Tuesday, February 20, marks Day 30 of the 60-day legislative session. So far, the session has been moving along at a good pace, and the demeanor on the legislative floor has been very positive. We have had some robust debate, but bills have been moving along quickly. It should be noted that most of the bills that have been scheduled thus far have been noncontroversial bills that advanced with a unanimous vote out of committee. I expect the second half of the session to be more challenging as more controversial bills are scheduled. Fortunately, every Senator has bills important to them that will need floor time, which is an incentive to keep moving. The Speaker will certainly be mindful of which bills to schedule and how to keep everyone focused on the bills to come.

This past week, I was able to introduce the full Legislature to LB1087 (Hospital Quality Assurance and Access Assessment Act). In my opening statement I said, “This may be the most impactful piece of Legislation that we have the opportunity to pass this session.” I say this because the passage of the bill will allow Nebraska to join 44 other states to tap into over $1 billion of new Medicaid dollars to be used by Nebraska hospitals that provide services to those who need Medicaid services.

From the middle of 2020 until now, the average cost to provide care at our hospitals is up 33.2% on average. Meanwhile, Medicaid rates have only increased an average of 2.25% per year. Due to inflation-forced expense growth and insufficient rate increases from public payers, a majority of Nebraska hospitals are now losing money from operations. This includes 59% of our small, rural critical access hospitals.

These financial dynamics have forced Nebraska hospitals to make difficult decisions. In the past 18 months, three rural hospitals have closed their labor and delivery units. Two hospitals closed their hospital-owned nursing homes. Hospitals have also eliminated behavioral health, hospice, and home health services. All of these were needed community services that could no longer be sustained by our non-profit hospitals with current reimbursement rates. Just this week, the first rural hospital in Nebraska made the transition to a Rural Emergency Hospital. This means this hospital will close its inpatient services and become a standalone Emergency Department with some outpatient services.

LB1087 allows Nebraska to leverage additional federal funds to support Medicaid rate increases for inpatient and outpatient hospital services. This is carried out through a partnership between the state and hospital providers. Under the proposal, hospitals would pay an assessment to the state – up to 6% of patient revenue that would be matched by the Center for Medicare and Medicaid Services (CMS). For each $1.00 in the program, the current federal match would be about $2.19. These Medicaid Directed Payments, as they are called, would then be distributed by the state to hospitals based on their share of Medicaid inpatient and outpatient services.

For the state to continue to qualify for this federal subsidy, the hospitals will need to collectively outperform four performance metrics agreed to by the State, CMS, and the hospital association. These metrics include improvements in behavior health outcomes for children and adults, aging and chronic care, maternal safety, and patient safety.

The bill passed the first round of debate on a vote of 40-0, with four senators absent and four “present not voting.” On to round two soon!

Speaker Arch will announce the rest of his Speaker Priority bills on Tuesday. I am hopeful that LB32 (Medigap Bill) will be included on the list. It was voted out of committee last week on a vote of 8-0 and I think it’s time to pass this legislation.

Julie and I had the opportunity to spend this past weekend in North Platte. On Saturday night, we had the opportunity to join former State Senator Dan Hughes at a fundraising gala in Grant to raise money for their new assisted-living facility. It was a wonderful evening and a great opportunity to connect with constituents in Perkins County. We look forward to attending similar events throughout the District in the coming weeks and months.

I look forward to continuing to hear from you regarding issues that are important to you. It is a privilege to serve as your State Senator, and I will continue to give my full effort to make a positive difference for the District and the State. You can reach me at mjacobson@leg.ne.gov or 402-471-2729.