and the state was forced to find placements for the residents quickly and
therefore placed residents in community-based waiver settings that turned out to be
unsafe.
The state reacted to the waiver audit in a number of ways. It moved
administration of the waiver from BAIHS to the Bureau of Developmental
Disabilities Services (BDDS) in 2001. In addition, the DD Waiver was modified to
give the state more flexibility to pay for beneficiary participation in community
activities, vocational skills training and transportation to community activities to
improve the quality of services. The state has also applied for a targeted case
management waiver to provide intensive case management to some persons and
began requiring 18 months of training for case managers. Persons with
developmental disabilities can choose between area agency on aging (AAA) case
managers and service coordinators from the BDDS field offices for intake activities;
they can choose between AAA case managers and private case managers for on-
going case management activities. To address quality, the state hired Electronic Data
Systems, Inc. (EDS) to audit at least 10% of developmental disability service
providers annually; this system was expanded to the aged and disabled waiver in
2002.
The average monthly Medicaid waiver expenditure in SFY2002 was $3,677.19
The Support Services Waiver, which began in April 2002, is designed to help
persons remain in their own homes by providing such services as caregiver support,
respite, adult day care, and a wide range of therapies. In SFY2002, 486 persons were
19 Telephone interview with Indiana Bureau of Developmental Disabilities Services staff.

CRS-18
served. The average monthly Medicaid waiver expenditure in SFY2002 was
$1,125.20
The Autism Waiver provides a broad array of services similar to those of the
Support Services Waiver; 267 persons were served under this waiver in SFY2002.
The average monthly Medicaid waiver expenditure in SFY2002 was $2,788.21
Financing of Long-Term Care
Medicaid is the chief source of financing for long-term care. In addition to state
matching of federal Medicaid funds, many states also devote significant resources of
their own to long-term care. In Indiana, the Medicaid program accounted for $1.3
billion in long-term care spending in FY2001; long-term care spending represented
almost one-third of all Medicaid spending.
Medicaid Spending in Indiana
Medicaid is a significant part of state budgets, representing the single largest
spending category in almost half the states. After elementary, secondary and higher
education spending, Medicaid spending was the largest share of state budgets in
2001. According to data compiled by the National Association of State Budget
Officers (NASBO), federal and state Medicaid spending represented 19.6% of state
budgets for the United States as a whole in 2001 (see Table 6).
In Indiana, Medicaid is the second largest category of federal and state spending
(after spending for elementary and secondary education), representing 18.7% of the
state’s $17.8 billion budget in 2001 (see Table 6). State spending for Medicaid
services in Indiana contributed from state funds only (excluding federal funds),22 as
a percent of total state spending, remained relatively stable during the 1990s. State
Medicaid spending as a percent of spending for all categories of state spending was
9.9% in 2001, compared to 8.1% in FY1990 (see Table 7).
20 Ibid.
21 Ibid.
22 Federal and state governments share the costs of Medicaid spending according to a
statutory formula based on a states’ relative per capita income (federal medical assistance
percentage or FMAP). In FY2001, the federal share for Medicaid in Indiana was 62.04%.

CRS-19
Table 6. Share of State Spending by Category, Indiana and the
United States, 1990-2001
Indiana
U.S. total
1990
1995
2000
2001
2001
Total
expenditure (in
$9,011
$12,778
$16,563
$17,767
$1,024,439
millions)
Medicaid
16.0%
18.0%
17.9%
18.7%
19.6%
Elementary &
Secondary
28.3%
26.1%
26.2%
26.1%
22.2%
Education
Higher
12.0%
8.0%
9.6%
8.6%
11.3%
Education
Public
1.6%
1.6%
0.5%
0.7%
2.2%
Assistance
Corrections
2.8%
2.9%
3.7%
3.5%
3.7%
Transportation
11.5%
8.8%
13.8%
13.8%
8.9%
All other
27.8%
34.5%
28.3%
28.6%
32.1%
expenses
Source: CRS calculations based on data from the National Association of State Budget Officers
(NASBO), State Expenditure Reports for 1992, 1997 and 2001. Data reported are for state fiscal
years and include federal funds that are spent by states. Percentages may not sum to 100% due to
rounding.
