Elder Law Legal Alert: New York DOH Issues – and Rescinds – Medicaid Guidance for Undocumented Individuals Aged 65+ in Nursing Homes

By: Dana Walsh Sivak

On September 3, 2026, the New York State Department of Health rescinded a directive issued just two weeks earlier that would have effectively ended Medicaid coverage for many undocumented individuals aged 65 and older receiving nursing home care. The original directive, DAL #26-13, had created significant uncertainty for health care facilities and families across the state relying on Medicaid for these individuals. The rescission, DAL #26-14, restores the status quo — for now. Here is what you should know about this short-lived policy change, and what to watch for going forward.

Background: Medicaid Coverage for Undocumented Individuals in New York

It has long been the policy of the federal government to withhold federal funding for Medicaid coverage to individuals who are not U.S. citizens, or who do not fall into certain categories of immigrants who would otherwise qualify for Medicaid. An exception to this policy is emergency Medicaid coverage for hospital treatment, which remains permissible under federal rules.

In New York, however, guidance issued in recent years allowed individuals aged 65 or older who require long-term care — or other forms of medical care not covered by the emergency Medicaid exception — to receive full Medicaid coverage. Importantly, these benefits are funded entirely by the State of New York, rather than supported by the usual funding split between the state and federal governments.

This policy has had a meaningful impact on New York families and health care facilities alike. For families caring for elderly loved ones benefiting from this policy — for example, where a relative fell ill while visiting an adult child in New York from outside the country, and overstayed a visa due to an inability to return home — this meant that New Yorkers could access Medicaid to provide for their loved one's care needs. For health care facilities, the availability of Medicaid for these individuals provided a payment source for necessary rehabilitation or long-term care, and enabled safe discharges for patients occupying hospital beds without a continued medical need for emergency care.

August 20, 2026: DOH Issues Unexpected Policy Change

Although previously announced, sweeping changes to Medicaid coverage for undocumented individuals have long been anticipated to take effect over the next year, until recently, there was no indication that New York's existing policy for individuals aged 65 and older would be affected.

On August 20, 2026, however, the Department of Health issued a "Dear Administrator Letter" (DAL #26-13, "Nursing Home Coverage for Undocumented Consumers Aged 65 and Older") that conveyed a significant change to the existing policy. The directive stated that individuals aged 65 and older would need to be disenrolled from their existing Medicaid Managed Care plans within a short period following permanent placement at a nursing home. Thereafter, unless they fell into an acceptable immigration category entitling them to institutional Medicaid coverage, these individuals would not be eligible for Medicaid benefits to cover nursing home care.

This abrupt policy change raised immediate concerns among health care facilities and practitioners. Although news of this update was only just beginning to reach individuals and facility administrators who may be impacted by this directive, there was a great deal of uncertainty about what the directive would mean for undocumented residents currently in nursing homes or those in other immigration categories that might render them ineligible. The change also created significant uncertainty for hospital patients in need of rehabilitation, as the new policy would leave them without a payment source for the care they require in order to be discharged.

September 3, 2026: DOH Rescinds the August 20 Directive

In an unexpected about-face, on September 3, 2026, the Department of Health issued new guidance rescinding the August 20 directive. The latest guidance, DAL #26-14, available on the DOH website, states:

"The Dear Administrator Letter (DAL), #26-13, Nursing Home Coverage for Undocumented Consumers Aged 65 and Older, issued on August 20, 2026, is rescinded immediately. Please disregard the DAL until further notice."

The updated guidance directs any questions regarding eligibility for impacted individuals to the Medicaid portal at MCfor65PlusUndoc@health.ny.gov.

What Comes Next

It is not yet clear whether the Department of Health will issue further guidance regarding this category of individuals. The issuance and immediate rescission of DAL #26-13 has generated considerable uncertainty, and the situation remains fluid.

What This Means for Impacted New Yorkers

• Current coverage remains in place. With the rescission of DAL #26-13, the existing policy allowing Medicaid coverage for undocumented individuals aged 65 and older in need of nursing home care is restored — for now.
• Further changes are possible. The Department of Health may issue additional guidance in the coming weeks, and broader federal policy shifts remain on the horizon.
• Consult counsel if you are affected. If you or a loved one, or your health care facility, may be impacted, we recommend seeking legal guidance promptly to understand your options.

Falcon Rappaport & Berkman's Elder Law attorneys are continuing to monitor the latest directives from the Department of Health and will provide updates as additional guidance is issued. If you have questions about how this may affect you, a loved one, or your health care facility, please contact the Elder Law Practice Group at dsivak@frblaw.com or by calling (516) 599-0888.

DISCLAIMER: This summary is not legal advice and does not create any attorney-client relationship. This summary does not provide a definitive legal opinion for any factual situation. Before the firm can provide legal advice or opinion to any person or entity, the specific facts at issue must be reviewed by the firm. Before an attorney-client relationship is formed, the firm must have a signed engagement letter with a client setting forth the Firm’s scope and terms of representation. The information contained herein is based upon the law at the time of publication.