Federal Medicaid Updates
On July 4, 2025, President Trump signed the federal tax and spending bill (H.R. 1; the so-called “Big Beautiful Bill”) into law. While this bill includes significant impacts to Medicaid benefit programs in our state, Medicaid funding for skilled nursing facilities and assisted living are not directly impacted and will continue to be funded at the same federally matched percentage they are today. We commend our national partners, the Central WA Coalition and all of our members who helped share their stories to help defend Medicaid resources for long-term care during the debate in Congress.
After preliminary review of the new law, it appears that residents in assisted living and skilled nursing facilities who are receiving care and services through the Medicaid program will be unaffected. Long-term care providers will continue receiving payments as usual.
Here is the Kaiser Family Foundation briefing on the legislation. Specific impacts on health care, including Medicaid and Medicare, are found here.
State Medicaid Updates
Washington spends $21 billion on Medicaid annually, $13 billion of which is paid by the federal government. Kaiser Family Foundation estimates Washington will lose between $31 billion and $51 billion in federal Medicaid dollars over the next 10 years, or at least $3 billion
Here is a Washington State Standard article on potential fallout for Washington state. Real impacts to our state budget remain to be seen and depend on the governor and legislative response to the new law.
According to the Seattle Times, Governor Ferguson is considering calling the legislature in for a special session, but Senate Majority Leader Jamie Pedersen, D-Seattle, is optimistic a special session won’t be necessary.
During the 2025 legislative session, SNFs and AL were targeted on several “budget cuts” lists, and the state legislature spent significant time debating the importance of Medicaid rate rebases.
Fortunately, the legislature recognized the importance of maintaining current access levels to Medicaid by funding rebases on July 1, 2026, particularly in light of the growing aging population. We will continue to emphasize the importance of updating Medicaid rates to reflect 2024 costs.
The impacts related to changes in skilled nursing facility provider taxes remain to be seen. These taxes are a significant funding mechanism for SNFs and hospitals in our state. For SNFs the new law “freezes” provider taxes at the current level and there will be modifications to uniformity requirements that are yet to be detailed. WHCA will be keeping a close eye on the CMS development of related rules.
For Medicaid recipients between the ages of 19 and 64 who were part of the expansion population, new work requirements will go into effect putting eligibility at risk for some. This does not impact younger AL or SNF populations that are eligible under traditional Medicaid. Hospitals are receiving a reduction in provider taxes that help fund the medical system and are particularly important for rural hospitals. There are also some modifications to the Children’s Health Insurance Program (CHIP).
In general, when people lose health coverage, they are more likely to end up in the emergency room with either very acute conditions that have been left unattended or minor issues that could have been taken care of in a clinical setting. This drives up health care costs and bogs down access for everyone, not just for those who lose insurance.
Communicating with Residents & Families
Our members report that they are fielding questions and concerns from residents, patients, and families regarding the impact of HR 1’s passage on current Medicaid services. Here is a simple templated memo that can be used to help inform your community and others about the impact of HR 1:
SUBJECT: A Note on Recent News Regarding Medicaid Funding
We are honored to have the opportunity to serve as your [assisted living/skilled nursing facility]. You may have seen recent news regarding the passage of legislation by Congress reducing resources for Medicaid. Please know that the adoption of this legislation does not reduce Medicaid funding for vulnerable adults who are served by facilities like ours. That means that this legislation does not affect our resources or ability to serve you.
Don’t hesitate to email Lauri St. Ours with questions.