Nebraska Medicine’s Childcare Support: Dependent Care FSA Match

Challenges

Worker Issues

Location

Nebraska

Stakeholders

Businesses, State Government

Beneficiaries

Parents

Overview

Nebraska Medicine, a leading healthcare system in Omaha, implemented a Flexible Spending Account match program to solve childcare challenges in its workforce.

Key Impact Metrics

65%
of employees with dependent children have enrolled in the program
$5K
max annual contributions
4
childcare services provided

Problem

The hospital system, like many others across the state and nation, faced a significant shortfall in its nursing and other healthcare positions, a problem that was exacerbated by the COVID-19 pandemic. This labor shortage was directly tied to challenges in recruitment and retention, with the hospital losing more employees than it could attract. A key factor in this struggle was the lack of affordable and accessible childcare.

Solution

The solution offered by Nebraska Medicine to address its workforce challenges was a comprehensive package of childcare benefits centered on financial support and resource navigation. The core components include a Dependent Care Flexible Spending Account (FSA) matching program that helps to alleviate the financial burden of childcare costs. This matching program complements the tax-advantaged nature of the FSA, which allows employees to pay for eligible expenses with pre-tax dollars, significantly increasing their savings. In addition to the financial support, Nebraska Medicine also partnered with Upwards, a national childcare network. This partnership gives employees access to a dedicated platform and a network of providers, with 24/7 care managers who help them find childcare that fits their specific needs, including weekend, nighttime, or backup care.

Results

Beneficiary Impact
$500,000 of employee funds were matched in the first year
Employee Impact
~7 % increase in retention rate among nurses with children
Financial Results
~$1,250 in tax savings due to $5,000 FSA contribution

Replication Tips

Leverage FSA infrastructure: If an employer already offers Dependent Care FSAs, adding a match is administratively straightforward. Work with your FSA administrator to handle the employer contribution.
Combine financial and logistical support: Financial incentives alone may not be enough. Pairing the match with a service like Upwards or a local childcare referral partnership maximizes effectiveness.