NEBRASKA HOSPITALS, SCHOOLS SPARED DRASTIC CUTS FROM NEW MEDICAID RULES

Iraq Supplemental Bill Delays New Regulations that Shift at least $41 Million in costs to Nebraska

May 22, 2008 - Nebraska may be spared at least $41 million in looming drastic funding cuts to Medicaid programs that support Nebraska's hospitals and schools by a provision in the Iraq Supplemental Bill approved by the Senate today.

Congress has established a moratorium on a set of new and harmful Medicaid regulations that would reduce funds to Nebraska hospitals and schools. That moratorium, set to expire May 25, has been extended until next year and Congress plans to use the extra time work to find a way to improve the Medicaid system without simply forcing the costs onto the states.

"These cuts are dangerous and shortsighted and will hamper the ability of schools and hospitals to meet the needs of Nebraska families using Medicaid," said Senator Nelson. "Shifting costs does nothing to reduce costs or reform the system. As I have said before, when there's a shift in costs there’s usually a 'shifter' and a 'shiftee' and in this case it’s the states getting the shaft.'

Nebraska stands to lose at least $41 million in Medicaid funding through three of the most costly proposed regulations:

School Administration and Transportation - The proposed rule eliminates longstanding federal policy by prohibiting federal matching funds for (1) administrative activities by school employees or contractors and (2) transportation of school-aged children from home to school and back. This will cost Nebraska $27.7 million per year.
Graduate Medical Education (GME) - The proposed rule would no longer allow Medicaid funding to be used for Graduate Medical Education. This will cost Nebraska $10.8 million a year.
Rehabilitative Services - The proposed rule would prohibit federal matching funds for rehabilitative services furnished through a non-medical program (e.g., foster care, adoption services, education, and juvenile justice). This will cost Nebraska $2.6 million a year.

"I have long opposed forcing unfunded and underfunded federal mandates on states and local governments. When I served as Governor it was clear that the Federal Government thought of the states as field offices. Shifting these costs back to the states is unfair and I hope Congress can find a better solution than these proposed rules," said Nelson.

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	Press Release	May 22, 2008
NEBRASKA HOSPITALS, SCHOOLS SPARED DRASTIC CUTS FROM NEW MEDICAID RULES Iraq Supplemental Bill Delays New Regulations that Shift at least $41 Million in costs to Nebraska May 22, 2008 - Nebraska may be spared at least $41 million in looming drastic funding cuts to Medicaid programs that support Nebraska's hospitals and schools by a provision in the Iraq Supplemental Bill approved by the Senate today. Congress has established a moratorium on a set of new and harmful Medicaid regulations that would reduce funds to Nebraska hospitals and schools. That moratorium, set to expire May 25, has been extended until next year and Congress plans to use the extra time work to find a way to improve the Medicaid system without simply forcing the costs onto the states. "These cuts are dangerous and shortsighted and will hamper the ability of schools and hospitals to meet the needs of Nebraska families using Medicaid," said Senator Nelson. "Shifting costs does nothing to reduce costs or reform the system. As I have said before, when there's a shift in costs there’s usually a 'shifter' and a 'shiftee' and in this case it’s the states getting the shaft.' Nebraska stands to lose at least $41 million in Medicaid funding through three of the most costly proposed regulations: School Administration and Transportation - The proposed rule eliminates longstanding federal policy by prohibiting federal matching funds for (1) administrative activities by school employees or contractors and (2) transportation of school-aged children from home to school and back. This will cost Nebraska $27.7 million per year. Graduate Medical Education (GME) - The proposed rule would no longer allow Medicaid funding to be used for Graduate Medical Education. This will cost Nebraska $10.8 million a year. Rehabilitative Services - The proposed rule would prohibit federal matching funds for rehabilitative services furnished through a non-medical program (e.g., foster care, adoption services, education, and juvenile justice). This will cost Nebraska $2.6 million a year. "I have long opposed forcing unfunded and underfunded federal mandates on states and local governments. When I served as Governor it was clear that the Federal Government thought of the states as field offices. Shifting these costs back to the states is unfair and I hope Congress can find a better solution than these proposed rules," said Nelson. ###