Table 7. State Spending for Medicaid as a Percent of Total State
Spending, Indiana and the United States, 1990-2001
Indiana
All states
State spending
1990
1995
2000
2001
2001
Total state spending (in
millions)a
$6,813
$9,392
$12,241
$12,822
$760,419
State Medicaid spending
(millions)b
$552
$861
$1,118
$1,271
$85,141
State Medicaid spending as
a percent of total state
8.1%
9.2%
9.1%
9.9%
11.2%
spending
Source: CRS calculations based on data from the National Association of State Budget Officers
(NASBO), State Expenditure Reports for 1991, 1997 and 2001. Data reported are for state fiscal
years. Percentages may not sum to 100% due to rounding.
a. Total state spending for all spending categories, excluding federal funds.
b. State spending for Medicaid, exclusive of federal funds. For FY1995, includes $4 million in
community residential facilities for the developmentally disabled (CRF/DD) for nursing facilities,
and disproportionate share hospital (DSH) payments of $38.8 million. These funds represented
0.5% and 4.5% of total state funded Medicaid expenditures.

CRS-20
Medicaid Long-Term Care Spending in Indiana
Long-term care spending represented almost one-third of all Medicaid spending
in Indiana in FY2001, a decrease from 43.8% in 1990 (see Table 8). Institutional
care is a significant share of these expenditures at 85.3%.
From 1990-2001, spending for home and community-based services as a
proportion of total long-term care spending grew 958.1% (in constant 2001 dollars)
to reach 14.7% of long-term care spending in FY2001 (see Table 9). The fast rate
of growth in Medicaid home and community-based services largely occurred because
Indiana did not rely on Medicaid to support these services in 1990. Its use of
Medicaid Section 1915(c) home and community-based services waivers is the
primary reason for the increase; spending for waiver programs increased by over
700% over the 11 year
period. In contrast,
i n s t i t u t i o n a l c a r e
Medicaid long-term care financing in Indiana at a glance:
spending grew at a
Spending for nursing homes represented 20.1% of total Medicaid
much slower pace —
spending in FY2001.
by 38% over the same
period (see Table 9).
Spending for nursing home care grew by 37.8% from FY1990-
FY2001, less than the 114.8% increase in total Medicaid
In FY2001, $1.1
spending.
billion, or 27.4% of all
Spending for nursing home care decreased as a percentage of
Medicaid spending,
long-term care spending — from 72% in FY1990 to 63% in
was for care in
FY2001. During the same period, the portion spent on ICFs/MR
i n s t i t u t i o n s ; a n d
decreased only slightly (from 26% to 23%) of long-term care
spending. .
nursing home spending
accounted for almost
In FY2001, 14.7% of Medicaid dollars spent on long-term care
three-quarters of total
was for home and community-based services. Spending
institutional spending
increased dramatically from FY1990-FY2001, by 958% (in
In the same year, home
constant 2001 dollars), primarily due to expanded use of the
home and community-based waiver program.
and community-based
services accounted for
4.7% of all Medicaid
spending (see Table 9).

CRS-21
Table 8. Medicaid Long-Term Care Spending in Indiana,
FY1990-FY2001
Indiana
1990
1995
2000
2001
Long-term care spending as a percentage of
43.8%
40.4%
33.9%
32.2%
Medicaid spending
Institutional care spending as a percentage of
97.8%
95.4%
86.8%
85.3%
long-term care spending
Nursing home spending as a percentage of
71.7%
66.9%
65.0%
62.6%
long-term care spending
ICF/MRa spending as a percentage of long-
26.2%
28.5%
21.8%
22.7%
term care spending
Total home and community-based services
spending as a percentage of long-term care
2.2%
4.6%
13.2%
14.7%
spending
HCBS waivers spending as a percentage of
long-term care spendingb
0
1.4%
9.0%
10.7%
Source: CRS calculations based on CMS/HCFA 64 data provide by The Medstat Group, Inc. For
2000 and 2001, Brian Burwell, et al., Medicaid Long-Term Care Expenditures in FY2001, May 10,
