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Governor Holcomb Signs Long-Term Care Reforms into Law

Posted May 4, 20235 min Read


INDIANAPOLIS — May 4, 2023: Governor Eric Holcomb signed House Enrolled Act (HEA) 1461 into law this week, which addresses numerous workforce challenges and regulatory issues in the long-term care (LTC) sector.  

Authored by State Representative Brad Barrett (R-Richmond) and sponsored by State Senator Liz Brown (R-Fort Wayne), HEA 1461 reduces licensure requirements for administrators of nursing homes and assisted living communities, prohibits predatory business practices by temporary healthcare staffing agencies, allows Medicaid beneficiaries to more easily receive care at the location nearest to them or of their choosing, and requires the state to improve Medicaid eligibility determinations and develop a plan to improve rural access to care.  

“This is an incredibly important piece of legislation that will strengthen health care providers ability to hire more practitioners and continue to provide the highest level of care to residents,” said Paul Peaper, president of the Indiana Health Care Association/Indiana Center for Assisted Living (IHCA/INCAL). “The LTC sector has disproportionately lost more workers than any other health care sector during the pandemic, or approximately 10,000 practitioners in our state. We greatly appreciate the Governor and the General Assembly’s support this session in giving us more tools to rebuild the health care workforce and support our mission of providing the highest quality care for the most vulnerable and elderly Hoosiers in our communities.”   

Indiana currently has the most onerous licensure requirements in the country for administrators of licensed assisted living communities with many states not requiring a license at all. Future applicants’ relevant work experience and/or educational attainment will count toward their overall training hours, greatly reducing the potential time from application to licensure.  Additionally, the bill created reciprocity for those individuals holding a license from the National Association of Long Term Care Administrators.  

“LTC facilities continue to be affected by staffing shortages, which negatively impacts patients and their quality of care,” said Barrett. “This legislation will help alleviate some of those workforce challenges by easing and streamlining licensing requirements for health facility administrators and practitioners. We also took steps to improve the assisted living reimbursement formula, provide protections to residents of assisted living facilities, support efforts to get elderly Hoosiers into care quicker and bolster the services provided in home-based care. I’m thankful for all of the input from stakeholders and constituents along the way, and I believe this bill will make a difference for patients and care providers alike.” 

Indiana also joined approximately a dozen states that have enacted reforms in the past two years to address price gouging and predatory practices by temporary staffing agencies. The new law gives oversight to the Department of Health and the Attorney General’s Office to take administrative action and levy fines against the licenses of temporary staffing agencies in the health care industry for predatory practices.  

Federal and state appropriations through the Medicare and Medicaid programs account for an average of 85 percent of the reimbursable costs in LTC. Given the system is largely publicly funded, the legislators were vocally concerned during the session about Medicaid reimbursed temporary agency costs hitting at an all-time high of $108 million last year, which was a 121% increase in comparison to 2019.  

HEA 1461 further requires temporary health care services agencies to comply with state and federal regulations applicable to employees at health care facilities, including background checks, testing requirements and proper credentialling. The new law also prohibits contract buy-out provisions and noncompete clauses, as well as liquidated damages, employment fees or other compensation in contracts if a direct care worker is hired as a permanent employee of a healthcare facility.  

Finally, HEA 1461 contains two reporting requirements which directs state government agencies to publish a plan for improving Medicaid eligibility determinations for home and community-based services with the goal of these determinations being made within 72-hours and to develop a plan for improving access to assisted living facilities in rural Indiana. 

Most of the provisions in the new law will be effective on July 1 of this year. To read more about HEA 1461, visit this link.  




IHCA/INCAL is the state’s largest trade association and advocacy group representing for-profit and not-for-profit nursing homes, as well as assisted living communities and independent living. The association provides education, information, and advocacy for health care providers, consumers, and the workforce on behalf of its more than 480+ member facilities. 

About the Author

Deeksha Kapoor, Director of Communications