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Assisted Living vs. Nursing Home Costs (Which Is More Expensive?)

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Costs of nursing homes and assisted living facilities vary from state to state but on average, nursing homes are more expensive than assisted living facilities. In 2023, the average cost of a nursing home room was $108,000 a year. A high-end assisted living facility averaged $84,000 a year.

It’s important for any family member who is the designated caregiver of older adults to be aware of the costs of their local senior home facilities.

The best way to make a good decision is to have as much information as possible.

Certainly, if someone has medical needs that require skilled nursing care then there may be no option to choose but if you do have to choose, it’s best to know your options.

As you debate between a nursing home or assisted living for your senior, one major deciding factor is going to be the cost.

Of course, you will also want to look at other issues such as recreational activities that are available, what quality of life your senior loved one would have, what levels of care are available in the type of facility you choose, etc.

Is Assisted Living More Expensive Than A Nursing Home?

Which of these two options would be pricier?

Let’s compare the two:

Nursing Home Costs

Of course, the decision to choose a nursing home depends on the type of care and medical assistance that an individual would need but cost is an issue as well.

Generally speaking, a nursing home is a good option for the elderly who need skilled care 24/7 and require the availability of physical therapists, a registered nurse, and in house physician.

It’s also a good option for seniors who want to take advantage of social activities, physical therapy, and occupational therapy as well as in-house medical services.

According to Senior, in 2020, a semi-private nursing home room may cost $245 a day. That’s $7,441 a month and $89,297 a year.

If you wanted a private room for your senior to live at the nursing home, you may be looking at costs of $275 a day, $8,365 a month, and $100,375 a year.

The current trend of pricing in skilled nursing facilities is on an upward trajectory:

  • For a semi-private room in 2016, you would have spent $82,128 a year. That same year, private rooms cost $92,376 annually.
  • It’s believed that by 2028, the annual price of a semi-private nursing home room could be $120,008 and $134,896 for a private room.

These costs are averages (even for 2021). Depending on where in the United States you call home, you may pay less than the average or even more.

States such as Oklahoma and Texas are the cheapest, with semi-private rooms less than $5,000 a month and private rooms under $7,000 monthly.

There are also many states with semi-private nursing home costs that average around $6,000 to $7,000 a month, with private rooms between $5,500 and $7,500. These include Missouri, Arkansas, Illinois, Utah, Iowa, Alabama, Tennessee, and South Carolina.

The 10 most expensive states for nursing home care, according to Senior‘s most recent data, are:

  • West Virginia
  • New Hampshire
  • Delaware
  • New Jersey
  • North Dakota
  • New York
  • Massachusetts
  • Hawaii
  • Connecticut
  • Alaska

In any of these 10 states, semi-private rooms start at $10,200 and go up to $12,600, while private rooms are priced at $11,000 – but may cost as much as $13,700 a year. The only exception is Alaska, in which a semi-private room is $27,573, and a private room $29,291 a year.

How To Pay For A Skilled Nursing Facility

Remember that if your senior is enrolled in any of the Medicaid programs in your state or Medicare, it’s possible for this insurance to kick in on some or even all the costs of nursing home living.

Speaking of Medicaid coverage, Paying For Senior says, “Practically speaking if one is seeking Medicaid assistance, they should not begin by taking their loved one to a doctor to obtain a Nursing Home Level of Care designation.

Instead, they should start by contacting their state Medicaid office.

The state will likely require that a specific group of doctors, therapists, or administrators be used to make the determination, and it is unlikely that one’s primary care doctor is included in this group.”

You can find your state’s Medicaid Program contact information here.

Assisted Living Costs

For seniors who can enjoy more independent living and do not require 24-hour care, assisted living may be the right choice for them.

Some provide assistance with medication management and some ADLs (activity of daily living tasks) but generally speaking, seniors in these facilities are fairly independent.

Of course, there are other senior housing options available too.

Assisted living communities are on a private pay model, so it’s a lot harder to get estimates compared to nursing homes.

But according to the “…national median cost for a one-bedroom unit in a private-pay assisted living community is now $4,300 per month…”

As with the nursing home costs above, the prices of assisted living do vary from state to state across the US.

The prices are all over the board, so we randomly selected a handful of states to show you the discrepancies.

Included are daily, monthly, and annual costs.

