MedicaidPrior AuthHigh impact
[Indiana] Prior Authorization and Third-Party Liability - UPDATE
CareSource·IN·Provider Bulletin
Effective date
Jan 2, 2026
We identified it
May 9, 2026
Summary
Indiana Medicaid (IHCP) now requires prior authorization for any service that needs PA from Medicaid, regardless of whether a third-party payer has already paid or authorized the service. The only exception is Medicare Parts A/B or Medicare Replacement Plans. Claims will be denied without IHCP prior authorization, even if the primary payer approved the service.
Action Required
Effective immediately (01/02/2026): Billing team must implement a mandatory dual prior authorization process for all Indiana Medicaid claims when services require PA. REQUIREMENTS: (1) Before submitting ANY claim to IHCP where PA is required, obtain prior authorization from IHCP first, regardless of primary payer approval status. (2) If claim is denied by primary payer with CARC/RARC codes indicating non-covered services or authorization requirement, billing team must request PA from IHCP before resubmission. (3) Update billing system workflow to flag all IHCP claims requiring PA and prevent submission without documented IHCP PA approval. (4) Update provider encounter forms and internal guidelines to clarify that Medicare exception applies ONLY to Medicare Parts A/B and Medicare Replacement Plans—all other third-party payers do not exempt the IHCP PA requirement. (5) Train all billing staff on new dual PA workflow. CONSEQUENCE: Claims submitted to IHCP without required prior authorization will be denied and payment will not be received, even if third-party payer approved and paid. Contact CareSource Health Partner Services at 1-844-607-2831 (M-F, 8a-8p ET/7a-7p CT) for questions.