Resthomes could lose thousands of migrant workers likely to be hit by new proposed immigration rules, at a time when more caregivers are needed, the Aged Care Association says.
They would then need to reapply.
Aged Care Association chief executive Simon Wallace said migrants make up 30 percent of the sector's 20,000 workers.
But with an ageing population, the number of workers needed was expected to grow by 10,000 in the next decade, and migrants would be relied on to fill those roles.
"The 600 resthomes across the country do their best to employ New Zealanders, as caregivers or nurses, but there just isn't that pool of New Zealanders available, so we employ migrants," he said.
"These changes that the government's announced will have a significant impact on our ability to recruit labour into our sector at a time when we've got an ageing demographic, and we're going to need more caregivers to look after those older people who are increasing in number."
Mr Wallace said resthomes invested a lot of time and money into training migrant workers, and it would be a loss if those workers were forced to leave the country.
He said it was disappointing the government proposed the changes a day after it agreed to pay women caregivers more money.
"[The changes] don't reflect the value of our migrants and what they do for the sector."