PREPARED BY: Mikayla Findlay
LB 380 DATE PREPARED: February 24, 2025
PHONE: 402-471-0062
Revision: 00
FISCAL NOTE
LEGISLATIVE FISCAL ANALYST ESTIMATE
ESTIMATE OF FISCAL IMPACT – STATE AGENCIES (See narrative for political subdivision estimates)
FY 2025-26 FY 2026-27
EXPENDITURES REVENUE EXPENDITURES REVENUE
GENERAL FUNDS See below See below
CASH FUNDS
FEDERAL FUNDS
OTHER FUNDS
TOTAL FUNDS See below See below
Any Fiscal Notes received from state agencies and political subdivisions are attached f ollowing the Legislative Fiscal Analyst Estimate.
This bill adds requirements for the Division of Medicaid and Long-Term Care with the Department of Health and Human Services
(DHHS) and places restrictions on contractors in the medical assistance program, specifically Managed Care Organiz ations (MCOs),
through which a majority of Medicaid services are channeled.
Pertaining to new requirements of MCOs, the bill:
• prohibits MCOs from reducing rates lower than what is published by DHHS
• prohibits MCOs from limiting mental health and substance use disorder coverage more than other conditions
• requires MCOs to maintain adequate provider networks for mental health and substance use d isorder services
• requires MCOs to utilize generally recognized standards of care criteria and make utilization review policies p ublic
• and prohibits MCOs from modifying including revoking authorization for mental health and substance use disorder services
after the provider renders such service.
Pertaining to new requirements of DHHS Division of Medicaid and Long-Term Care, the bill requires :
• contractor compliance with federal and state laws for coverage of mental health and substance use disorder
• all surveys, financial analyses, contract audits and parity reports th at are prepared by a contractor to be made public
• accessibility of mental health and substance use disorder providers through regulation, network adequacy, and provider rate
adequacy
• establishment of a monthly electronic communication system with all Medicaid providers and communicate any change in the
contracts with MCOs
• definition of network adequacy
• and annual posting of the criteria the Division uses to assess network adequacy of each MCO on the DHHS websi te.
The agency expects the provision to result in increased aid expenditures due to MCO rates currently being less than fee-for-service in
some instances. Currently , MCOs are allowed to negotiate rates with providers which can result in rates higher or lower than po sted
Medicaid rates. A provider may enter into a contract for a lower rate due to corporate agreement or contingency requirements. DHHS
notes additional staff time would be required to update regulations, the costs of which can be absorbed.
ADMINISTRATIVE SERVICES STATE BUDGET DIVISION: REVIEW OF AGENCY & POLT. SUB. RESPONSE
LB: 380 AM: AGENCY/POLT. SUB: Nebraska Department of Health & Human Services
REVIEWED BY: Ann Linneman DATE: 2 -24-2025 PHONE: (402) 471-4180
COMMENTS: Concur with the Nebraska Department of Health and Human Services’ assessment of fiscal impact.
LB (1) 380 FISCAL NOTE 2025
ESTIMATE PROVIDED BY STATE AGENCY OR POLITICAL SUBDIVISION
State Agency or Political Subdivision Name:(2) Department of Health and Human Services
Prepared by: (3) John Meals Date Prepared 2-24-25 Phone: (5) 471-6719
FY 2025-2026 FY 2026-2027
EXPENDITURES REVENUE EXPENDITURES REVENUE
GENERAL FUNDS
CASH FUNDS
FEDERAL FUNDS
OTHER FUNDS
TOTAL FUNDS See Below $0 See Below $0
Return by date specified or 72 hours prior to public hearing, whichever is earlier.
Explanation of Estimate:
The Department of Health and Human Services (DHHS) would expect an increase in Medicaid aid
expenditures if this bill were to pass; however, the fiscal impact of LB380 is indeterminable at this time.
The expected increase in aid expenditures is tied to LB380’s requirement that Medicaid managed care
organizations (MCOs) would be prohibited from contracting at rates below the fee-for-service (FFS) Medicaid
fee schedule rate. Currently, MCOs are allowed to negotiate rates with providers, and this could result in them
contracting rates either above or below posted Medicaid FFS rates. There are currently situations where
providers agree to contract with MCOs at rates below the Medicaid Fee schedule. This could be because a
provider has a national agreement with the parent corporation of the MCO or the MCO/provider agrees to
value based reimbursement where the base is lower but includes upside if certain outcomes are met.
DHHS also estimates increased staff time that would need to be allocated to complying with other sections of
this bill. LB380 could require updates to regulations, MCO contracts and capitation rates, creating and
publishing additional reports and information, and establishing a monthly communication system with all
healthcare providers participating with Medicaid. The additional time and costs associated with these
requirements will be absorbed by the Department.
MAJOR OBJECTS OF EXPENDITURE
PERSONAL SERVICES:
NUMBER OF POSITIONS 2025-2026 2026-2027
POSITION TITLE 26-26 26-27 EXPENDITURES EXPENDITURES
Benefits...............................................................................................................................
Operating............................................................................................................................
Travel..................................................................................................................................
Capital Outlay.....................................................................................................................
Aid......................................................................................................................................
Capital Improvements.........................................................................................................
TOTAL............................................................................................................