Last updated 2026-07-24
TL;DR
A licensed assisted living facility is a state-regulated residence offering housing, meals, and help with daily activities (bathing, dressing, medication) for people who don't need nursing-home level medical care. Licensing rules, staffing ratios, and inspections vary by state. Medicare doesn't pay for room and board; Medicaid may help through HCBS waivers in most states.
What is assisted living?
Assisted living is a category of licensed residential care for adults, usually seniors, who need help with daily activities but don't require the round-the-clock skilled nursing you'd find in a nursing home. Think meals, medication reminders, bathing and dressing help, housekeeping, and social activities, all wrapped inside a state-regulated building with staff on site. Every state licenses this differently, and even the name changes. You'll see "assisted living facility," "residential care facility," "personal care home," "adult foster care," or "assisted living residence" depending on which state you're in. The federal government does not license assisted living at all. It's entirely a state function, which is why the rules for staffing, square footage, medication administration, and inspections can look completely different crossing a state line [1]. The Centers for Medicare & Medicaid Services (CMS) confirms this directly: "States are primarily responsible for regulation of assisted living and similar community-based residential care settings" [1]. If you're comparing two states' rules side by side, expect real differences in things like required staff-to-resident ratios, training hours, and even whether a facility can keep a resident who becomes bed-bound. For state-specific licensing steps, our assisted living guide breaks down what most states require before you can open your doors.
What is a group home?
A group home is a licensed residential setting, usually smaller than an assisted living facility, where a handful of people (often 4 to 10, though this varies a lot by state) live together and get support from paid staff. Group homes serve a range of populations: people with intellectual or developmental disabilities (IDD), adults recovering from mental illness or substance use, and in some states, seniors who need assisted living-level care in a home-like setting instead of an institutional building. The line between "group home" and "assisted living facility" gets blurry because states use these terms inconsistently. In some states, a small assisted living home with 6 beds is licensed under the same statute as a group home for adults with disabilities. In others, group homes fall under a completely separate licensing agency (often the state's Medicaid or disability services department) than assisted living facilities (usually licensed by the health department or department of aging). If you're trying to figure out which license you actually need, the population you plan to serve matters more than the building size. A home for seniors needing help with activities of daily living is assisted living. A home for adults with IDD receiving habilitation services is usually licensed as a group home or intermediate care facility, often billed through Medicaid under different rules entirely.
What is an assisted living facility?
An assisted living facility (sometimes called an ALF) is a licensed building, or set of buildings, where residents live in private or semi-private rooms or apartments and receive help with what's called "activities of daily living" (ADLs): bathing, dressing, toileting, transferring, eating, and continence care. Staff are on site, usually around the clock, though the required ratio of staff to residents varies by state and by shift. Most states require a facility to hold a specific operating license before admitting a single resident. That license process typically covers the physical building (fire safety, exits, room sizes), the operator's background (criminal history checks, sometimes a financial solvency review), a staffing plan, and a policy and procedures manual covering medication management, emergency preparedness, resident rights, and grievance procedures. A facility is also expected to have an admission agreement, a resident assessment process (to confirm the person's needs match what the facility is licensed to provide), and increasingly, disclosure of costs and services under state consumer protection rules. Some states cap the level of care an assisted living facility can offer. Once a resident needs skilled nursing care, memory care beyond what the license allows, or two-person transfers, the facility may be required to discharge them to a higher level of care.
What is assisted living vs nursing home?
