The most common payment methods for nursing homes include health care programs like Medicare and Medicaid, as well as private insurance. Eligible veterans and their spouses can also apply for veterans benefits to cover nursing home costs. However, most families need to supplement these options with private pay methods such as savings, retirement funds, life insurance, or long-term care insurance. There are many payment options to choose from, and in most cases, people use a combination of different sources.
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Medicare covers short-term nursing home stays, but it doesn’t cover long-term nursing care. This can be helpful for seniors needing short-term skilled nursing care or inpatient rehab, but it’s not a long-term solution.
Original Medicare fully covers the first 20 days of care in a nursing facility, then pays $204 each day for days 21-100. After that, coverage stops.[01] You can learn more about Medicare’s coverage on their site.
To reduce your costs, Martin Sbriglio, CEO of Ryders Health Management, a group of nursing homes in Connecticut, and licensed registered nurse, suggests adding Medigap to your Original Medicare plan.
“If you can afford it, it’s good to buy a supplemental policy,” Sbriglio says.
Medigap plans can help reduce your out-of-pocket costs, such as copayments, coinsurance, and deductibles that arise during the 100-day period of nursing home coverage.[02]
Sbriglio said that some families with a Medicare Advantage plan were unpleasantly surprised by their coverage. He cautions that the insurance companies that set up Medicare Advantage plans, sometimes known as managed Medicare, don’t always offer as much coverage as Original Medicare. Depending on the company offering Medicare Advantage, nursing home care may only be covered if the nursing home has a contract with your particular Medicare Advantage plan.[03]
Most, but not all, nursing homes accept Medicaid. Unlike Medicare, Medicaid pays for extended nursing home care if a person meets income and financial asset requirements. Many people don’t begin paying for a nursing home with Medicaid, but may need Medicaid in the future after exhausting their other payment options. Eligibility requirements differ by state, but the Medicaid site gives a helpful overview of general eligibility requirements.
To pay for nursing home care with Medicaid, you must choose a Medicaid-certified facility. It’s also important to note that nursing homes may limit the number of beds they offer to people paying with Medicaid, sometimes known as a “Medicaid bed.” Some facilities don’t limit the number of Medicaid beds they have, while others only have a few.[04]
To learn more about how to pay for nursing home care with Medicaid benefits, contact your state’s Medicaid office.
Private health insurance policies vary, but you can expect that most policies will only cover what’s medically necessary. When choosing a facility, ask the sales director if it’s possible to divide costs between medical care services and personal care services. Health insurance will most likely cover only the medical care services. Some examples of medical care services include:
Examples of personal care services include:
It’s best to consult your insurance policy and any nursing homes that you’re considering to make sure you have a clear understanding of your coverage.
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The U.S. Department of Veterans Affairs (VA) may provide long-term nursing care to qualified veterans and their spouses. Veterans and their spouses must already be signed up for VA health care and meet enrollment and eligibility requirements based on income, disability level, and location. In some cases, eligible veterans may qualify to live in specific VA nursing homes. Our Veterans Benefits Guide can help a senior determine if they qualify for senior care or nursing home coverage through the VA.
While benefits can often be put toward the cost of nursing home care or other long-term care options, it’s best to consult the VA department in your state or a recognized veterans service organization (VSO) for benefits counseling. Trained counselors can help you apply for every benefit you may be eligible for, and also guide you through the appeals process if necessary.
If your relative purchased a long-term care insurance plan earlier in their life, there’s a good chance you can receive funds to cover nursing home care costs. Most nursing homes are categorized as custodial care, and long-term care insurance is designed to pay for custodial care, as well as personal care.
“Long-term care insurance has gotten very expensive,” says Sbriglio, “but I do recommend it.”
Long-term care insurance policies can have high premiums, and not paying the premiums can often result in a loss of coverage. It’s also important to note that if a senior is already in a nursing home, it’s not possible to purchase a new plan. Many companies don’t sell policies to older seniors or seniors who already need care.
Life insurance offers another way to pay for a nursing home.
“If you [are] a couple, one or both should have separate life insurance [policies] with the other as beneficiary. That would help pay for long-term care needs,” says Sbriglio. “There’s so many new [policies] these days where it’s an investment as well as a life insurance benefit.”
If your loved one has a life insurance policy, you’ll want to read it carefully to find the best way to finance a nursing home. In many cases, seniors can convert a portion of their policy to help them pay for their care needs, while leaving the remainder of the policy as a death benefit.
Alternatively, seniors could sell the policy to a third party at market value or surrender their life insurance policy at cash value. Unfortunately, what seniors can expect to get in cash value is typically less than what they’ve invested over the years. However, it may be enough to help pay for their nursing home stay.
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Many seniors and their families are turning to savings and other private pay options to pay for a nursing home. As of 2023, the median cost for a private room in a nursing home increased to $116,796 per year.[05] For many families, this means that benefits alone won’t cover nursing home costs completely.
Sbriglio notes that with rising inflation, payment can be a pain point for many families. He recommends that people plan as early as possible for their future care needs.
The following are common options to help pay for a nursing home stay:
Nursing homes are the most expensive type of senior care because they provide the highest possible nursing care next to a hospital. This level of care might not be necessary, so you may want to discuss other care options with one of A Place for Mom’s Senior Living Advisors. They’ll ask questions to get a clear understanding of your loved one’s care needs and make recommendations in your area. You may want to consider assisted living or home care if your loved one doesn’t yet need 24-hour, hands-on nursing care.
Nursing homes cost an average of $8, 669 per month for a semi-private room, or $9, 733 per month for a private room. Where you live and the amount of care you need can also affect your monthly cost.
Medicare and Medicaid are the most common payment sources for nursing home care. However, Medicare’s nursing home coverage ends after 100 days in a skilled nursing facility. Medicaid doesn’t place a limit on the length of a senior’s stay, but you may have to wait for a Medicaid bed to be available.
The least expensive type of long-term care with 24-hour oversight is assisted living. The national median cost of assisted living is $4, 995 per month. However, your costs may differ depending on care needs, location, and room size. Compare options with our cost of long-term care report.
You can avoid paying your deceased mom’s nursing home bill if you didn’t sign their contract as the responsible party. Generally, your mom’s estate will be responsible for paying her bill. But, you may want to consult a lawyer if you’re concerned that you might be legally responsible.
Medicare. Skilled nursing facility care.
Medicare. Learn what Medigap covers.
Medicare. Nursing home care.
National Council on Aging. (2024, August 12). Does Medicaid pay for nursing homes? A comprehensive guide.
Genworth. (2022, June 2). Cost of care survey.
National Institute on Aging. (2022, November 2). Paying for long-term care.
Social Security Administration. (2024). Understanding the benefits.
National Association of Realtors. (2024, July 7). Quick real estate statistics.
The information contained on this page is for informational purposes only and is not intended to constitute medical, legal or financial advice or create a professional relationship between A Place for Mom and the reader. Always seek the advice of your health care provider, attorney or financial advisor with respect to any particular matter, and do not act or refrain from acting on the basis of anything you have read on this site. Links to third-party websites are only for the convenience of the reader; A Place for Mom does not endorse the contents of the third-party sites.
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