LINCOLN, NE – Today, Governor Jim Pillen, state senators, and the Nebraska Hospital Association (NHA) held a ceremonial bill signing at Methodist Fremont Health to celebrate a new law that will qualify the state’s hospitals for approximately $1 billion of additional federal Medicaid funds each year.
“Our state’s hospitals provide outstanding health care to Nebraskans,” said Gov. Pillen. “I’m grateful to our state senators for passing legislation to maximize the federal resources available to our hospitals. These much-needed funds will strengthen the quality and accessibility of health care statewide.”
Senator Mike Jacobson of North Platte proposed the new legislation (LB 1087), and Senator Christy Armendariz of Omaha prioritized the bill. Senators voted to pass the bill 45-0. Governor Pillen signed LB 1087 into law on March 27.
“LB1087 is one of the most impactful and transformative pieces of legislation that we passed this session,” said Sen. Jacobson. “This program allows our state to dramatically increase reimbursement rates to hospitals without costing our state general fund any additional dollars. It will have a dramatic impact on reimbursement rates, hospital services, and ultimately on the availability of health care across the state.”
With the passage of LB 1087, Nebraska is implementing a funding mechanism to tap into additional federal dollars. Nebraska’s hospitals will pay an assessment to the Nebraska Department of Health and Human Services (DHHS) of up to six percent of net patient revenues. DHHS will then use money from the assessments as matching dollars to qualify the state’s hospital systems for more federal Medicaid funding.
It is estimated that this legislation will provide for nearly $1 billion annually in additional net federal funding to hospitals.
“LB1087 will have a positive and significant impact on our hospitals’ finances and will make it possible to continue to provide needed services to Nebraska’s Medicaid population,” remarked NHA President Jeremy Nordquist. “We’re so very appreciative of the Governor’s support as well as the many state senators who sponsored and advocated for this important legislation.”
“We are expecting this legislation to have a positive impact on Lexington Regional Health Center” said interim CEO Wade Eschenbrenner. He expects it may have a larger impact on LRHC than other critical access hospitals “because the hospital’s Medicaid utilization will likely impact the net amount a facility may receive”. Eschenbrenner expressed his appreciation to “all the state senators, and the governor for passing this bill to strengthen all hospitals in Nebraska.”
Cozad Community Hospital CEO Robert Dyer says “rural hospitals provide essential care to their communities. A high percentage of Medicaid patients utilize their services, and those facilities are being stretched beyond their limits when the cost of providing quality care is far greater than the reimbursement.” Dyer described the passing of LB1087 as crucial to the survival of many rural Nebraska Hospitals. He thanked “Senator Ibach, her colleagues in the legislature and Governor Pillen for supporting the viability of health care in rural Nebraska.”
Additionally, the bill includes $50 million per year for scholarships to support the development of Nebraska’s nursing workforce. The scholarships will be funded through private investments.
“This is a real game-changer for Nebraska and Nebraska hospitals, especially those serving rural communities and a high percentage of Medicaid patients,” commented Brett Richmond, President & CEO of Methodist Fremont Health.
Since LB 1087 was passed with an emergency clause, it has already taken effect as law.