| Licensing authority | State health/aging agency (varies) | State + federal (CMS) |
|---|---|---|
| Nurse on site required | Varies by state, often not mandatory | RN required 8 hrs/day, 7 days/week [2] |
| Medicare coverage | No (except limited short-term stays in some cases) | Yes, up to 100 days post-hospital under conditions [4] |
| 2023 median annual cost | $64,200 [3] | $116,800 (semi-private) [3] |
| Typical resident | Needs ADL help, mobile or semi-mobile | Needs daily skilled nursing/rehab |
The core difference is medical intensity. Assisted living is for people who need help with daily living tasks but not ongoing skilled nursing care. A nursing home (skilled nursing facility, or SNF) is for people who need daily medical care, such as wound care, IV therapy, ventilator support, or rehabilitation after a hospital stay, and it must have licensed nurses on site at all required times. Nursing homes are certified by CMS to accept Medicare and Medicaid payment and must meet federal requirements under 42 CFR 483.35, including a registered nurse on duty at least 8 consecutive hours a day, 7 days a week [2]. Assisted living facilities have no equivalent federal certification or staffing mandate. Their staffing rules come entirely from the state licensing agency, and "nurse required" rules differ widely. Some states require no licensed nurse on staff at all, only trained caregivers who can administer medication under state-specific delegation rules. Cost differs too. The median annual cost of assisted living was $64,200 in 2023 according to Genworth's Cost of Care Survey, versus $116,800 for a semi-private nursing home room and $132,900 for a private room [3]. Nursing homes cost more because of the higher staffing ratios and clinical services required. | Feature | Assisted living facility | Nursing home (SNF) |
What does assisted living provide?
Assisted living generally provides a private or semi-private room, three meals a day, housekeeping and laundry, help with ADLs, medication management or reminders, 24-hour staff availability, an emergency call system, and organized social or recreational activities. Beyond that baseline, what's included depends entirely on the state's licensing rules and the individual facility's service agreement. Many states require a written, individualized service plan for each resident, developed after an assessment, spelling out exactly which ADLs the resident needs help with and how often. This plan usually has to be updated on a set schedule, often every 6 to 12 months or after any significant change in the resident's condition, though the exact interval is set by each state's licensing agency. What assisted living does not typically provide: skilled nursing care, physical therapy as a covered service, ventilator or feeding-tube management in most states, and secure memory care unless the facility holds a separate memory care or "special care unit" license or endorsement. If you're researching options for a family member, check our assisted living facility and assisted living facilities guides for what specific services to ask about during a tour.
Does Medicare cover assisted living facilities?
No. Medicare does not pay for the room and board or personal care costs of assisted living. Medicare.gov states plainly that Medicare "doesn't cover room and board" for long-term care and that most nursing home and assisted living care isn't skilled care Medicare covers [4]. Medicare Part A can cover a short-term stay in a skilled nursing facility, not assisted living, following a qualifying hospital stay of at least 3 days, but this is capped at 100 days per benefit period and is meant for rehabilitation, not long-term residential care [4]. Medicaid is different. Most states offer Home and Community-Based Services (HCBS) waivers under Section 1915(c) of the Social Security Act that can help pay for the personal care and service costs in an assisted living setting, though Medicaid generally still won't cover the room and board portion [1]. Coverage, eligibility income limits, and which facilities accept Medicaid waiver residents vary heavily by state, so confirm with your state Medicaid agency and your state licensing agency before assuming coverage applies. Medicaid.gov's HCBS page confirms that states "can offer a variety of services" under these waivers, including personal care and case management, but implementation is state-specific [1].
How to start a group home
Starting a group home means securing a state operating license before you can accept a single resident, and the process typically runs through several stages: choosing your population and license type, meeting zoning requirements, passing a facility inspection, hiring qualified staff, and submitting a formal application with fees. First, decide who you're licensing to serve. States license differently for adult foster care, IDD group homes, mental health residential facilities, and senior assisted living, and the wrong license type means starting over. Contact your state's licensing agency (usually under the department of health, department of human services, or department of aging) to confirm exactly which license category fits your planned population. Second, check zoning. Many states have laws requiring group homes for people with disabilities to be treated the same as any other single-family residence under local zoning codes, following protections under the federal Fair Housing Act, but local permitting, occupancy limits, and fire code requirements still apply and differ by municipality. Confirm with your local zoning office before signing a lease or purchase agreement. Third, prepare your operational documents: a policy and procedures manual, an emergency preparedness plan, a staffing plan with job descriptions and training schedules, and financial documentation showing you can operate the home. Most states require background checks (often through the state's criminal history repository and a check against abuse/neglect registries) for the operator and all staff. Fourth, schedule your pre-licensing inspection. A state surveyor will walk through the physical building, checking fire exits, smoke detectors, sprinkler requirements, bedroom square footage per resident, bathroom-to-resident ratios, and kitchen sanitation. Fix any deficiencies before the follow-up inspection if one is required. Finally, submit your license application with the required fee. Fee amounts differ enormously by state; some charge under $500, others charge several thousand dollars depending on facility size, so confirm the current fee schedule with your state licensing agency. Processing times also vary; some states issue a license in a few weeks, others take several months, especially if your zoning or inspection needs corrections. Building all of this from scratch, the policy manual, staffing templates, inspection checklists, state-specific application steps, is the single biggest time sink for first-time operators. That's the exact gap our $299 State Group Home Licensing Kit is built to close: a state-specific packet of the forms, templates, and checklists you'd otherwise spend weeks assembling yourself. You can start building yours at licensing kit builder.
