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Nebraska and the ACA’s Medicaid expansion

Medicaid expansion took effect in October 2020; CMS has approved a work requirement for enhanced benefits as of April 2022

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Nebraska’s Medicaid program was overhauled in 2016 as Heritage Health, which took effect January 1, 2017, combining all necessary care into one coordinated system, utilizing three managed care companies (Nebraska Total Care, UnitedHealthcare Community Plan of Nebraska, and Wellcare of Nebraska).

Enrollment in expanded Medicaid took effect in 2020; nearly 11,000 applications submitted in the first two months

Medicaid expansion – dubbed the Heritage Health Adult Program – took effect in Nebraska as of October 2020 (enrollment began on August 1, 2020), under the terms of the ballot initiative that was approved by the state’s voters in the 2018 election (details below).

Under the newly expanded eligibility rules, adults with income up to 138 percent of the poverty level are eligible for Medicaid in Nebraska. Enrollment began on August 1, 2020, and 10,772 people had enrolled by the beginning of October.

The state initially expected roughly 90,000 people to become newly eligible for Medicaid coverage in Nebraska under the expanded eligibility guidelines (for perspective, there were about 242,000 people enrolled in Medicaid/CHIP in Nebraska as of 2019), but a recent Families USA analysis indicates that an additional 33,000 people could be eligible due to the job losses caused by the COVID-19 pandemic. So the number of newly eligible residents could be as high as 123,000. Enrollment is likely to increase during the open enrollment period for individual market coverage, as people with income from 100-138 percent of the poverty level (who were previously eligible for premium subsidies in the exchange) transition to Medicaid.

Prior to Medicaid expansion, non-disabled Nebraska adults without dependent children were not eligible for Medicaid, regardless of how low their income was. Parents with minor children were eligible for Medicaid with a household income of up to 63 percent of the poverty level (58 percent plus a standard 5 percent income disregard; that amounts to about $16,500 for a family of four in 2020). The coverage gap in Nebraska meant that there were approximately 16,000 low-income residents without any realistic access to coverage before the state expanded Medicaid. As of October 2020, however, there is no longer a coverage gap in Nebraska.

Nebraska took a protracted approach to implementation of Medicaid expansion, with nearly a two-year delay between when voters approved Medicaid expansion and when coverage takes effect (for perspective, voters in Utah and Idaho approved Medicaid expansion at the same time, and expanded coverage in those states took effect in January 2020).

Medicaid expansion was also implemented in Maine as a result of a ballot initiative. And in the summer of 2020, voters in Oklahoma and Missouri approved similar measures; expansion will take effect in those states by mid-2021.

Medicaid expansion: Voters said yes in 2018, but implementation was delayed until late 2020

After lawmakers in Nebraska rejected Medicaid expansion for six years, proponents of Medicaid expansion took the issue to the state’s voters in the 2018 election.

Nebraska State Senator Adam Morfeld (D-Lincoln) introduced Legislative Resolution 281CA during the 2018 session, calling for a constitutional amendment to be on the ballot, declaring health care a right and expanding Medicaid in Nebraska. But that measure did not advance in the Health and Human Services Committee.

Instead, supporters began working on a ballot initiative that would propose a Medicaid expansion law, instead of a constitutional amendment (in Nebraska, 7 percent of voters must sign a petition to get a proposed law on the ballot, as opposed to 10 percent for a constitutional amendment). Medicaid expansion proponents began collecting signatures in March 2018, and successfully gathered enough signatures; the Nebraska Secretary of State confirmed in late August that Medicaid expansion would be on the ballot in Nebraska in November 2018. A judge rejected efforts by Nebraska GOP Senators who tried to block the ballot initiative based on “procedural, statutory and constitutional flaws.”

Nebraska Initiative 427 passed with 53 percent of the vote. It required the state to expand Medicaid as called for in the ACA (ie, to people earning up to 138 percent of the poverty level). According to the terms of the initiative, the state had to submit an expansion plan to the federal government by April 1, 2019.

