Lincoln, Nebraska — Nebraska’s nursing homes just scored a rare unanimous win at the state capitol, and the implications go well beyond the state’s borders.
Lawmakers passed LB1091 on April 10 by a vote of 49-0, carving skilled nursing facilities out of Nebraska’s Medicaid managed care program. Under the new law, long-term care services for Medicaid recipients with special needs must now be administered and reimbursed through fee-for-service — not through managed care organizations. Nursing homes can no longer be required to enroll in an MCO as a condition of providing those services.
The bill, introduced by Sen. Eliot Bostar of Lincoln, gives the state Department of Health and Human Services six months to amend its managed care contracts and update enrollment processes accordingly.
Why It Matters
Managed care has been a persistent source of frustration for nursing home operators across the country. Facilities have long complained that MCOs delay authorizations, underpay claims, and create administrative burdens that fee-for-service doesn’t. Nebraska’s unanimous vote signals that even in a state not known for aggressive long-term care policy, lawmakers are listening.
Nebraska isn’t the first state to take this step. Indiana made a similar move last year, pulling its nursing homes out of a managed care system that owed them $100 million in back payments — a decision that drew national attention from operators watching their own state Medicaid programs.
The Nebraska bill also came alongside a separate omnibus health measure, LB867, that includes a provision prohibiting the average weighted Medicaid nursing facility daily rate from falling below the rate in effect as of January 1, 2026. That’s a floor — a protection against rate cuts that operators in other states have been fighting for without success.
A 49-0 Vote Sends a Message
The unanimous margin is notable. In a political environment where healthcare votes often split along party lines, a 49-0 result suggests broad bipartisan agreement that the managed care model wasn’t working for Nebraska’s long-term care residents. It’s the kind of vote that other state legislatures will notice.
For nursing home operators in Nebraska, the practical effect is straightforward: they’ll deal directly with the state on reimbursement rather than navigating MCO contracts. For the industry nationally, it’s another data point in a growing argument that managed care and skilled nursing don’t mix well.
The law takes effect immediately.
