What Nebraska Loses Without LB 577, Initiative to Expand Medicaid Coverage

Nebraska and Nebraskans stand to suffer significant losses if the Nebraska Legislature fails to adopt LB 577, the bill that would implement the new Medicaid initiative for low-income working adults.

Money. The state will receive over $274 million in federal aid to implement the Medicaid initiative. The Legislature is turning its back on over $751,000 per day.

State Budget Savings. LB 577 would save the state nearly $3.7 million in the first year, and nearly $6 million over 3 years.

Lives. Enacting LB 577 would prevent over 300 deaths in Nebraska. One death per year would be prevented for every 176 adults covered under an expanded Medicaid program.

Business Penalties. Nebraska businesses are facing potential fines and penalties between $9.8 million and $14.7 million as a result of the Legislature failure to enact LB 577.

Higher Health Insurance Premiums and Higher Federal Costs. Nebraska has among the highest health insurance coverage rates in the nation through the individual market, especially in rural Nebraska. Without LB 577, Nebraska taxpayers will pay federal taxes for states that do expand their Medicaid programs, plus taxes for increased premium subsidies for states that do not. Taxpayers will get little in return for the Legislature’s inaction beyond higher insurance premiums.

Rural Hospitals. Without LB 577 rural Nebraska is in danger of losing its hospitals. Nebraska follows a national trend – the dependence of rural health care providers on public health insurance. LB 577 is one response that can financially save rural hospitals.

The full report (3 pages) is attached below.