Indiana Fixed ABA Medicaid Billing, Now Access Is at Risk

Governor Braun’s Executive Order 25-31 set in motion the lifetime cap, rate cuts, and provider freeze now reshaping ABA access in Indiana.

How the Payment Model Broke

INDIANAPOLIS – For eight years, Indiana Medicaid paid for applied behavior analysis under a formula that reimbursed providers 40 percent of their billed charges. The model, known inside the program as BILL40, set no fixed rates. Hourly reimbursement averaged about $91 but ran anywhere from $46 to $222, according to provider accounts and reporting by the Indiana Capital Chronicle. Paying a share of the invoice made a higher invoice pay more.

The spending followed the incentive. ABA coverage started in 2016 at roughly $21 million a year and climbed to a peak of $611 million in 2023. One case became the emblem. A Wall Street Journal investigation reportedly found that 9 of the 10 highest-billing U.S. autism providers by per-patient spending in 2023 operated in Indiana. Piece by Piece Autism Centers collected $29 million in 2023 to treat 84 patients, about $340,000 per child, and billed rates as high as $640 an hour.

The pressure to act was already there. In December 2023, the state disclosed that its Medicaid forecast had missed by roughly $1 billion, a gap that triggered an emergency across the program. ABA, the fastest-growing line item, drew the closest scrutiny.

What the State Changed

The first fix landed January 1, 2024. Indiana replaced BILL40 with a fixed fee schedule, set out in provider bulletin BT2023169, that pays defined maximums per 15-minute unit by staff credential. After providers pushed back on an initial proposal of $55.19, the state set the rate for care delivered by an RBT (registered behavior technician) at $68.24 an hour, still about 25 percent below the prior statewide average. Spending fell in 2024 to an estimated $474 million, according to then-Medicaid director Cora Steinmetz.

The overhaul continued under Governor Mike Braun after he took office in January 2025. An ABA working group, established by Braun’s Executive Order 25-31 in February 2025, returned about 20 recommendations in November 2025: a lifetime cap on hours, tighter medical-necessity rules, accreditation, and a freeze on new providers.

The bulk of it took effect April 1, 2026, under bulletin BT202627. The rule caps comprehensive ABA at 4,000 hours per child over a lifetime, after which coverage drops to 15 hours a week of targeted therapy unless the state approves more as medically necessary. It cut maximum fees for non-group services by 6 percent, with an additional 4 percent cut across all ABA codes scheduled for April 1, 2027. It ties ABA to EPSDT (Early and Periodic Screening, Diagnostic, and Treatment, the Medicaid benefit for enrollees under 21) and ends coverage for adults 21 and older as of October 1, 2026. It requires up to 18 hours of caregiver coaching per authorization, one hour of BCBA supervision for every eight hours of technician care, and in-person delivery for the core assessment and treatment codes.

The rates on paper: Under BT202627, the technician treatment code CPT 97153 falls from $17.06 per unit to $16.04 in 2026 and $15.39 in 2027. The BCBA-level code 97155 drops from $27.63 to $25.97, then $24.93. Indiana also paused new ABA provider enrollment and layered on an accreditation requirement, with applications due by August 1, 2026, and full accreditation by October 1, 2027, through either the Autism Commission on Quality or the Behavioral Health Center of Excellence. Providers were reportedly told to self-report any fraud, waste, or abuse in early April 2026.

The Access Question

Thousands of Hoosiers rely on Medicaid for ABA, most of them between the ages of 3 and 8. FSSA leadership has said more than 6,000 Hoosiers were accessing ABA through Medicaid as of January 2026, according to local reporting; earlier Indiana Capital Chronicle reporting had put the figure above 8,000. The supply that grew to serve them grew fast: enrolled individual ABA therapists rose from 797 in 2020 to 2,534 by the end of 2024. That expansion is now reversing, making access less certain.

Industry accounts report that smaller operators have been closing or consolidating since the 2024 rate took hold. The economics are tight at the staff level, where the technician rate reaches $15.39 a unit in 2027 while the required one-to-eight supervision ratio, more than double the certifying board’s baseline, adds costs that the rate does not cover.

Demand is not the problem. Representative Becky Cash, a Zionsville Republican, has pointed to long waits for children trying to start ABA. Kim Dodson, chief executive of The Arc of Indiana, notes the state already has close to 20,000 people waiting for home- and community-based services and warns that the crackdown could reach families who genuinely need care.

The sharpest uncertainty sits inside the 4,000-hour cap. Care beyond the ceiling depends on a medical-necessity standard the state has not yet defined, and the Council of Autism Service Providers, a national trade group, has warned that an undefined exception can function as a hard limit. Indiana also treats 16 hours a week as comprehensive care, below the roughly 30 to 40 hours the industry’s clinical guidelines describe. The ban on telehealth billing for core codes hits rural families hardest, since they relied on remote sessions to reach a provider at all, further narrowing access.

The 4,000-hour ceiling comes with an exception for medical necessity, a term the state has not yet defined. Until it does, providers cannot tell families whether the cap is a limit or a wall.

A National Pattern

Indiana is early, not alone. North Carolina moved to cut ABA rates, then canceled the reduction in December 2025 after families sued. Nebraska imposed steep cuts. Georgia providers braced for a 20 percent cut from a managed care plan in April 2026. The through-line is the same: spending climbed for a decade, audits found weak documentation, and states reached for rate and utilization controls.

Indiana’s next moves are already on the calendar. The second rate cut, an additional 4 percent across all ABA codes, takes effect April 1, 2027. Coverage for adults 21 and older ends October 1, 2026. The medical-necessity standard that determines whether a child can receive care beyond 4,000 hours has not been published.

AT A GLANCE

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