LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 6908 NOTE PREPARED: Dec 28, 2024
BILL NUMBER: SB 234 BILL AMENDED:
SUBJECT: Medicaid Matters.
FIRST AUTHOR: Sen. Johnson T BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: The bill requires the Office of the Secretary of Family and Social Services (FSSA)
to report specified Medicaid data to the Medicaid Oversight Committee.
The bill requires the FSSA to receive and review data from specified federal and state agencies concerning
Medicaid recipients to determine whether circumstances have changed that affect Medicaid eligibility for
recipients. It prohibits the FSSA from accepting self-attestations of certain information in the administration
of the Medicaid program.
It requires the FSSA to apply for a Medicaid state plan amendment to remove references to coverage under
the Medicaid plan of a certain population.
It requires the FSSA to establish: (1) performance standards for hospitals that make presumptive eligibility
determinations and sets out action for when hospitals do not comply with the standards; and (2) an appeals
procedure for hospitals that dispute the violation determination.
The bill modifies eligibility categories and requirements for the Healthy Indiana Plan (HIP). It specifies
limitations for enrollment in the HIP.
Effective Date: Upon passage; July 1, 2025.
Explanation of State Expenditures: The bill will have significantly increased costs to establish and review
eligibility quarterly (instead of annually) for Medicaid program enrollees. The bill will also increase
eligibility surveillance administrative costs for both FSSA and other state agencies that partner with FSSA
to provide information regarding Medicaid eligibility. Depending on the data sharing arrangement, the
Management Performance Hub will have workload increases to provide support. These costs are
indeterminate and will likely increase workload for the FSSA beyond their existing staffing and resource
levels.
Conversely, if federally approved, provisions of the bill that reduce or limit Medicaid enrollment have the
SB 234 1 potential to significantly reduce expenditures for the state Medicaid program.
Healthy Indiana Plan (HIP): The bill will limit the number of enrollees in the HIP 2.0 program to the amount
sustained by the appropriation or 500,000. The number of beneficiaries may be limited by work or similar
activity requirements, a 36-month benefit limit, and date of activation requirements.
HIP enrollment is forecast to total 707,852 and 711,009 in FY 2026 and FY 2027, respectively. HIP
expenditures are forecast to be $6.4 B and $6.6 B in FY 2026 and FY 2027, respectively. Federal
reimbursement pays about 90% of the HIP costs, while the state share is paid from the Incremental Hospital
Assessment Fee (IHAF) and the state Cigarette Tax (about 9% and 1%, respectively). HIP enrollment is
comprised of the following:
Expansion, including medically frail76%
State Plan* 18%
Pregnant Women 5%
Presumed Eligible <1%
*State Plan members would revert to another
category of Medicaid enrollment.
Explanation of State Revenues: The bill could lower collections from the IHAF by reducing the number
of people covered by HIP.
Explanation of Local Expenditures: Locally owned hospitals may have lower payments for the IHAF.
Explanation of Local Revenues: Revenue for locally owned hospitals from presumed eligible patients and
reductions in the number of patients covered by HIP may reduce patient revenue and increase bad debt or
charity care.
State Agencies Affected: Family and Social Services Administration; Management Performance Hub.
Local Agencies Affected: Locally owned hospitals.
Information Sources: December 2024 Medicaid Forecast.
Fiscal Analyst: Karen Rossen, 317-234-2106.
SB 234 2