Legislature advances bills on medical costs, audits and campaign funds

By Fred Knapp , Senior Reporter/Producer Nebraska Public Media

April 2, 2026, 5 p.m. ·

Sen. Megan Hunt in debate Thursday. (Fred Knapp/Nebraska Public Media News)

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Medical costs, state spending audits, and candidates’ use of campaign funds would all be affected by proposals advanced in the Legislature on Thursday.

Federal legislation passed last year requires states to impose copays of up to $35 on Medicaid patients for doctor visits. Under legislation (LB929) sponsored by Sen. John Fredrickson, those copays could be paid by the managed care organizations, or MCOs, that administer those services, rather than the patients themselves.

Sen. John Fredrickson — John Fredrickson

Fredrickson said that would continue the current policy of the Department of Health and Human Services, while still complying with the law.

“We still will have co-pays and cost sharing as required by federal law. With this, we would just go back to what we previously did as a department, which was allow for MCOs to cover those costs, should they choose,” Fredrickson said.

Sen. Kathleen Kauth objected, saying co-pays ensure that patients have “skin in the game.”

“If we remove the skin in the game, are our costs going to go up? If people say, ‘Hey, I don't even have a copay, I can just show up at the doctor whenever I want.’ So I have real concerns with not expecting people to at least try to at least have some sort of payment that they are making for their own health and well-being,” Kauth said.

Other senators argued that if the managed care organizations shoulder the costs, that would increase the amount they charge the state. But Fredrickson argued it would be less expensive to treat people early, rather than paying for an emergency room visit later. Senators gave the bill first-round approval on a vote of 28-9.

Also Thursday, senators advanced a proposal (AM3075) that would require notifying the state auditor when the state enters into emergency no-bid contracts worth more than $50,000. Sen. Bob Andersen said that would enhance accountability.

“This adds another set of eyes to looking at the sole source contracting process, and ensures that the auditor is involved so he sees what is actually when there is an emergency, that the emergency is fully declared and that they are aware of the sole source contracting so that they can monitor how the funds are expended,” Andersen said.

Sen. John Cavanaugh, supporting the bill, said open bidding on contracts is preferable.

“The open contracting process is a cornerstone. It ensures that we are getting the best price, but it also ensures that there is no favoritism being exercised by the folks who have the ability to issue a contract,” he said.

Cavanaugh noted that Gov. Jim Pillen’s administration has come under scrutiny for awarding a $2.5 million no-bid contract to a consultant to secure economic development funds. Auditor Mike Foley has said staff members appear to have tried to mislead his office about the contract. Pillen has denied any wrongdoing, and Lincoln Police are investigating the matter.

Andersen’s proposal was amended into another bill (LB1048) and got second-round approval on a voice vote.

On another matter, senators considered a proposal by Sen. Megan Hunt to allow candidates and officeholders to use campaign funds for travel and child care for their children.

Senator Machaela Cavanaugh — Machaela Cavanaugh

Sen. Machaela Cavanaugh supported the proposal, saying it would make it easier for Nebraskans with young children to serve in public office. Cavanaugh referred to the fact that state senators are paid only $12,000 a year.

“There's not any financial incentive to doing this job at all. It's really a financial disincentive. But it would be nice if we did more things to help reduce barriers for younger Nebraskans to run for office,” she said.

Sen. Rita Sanders, chair of the Government, Military and Veterans Affairs Committee where Hunt’s proposal has been stuck, opposed the idea.

“Campaign funds should be used for campaign-related expenses. They should not be a conduit for donors to give money to candidates and office holders for their household expenses,” Sanders said.

Senators voted 20-18 against Hunt’s proposal. But they did give second-round approval on a voice vote to the underlying bill (LB986), which allows candidates to use campaign funds for security equipment and personnel.

Lawmakers also considered a proposal (LB966) by Cavanaugh that would allow any Nebraska student who qualifies for reduced-price school breakfasts and lunches to instead get them for free.

The proposal would eliminate the charge of 30 or 40 cents per meal. And it would raise the income limits to qualify for free meals from about $42,000 to $59,000 for a family of four.

The proposal would cost about $1.2 million a year. Cavanaugh said Speaker John Arch has said he will only schedule it again if she secures commitments to cover that cost from charitable donations, not state tax dollars. After she said that, lawmakers voted 32-7 in favor of first-round approval of the bill.

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Correction: The audio version of this story, and an earlier text version, misstated the income limit to qualify for free school meals. It is about $59,000 for a family of four.