On April 1, the Nebraska Department of Health and Human Services announced the details of their Medicaid expansion proposal, and also submitted their state plan amendments to the federal government. The state has also maintained a web page with a variety of information about the Medicaid expansion process. But Governor Pete Ricketts has long opposed Medicaid expansion, and while his administration is implementing the voter-approved Medicaid expansion, they’re doing it on a very delayed timeline—a fact that Ricketts made clear soon after the ballot initiative passed. They’re also rolling out a two-tiered system, with enhanced benefits available for enrollees who participate in care management and, starting in the second year of the program, fulfill a community engagement/work requirement (this is described in more detail below, and was approved by the federal government in October 2020).

The specifics of Nebraska’s Medicaid expansion 1115 waiver, approved by CMS in October 2020 (to be implemented in April 2021 and April 2022)

Although lawmakers in Utah and Idaho passed legislation in 2019 to adjust the terms of the Medicaid expansion ballot initiatives that voters had passed in those states, Nebraska lawmakers did not (and they did include funding for the state’s share of the cost of the first nine months of Medicaid expansion in the budget that was signed by Ricketts in May 2019). Instead, the Nebraska-specific modifications to Medicaid expansion have come from Governor Ricketts’ administration. And while the modifications are not as draconian as those implemented in other states (including Utah and Idaho, although those states have since suspended some of their more restrictive limits on Medicaid expansion), Nebraska is still deviating from the version of Medicaid expansion called for in the ACA — and approved by the state’s voters — and is adding administrative cost and additional complexity.

To expand Medicaid, Nebraska has added the Heritage Health Adult Program to its existing Heritage Health Program. Initially, the state had planned to transition about 25,000 low-income parents and caretaker relatives — who are already eligible for Medicaid in Nebraska — to the Heritage Health Adult Program (despite the fact that the federal government will only continue to pay the state’s normal match rate (52 percent) for these enrollees, rather than the enhanced (90 percent) matching rate that applies to the newly-eligible population). But the draft 1115 waiver proposal that the state published in October 2019 noted that the Heritage Health Adult Program would only include people who are newly eligible for Medicaid under the expansion guidelines (ie, adults with incomes up to 138 percent of the poverty level who would not have been eligible without expansion).

An 1115 waiver proposal for the final version of the state’s Heritage Health plan was submitted to CMS in December 2019 for federal review. It was approved by CMS in October 2020, a few weeks after Medicaid expansion took effect in the state. Nebraska has posted a series of FAQs about the newly approved waiver, which will take effect in April 2021 (the work requirement will take effect in April 2022).

Under the state’s approved waiver, the Heritage Health Adult Program will have a basic level of coverage, modeled after the Blue Cross Blue Shield Pride plan, which is one of the largest small-group plans in Nebraska. All residents who are eligible for expanded Medicaid will qualify for at least the Basic Coverage.

Enrollees will be able to qualify for Prime Coverage starting in the spring of 2021 if they meet additional requirements. Prime Coverage will include coverage for dental, vision, and over-the-counter drugs. In order to receive Prime Coverage in the first year, enrollees will need to participate in care and case management, select a primary care provider, and have an annual checkup.

Starting in year two (ie, April 2022 and beyond), enrollees will also have to fulfill a work requirement in order to qualify for Prime Coverage. For 80 hours each month, they will need to either be working (or participating in job seeking activities through the state), going to school, volunteering for a public charity, or serving as a caregiver for a relative.

In order to retain eligibility for Prime Coverage, members will need to promptly notify the state Medicaid department of any pertinent changes in circumstances, and will have to avoid missing medical appointments without notifying the doctor’s office. Members who miss three or more medical appointments without notifying the doctor’s office would be locked out of Prime Coverage for the remainder of their current coverage period and for the next two coverage periods. [A coverage period will be six months long; Nebraska plans to continue to use annual redeterminations for overall Medicaid eligibility, but eligibility for Basic or Prime coverage in the Heritage Health Adult program will be based on six-month intervals.]

According to the state’s proposal, Nebraska officials expect nearly a third of the newly-eligible population to qualify for only the Basic benefits.

