How to Pay for a Nursing Home

Moving to a nursing home is about so much more than logistics. It’s an emotional, deeply personal decision. We know this can feel like a lot. It’s a big transition, and it’s completely normal to feel a mix of emotions – uncertainty, concern, even a bit of stress.

At the same time, you’re making an important decision about your care and your comfort – and that’s something to be proud of. You want to find the right care while also figuring out how you can pay for it.

It's true that nursing homes can be one of the more expensive types of aging care, but we’re here to let you know there are ways to make it work and you have options. With the right information you can plan for nursing home care with confidence.

Let’s take a look at how to pay for a nursing home so you can make the best decision for you. 

If you’re reading this article, you probably have a good idea of what a nursing home is, but we’ll lay out the definition here. 

Nursing homes are centers and communities for people who require round-the-clock skilled nursing care. They offer a range of services such as medical care, social engagement, rehabilitation, family support, and help you with the activities of daily living (ADLs) like dressing, eating, toileting, and bathing all in a residential setting for both short- and long-term stays.

America’s healthcare system relies on nursing homes to fill a special niche in the spectrum of aging care. Nursing homes are the highest level of care you can get without being admitted to a hospital and they typically provide care for you when you have a chronic illness or injury that prevents you from living at home. 

Planning for care at a nursing home is a big task that involves finding the right place and deciding on what kind of care you need. That’s all before you get to costs. Costs can vary depending on where you live, the type of room you’re looking for, and the level of care you need.

Based on the latest Cost of Care survey, in 2024, the national median monthly cost for a private room in a nursing home is $10,646. 

Nursing home care costs can vary by state. According to the latest Cost of Care survey here is a list of the top five most and least expensive states for nursing home care: 

Most expensive states for a private room in a nursing home (state monthly median cost):  

1. Alaska - $30,371 

2. Oregon - $17,094 

3. Washington, D.C. - $16,699  

4. Connecticut - $16,577 

5. Hawaii - $16,364 
    

Least expensive states for a private room in a nursing home (state monthly median cost):  

1. Texas - $7,087 

2. Missouri - $7,148 

3. Oklahoma - $7,604 

4. Louisiana - $7,604 

5. Arkansas - $7,711 

The short answer is no, Medicare does not typically cover the cost of long-term nursing home care. However, it may cover short-term skilled nursing care – things like physical therapy, speech therapy wound care, and administering medication – if you meet these conditions:  

• You’ve had a qualifying hospital stay of at least three days. 

• You need physical rehabilitation or skilled nursing care. 

• Your doctor certifies you need skilled care. 

If you do receive Medicare benefits for your nursing home stay, there are limits to how long you can receive them: 

• Full coverage for the first 20 days. 

• Partial coverage from days 21 to 100 (with a daily copay). 

• No coverage after 100 days. 

If you’re eligible, Medicaid will pay 100% of your nursing home costs. Most nursing homes accept Medicaid, but some don’t, so when you’re researching nursing homes, ask if Medicaid payments are accepted.

Each state has different income eligibility criteria for Medicaid, so it’s best to check your state’s requirements.  

One option to pay for nursing home care is through a long-term care insurance policy. Long-term care insurance covers care that’s, well, long-term like nursing homes, in-home care, assisted living communities, adult day-care, and memory care.

The general rule of thumb is to consider purchasing a policy around the age of 50, which is when you might begin planning for retirement. When you choose a long-term care policy, you’ll have different options. Here are some things to consider for your policy when paying for nursing home care: 

• Daily benefit amount: The amount of money your insurance company will pay per day for your care. 

• Coverage limits: The daily, monthly, and lifetime benefit caps on your policy as well as the benefits period. 

• Elimination period: The time you must wait after you qualify for benefits and before you start receiving payments.

You will also want to talk with your long-term care insurance provider or a financial planner to review the benefits provided under your policy. 

Many people use private funds to cover nursing home costs either entirely or in combination with long-term care insurance. Private funds can include: 

• Personal savings or retirement 

• Selling your home or using home equity 

• Financial support from family members 

• Investments and annuities 

By planning, you can prepare for the expensive cost of nursing home care and ensure you have access to care when you need it. Here are some steps you can take now: 

• Talk to a financial planner about long-term care savings. 

• Consider a long-term care insurance policy before you need care. 

• Consider Medicaid planning and spending down your assets. 

• Discuss care preferences with your family members. 

Paying for a nursing home can feel overwhelming, but it’s important to remember there are options. Whether you’re using Medicaid, personal savings, insurance, or veterans’ benefits, planning can help ease the stress of moving to a nursing home.

As you explore how to pay for a nursing home, consider reaching out to an advisor, attorney, or family member for personalized guidance on what’s right for you and your finances.