Bills would postpone, end health care fund transfer reductions

The Appropriations Committee heard testimony March 25 on two bills that would reduce or end scheduled reductions in transfers from the state’s Health Care Cash Fund.

LB4, introduced by Omaha Sen. Bob Krist, would postpone for two years the implementation date of reductions to fund transfers. Transfers from the Health Care Cash Fund are scheduled to be reduced by 5 percent annually through 2015.

As a result, the current $59 million transfer will be reduced to:
• $56.4 million in 2013;
• $53.2 million in 2014; and
• $50.2 million in 2015 and thereafter.

Krist said the reductions were meant to protect the corpus of the fund, but that reductions are not needed this biennium.

LB285, introduced by Lincoln Sen. Danielle Conrad, would eliminate the reductions entirely and maintain the transfer at $59 million annually.

Conrad said a pending $18 million distribution from the Nebraska Tobacco Settlement Fund would help ensure the Health Care Fund’s sustainability into the future without reductions in transfers.

Tom Murray, associate vice president for health science research at Creighton University, testified in support of both bills, saying he relocated to Nebraska in part because of access to research dollars from the Health Care Fund.

The fund is projected to have a higher balance in 20 years than it has today, he said, adding that the biomedical research the fund supports had a $3.5 million impact on the state’s economy in 2011.

“Research fuels Nebraska’s economy,” Murray said.

No opposition testimony was given and the committee took no immediate action on either bill.