Nursing homes in the U.S. Nursing facilities across the United States are home to over 1.2 million
. They are cared for by a
comprising 1.3 million employees, with nursing assistants making up the largest segment at one-third of the total. However, despite the sizeable workforce, nursing homes face ongoing staffing challenges. In response, most nursing homes have implemented strategies to attract and retain staff, such as increased wages and strengthening workplace culture. Nevertheless, nearly 70 percent of nursing homes are still reporting
compared to pre-pandemic times. The persistent staffing shortages have led to concerns about facility closures, with roughly two-thirds of
Staffing challenges and federal mandates
Amongst the staffing challenges, there is growing concern over the staff to resident ratio and the amount of care each resident receives in nursing homes. Indeed, the average reported
nurse hours per resident day (HPRD) have been decreasing. The Biden administration proposed a staffing mandate that was finalized in April 2024, which specifies 2.45 nurse aide hours, 0.55 registered nurse hours, and 3.48 total HPRD. The large majority of U.S. nursing homes are currently not meeting the staffing requirements, with
for-profit nursing homes especially not measuring up. This shortfall is particularly concerning given that staff shortage is already a burning issue in the industry, with vacancies taking months to fill. However, with the incoming Trump administration, the staffing mandate may change or be dropped altogether.
How much do nursing homes cost?
In 2023, the median annual
cost for a private room in a nursing home was 116,800 U.S. dollars, while a semi-private room cost 104,025 U.S. dollars. These prices reflect the high cost of round-the-clock care provided. For those with less nursing care needs, assisted living facilities and home care services offer lower-cost options, with annual expenses ranging from 64,200 U.S. dollars for a single bedroom in an assisted living facility to 75,500 U.S. dollars for home health aide services.
Are nursing homes profitable?
Despite the high pricing, nearly half of
nursing homes were operating at a loss in 2024. Yet a study from 2023 found that 99 percent of nursing homes have disallowed expenses. When computing profit margins, disallowances—expenses that are prohibited by government payment policies, such as excess payments made over the fair market value of products and services—should not be included. When the 6.4 billion U.S. dollars in disallowance and 3.9 billion in non-cash depreciation expenses were excluded, the average
nursing home profit margin amounted to 8.84 percent. This shows that greater transparency is needed in the industry and nursing homes should be held accountable for their spending, especially when they are caring for the most vulnerable of society.
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