The Idaho Dept. of Health and Welfare has informed skilled nursing stakeholders that this year’s change to the Budget Adjustment Factor (BAF) will reduce SNF Medicaid reimbursement by 7 percent, a devastating blow to the sector following last year’s 3 percent cut on top of a 4 percent across the board Medicaid cut in Fiscal Year (FY) 2025, sector sources tell Park Place in an exclusive interview.

Idaho calculates what a facility's rate should be, then applies a BAF—essentially a haircut—to fit the state's budget. The BAF increased 37 percent in FY2026, meaning Idaho calculated the cost of care, then told providers: "We'll pay you 37 percent less than what we know it costs," the sector source said.

Combined with the 3 percent and 4 percent cuts and five years of frozen rates during 25 percent-plus healthcare inflation, the effective purchasing-power loss is approximately 15 percent or more for SNFs, according to SNF advocates in the state.

Over the last seven years average reimbursement for SNFs in Idaho has gone from the mid-$270/day level to approximately $229/day.

“This [Medicaid cuts] will lead to facility closures, lack of access, and negative care results for seniors across the state,” said Steve LaForte, principal, Cascadia Healthcare, the largest operator in the state. He said as it stands now, the cuts make operations non-sustainable for a number of operators, most pointedly in rural areas.

“Our understanding is at least four facilities representing over 300 licensed beds and several hundred current residents are triaging plans to close before the end of the year unless there is relief, which means lack of access and care and for those residents involuntarily moved from the shutdowns, movement trauma, and related issues including accelerated mortality,” LaForte said.

Data has shown that 25 percent of long-term care residents involuntarily moved die within six months of such a move on a non-actuarial basis, he added.

A History of Bad News

The projected cuts for this fiscal year are in addition to negative Medicaid reimbursement developments in years prior. Just in the past two years, the total in reductions by the state is 14 percent.

Advocacy campaigners Save Our Seniors Idaho said Idaho's Medicaid LTC budget was frozen by the legislature in 2018 — no inflation adjustments, no carve-out for nursing homes. That freeze, combined with the aforementioned 3 percent cut on July 1, 2025, and 4 percent cut on Sept. 1, 2025, represents more than a 12 percent nominal reduction since 2019 and a 30 percent real-terms erosion in purchasing power. CNA wages rose 35 percent, food costs rose 34 percent, property insurance rose 60 percent, and general Mountain West inflation reached 26.8 percent — all while the rate went down, they said.

“The federal One Big Beautiful Bill Act—signed July 4, 2025—adds $4.3 billion in federal Medicaid reductions for Idaho over the next decade and threatens to eliminate coverage for 40,000 Idahoans. Idaho already ranks 50th nationally among per-capita primary care providers. When LTC beds close, those seniors land in emergency rooms at 3–4× the cost to the state,” the advocates said.

What Do SNFs Do

LaForte said “as the largest operator in the state of Idaho, with our headquarters based in Idaho, we have a long-standing commitment to the state and enhancing quality care here.”

He noted that over 11 years, Cascadia has invested more than $100 million in infrastructure, created and/or saved over 2,500 jobs, and cared for tens of thousands of lives, while delivering some of the highest quality care in the country.

“The lack of collaborative support from our government partners for the seniors of Idaho, who are all their constituents, is highly disappointing and troubling for the future of senior care and access in Idaho,” LaForte said.

SNF advocates have also created a tracker comparing Idaho to the other states on Medicaid reimbursement. The Idaho Medicaid Crisis State-by-State SNF Rate Comparison shows some stark data for SNFs in Idaho.

While three states show their Medicaid reimbursement meeting the cost of care, with a payment-to-cost-ratio above 1.0 (Delaware, Hawaii, Oregon), Idaho’s payment-to-cost-ratio is at .55, according to the tracker.

Comments or questions? Contact Patrick Connole at pconnole@parkplacelive.com.