Last updated 2026-07-23
TL;DR
Assisted living is state-licensed housing that helps people with daily tasks like bathing, dressing, and medication reminders. A nursing home provides 24-hour skilled nursing, rehab therapy, and medical management under federal certification rules. Nursing home care costs more ($8,669 to $9,733 a month, per Genworth's 2023 survey) than assisted living ($5,350). Medicare covers neither as long-term housing, only short rehab stays.
What is assisted living?
Assisted living is a licensed residential option for people who need help with daily tasks like bathing, dressing, taking medication, or getting to meals, but who don't need round-the-clock skilled nursing care. It's the middle rung on the care ladder. Independent living sits below it (amenities, no real care). Skilled nursing sits above it (doctors, RNs, IV lines, rehab gyms). Assisted living lives in the middle: private or semi-private rooms, staff on-site 24 hours a day, help with what clinicians call activities of daily living (ADLs), plus meals, housekeeping, and some social programming. Every state licenses this category differently, and some states don't even use the term "assisted living." You'll see "residential care facility," "personal care home," "adult care home," or "community-based residential facility" depending on where you are. That patchwork matters if you're trying to open one: staffing, training hours, and building requirements are set state by state, not federally, so confirm the exact category and rules with your state licensing agency before you assume anything carries over from a neighboring state. The federal government tracks the broader category loosely as "residential care communities." The CDC's National Center for Health Statistics counted roughly 28,900 of these operating nationwide as of 2020 [1], a number that spans everything from four-bed converted houses to 200-unit campuses.
What is an assisted living facility?
An assisted living facility is just the physical, licensed version of assisted living: the building and the operating license together. People use "assisted living," "assisted living facility," and "assisted living community" pretty much interchangeably in everyday speech, and honestly the industry itself isn't consistent about it either. What actually distinguishes one facility from another isn't the name on the sign. It's the size, the population served, and the state license category attached to it. A small assisted living facility might have six residents in a converted house. A large one might have 150 apartments, a memory care wing, and a full activities calendar. Both can carry the exact same state license type. When you're comparing assisted living facilities as an operator or as a family member, ask about the license category first, then the size and staffing second. Two facilities licensed under different state categories (say, a basic personal care license versus an enhanced assisted living license that allows for higher acuity residents) can have very different staffing rules even if they look identical from the parking lot.
What is a group home?
A group home is a small residential setting, usually a single house or small building, where a set number of people live together and receive support tailored to a specific population. That population could be adults with intellectual or developmental disabilities (IDD), people managing mental illness, people in addiction recovery, or seniors who need help but not a large facility. Most group homes house somewhere between 4 and 10 residents, though the number allowed is set by state licensing rules and sometimes by local zoning too. Here's the part people mix up: a senior group home and an assisted living facility often end up being the same license category in practice, especially in states that license smaller "residential care homes" for older adults. Meanwhile, an IDD group home is usually licensed by a completely different state agency (often the state's developmental disabilities agency, not the health department), and a mental health group home might fall under behavioral health licensing. The word "group home" describes the housing model, not a single regulatory category. Group homes serving people with disabilities also get specific legal protection. The Fair Housing Act treats a group home as a reasonable accommodation request in most residential zoning districts, meaning cities generally can't ban them outright just because neighbors object . Local zoning can still regulate spacing, occupancy, and safety, so that protection isn't unlimited, but it's the baseline federal backstop operators lean on when a zoning fight comes up.
What is the difference between assisted living and a nursing home?
| Regulated by | State licensing agency only | State agency, plus federal CMS certification for Medicare/Medicaid participation | |
|---|---|---|---|
| Level of care | Help with ADLs, medication reminders, some medication administration | Skilled nursing, wound care, IV therapy, rehab therapy, complex medical management | |
| Staff on-site | Caregivers 24/7; nurse hours required vary by state | RNs and LPNs on every shift, physician oversight required | |
| Typical resident | Needs help with 1 to 3 ADLs, mostly mobile | Needs 24-hour skilled nursing, often post-hospital or with a chronic illness | |
| Federal quality ratings | None (state inspection reports only) | CMS five-star Care Compare rating | |
| Medicare coverage | Not covered as housing (custodial care) | Up to 100 days of skilled nursing per benefit period, with conditions [2] | |
| Medicaid coverage | Usually only services via HCBS waiver, not room and board [3] | Mandatory Medicaid benefit for eligible adults [4] | |
| 2023 national median monthly cost | $5,350 [5] | $8,669 (semi-private) / $9,733 (private) [5] | That federal certification line matters more than people think. Nursing homes that accept Medicare or Medicaid have to meet requirements under 42 CFR Part 483, the federal nursing home regulations that came out of the Omnibus Budget Reconciliation Act of 1987 . Assisted living has no equivalent federal floor. Every rule an assisted living operator follows, from staff-to-resident ratios to medication administration limits, comes entirely from the state. |
The short version: assisted living helps with daily living tasks, a nursing home (also called a skilled nursing facility) provides actual medical and nursing care around the clock. One is regulated by your state alone. The other is regulated by your state and federally certified by CMS if it takes Medicare or Medicaid patients. | Feature | Assisted living | Nursing home (skilled nursing facility) |
What does assisted living provide day to day?
