Gov. McKee’s Proposed FY 27 Rhode Island Budget: What’s in It for Seniors

Published in RINewsToday on February 2, 2026

Gov. Dan McKee outlined key elements of his proposed $14.8 billion FY 2027 budget during his State of the State Address on Jan. 13, 2026. Two days later, his full budget, proposing a 3.6% increase over the previous fiscal year, was officially released via press release.

The budget centers on an “Affordability for All” agenda and a $600 million bond package, covering the fiscal period starting July 1, 2026. Key proposals include a new income tax tier for earnings over $1 million, a permanent child tax credit, a phased elimination of the state tax on Social Security benefits, repeal of a gas tax increase, and continued investments in projects that support jobs and economic growth.

The proposal also aims to shield vulnerable Rhode Islanders from potential federal cuts, including the elimination of Affordable Care Act subsidies, changes in Medicaid eligibility rules, reductions in federal support for hospitals treating uninsured patients, and modifications to SNAP regulations.

“My commitments to Rhode Islanders are clear: putting more money back in families’ pockets, protecting the most vulnerable from President Trump’s safety net cuts, and keeping Rhode Island building to support good-paying jobs and long-term economic growth,” McKee said in a statement accompanying his full budget.

While the Governor’s plan emphasizes affordability through higher incomes and improved healthcare outcomes, along with proposing a 3% tax on high earners, Jesse Martin, Executive Vice President of SEIU 1199NE, cautions, “The plan falls short of what’s needed to meet these goals. What’s more, the state’s recent minimum wage increase has actually reduced take-home pay for low-income home care workers and cut care hours for their vulnerable consumers. Rather than reducing care, the governor should offset these costs through increased federal Medicaid funding.” Martin co-represents over 5,000 health care and service workers in Rhode Island.

Budget Highlights for Older Adults  

For over a decade, the Rhode Island General Assembly has considered measures to gradually eliminate or reduce the state tax on Social Security benefits. This budget proposes phasing out this tax over the next three years. The full cost impact would be $60.1Million in FY 2030.

In AARP Rhode Island’s 2023 Vital Voices survey of Rhode Islanders 45+, 89% agreed that “Rhode Island lawmakers should repeal the state tax on Social Security,” said State Director Catherine Taylor in a newspaper editorial. “This sentiment is consistent regardless of age, gender, or political party,” she said.

Laura Hart, Gov. McKee’s Deputy Director of Communications, notes that senior services funding has grown under his leadership: “In FY21, the budget included $0.8 million for senior services. By FY26, that number had risen to $1.6 million. For FY27, the governor recommends $1.8 million—more than doubling the funding since he took office.”

Hart adds, “Rhode Island is only one of eight states that tax Social Security income. This tax can discourage retirees from staying in the state and contributing to the economy. Under the Governor’s proposal, the phase-out prioritizes 9,000–10,000 early retirees whose average income is $44K single/$75K joint—clearly not high-income earners—and who represent one-third of the population currently subject to the tax.”

Aging advocates continue to push for an increase in funding for local senior centers, aiming for allocations equivalent to $10 per resident age 65 and older.

Support for Nursing Homes and Affordable Housing

LeadingAge Connecticut & Rhode Island was pleased to see the Governor’s budget proposal include a 2.5% cost-of-living adjustment for nursing home rates, along with an initial rate increase equal to 50% of Rhode Island’s Office of the Health Insurance Commissioner’s biennial rate review recommendation for many Medicaid-funded home and community-based services,” says President Mag Morelli. “We understand this increase is intended as the first phase, with the remaining 50% anticipated next year,” she said.

Morelli also highlights the Administration’s focus on affordable housing, noting the growing need for accessible and affordable options for older adults. She urges further support for Medicaid-assisted living programs to sustain existing services and promote expansion, which she describes as a cost-effective option supporting independence and choice.

Kathleen Gerard of Advocates for Better Care in Rhode Island, a member of the Raise the Bar on Resident Care Coalition, emphasizes the importance of transparency and resources: “As our long-term care system faces increasingly complex pressures, transparency, accountability, and adequate resources are critical to protecting the health and safety of older adults and people with disabilities.”

She adds, “In addition to enforcing the Nursing Home Staffing and Quality Care Act, Raise the Bar is calling for a full Medicaid cost-of-living increase for nursing homes—above the 2.5% proposed by Governor McKee. We also urge new funding for the Ombudsman program, which has gone years without an increase despite its vital role in helping residents resolve care concerns. Finally, we support the Department of Health’s nursing home financial transparency bill to ensure owners are accountable for public funds.”