How do I start a group home? (Staffing and inspection basics)
Staffing is where most new operators underestimate the workload. States typically require a designated administrator or licensee-in-charge who meets minimum education or experience requirements (sometimes a specific number of hours of state-approved training, sometimes a degree in a health or human services field, depending on the state and license type). Direct care staff usually need a criminal background check, a health screening or TB test, and completion of initial orientation training within a set number of days of hire, again, state-specific. Ongoing staffing ratios (how many staff per resident on each shift) are one of the most commonly cited deficiencies in state inspection reports, because ratios have to hold up more than on paper but during an actual site visit. Build your staffing plan with realistic call-out and vacancy coverage in mind, more than the bare legal minimum. Inspections don't end at licensing. Most states conduct annual or biennial renewal inspections plus complaint-driven inspections triggered by a report to the state's abuse hotline or ombudsman. Keep your policy manual, training records, medication logs, and incident reports organized and current. These are the first documents an inspector asks for. Our inspections resources and assisted living at home guide cover what a typical inspection checklist looks like.
What is the difference between assisted living and nursing home care, in practice?
In day-to-day terms: assisted living residents generally get themselves to meals, manage most of their own mobility (with a walker or minimal assistance), and need help mainly with things like bathing, dressing, and remembering medications. Nursing home residents are more likely to be bedridden or need two-person transfers, have complex medical needs like wound care or IV medications, or need daily therapy services after a hospitalization. The regulatory difference matches the clinical difference. CMS requires nursing homes to have a registered nurse on duty for at least 8 consecutive hours every day and a licensed nurse (RN or LPN) on duty 24 hours a day [2]. Assisted living facilities have no such federal requirement, and state rules on nurse staffing range from "not required" to "must have an RN available on call" to "must employ an RN part-time," depending entirely on the state. Payment sources track this difference too. Nursing homes accept Medicare Part A for short, medically necessary rehab stays and Medicaid for long-term custodial care in every state, since nursing facilities are Medicaid-certified providers under federal law. Assisted living facilities are almost never Medicare-eligible providers, and Medicaid help typically flows through HCBS waivers rather than a direct per-diem Medicaid rate.
How much does licensed assisted living cost, and who pays for it?
The 2023 Genworth Cost of Care Survey put the national median cost of assisted living at $64,200 per year, or about $5,350 a month [3]. That's a national median; actual costs swing widely by state and by the level of care a resident needs, with add-on fees common for memory care, medication management, or higher ADL assistance tiers. Most residents and families pay out of pocket, at least initially, using savings, home sale proceeds, long-term care insurance, or in some cases, veterans' benefits like the VA's Aid and Attendance pension [5]. Medicaid HCBS waivers can help cover the service costs (not room and board) for financially eligible residents in states that include assisted living settings in their waiver programs, but availability, waitlists, and income eligibility limits differ by state [1]. Confirm current limits with your state Medicaid agency, since these figures change annually. For operators, understanding these payer dynamics matters because your admission agreements, private-pay rates, and any Medicaid waiver participation all need to be spelled out clearly in your policies before your first resident moves in.
Frequently asked questions
What is assisted living?
