Indiana

Indiana’s interRAI waiver assessments: what the 2026 denial reports do—and do not—show

Matthew Colley

28 Sep 2026 — 5 min read

A new assessment process is now in use

Indiana replaced the former LOCSI assessment with age-appropriate interRAI instruments for Family Supports (FS) and Community Integration and Habilitation (CIH) waiver determinations of ICF/IID level of care, effective December 31, 2025.

The change matters because meeting this level-of-care standard is part of eligibility for these waivers. If a person is found not to meet ICF/IID level-of-care requirements, waiver eligibility can end, subject to notice and fair-hearing rights.

FSSA has said that the FS and CIH eligibility criteria did not change. At the same time, FSSA transition materials acknowledged that changing the assessment process could result in some people who had previously been eligible no longer meeting level-of-care requirements.

The available evidence shows a reported increase in adverse eligibility outcomes after the rollout. It does not show that interRAI caused every denial, that any particular decision was wrong, or how many people ultimately lost services.

Who is affected by interRAI

The assessment change applies to:

New FS and CIH applicants; and
Existing participants at their annual reassessment.

Existing participants were not scheduled for reassessment all at once in January 2026. Instead, FSSA said they would receive the new assessment at their next annual renewal.

FSSA uses different interRAI instruments for adults, children and youth ages 4 through 17, and children ages 0 through 3. Initial assessments remain with the Bureau of Disabilities Services, while annual reassessments are conducted by case managers, according to FSSA materials.

FSSA has described interRAI as a valid, reliable, and more developmentally appropriate replacement, particularly for children and youth. Commenters raised concerns about eligibility, provider availability, funding, service restrictions, and therapy caps. Those concerns involve different issues and should not be treated as the same as a level-of-care decision.

What has been reported about denials

WTHR reported, based on information provided by the state, that 15,476 people were assessed from January through June 2026. The report said 772 people were denied and another 1,721 cases were under review.

The reported denials included:

562 adults; and
210 children.

WTHR also reported that the previous denial rate was about 1% and that early-2026 rates ranged from 5% to 16%, depending on how pending reviews were handled.

These figures are important evidence of an increase in reported adverse eligibility outcomes after implementation. But they come through secondary reporting based on state-provided information, not a publicly available primary dataset. The 1,721 cases under review are not denials or final adverse decisions.

The public record does not provide a clean before-and-after denial-rate series separately for FS and CIH. It also does not identify the reasons for denials, distinguish new applicants from reassessments, show final outcomes for pending cases, or provide demographic or geographic breakdowns.

For those reasons, the reported figures cannot establish that interRAI itself caused a particular denial. They also cannot establish the number of people who lost services.

What a denial can mean—and what it does not mean

A finding that a person no longer meets ICF/IID level-of-care requirements can end waiver eligibility. But a reported denial does not by itself show whether the person was a new applicant or an existing participant, whether an appeal was filed, whether services continued during an appeal, or what the final outcome was.

Unsuccessful applicants have fair-hearing rights. Timely appeals may allow services to continue while the case is being decided. Publicly available appeal counts, appeal durations, and appeal outcomes were not located.

FSSA’s acknowledgment that the assessment transition could produce adverse results, along with its commitment to track affected active participants, does not establish that the reported decisions were erroneous.

Keep eligibility, service limits, and waiting lists separate

Several issues affecting disability services can be discussed together, but they are not interchangeable.

Level-of-care eligibility concerns whether a person meets the ICF/IID standard used for FS or CIH waiver eligibility.

Service limits and funding issues can involve therapy limits, reimbursement, funding concerns, or other service-policy changes. These are separate from a level-of-care determination.

Waiting-list capacity concerns the number of approved waiver slots and invitation processes. It is not necessarily evidence that someone on the list was denied level-of-care eligibility.

Indiana reported 25,919 actively filled FS slots as of July 15, 2026, and 11,455 people on the FS waiting list as of September 2026. The August 2026 CIH amendment authorized unduplicated participant capacity of 9,438 in year one, increasing to 9,523 in year five.

Those capacity figures should not be read as proof that interRAI created the waiting list or reduced statewide access to waiver services.

The proposed specialized residential facility is a separate issue

Indiana has an active procurement, RFP 26-87928, for a proposed 10-to-20-bed Comprehensive Rehabilitative Management Needs Facility, or CRMNF. Bids were listed as due October 30, 2026.

FSSA’s financial review states that one of Indiana’s two CRMNFs closed in 2024. It says the state pursued an additional facility after issuing a request for information on February 11, 2026.

State materials describe CRMNFs generally as serving up to 20 to 25 people. The intended population is adults with intellectual or developmental disabilities, dual diagnoses, and acute or high-risk behavioral, psychiatric, or medical needs that require intensive, short-term, around-the-clock support.

The 2024 closure and the state-described specialized need support a replacement or capacity-gap explanation for the procurement. The procurement itself is a proposal to obtain an operator; it does not establish that the facility is operating, will necessarily be built, or has admitted anyone.

Most importantly, no located primary evidence establishes that FS or CIH denials, waiver-budget reductions, or interRAI findings will be used to route people into the proposed CRMNF. The available record does not establish a placement pipeline from waiver denials to institutional care.

Questions that remain unanswered

The available record leaves major questions for families, providers, advocates, and policymakers:

What were the FS-specific and CIH-specific approval, denial, withdrawal, and pending-review figures before and after December 31, 2025?
How many adverse decisions involved existing participants versus new applicants?
What were the stated reasons for the decisions?
How many people appealed, how long did appeals take, and what were the outcomes?
Has FSSA completed its tracking of active participants found no longer to meet level-of-care requirements after the transition?
What detailed admission criteria would apply at the proposed CRMNF?
What was the exact capacity and closure date of the CRMNF that closed in 2024?
What legislative oversight, if any, followed the reported denial increase?

Until those questions are answered, the strongest supported conclusion is limited: Indiana changed its FS and CIH assessment process at the end of 2025, and WTHR’s reporting based on state-provided data indicates a reported rise in adverse eligibility outcomes in early 2026. The evidence does not establish the cause of each decision, the final outcomes of pending cases or appeals, or a connection between waiver denials and the proposed specialized residential facility.