Non-profit nursing homes in New York are urging state officials to back a boost in state aid for the facilities in the upcoming state budget as costs continue to soar. 

Nursing homes have seen a steady rise in operating costs over the last several years, spiking by 42%, industry groups this week said. Meanwhile, Medicaid rates for nursing homes have not changed in 15 years. 

Gov. Kathy Hochul is being urged to include a 20% increase in the Medicaid rate for nursing homes, which organizations that represent nursing homes argue would be an initial step toward financial breathing room for the facilities. 

"While it will not make providers whole, a meaningful investment in the nursing home Medicaid rate is critical to ensuring that homes can raise wages, hire more staff, re-open beds, provide high-quality care and stabilize the larger health care delivery system”, says Jim Clyne, the CEO of LeadingAge New York, a group that represents non-profit nursing homes in the state. 

The appeal comes as Hochul is preparing her State of the State address next week and budget presentation in the coming weeks.

Health care providers overall have struggled financially in the wake of the COVID pandemic, with upstate providers also pushing for more state assistance amid a staffing crisis that has led to higher costs. Providers have also called for more help to retain and recruit nurses and other medical staff within New York. 

In nursing homes, 75% of residents depend on Medicaid to pay for their care and a pronounced staffing shortage in the facilities has led to ongoing struggles, nursing home leaders said. 

“Already, we are restricting admissions and temporarily closing beds, because we just can’t compete for staff and provide good care with this chronic underfunding,” said Stuart Almer, the president and CEO of the not-for-profit Gurwin Healthcare System, which operates two nursing homes totaling 580 beds on Long Island. “Closures of good, mission-driven facilities are already happening; there will surely be more without some immediate relief.”

At some facilities in New York like the Weinberg Campus, the current Medicaid reimbursement rate is $100 per day less than the cost of caring for residents, creating a multi-million dollar shortfall. 

"This failed Medicaid reimbursement system has already resulted in a significant number of nursing home beds being taken offline across the state - creating a crisis for the entire health care system," said Bob Mayer, president and CEO of the Getzville-based Weinberg Campus. "Over the past several months I have received numerous calls from desperate family members trying to find nursing home placement for their loved ones. The people that we serve, and our dedicated staff deserve better.”