COLUMBUS, Ohio — The Ohio Supreme Court ordered the state to pay nursing homes up to $1 billion. Four months later, the money still hasn’t arrived.

In September, the court unanimously settled a dispute over how Ohio calculates Medicaid payments meant to reward high-quality nursing homes. The justices agreed with providers that the state used the wrong formula and underpaid them by about $527 million in the 2024-2025 budget and a similar amount in the current one.

In November, the justices rejected Ohio’s request to reconsider that decision.

“The Court did not invite further discussion,” according to the Aging Services Institute. “It did not suggest a path forward. It ordered one.”

But as January draws to a close, those payments have not been made.

Nursing homes say the delay has created tax consequences tied to money they haven’t received.

“Many providers operating on an accrual tax basis are being advised by their accountants that they may have to recognize these unpaid funds as income,” Ohio Health Care Association CEO Scott Wiley said.

The Ohio Department of Medicaid and the chairs of the House and Senate finance committees did not respond to requests for comment about when the payments will be made.

The dispute, explained

Thousands of Ohioans rely on Medicaid to help pay for nursing home care. And for many nursing homes, the state is their biggest customer.

Ohio pays nursing homes a daily rate for each Medicaid resident, which is calculated in two parts. One covers the basic cost of care. The other is a quality incentive, which rewards facilities that meet higher performance standards.

Every few years, the state recalculates those rates to reflect rising costs. That process is known as rebasing, and it’s where the lawsuit began.

Under the state’s approach, imagine the base cost of care rose from $150 to $200. That’s a $50 increase. Ohio then applied a 60% quality incentive to that increase, meaning high-performing nursing homes received an extra $30 per patient.

Nursing homes said that calculation left out an important factor: patient complexity.

Facilities that care for sicker, more medically complex patients are paid more per day. For example, a nursing home might have been paid $300 per day under the old rates and $400 per day after rebasing.

Under that scenario, the increase was $100. And 60% of that would be $60, not $30.

By using the lower number, nursing homes argued, Ohio shortchanged facilities that care for the most medically complex residents. The Supreme Court agreed.

How much will Ohio owe?

In court filings, Ohio Medicaid said that the nursing homes’ interpretation would cost about $285.6 million more per year than lawmakers intended.

That’s where the roughly $1 billion figure comes from—it reflects underpayments across two budget periods.

But lawmakers changed the formula in November.

“The nursing homes are going to get what the court said they get,” Republican Rep. Brian Stewart, of Circleville, said at the time. “But that’s looking backward.”

Going forward, Ohio would use the method Medicaid argued for.

Ohio’s Department of Medicaid did not respond to a request for comment. But the legislative change could mean Ohio owes around $762 million, rather than $1 billion.

When will Ohio pay?

How much the state ultimately owes—and when nursing homes will see the money—depends on the Ohio Department of Medicaid, providers say.

Wiley said his group has repeatedly reached out to the department since the court’s ruling, offering to work with state officials on a plan to recalculate the rates and issue payments.

“To date, they have not provided any indication of when—or if—they intend to comply,” Wiley said.

He also said nursing homes should not be penalized for delays “that are fully within the state’s control.”

“We also sincerely hope state officials will not put themselves in a position of risking contempt by failing to comply,” Wiley said.

Gov. Mike DeWine, when asked about the situation, said he would take the tax implications into account but did not offer a timeline.

“We’re talking to members of the legislature. We will be dealing with this,” DeWine said. “We will, you know, follow the law.”