Minnesota Gov. Tim Walz’s (D) proposed 2026-2027 biennial budget has sparked sharp criticism from long-term care operators, who describe it as a “short-sighted slap in the face” that could severely impact access to senior care services across the state.
The proposal, unveiled Thursday, includes a $200 million cut to nursing home funding, leaving operators bracing for financial challenges that could lead to reduced services and facility closures. Ben Hansen, director of communications at LeadingAge Minnesota, warned that the cuts would create a minimum 2% gap between providers’ expenses and state reimbursements.
“The governor’s proposal to cut $200 million from the nursing home payment will exacerbate a broken system and likely accelerate closures and decreased access throughout the state,” Hansen said. “The combination of the rate increase cap and the other nursing home funding cuts in the budget means that many facilities would actually see a rate decline in 2026, just as demand for services continues to rise.”
The proposed cuts come as Minnesota’s aging population places increasing strain on the long-term care sector. Researchers at Minnesota Compass report that nearly 18% of the state’s population is over the age of 65, a number expected to grow significantly in the coming years. A 2023 survey by the Long-Term Care Coalition found that 77% of Minnesotans believe the state is unprepared for the aging boom.
Providers are already grappling with financial instability. A critical access nursing facility program that has provided essential funding is set to expire in June, leaving rural facilities in particular scrambling to secure capital to maintain operations. Hansen argued that the proposed budget would compound these issues, potentially leading to an affordability crisis for seniors and families.
“Cutting services or hiking up fees is the opposite of what is helpful to seniors and families,” Hansen said. “Rather than finding solutions to improve access, the governor is proposing to balance the budget on the backs of the elderly, people with disabilities, and low-income Minnesotans.”
Advocates remain hopeful that bipartisan support for senior care will lead to the rejection of the budget cuts.
“We know that Minnesota lawmakers have a long history of supporting long-term care on a bipartisan basis, so we remain optimistic that the Legislature will reject the Walz budget and instead invest in aging services,” Hansen added.
With nearly one in five Minnesotans over the age of 65 and demand for senior care services climbing, providers and advocates emphasize the urgent need for a sustainable funding plan. As the legislative process unfolds, the future of long-term care access in Minnesota hangs in the balance.