In the wake of studies showing that cost-cutting by nursing homes contributed to high COVID death rates at New York’s nursing homes, the state legislature enacted a law that set minimum staffing levels, required minimum spending levels on resident care, and capped profits. Though enacted in 2021, implementation was delayed for several years, and the legislature amended the law in response to industry lobbying.
All the while, industry groups had filed multiple lawsuits in both state and federal court. In the past 2 weeks, both courts rejected those challenges. A federal district court dismissed claims that the law constituted an unconstitutional taking, was preempted by federal regulations, violated the excessive fines clause of the Eighth Amendment, violated due process and equal protection rights, was preempted by the NLRA, and violated the Medicaid Act. A state trial court also dismissed in its entirety a case raising some of the same arguments, as well as state law claims. The plaintiffs in the state court case have already stated they intend to appeal.