LINCOLN — The Nebraska Legislature advanced a bill Wednesday that would finance a planning process for the deluge of senior citizens that will need government-funded assistance in their retirement years.
The 31-11 vote for first-round approval came after a lengthy debate about the need for spending $46 million in state and federal money on planning and whether the program represented an expansion of “big government” or a wise investment that would save money in the long run.
State Sen. Kate Bolz, the sponsor of Legislative Bill 690, rejected the big government argument, saying the bill would result in more Medicaid-eligible elderly being cared for at home instead of in more-expensive nursing facilities.
It costs about $2,100 a year to care for someone in their residence compared to $56,000 a year for nursing care, Bolz said.
“The goal of this is to save money in the long run,” the senator said.
The state's elderly population is projected to rise by 74 percent to more than 400,000 people over the age of 65 by the year 2030. Bolz and other senators said the state faces a fiscal crisis if it doesn't adopt more cost-effective ways of caring for the elderly.
But several senators questioned the financial cost of the bill and whether Nebraska would be saddled with increased costs after a two-year federal grant expires.
The fiscal note for LB 690 calls for the state to spend $8.6 million over the next two years to obtain about $37 million in federal matching funds.
The funds would be used to expand the capacity of in-home services offered to the elderly, such as transportation and respite care, and improve case management. The bill would also create an Aging Nebraskans Task Force to better plan for the increased elderly population.
The federal money comes from a program created by the Affordable Care Act that gives states incentive money to revamp their Medicaid system to offer more in-home services for the elderly. Currently, about 42 percent of the state's elderly population remain in their homes, but Bolz said the program's goal is to increase that to 50 percent or more.
The grant program runs out in September, so the senator and others said LB 690 needs to be passed now to obtain the 4-to-1 matching funds.
Omaha Sen. Heath Mello called LB 690 “the first honest conversation about entitlement reform.”
But other lawmakers, led by Papillion Sen. Bill Kintner, questioned how the $46 million would be spent and what it would accomplish, what strings were attached to the grant and whether or not the state could create its own aging task force.
“This is a textbook example of how to grow government,” Kintner said. He said it would translate into hiring more people, more regulations and increased state spending.
Bolz said that after the two-year grant runs out, the state may have increased cost for case management of perhaps $5.8 million a year. But, she said, other similar planning efforts have produced cost savings for the state and so would LB 690.
Omaha Sen. Steve Lathrop said the only time some lawmakers gripe about “the evils of bigger government” is when it pertains to the aged, sick or poor. No one, he said, rails against other federal spending, such as farm payments, federal matching funds for roads or the trillions spent on the wars in Iraq and Afghanistan.
The bill still faces two more rounds of debate and would need the signature of Gov. Dave Heineman, a foe of the Affordable Care Act, to become law. Backers of LB 690 plan to meet Friday to seek a reduction in the cost of the measure.