Gov. Mike Braun orders cross-agency group to tackle soaring costs of autism therapy

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19-02-2025

In response to soaring costs in a Medicaid-covered therapy service for kids with autism ― a program that was recently the subject of a federal audit ― Gov. Mike Braun is ordering a cross-agency working group to figure out how to get the program under control.
His executive order comes just days after his administration abandoned a cost-cutting measure drafted at the tail end of the last administration that would have kicked a number of kids off Medicaid-reimbursed Applied Behavior Analysis, known as ABA, come April 1.
"I'm committed to protecting this program for the families that need it," Braun said Wednesday. "But in the future, we got to run it efficiently and make sure that we marshal the resources to keep it sustainable."
More: Federal audit finds $56 million in 'improper' Indiana Medicaid payments for autism services
The working group established by this executive order would consist of experts from the Family and Social Services Administration, the Department of Education and the Department of Child Services, as well as lawmakers and families.
The group will come up with recommendations for ideal clinical care models, better care coordination, transitioning kids from ABA therapy settings to other settings, caps on hours or the number of months a child can receive the service, appeals processes and new billing requirements to address the issues found in the federal audit. The experts will give a report to the governor by Nov. 30.
FSSA has been making changes to the program since 2023 in an attempt to rein in costs.
The state Medicaid office started covering ABA therapy in 2016 by reimbursing providers based on a percentage of whatever each individual provider billed. The first full year, the program cost the state $14 million. In 2019, it grew to $120 million; then $420 million 2022, and an anticipated $645 million in 2026.
That's partly because the number of kids receiving therapy has increased, but so has the cost per child.
In the fall of 2023, the agency implemented a standardized, flat reimbursement rate for these services, rather than the widely varied hourly rates that providers would charge. Providers largely agreed that the rate needed to be standardized to prevent abuses in the system, but feared the rate the state chose would force some of them to lay off staff or close.
More: 'Rippling effect': Autism therapy providers fear drastically lower proposed Medicaid rates
More than 40 state lawmakers signed a letter asking then Gov. Eric Holcomb to intervene after the first low rate FSSA proposed. The agency then landed on a compromise, and the new rate took effect at the start of 2024.
Then in December, at the tail end of Holcomb's tenure, FSSA proposed an amendment to the state Medicaid plan that would have capped Medicaid coverage of ABA therapy at 30 hours per week for a maximum of three years per child. This would have applied retroactively to children already undergoing therapy, meaning kids who happened to have started therapy three years ago would have been booted off on April 1.
Within days of proposing that amendment, the Health & Human Services Office of the Inspector General published an audit of Indiana's ABA claims in 2019 and 2020, finding at least $56 million in "improper" payments. That's more than a third of the audited payments in those two years. An FSSA spokesperson at the time said this audit "underscored" the need for their state plan amendment.
But after meeting with stakeholders and legislators, the Braun administration changed the proposed amendment. Pending federal approval, FSSA will implement a tiered system, where the limit on hours depends on the severity of the child's autism diagnosis and lends some deference to the provider's judgment. And crucially to advocates, the rule will no longer be applied retroactively.
Republican Rep. Robb Greene, who has a child who underwent ABA therapy, credited Braun and his FSSA secretary Mitch Roob with making this change based on his feedback.
'This goes beyond policy and politics for me, and I want the Governor to know that I'm grateful to him as a dad," Greene said in a statement. "This is a great first step, and I am excited to continue the work we are doing.'
Speaking to reporters Wednesday, Roob said discovering the true implications of the April 1 cutoff for certain kids was "not on my bingo card."
"And there was no plan to deal with these children," he said. "There was no connection to the school. There was no connection anywhere else. And I think that's why you saw the understandable outrage on the part of the parents. And so as soon as we found that out, we knew we had to change that."
The Arc of Indiana CEO Kim Dodson called the changes a "major victory," though the organization still wants to see the three-year limit removed.
"We thank the families and advocates who took the time and effort to educate their legislators and the governor on the importance of ABA therapy," she said. "Their efforts truly made a difference."
Roob said the administration plans to work on another state plan amendment, and may consider adjusting the three-year cap. He said the administration doesn't have a particular enrollment number in mind.
"We want to make sure that we are providing care in a holistic manner, hopefully preventative care, to those who are eligible for it and not to those who are not eligible," he said.
Contact IndyStar state government and politics reporter Kayla Dwyer at [e-mail] or follow her on X: @kayla_dwyer17.
This article originally appeared on Indianapolis Star: Gov. Braun orders agencies to get autism therapy costs under control