How Much Do Nursing Homes Cost?

If you’re considering a nursing home for yourself or your loved one, you may see that there are more benefits now than ever before. From beautiful accommodations and resort-like amenities to a carefree lifestyle that may not be possible at home, there are certainly many things to look forward to in a nursing home, but one thing most people don’t look forward to—the cost. 

We get it and we’re here to help! In this guide we’ll help you understand not only the costs of a nursing home, but how to be smart with your finances leading up to making a switch to this type of senior living. Learn more below or find a nursing home here!

How Much Do Nursing Homes Cost?

Nursing home costs can vary quite a bit based upon factors such as size of accommodation (private or semi-private room), type of senior housing, and the level of care needed. According to data over a recent 15-year period from Genworth, the annual cost of nursing home care has risen on average between 1% – 3% per year, with the median cost of a private room in 2020 being around $105,850 (Cost of Care Survey).

Depending on where you choose, the cost is often comparable to that of rent plus other living expenses such as utilities, food, and housekeeping service. Nursing homes are considered the highest level of care offering help with activities of daily living, 24/7 medical care, and access to physical therapy and other types of long-term care services. Therefore, the need to pay qualified medical staff increases the price of nursing home stays, but this may be offset by eliminating other costs, such as mortgage payments, real estate taxes, home maintenance, and more. 

Nursing Home Costs Regionally

The cost you will pay will depend upon where in the United States you live, because nursing homes in populous cities tend to cost more than in rural areas. For example, the average annual cost for a private room in New York is $147,825, whereas the same room in Oklahoma might cost an average of $63,875. 

According to Genworth, the most expensive states for nursing home services are Alaska, District of Columbia, Connecticut, Hawaii, Massachusetts, and New York with daily costs above $400. The least expensive states are Texas, Missouri, Oklahoma, Louisiana, Arkansas, and Illinois with daily costs below $205.

How Much Does Medicare Cover for Nursing Homes?

Unfortunately, due to the fact that nursing home stays are usually for a long-term period of time, Medicare usually will not cover this type of care. On the other hand, if you qualify for short-term stay in a skilled nursing facility, Medicare may be able to pay 100 percent of the cost —  nursing care, room, meals, etc. — for the first 20 days. Learn more about this on our skilled nursing facility costs page. 

Ways to Pay For Nursing Home Care

Since nursing homes are long-term stays and therefore not as easily covered by Medicare, here are some other options to help you pay:

  • Private pay: Private pay is typically the first source seniors turn to for retirement. These are funds you have accumulated through savings, investments, monthly income, and more. This money is usually set aside for the purpose of paying for elder care. 
  • Real Estate: Many seniors plan to sell their current home and use this equity to fund the move to the home they want in retirement. 
  • Long-Term Care Insurance: This private insurance can help cover the costs of future senior living, assisted living, memory care, and skilled nursing care
  • Veteran Benefits: Eligible veterans and their spouses may qualify for the Aid and Attendance program through the Department of Veterans Affairs to help cover senior care costs.

Can You Go to a Nursing Home Without Any Money?

Medicaid might be an option to pay for a nursing home when no money is available. Even if you were not considered low-income enough to qualify for Medicaid in the past, your Medicaid eligibility may have since changed. Although, keep in mind that many nursing home communities only have a few Medicaid beds, if any

Many people also ask about what happens if the money runs out. Before you sign a contract with a community, determine if any policies are in place for residents who suddenly cannot pay and whether the community offers a resident financial assistance program. 

Ways to Be Smart With Finances

Planning for the future is often exciting and overwhelming at the same time. No matter how old you or your loved one is, taking simple and careful steps now to be smart with your finances can help down the line. Like any financial planning, it helps to create a strategy and work toward a goal so that you can stay on track amid other financial responsibilities. Here’s what to consider:

  1. Examine the full financial situation: Caregivers and their family members need to take a realistic look at how much they can contribute to elder care, including the cost for the lowest and highest level of care they may need to pay. Identifying how much you’ll need to save at both the high end and low end will allow you to create a savings plan early on as well as identify gaps that demand the exploration of other funding alternatives.
  2. Consult a financial planner: Paying for professional financial advice can help you save long-term. A financial planner who has experience in elder financial planning can help provide budgeting and savings advice, as well as investment insights for caregivers.
  3. Make lifestyle changes to prolong care costs: Exercise and healthy eating can go a long way to save in future health care costs down the line. You may also use preventive health services to get ahead of any issues before they get worse. Most health plans—including those available through the Health Insurance Marketplace—offer free in-network preventive services like screening tests and shots. 
  4. Look for discounts: Some medical providers will offer discounts for paying in cash. Others will provide free zero-interest payment plans, which can help when seniors need to pay multiple bills. You can even clip coupons or look online for discounts on pharmaceuticals.
  5. Consider a health savings account: To help you prepare for unexpected medical expenses and reduce your taxable income, you may open a health savings account in which what you save will grow tax-free. When you turn 65, you can start making withdrawals for qualifying medical expenses.

Find Nursing Homes Near You

At Caring Advisor, it’s our goal to help all individuals and their families with senior living needs to find comfortable, supportive housing. Our supportive staff are here to help you navigate senior living and find a nursing home that is best for you or your loved one.