Appropriations Committee
March 11, 2025
Committee Chair: Sen. Rob Clements | Bills Heard: 5 | Full Transcript (PDF)
LB146: Increase Medicaid reimbursement rates for dental services
Introduced by: Sen. Ibach | Testimony: 5 proponents, 0 opponents, 0 neutral | Read bill text (PDF)
Nebraska dentists seek second 12.5% Medicaid rate increase after first boost yielded measurable results. The Nebraska Dental Association returned to the Appropriations Committee seeking another $7.8 million increase in Medicaid reimbursement rates, building on a previous 12.5% hike that demonstrably expanded access to care. Why it matters: The first rate increase in July 2024 brought 90 new dentists into the Medicaid program and reduced emergency room dental visits by 500 in six months—saving the state over $1 million annually. With 33% of Nebraska children on Medicaid experiencing tooth decay, preventive care access directly impacts school attendance, health outcomes, and long-term costs. What they're saying: Jessica Meeske, Nebraska Dental Association president, presented data showing 10,000 new child exams and nearly 6,000 new adult exams after the first increase. "We've moved the needle a great deal in six months," she told the committee. Heidi Stark, a pediatric dentist, noted her practice saw 268 children requiring hospital dental surgery in 2024—cases that could have been prevented with early access. "Preventative care for those same 213 kids to visit us twice last year would have only cost the state approximately $64,000," versus $1.7 million in hospital costs. By the numbers: 90 new dentists enrolled; 10,000 new child exams; 6,000 new adult exams; 500 fewer ED visits; $519,000 in six-month savings; $1 million+ annualized savings. What's next: No vote was taken. The bill received 48 online proponent comments and 1 opponent comment.
Committee sentiment: Supportive: Sen. Cavanaugh
Sentiment estimated from questions and comments — not stated positions.
LB54: Increase direct support provider wages for developmental disability services
Introduced by: Sen. Myron Dorn | Testimony: 5 proponents, 0 opponents, 0 neutral | Read bill text (PDF)
Nebraska's direct support providers—the backbone of disability services—earn 67% of living wage as state faces nation's highest turnover rate. An economic study commissioned by the state found that direct support professionals caring for individuals with intellectual and developmental disabilities earn an average of $22,000 annually, well below Nebraska's $30,000 living wage. LB54 seeks an 11% wage increase costing $25.3 million in state funds while drawing down $28 million in federal Medicaid dollars. Why it matters: Nebraska has the nation's highest DSP turnover rate at 50.2%, up from 11th highest in the previous study. The state faces a 19% worker shortage (711 positions) and 2,400 individuals on the waitlist for services. Without adequate wages, private providers will close, forcing the state to provide services at the more expensive Beatrice State Developmental Center. What they're saying: Alana Schriver, executive director of the Nebraska Association of Service Providers, explained the problem bluntly: "We're competing with those businesses just down the street." A job coach helping someone with disabilities fill out a Menards application watches the person they're supporting earn $3 more per hour than them—and the coach leaves. Ernie Goss, the economist who conducted the study, noted that 1,724 parents are currently out of the workforce because they cannot afford DSP care for their children. By the numbers: 67% of living wage; 50.2% turnover rate; 711-worker shortage; 2,400 on waitlist; $1.40 return for every $1 invested. What's next: No vote was taken. The bill received 14 online proponent comments and zero opponent comments.
Committee sentiment: Supportive: Sen. Spivey
Sentiment estimated from questions and comments — not stated positions.
LB55: Restore Medicaid reimbursement for dual-eligible behavioral health clients
Introduced by: Sen. Myron Dorn | Testimony: 3 proponents, 1 opponents, 0 neutral | Read bill text (PDF)
A 2024 Medicare policy change intended to expand behavioral health access instead cut reimbursement in half for Nebraska's most vulnerable mental health clients. When Medicare began credentialing master-level mental health practitioners in January 2024, it became the primary payer for dual-eligible clients (those with both Medicare and Medicaid). The problem: Medicare reimburses at approximately $93 per session while Medicaid previously paid $187—a 50% cut for the exact same service to the exact same population. LB55 seeks $1.5 million to restore the difference. Why it matters: Dual-eligible clients are primarily elderly and low-income Nebraskans—widows dealing with depression, trauma survivors, legally blind individuals managing anxiety. Behavioral health providers across the state are now forced to choose between financial ruin or abandoning these clients. Blue Valley Behavioral Health alone has placed over 100 dual-eligible clients on waitlists. What they're saying: Jon Day, Blue Valley's executive director, described the bind: "Master-level counselors statewide who were treating dual-eligible clients are now receiving half the reimbursement for this exact same service for the exact same people." Chase Francl at Mid-Plains Center noted his agency represents only 10% of caseload but 21% of therapy services—removing them means 250 clients lose access. Annette Dubas, representing behavioral health organizations, presented a CMS FAQ suggesting Medicaid should be able to pay the difference, but DHHS declined to pursue a state plan amendment. By the numbers: 50% reimbursement cut; $200,000 projected loss at one provider; 100+ clients on waitlists; dual-eligible population primarily 65+. What's next: No vote was taken. The bill received 21 online proponent comments and zero opponent comments. DHHS opposes the bill, citing coordination of benefits policy consistency.
