Assisted Living vs. Nursing Homes: Care and Cost Differences

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As your loved one ages, they may require more care than they can get from friends and family at home. Choosing a long-term care facility can help improve their quality of life, but the decision can be difficult to make.

Assisted living facilities and nursing homes are two options that provide different levels of care. While assisted living is designed for mostly independent living, nursing homes can provide needed medical care around the clock.

This guide compares assisted living facilities and nursing homes, including their pros and cons, the type of care provided at each institution and their costs. Keep reading to find out how to choose the best senior care for you or your family member.

Table of Contents

• What is assisted living?
• What is a nursing home?
• Assisted living vs. nursing homes: pros and cons
• Assisted living vs. nursing home costs
• How to choose the best type of senior living facility
• Assisted living vs. nursing homes FAQs
• Summary of Money’s guide to assisted living vs. nursing homes

What is assisted living?

Assisted living offers older adults a level of care that still preserves their privacy and independence. It’s for those who can partially live on their own but need assistance with daily routines, such as bathing, dressing, eating and more. Nurses and staff are on-site at all times to assist when needed.

Facilities are often structured like a community. Residents may have a private apartment or room, plus access to common areas. While the apartments may have full kitchens or kitchenettes, residents can also dine in common dining rooms where food is prepared for them.

Additionally, the communities offer a socialization aspect — residents can build relationships, attend classes and go on outings.

Assisted living services

Care services

Although available services can vary by facility and depend on an individual’s care plan, assisted living residences generally offer the following:

• Housing in an apartment-style unit with 24-hour access to nurses and staff

• Bathing, grooming and other personal care assistance

• Transportation

• Nutritious meals and snacks, as well as eating assistance

• Medication management and administration

• Mobility assistance

• Laundry and housekeeping

Some establishments also offer memory care for various types of dementia, including Alzheimer’s disease. This specialized care is typically facilitated in a smaller community within the assisted living facility. It can include designated nurses and staff members, exclusive dining areas and specialized activities.

Additional services

Beyond daily personal assistance, some communities offer additional benefits, including:

• Social activities, including community gatherings, classes and outings

• Outdoor spaces

• Fitness centers and pools

• Recreational activities and areas

• Chapels

• Libraries and shared computers

• On-site health care from outside providers (e.g., dentist, mental health counseling and more)

• On-site personal care (e.g., beauty salon or barbershop)

Assisted living admission requirements

Admission into assisted living communities depends on an individual’s condition and care needs. They must be in stable medical condition but need help performing activities of daily living (ADLs), such as:

• Dressing
• Bathing
• Grooming (e.g., brushing their teeth, fixing their hair, etc.)
• Toileting
• Cooking
• Taking medications on time

A facility can deny someone admission if their needs are beyond the scope of its services. Typically, those who need 24-hour monitoring and intensive medical attention aren't eligible. If you're unsure whether you or a loved one would qualify, ask your medical provider for their opinion.

Once the resident is admitted, the process often involves completing state- and facility-required paperwork regarding facility policies, payment information, legal requirements, care consent and more. The facility will also perform a health assessment to determine a care plan.

Is assisted living the best choice for your loved one?

Assisted living may be an excellent option for those who don’t need intensive medical care but would benefit from help with their everyday routines. It can offer the peace of mind that comes with knowing your loved one will get the care they need while still living independently.

By fostering a sense of community, assisted living can improve your loved one’s lifestyle, making them feel safer and more engaged. If your loved one feels isolated while living at home, this arrangement may be fulfilling because of the socialization opportunities.

However, a nursing home may be more suitable if your loved one has a medical condition that requires constant care. It’s also important to think about future needs. If your loved one requires such care later in life, they may need to move from an assisted living residence to a nursing home.

Moving is a big adjustment, so consider how long your loved one can stay at an assisted living establishment.

What is a nursing home?

Nursing homes provide a higher level of care than assisted living facilities. In addition to helping residents with daily tasks, they provide attentive medical care for aging adults who cannot live independently due to medical conditions that require constant monitoring.

Living quarters are private or shared, depending on availability and the resident's needs and preferences. Nursing homes are more home-like than hospitals but less private than assisted living communities due to necessary supervision.

Similar to assisted living facilities, nursing homes also provide social support programs that allow residents to interact with others and participate in activities.