Assisted living generally provides help with bathing, dressing, toileting, and mobility, medication reminders (and in many states limited medication administration by trained staff), three meals a day plus snacks, housekeeping and laundry, transportation to appointments, and organized social activities. Staff are on-site 24 hours a day for safety and emergencies, but that's not the same as having a nurse on every shift. Most residents moving into assisted living need help with two to three ADLs, not full-time medical management. Industry data collected by the American Health Care Association / National Center for Assisted Living paints a fairly consistent picture nationally: residents skew female, tend to be in their 80s, and typically need support with bathing and dressing more than anything else [6]. What's not guaranteed is skilled nursing. If a resident develops a wound that needs daily clinical dressing changes, needs IV antibiotics, or needs a ventilator or feeding tube managed, most assisted living licenses don't cover that level of care, and the facility may have to discharge the resident to a nursing home. Staffing ratios, training hour minimums, and what counts as "medication administration" versus "medication assistance" differ by state, so confirm the specifics with your state licensing agency rather than assuming a national standard exists, because it doesn't.
What does a nursing home provide that assisted living doesn't?
A nursing home provides skilled nursing care delivered by RNs and LPNs on every shift, physician oversight, and clinical services assisted living isn't licensed to offer: wound care, IV medication, catheter care, tube feeding, ventilator management, and physical, occupational, and speech therapy delivered under a formal rehab plan. This is why nursing homes handle two very different populations. One group is short-term: people recovering from a hip replacement, stroke, or hospitalization who need intensive rehab for a few weeks before going home. The other group is long-term: people with advanced dementia, severe chronic illness, or disabilities requiring daily skilled nursing indefinitely. Because nursing homes accept Medicare and Medicaid, they're required to meet federal quality standards and get surveyed regularly by state inspectors on CMS's behalf. Those survey results feed into the public five-star rating system on Medicare's Care Compare tool , which families can use to compare specific facilities before choosing one. Assisted living facilities don't show up in that same federal rating system at all, since they're not federally certified in the first place.
Does Medicare cover assisted living facilities?
No. Medicare doesn't pay for assisted living, and it doesn't pay for long-term stays in a nursing home either. Medicare.gov states it plainly: "Medicare doesn't cover long-term care (also called custodial care) if that's the only care you need" [7]. What Medicare does cover is medical care wherever it happens. Doctor visits, some therapy services, and durable medical equipment can be covered under Part B regardless of the setting. And after a qualifying hospital stay of at least three days, Medicare Part A covers up to 100 days of skilled nursing facility care per benefit period, with no cost for days 1 through 20 and a daily coinsurance after that [2]. That benefit is for short-term rehab, not permanent housing. Medicaid is the more realistic long-term funding source, and it treats the two settings very differently. Nursing facility services are one of the mandatory benefits every state Medicaid program must cover for eligible adults [4]. Assisted living isn't a mandatory benefit anywhere. Most states instead use Home and Community Based Services (HCBS) waivers, often under Section 1915(c) of the Social Security Act, to pay for the personal care services delivered inside an assisted living setting, while the resident (or their family) still pays room and board out of pocket [3]. Waiver availability, income limits, and waitlists vary widely by state, so this is one to check directly with your state Medicaid agency rather than assume.
Which costs more, assisted living or a nursing home?