2002. For 1995, Brian Burwell, Medicaid Long-Term Care Expenditures in FY2000, May 7, 2001.
For 1990, Brian Burwell, Medicaid Expenditures for FY1991, Systemetrics/McGraw-Hill Healthcare
Management Group, Jan. 10, 1992. (Hereafter cited as Burwell, Medicaid Expenditures FY1991-
FY2001.) Total Medicaid spending in 1990 based on HCFA 64 data provided by The Urban Institute,
Washington, D.C. Numbers may not sum to 100% due to rounding.
a. Intermediate care facilities for persons with mental retardation.
b. For FY1990, amount is less than 0.005%.
Figure 2. Institutional and Home and Community-Based Services as a
Percent of Medicaid Long-Term Care Spending in Indiana, 1990-2001
100%
90%
$636.8
$974.7 mil ion
80%
million
$1,114.4
70%
million
60%
50%
40%
30%
$192.4
$14.3
20%
million
million
$47.0 mil ion
10%
0%
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Institutional Care (Nursing Home and ICF-MR)
Noninstitutional Care (Home Health, Personal Care and HCBS Waivers)
Source: CRS calculations based on Burwell, Medicaid Expenditures FY1991-FY2001. Total
Medicaid spending for 1990 based on HCFA 64 data provided by Urban Institute, Washington, D.C.

CRS-22
Table 9. Medicaid Spending in Indiana, Total Spending and
Long-Term Care Spending by Category and Percent Change,
FY1990-FY2001
(dollars in millions)
Percent
change 1990-
2001 (in
constant 2001
1990
1995
2000
2001
dollars)
Total Medicaid
$1,486.9
$2,528.7
$3,489.9
$4,061.8
114.8%
Total long term care*
$651.1
$1,021.7
$1,184.5
$1,306.7
57.9%
Total institutional care
$636.8
$974.7
$1,028.5
$1,114.4
37.6%
Nursing home services
$466.5
$683.5
$770.0
$817.5
37.8%
ICF-MR**
$170.3
$291.2
$258.5
$296.8
37.1%
Total home and
community-based
$14.3
$47.0
$156.0
$192.4
958.1%
services
Home health
$14.1
$33.0
$48.7
$51.9
189.8%
Personal care
$0.0
$0.0
$0.3
$0.0***
—
HCBS waivers
$0.2
$14.0
$107.0
$140.5
701.5%
Source: CRS calculations based on Burwell, Medicaid Expenditures FY1991-FY2000. FY1990 total
Medicaid spending based on CMS/HCFA 64 data provided by The Urban Institute, Washington, D.C.
Note: Actual dollars in millions. Percent change calculated using constant dollars.
* Long Term Care includes only Medicaid LTC spending — neither private pay, Medicare, nor state
programs are included.
**ICF-MR stands for Intermediate Care Facility for the Mentally Retarded.
***Actual expenditure is $12,175.
Figures 3 and 4 depict changes in long-term care spending patterns from
FY1990-FY2001. In FY1990, over one-quarter of Medicaid long-term care spending
was devoted to care for persons with developmental disabilities in ICFs/MR; the
figure decreased only slightly to 22.7% in FY2001. The proportion of spending on
nursing home services declined during that time period from 71.7% to 62.6%.
Spending on home and community services increased from 2.2% to 14.7% of long-
term care expenditures, primarily due to the expansion of Section 1915(c) waivers.
Not included in these amounts, however, is funding for the state-funded CHOICE
program, which accounted for $38.8 million in SFY2001 (and $34.3 million in
SFY2002).