Not surprisingly, the different levels of coverage (ie, traditional Medicaid for pregnant, disabled, and elderly adults, Basic Coverage for some adults, and Prime Coverage for other adults) is expected to significantly increase administrative costs for Nebraska’s Medicaid program.

Nebraska’s waiver proposal also sought federal permission to eliminate retroactive eligibility for most Heritage Health Adult Program enrollees, and instead grant coverage no earlier than the first of the month the application is submitted. But CMS did not approve this part of the proposal, which would have cost hospitals a significant amount of money.

The state initially planned to seek a federal waiver allowing the state to discontinue the Early and Periodic Screening Diagnostic and Treatment benefit for enrollees who are 19-20 years old. This is a federal Medicaid provision but Nebraska initially wanted to treat all able-bodied adults ages 19-64 in the same manner. In the official 1115 waiver proposal, however, the state has noted that all 19- and 20-year-olds who are gain Medicaid eligibility as a result of expansion will automatically receive Prime Coverage, which will include EPSDT benefits (see page 12 of the waiver proposal).

Although the state has implemented Medicaid expansion, they’re doing so in a costly and complicated manner and took an inordinately long time to get the program up and running. And the new 1115 waiver with tiered benefits levels will add administrative complexity and costs starting in 2021, and again in 2022 when the work requirement for enhanced benefits takes effect.

Past efforts to expand coverage via legislation were unsuccessful

In 2013, LB577, which would have created a modified Medicaid expansion program, was rejected by the legislature in Nebraska. A year later, the Wellness in Nebraska Act (LB887) was introduced in January 2014 by Senator Kathy Campbell, but it didn’t pass during the 2014 legislative session, and was indefinitely postponed in April 2014.

The Wellness in Nebraska Act would have expanded traditional Medicaid to people with incomes up to the poverty level (those who are currently in the coverage gap), and would have relied on federal Medicaid funding to purchase private coverage for people with incomes between 100 percent and 138 percent of poverty. Several states are using waivers to implement unique approaches to Medicaid expansion, and New Hampshire and Arkansas both use waivers purchasing private coverage for at least some Medicaid enrollees.

In 2015, lawmakers introduced Legislative Bill 472 to expand Medicaid, but it did not pass out of committee. Also in 2015, two professors from the University of Nebraska-Kearney published the results of a study that found that expanding Medicaid would result in significant financial benefits for the state. After exhaustive study, the researchers concluded that expansion of Medicaid “passes a rigorous cost/benefit analysis.”

In January 2016, Nebraska State Senator John McCollister (R, Omaha), introduced Legislative Bill 1032 in an effort to expand Medicaid in Nebraska. McCollister had been leading the push for Medicaid expansion in the state for almost a year at that point, but his legislation failed to advance out of committee.

LB1032 would have been a privatized approach to Medicaid expansion, similar to the system Arkansas implemented in 2014, and New Hampshire implemented in 2016 (New Hampshire has abandoned the private approach, however, and switched to Medicaid managed care). LB1032 also included optional education and job skills training for Medicaid enrollees, in an effort to help them transition to higher-paying jobs and away from public assistance programs like Medicaid.

In early discussions, Governor Ricketts reiterated his opposition to Medicaid expansion, including the privatized version proposed in LB1032. Conservative lawmakers were opposed to LB1032 as well, ultimately dooming it. The 2016 legislative session ended in Nebraska with no progress towards Medicaid expansion or closing the state’s coverage gap.

And in 2017, just before the start of the Trump Administration, Sen. Morfeld introduced LB441, which called, yet again, for Medicaid expansion in Nebraska. But a legislative committee decided to take no action on the bill in the spring of 2017, as the state waited to see what would happen in terms of health care reform at the federal level (at that point, ACA repeal bills were still very much under consideration in Congress, although they all ultimately failed later in 2017).

Who is eligible for Medicaid in Nebraska?