A nursing home costs noticeably more than assisted living, because you're paying for a much higher level of staffing and medical service, more than a room. According to Genworth's 2023 Cost of Care Survey, the national median monthly cost for assisted living was $5,350, compared to $8,669 for a semi-private nursing home room and $9,733 for a private room [5]. Those are national medians, and they hide a lot of state-by-state variance. Coastal metro areas routinely run well above those figures; some rural regions run below them. If you're pricing this out for a specific family member or a specific business plan, pull local rate data rather than relying on a national number, since the gap between states can run into the thousands of dollars a month. One more cost wrinkle worth knowing: assisted living pricing is often "tiered," meaning the base rate covers room, board, and basic help, and then additional ADL support (like two-person transfers or incontinence care) gets billed as an add-on. Nursing home rates are usually closer to all-inclusive for the nursing and rehab piece, though extras like private rooms or specialty therapy can still add cost on top.
Are assisted living and nursing homes regulated the same way?
No, and this is the single biggest structural difference between the two. Nursing homes that accept Medicare or Medicaid are federally certified by CMS and must meet the requirements in 42 CFR Part 483, the nursing home rules that came out of the 1987 Omnibus Budget Reconciliation Act . They get surveyed on a regular cycle, and survey results are public through Care Compare . Assisted living has no federal certification at all. It's regulated entirely at the state level, which is why the rules for a facility assisted living license in one state can look completely different from the next state over. Staff-to-resident ratios, required training hours, medication administration authority, physical plant requirements, even the terminology used, all of it is set by individual state statute and administrative code. For operators, that means there's no shortcut of "learning the federal rules once." Every state has its own licensing agency (usually a health department, department of social services, or a dedicated long-term care licensing division), its own application, and its own inspection checklist. Two states can license what looks like the identical business model in almost opposite ways.
How do you decide between assisted living and a nursing home for someone you love?
The real deciding factor is how many ADLs someone needs help with, and whether they need actual skilled nursing versus just support. Someone who needs help with two or three daily tasks, is still mostly mobile, and doesn't require ongoing clinical treatment usually does fine in assisted living. Someone recovering from surgery, managing a wound, needing IV medication, or living with advanced dementia and a real wandering or fall risk usually needs the higher staffing level a nursing home (or a licensed memory care unit) provides. A formal needs assessment from a doctor, discharge planner, or geriatric care manager is worth getting before making the call, because families often underestimate how much nursing support a loved one actually needs until an emergency forces the issue. If Medicare or Medicaid is paying for a rehab stay, the hospital's discharge planner will usually help sort this out directly. For comparing specific nursing homes, CMS's Care Compare tool lets you check a facility's staffing levels, health inspection history, and quality measures side by side. For assisted living, there's no equivalent federal database; you'll need to pull inspection reports directly from your state licensing agency and, for a broader search, tools like senior assisted living facilities near me can help narrow down options by location before you start calling.
How to start a group home (and what the licensing process actually involves)
Starting a group home, whether it serves seniors, people with IDD, mental health needs, or people in recovery, follows a similar sequence almost everywhere, even though the specific agency and paperwork differ by state. First, identify the exact license category and the agency that issues it. Senior-focused homes are often licensed by a state health or aging department; IDD homes by the state's developmental disabilities agency; mental health group homes by behavioral health licensing. Second, confirm zoning for your property, since group homes for people with disabilities get Fair Housing Act protection as a reasonable accommodation , but local occupancy and spacing rules still apply. Third, write your policies and procedures manual, covering medication management, emergency response, incident and abuse reporting, and admission and discharge criteria. Almost no state issues a license without this. Fourth, build a staffing plan that meets your state's specific ratio and training-hour requirements. Fifth, submit the license application, pay the required fee (amounts vary by state, confirm with your licensing agency), and schedule the pre-license inspection. Timelines vary a lot by state and by how complete your application is; some agencies move in a couple months, others take considerably longer, so build in a real cushion rather than assuming a fast turnaround. Writing a full policy manual and staffing plan from scratch is genuinely one of the slowest parts of this process for a first-time operator. That's the specific gap GroupHomePath's $299 State Group Home Licensing Kit is built to close: state-specific policy templates and staffing plan structure you customize to your exact license type, not a shortcut around your state's own review or a guarantee of approval. You can start building one at /licensing-kit-builder.
Frequently asked questions
What is assisted living?
Assisted living is a state-licensed residential setting for people who need help with daily tasks like bathing, dressing, and medication reminders, but not full-time skilled nursing care. It sits between independent living and nursing home care, with staff on-site 24 hours a day and rules that vary significantly by state.
What is a group home?
A group home is a small residential setting, usually a house with 4 to 10 residents, that supports a specific population such as people with IDD, mental illness, addiction recovery needs, or seniors. Depending on the population, it's licensed by a different state agency, so 'group home' describes a housing model, not one single license type.
