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Bill would codify protections that keep ABLE-account distributions from Nebraska Medicaid recovery
Summary
LB 1240 would add a statutory clarification preventing Nebraska Medicaid from recapturing amounts distributed from Enable (ABLE) accounts at a beneficiary's death; advocates said the change would reassure families and boost participation in the state's Enable savings plan.
Senator Dave Merman introduced LB 1240 to add explicit statutory protection that amounts distributed from an ABLE (Enable) account would not be subject to Nebraska Medicaid recovery upon the death of the account’s beneficiary. The sponsor said the change addresses a common family concern that future recapture could undermine the purpose of these tax-advantaged savings accounts for individuals with disabilities.
Shauna Paolini, Enable savings plan director, told the committee Enable holds roughly $61,000,000 across about 5,200 accounts and that program limits allow account owners to preserve eligibility for benefits while saving. Paolini and other proponent witnesses said families are still hesitant to open accounts because of fear that funds transferred out of an ABLE account at death could be clawed back by Medicaid; LB 1240 would clarify that distributed amounts also are protected from Nebraska Medicaid recapture.
Paolini described program mechanics and eligibility checks; she said the total annual contribution limit is $20,000, the total account cap is $550,000 and a $100,000 threshold is relevant to preserving certain benefit eligibility. She said account ownership and authorized individuals are recorded and transfers at death can be made to another account or an estate, as permitted by federal law.
Stacy Pfeiffer, a former Enable director, and family advocates emphasized the bill’s practical impact: they said codifying the protection would encourage more families to open accounts, unlock private donations for individuals with disabilities and give families control over remaining funds. Stacy Taney, a parent of a child with Batten disease, delivered emotional testimony about using Enable to pay for therapies and adaptive equipment and asked the committee to preserve funds for the intended beneficiaries.
Committee members asked about fraud protections and enrollment checks; Paolini described identity-verification steps and authorized-individual controls. No opponents appeared in person; the committee closed the hearing after proponent testimony and sponsor closing remarks.
Next steps: bill remains in committee for consideration.