CRS-23
Figure 3. Medicaid Long-Term Care Spending in Indiana by Category,
FY1990
Total Medicaid LTC Spending: $651.1 million
ICF-MR
Home Health
26.1%
2.2%
Ho me &
Co mmunity-B ased
Services
Nursing Hom e
2.2%
Services
71.7%
HCBS Waiver
0.0%
Source: CRS calculations based on Burwell, Medicaid Expenditures FY1991-FY2001.
Figure 4. Medicaid Long-Term Care Spending in Indiana by Category,
FY2001
Medicaid LTC Spending by Category in Indiana, 2001
Total Medicaid LTC Spending: $1,306.7 million
Home Health
ICF-MR
4.0%
22.7%
Home & Community-
Based Services
14.7%
Nursing Home
Services
HCBS Waiver
62.6%
10.7%
Source: CRS calculations based on Burwell, Medicaid Expenditures FY1991-FY2001. Percentages
may not sum due to rounding.

CRS-24
Increased funding for Section 1915(c) waiver services does not affect all
populations equally. In FY2001, 12.6% of waiver spending in Indiana was devoted
to services for the elderly and other adults with physical disabilities; services for
persons with mental retardation and developmental disabilities accounted for 85.4%
of waiver spending in FY2001 (see Figure 56).
Figure 5. Medicaid Home and Community-Based Services Waiver
Spending by Target Population in Indiana, FY2001
Total Medicaid HCBS Waiver Spending: $140.5 mil ion
Aged
Disabled
Waivers
12.6%
MR/DD
Other Waivers
Waivers
2.0%
85.4%
Source: CRS calculations based on Medicaid HCBS Waiver Expenditures, FY1995-FY2001, by Steve
Eiken and Brian Burwell, The Medstat Group, Inc., May 13, 2002.
Issues in Long-Term Care in Indiana
The following discussion highlights the issues raised in state reports collected for
this project and interviews with state officials and key stakeholders conducted during
the site visit to Indiana in the summer of 2002.
Institutional Bias. Most interviewees indicated their belief that the state has
an institutional bias toward care in nursing facilities for frail older persons and
younger adults with disabilities. In response, the state has taken several steps to
increase use of home and community-based services. The state has expanded the
number of slots in several Medicaid Section 1915(c) waivers. In addition, in 2002,
Governor O’Bannon’s administration received a Systems Change grant from the
Department of Health and Human Services to create the Governor’s Commission on
Home and Community Based Care to increase opportunities for persons with
disabilities to live in the community. Methods to be examined include increased
housing and transportation options, initiation of projects to allow persons to direct
their own care, and ways to train and retain caregivers.

CRS-25
Labor Issues. Most interviewees agreed that all long-term care providers face
a labor shortage that is affecting quality of care — some people do not receive
services in the community and continuity of care is affected in nursing homes. The
shortage involves licensed nurses in addition to paraprofessional workers. The labor
shortage appears to be worse in rural areas. A labor shortage of a different sort
occurs among state and local officials. As in other states, programs have grown in
scope without concomitant increases in funding for the staff needed to administer
them.
Consumer Direction. The state has established pilot programs under the state-
funded CHOICE program to test consumer-directed personal assistance services but
the programs faltered because only a few area agencies on aging participated.
Interviewees attributed this reluctance to confusion about who is considered the
employer of the personal assistant and how taxes should be withheld.23 In 2001, the
legislature enacted a provision to provide CHOICE and waiver beneficiaries the
opportunity to recruit, hire, pay, supervise, and dismiss a personal services attendant.
Housing and Transportation. Interviewees view lack of affordable housing
and convenient transportation as major barriers to assist persons with disabilities to
remain in the community. Housing issues include (1) able-bodied people occupying
accessible housing that is designed for persons with disabilities and (2) the CHOICE
program limiting its home adaptations to one home with a $5,000 lifetime limit.
