Nebraska's Department of Health and Human Services (DHHS) has asked for about $922 million a year in developmental disability waiver aid for fiscal 2028 and 2029, slightly more than the $893.9 million budgeted for this year, while listing other cuts to reach an 8% reduction target.
Nebraska Public Media reported the figures Oct. 14 from the agency's 2027-29 biennial budget request to the State Budget Division. The current-year amount matches the state's own appropriations summary, which shows $893.9 million for Program 424, Developmental Disability Aid, in FY2026-27.
What DHHS put in its request
According to Nebraska Public Media:
- DD waiver aid: about $922 million a year in FY2028 and FY2029 for HCBS waivers under the Developmental Disabilities Aid Program, with the state expected to find about $32 million more over two years as its share.
- Beatrice State Developmental Center: appropriations down about $2 million a year. BSDC serves Nebraskans with developmental disabilities in an institutional setting.
- Provider rates: a 3% Medicaid reimbursement cut worth about $80 million over two years. The report described it as hitting hospitals and clinics and did not say whether DD waiver rates are included.
- Optional expansion services: nearly $200 million in state savings over two years by removing or reducing services such as prescription drugs, therapy, non-emergency transportation and dental coverage for Medicaid expansion adults.
- Federal Medicaid changes: $130 million in expected savings over two years from work requirements and six-month eligibility checks under the 2025 federal law.
- Staff and facilities: a 5% frontline staff reduction in three divisions (about $20 million over two years), $43 million in across-the-board operational cuts, closing the Whitehall youth psychiatric treatment facility and closing a 20-bed unit at the Lincoln Regional Center.
The totals
The State Budget Division's request summary shows DHHS's overall budget staying near flat:
| DHHS (all funds) | FY2026-27 base | FY2027-28 request | FY2028-29 request |
|---|---|---|---|
| Agency operations | $861.6M | $912.1M | $935.8M |
| State aid | $7.48B | $7.42B | $7.42B |
| Total | $8.338B | $8.332B | $8.351B |
Not final yet
The 8% options come from a budget-modification exercise the state requires of agencies, which asks them to show how they would operate at 92% of their base budget. Nebraska Public Media notes the state faces a projected shortfall of more than $1 billion over the current and next two fiscal years, and agencies have been running on a 5% cut to monthly allotments since July. The governor will choose which proposals to include in the budget sent to the Legislature in January.
Why this matters for providers and DSPs
DD waiver aid is one of the lines that grows in DHHS's request rather than one offered up as a cut, which matters for provider agencies and the direct support professionals they employ. But a request is not a budget. Lawmakers still have to close a gap of more than $1 billion, and the report leaves open whether the proposed 3% rate cut would reach waiver services. The same department froze enrollment of new DD waiver agencies on Oct. 1 (details), so Nebraska providers face tighter entry rules and an uncertain rate picture at once.