Recent guidance from the Centers for Medicare & Medicaid Services (CMS), along with the passage of the 2025 Reconciliation Law (colloquially known as the “One Big Beautiful Bill Act” or OBBA), have led to several significant developments for nursing homes and long-term care facilities. In this post we discuss these developments and explore how they will impact the long-term care community.

Extension of Revalidation Deadline to January 1, 2026

CMS recently announced a third extension for skilled nursing facilities (SNFs) to submit required Medicare revalidations.  Facilities now have until January 1, 2026 to submit these filings, which, as we noted in previous blog posts (here and here), include onerous management and ownership disclosures.

CMS planned to begin gathering information related to “managing employees” and “additional disclosable parties,” as well as other information regarding interests held by private equity companies or REITs in October 2024 with the publication of the new Form CMS-855A. Under a final rule published in 2023, SNFs were to undergo off-cycle revalidation in 2024 in order to provide this new data requested by CMS.

But the deadline for that revalidation was delayed twice before this most recent extension to the beginning of 2026. This postponement may offer some regulatory relief to SNFs, who have spent extensive time and resources trying to meet the reporting requirements of this off-cycle revalidation.

Moratorium on Staffing Standards

In May of 2024, CMS finalized a rule that set the federal minimum staffing standards for Medicare and Medicaid certified long-term care facilities. These standards, which were implemented in phases starting June 21, 2024, required (among other mandates) that nursing homes ensure 24/7 registered nurse coverage and an overall minimum standard of total nurse staff hours per day. We covered this rule in a  previous Reed Smith In-Depth article.

 An April 2025 decision from the U.S. District Court for the Northern District of Texas and a June 2025 decision from the U.S. District Court for the Northern District of Iowa blocked the rule from taking effect. The Texas federal court vacated the rule in full, finding that CMS had exceeded its authority in promulgating it. Meanwhile, the Iowa federal court only vacated the 24/7 RN requirement and the minimum staffing hours requirement, while leaving the rest of the rule in place. Now, with the passage of the 2025 Reconciliation Law, the rule faces yet another massive blow.

The law, which was signed by President Trump on July 4, 2025, imposes a 10-year moratorium on the implementation and enforcement of the entire rule. As such, CMS will not be enforcing the staffing requirements until September 30, 2034. Meanwhile, the U.S. Department of Justice has appealed the Texas federal court’s decision striking down the entire rule to the U.S. Court of Appeals for the Fifth Circuit. No decision has yet been issued on an appeal of the Iowa federal court’s decision, which would have to be appealed to the U.S. Court of Appeals for the Eighth Circuit. But even if one or both of those decisions are eventually overturned on appeal, under the terms of the new law, CMS would still not be able to implement the rule until 2034.

Note that this pause in enforcement of the federal rule does not apply to similar state-specific staffing requirements; long-term care facilities must continue to meet any staffing or operational requirements established by the state in which the facility operates.

Changes to Nursing Home Care Compare and Five Star Quality Rating System

On June 18, 2025, CMS issued a Quality, Safety and Oversight memorandum, QSO-25-NH, which outlines updates to how nursing home ratings are calculated and reported on the Nursing Home Care Compare website.

According to the QSO memo, as of July 30, 2025, CMS will publish average Five Star ratings and other performance-based information for chains or affiliated entities on the Nursing Home Care Compare website. CMS will also be removing COVID-19 vaccination information from the main profile page of each nursing home effective as of the same date.

Additionally, CMS will be revising the methodology used to calculate Five Star ratings in the following ways:

• First, as of July 1, 2025, CMS will take into account only the two most recent standard surveys (instead of the past three standard surveys) in determining the health inspection rating calculation. In conjunction with this, CMS is also changing the weight given to each standard survey. This is expected to have a “meaningful” impact for approximately 20% of nursing homes who may have demonstrated either significant improvements or deterioration based on older performance. The updated methodology as described by CMS with this chart:

• Second, effective October 29, 2025, CMS will include additional claims data regarding use of antipsychotic medications in calculating a nursing home’s Five Star rating. The aim is to improve CMS’ accuracy in identifying and preventing improper administration of antipsychotic medications to residents.

Any changes to the ratings system or methodology on the Nursing Home Care Compare website is big news to long-term care facilities. CMS says that these changes will provide a more accurate impression of current conditions at facilities by dropping off old surveys that are in some cases more than 45 months old.

It has been an active couple of months in the nursing home and long-term care community, there is likely to be more change in the coming months as well, particularly with the final version of the Fiscal year 2026 Skilled Nursing Facility Prospective Payment System rule coming by the first week of August.

Reed Smith will continue to follow developments in the regulation of nursing homes and long-term care facilities.  If you have any questions on regulatory requirements for your organizations, please reach out to the authors of this post.