Nebraska’s Medicaid eligibility guidelines changed in August 2020, although coverage for newly-eligible adults won’t begin until October 2020. Coverage is available for the following populations:

  • Adults through age 64 with income up to 138 percent of the poverty level (note that the eligibility requirements are more stringent for people who have a disability and are also eligible for Medicare prior to age 65).
  • Pregnant women with household income up to 199 percent of poverty.
  • Children with household income up to 218 percent of poverty

How does Medicaid provide financial assistance to Medicare beneficiaries in Nebraska?

Many Medicare beneficiaries receive Medicaid financial assistance that can help them with Medicare premiums, lower prescription drug costs, and pay for expenses not covered by Medicare – including long-term care.

Our guide to financial assistance for Medicare enrollees in Nebraska includes overviews of these programs, including Medicaid long-term care benefits, Extra Help, and eligibility guidelines for assistance.

How do I enroll for Medicaid in Nebraska?

You can submit an application for Medicaid any time during the year. Applications can be made online or by phone.

If you are under 65 and don’t have Medicare:

  • You can enroll online at at any time – Medicaid enrollment is available year-round.  You can also enroll by phone via the call center at 800-318-2596.
  • You can also enroll online at ACCESSNebraska at any time.
  • The Do I Qualify screening tool at ACCESSNebraska can help you determine which public programs you’re eligible for: You may be able to enroll in other benefits beyond Medicaid.

If you’re 65 or older or have Medicare:

Nebraska Medicaid enrollment numbers

By mid-April 2014, 9,879 Nebraska exchange applicants had enrolled in Medicaid or CHIP. They were already eligible based on the pre-2014 enrollment guidelines, but may not have known that Medicaid was available to them.

But from the fall of 2013 through July 2016, total net enrollment in Nebraska’s Medicaid program actually declined by 9,764 people, which amounted to a decrease of 4 percent. By early 2020, however, enrollment was back to nearly where it had been in 2013, with only 188 fewer enrollees.

The state estimated that about 90,000 people would gain coverage under Medicaid expansion, although that number is likely to be higher now that the COVID-19 pandemic has resulted in widespread job losses. The pandemic had increased the number of people relying on Medicaid even before expansion took effect.

Coordinated system has three managed care organizations

As of 2013, nearly 76 percent of Nebraska’s Medicaid enrollees were in managed care programs run by Aetna, AmeriHealth, and UnitedHealthcare. The state overhauled its Medicaid managed care system in 2016, and managed care contract bids were submitted by six carriers in early January.

The overhauled program is called Heritage Health, and it combines coverage (for Medicaid and CHIP) of physical health, behavioral health, and pharmacy care into one coordinated system. The new system took effect January 1, 2017. Three carriers were awarded contracts to serve as managed care plans under Heritage Health:

  •  Nebraska Total Care (Centene)
  • UnitedHealthcare Community Plan
  • Wellcare of Nebraska

These three carriers will also serve the new Heritage Health Adult population once Medicaid expansion takes effect in late 2020.

Nebraska Medicaid history

Nebraska implemented Medicaid in July 1966, just a few months after the first wave of states did so in January of that year.

The federal match rate for Medicaid (the portion that the federal government pays, in addition to what the state pays) is tied to the per capita income in the state, and rising incomes in Nebraska mean that the federal match rate for Medicaid costs decreased from 53.27 percent to 51.16 percent in 2016.

This was the lowest federal match rate in the history of Nebraska’s Medicaid program, and the impending decrease led the Nebraska Department of Health and Human Services to request $76 million from the legislature in October 2014, to cover the anticipated budget shortfall over the upcoming two fiscal years.

By fiscal year 2018, Nebraska’s federal match rate had increased slightly, to 52.55 percent.

To address the COVID-19 pandemic, the Families First Coronavirus Response Act gives states an additional 6.2 percent in federal matching funds for Medicaid.

Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

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Apply for Medicaid in Nebraska

You can enroll online at or use the call center at 1-800-318-2596.  You can also enroll online at ACCESSNebraska, or print a paper application from their website.

Eligibility: Parents with dependent children are eligible with household income up to 57% of poverty.  Pregnant women with income up to 194% of poverty, and children with income up to 213% of poverty.

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