Rural hospitals in Nebraska facing financial crisis

“Critical access” healthcare facilities are in desperate need of financial help
Nebraska hospitals urge lawmakers to address financial issues
Published: Jan. 2, 2023 at 5:29 PM CST
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LINCOLN, Neb. (WOWT) - Nebraska has 92 hospitals and nearly two-thirds of them are what’s known as “critical access.”

They are rural, far from other medical facilities, and are struggling.

“When I talk with hospital CEOs who have been in the profession for 30-40 years, they say this is the worst financial situation they’ve seen,” said Jeremy Nordquist, president of the Nebraska Hospital Association.

As state lawmakers prepare to return to work this week in Lincoln, the Nebraska Hospital Association wants to make sure this crisis is on their radar.

While costs for labor, food and drugs are skyrocketing, Nebraska’s Medicaid provider rates grew by 2%. Most of Nebraska’s hospitals’ revenue comes from Medicare and Medicaid.

“If we don’t get rates that keep up with the cost of care, hospitals will start to look at services to eliminate,” said Nordquist. “We’ve already seen some of that. Hospitals that owned nursing homes in western Nebraska closed those nursing homes because the finances couldn’t work anymore. We saw a central Nebraska hospital recently close its in-patient behavioral health unit, something we need more of in this state, not less.”

The call to action is for tens of millions of dollars to keep hospital services intact. With a new governor set to take office on Thursday afternoon, it’s unclear what will specifically come out of the first budget for Jim Pillen.

He wants to dramatically change the “school aid” formula while providing property tax relief. Gov.-elect Pillen already negotiated a 22% pay raise for the Nebraska State Patrol.

Plans are already in motion to build a new prison for $270 million to help the nation’s most overcrowded prison system. And when the legislative session begins, there will be even more people with big requests during this inflationary period.

“Governor-elect Pillen has served on hospital boards before in Columbus and the Med Center,” Nordquist said. “We have a lot of lawmakers who care about rural healthcare. We’re optimistic they’re going to work with us and hear our concerns.”

The 108th Nebraska Legislature convenes on Wednesday.