Unpacking claims nursing homes say they will 'close their doors' if GOP passes budget bill

Yahoo

03-07-2025

A June 2025 survey by the American Health Care Association (AHCA) found that 27% of nursing home providers said they would have to close facilities if Medicaid funding was reduced in the 2025 congressional budget bill One Big Beautiful Bill Act.
However, the survey represented responses from 363 nursing home providers about hypothetical actions they would take, not confirmed closure plans.
The survey was conducted by a trade association representing nursing home interests, to highlight industry concerns about proposed federal Medicaid cuts.
House Republicans have proposed approximately $880 billion in Medicaid cuts over the next decade in the bill, while the Senate passed its own version with a projected $930 billion Medicaid reductions.
In late June 2025, after U.S. House Republicans passed (archived) budget legislation proposing cuts to Medicaid, social media posts spread claiming that many nursing homes would be forced to close if the legislation advanced.
For example, on June 28, U.S. Sen. Elizabeth Warren, D‑Mass., wrote (archived) on Facebook: " BREAKING: 1 in 4 nursing homes say they will be forced to close if Republicans pass Trump's Big Beautiful Bill. No grandma should be kicked out of her nursing home so that Mark Zuckerberg can buy another Hawaiian island."
(Sen. Elizabath Warren/Facebook)
The post had received more than 140,000 reactions and 8,200 shares as of this writing.
Similar claims appeared on Facebook (archived) from Social Security Works, an American political advocacy group that calls for expansion of Social Security, as well as on X (archived) from Jesse Ferguson, former deputy press secretary for Hillary Clinton's 2016 campaign.
The posts referenced survey data from the American Health Care Association (AHCA), a nursing home industry trade group. According to the organization's June 2025 "Provider Insights: Medicaid" survey of 363 nursing home providers, 27% indicated they would "close facility(ies)" if the federal government reduced Medicaid funding under the bill.
The survey asked: "If the federal government reduces Medicaid funding, what changes would your facility(ies) have to make?" Respondents could select multiple options. Beyond the 27% who said they would close facilities, 55% said they would reduce their Medicaid census (lowering the number or percentage of residents whose care is paid for by Medicaid), 58% said they would reduce current staff, and 77% said they would defer modernization efforts.
Snopes attempted to contact AHCA for additional details about the survey methodology and respondent characteristics. We have not yet received a response as of publication.
The AHCA survey provides context for why nursing home operators have expressed concern about potential Medicaid cuts. According to the survey, 80% of nursing homes were operating at a loss or with narrow profit margins of 3% or less. Specifically, 30% reported operating at a loss, while 50% reported operating with total margins between 0-3%.
Medicaid serves as the primary revenue source for nursing homes, accounting for 59% of their income on average, according to the survey. However, 62% of providers report that Medicaid reimburses less than 80% of their actual costs of care, with 24% saying Medicaid covers less than 60% of costs.
The survey found that 79% of nursing home providers were "extremely concerned" about potential Medicaid reductions, with an additional 13% "moderately concerned."
Meanwhile, a June 2025 analysis by Brown University School of Public Health researchers Vincent Mor and Fangli Geng commissioned by Senate Democrats identified 579 nursing homes nationwide at high risk for closure. According to the study, these facilities represent approximately 4% of all U.S. nursing homes and met three criteria: over 85% of patients on Medicaid, occupancy rates below 80%, and quality ratings of 1-2 stars on the Centers for Medicare & Medicaid Services (CMS) Five-Star Quality Rating System. The facilities were distributed across 45 states, with Illinois having 93 high-risk facilities, Texas 66, Ohio 41, Missouri 39, and Georgia 37.