Other Provisions

The proposed budget also aims to maintain enhanced Affordable Care Act subsidies to keep coverage affordable for approximately 20,000 individuals. Without $9.5 million in state funding, an estimated 6,500 individuals could lose coverage.

The budget seeks to curb healthcare cost growth and increase drug-price transparency by authorizing the Office of the Health Insurance Commissioner to set enforceable annual cost-growth targets and requiring Pharmacy Benefit Managers to report detailed rebate, pricing, and fee data. These measures are designed to improve oversight, contain costs, and reduce drug prices for older Rhode Islanders.

McKee also proposes a $19.3 million investment in information technology, personnel, and resources to ensure Rhode Islanders can retain Medicaid and SNAP benefits under the federal reconciliation bill H.R. 1, while maximizing federal funding for these critical programs.

Additionally, the budget allocates $10 million to Rhode Island-based hospitals through the Disproportionate Share Hospitals payment to offset uncompensated care losses. Funding for social and human services providers is increased by $23 million in FY27, and state funds to combat food insecurity are doubled, raising support for the Rhode Island Community Food Bank from $1 million to $2 million. According to America’s Health Rankings, roughly 4.1% of Rhode Island adults aged 60 and older face food insecurity.

Securing Affordable Living for All Older Rhode Islanders

SACRI was pleased to see McKee put emphasis on affordability in his budget address and his expressed support for increasing taxes on higher-income residents to fund essential services, said SACRI Policy Advisor Maureen Maigret. When hammering out the FY2027 budget proposal, she urges the  House and Senate Finance Committees to allocate additional funding for programs and services that assist low- and moderate-income older adults from across the state facing economic challenges. The reality is that  one out of four older RI households have income less than $25,00 and almost half have income less than $50,000. Affordability measures must be aimed at putting money in the pockets of all older adults and not just those fortunate enough to have higher incomes, stated Maigret.

According to Maigret, SACRI has proposed and shared its 2026 Affordability Agenda for Older Adults for the Rhode Island General Assembly to consider as it develops and finalizes the state’s FY2027 state budget. The agenda tackles significant inequities in state programs and services, she noted, pointing out that Medicaid currently allows older adults and adults with disabilities to have only $4,000 in assets (for individuals) to remain eligible. This restriction is particularly unreasonable for those trying to live independently at home, especially since other Medicaid populations do not face such limits. What happens when the roof needs repairs or the hot water heater breaks,” she said.

Maigret stressed that keeping people at home and out of more expensive nursing homes can save the state money over time. She added that in 2025 with strong advocacy from SACRI, strides were made in expanding eligibility for the Medicare Savings Program (MSP), and as of February 1, individuals with incomes up to $2,255 per month are eligible—provided their assets are below $9,660.

SACRI advocates joining at least 12 other states in removing Rhode Island’s MSP asset limitation so that hundreds more Medicare recipients could have their $202.90 monthly Part B premium covered by the federal government. The savings would flow back into the state economy as recipients use the funds for basic needs.

SACRI supports the Governor’s proposed child care tax credit and also advocates for a similar credit for the hundreds of unpaid caregivers providing at-home care for older loved ones, often at significant financial sacrifice.

“We also strongly support Rep. Karen Azalter’s (D-Dist. 60, Pawtucket, Central Falls) and Senator Melissa Murray’s legislation (D-Dist. 24, Woonsocket, North Smithfield) legislative proposals  (H7313 and S2238) to create a 3% surcharge on the top 1% of income earners. The projected revenue of more than $200 million would help offset the modest costs of the proposals in our agenda, as well as other programs affected by federal changes,” Maigret said.

Next Steps

“The submission of the budget by Governor McKee signals the start of the months-long budget process,” says House Speaker K. Joseph Shekarchi (D-Dist. 23, Warwick). The House and Senate Finance Committees will hold dozens of public hearings, all televised by Capitol TV, to scrutinize every aspect of the budget.

Shekarchi adds, “We welcome all interested parties to testify at the State House. Once the hearings are completed, the House, Senate, and Governor will work together to finalize the budget in late May for adoption in June. Once enacted, it will go into effect on July 1.”

To view Governor McKee’s full budget submission, visit: https://omb.ri.gov/budget-office/fy-2027-governors-budget.

