Last updated 2026-07-23
TL;DR
An assisted living place is licensed housing that helps residents with daily tasks like bathing, meals, and medication, but it isn't the 24/7 skilled nursing care a nursing home provides. Medicare doesn't pay for the room-and-board cost. A group home is a related but separate license type, usually smaller, often serving IDD, mental health, recovery, or elderly populations under state-specific rules.
What is assisted living?
Assisted living is a licensed residential option for people who need help with daily activities like bathing, dressing, taking medication, and getting to meals, but who don't need round-the-clock skilled nursing. The National Institute on Aging describes it as housing for older adults who need some help with everyday tasks but want to keep as much independence as possible [1]. It sits in the middle of the long-term care spectrum. Independent living communities offer almost no hands-on care. Nursing homes provide skilled medical care around the clock. Assisted living is the in-between tier: private or semi-private rooms, staff on site, meals in a dining room, and a call system for help, without the nursing station and ventilators you'd find in a skilled nursing facility. The scale of the industry is bigger than most people assume. The CDC's National Study of Long-Term Care Providers counts residential care communities (the category that includes most assisted living) in the tens of thousands nationwide, with hundreds of thousands of licensed beds [2]. That number keeps growing as the population over 75 grows.
What is an assisted living facility?
An assisted living facility is the physical building and licensed operation where assisted living services happen. It's the legal entity your state's licensing agency regulates, more than a marketing label. Depending on the state, the same type of setting might be called an assisted living facility, a residential care facility, a personal care home, or an adult foster care home, and each of those labels can come with a different rulebook. Most states license assisted living under a tiered system based on how much care a resident needs. A basic tier might allow help with activities of daily living and medication reminders. A higher tier (sometimes called "enhanced" or "limited nursing") allows things like wound care or a resident who needs a wheelchair full time. Confirm with your state licensing agency which tier applies to the residents you plan to serve, because admission and retention rules change by tier. If you're comparing options for a family member, read the assisted living facility page for a breakdown of what different license tiers usually include, and see how that compares across states on assisted living facilities.
What is a group home?
A group home is a licensed residential setting, usually smaller than an assisted living facility, where a limited number of residents live together and receive supervision or support tailored to a specific population. Group homes serve people with intellectual and developmental disabilities (IDD), mental health conditions, substance use recovery needs, or, in some states, seniors who need help but don't need a large facility (adult foster care). Size is the biggest structural difference. Many group homes house somewhere between 3 and 10 residents, compared to assisted living facilities that can run from a handful of residents up to 100 or more. Group homes tend to look more like an actual house in a residential neighborhood, which is part of why zoning fights over group homes happen so often. Group homes for people with disabilities also get specific federal protection. The Fair Housing Act makes it illegal to treat a group home differently than any other single-family residence just because its residents have disabilities. HUD's guidance on the Fair Housing Act states that housing discrimination "because of a handicap" of a buyer, renter, or resident is unlawful under 42 U.S.C. § 3604(f) [3]. That statute is one of the main tools operators use when a city tries to block a group home through zoning.
What's the difference between assisted living and a nursing home?
| Level of care | Help with daily tasks, medication reminders | 24/7 skilled nursing, medical care | |
|---|---|---|---|
| Typical staff | Caregivers, med aides, care coordinator | RNs, LPNs, CNAs, physician oversight | |
| Setting | Apartment-style rooms, communal dining | Hospital-style rooms, nursing stations | |
| Regulator | State assisted living/residential care licensing agency | State health department, CMS certification | |
| Payer mix | Mostly private pay, some state Medicaid waivers | Medicare (short-term), Medicaid (long-term), private pay | Some buildings run both license types under one roof in separate wings, which confuses families. If a facility's marketing calls itself "assisted living" but the resident needs a feeding tube managed daily or IV medication, that's usually a nursing home level of care, not assisted living. |
Assisted living helps with daily living tasks and social support. A nursing home (also called a skilled nursing facility) provides 24-hour medical care from licensed nurses, for people recovering from surgery, managing complex medical conditions, or needing rehabilitation. Medicare's Care Compare tool distinguishes nursing homes specifically because they're certified to provide skilled nursing and rehabilitative services under Medicare and Medicaid rules [4]. The staffing tells the story. Assisted living facilities typically staff caregivers and a resident care coordinator, with a nurse on call or visiting periodically. Nursing homes are required to have licensed nursing staff on site around the clock and a physician available for medical oversight. That's why nursing homes cost more, and why the entry criteria are stricter (a resident usually needs a documented medical need for skilled care to qualify). | Feature | Assisted living | Nursing home |
What does assisted living provide day to day?
