11/25 Torchbearer Weekly Policy Update

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Indiana's Revenue Shortfall
Challenges in PathWays Program
Braun's Executive Branch Overhaul
Court Strikes Down 2024 Salary Rule
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Indiana's Revenue Shortfall

Headline: A two-year task force on Wednesday released broad suggestions for property and income tax changes, but left the specifics to business tax recommendations.

Dig deepr: Lawmakers created the State and Local Tax Review (SALTR) Task Force last year in hopes of ditching the state’s individual income tax. That’s now off the table.

What they’re saying: “In 35 or 40 years, perhaps, but not in the foreseeable future,” quipped Sen. Travis Holdman, the group’s co-leader, in remarks to reporters.

Holdman heads the Senate’s tax-focused committee during legislative sessions and authored the legislation creating the task force.

Yes, but: Democrats assailed the recommendations as not providing enough relief to Hoosier taxpayers, and for giving “handouts” to businesses.

The final report was approved in a 9-1 vote, with two absences. It was edited slightly from the draft - by adding more specific language to the first recommendation during the meeting. Sen. Fady Qaddoura, D-Indianapolis, suggested affixing “particularly for homesteads” to the end. It was approved by consent.

What’s next?: Remains to be seen … (Indiana Capital Chronicle)

Challenges in PathWays Program

The PathWays Medicaid program for Indiana seniors continues to face significant hurdles, as highlighted in a recent two-hour meeting of the Medicaid Advisory Committee.

Why it matters: Seniors and care providers are grappling with access issues and confusion within the PathWays program, which impacts the effectiveness of managed care for thousands of Hoosiers.

Communication gaps:

Seniors struggle to identify their care coordinators and understand benefits, often encountering redirection and insufficient information when contacting PathWays support services.
A significant portion of enrollees, 80%, also qualify for Medicare, leading to potential mismanagement of benefits between the two programs.
State-contracted support through Maximus is meant to assist, but seniors still report high levels of confusion and lack of clarity.

Provider payment delays:

Providers such as nursing homes and adult day centers experience reimbursement delays, with insurers like Anthem failing to meet timely payment benchmarks.
Anthem has incurred additional costs due to interest on late payments, highlighting ongoing processing challenges.

Waitlist concerns:

The introduction of a waitlist for waiver services under PathWays and Health and Wellness is causing concern, with nearly 9,000 seniors awaiting additional services.
Legal challenges loom, as a class action lawsuit argues that these prolonged wait times violate federal law.

Looking forward:

Indiana lawmakers and the Family and Social Services Administration face pressure to resolve these issues, improve communication, and streamline payment processes to better serve the state's aging population. (Indiana Capital Chronicle)

Braun's Executive Branch Overhaul

Governor-elect Mike Braun has announced a sweeping reorganization of Indiana's executive branch, introducing a new cabinet model to enhance the state government's efficiency, accountability, and communication.

Why it matters: This restructuring is a significant shift in how Indiana's state government operates, aiming to streamline processes, improve inter-agency coordination, and ensure leadership accountability. The changes aim to enhance service delivery to Hoosiers and align state operations with the administration's "Freedom and Opportunity" agenda.

Key components of the new cabinet model:

Leadership Structure: The cabinet will include the Governor, Chief of Staff, Lieutenant Governor, superintendent of state police, adjutant general of the Indiana National Guard, and secretaries overseeing eight policy areas such as Commerce, Health and Family Services, and Education.
Cabinet Secretaries' Roles: Each secretary will oversee their respective policy area while also leading their agency, ensuring vertical integration and efficiency across state government.
Operational Focus: The cabinet is tasked with collaboratively implementing cross-government initiatives, supported by a lean, agile senior management team within the Governor's office.

Roles and Responsibilities:

Secretary of Management and Budget: This role is pivotal, involving budget development, management of finance and technology, and operational oversight across secretary verticals.
Secretary of Commerce: Focuses on driving economic opportunities for the state and its residents.
Secretary of Health and Family Services: Aims to improve coordination across health services, addressing public health policy holistically.
Secretary of Public Safety: Ensures the safety and security of residents through oversight of law enforcement and emergency preparedness.

Looking forward: The restructured cabinet model is designed to implement cross-government initiatives effectively. It emphasizes frequent cabinet meetings to coordinate efforts, address challenges, and ensure alignment with the administration's priorities. Governor-elect Braun's vision includes further integration informed by analytical efforts and stakeholder inputs, with a focus on delivering tangible results for Hoosiers.

Court Strikes Down 2024 Salary Rule

Employers can breathe a sigh of relief after a Texas federal court struck down the Department of Labor's 2024 Rule, which had significantly increased the minimum salary for "white collar" exemptions under the Fair Labor Standards Act (FLSA).

Why it matters: This decision has major implications for employers across the U.S., especially those concerned about rising labor costs. The ruling affects executive, administrative, and professional (EAP) exemptions, crucial for determining overtime eligibility and compensation structure.

Key details of the ruling:

Salary Thresholds: The 2024 Rule raised the threshold from $684 to $844 weekly, with a planned increase to $1,128 in January 2025. This would have impacted millions of employees.
Court's Findings: The judge ruled that the DOL overstepped by allowing salary to overshadow duties in determining EAP exemptions, calling it administrative overreach.
Automatic Increases: The court also nullified the rule's provision for automatic salary hikes every three years starting 2027, lacking a basis in duty-related changes.

Legal and financial implications:

Reversion to Previous Standards: The salary threshold reverts to $684/week, reinstating the status quo prior to the 2024 Rule.
Potential Appeals: While the DOL could appeal to the Fifth Circuit, changes in leadership and priorities with the new administration make this uncertain.

Looking forward: Employers should remain vigilant as the DOL re-evaluates its approach. Future regulations will likely aim to balance duties-based criteria with fair compensation practices, maintaining a focus on both employer flexibility and worker protections. Stakeholders should prepare for ongoing discussions and potential future changes in labor standards and compensation policies.