Critics say NJ budget protects bad nursing homes
Comptroller: Language overrides regulations
By: Scott Fallon
NorthJersey.com
USA Today Network - New Jersey
..... Buried in 374 pages of the state budget passed June 30 [2025] is a jargon-filled passage dealing with Medicaid payments to nursing homes hat seems wonkish and innocuous.
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But acting State Comptroller Kevin Walsh said the "last-minute" language will allow poorly performing nursing homes to continue operating in New Jersey without the threat of taxpayer money begin taken away form them.
..... the budget language overrides regulations published this year [2025] that permit those who manage Medicaid - health insurance for low-income residents - to stop payments to nursing homes hat have been cited for major deficiencies by inspectors or that receive one-star ratings in nine of the last 12 quarters.
..... The budget language instead guarantees that state government 'continues providing Medicaid funds to the nursing homes hat provide inadequate care to New Jersey's most vulnerable population," Walsh posted on social media on June 30 [2025] shortly before the budget was passed by the Senate and Assembly and signed into law by Governor Phil Murphy.
..... Spokesperson for Senate and Assembly Democrats on July 2 [2025] declined to comment on the language, why it was added or Walsh's criticism. Democrats control both chambers of the state Legislature, and the budget passed along party lines.
..... Andy Aronson, CEO of the Health Care Association of New Jersey, a trade group that lobbies on behalf of nursing homes, said withholding Medicaid funds would harm nursing home residents.
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"the comptroller is an unelected official who consistently operates outside of his legal authority to bully law-abiding New Jersey citizens," Aronson said in a statement. Withholding medicaid payments "would result in the closure of high-quality nursing homes and the sudden disparagement if hundreds if not thousands, of innocent nursing home residents.
..... Stopping Medicaid payments could be devastating to most New Jersey nursing homes. About 57% of the state's nursing home residents are covered by Medicaid, which is administered by the state and called NJ FamilyCare.
..... Walsh called the regulations issued earlier this year [2025] "common-sense reform designed to project public funds and nursing home residents. They were an initiative from the Department of Human Services and supported by the Long-Term Care Ombudsman, AARP and Walsh's office.
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"It's definitely a setback, but it doesn't change OSC's mandate," Walsh, in a statement to NorthJersey.com on July 2, [2025] said of the budget language. "We will continue doing our work to protect Medicaid integrity and hold bad actors accountable."
..... The issue comes as new Jersey is expected to be hit with significant Medicaid cuts under the spending bill championed by President Donald Trump that keeps tax breaks in effect.
..... It also follows a report issued by New Jersey AARP last month [06/2025] that said owners of nursing homes paid $2 billion in taxpayer money to companies in which estate enterprises, food operations and staffing. This announced to $285 million more than outlined in federal guidelines.
..... Despite the move in the budget by the Legislature, a Senate health panel last month [06/2025] approved a bill that would take away Medicaid payments form poorly performing nursing homes. Facilities won one-star ratings in two consecutive quarters would be subject to several penalties form the state Health Department, including barring admission to new Medicaid residents, limiting the number of Medicaid, enrollees and reducing payments under a quality incentive program.