Newsroom > DHHS News Release

For Immediate Release
February 9, 2016

CONTACT
Kathie Osterman, Communications and Legislative Services, (office) 402-471-9313 or kathie.osterman@nebraska.gov

DHHS Releases New Cost Estimate for Medicaid Expansion

LB 1032 Estimated to Cost State Nearly One Billion Dollars
Through 2027 if Enacted

Lincoln – The Nebraska Department of Health and Human Services’ Division of Medicaid and Long-Term Care (MLTC) today released a cost analysis for Medicaid expansion estimating the total cost in state funds for the program to be $978 million through 2027.  The additional $13.8 billion in federal funds bring the total cost to taxpayers to approximately $14.8 billion.  The 10-year projection comes from the state’s actuary, Optumas, after reviewing the provisions of LB 1032 sponsored by Senator John McCollister.

"This is a conservative estimate of the cost of an expansion," said Calder Lynch, Director of Medicaid and Long-Term Care.  "Because there are many uncertainties, these costs could rise with a change of the federal matching rate or the under-collection of member contributions as required in the bill. I have serious concerns from both a fiscal and policy perspective."
 
LB 1032 expands Medicaid eligibility up to 138% of the federal poverty level through three programs:  Premium assistance to purchase Qualified Health Plans on the Health Insurance Exchange, premium assistance to subsidize the employee share of employer-sponsored insurance, and the existing Medicaid managed care plan for individuals deemed to be medically frail. 
 
Lynch said Medicaid expenditures in Nebraska have doubled since 2000, from $983 million to over $2 billion today, covering over 231,000 individuals, and that expanding the program further is not sustainable.
 
The report prepared by Optumas is available here http://dhhs.ne.gov/medicaid/Documents/LB1032CostEstimate.pdf
 
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