FORT WAYNE, Ind. - (KRT) - Twelve-year-old Dale Harless knew life was looking up when his foster mother decided to adopt him. The Memorial Park middle- schooler, who is autistic with other developmental disabilities, has lived with Terry Harless for more than a year.

She knew that by adopting him, Allen County would no longer pay his considerable medical bills and other expenses. But Dale's wide smile and the love he showed her outweighed financial concerns.

Good news arrived when Harless - and thousands of others in the state - were encouraged to apply for a new Medicaid waiver program in April 2002. Since then, the good news has been toned down because of snafus and a shortage of cash.

Waivers enable people with disabilities to receive Medicaid-paid therapies, case management, transportation, respite care and daily living skills training while remaining at home or in a community setting.

Dale was already waiting for another, more comprehensive autism waiver, but it would be years. A total of 2,145 people are vying for only 111 openings next year.

Although the new waiver offered only a fraction of the help, "anything we could get, we welcomed," Harless said.

Thousands of families like the Harlesses signed up and were told their loved ones had a slot. In most cases, the waiver also meant clients could begin to receive additional services paid by Medicaid.

The state also moved some adults who had been on another program that was 100 percent state-funded to the new waiver.

"That was the goal, to move as many people off the Title XX program as possible," so fewer state dollars were used, said Steve Cook, director of the Division of Developmental Disability Services within the Indiana Family and Social Services Administration. FSSA oversees all Medicaid programs.

But for hundreds of people like Dale who were promised help, it never came. Some parents and caregivers laid out money for purchases such as $300 orthopedic shoes, even surgeries, with the understanding those expenses would be paid for by Medicaid. But, Cook said, because it was the state's error, it will cover the tab.

Harless was left in limbo for a year. She never received a denial notice, but "(Dale's) slot number just disappeared. My case manager said, `I'm so sorry. I don't know what to tell you. They won't tell us anything.' "

Robert Fechtman, an Indianapolis attorney who is filing an appeal for 27 families whose waivers were rescinded, said, "An apology isn't enough."

"You can't legally tell a family they have a benefit and based on nothing but your mistake, tell them they don't have the benefit after all," Fechtman said.

Cook said at least 1,000 people from across the state have filed appeals.

"This certainly has been problematic," said Cook, who blamed budget shortfalls, human error and computer problems.

Officials approved 2,333 waivers the first year, another 2,167 the second year, and another 2,500 the third year, a total of 7,000.

But 3,500 were given out in the first nine or 10 months, more than 1,000 than were supposed to be. He said his predecessor, who is no longer with the state, sent out too many approval letters. Cook also said the legislature failed to budget enough money to match federal dollars. He also blames "a computer mix-up."

Budgetwise, he said, "We didn't get any new funding, so the funding was coming about by moving individuals from the 100 percent state funded Title XX program to the waiver." But there were 4,000 people on Title XX.

"Information about individuals who applied for the waiver was not consistently entered into the state's central database," said the state's letter of apology, sent in late June.

Cook also said the number of children whose parents applied for the waiver on their behalf caught the state off guard.

"We weren't prepared for the number of kids. A lot of autism and DD (developmentally disabled) are adults. There seemed to be a lot of kids who applied for the Support Services waiver who weren't on any other (waiver) list," Cook said.

But that reasoning doesn't cut it with Fechtman or Harless.

"Just look at the number of kids here who are served by (Easter Seals) Arc," Harless said. "It's about 2,000. Multiply that across the state. Somebody just wasn't thinking. I think it was poor planning, and they didn't have the money."

In the end, a program instituted to help thousands of disabled on a waiting list of 2,000 has a waiting list of its own. And the list is 6,800 strong.

About 1,500 people on the Title XX program were moved to the new waiver, Cook said. Additionally, "The good news is there are about 800 new people who are receiving services now who weren't before."

But for the families of many of the 6,800 names on the waiting list, "I think it will be years," said Fechtman.

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© 2003, The News-Sentinel (Fort Wayne, Ind.).