Medicaid cuts threaten ‘devastating blow’ to Idaho nursing homes, hospice care

Gary Connell’s senior assisted living center in Nampa will soon have a choice to consider: Should it stop accepting residents on Medicaid?

At Table Rock Senior Living at Park Place, the finances were already on thin ice. Most of its residents rely on the low-cost insurance subsidized by the federal and state governments. But Idaho often pays Table Rock less than half the amount it costs to provide those residents care, Connell told the Idaho Statesman. The state Department of Health and Welfare now plans to cut its reimbursement rates even further starting in September.

“It’s really going to cause a lot of havoc,” Connell said.

Connell said he hopes his facility can find a way to keep serving the elderly Medicaid population.

“They deserve to have the same comfort and care that anybody would receive in this phase of life,” he said. “That’s not something that should just be reserved for a select group of people. “

State officials last year predicted expenses based on data available at the time, but the need for services has spiked since then, AJ McWhorter, a spokesperson for Health and Welfare, told the Statesman by email. The department now anticipates more than double those costs, it told providers in a letter. In response, the department must take “immediate steps to stabilize the Medicaid budget,” it said.

Gov. Brad Little in August ordered nearly all state agencies to reduce their budgets for the 2026 fiscal year, which began in July, after Idaho lawmakers reduced income and property taxes by over 20%. The Governor’s Office said the state must also “make way” for the tax cuts in President Donald Trump’s “Big Beautiful Bill.”

Health and Welfare plans to drop reimbursement rates for providers by 4%. That will reduce general fund spending on Medicaid by nearly $40 million this fiscal year, McWhorter said.

“We appreciate the support from the Governor’s Office and the Division of Financial Management to take a proactive approach to address rising costs in Medicaid,” McWhorter told the Statesman by email.

Facilities that accept residents on Medicaid will have to make “really tough decisions,” said Marisa Crecelius, the deputy general counsel for The Pennant Group, an Eagle-based holding company that owns the Table Rock assisted living center. Some have already given Medicaid patients 30-day notices that they need to move out, said Ashley Pentzer, the chief marketing officer for a subsidiary of Pennant.

All kinds of providers that accept Medicaid patients will feel the effects, including nursing facilities and hospice care, according to Health and Welfare. As Idaho’s population ages, providers warn that facilities providing elderly care may take a particular hit.

The senior care industry was already strained after the COVID-19 pandemic, when about 30 assisted living facilities in the Treasure Valley shut their doors.

“I think our senior living community now is really feeling like these cuts potentially could be another devastating blow,” Pentzer said.

Patients seek to live final days ‘in dignity’

Liz Sonnichsen, another deputy counsel for Pennant, recalled watching her grandfather go through hospice care. His insurance permitted him to seek his care at home, which allowed Sonnichsen’s grandfather to die peacefully on his farm in Jerome, she told the Statesman.

She attributed his quality care to the availability of a range of care options, including home health nurses and hospice providers. But Medicaid cuts to all of those will leave people like her grandfather, especially in rural areas with few senior care facilities, with far fewer options close to home.

“With these cuts, it’s going to significantly impact that ability to live and end your life in dignity,” she said.

Connell said there are often misconceptions about who uses Medicaid. At his facility, many of the residents started off paying for assisted living care out of pocket, but wound up exhausting their savings before finding themselves on Medicaid.

“They’re teachers, and firefighters, and police officers, and small-business owners,” Connell said. His average resident is 85 years old, he said.

Retired for 20 or 30 years, those residents have “just exhausted all their resources,” he said. “At that point, there’s really no other option for them except Medicaid.”

Connell said evicting existing residents on Medicaid would be a last resort because of the effect it can have on their health. Even the fear of being displaced can cause depression, anxiety and loss of appetite, he said. It can exacerbate existing health conditions and, in extreme cases, lead to premature death, Connell warned.

“That’s what we want to avoid,” he said.

Cuts will drive up ER costs, providers warn

Pentzer said many workers who found themselves involved in end-of-life care are “called” to the work and often witnessed an elderly family member’s final days. During her time in the industry, she said she has seen how inaccessible quality care can be for many, and how often family caretakers exhaust all their options as a result.

Pentzer said she has regularly seen family members providing care for an elderly relative on Medicaid and waiting for months to bring them into a facility or get into appointments with specialists – only to burn out and drop the relative off at the emergency room.

Care at an ER costs significantly more. Medicaid reimburses up to $125 for a home-health visit from a skilled nurse, or about $200 per day of hospice care, Pentzer said, while a day in the hospital costs an average of about $3,000.

Hospitals cannot release patients without a safe discharge plan, so they must help the patient find placement at an assisted living facility or other home. Until then, the patient must remain at the hospital – and if they’re on Medicaid, those stays get billed to the state.

As Idaho cuts its Medicaid reimbursement rates for homes like these, fewer will continue to accept Medicaid patients, Pentzer predicted, leaving patients in hospitals for longer periods.

Senate Majority Leader Melissa Wintrow, a Boise Democrat serving on the Legislature’s Medicaid Review Panel, echoed those concerns.

“We’re going to see serious access issues now, and then, what’s going to happen? They’re going to go to the hospital emergency room,” she told the Statesman by phone. “We can’t refuse people at the hospital emergency room, and that’s a higher cost of care, which means the Legislature is going to take it on the chin in the end.”