Legislature’s Appropriations Committee mulls cuts to DHHS, Medicaid

Nebraska lawmakers pressed state officials on Monday over proposed budget cuts to the Department of Health and Human Services. Gov. Jim Pillen’s originally proposed plan would see roughly $150 million stripped from the agency over the next two years.The legislature’s Appropriations Committee brought in DHHS leaders before deciding on those cuts in the budget plan they brought to the floor.Rural health care, Medicaid and the future of DHHS dominated the marathon hearing, with some senators raising concerns about the impact of reductions on vulnerable residents. “What they are proposing are significant cuts to things like the Medicaid lookback and other programs that are really essential to day-to-day, folks,” Sen. Ashlei Spivey of Omaha said.DHHS CEO Steve Corsi defended Pillen’s approach and backed the cuts.“One of the things that the governor has asked us to do as department heads is to bring a running-government-like-a-business mentality into the executive branch,” Corsi said. “And I think we’ve been doing that.”Corsi highlighted consulting work with Epiphany, a company he previously worked for, saying the partnership has saved DHHS about $218 million a year. He added that the department expects to save even more under the governor’s budget recommendations.Among the most significant changes is a reduction in Medicaid retroactive eligibility from three months to one month. This comes as Nebraska is already set to become the first state to implement new Medicaid work requirements, which DHHS estimates could remove between 12,000 and 18,000 people from coverage come May.The proposal would also eliminate several currently vacant state positions and cut $2.7 million from pediatric cancer research funding, a move that drew questions from some lawmakers. “We say that the budget is a moral document,” Sen. Machaela Cavanaugh asked Corsi. “What is the message that you are intending to communicate to the people of Nebraska?”One piece of Pillen’s proposal that DHHS has already strayed away from was the capping of Medicaid waiver caregiver hours for Nebraskans with disabilities. The newest version of those changes will go before the public at a hearing on March 4.The Appropriations Committee will continue negotiating its version of the budget in the coming weeks before sending it to the full Legislature for debate in March.“We’re going to have to have very tough conversations about what are we prioritizing or not in the budget,” she said. “And I don’t think we need a compromise on Nebraskans’ health.”