Nebraska Spends $8.2M on Contractors as Medicaid Work Rules Kick In
A 64-year-old cancer patient in Omaha faces dropped coverage under new state rules, while internal data shows call center wait times doubling.
By Pedro Tanaka ·
Nebraska spent $8.2 million on private contractors to implement Medicaid work requirements that took effect on May 1, 2026. The state became the first to enforce these rules under the One Big Beautiful Bill Act, ahead of a deadline that applies to most other states in 2027. State officials said the rollout has been successful, with 86% of affected applicants meeting the requirement or qualifying for an exclusion.
Eli McCreary, 64, of Omaha, learned his coverage had lapsed when a call from CHI Health notified him that he was no longer insured. The hospital, part of the CommonSpirit Health system, told McCreary that it would cancel his appointments unless he paid out of pocket. McCreary had been diagnosed with kidney cancer in June 2026, just three months after being discharged from a substance use treatment program. He also suffers from diabetes and chronic obstructive pulmonary disease.
McCreary said a call center representative informed him that he was required to work to stay on Medicaid. "You're required to do work to stay on," McCreary said the representative told him. "And you haven't fulfilled your work requirement." McCreary canceled a CT scan and delayed a cancer-related appointment with a traveling physician, missing his window of opportunity for another month.
State data shows that average wait times at the Nebraska Department of Health and Human Services call center nearly doubled between May and July, rising from 13 minutes to 26 minutes. The agency received more than 101,000 calls in August, a 66% increase from May. Jeff Powell, a spokesperson for the department, said the rollout has been very successful. He noted that the state uses contracted staff when hiring state employees is uneconomical or impractical due to time constraints.
The $8.2 million in contractor costs covers two years and stems from Public Consulting Group and Covendis. Public Consulting Group, based in Boston, supplies staffing, while Covendis, based in Atlanta, provides information technology support. Senior consultant Latanya Michaux of Public Consulting Group praised the state's handling of the requirement. Sarah Maresh, program director at Nebraska Appleseed, called the spending amounts shocking, noting that large corporations are making money behind the scenes.
Attorneys and policy professionals said McCreary's substance use treatment and health conditions should have exempted him from the work requirement. The federal law outlines exemptions for individuals with serious medical conditions or substance use disorders. McCreary works as a driver for an asphalt services company until he could no longer perform the job. He said he hoped to work longer but now finds it difficult to navigate the system while ill.
The Congressional Budget Office estimated that the policy will lead to 5.3 million more people being uninsured in the United States by 2034. Nebraska has about 70,000 adult Medicaid recipients subject to these work requirements. They must prove they are working or participating in similar activity for 80 hours a month unless they qualify for an exemption. McCreary said he does not know if it is his fault for missing notices from the state.