Rhode Island nursing home bill veto response

Published in RINewsToday on July 1, 2024

With the adjourning of the General Assembly on the early morning of June 14, out of thousands of bills thrown into the legislative hopper in this year’s legislative session, 249 bills passed both chambers.  At press time, Gov. Dan McKee has vetoed five bills, including one to create a Rhode Island Nursing Home Workforce Standards Advisory Board (WSB).

Just weeks after the General Assembly overwhelmingly approved the establishment of a 13-member advisory board to keep state leaders informed on current market conditions, wages, benefits and working conditions in Rhode Island’s nursing home industry, McKee vetoed the legislation. The final vote count for H 7733 A was 63-7 in the House and 37-0 in the Senate for S 2621 A.

WSB would advise the General Assembly and the RI Department of Labor and Training on market conditions, wages, benefits and working conditions in the nursing home industry; recommend minimum statewide compensation and working standards for nursing home workers; propose minimum standards for nursing home training programs and assist in ensuring compliance by employers with the recommended standards.

This advisory board would consist of three members representing nursing home employers, three representing nursing home workers, two representing community organizations that work with the Medicaid population, one member representing a joint labor-management multi-employer nonprofit training fund, and representatives of the Health and Human Services secretary, the Department of Labor and Training, the Department of Health and the Long-Term Care State Ombudsman.

Reasons Gov. wielded his veto pen

On June 26, Gov. McKee’s 2-page veto message to House Speaker K. Joseph Shekarchi (D-Dist. 13, Warwick) and Senate President Dominick Ruggerio (D- Dist. 4, Providence, North Providence) outlined his objections to creating the WSB.   

“Rhode Island needs comprehensive solutions to resolve its critical nursing home emergency and support residents, workers and the long-term care facilities,” stated McKee, stressing that the Act didn’t meet that need.

McKee noted that letters submitted by nursing homes and assisted living facilities opposing this legislation charged that the Act didn’t address real issues faced by facilities, including “years of underfunding, increased costs and the lack of available workforce in the state.”

The Board created by the Act focused narrowly on only working conditions and wages without consideration for the key constraints such as reimbursement, the governor told lawmakers.  This will not “generate the comprehensive solutions Rhode Island needs to address the nursing home emergency,” he added.

Aging advocacy groups call for an override of the veto

“Governor McKee’s veto of legislation to create the WSB is a significant setback in our efforts to improve the quality of care in Rhode Island’s nursing homes and to find a way out of the nursing home crisis,” charges Kathleen Gerard, Director of Advocates for Better Care in Rhode Island (ABC-RI) in a statement quickly released after the governor’s veto.

“The veto yet again underscores the reality that the McKee administration has created no framework or plan to stabilize our state’s broken nursing home system,” says Gerard. “Instead of once again catering to the concerns of for-profit facility owners, Governor McKee must prioritize the needs of thousands of nursing home residents and caregivers who continue to suffer from the staffing crisis,” she adds.

According to Gerard, Governor McKee says that the WSB is not a sufficiently comprehensive solution, but the governor himself has proposed no alternative solutions. “In fact, when convening his own closed-door nursing home advisory board, he initially included only industry representatives, then perfunctorily invited union representatives for the final meeting, but failed to include consumer advocates, Long Term Care Ombudsmen, or Medicaid experts,” charged Gerard.  

Gerard notes that the only recommendation from the industry members in this group was to indefinitely suspend enforcement of the Nursing Home Staffing and Quality Care Act—a course of inaction which lacked any basis in evidence and did nothing to ameliorate any of the critical problems with care in Rhode Island nursing homes. “In fact, that course only hurt the facilities that were consistently meeting minimum staffing requirements,” she says.

“Governor McKee’s veto of the WSB is a devastating blow to the residents of Rhode Island’s nursing homes,” says Raise the Bar on Resident Care Coalition in a released statement. Currently, 34 out of 74 nursing homes are rated by the Centers for Medicare & Medicaid Services at two CMS stars or lower, indicating a dire need for improvement in care standards, notes the resident advocacy coalition. 

According to WSB, the legislation creating the Nursing Home Workforce Standards Board would have ensured better training and working conditions for caregivers, which are essential for enhancing the quality of resident care. Rhode Island ranked second in the nation for serious nursing home deficiencies in the last three years, highlighting the urgent need for comprehensive solutions that prioritize the health and safety of residents.

Raise the Bar urges the Rhode Island General Assembly to override McKee’s veto. “The WSB bill was a necessary step towards ensuring better wages, benefits, and training for caregivers, and higher quality care for residents,” says the advocacy coalition, calling on the McKee administration “to remember its promises and create a comprehensive plan to end the nursing home crisis in Rhode Island.”

