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State Sens. Tony Sorrentino of the Elkhorn area and Danielle Conrad of Lincoln. Jan. 21, 2026. (Zach Wendling/Nebraska Examiner)
LINCOLN — A legislative proposal could be one of the last hurdles facing an $800 million deal meant to leave the University of Nebraska the sole owner of Nebraska Medicine, and the bill appears to be gaining traction after a restructuring late last week of the nonprofit’s board.
Legislative Bill 1125, from State Sen. Tony Sorrentino of the Elkhorn area, would require legislative approval before NU could acquire a controlling or sole interest in any hospital or health care facility valued at more than $100 million. That could include the planned deal for NU to assume sole ownership of Nebraska Medicine from its longtime partner, Clarkson Regional Health Services, which wants out.
“I think we need some review, and we’re not trying to do or undo the transaction,” Sorrentino told the Nebraska Examiner.
The bill has gotten more attention after NU and Clarkson announced Thursday that they were immediately changing the Nebraska Medicine Board of Directors, kicking off nearly all members and appointing a few new voting members from NU and Clarkson who are explicitly friendly to the ownership change.
“They took what I consider a nuclear action and blew the whole deal up,” State Sen. Brad von Gillern of the Elkhorn area said Friday.
Of Sorrentino’s bill, von Gillern said: “It is far more interesting today than it was yesterday.”
‘Incredibly short-sighted’
Von Gillern said he was “really disappointed” in the Thursday board shakeup. He had led more than 30 of his colleagues to ask Jan. 8 that regents take more time to review before voting. The vote was delayed one week, to Jan. 15, partly because of lawmakers’ recommendations.
On Jan. 14, NU and the former Nebraska Medicine board, which organized opposition to the deal, also made separate in-person last stands to lawmakers. Clarkson joined NU at its forum.
Among the pleas was one from the then-Nebraska Medicine board chair, Lance Fritz, for lawmakers to consider stepping in, an action NU says is unnecessary.
Von Gillern said the competing forums were meant to encourage a “deeper level” of conversation and engagement between the organizations. And while he says he has “no reason to doubt NU’s or Clarkson’s authority to change the board, he still worries about the fallout.
“I think it was incredibly short-sighted, from a corporate-citizenship standpoint, from recognizing the level of engagement by the civic community in Omaha and philanthropy,” von Gillern said.
‘Nobody likes surprises’
The NU Board of Regents, at its Jan. 15 meeting, unanimously authorized the transaction. Regents anticipate it will “close” by June 30, barring any other changes or roadblocks. NU agreed to pay Clarkson $500 million for its 50% share of Nebraska Medicine and $300 million for related properties.
In return, Clarkson would donate $200 million back to NU for “Project Health,” a $2.19 billion endeavor to build up the next generation of health care.
Less than 24 hours after the unanimous vote, the Nebraska Medicine board, under its previous leadership, filed a lawsuit in Douglas County to try to stop the deal. The suit argues that the parent organizations had not followed the law and left the former Nebraska Medicine board members out of necessary negotiations, including exploring possible alternatives.
State Sen. Merv Riepe of Ralston, a former hospital administrator, said he was skeptical Clarkson would leave Nebraska. He pointed to Fritz’s leadership, a former CEO and president of Union Pacific, as one reason why philanthropy in Omaha could be energized to step in.
Fritz had told lawmakers at least one philanthropist in Omaha might be interested.
Riepe said for the size of the NU-Clarkson deal, it needed a lot more communication, “maybe even up to the point of a year that says, ‘This is what’s being considered.’” The proposal was announced Jan. 2. Nondisclosure agreements went back to July 2024.
“Nobody likes surprises, and I think this was a surprise,” Riepe said of the deal. “A big surprise.”
Part of the reason for the quick action was concern about whether Clarkson might try to sell to an out-of-state or for-profit corporation. The university’s exclusive window for negotiations would have ended after Jan. 15, regents said.
As a fail safe, Sorrentino’s bill would also prohibit any hospital or academic health center that serves as the primary affiliate of UNMC — in this case, Clarkson — from selling all or part of its share to an out-of-state or for-profit entity, unless the state attorney general, in consultation with the NU Board of Regents, determines such changes are “in the public interest.”
Riepe said that in his experience, projects that don’t start well often don’t end well. He hopes that isn’t the case for the Nebraska Medicine changes.
Nonprofit board shakeup
NU and Clarkson on Thursday said the board restructuring came after “careful review” and as the owners had “serious concerns about recent actions and behavior” by board members. The two organizations also described the legal action as “extraordinary.”
The board restructuring could end the lawsuit, as the board’s now-four voting members include NU President Dr. Jeffrey Gold, interim University of Nebraska Medical Center Chancellor Dr. Dele Davies and Clarkson CEO Dr. Bill Lydiatt. All three have explicitly endorsed the transaction.
Those NU and Clarkson leaders are now, in effect, suing themselves. As of Friday afternoon, no additional legal motions had been filed in Douglas County District Court.
Should lawmakers get involved?
While von Gillern and Sorrentino want to have a deeper conversation, not all lawmakers are convinced the Legislature should get involved.
State Sen. Danielle Conrad of Lincoln, now in her 12th year as a state legislator, said she had been monitoring statements from NU, the former Nebraska Medicine board and Clarkson. She said that “like most challenging issues in public life,” each had good points.
“But I think, at the end of the day, where I am, is that I just don’t see a legislative issue or role in regards to resolution of this matter for a variety of different reasons,” Conrad said.
She and Riepe both pointed to a 1977 Nebraska Supreme Court case, named after former Gov. Jim Exon, in which the high court limited how much political influence the Legislature can exert over NU because the Nebraska Constitution gives that general governing power to the NU Board of Regents.
Said Riepe: “I don’t think that we need to put in another level of discussions that take a lot more time and a lot more fuss and everything else.”
In a statement to the Examiner, the regents said their action to acquire Clarkson’s share of Nebraska Medicine “is well within the bounds of the long-established constitutional powers” of the regents and that the board acted in “good faith” at the “opportunity” that Clarkson offered.
“We will continue to move forward in the best interest of the university, Nebraska Medicine and the students, patients and Nebraskans we serve,” the regents’ statement reads. “We believe this is best achieved without legislation.”
A Clarkson spokesperson said their organization was still reviewing Sorrentino’s bill. Nebraska Medicine declined to comment Friday.
‘Cooler heads could prevail’
Sorrentino’s bill has been sent to the Legislature’s Executive Board, chaired by State Sen. Ben Hansen of Blair. Hansen said Thursday’s shakeup “set a few hairs on fire” and that while lawmakers might have wanted to wait, Sorrentino’s bill might come for a hearing sooner.
Hansen said lawmakers planned to take a “breath” over the weekend and decide on scheduling soon.
While the transaction heads to “closing,” Sorrentino said he still thinks his bill could have an impact. He said the Legislature “probably owes taxpayers at least a review,” noting the price tag of the deal mirrors what state legislators have appropriated in baseline state tax dollars to NU.
“I wished that cooler heads could prevail and we could discuss this,” Sorrentino said Friday.
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