Governor Hochul’s Budget Must Address Nursing Home Crisis

Contact: Erin Foster, 585-474-0258
[email protected]


New York State Among Worst in Country for Medicaid Nursing Home Funding
It’s Time to Stand Up for Older Adults – They Deserve Better


 Rochester, NY, February 15, 2024 – Governor Hochul is proposing massive cuts to Medicaid funding for nursing homes in the 2024-2025 budget that includes $500 million in cuts to nursing homes, freezing the Medicaid operating rate, and an additional $400 million in unidentified cuts to nursing home reimbursement rates. The potential consequences are severe. There is currently a state funding gap of $810 million that directly impacts 97,000 nursing home residents statewide.

Of those 97,000 New Yorkers, more than 70% rely on Medicaid to pay for their care.  Five nursing homes in the Upstate NY area, representing 33% of nursing home residents in Monroe County, are working together as the Alliance for Senior Care in Rochester, urgently appealing to the Governor to address this crisis. According to a recent report,  more than 1,000 nursing homes have closed since 2015 across the nation. Workforce levels are at their lowest since 1994, and 55% of nursing home providers say they are operating at a loss. This has an immediate and tragic impact on residents.

Nursing homes in New York State serve a critical role within the healthcare system. New York has the fourth largest population of people over the age of 60 in the US. Nursing homes are crushed under the stresses of depleted resources, rising costs, and unprecedented staffing shortages. Despite a 40% increase in labor costs and a workforce shortage of 65,000 people, nursing homes have not seen a Medicaid reimbursement increase in 15 years. The current reimbursement rate covers only 50-60% of actual costs, creating a substantial financial burden on the industry. Nursing homes are destined for disaster under the current funding model.

According to the federal Medicaid and CHIP Payment and Access Commission, the shortfall between New York’s nursing home Medicaid rate and costs is among the worst in the nation. Medicaid rates for nursing home care in New York State are based on 2007 costs.

Additionally, since 2019, a reduction of 5,600 nursing home beds has posed challenges for those seeking quality care close to home, an important consideration for families and loved ones. The Alliance says failing to meet annual costs, NY’s Medicaid program adversely affects access to quality care. Inadequate Medicaid rates make it impossible for nursing homes to recruit and retain staff, resulting in a closure of beds and waiting lists that are forcing older adults to seek care far away from their loved ones. The Alliance is urging NYS residents to send STAND UP to the Governor telling her that NY’s older adults deserve better, and to send a digital letter to the Governor.


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