Transportation problems are exemplified by the situation in Indianapolis where
accessible buses cover only part of the city or some routes operate only once a day,
making going to work difficult, if not impossible, for persons with disabilities.
Quality Assurance Issues. Indiana has had quality problems in its Section
1915(c) home and community-based services waivers for persons with
developmental disabilities. As a result, the state replaced its former waiver with a
new one and implemented new quality assurance mechanisms, including use of
routine, independent audits.
Licensure standards for assisted living facilities have been a source of
controversy. Draft regulations were controversial because they would have required
discharge of residents if they had certain medical conditions or needed regular
assistance with two or more ADLs. At the time of the site visit (summer 2002), the
Department of Health was rewriting regulations to require facilities that provide
services themselves to obtain licensure but this would not be necessary if the
facilities hired an agency to deliver services in the facility.
Waiting Lists. The state-funded CHOICE program had a waiting list of 8,577
people in SFY2002, a decrease from 11,922 in SFY2001.24 Some interviewees said
that the number of persons on the waiting list may not be a good indication of who
needs services, because some people join the list before they really need care. Other
23 For further information on consumer direction in long-term care, see CRS Report
RL32219, Long-Term Care: Consumer- Directed Services Under Medicaid, by Karen Tritz.
24 Indiana Family and Social Services Administration. Statewide IN-Home Services 2002
Annual Report, July 1, 2001-June 20, 2002. Indianapolis, IN, 2002.

CRS-26
interviewees said that the top three ways of getting off the list are, in order, to die, go
into a nursing home, or to receive services, generally after a wait of 3.5 to 4 years.
The state also had a long waiting list for its Aged and Disabled Waiver, despite the
fact that it has many available waiver slots. Slots remain unused because the state
has not appropriated sufficient funds to fill them.

CRS-27
Appendix 1. Major Home and Community-Based Long-Term Care Programs
for the Elderly and Persons with Disabilities in Indiana
Functional eligibility
Financial eligibility
No. of
Annual cost
persons
cap
served/slots
(aggregate/
Target
Determined
Income/
Determined
Admin.
Financial
approved,
individual)
Program
group
Criteria
by
resource limits
by
Services
oversight
oversight
SFY2002
SFY2002
Aged and
Persons
Nursing facility Area agencies 100% of SSI
FSSA county Adaptive aids &
3,154 persons $117 a day
Office of
Office of
Disabled
aged 65
level of care
on aging
income limit/
offices
devices;
served/3,300
aggregate cap
Medicaid
Medicaid
Waiver
years and
$1,500 asset
adult day services;
slots approved
Policy and
Policy and
older and
People must
limit for an
attendant care;
Average cost
Planning
Planning
Medicaid 1915 adults with have difficulty
individual
case management;
per month,
(c) waiver
disabilities with 3 of 14
home-delivered meals;
$644
ADLs.
home modifications;
(weighted
Began in 1990
homemaker;
monthly
and was
respite care
average based
preceded by
on
another
participation
waiver in 1984
and length of
service)
Sources: Bureau of Aging and In Home Services Annual Report 2002, Indianapolis, IN, 2002.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADLs — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-28
No. of
persons
Functional eligibility
Financial eligibility
enrolled/
Annual cost
Income/
slots
cap (aggregate
Target
Determined
resource
Determined
approved,
individual)
Admin.
