Platte Institute Releases First Annual Report on Nebraska’s Medicaid Expansion Costs

 OMAHA, NE — The Platte Institute has released its first annual report detailing the cost of Medicaid expansion in Nebraska. The report shows that the program, created under Nebraska Initiative 427 and approved by voters in 2018, has exceeded early cost projections and could potentially limit the state’s ability to fund other priorities or provide future tax relief.  

The report, which will be updated annually, sheds light on how Medicaid expansion in Nebraska has already cost the state nearly $103 million in 2023 alone. Over time, the total cost of the program, when combined with federal spending, has reached nearly $1 billion per year. This raises significant concerns about the sustainability of the program as federal finances continue to face mounting pressure. 

Jim Vokal, Chief Executive Officer of the Platte Institute, said, "Many states have seen their Medicaid expansion programs balloon beyond projections, and Nebraska is no exception. As we warned in previous forecasts, even while federal funds cover 90% of the costs, the state's share is growing faster than expected, crowding out other critical areas of our state budget and potentially limiting future tax cuts." 

Key findings from the report include: 
Rapid Cost Growth: Nebraska’s Medicaid expansion cost the state $52.9 million in 2021 and has since increased to nearly $103 million in 2023. The total program cost, including federal contributions, is nearing $1 billion annually. 

Crowding Out Other Priorities: With Medicaid expansion costs rising, there are concerns that limited state resources will be diverted from other essential programs or hinder opportunities for tax relief. 
Need for Oversight: The Platte Institute emphasizes the need for greater scrutiny of Medicaid spending, as future changes to federal match rates could dramatically increase Nebraska’s financial burden. 

"Our goal with this annual report is to provide policymakers and taxpayers with clear, transparent data on the long-term costs of Medicaid expansion," Vokal added. "We believe it's vital to monitor these trends and explore potential reforms to ensure Nebraska’s fiscal health."