Nursing home services

Care services

Nursing homes typically provide the following care options:

• Medication monitoring and administration

• Personal care with everyday tasks

• Mobility assistance

• 24-hour medical monitoring

• Medical services, including full-time medical care

• Nutritious meals and snacks, as well as eating assistance

• Rehabilitation services and specialized therapy

• Hospice care

• Transportation (such as visits to off-site doctors)

• Housekeeping and laundry services

Additional services

Nursing homes may also offer these additional benefits, depending on the facility:

• Social community activities, programs and outings

• Financial account management

• Outdoor spaces

• Fitness spaces

• Recreational areas

• Chapels

• Libraries and shared computers

• On-site health care from outside providers (e.g., dentist, mental health counseling and more)

• On-site personal care (e.g., beauty salon or barbershop)

Nursing home admission requirements

Nursing home admission requirements can vary, but individuals must need a high level of care to be eligible. In fact, residents typically have complex health conditions.

According to the Vital and Health Statistics report on long-term care by the National Center for Health Statistics (NCHS), some of the most common conditions in nursing homes are hypertension, Alzheimer’s disease or other dementia, depression, diabetes, arthritis, heart disease and osteoporosis.

However, having one of the above conditions does not mean a nursing home is always necessary — it depends on the situation.

Additionally, while there may not be an age requirement per se, more than 83% of nursing home residents are over 65, according to the NCHS report.

Throughout the admission process, the nursing home may request payment and insurance policy information. And the institution's medical team will likely need information about the applicant's medical history and current medical conditions and needs to create a personalized care plan.

Is a nursing home the best choice for your loved one?

Determining the best choice for your loved one can be challenging. A nursing home may be the best option if their health and wellness require more hands-on care. This could mean they can’t live alone and need more than the moderate assistance offered in assisted living facilities.

However, it’s important to keep in mind that moving into a nursing home is an adjustment. Your loved one will have to sacrifice privacy and independence. Even if that's the level of care they need, the transition can still be emotionally challenging.

Assisted living vs. nursing homes: pros and cons

Assisted living communities and nursing homes each have distinct pros and cons. They are two very different types of living situations with different purposes. The right choice for your loved one largely depends on their care needs.

That said, here are the pros and cons of each facility to help you compare.

Assisted living pros and cons

Nursing home pros and cons

Assisted living vs. nursing home costs

Due to the nature of the care provided, nursing homes are typically more expensive than assisted living facilities. According to Genworth’s Cost of Care Survey, the median monthly cost for assisted living is $4,500. Conversely, nursing home median costs are $7,908 for a semi-private room and $9,034 for a private room.

Costs can vary based on many factors, including your location, the facility you choose, and the care your loved one needs. Some facilities charge all residents a flat monthly rate. Others charge differently based on the resident’s care plan.

The cost typically includes the following:

• Room and board (housing rent, utilities, meals, etc.)
• Housekeeping
• Personal care
• Medical supervision and care (if applicable)
• Transportation
• Amenities and other services

Assisted living and nursing home payment options

There are a number of ways people pay for senior living communities or facilities, including personal savings, insurance or government programs. Here’s more information about assisted living and nursing home payment options.

Private funds

Many people pay for assisted living facilities and nursing homes out-of-pocket. They often use retirement income, savings, pensions or personal financing.

Another option is selling assets like a house to get funds. If the individual doesn’t have long-term care insurance and isn’t eligible for Medicaid or veterans benefits, this may be the only option available to them.

Medicare

Medicare doesn’t cover custodial care — non-medical care — in a nursing home or assisted living establishment if that’s the only care the individual needs. However, Medicare Part A (hospital insurance) may cover limited stays in a skilled nursing facility.

While skilled nursing facilities are similar to nursing homes, they differ in that they’re designed for short-term stays rather than permanent ones. They offer medically necessary residential care for someone recovering from a surgery, illness or other medical condition. Medicare may also cover skilled nursing care at home.

If the care falls under the medically necessary category, Medicare covers a portion of the costs for up to 100 days during a benefit period. The benefit period begins the day the individual is admitted for care and ends once they haven’t received care for 60 days in a row.

The copay throughout the benefit period can vary. It will be $0 during the first 20 days and increase to $200 for days 21 through 100. Medicare Advantage plan members may have different copayment requirements, so make sure to check your plan details.

Medicaid

Medicaid may cover the full cost of a nursing home stay for eligible participants who meet the program's income requirements in their state. Additionally, they must choose a facility that's licensed and registered as a Medicaid Nursing Facility. Lastly, Medicaid may only pay for services once all other payment methods have been depleted.

If your loved one doesn’t need to enter a nursing home, your state’s Medicaid program may offer waivers to help cover living expenses in an assisted living facility. You can view the available waivers list on the Medicaid.gov website.

Long-term care insurance

Long-term care insurance is a type of insurance policy that helps pay for the cost of extended care once the policyholder requires help with ADLs. People usually purchase a policy in their early 50s or 60s to help pay for an assisted living facility or nursing home in their later years.

Long-term care insurance benefits may begin once the policyholder is diagnosed with a cognitive impairment that requires daily assistance or supervision.