Assisted living generally provides help with what regulators call activities of daily living: bathing, dressing, toileting, mobility, and eating. On top of that, most facilities provide three meals a day, housekeeping, laundry, medication management, social and recreational activities, transportation to appointments, and staff available on site 24 hours a day for emergencies. What it usually does not provide is skilled nursing care, physical therapy as a covered daily service, or complex medical treatment. A resident who needs daily insulin injections, wound vac management, or IV antibiotics typically needs a higher license tier or a nursing home, depending on the state's rules for what assisted living staff are permitted to do. The industry group AHCA/NCAL, which represents thousands of assisted living and skilled nursing providers, publishes staffing and service benchmarks that many state licensing rules borrow from directly [5]. If you're researching a facility for a family member, ask for the specific list of included services in writing. "Personal care" means something different in every state, and it's often defined precisely in the licensing statute, more than the brochure.
Does Medicare cover assisted living facilities?
No. Medicare does not cover the cost of room and board at an assisted living facility, and it doesn't pay for custodial care (help with bathing, dressing, or supervision) as a standalone benefit. Medicare's own guidance on long-term care explains that "most long-term care is not medical care, but rather help with basic personal tasks of everyday life," sometimes called activities of daily living, and that kind of care generally isn't covered [6]. Medicare Part A and Part B can still pay for specific medical services a resident receives while living in assisted living, things like doctor visits, physical therapy ordered by a physician, or a short skilled nursing facility stay after a qualifying hospital stay. But the rent, the caregiving staff, and the meals are the resident's or family's responsibility. Medicaid is a different story, though still limited. Many states use Medicaid Home and Community-Based Services (HCBS) waivers to pay for the care component of assisted living for people who qualify financially and medically. Medicaid.gov describes HCBS as programs that "provide opportunities for Medicaid beneficiaries to receive services in their own home or community rather than institutions or other isolated settings" . Even where a waiver exists, it typically still excludes room and board, and availability depends entirely on the state and often has waiting lists. Confirm with your state Medicaid agency whether assisted living services are covered under a waiver, and what income and asset limits apply.
How do you start a group home?
Starting a group home is a licensing project first and a business project second. Skip the license research and you'll waste money on a property or a business plan that doesn't match what your state actually allows. Here's the rough sequence most operators follow, though the order shifts by state: 1. Decide who you'll serve (IDD, mental health, recovery, seniors) since that determines which state agency licenses you and which rules apply. 2. Contact your state's licensing agency directly to get the current application, required policies, and staffing rules. Requirements and fees vary by state, so confirm with your state licensing agency rather than relying on generic checklists. 3. Form a business entity (LLC or corporation) and get an EIN from the IRS, which is free and done online . 4. Find a property that meets zoning, fire code, and bedroom/bathroom ratio requirements for your license type. See the section on zoning below before you sign a lease. 5. Write your policy and procedures manual: admissions, medication management, emergency plans, staffing, grievance procedures, and resident rights. Licensing agencies typically require this in writing before they'll schedule an inspection. 6. Hire and background-check staff, and complete any required training hours. 7. Submit your application, pay licensing fees, and schedule the pre-opening inspection. 8. Apply for a Medicaid provider agreement if you plan to accept Medicaid-funded residents, which is a separate process from state licensing in most states. The U.S. Small Business Administration's basic 10-step business guide is a decent generic framework for the business side (structure, licenses, funding, taxes), even though it isn't specific to group homes . The licensing side is the part that trips people up, since every state writes its own rules for staff-to-resident ratios, square footage per resident, background check depth, and required policies. If you'd rather not draft that policy manual from scratch, the $299 State Group Home Licensing Kit at /licensing-kit-builder builds a state-specific packet of application checklists and policy templates, which can save the weeks most first-time operators spend guessing what their state actually wants to see.
What staffing and paperwork does a group home need?