Assisted living is a licensed residential setting for adults who need help with daily activities like bathing, dressing, and medication management but don't need the full-time skilled nursing care of a nursing home. States, not the federal government, regulate assisted living, so the rules and even the name (residential care home, personal care home) differ by state.
What is a group home?
A group home is a smaller, licensed residential setting where several unrelated adults live together and receive support from paid staff. Group homes serve varied populations, including people with intellectual/developmental disabilities, mental illness, or substance use recovery needs, and licensing requirements depend on which population the home is licensed to serve.
What is an assisted living facility?
An assisted living facility is a state-licensed building where residents get private or semi-private housing, meals, help with daily activities, medication management, and staff supervision, typically around the clock. It must meet state-specific building, staffing, and policy requirements before it can legally admit residents.
What is the difference between assisted living and a nursing home?
Assisted living serves people who need help with daily activities but not ongoing medical care; nursing homes serve people who need daily skilled nursing or rehab services and must have a registered nurse on duty at least 8 hours a day under federal rule 42 CFR 483.35 (b). Nursing homes also cost roughly double, per Genworth's 2023 survey.
Does Medicare cover assisted living facilities?
No. Medicare does not pay for assisted living room and board or personal care costs, according to Medicare.gov. Medicare Part A may cover a short skilled nursing facility stay after a qualifying hospitalization, but that's a different setting and a different, capped benefit (up to 100 days), not ongoing assisted living.
How do I start a group home?
Start by deciding which population and license type fits your plan, then confirm zoning with your local government, prepare a policy manual and staffing plan, pass your state's pre-licensing building inspection, and submit your license application with the required fee to your state licensing agency. Timelines and fees vary widely by state.
What does assisted living provide that home care doesn't?
Assisted living provides 24-hour on-site staff, congregate meals, housekeeping, and a structured living environment, whereas home care sends an aide into a person's own home for scheduled hours. Assisted living also includes an emergency call system and organized social activities built into daily life.
Can Medicaid pay for assisted living?
In most states, yes, but only through Home and Community-Based Services (HCBS) waivers that cover personal care and service costs, not room and board, according to Medicaid.gov. Eligibility, waitlists, and which facilities accept waiver residents differ by state, so confirm current rules with your state Medicaid agency.
What's the average cost of assisted living per month?
Genworth's 2023 Cost of Care Survey found a national median assisted living cost of about $5,350 per month ($64,200 per year). Actual costs vary significantly by state, facility type, and level of care needed, with memory care and higher ADL support typically costing more.
Do assisted living facilities need a nurse on staff?
It depends on the state. Unlike nursing homes, which must have an RN on duty at least 8 consecutive hours daily under federal rule, assisted living facilities have no federal nurse staffing requirement, and state rules range from no nurse required to a mandatory part-time RN, so check your specific state's regulations.
What's the difference between a group home and an assisted living facility?
The difference is mostly about population and licensing category, not building size. Assisted living licenses generally target seniors needing help with daily activities, while group home licenses often cover people with intellectual/developmental disabilities or mental health needs, sometimes under a different state agency entirely.
How long does it take to get an assisted living or group home license?
Timelines vary enormously by state, ranging from a few weeks to several months, depending on how quickly your building passes inspection, whether zoning approval is needed, and how complete your initial application is. Contact your state licensing agency for its current average processing time.
Sources
- Medicaid.gov, Home & Community-Based Services: States are primarily responsible for regulating assisted living, not the federal government
- eCFR, 42 CFR 483.35: Nursing homes must have a registered nurse on duty at least 8 consecutive hours a day, 7 days a week
- Genworth, Cost of Care Survey 2023: Median 2023 assisted living cost and nursing home cost figures
- Medicare.gov, Skilled Nursing Facility (SNF) Care coverage: Medicare does not cover long-term room and board and covers SNF stays only under specific conditions up to 100 days
- U.S. Department of Veterans Affairs, Aid and Attendance benefits and Housebound allowance: VA Aid and Attendance pension can help veterans and survivors pay for assisted living costs