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Nursing Home Reimbursement Update

In a meeting with LeadingAge NY and other associations representing nursing homes, the Department of Health (DOH) announced their intent to address some long-standing Medicaid rate appeals. The initiative is under development, and details will be provided shortly in an upcoming webinar. The attestation-based process will be aimed at addressing appeals dating back to 2009. Other topics discussed at the meeting are outlined below.

Outstanding Payments

The 7.5 percent rate increase remains under review by the Centers for Medicare and Medicaid Services (CMS) with no prediction of an approval date. The provision is concurrently in executive review on the state level to help expedite release once federal approval is received. Associations again requested release of the state share of the funding, stressed upcoming union contract deadlines, and offered brainstorming assistance to overcome logistical barriers.

July 2023 Rates

July 2023 Medicaid rates that will update case mix based on assessments with reference dates spanning October 2022 through March 2023 are in executive review.

Intent to Freeze

DOH confirmed its intention to freeze the January 2024 Medicaid rate. The update to the Minimum Data Set (MDS) assessment instrument effective Oct. 1, 2023 will no longer provide the needed data to calculate case mix using Resource Utilization Group (RUG)-III categories. Once the Jan. 1, 2024 Medicaid rate is issued using MDS assessments from April through September 2023 to determine case mix, DOH will no longer have the data needed to update case mix. As a result, DOH intends to freeze the Jan. 1, 2024 operating rate pending the development of an alternative case mix methodology, which is expected to resemble the Patient-Driven Payment Model (PDPM) used in Medicare reimbursement.

Safe Staffing Funding

Release of the federal share of safe staffing funding to eligible facilities is pending CMS approval. The state share of the funding to hospital-based homes (i.e., those that file the Residential Health Care Facility (RHCF)-2 Medicaid cost report) is winding its way through state approvals and is expected to be assigned a Medicaid payment cycle shortly.


CMS has approved CINERGY funding for State Fiscal Year (SFY) 2022-23. The state share has been paid previously (Medicaid cycle 2277). Participating providers should see the federal share of this payment along with the state share of the 2023-24 payment in Medicaid cycle 2405, which has a scheduled release date of Oct. 11th.

Quality Penalty

DOH updated the quality penalty in the Medicaid rates retroactive to Jan. 1, 2022, effective with Medicaid payment cycle 2401, with a check release date of Sept. 13th. The associated Dear Administrator Letter (DAL) is available here. Note that this is a separate provision from the Nursing Home Quality Initiative (NHQI), which resulted in positive and negative Medicaid payment adjustments in payment cycle 2277 (March 29th release date). The quality penalty (retroactive to Jan. 1, 2022) was imposed on those homes who scored in the lowest NHQI quintile for 2021 AND ALSO were in the fourth or fifth NHQI quintile for 2020. The penalty reduces a provider’s Medicaid rate by 2 percent.


The Office of the Medicaid Inspector General (OMIG) has completed audits of the 2018 MDS assessments in most upstate areas and is currently completing work in NYC and on Long Island. The agency has issued 56 summation letters, with draft audit reports being mailed out in September.

40-70 Minimum Spending and State Staffing Levels Compliance

These initiatives are not under the purview of the Bureau of Long Term Care Reimbursement, so no updates were provided. DOH is planning to present a webinar on minimum spending compliance determinations in the near future and continues to work through the many requests for staffing penalty reductions.


At long last, CMS recently approved 2022-23 Intergovernmental Transfer (IGT) payments for public nursing homes. DOH is preparing letters and intends to issue the entire amount in a single payment. The final approved 2022-23 statewide amount is $184.9 million, notably higher than the $110 million amount of the previous year, but not as high as the amount suggested by the Upper Payment Limit (UPL) calculation that the State originally submitted.

Contact: Darius Kirstein, dkirstein@leadingageny.org, 518-867-8841