However, there’s usually an elimination period — also called a waiting period. During this time, the individual must pay for their long-term care costs out of pocket. Once the waiting period ends, the policy will cover those costs up to its limits.

Some policies have daily limits and generally have a set number of years during which they will cover qualifying long-term care expenses.

Veterans benefits

Eligible veterans can apply for the Department of Veterans Affairs (VA) Aid and Attendance benefit. If approved, extra funds will be added to their VA pension to be used for long-term care. Veterans can apply in person at their VA regional office or by mailing the required documents to their pension management center.

Additionally, each state has at least one veterans home. These homes are state-owned and operated facilities, such as nursing homes, adult daycares or assisted living communities. The VA may subsidize part of the veteran's care costs, but their out-of-pocket expenses will vary based on their income and state. Check with your state to see what’s available in your area.

How to choose the best type of senior living facility

A senior living facility is both a financial and quality-of-life investment. Choosing the right one is a major decision. If you’re deciding between an assisted living facility or a nursing home, the basis of your decision should be the type of care you or your loved one needs.

“I think the choice between a nursing home and assisted living facility should always come down to what’s in the best interest of the individual. The individual [who] is moving should always have a say in where they are going,” says Michelle Saari, registered dietitian and health and nutrition specialist at the National Coalition on Health Care.

Additionally, not all facilities are created equal. When evaluating each establishment, it’s important to consider what factors matter most to you or your loved one.

How to choose an assisted living facility or nursing home

When evaluating assisted living facilities, keep the following factors in mind.

• Location: Look for facilities available in your general area or wherever you or your loved one want to receive care. Perhaps an ideal location is close to family and preferred medical providers. If you’re looking for a nursing home, use the search tool on the official Medicare website to compare Medicare- and Medicaid-certified facilities and view ratings.

• Facility details: Consider the type of assisted living facility or nursing home that’s most suitable based on its size and room options.

• Type of care: If your loved one has particular needs, make sure the facility would meet them. For example, some facilities offer on-site mental health counseling or physical therapy. Additionally, some have memory care units for those with dementia.

• Amenities: Decide what amenities are most important to you or your loved one (e.g., pool, fitness area or outdoor space).

• Dietary requirements: See what the facility offers for meals and if dietary restrictions and preferences can be met.

• Rules and policies: Review the facility’s policies. What can residents bring to their apartments? What is the visitor policy? What other rules and restrictions apply?

• Costs and fees: Figure out what the facility includes in the monthly price and what costs extra.

• Staffing: Ask about staffing to ensure enough caregivers are available for the number of residents.

• Social activities: Look into the social aspects of the facility. What programs and activities does it offer? Does it have off-site events?

• Transportation: Figure out how the transportation works. Facilities typically have a bus that transports residents to and from certain locations. The bus may also take residents to off-site appointments.

• Safety and security: Determine what safety and security measures are in place. What protocols do staff follow?

• Word of mouth: Ask people you trust for recommendations. If you have friends or family members who have experiences with senior living facilities, ask for their opinions.

Tips when visiting an assisted living facility or nursing home

Visiting the facility before committing to living there is a great way to determine whether its quality of care meets your standards.

Here are some tips when visiting a facility:

• See what all the living areas look like — both private rooms and common areas. Determine if you or your loved one would be comfortable there.

• Ask questions about the amenities and rules around them. For example, is transportation only offered during certain hours?

• Observe if the establishment is clean, safe and secure. Consider asking questions about how the facility handles infectious diseases.

• Observe the overall mood and atmosphere of the facility — do the residents and staff seem happy?

• Review the meal options and consider trying the food, if permitted. Saari recommends finding a place that cooks food in-house rather than one that has food shipped in because it may offer better personalization for dietary preferences and restrictions.

• See if there’s an adequate amount of staff available. Many facilities face problems with understaffing.

Saari also recommends you avoid basing your decision solely on a facility's appearance. She says, “I have worked in some nursing homes that haven’t been able to renovate for many years, but they had some of the best health care teams I’ve been a part of.”

Summary of Money’s guide to assisted living vs. nursing homes

Two of the most common senior living options are assisted living facilities and nursing homes. Assisted living is for those who can live mostly independently but need help with daily activities. On the other hand, nursing homes are for those who require round-the-clock care and can’t live on their own due to complex medical needs.

Elder care can be expensive, but a long-term care insurance policy can help cover the cost. Aside from that, some individuals may be covered by Medicaid or VA benefits. Unfortunately, Medicare only covers short-term stays in skilled nursing facilities.

Before deciding on the best option for your loved one, consider things like proximity to family and medical providers, food options, room arrangements, policies, amenities, resident-to-staff ratio and more. Above all, ensure the institution meets your loved one’s needs. Touring a facility and observing the staff can help you determine whether your loved one would be happy there.