What is an assisted living facility?
An assisted living facility is the licensed building and program that provides assisted living care. The term is used interchangeably with 'assisted living community,' and facilities range from small six-resident homes to large campuses with 100-plus apartments, all under the same broad state license category.
What is the main difference between assisted living and a nursing home?
Assisted living helps with daily living tasks and personal care; a nursing home provides 24-hour skilled nursing, physician oversight, and clinical treatments like wound care and IV therapy. Nursing homes are also federally certified by CMS if they accept Medicare or Medicaid, while assisted living is regulated by states only.
What does assisted living provide?
Assisted living typically provides help with bathing, dressing, and mobility, medication reminders, meals, housekeeping, transportation, social activities, and 24-hour staff availability for safety. It does not include skilled nursing services like IV therapy or ventilator management; those require a nursing home level of licensure.
Does Medicare cover assisted living facilities?
No. Medicare does not cover assisted living room and board because it's classified as custodial, long-term care, which Medicare specifically excludes. Medicare will cover medically necessary services like doctor visits wherever a person lives, and it covers up to 100 days of skilled nursing facility rehab after a qualifying hospital stay, but not ongoing assisted living costs.
Does Medicaid cover assisted living?
Medicaid rarely covers assisted living room and board directly. Most states instead use Home and Community Based Services (HCBS) waivers to pay for the personal care services delivered inside an assisted living facility, while the resident still pays for housing separately. Nursing facility services, by contrast, are a mandatory Medicaid benefit in every state.
How do I start a group home?
Identify your state's specific license category and issuing agency, confirm local zoning allows your intended population and home size, write a policies and procedures manual covering medication and emergency protocols, build a compliant staffing plan, then apply and pass a pre-license inspection. Templates like GroupHomePath's licensing kit can speed up the manual and staffing plan drafting, but every state still reviews and approves applications independently.
How long does it take to get a group home or assisted living license?
There's no single national timeline; it depends entirely on your state agency's caseload and how complete your application and policy manual are. Some agencies process applications in a couple of months, others take much longer, so confirm expected timelines directly with your state licensing agency before setting an opening date.
Can a nursing home resident move to assisted living instead?
Yes, if their care needs decrease enough that they no longer require 24-hour skilled nursing. Many people move from a nursing home rehab stay into assisted living once they've recovered mobility and no longer need daily clinical treatment, though the assisted living facility still has to be licensed and staffed to accept them.
What's the difference between assisted living and independent living?
Independent living is housing for seniors who don't need daily personal care, just amenities like meals and maintenance. Assisted living adds licensed staff support for ADLs like bathing and medication management. Independent living communities are typically not licensed as care facilities at all, while assisted living always requires a state license.
Is a senior group home the same as an assisted living facility?
Often, yes, in practice. Many states license small senior group homes under the same 'assisted living' or 'residential care' category used for larger facilities, just with a lower resident capacity. The regulatory requirements, not the size of the building, determine whether it's technically an assisted living facility.
What license do I need to open a group home?
It depends on who you plan to serve. Senior-focused homes usually need an assisted living or residential care license from a health or aging department; IDD homes need a license from the state's developmental disabilities agency; mental health or recovery homes typically need behavioral health licensing. Confirm the exact category with your state licensing agency before you sign a lease.
Sources
- Medicaid.gov, Mandatory & Optional Medicaid Benefits: Nursing facility services are a mandatory Medicaid state plan benefit
- Medicaid.gov, Home & Community Based Services: States use HCBS waivers to pay for personal care services delivered in assisted living settings
- Medicare.gov, Long-term care coverage: Medicare doesn't cover long-term custodial care if that's the only care needed
- Medicare.gov, Skilled nursing facility (SNF) care coverage: Medicare Part A covers up to 100 days of skilled nursing facility care per benefit period after a qualifying hospital stay
- CDC, National Center for Health Statistics: Roughly 28,900 residential care communities were operating in the U.S. as of 2020
- Genworth, Cost of Care Survey 2023: 2023 national median monthly costs for assisted living and nursing home care
- HUD, Fair Housing Act enforcement: Group homes for people with disabilities are treated as a reasonable accommodation under the Fair Housing Act
- Electronic Code of Federal Regulations, Title 42 Part 483: Federal nursing home requirements adopted under the 1987 Omnibus Budget Reconciliation Act