Financial
Program
group
Criteria
by
limits
by
Services
SFY2002
SFY2002
oversight
oversight
Traumatic
People
Nursing
Office of
100% of SSI FSSA county
Adult companion services;
146 persons
Aggregate
Office of
Office of
Brain
who have
facility
Medicaid
income limit/ offices
case management;
served/200
$112 a day
Medicaid
Medicaid
Injury
suffered
level of
Policy and
$1,500 asset
environmental modifications; slots approved
Policy and
Policy and
Waiver
injuries to
care
Planning
limit for an
occupational therapy;
Average cost
Planning
Planning
the brain
individual
personal care;
per month,
Medicaid
personal emergency response
$1,589
1915(c)
systems;
(weighted
waiver
physical therapy;
monthly
residential care/community
average based
Initiated in
residential services;
on
March 2000
respite care;
participation
speech/hearing/language
and length of
therapy;
service)
habilitation including
behavior counseling and
training
independent living skills
training;
pre-vocational services;
structured day program;
supported employment
Sources: Bureau of Aging and In Home Services Annual Report 2002, Indianapolis IN, 2002.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADL — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-29
No. of persons
Annual
Functional eligibility
Financial eligibility
enrolled/slots
cost cap
Target
Determined
Income/resource
Determined
approved in
(aggregate
Administrative
Financial
Program
group
Criteria
by
limits
by
Services
SFY2002
individual)
oversight
oversight
Assisted
Persons
Nursing
Office of
100% of SSI
FSSA county Case
Seven persons
Average cost
Office of
Office of
Living
with
facility level
Medicaid
income
offices
management; served
per month,
Medicaid Policy
Medicaid
Waiver
disabilities
of care
Policy and
limit/$1,500 asset
assisted
$1,177
Planning
Policy and
aged 18 and
Planning
limit for an
living
Approved slots:
(weighted
Planning
Medicaid
over
individual
350 in first year; monthly
1915(c)
1,050 in second
average based
waiver
year; and 2,250
on
in the third year
participation
Approved in
and length of
2001
service)
Sources: Bureau of Aging and In Home Services Annual Report 2002, Indianapolis, IN, 2002.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADL — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-30
No. of persons
Annual cost
Functional eligibility
Financial eligibility
enrolled/
cap
Target
Determined
Income/
Determined
slots approved
(aggregate/
Admin.
Financial
Program
group
Criteria
by
resource limits
by
Services
in SFY2002
individual)
oversight
oversight
Community
Persons age
People must
Area
None but
Area agencies Case management;
12,728 persons
Not
Bureau of
Bureau of
and Home
60 and over,
be unable to
agencies on
persons with
on aging
home health supplies
served
applicable
Aging and Aging and
Options to
or of any age perform two
aging
incomes above
and services;
IN-home
IN-home
Institutional
with
of 14 ADLs
150% of the
attendant care;
Spending
services
services
Care for
disabilities
and IADLs
federal poverty
homemaker; respite;
was $34.3
Elderly and
level pay cost
meals; adult day care;
million in
Individuals
sharing on a
transportation; other
SFY2002
with
sliding scale
necessary services
Disabilities
(CHOICE)
Persons with
incomes at or
State-funded.
above 351% of
CHOICE is
poverty to pay
funding of last
the full cost of
resort after
services
Medicaid
Began in 1987
Sources: Bureau of Aging and In Home Services Annual Report 2002, Indianapolis Indiana, 2002.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADL — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-31
No. of persons
Annual cost
Functional eligibility
Financial eligibility
enrolled/slots
cap
Target
Determined
Income/resource
Determined
approved in
(aggregate
Administrative
Financial
Program
group
Criteria
by
limits
by
Services
SFY2002
individual)
oversight
oversight
Residential
Persons
Persons who
FSSA County Income must be
FSSA county Pays for
1,411 residents
Not
FSSA
FSSA
Care
aged 65
cannot live
offices
less than the
office
facility
served
applicable.
Assistance
and older
independently
residential care
charges
Program
or younger but who do
facility rate
exceeding
State spending
(RCAP)
persons
not need care
residents’
was $9.6
with
in a nursing
income;
million
State funded
disabilities facility
provides
residents a
Began in 1975
personal
needs
allowance
Sources: Bureau of Aging and In Home Services Annual Report 2002, Indianapolis Indiana, 2002.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADL — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-32
Functional eligibility
Financial eligibility
No. of persons
Annual
Income/
enrolled/
cost cap
Determined
resource Determined
slots approved, (aggregate
Admin.
