The Generation Project






The Implementation of SEA 493:
A Policy Education Series from The Generations Project


A Tool for All Citizens
September 2006


Since its founding in 1986, the Indiana Home Care Task Force has coordinated the public policy efforts to build a consumer driven system of quality and affordable home and community based services (HCBS) in the state. Those efforts resulted in the passage of the Community and Home Options to Institutional Care for the Elderly and Disabled Act (CHOICE) in 1987, Senate Enrolled Act 493 in 2003, and many more HCBS laws in between.

What follows is a briefing from the Task Force that can be used as a tool for any and all citizens to advance cogent arguments regarding the importance of implementing SEA 493 and maintaining the CHOICE home care program. SEA 493 and CHOICE will remain in 2006 and beyond the lynchpins and hope for the type of home and community based services that Hoosiers want and need. Consequently, readers of the Task Force paper will find the history, program information, policy discussion, principles, and action steps they need to effectively talk to the public officials and fellow citizens about the importance of SEA 493 and CHOICE.


SEA 493 Implementation and Related Issues
An Advocacy Education Paper from the Indiana Home Care Task Force


The implementation of Senate Enrolled Act 493, commonly called SEA 493, is the primary concern of the Indiana Home Care Talk Force. Its member organizations believe there is no greater priority today in Indiana regarding programs and services for senior citizens and persons with disabilities. Citizens and organizations are encouraged to use the following briefing paper to enhance their abilities to effectively communicate with other Hoosiers, public officials and lawmakers regarding the importance of SEA 493 and CHOICE.


In 1987 the General Assembly passed by a vote of 149-1 the Community and Home Options to Institutional Care for the Elderly and Disabled Act, or CHOICE. CHOICE remains the most popular and visible form of quality and consumer driven home care services today for seniors and persons with disabilities. CHOICE is administered locally by the 16 Area Agencies on Aging with all services delivered by private providers. CHOICE remains very cost effective and customer friendly.

Since CHOICE only uses state tax dollars, its funding base has proven to be finite. Additionally, while CHOICE is a very flexible program it is not a substitute for programs that specifically provide for assisted living, adult foster (or family) care, and adult day care.

Beginning in 1991, Indiana began to employ a series of Medicaid waivers for home and community based services (HCBS) that are similar to CHOICE in order to bring federal dollars for those services. However, the combination of CHOICE and the waivers did not create a comprehensive, integrated and balanced long-term care system. That happened with the unanimous passage of SEA 493 in the 2003 General Assembly.

General Features

SEA 493 is comprehensive because the law establishes a long-term care (LTC) system that requires individuals to have the choice of any form of LTC they need including any form of HCBS. The implementation of SEA 493 must maintain that feature of the law.

SEA 493 is integrated because it establishes a global budget for all long-term care and allows dollars to follow individuals receiving Medicaid nursing home services to Medicaid HCBS if they choose the latter.

SEA 493 is balanced because it equalizes income eligibility between Medicaid nursing home care and HCBS waivers by raising the latter to 300 percent of the federal Supplemental Security Income level, or $1,810 per month for individuals.

Key Concerns

The implementation of SEA 493 and the ongoing administration of CHOICE must be in accordance with the consumer driven features of those laws.

SEA 493 and CHOICE encourage and are compatible with the optimal use of federal Medicaid waivers, Medicaid, Medicare and other federally funded HCBS. Neither should be denigrated by the state in the process of trying to optimize the use of federal dollars. (As used in this briefing paper, “state” refers to the Indiana Division of Aging and its supervisory agency, the Indiana Family and Social Services Administration.)

SEA 493 and CHOICE are based on consumer-driven market place solutions. These laws are specifically designed to use neutral case management services and advocacy for consumers provided in local communities through the Area Agencies on Aging in order to make market place choices viable. This structure is commonly called the “single point of entry system” and is a nationally recognized model. That system protects consumers, and brokers the best and most effective services from private providers. Those local market mechanisms should stay in place.

As a whole the AAAs operate case management services, nutrition programs, and federally mandated advocacy services that result in best health and outcomes for seniors and persons with disabilities. Nonetheless, the AAAs have indicated their willingness to work in partnership with consumer groups and the state to improve what they do. Recent threats and actions by the state to cut AAA budgets, to alter Medicaid waiver and CHOICE provider rates, to threaten AAA nutrition programs, and to take away their senior employment programs only make it harder for the AAAs to do their work. Such actions by the state will make it difficult to implement SEA 493 in a humane and cost effective manner.

Core Principles

·         Rates set by the state for HCBS services must be adequate to ensure participation of quality providers, and to generate local competition between providers wherever possible.

·         The AAAs must be sustained through adequate staff and funding, and should continue to serve as the independent, single point of entry, one-stop resource for consumers in need of long-term care.

·         The AAAs should continue to be locally controlled and accountable within the context of existing state and federal laws. Contracts with the state should reflect those parameters. New performance standards for the AAAs must be mutually agreed upon by the state, the AAAs, and consumer representatives.

·         The CHOICE program must be funded at a level to insure sufficient services for those waiver-eligible consumers who have not yet transitioned onto an HCBS waiver, and to insure sufficient services to all CHOICE eligible consumers who do not quality for the waiver.

·         The state should work with the Area Agencies on Aging to calculate the number of persons who should be receiving Medicaid waiver services under the provisions of SEA 493 including persons currently being served by CHOICE, persons in other long-term care settings, and persons on waiting lists. These calculations should include estimates of the number who can be served on the waivers in the current fiscal year, estimates of the persons to be served in the next biennium in all long-term care venues, and calculations regarding funding and appropriate funding sources.

·         All consumers entering the long-term care system or changing services within that system should receive independent counseling about all the available options from a professional AAA case manager, and have freedom of choice among all options for which they are eligible as defined by SEA 493 and CHOICE.

·         Consumers may not be forced to move or relocate against their will as the result of a “bed buy-out” in any nursing facility and these transactions must be transparent. (The state has offered to literally pay nursing homes $10,000 or more per bed to close Medicaid certified nursing facility resident beds in order to take them off the market. Since bed buy-outs are done with public funds the transactions should be entirely open to public review.)

·         The array of services within Indiana’s long-term care system must include a true diversity of facility and community based options, with an emphasis on non-institutional providers of long-term care services per the directives contained in SEA 493.

·         The state must maintain in its administrative code a standard for adult family/foster care providers of a maximum of three individuals in each home-like setting.

Legislative Action

To act on the concerns raised in this memorandum state officials and legislators have three options:

1.      Utilizing public hearings by standing legislative commissions or committees, or by committees during the 2997 session, to hear public concerns and to secure commitments from the state to address the concerns that are raised in this paper.

2.      Pass legislation to address the concerns listed in this paper.

3.      Pass funding in the state budget act to address the funding needed for HCBS under SEA 493 and CHOICE, and to address the administrative and case management needs of the Area Agencies on Aging.

The Indiana Home Care Task Force stands ready to work with the state and the members of the General Assembly to draft solutions to the concerns raised in this paper. Citizens who share these concerns are also urged to communicate with state officials and their elected representatives.