The 166 residents of Lakeside Health in Chippewa County have until January 31st to find a new place to live.
Government agencies are offering assistance, but finding space for those staying in nursing homes could be a challenge.
Some local officials say the number of available beds is only around 50 in the surrounding area.
Governor Jim Doyle says the state will work with families on an individual basis to find space within the same community.
"Fortunately this doesn't happen very often, but from time to time a nursing home shuts down or we have to close one. We will do as we always have to handle it, patient by patient, and continue to work with families," Governor Doyle said.
Lakeside also housed a ventilator unit, the only one of its kind in this part of the state.
Losing that causes concern for people needing that type of care where a ventilator is necessary, but the department is contacting other nursing homes where it can be put to use.