Ohio Medicaid estimated the total amount it will have to pay nursing homes will be more than $572 million for that two-year period, according to its request to the court last year asking the court to reconsider its decision, which was denied.
“[T]he Ohio General Assembly has not appropriated the more than $1 billion that would be needed to carry it into effect for the prior and current budget biennia,” according to the court filing from Ohio Medicaid, referring to the prior two years for which $572 million was underpaid and the funding needed for the current two-year time frame.
“Crucially, if the Judgment were to apply retroactively, then it would compel ODM (Ohio Department of Medicaid) to spend approximately $572 million more than the appropriations actually authorized by the Ohio General Assembly for the 2024–2025 biennium," the state’s court filing reads.
‘Working through logistics’
The plaintiffs — which were LeadingAge Ohio, the Ohio Health Care Association and the Academy for Senior Health Science — wanted the court to order Ohio Medicaid to calculate and pay provider incentive reimbursement rates as required by the current, but soon-to-be out of date, Ohio revised code in regard to quality incentive payment rates to nursing homes.
The Ohio Supreme Court granted this writ of mandamus, which is a court order that compels someone to perform a legal duty. It further denied requests from Ohio Medicaid to halt the enforcement of this writ of mandamus, to reconsider its decision in this case, and to dismiss this case “as moot.”
The state argued the plaintiffs’ claim should not be subject to a court ruling because the state fiscal year ended in June 2025, and all the funds for nursing homes were allocated. The court noted that while the funding cycle had ended, the formula remains in state law and is still used to determine reimbursements.
There’s not a clear timeline on when Ohio Medicaid needs to repay nursing homes for the difference in calculations. Ohio Medicaid said recently it remains committed to following the law.
“We’re currently working through logistics and will follow up with any update on a timeline,” a statement from the department reads.
The state appears to be waiting for the Ohio General Assembly to make a decision on where those funds should come from and any additional appropriations that would be needed, said Susan Wallace, president and CEO of LeadingAge Ohio.
“A sum of this amount, the settlement of this amount, would require additional appropriations,” Wallace said.
Future calculations to be based on Ohio Medicaid’s method
To prevent further underpayments to nursing homes, the Ohio General Assembly affirmed Ohio Medicaid’s method of calculating payments in lawmakers’ broad spending bill, House Bill 184, which was approved late last year. This means nursing homes will not get additional funding moving forward, but the court is still requiring the state to repay the amounts it underfunded in the past two years.
“Once that bill takes effect, which is 90 days after its signing, the accumulation of back payments will stop,” Wallace said. The bill goes into effect March 20, according to the state legislature.
“In Ohio, nursing facilities are paid by the Medicaid program much, much less than what it actually costs to deliver care,” Wallace said.
The last few years, nursing homes have been struggling to keep up with costs, she said.
“If these payments go through, they’ll have the opportunity to reinvest that in the operations, into staffing and other critical support,” Wallace said.
It’s unclear how much nursing homes in the region were underpaid for those two years.
Ohio has about 926 Medicaid-certified nursing homes providing care to about 66,000 individuals, according to the state. Medicaid pays for the care of about 65% of all Ohio nursing home residents. Nursing homes are paid through a daily payment rate for each day of care that a resident receives in a facility.
The cost for the entire Ohio Medicaid program as a whole was approximately $43.2 billion for state fiscal year 2025, which was $137.2 million under what the department had projected to spend, according to the state. Ohio Medicaid serves just under three million people.
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