181 nursing homes sue over alleged ‘unconstitutional’ budget veto by Gov. Youngkin

RICHMOND, Va. (WRIC) -- Nearly 200 nursing homes are suing Virginia Medicaid, which they claim is "illegally relying" on what it calls an "unconstitutional" veto by Gov. Glenn Youngkin that strips an increase in funding allocated by the General Assembly for facilities.

One hundred eighty-one nursing homes, which are members of the Virginia Health Care Association - Virginia Center for Assisted Living (VHCA-VCAL), have filed a legal petition against Virginia Medicaid, which they plan to bring before the Supreme Court of Virginia. This is the first step in the lawsuit process.

The association claimed that Virginia Medicaid did not comply with the increased nursing funding adopted by the General Assembly in February and that Virginia Medicaid is "relying on an attempted veto by Gov. Youngkin that did not follow the requirements of the Virginia Constitution."

"The official law of Virginia does not record or recognize this attempted veto," VHCA-VCAL said.

The General Assembly's budget included $10 million in state funding and $11.65 million in federal Medicaid funds, which would double with changed reimbursement rates over two years.

The association said it advocated for an increase in funding during the 2025 General Assembly session because of many nursing homes facing a funding gap between the cost of care and what Medicaid pays, "because the Medicaid base rate remains too low."

VHCA-VCAL argued that Virginia Medicaid has "no legal authority" to go against the funding change established by the General Assembly for nursing home reimbursement.

Since Virginia Medicaid has not changed its calculations using these changes, the association said nursing homes will receive smaller reimbursements from Virginia Medicaid than they would receive under those required by the General Assembly.

"This affects the ability of Virginia’s nursing homes to maintain staffing levels and provide quality care to their residents," VHCA-VCAL said.

In addition, the association said that Youngkin vetoed the portion of the budget bill requiring Virginia Medicaid to implement the funding change with a new methodology, but did not veto the specific funding increase the General Assembly included in the budget bill for it, which the association claimed cannot be done under previous rulings of the Supreme Court of Virginia.

The association said nursing homes that are VHCA-VCAL members run over 96% of Virginia's Medicaid nursing facility beds, and nearly seven in 10 people in nursing facilities rely on Medicaid for their care.

A VHCA-VCAL spokesperson said Virginia Medicaid was served with notice on Tuesday, Sept. 2, and the association plans to formally file the petition with the Supreme Court "by the end of the week."

Youngkin provided a statement to 8News in response to this legal action, citing a funding increase in previous budgets, and adding that he believes his veto to be within his powers set by the Virginia Constitution.

Nursing homes had already received significant rate increases in previous budgets, resulting in payments rising $1.3BM since 2020. The current biennial budget includes $81M total for value based nursing, specifically, yet quality was getting worse, not better. This new rate increase did not link these funds in any way to increases in quality. The Governor believes Virginians deserve better. And as the Governor has previously stated, he believes this veto is wholly consistent with his powers under the Virginia Constitution. Gov. Glenn Youngkin