OMAHA, Neb. (KMTV) — The Nebraska Hospital Association wasted little time in the new year asking for more financial support from the state.
Saying more than half of the state's hospitals are operating in the red, the Nebraska Hospital Association is calling for a 9.6% Medicaid reimbursement rate this year, and 7.7% next year, after seeing a 2% bump each of the last two years.
"This is the biggest increase that the hospital association has ever come forward with," said the president of the association, Jeremy Nordquist.
He said inflation has significantly impacted the costs for Nebraska hospitals. They say drug costs are up 35%, labor costs are up 20%, supplies are up 15-20%, and food and utilities are up 10%. Overall, he says it's up more than 20% per patient compared to the pre-pandemic level. Most, he said, has been the cost of labor.
"If we don't address it, it's going to get worse," Nordquist said, "And it's going to impact the care that Nebraskans receive."
The struggles have left 54% of hospitals in the state operating in the red, he said, per a recent survey of the association's members.
"At the end of the day, health care is just something we can't gamble with," Nordquist said. "It's something we have to have in communities throughout our state. So we're optimistic that (the legislature) will work with us on it."
He said Nebraska hospitals get 60% to 80% of their revenue from government programs like Medicare and Medicaid. Medicaid is a joint federal and state program for low-income individuals. Medicare is a federal program for people 65 or older.
Nordquist said the margins have significant impacts. Hospitals that operate nursing homes have chosen to close the nursing home.
He said a central Nebraska had to close an inpatient behavioral health unit: "Something that's absolutely needed in the state."
"If they run in the red for too long, they've got to start making tough budget decisions," he said. "And that could be cutting services that Nebraskans need, especially in rural communities."
Sen. Dave Murman, a Republican who's been on the Legislature's Health and Human Services Committee, said his constituents have seen the impacts of struggling healthcare facilities — a nursing home closed. He said the Legislature should "look closely at raising reimbursement rates."
Sen. John Arch has been the committee's chair.
He said in a statement: "Inflation pressure is real in all segments of our economy and households. One of the major issues that the Appropriations Committee will wrestle with is how best to deal with those pressures in all areas of our state budget. That being said, healthcare is an essential service in our communities and our lives. The communication from our hospitals on this matter must be given serious consideration as the budget is finalized.”
Nordquist said hospitals lose money on Medicaid and Medicare patients.
"For years a lot of that cost was shifted over to people who have private insurance," he said. "And everyone else has to pay more because government's not carrying its weight with Medicare and Medicaid ... In the past (commercial insurance) has been willing to ... help with the shortfall. That negotiation is getting tougher for hospitals."
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