“The Senior Agenda Coalition of RI (SACRI) is extremely disappointed with Governor Dan McKee’s veto of the legislation passed by the House and Senate to create a Nursing Home Workforce Standards Advisory Board, andn we are calling for the general assembly to override the veto”, said Diane Santos, SACRI’s Chair, in a statement.

There are significant issues impacting the state’s nursing homes from how they are financed; the adequacy of staffing levels, training and wages; and the quality monitoring process, stated Santos. “As the state’s population grows older there will be an ongoing need to provide quality nursing home care for those with high support needs. It is critical that the many issues facing the nursing home industry be addressed,” she said.

ABC-RI and Raise the Bar strongly urge the Rhode Island General Assembly to override McKee’s veto and allow the creation of the WSB. 

In response to the aging advocacy groups calling for a veto override, House Speaker Shekarchi and Senate President Ruggerio issued statements pledging to review the Governor’s veto messages and to confer with each other and lawmakers to determine their response.  

Provider groups give thumbs-up to Gov. McKee’s veto

The state’s largest nursing home provider group agrees with Gov. McKee’s veto of the Workforce Standards Advisory Board, says John E. Gage, President and CEO of the Rhode Island Health Care Association. “This legislation would have set a precedent, establishing an Advisory Board with a narrow and ill-defined mission that failed to recognize the myriad of challenges facing nursing homes in Rhode Island and across the nation,” says Gage,  “these challenges include chronic Medicaid underfunding, skyrocketing costs, a historic workforce shortage, and the existing staffing mandate that is unfunded and fails to address the workforce crisis and includes draconian fines and penalties.”

According to Gage, S 2621A and H 7733A would also have replicated the many layers of existing oversight authority that exists at both state and federal levels – including CMS, the Occupational Safety & Health Administration, the RI Executive Office of Health & Human Services, the RI Department of Health, and the RI Department of Labor & Training, among others.

“There needs to be a comprehensive solution to the current environment of care facing Rhode Island’s nursing homes,” says Gage, stressing that this strategy should include workforce training programs, student loan forgiveness for RI nursing home professionals including RNs, LPNs and CNAs who are trained and choose to remain in RI to work in long-term care settings.

“In addition, reimbursement from Medicaid must become and remain adequate to cover the increasing cost of care in all settings, and changes are needed to address the staffing mandate passed back in 2021,” says Gage, noting that the bill was passed in the midst of the Covid-19 pandemic without addressing the workforce crisis and failing to provide sufficient funding that would be needed to layer in sufficient staff to meet the metrics, if those staff could be found.

Gage says that if fully implemented and enforced, fines would amount to $100 million in the first full year of enforcement – closing the majority of facilities, displacing thousands of vulnerable residents from their homes and devastating access to care for Rhode Island seniors.

LeadingAge RI agrees with RIHCA’s detailed observations about this issue and the Governor’s veto message, which highlight the myriad of entities already in place to oversee and enforce nursing home care, says James Nyberg, Executive Director of LeadingAgeRI. “Furthermore, the Governor noted the need for a more comprehensive solution to the nursing home emergency, and steps are already being taken or are in place towards this goal,” he said.

According to Nyberg, the Governor and General Assembly just made a significant investment in the chronically underfunded industry in this year’s budget, which will benefit all residents and staff.  In addition, the industry has regular meetings with the Health Department and Centers for Medicare & Medicaid Services to  discuss any quality-of-care issues and how to mitigate and resolve them immediately, he says, noting that these meetings are frank and productive. 

Nyberg noted that the industry, and individual nursing homes, also provide countless hours of educational programming to support and improve quality of care.  “All nursing home providers are working to overcome the challenges facing the industry, and demonizing them is disrespectful to the thousands of individuals who work 24/7/365 to care for our older Rhode Islanders,” he says.

As the dust settles…

Last Monday, Gov. McKee’s veto message was sent to House Speaker Shekarchi and Senate President Ruggerio to notify them of his veto. Now they can either let the veto stand or allow it to die.  Overriding the veto can occur if three-fifths of members in both chambers vote to affirm the bill’s passage. This vote would need to take place before the start of the new law-making session in January.

As the dust settles after McKee’s vetoing of legislation to create a WSB, with the overwhelming support of the General Assembly and the lobbying of resident advocacy groups opposing McKee’s veto, will the General Assembly have the political will to act and override the governor’s veto, especially during a time when lawmakers are just beginning their political campaigns? 

We’ll see…