District Home, a publicly owned facility for the poor and elderly, plans to reapply to Virginia health officials for permission to build and operate a large nursing home in Manassas to ease a shortage of beds for Medicaid patients in Northern Virginia.

A similar application last year was denied by the state.

Officials of District Home, which is jointly owned by the City of Alexandria and Fairfax, Loudoun, Prince William and Fauquier counties, said the 165-bed facility would ease a severe lack of facilities for Medicaid patients in the region.

District Home officials say that they would cater almost exclusively to Medicaid patients.

Local officials have criticized private facilities that are reluctant to accept Medicaid recipients because, according to the operators, Medicaid does not cover the cost of housing and treating patients.

More than 300 elderly Medicaid recipients from Northern Virginia now are forced to live in nursing homes well outside the metropolitan area, prompting local politicians to support more local homes that will accept Medicaid patients.

"I think it is a pressing need, a very high priority need," said state Del. Mary A. Marshall (D-Arlington), a key proponent of more nursing homes. "We don't have enough Medicaid beds and I hope the application is accepted."

"It definitely would help to alleviate the problem," said Wayne D. Kurtz, District Home's chief administrator. "It's very hard on residents who have to leave the area . . . and on the families who want to keep in contact with their parents or grandparents from a distance."

District Home operates a home for adults in Manassas and a 51-bed nursing home in Warrenton. If the 165-bed nursing home is approved by the state, it would be located on a 54-acre site in Manassas next to District Home's adult facility.

When state Health Commissioner James B. Kenley turned down District Home's bid for a 150-bed nursing home in January, citing insufficient need, Northern Virginia politicians denounced his decision.

District Home's latest application, which would be filed next month and ruled on toward the end of the year, has a better chance of state approval, according to local health officials. They cited Kenley's decision last year to approve an application by another facility to build a nursing home that had been rejected the year before.

Two privately owned firms already have applied to the state to operate nursing homes in Northern Virginia.