The Minnesota House passed the Human Services budget proposal on Tuesday, which the House said is one of the largest investments in nursing homes in the state’s history.

The bill, authored by Rep. Mohamud Noor (DFL-Minneapolis) Noor, would invest more than $10 million into critical access nursing facilities, he said, adding that value-based reimbursement in nursing homes will have $853 million baked in over the next four years, according to a report in the Session Daily.

“The House DFL Human Services Budget makes historic investments in nursing homes, long-term care, and in Minnesota’s care workforce. Our budget invests more than $6 billion in nursing homes overall — $847 million more than the last two-year budget,” Speaker Melissa Hortman (DFL-Brooklyn Park) said in a press release, referring to Minnesota’s Democratic party affiliate – the Democratic Farmer Labor Party (DFL).Yet, local nursing home advocates failed to hail the funding.

Executives at Care Providers of Minnesota, which represents over 1,000 nonprofit and for-profit organizations providing services along the full spectrum of post-acute care and long-term services, said the legislation doesn’t actually include any “new money” for nursing homes in the state.

“When they say $6 billion, they’re essentially just adding up all the money in state and federal share for Medicaid that the state at the beginning of the legislative session assumed it was going to be spending,” Todd Bergstrom, Director of Research at Care Providers of Minnesota, told Skilled Nursing News, adding that the organization has submitted proposals for increased funding to the House that have been rejected.

“One of the things they’ve been talking about is that $850 million goes above and beyond what was being spent kind of presently,” he said. “And our general issue with that is that’s forecasted and Minnesota nursing home forecast has been wildly inaccurate and overstates and overestimates what the expenditures will be.”

Patti Cullen, CEO of Care Providers of Minnesota, told Skilled Nursing News in an email that she anticipates spending far less than what is forecasted and if additional appropriations aren’t ultimately included in final spending bills, the state will likely face additional closures.

Bergstrom said that since 2022, the state has had fifteen nursing home closures, and one announced closure pending.

Meanwhile, Cullen said that the industry’s costs for workforce recruitment and retention, along with pandemic related expenses and inflationary increases are resulting in spending rates that far exceed reimbursement rates in nursing homes.

“In addition, our payment system has a built-in lag between when we incur the expense and when we see those costs in our rates of up to two years,” she said.

Minnesota Republicans want more funding for nursing homes, saying it currently accounts for only about 0.01% of the total budget.

“We’ve had 15 nursing homes close over the last couple of years. We had two close just in the last couple of months,” Rep. Anne Neu Brindley (R-North Branch) said in a press conference, the Session Daily noted.

And although Neu Brindley proposed an amendment that would appropriate $230.97 million during the next four years for nursing facility grants, the Noor version cut it to $20 million to avoid defunding HIV/AIDS support services and direct care and treatment services.

Disputes between the state House and Senate bills will be settled by a conference committee.