LINCOLN, Neb. (AP) — Nebraska lawmakers gave final approval Tuesday to a bill that imposes new regulations on behavioral health contractors, managed care organizations and Medicaid auditing practices.
Senators voted 48-1 to pass LB380, introduced by Sen. John Fredrickson of Omaha. The measure directs the state Department of Health and Human Services to tighten oversight of behavioral health services and enforce stricter rules on contractors working through the state’s managed care organizations.
Under the bill, the DHHS Division of Medicaid and Long-Term Care must define what constitutes network adequacy and ensure contractor compliance with federal and state mental health and substance use disorder coverage requirements.
The legislation also mandates:
- Public access to contractor surveys, financial analyses, audits and parity reports.
- Regulation of mental health and substance use disorder provider access, including network and rate adequacy.
- A monthly electronic communication system for Medicaid providers, including notice of any managed care contract changes.
- Annual publication of the criteria used to assess the adequacy of managed care organization networks.
Managed care organizations will face several new restrictions under LB380. They are:
- Barred from imposing stricter limits on mental health and substance use disorder services than on other medical conditions.
- Required to maintain sufficient provider networks for behavioral health services.
- Required to apply recognized standards of care and publicly disclose utilization review policies.
- Prohibited from retroactively denying authorization for mental health or substance use disorder services once provided.
LB380 also incorporates provisions from LB381, another measure by Fredrickson aimed at increasing transparency and oversight of Medicaid audits.
Those provisions require audit contractors to provide clear reasons for initiating an audit and establish an appeals process. Overpayment recoveries cannot begin until appeals are resolved—except in cases involving credible fraud allegations. Claim reviews will be limited to within three years of payment, and document requests must be relevant and proportional to the services under audit.
The bill includes language from LB610, introduced by Sen. Eliot Bostar of Lincoln, allowing DHHS to seek federal approval for the Ground Emergency Medical Transport Act. The department would be authorized to distribute supplemental Medicaid reimbursements to providers for ground emergency medical transport services, not exceeding the federal financial participation received from submitted claims.