New York Establishes Committee to Reform Nursing Home Certificate of Need Process

At its June 18, 2025, meeting, the PHHPC established an Ad Hoc Committee (Committee) to review and recommend reforms to the nursing home CON application process.

PHHPC oversees the state’s public health and healthcare delivery system. Its duties include adopting regulations, approving the establishment and transfer of ownership for healthcare facilities, home care agencies, and hospices, and advising the New York state commissioner of health on major projects and service changes.

Committee’s Purpose and Formation

The newly formed Committee is a direct response to PHHPC’s concerns about the state’s current CON review process, particularly in cases involving change of ownership (CHOW) conversions from not-for-profit to for-profit nursing home ownership. The Committee, which will be comprised of PHHPC members and with input from the New York State Department of Health and long-term care stakeholders, is tasked with a comprehensive evaluation of how CON applications are reviewed and approved. Its primary goal is to enhance transparency, accountability, and effectiveness throughout the CON review process.

Background and Need for Committee Oversight

In recent months, PHHPC’ s review of nursing home CON applications has revealed several challenges. For example, three CHOW applications were initially denied due to insufficient affirmative votes from Council members. These denials, followed by further discussion and the Committee’s formation, ultimately resulted in the applications’ approval after reconsideration—highlighting the need for a more consistent and transparent review process.

Committee’s Review Mandate

The Committee will examine the statutory criteria for CON approval as Public Health Law section 2801-A requires, including public need, financial feasibility, character and competence of operators, and other relevant considerations. The Committee’s review will pay special attention to recent legal requirements requiring a detailed assessment of nursing home applicants’ track records in facilities where they held controlling interests.

Several key issues have prompted the Committee’s formation, including concerns—expressed by some PHHPC members and external observers—about the impact of for-profit expansion on the quality of resident care, the sufficiency of current character and competence standards, and the possibility that some applicants may attempt to circumvent these standards through consulting arrangements or related party transactions. Additionally, there are doubts about the financial viability of smaller facilities under the current Medicaid rates and newly adopted staffing requirements, leading to delays and backlogs in application approvals.

Committee Goals and Areas of Focus

The Committee has been charged with reviewing and recommending improvements in the following areas:

• Strengthening character and competence standards for new nursing home operators, especially those with limited prior experience in New York;
• Implementing more rigorous financial review requirements, with a focus on long-term sustainability;
• Enhancing oversight of consulting agreements and related party transactions, to ensure operators retain direct control over facilities;
• Proposing new oversight mechanisms for approved applications, such as requiring external quality-of-care reviews with reports made to PHHPC; and
• Addressing any other issues the Committee identifies during its review.



Committee Process and Next Steps

PHHPC announced that the Committee will conduct its work remotely via webcast, soliciting input from stakeholders and the public to assist in its recommendations. Upon completion of its review, the Committee will present its findings and proposed reforms to the full PHHPC for consideration and approval.

Conclusion

By establishing this Committee, PHHPC has signaled its commitment to improving its oversight and ensuring the continued availability of high-quality nursing home care in New York. The Committee’s recommendations may bring greater clarity and consistency to the CON application process, benefiting applicants who have been frustrated at the slowness and lack of guidance in the current CON process.