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Nursing Home Funding Is Falling Short

New York State 2025 Budget Update:

As of Thursday, March 14th both the Senate and Assembly formally rejected the Governor’s proposed cuts to long-term care in their one-house budget proposals. Instead, they have put forward substantial increases to Medicaid-funded long-term care programs. Each house has proposed a 3% across-the-board increase for all Department of Health Medicaid providers, including nursing homes. Additionally, the Senate proposes an extra 6.5% increase while the Assembly suggests an additional 7.5% for nursing homes. Notably, the Senate also included nursing home rebasing legislation in their budget bills. Lisa has sent a note to our local delegation to thank them for their support and hard work on one-house proposals.

Over the next few weeks, the Governor and the Legislature will negotiate to reconcile the differences in their respective budget proposals, aiming to reach a final agreement for the State Fiscal Year (SFY) 2024-25 Budget by April 1, 2024. Given the Easter holiday on March 31st and depending on the pace of three-way budget discussions, there is a possibility that budget negotiations may extend into the first week of April.

With approximately two weeks remaining of this year’s state budget work, we ask that you help us continue our advocacy efforts until the final state budget is announced! Please take a moment to send a digital letter to our governor’s office showing your support by clicking here.

Original post from 2/15:

New York is experiencing a nursing home funding gap that must be addressed this year. With Governor Hochul’s latest budget, Medicaid payments fall well short of care costs by $810 million annually.

In New York State, Medicaid pays for more than 75% of nursing home residents. Until last year, when a 7.5% increase was budgeted nursing homes went more than 15 years with no increases in the daily Medicaid. When factoring in an inflation rate of nearly 50%, the 7.5% increase is appreciated but a drop in the bucket compared to the rise in the cost to provide care. Nonetheless, Governor Hochul’s 2025 executive budget does not address this shortfall and presents additional cuts.

Fast Facts:

  • Medicaid pays for 75% of nursing home days.
  • The daily Medicaid rate pays for an average 70% of the actual cost.
  • In Upstate NY, the average shortfall between cost and payment is nearly $200 per day.
  • Medicaid reimbursement rates in NYS are among the worst in the nation.


  • Nursing homes are challenged to pay staff a salary equal to their value.
  • Lower pay rates create a recruitment challenge and non-health care industries (fast food restaurants) have become serious competition for direct care staff. fast food restaurants are able to pay equal or more.
  • Some nursing homes are being fined for not meeting minimum staffing mandates.
  • Nursing homes are taking beds-offline (downsizing) due to unmanageable costs creating a backup in hospitals and impeding access to care.
  • More than 14,518 nursing home beds have been taken offline and 11 have closed entirely since 2009 in New York State.

Watch this video by LeadingAge where they ask policymakers to fulfill their promise to older adults and fill the Medicaid gap.

Episcopal SeniorLife Communities, and many other nursing home providers are joining together in their call for legislators to vote against Governor Hochul’s proposed budget and to support a 16% Medicaid rate increase for nursing homes and asking for a process for ongoing rate increases that keep pace with inflation in the future.

Please help us in our efforts by sending the provided letter to our Governor, your State Senator, and your Assembly Member today by clicking this link Send A Digital Letter.

You can also help by engaging (sharing, liking) our social media posts. In addition, please create your own posts using the following hashtags: #NYHealthBudgetGap #nursing homeSOS #SupportOurSeniors.

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