A nursing home hallway in Uniondale.

A nursing home hallway in Uniondale. Credit: Newsday/Jessica Rotkiewicz

A new state law setting minimum standards for staffing and capping profits at nursing homes has been suspended due to health care worker shortages, even as the nursing home industry sues to block the measure.

Gov. Kathy Hochul signed an order on New Year’s Eve putting off implementation of the new law until after Jan. 30 due to "severe understaffing in hospitals and other healthcare facilities" during the COVID-19 pandemic, the executive order states.

The law, which had been set to take effect Jan. 1, requires nursing homes to spend at least 70% of their revenue on direct patient care, including 40% on staffing.

Nursing homes "are encouraged to comply" with the law, Samantha Fuld, a spokeswoman for the state Department of Health, said in a statement. However, she said, "in light of the current staffing crisis … noncompliance will not be a violation of the Public Health Law."

The delay came shortly after industry groups and more than 200 nursing homes, including more than 30 on Long Island, filed a lawsuit in federal court in Albany last month, calling the new law unconstitutional.

In addition to the minimum staffing levels, the new law passed last year also requires nursing homes to turn over any profits greater than 5% to the state, to be used to bolster nursing home funding.

Elements of the new law "are an overreach and unnecessary and don’t do anything to effectuate better care," Michael Balboni, executive director of the Greater New York Health Care Facilities Association, a trade group that is among the plaintiffs, said in an interview. "We think there’s a better way."

If that measure had been in effect in 2019, New York nursing homes would have had to give $824 million to the state, the lawsuit states. One Long Beach nursing home, Park Avenue Extended Care Facility, would have had to give the state $6.1 million, according to court documents. A representative of the facility did not respond to a request for comment.

The new law aims to improve patient care by increasing staffing levels, which often fall short of what’s needed to keep patients safe, said Dennis Short, a senior policy analyst with a union that represents health care workers, 1199 SEIU.

The pandemic "really exposed the challenges that have existed well before COVID," Short said. "In some ways, the pandemic provided some opportunities for new legislation and new laws and regulations to try to get at some of the fundamental challenges in the industry."

Nursing homes receive much of their revenue from Medicaid and Medicare, and there should be standards for how much gets spent on patient care, Short said.

Speaking after Hochul's State of the State address on Wednesday, when she called for having the state pay $3,000 retention bonuses to health care workers and for increasing the industry's workforce by 20% over five years, Balboni said those measures would be a boon to nursing homes.

"The governor has recognized that this is a huge issue for hospitals, nursing homes and assisted living facilities," he said. "Her response is about investing in the workforce, which is exactly the right response."

With Yancey Roy

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