Financial
Program
Target group
Criteria
by
limits
by
Services
SFY2002
individual) oversight
oversight
Development Persons with
ICF/MR
Office of
300% of
FSSA
Residential habilitation and
3,432
Average
Office of
Office of
al Disabilities mental
level of
Medicaid
SSI
County
support;
served/4,816
monthly
Medicaid
Medicaid
Waiver
retardation/
care
Policy and
income/
Offices
community habilitation and
slots approved
Medicaid
Policy and Policy and
developmental
Planning and
$1,500
participation;
waiver cost, Planning
Planning
Medicaid
disabilities
Bureau of
asset limit
respite care;
$3,677
1915(c)
Developmental for an
adult day services;
SFY2002
waiver
Disabilities
individual
pre-vocational services;
Services
supported employment services;
Initiated in
health care coordination;
2001
family & caregiver training;
(formerly the
physical therapy;
Intermediate
occupational therapy;
Care Facility
speech/language therapy;
for the
recreational therapy;
Mentally
music therapy;
Retarded
psychological therapy;
Waiver,
nutritional counseling; enhanced
which began
dental services;
in 1992)
behavior management/crisis
intervention;
environmental modifications;
specialized medical equipment &
supplies;
personal emergency response
systems;
transportation;
rent & food expenses of an
unrelated live-in caregiver
Sources: Bureau of Aging and In Home Services Annual Report 2001, Indianapolis, IN, 2001 and telephone interviews.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADL — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-33
No. of
Functional eligibility
Financial eligibility
persons
Income/
enrolled/slots
Cost cap
Target
Determined
resource
Determined
approved,
(aggregate
Admin.
Financial
Program
group
Criteria
by
limits
by
Services
SFY2002
individual)
oversight
oversight
Support
Persons
ICF/MR
Office of
300% of
FSSA county
Provides an annual
486 persons
Average
Office of
Office of
Services
with
level of
Medicaid
SSI/$1,500
offices
allowances for services.
served/2,333
cost per
Medicaid
Medicaid Policy
Waiver
develop-
care
Policy and
asset limit
slots approved
month,
Policy and
and Planning
1915 (c)
mental
Planning
for an
Rent & food;community
$1,125
Planning
disabilities
and Bureau
individual
habilitation &
SFY2002
Initiated in
of
participation;
April 2002
Developmen
respite care;
tal
adult day services;
Disabilities
pre-vocational services;
Services
supported employment;
health care coordination;
family and caregiver
training;
physical therapy;
occupational therapy;
speech/language
therapy;
recreational therapy;
music therapy;
psychological therapy;
nutritional counseling;
enhanced dental
services;
behavioral
management/crisis
intervention;
specialized medical
equipment & supplies;
personal emergency
response systems;
transportation
Sources: Olmstead Real Choices Narrative downloaded from [http://www.in.gov/fssa/servicedisabl/olmstead/realnar.html] on Feb. 1, 2002.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADL — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-34
Functional eligibility
Financial eligibility
No. of persons
Income/
enrolled/slots
Cost cap
Target
resource
Determined
approved,
(aggregate
Admin.
Financial
Program
group
Criteria
Determined by
limits
by
Services
SFY2002
individual)
Oversight
oversight
Autism
Persons
ICF/MR
Office of
300% of
FSSA
Personal assistance,
243 persons
Average cost
Office of
Office of
Waiver
with a
level of care
Medicaid
SSI/$1,500 county
residential-based habilitation,
served/400 slots
per month
Medicaid
Medicaid
diagnosis
Policy and
asset limit
offices
respite care,
approved
per
Policy and
Policy and
Medicaid
of autism
Planning and
for an
adult day services,
individual,
Planning
Planning
1915(c)
Bureau of
individual
pre-vocational services,
$2,788
waiver
Developmental
supported employment
SFY2002
Disabilities
services,
Initiated in
Services
family & caregiver training,
1990
adult day habilitation,
physical therapy,
occupational therapy,
speech/language therapy,
behavioral management/crisis
intervention,
applied behavior analysis,
environmental modifications,
assistive technology,
personal emergency response
systems,
supported living services,
transportation
Sources: Bureau of Aging and In Home Services Annual Report 2001, Indianapolis, IN, 2001.
