Can you explain how it isn't working? I just tested and adding something like this worked perfectly fine:
\io1 First section \xt MAT 1:1\xt*
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Not directly answering your question, but you talk about a topical index and then talk about markers (\io#) typically used for introductory outlines. It's maybe possible that if you're mixing introductory markers (ones starting with \i) along with markers used in regular text (like \p or the like), that that's the problem.
See here for an example of how topical indexes might be laid, out, using \k markers (the same keyword marker used in glossaries).
https://docs.usfm.bible/usfm/3.1/periph/book-tdx.html