  • Wyoming: $131 a day, $3,995 a month, and $47,940 a year
  • Texas: $116 a day, $3,515 a month, and $42,180 a year
  • Rhode Island: $162 a day, $4,931 a month, and $59,161 a year
  • Ohio: $118 a day, $3,600 a month, and $43,200 a year
  • New York: $136 a day, $4,136 a month, and $49,635 a year
  • Nevada: $100 a day, $3,050 a month, and $36,600 a year
  • Minnesota: $105 a day, $3,200 a month, and $38,400 a year
  • Louisiana: $104 a day, $3,155 a month, and $37,860 a year
  • Hawaii: $136 a day, $4,125 a month, and $49,500 a year
  • Illinois: $128 a day, $3,898 a month, and $46,770 a year
  • Florida: $100 a day, $3,045 a month, and $36,540 a year
  • Washington, DC: $220 a day, $6,700 a month, and $80,400 a year
  • California: $132 a day, $4,000 a month, and $48,000 a year
  • Alabama: $95 a day, $2,900 a month, and $34,800 a year

As you can see, where you live can impact your yearly expenses if you will be moving into an assisted living facility. Before choosing one, check out some questions you should ask management and staff members.

How To Pay For An Assisted Living Community

Here are 7 resources available that can help with the costs of living in an assisted living community.

Life Insurance

Your life insurance company may buy back your policy (at a reduced percentage of course) but it may be enough to cover a good portion of your assisted living costs.

You may also be able to convert your life insurance policy into a long-term care type of policy.

Check with your insurance agent to go over all the options that they may offer and what their requirements may be for you to be eligible.

Long-Term Care Insurance

Long-term care policies can greatly benefit you if you purchased them at a young age and if your policy specifically outlines payments for assisted living facilities.

If you are a senior and haven’t yet purchased a long-term care insurance policy – generally speaking – it may be too late. The cost of this type of policy for a 65-year-old would be about $7,000 per year.

Veteran’s Benefits

Although getting benefits from the Veteran’s Administration can be daunting (very time-consuming and complicated) it may be worth it.

the VA covers residential care if…

  • the veteran has service-related injuries / disabilities
  • the veteran’s income is below a certain amount

The details of what the VA will pay may change so we recommend that you contact your local Veteran’s Administration.


If you invested in an annuity you are in luck. Your investment will come in handy as it can certainly help to pay for some (or maybe even all) of your monthly expenses in your assisted living facility.

In addition, the Pension Protection Act of 2006 allows you to use proceeds from certain annuities to pay the premiums for long-term care insurance. These proceeds would be tax-free.

But note that although the Pension Protection Act reads like a great idea – it’s not necessarily as good as it sounds!  Check out this article at

Reverse Mortgage

Another somewhat controversial plan is reverse mortgage programs which are basically a loan paid to the homeowner based on the equity of the home.

This money could go towards paying for assisted living.

This would oftentimes come into play when one spouse remains in the home and the other moves into an assisted living facility.

We recommend that you contact your local Medicaid program to find out what they will pay.

Family and Home

When all other avenues are exhausted – tapping into the collective group of friends and family to help pay for any time of long-term care needed is a possible option.

Although we all understand that will not be the case for every family.

How Much Does Medicare Pay For Assisted Living?

Generally speaking, Medicare doesn’t cover assisted living, unfortunately. This is a big reason why some elderly parents refuse to move into an ALF when they don’t have the financial resources.

Like other health insurance plans, Medicare does not cover long-term care services. Therefore, Medicare does not pay for the cost of room and board or personal care in an assisted living facility.

Of course, if any of these costs are unfathomable for you then you may want to look into other options for your senior loved one. Options such as:

  • Using a home health care agency
  • Hiring a private home health aide

Read about what to look for in a home care aide.

What Is The Difference Between A Nursing Home and Assisted Living?

The biggest differences between nursing home and assisted living facilities is how much help the senior person needs and how much constant care they require from skilled staff.

Nursing homes are generally intended for seniors who need round-the-clock care or monitoring and/or medical care either 24/7 or most of the day. Whereas seniors in assisted living facilities are more independent and may only require occasional assistance for issues such as activities of daily living.

Read more details about their differences here.

Did We Answer Your Question About The Cost Difference Between Nursing Homes and Assisted Living Facilities?

There’s a lot of information to gather when you’re trying to make the best decision about choosing the right type of senior housing for yourself or senior loved ones.

We hope that we have provided you with some of that information.

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