New York’s nursing home operators are urging state lawmakers to clarify how much of a proposed $1.5 billion health care funding increase will go to long-term care — warning that hospitals will continue to struggle with discharge delays if facilities remain underfunded.
Gov. Kathy Hochul’s executive budget for fiscal year 2026-27 sets aside the $1.5 billion for hospitals and nursing homes but does not spell out how the funds would be divided. The New York State Health Facilities Association (NYSHFA), which represents nursing homes and long-term care providers, is calling for half — roughly $750 million — to be directed to nursing homes, according to local coverage.
Advocates Seek Clear Share for Long-Term Care
Industry leaders argue that years of inadequate Medicaid reimbursement have left many facilities financially strained and unable to accept higher-acuity patients discharged from hospitals. That bottleneck contributes to ongoing discharge backlogs across the state’s 98,000 nursing home beds.
NYSHFA President Stephen Hanse has warned of a growing disconnect between hospitals under pressure to free up beds and nursing homes that say current payment rates fail to cover the cost of care.
The Hochul administration has framed the broader spending plan as a safeguard against looming federal cuts. In a budget statement, the administration said the proposal is designed to preserve health system stability amid reductions tied to H.R. 1. New York faces an estimated $3 billion loss in federal Medicaid funds under the law, according to a briefing from the advocacy group NYSenior.org.
Medicaid at the Center of Strategy
Beyond the $1.5 billion pool, the budget includes more than $1 billion in Medicaid payment increases for providers and an additional $750 million earmarked for hospitals and nursing homes. It also proposes a 1.7% targeted inflationary boost — about $3.92 million — for aging programs.
Legal analyses describe Medicaid as the state’s primary policy tool, not only for coverage but for workforce planning and cost containment. The budget outlines efforts to expand home- and community-based services, including the CAPABLE program, as part of New York’s Master Plan for Aging.
Still, for nursing home operators, one question remains: how much of the new funding will actually reach their facilities. Without clarity, they argue, broader health system reforms may prove difficult to implement.
