Judge bangs his gavel
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A state Supreme Court judge last week dismissed the concerns of 130 New York nursing homes who argued that New York’s “70/40” spending requirement was not just unfair but also unconstitutional.

The 2021 law — which requires nursing homes spend a minimum of 70% of revenue on patient care and mandates that 40% of that portion be spent on staffing — drew ire from many providers. The 130 plaintiffs filed a suit in April 2023, claiming the rule is a regulatory overstep and unfairly singles out nursing homes in violation of equal protection clauses in both the state and US constitutions. 

Those claims were rejected in a decision issued Thursday by Associate Justice L. Michael Mackey of the New York Supreme Court, Appellate Division Third Judicial Department. 

Mackey ruled that some of the providers’ claims of unconstitutionality — such as that the state had imposed “excessive” fines — were unfounded. Other claims he ruled as “not ripe for determination,” meaning contingent on a prediction of future events that may or may not actually occur. 

Provider leaders in the state reacted with some disappointment — though they stressed patience, prior legislative wins and the importance of continued collaboration between providers and policymakers.

“We were unsuccessful at the trial court level,” conceded James Clyne, president and CEO of LeadingAge NY, which had filed lawsuits opposing both the state’s minimum staffing requirement and the 70/40 spending rule. “We preserved our right to appeal on both issues but are waiting to see what happens with a number of federal cases dealing with administrative rule making authority and the federal minimum staffing mandate.”

While the 130 plaintiffs lost their case this week, providers in the state already have been able to win some compromises on the 70/40 rule outside of court, added Stephen Hanse, president and CEO of the New York State Health Facilities Association. 

“The decision that came down we would disagree with, but we were fortunate in working in the construct of the existing law — with the legislature, with the governor’s office, with organized labor,” he told McKnight’s Long-Term Care News Friday.

Hanse referred to new provisions added to the law last year, which reduced fines and gave incentives to nursing homes that could show they were hiring more full-time workers than agency staff. The amendments also excluded the capital portion of the Medicaid rate from the 70/40 calculations.

“The law is still very burdensome, but this helps address some of our concerns while working toward addressing the workforce issues we’re dealing with,” Hanse said.

Hanse repeatedly stressed that the long-term care sector’s complex staffing and funding problems require a holistic and collaborative approach to solve — not just in New York but around the US.

“We have to work together,” he told McKnight’s. “That’s the principle way that we will be successful, and that shows in our efforts to amend the 70/40 law with all those parties working together in an effort to address some of the financial concerns we had … and some of the workforce issues.”