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Committee weighs bill to slow Nebraska’s rollout of federally mandated Medicaid work requirements

Nebraska Legislature Health and Human Services Committee · February 11, 2026

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Summary

LB723 would require DHHS to adopt the broadest exemptions and delay state implementation of Medicaid work requirements until the federal deadline (Jan. 1, 2027). Supporters said the bill would reduce coverage loss and administrative expense; DHHS opposed some provisions and defended its planned earlier implementation.

Senator Dan Quick told the committee LB723 directs DHHS to adopt all optional short‑term hardship exemptions, use the broadest definition of "medically frail," accept participant statements where feasible, automate data checks and not implement work requirements before the federal deadline of Jan. 1, 2027. "This bill aims to ensure DHHS is able to implement these historic changes efficiently and effectively while also preventing any unnecessary coverage loss," Quick said.

Proponents from Nebraska Appleseed, OpenSky, the Nebraska Hospital Association and other health and advocacy groups warned that other states' experience shows work requirements can be administratively costly and lead to significant disenrollments without improving employment outcomes. Kelsey Ahrends of Nebraska Appleseed cited Arkansas and Georgia implementation costs and urged safeguards to minimize paperwork‑driven coverage loss.

DHHS opposed the bill's delay and some mandatory language, saying the department planned a May 2026 implementation and has been working with CMS and expects some federal implementation funds and systems support. DHHS officials estimated 13,000–20,000 people might need to demonstrate compliance after exemptions and cross‑checks.

Lawmakers asked detailed questions about costs, administrative phon, and whether federal funds are available to support set‑up; DHHS said there were limited federal planning grants and higher match rates for systems improvements under standard Medicaid mechanisms.

The committee heard proponents and opponents over a multi‑hour hearing and took no final action during the session.