SSI — Supplemental Security Income
FSSA — Family and Social Services Administration
ADL — Activities of Daily Living
MR — Mental Retardation
DD — Developmental Disabilities
IFC — Intermediate Care Facilities

CRS-35
Appendix 2. Large State MR/DD Facilities, 1960-2001, Including
Facility Population, Per Diem Expenditure, and Closures (IN)
Average per
Year
Residents with
diem
Large state MR/DD facilities or
facility
Year
MR/DD on
expenditures
units operating 1960-2001
opened
closed
June 30, 2001
FY2001 ($)
Central State Hospital
1848
1995
—
—
(Indianapolis)
Evansville State Hospital
1890
—
41a
216.14a
(Evansville)
Fort Wayne Developmental
1890
—
324
338.76
Center (Fort Wayne)
Logansport State Hospital
1888
—
46
287.11
(Logansport)
Madison State Hospital (Madison)
1910
—
78
268.10
(Butlerville)
1920
2003
258
380.00
New Castle Ctr. (New Castle)
1907
1998
—
—
Norman Beatty Memorial
1951
1979
—
—
Hospital (Westville)
Northern Indiana Ctr. (South
1961
1998
—
—
Bend)
Richmond State Hospital
1890
—
35
268.00
(Richmond)
Silvercrest State Hospital (New
1974
1995
—
—
Albany)
Source: Residential Services for Persons with Developmental Disabilities: Status and Trends
Through 2001. Research and Training Center on Community Living, Institute on Community
Integration/UCEED, University of Minnesota, June 2002.
a. FY2000 data.

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Appendix 3. About the Census Population Projections
“The projections use the cohort-component method. The cohort-component
method requires separate assumptions for each component of population change:
births, deaths, internal migration (Internal migration refers to State-to-State
migration, domestic migration, or interstate migration), and international migration
... The projection’s starting date is July 1, 1994. The national population total is
consistent with the middle series of the Census Bureau’s national population
projections for the years 1996 to 2025.”
Source: Paul R. Campbell, Population Projections for States by Age, Sex, Race, and Hispanic Origin:
1995 to 2025, 1996, U.S. Bureau of the Census, Population Division, PPL-47. For detailed
explanation of the methodology, see [http://www.census.gov/population/www/projections/ppl47.html].

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Additional Reading
Indiana Family and Social Services Administration, Bureau of Aging and In Home
Services Annual Report 2001, Indianapolis Indiana, 2001.
Indiana Family and Social Services Administration, First Edition; Indiana’s
Comprehensive Plan for Community Integration and Support of Persons with
Disabilities, June 1, 2001 Indianapolis Indiana, June 1, 2001.
Olmstead Real Choices Narrative downloaded from [http://www.in.gov/fssa/
servicedisabl/olmstead/realnar.html] on February 1, 2002.
Reinhard Susan C, and Scala Marisa A, Navigating the Long-Term Care Maze: New
Approaches to Information and Assistance in Three States, AARP, Washington
D.C., 2001.
Indiana Family and Social Services Administration, First Edition; Indiana’s
Comprehensive Plan for Community Integration and Support of Persons with
Disabilities, June 1, 2001 Indianapolis Indiana, June 1, 2001.
University of Minnesota Research and Training Center on Community Living, A
Review of the Medicaid Home and Community-Based Services Program in
Indiana, March 30, 2001 Centers for Medicare & Medicaid Services. Available
from [http://www.hcbs.org].
Tilly Jane and Susan Goldenson, Home and Community-Based Services for Older
People and Younger Adults with Physical Disabilities in Indiana, Final Report,
February 26, 2001, Centers for Medicare & Medicaid Services. Available from
[http://www.hcbs.org].