Regarding potential impacts of Medicaid cuts, the researchers wrote:
It is difficult to say for sure, but a payment freeze lasting more than a year could nearly double the closure rate. People tend to enter nursing homes that are close to their homes or near where their families live, so closures often result in greater travel for residents and their families. In many communities, nursing homes are a major employer of low-skilled workers, particularly in rural and exurban areas. When they close, those in the community have to look further afield for employment, and in rural areas, discharged workers may need to relocate.
The Brown analysis focused on facilities currently meeting specific risk indicators, while the AHCA survey asked nursing home operators about their anticipated responses to hypothetical funding reductions. The researchers noted that facilities with high Medicaid populations would be "differentially adversely affected" by payment freezes since they have limited non-Medicaid revenue sources.
On May 22, 2025, House Republicans passed the One Big Beautiful Bill Act, a budget reconciliation package that includes major changes to Medicaid. According to the Congressional Budget Office, baseline federal Medicaid outlays were projected to total $8.2 trillion over the next 10 years. Independent analyses, including those by the Kaiser Family Foundation (archived) and State Health and Value Strategies, estimated that the House legislation would reduce Medicaid spending by approximately $880 billion over that period.
The Senate approved its version, with deeper projected reductions of around $930 billion, on July 1, 2025.
As of this writing, the legislation was back in the House, which must decide whether to adopt the Senate-passed version or negotiate a final bill through a conference committee.
American Health Care Association. "Provider Insights: Medicaid." June 2025. https://www.ahcancal.org/News-and-Communications/Documents/AHCA-2025-Provider-Insights-Report-Medicaid.pdf. Accessed 1 July 2025.
Congressional Budget Office. "Re: Mandatory Spending Under the Jurisdiction of the House Committee on Energy and Commerce." 5 Mar. 2025. https://www.cbo.gov/system/files/2025-03/61235-Boyle-Pallone.pdf?utm_source=80m.beehiiv.com&utm_medium=referral&utm_campaign=budget-reconciliation-update-senate-and-house-republicans-set-to-kick-the-can-on-medicaid-spending-cuts. Accessed 1 July 2025.
House Budget Committee. "What They Are Saying: President Trump Congratulates House Republicans on Passage of the One Big Beautiful Bill Act." 27 May 2025. https://budget.house.gov/press-release/what-they-are-saying-president-trump-congratulates-house-republicans-on-passage-of-the-one-big-beautiful-bill-act. Accessed 1 July 2025.
Burns, Alice. "The Math is Conclusive: Major Medicaid Cuts Are the Only Way to Meet House Budget Resolution Requirements." Kaiser Family Foundation. 7 Mar. 2025 https://www.kff.org/quick-take/the-math-is-conclusive-major-medicaid-cuts-are-the-only-way-to-meet-house-budget-resolution-requirements/. Accessed 1 July 2025.
Mor, Vincent and Fangli Geng. "Response to Senate Finance Nursing Home Request." Brown University School of Public Health. 23 June 2025. https://www.finance.senate.gov/imo/media/doc/response_to_senate_finance_nursing_home_request_1.pdf. Accessed 1 July 2025.
State Health and Value Strategies. "Medicaid Provisions in the House Budget Reconciliation Bill." 22 May, 2025. https://shvs.org/wp-content/uploads/2025/05/SHVS_Medicaid-Provisions-in-the-House-Budget-Reconciliation-Bill_5.22.2025.pdf. Accessed 1 July 2025.
U.S. Congress. "H. Con. Res. 14 - Establishing the congressional budget for the United States Government for fiscal year 2025 and setting forth the appropriate budgetary levels for fiscal years 2026 through 2034." 119th Congress. https://www.congress.gov/bill/119th-congress/house-concurrent-resolution/14/text. Accessed 1 July 2025.
U.S. Senate Committee on Finance. "Wyden Statement on New CBO Numbers Showing More Than $930 Billion in Medicaid Cuts in New Senate Draft." 28 June, 2025. https://www.finance.senate.gov/ranking-members-news/wyden-statement-on-new-cbo-numbers-showing-more-than-930-billion-in-medicaid-cuts-in-new-senate-draft. Accessed 1 July 2025.