Staffing rules vary sharply by state and by population served, but nearly every state requires a minimum staff-to-resident ratio at all hours, documented staff training (often including CPR, first aid, medication administration, and abuse reporting), and criminal background checks or fingerprinting for anyone with resident contact. Paperwork is where applications actually get rejected or delayed. Expect to submit, at minimum: a policy and procedures manual, an emergency and disaster plan, a staffing plan with job descriptions, proof of liability insurance, floor plans showing exits and bedroom sizes, and individual resident care plan templates. Some states also require a criminal background check for the business owner and any household members living on site, more than employees. Budget real time for this. Licensing timelines vary by state, and a first-time application with an incomplete policy manual can add weeks or months to the process. Nobody publishes reliable national data on average approval times because every state agency reports differently, so ask your specific licensing office for their current processing window rather than trusting an average you find online.
Where can a group home or assisted living facility legally operate?
Zoning is the most common reason a good group home plan stalls before it opens. Most residential zones allow single-family homes but restrict group living arrangements, so a group home for people with disabilities can look, on paper, like it's banned from an entire neighborhood. The Fair Housing Act limits how far a city can push that. Group homes for people with disabilities generally have to be treated like any other family for zoning purposes, and outright bans or unusually strict spacing requirements between group homes have been challenged successfully under the Act in federal courts. HUD's Fair Housing Act enforcement page is the primary reference for how this protection works and what counts as illegal discrimination against housing for people with disabilities [3]. That protection isn't unlimited, though. Cities can still enforce genuinely neutral rules like fire code, occupancy limits tied to square footage, and parking requirements, as long as those rules apply evenly and don't specifically target group homes. Before signing a lease, confirm with your state licensing agency and your local zoning or planning department whether the specific address is zoned for your license type, and get that confirmation in writing if you can. For a broader look at how licensing and zoning interact by state, see assisted living and facility assisted living.
What happens during a licensing inspection?
A licensing inspection checks whether the physical building, staffing, and paperwork match what your application promised, and whether residents are actually safe. Inspectors typically review life safety items (fire extinguishers, exits, smoke detectors, evacuation plans), staff files (background checks, training records, timesheets), medication storage and administration logs, and resident files (care plans, incident reports, admission agreements). Most states also do unannounced follow-up inspections after the facility is licensed and operating, often annually, plus complaint-driven inspections if a family or staff member reports a concern. Deficiencies get written up with a required correction timeline. Repeated or serious deficiencies (medication errors, inadequate staffing, abuse allegations) can lead to fines, conditional licenses, or in serious cases, license revocation. The operators who pass inspections cleanly are almost always the ones who treat the policy manual as a living document, not a file they wrote once for the application and never opened again. If your medication administration log doesn't match your actual practice, that's the kind of gap an inspector catches in minutes.
Assisted living vs. group home vs. nursing home: a side-by-side comparison
| Feature | Group home | Assisted living facility | Nursing home | |
|---|---|---|---|---|
| Typical size | 3 to 10 residents | Roughly 10 to 100+ residents | Often 50 to 150+ residents | |
| Who it serves | IDD, mental health, recovery, or adult foster care for seniors | Seniors needing help with daily tasks | People needing 24/7 skilled medical care | |
| Setting | Often a converted single-family home | Purpose-built apartment-style facility | Hospital-style facility | |
| Staffing | Direct support staff, house manager | Caregivers, med aides, care coordinator | RNs, LPNs, CNAs, physician oversight | |
| Regulator | State disability, mental health, or aging services agency (varies by state) | State assisted living/residential care licensing agency | State health department, CMS certification | |
| Typical payer | State Medicaid waiver, private pay, SSI in some models | Mostly private pay, limited Medicaid HCBS waivers | Medicare (short-term rehab), Medicaid (long-term), private pay | The honest takeaway: these are three different regulatory worlds, even when the buildings look similar from the street. A group home license doesn't let you provide nursing-home-level medical care, and an assisted living license doesn't automatically let you accept the population a group home serves. Pick the license type that matches the residents you actually want to serve, then build the property and staffing plan around that, not the other way around. |
Frequently asked questions
Is assisted living the same as a nursing home?
No. Assisted living helps residents with daily tasks like bathing and medication reminders, while a nursing home provides 24-hour skilled nursing care from licensed nurses for people with more complex medical needs. Medicare's Care Compare tool treats them as separate, distinctly certified facility types with different staffing and regulatory requirements.
