Emerging Legal Issues for Skilled Nursing Facilities in New York: A Year in Review

The regulatory environment for skilled nursing facilities (SNFs) is shifting rapidly, creating challenges and uncertainties for providers across the country—and especially those in New York. While the Trump administration has rolled back federal nurse staffing mandates, state-level requirements remain in full force, and new federal ownership disclosure rules are set to take effect in January 2026. Even as federal enforcement slows, state regulators appear primed to intensify oversight of nursing home operators by enhancing Certificate of Need (CON) review processes.

Understanding these competing regulatory currents will be essential for facility operators seeking to maintain compliance and avoid costly penalties in the year ahead.

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Trump Administration Repeals Federal Staffing Requirements (But State Standards Still Apply)

In early December, HHS repealed provisions of a Biden-era Final Rule that had imposed  national minimum nurse staffing requirements for nursing homes. The standards would have required staffing of 3.48 hours per resident day (HPRD)—with at least 0.55 HPRD of care from registered nurses (RNs) and 2.45 HPRD of care from nurse aides—and required a RN to always be onsite. In a press release announcing the rollback, the Trump Administration stated that the staffing requirements “disproportionately burdened rural and underserved communities already grappling with critical health care workforce shortages.”

Skilled nursing facilities should also take note that federal enforcement activities may be impacted by the closure of several regional branches of HHS’ Office of General Counsel, including those in New York. Prior to closure, these offices were charged with defending Centers for Medicare and Medicaid Services’ (CMS) compliance determinations and remedies imposed against non-compliant skilled nursing facilities in federal administrative proceedings and court actions.

Federal rollbacks aside, SNFs in New York will still need to navigate state staffing standards, which require every nursing home to maintain daily staffing hours equal to 3.5 HPRD by a certified nurse aide, licensed practical nurse, or RN. Of the 3.5 hours required, at least 2.2 HPRD must be provided by a certified nursing assistant (CNA) and at least 1.1 HPRD must be provided by a licensed nurse (see: NY Public Health Law § 2895-b; 10 NYCRR 415.13). Compliance with these requirements is determined on a quarterly basis using the most recent data available from the CMS Payroll Based Journal. Nursing homes that fail to adhere to the minimum staffing standards are subject to civil penalties, with the potential for DOH to impose a penalty of up to $2,000 per day for each day in a quarter that a facility fails to comply.

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Biden-Era Reporting Requirements Take Effect on Jan. 1, 2026

Even as the Trump Administration sets aside Biden-era staffing requirements, other regulations introduced by the latter administration will soon come into effect. As of January 1, 2026, all SNFs will be expected to submit ownership reports to CMS via a revised CMS-855A, which will disclose:

• • Each member of the facility’s governing body
  • Each person or entity who serves as an officer, director, member, partner, trustee, or managing employee of the facility
  • Each person or entity who is an additional disclosable party of the facility
  • The organizational structure of each additional disclosable party of the facility, along with a description of any relationships among disclosable parties and to the facility (see: 42 C.F.R. § 424.516(g).)

These disclosures will cover a wide breadth of individuals because the Medicare statute and CMS’s regulations define an “additional disclosable party” broadly.  It includes any person or entity that:

• • Exercises operational, financial, or managerial control over the facility or a part thereof; provides policies or procedures for any of the facility's operations; or provides financial or cash management services to the facility
  • Leases or subleases real property to the facility, or owns a whole or part interest equal to or exceeding 5 percent of the total value of such real property
  • Provides management or administrative services, management or clinical consulting services, or accounting or financial services to the facility (see: 42 C.F.R. § 424.502)

Facilities that fail to report can face denial, deactivation, or repeal of Medicare billing privileges (see: 42 C.F.R. §§ 424.530(a)(4), 424.540, 424.535(a)(4)). As the final rule was promulgated, the Biden Administration issued a press release (“Biden-Harris Administration Continues Unprecedented Efforts to Increase Transparency of Nursing Home Ownership”) stating its intent to “scrutinize ownership arrangements” given that studies have shown that “private equity ownership is associated with poor staffing conditions and resulting decreases in quality of care.”

Recently, the HHS Office of the Inspector General (OIG) issued a report recommending that CMS use ownership data to improve Special Focus Facility (SFF) compliance. Facilities are designated as SFFs if they consistently provide poor quality of care, periodically fixing deficiencies to pass one survey only to fail the next. OIG’s recent report concluded that CMS’s SFF program—which Congress established to address this yo-yo compliance—is “not working” because most nursing homes that graduate from the program do not retain the improvements made over the long term. OIG also found that a relatively small number of owners had a relatively high proportion of their nursing facilities in the SFF program and recommended that CMS use ownership information to identify patterns of ownership and discern root causes of recurrent noncompliance.

It remains to be seen whether the Trump Administration will continue to advance efforts to increasing nursing home scrutiny of private equity ownership despite relaxing staffing guidelines.  

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Upcoming: New York State Reviews the Certificate of Need Process

In June 2025, the Public Health and Health Planning Council (PHHPC)—a state board that regulates nursing home ownership transfers—launched an ad hoc committee to review the criteria and evaluation of applicants for nursing home operating licenses as well as recommend reforms to the nursing home Certificate of Need process. The committee was tasked with:

• • Adjusting standards for nursing home applicants to include character, competence, and standing in the community (especially for those with limited prior experience in New York)
  • Requiring more rigorous financial reviews
  • Enhancing oversight of consulting agreements and related party transactions
  • Proposing new oversight mechanisms for approved applications

The PHHPC initially rejected but later voted to approve three applications from for-profit operators seeking to take over county-owned or nonprofit facilities in the state. The PHHPC ultimately approved the applications despite finding that some of the potential operators had minimal experience owning nursing homes.

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Final Thoughts

In the past year, the regulatory landscape governing skilled nursing facilities has seen significant shifts, highlighting the importance of staying informed of emerging legal trends—from changing compliance requirements to heightened scrutiny around patient care and staffing standards. At Crowell and Moring, our veteran health care attorneys are prepared and available to help SNFs navigate these shifts in federal and state oversight and ensure ongoing compliance in the new year.

If you have any questions or would like additional information about this evolving regulatory landscape, please contact any of our authors.