Committee sentiment: Skeptical: Sen. Armendariz, Sen. Spivey
Sentiment estimated from questions and comments — not stated positions.
LB57: Increase Medicaid waiver assisted living facility reimbursement rates
Introduced by: Sen. Myron Dorn | Testimony: 6 proponents, 0 opponents, 0 neutral | Read bill text (PDF)
Nebraska's assisted living facilities are closing at alarming rate as Medicaid reimbursement fails to cover actual cost of care. Thirty-three assisted living facilities have closed since 2017, with inadequate Medicaid rates cited as the primary cause. Current reimbursement—$62.73 for rural and $73.91 for urban facilities—has not increased since mid-2023, while costs for labor, food, insurance, and utilities have surged. LB57 proposes raising rates to $88.24 (FY 2025-26) and $91.78 (FY 2026-27), achieving parity between rural and urban rates based on a 2021 DHHS cost study. Why it matters: Nebraska's population over 75 is increasing exponentially while the caregiver support ratio declines from 6:1 to 3:1 by 2040. Assisted living is the most cost-effective level of care, preventing unnecessary and far more expensive nursing home placement. Yet many facilities now limit or refuse Medicaid residents because they lose $35 per bed per day. In Kearney, only 80 of 425 licensed assisted living beds accept Medicaid. What they're saying: Marv Fritz, a rural facility operator, reported a $176,000 annual loss on nine Medicaid residents while private pay residents subsidize the gap. "We're at a crossroads," he told the committee. Hannah Graham, administrator of Parkview Lodge in Rushville (6.5 hours from Lincoln), works in the kitchen and scrubs carpets herself to make ends meet. "The inability for us to pay current staffing costs...will lead Nebraska to another nursing facility closure," she warned. By the numbers: 33 closures since 2017; $35 daily loss per Medicaid bed; only 20% of Kearney beds accept Medicaid; 30% population increase projected by 2030. What's next: No vote was taken. The bill received 55 online proponent comments and zero opponent comments.
Committee sentiment: Supportive: Sen. Prokop, Sen. Cavanaugh
Sentiment estimated from questions and comments — not stated positions.
LB188: Increase Medicaid nursing facility reimbursement rates
Introduced by: Sen. Robert Dover | Testimony: 5 proponents, 2 opponents, 1 neutral | Read bill text (PDF)
Nebraska's nursing home crisis is accelerating: 16 closures in four years, aging population doubling, and reimbursement rates failing to cover actual costs. LB188 requests a modest 3% increase in Medicaid nursing facility reimbursement ($13 million in FY 2025-26, $14 million in FY 2026-27) to address surging costs in labor, food, medical supplies, and unfunded federal mandates. The bill comes as Nebraska loses nursing homes at an alarming rate, with Valentine's 2021 closure creating a care desert in western Nebraska. Why it matters: Nebraska's population over 85 is projected to nearly double from 44,000 to 80,000 by 2040, yet the state is closing the very facilities needed to serve them. Sixty-one percent of Nebraska nursing homes are nonprofit or governmental—a benevolent ecosystem unique nationally—but many are operating at break-even or negative margins. When facilities close, elderly residents are forced to travel hours away from family and community, with documented health consequences. What they're saying: Jay Colburn, administrator at York General, described the cascading closures: Tilden, Utica, Exeter, and Valentine. "We've already kind of covered that the country is aging; Nebraska is aging faster than the country on average, and rural is aging more quickly than urban areas," he testified. Kate Reiners at Elwood Care Center reported her facility costs $300 per day to care for seniors but Medicaid reimburses $205—a $95 daily loss on 50% of residents. She raised private pay rates 20% to cover the shortfall. Jalene Carpenter, representing 170 skilled nursing facilities, emphasized the problem is not certificate of need laws but an inadequate funding system: "If we're serious about keeping facilities open, we would appreciate a 3% increase because that's reasonable, but if we truly want to address the issue upstream, it is to reconcile to cost." By the numbers: 16 closures in 4 years; 85+ population projected to nearly double by 2040; 61% nonprofit/governmental ownership; $95 daily loss per Medicaid resident at some facilities. What's next: No vote was taken. The bill received 46 online proponent comments, 2 opponent comments, and 1 neutral comment.
Committee sentiment: Supportive: Sen. Dorn, Sen. Cavanaugh, Sen. Armendariz, Sen. Spivey
Sentiment estimated from questions and comments — not stated positions.
Session Notes
The Appropriations Committee heard four bills from Sen. Myron Dorn (LB54, LB55, LB57) and one from Sen. Robert Dover (LB188) on March 11, 2025. Committee Chair Rob Clements noted this was unusual—three bills from one senator in one afternoon. All bills focused on Medicaid reimbursement rates across different service categories: dental, developmental disability services, behavioral health, assisted living, and nursing facilities. No votes were taken on any bills. The hearing highlighted a consistent theme across multiple service sectors: inadequate Medicaid reimbursement rates failing to cover actual costs of care, leading to provider closures, workforce shortages, and reduced access to services—particularly in rural Nebraska. Committee members expressed concern about the aging population and the need to maintain services in rural communities to prevent displacement of elderly residents from their hometowns and families.
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