What's the difference between assisted living and a group home?
Assisted living usually serves seniors in a larger, apartment-style facility. A group home is typically smaller (often 3 to 10 residents), looks more like a house, and often serves people with intellectual/developmental disabilities, mental health conditions, or recovery needs, though some states use group home licenses for senior adult foster care too.
Does Medicaid pay for assisted living?
Sometimes, but only the care portion, not room and board, and only in states that offer it through a Medicaid Home and Community-Based Services (HCBS) waiver. Eligibility depends on income, assets, and medical need, and many states have waiting lists. Confirm current coverage and eligibility with your state Medicaid agency directly.
Does Medicare cover assisted living facilities?
Medicare does not cover assisted living room and board or custodial personal care. It may cover specific medical services delivered there, like doctor visits or physician-ordered therapy, and a short skilled nursing facility stay after a qualifying hospitalization, but not the ongoing cost of living in assisted living.
How much does assisted living cost per month?
Genworth's Cost of Care Survey put the national median assisted living cost around $5,350 a month, compared to roughly $8,669 for a semi-private nursing home room and $9,733 for a private room. These are national medians only; actual cost varies widely by state, region, and level of care needed.
How do I start a group home?
Decide which population you'll serve, contact your state's licensing agency for current requirements, form a business entity, find a compliant property, write your policy and procedures manual, staff and background-check your team, then submit your application and pass the pre-opening inspection. Requirements and fees vary significantly by state.
What licenses do I need to open an assisted living facility?
At minimum, you'll need a state assisted living or residential care license from your state's licensing agency, a business entity registration, an EIN from the IRS, and often a separate Medicaid provider agreement if you plan to accept Medicaid-funded residents. Confirm the exact license tier and paperwork with your state licensing agency before signing a lease.
What's the difference between assisted living and independent living?
Independent living is housing for seniors who don't need regular help with daily tasks, essentially an age-restricted apartment community with amenities. Assisted living adds licensed staff who help with bathing, dressing, medication, and mobility. Independent living communities usually aren't subject to the same clinical licensing requirements as assisted living.
Can a group home serve seniors instead of people with disabilities?
Yes, in many states a group home license (often called adult foster care or adult family home) is specifically built for a small number of seniors who need help but don't want or need a large assisted living facility. The license name and rules for this vary a lot by state.
How long does it take to get a group home or assisted living license approved?
There's no reliable national average because every state agency reports timelines differently, and it depends heavily on how complete your policy manual and staffing plan are at submission. Incomplete applications and unfinished property inspections are the most common causes of delay. Ask your specific state licensing office for their current processing window.
Do assisted living staff need medical training?
Most states require basic training like CPR, first aid, medication administration, and abuse/neglect reporting for direct care staff, but assisted living staff generally aren't required to be licensed nurses. Higher-tier assisted living licenses or memory care units sometimes require additional training hours. Requirements are set by each state licensing agency.
What is memory care, and is it different from assisted living?
Memory care is a specialized form of assisted living for residents with Alzheimer's disease or other dementias, usually with a secured unit, higher staff ratios, and staff trained specifically in dementia care techniques. It's typically licensed as a distinct unit or add-on within an assisted living license, not a separate license type in most states.
Do zoning laws stop me from opening a group home in a residential neighborhood?
Generally, no, not outright. The Fair Housing Act requires group homes for people with disabilities to be treated like any other family household for zoning purposes, which blocks most attempts at outright bans. Cities can still apply neutral rules like fire code and occupancy limits, so confirm zoning compliance with your local planning department before signing a lease.
Sources
- National Institute on Aging (NIH): Definition of assisted living as housing for older adults needing help with daily activities but not full nursing care
- CDC, National Study of Long-Term Care Providers: National count of residential care/assisted living communities and licensed beds
- Medicare.gov, Long-Term Care coverage page: Medicare does not cover long-term custodial care such as help with daily living activities
- Medicaid.gov, Home & Community Based Services: Medicaid HCBS waivers allow beneficiaries to receive services in the community rather than institutions, sometimes covering assisted living services but not room and board
- Genworth Cost of Care Survey: National median monthly costs for assisted living, nursing home semi-private and private rooms, and adult day health care
- Internal Revenue Service: Businesses can apply for a free EIN online through the IRS