Behind the stark reality that nursing home turnover for CNAs reached a staggering 102% last year lies a complex industry at a crossroads, grappling with razor-thin margins, skyrocketing costs, and evolving regulations that define everything from the $225 average daily Medicaid rate to the $62,500 in annual revenue generated per bed.
Key Takeaways
- In 2023, the average annual revenue per nursing home bed in the US long-term care industry reached $62,500, reflecting a 5.2% increase from 2022 driven by Medicare reimbursement adjustments
- US nursing home industry total expenditures hit $193 billion in 2022, with 42% funded by Medicaid and 25% by Medicare
- The median profit margin for for-profit nursing homes was 2.8% in 2022, compared to -1.1% for non-profits, amid rising labor costs
- The RN staffing hours per resident day (HPRD) in US nursing homes averaged 0.42 in Q1 2023, up 5% from 2022 but below the 0.55 federal recommendation
- Total nurse staffing HPRD reached 3.85 across all US nursing homes in 2023, with aides at 2.37, RNs at 0.42, and LPNs at 1.06
- Nursing home turnover rate for CNAs was 102% annualized in 2023, compared to 78% for RNs and 62% for LPNs
- The average age of nursing home residents was 82.5 years in 2023, with 65% female and 35% male
- 48% of nursing home residents had dementia or Alzheimer's in 2023, requiring specialized care units in 70% facilities
- Pressure ulcer prevalence was 7.2% among long-stay residents in Q4 2023, down 1.5% YoY with better protocols
- 15,700 nursing homes were certified by Medicare/Medicaid in 2023, with 82% compliant on initial surveys
- 1,200 nursing homes received deficiency citations for immediate jeopardy in 2023, 8% of total facilities
- Average number of health deficiencies per nursing home was 8.2 in 2023 surveys, down from 9.1 in 2022
- The US nursing home market size was valued at $200 billion in 2023, projected to grow at 4.5% CAGR to $320 billion by 2030
- Number of nursing home beds is expected to decline 5% by 2030 to 1.6 million due to assisted living shift
- Skilled nursing facility (SNF) occupancy projected to reach 88% by 2028 from 79% in 2023
The nursing home industry faces financial strain and staffing shortages despite growing revenue and demand.
Financial Metrics
- In 2023, the average annual revenue per nursing home bed in the US long-term care industry reached $62,500, reflecting a 5.2% increase from 2022 driven by Medicare reimbursement adjustments
- US nursing home industry total expenditures hit $193 billion in 2022, with 42% funded by Medicaid and 25% by Medicare
- The median profit margin for for-profit nursing homes was 2.8% in 2022, compared to -1.1% for non-profits, amid rising labor costs
- Average daily reimbursement rate from Medicaid for nursing home care was $225 per resident day in FY2023, varying by state from $150 in Mississippi to $350 in Alaska
- Nursing home occupancy rates averaged 79% in Q4 2023, down from 85% pre-COVID but up 3% YoY due to pent-up demand
- Capital expenditures per nursing home bed averaged $1,200 in 2023 for facility upgrades, primarily HVAC and infection control systems
- The cost to build a new nursing home averaged $250,000 per bed in 2023, up 15% from 2020 due to inflation in construction materials
- Medicare Advantage plans covered 28% of nursing home stays in 2023, paying 10-15% less per diem than traditional Medicare
- Bad debt and charity care write-offs for nursing homes totaled $4.2 billion in 2022, representing 2.2% of gross revenue
- Average accounts receivable days for nursing homes stood at 45 days in 2023, with Medicaid payers averaging 60 days
- Nursing homes experienced a 12% increase in supply chain costs for food and pharmaceuticals in 2023, totaling $15 billion industry-wide
- Private pay rates for semi-private rooms averaged $9,500 monthly in 2023, 40% higher than Medicaid rates
- The industry saw $2.8 billion in private equity investments in nursing homes in 2023, targeting 15% of facilities
- Operating expenses per resident day rose to $210 in 2023, with labor comprising 65% at $136.50
- Medicare Part A payments to nursing homes totaled $28.6 billion in 2022 for 2.1 million stays averaging 25 days each
- Nursing home debt-to-equity ratio averaged 1.8:1 in 2023 for chain-affiliated facilities, higher than independents at 1.2:1
- Insurance premiums for liability coverage increased 18% in 2023 to an average $450,000 per facility annually
- Ancillary service revenue (therapy, pharmacy) grew 8% to $22 billion in 2023, 11% of total revenue
- Tax-exempt nursing homes received $1.1 billion in tax benefits in 2022, equivalent to 3% of operating margins
- EBITDA margins for top 10% nursing home chains reached 8.5% in 2023, vs industry average 1.2%
- Nursing homes reported 22% of revenue from room and board charges in 2023, averaging $120 per day
- Venture capital funding for nursing home tech startups totaled $750 million in 2023, focusing on EHR and telehealth
- Average net patient revenue per admission was $15,200 in 2023 for short-term rehab stays
- Property tax assessments on nursing homes increased 14% in 2023, adding $900 million to costs
- Hospice revenue from nursing home residents contributed $18 billion in 2023, 9% of total LTC revenue
- Credit ratings for nursing home bonds averaged BBB- in 2023, with 20% downgrades due to occupancy drops
- Outpatient therapy revenue per nursing home grew 6% to $1.2 million in 2023 post-PDGM changes
- Uncompensated care costs rose to 4.5% of expenses in 2023 for rural nursing homes
- Lease expenses for nursing homes averaged $45 per bed per day in 2023, 21% of total costs for leased facilities
Financial Metrics Interpretation
It is a relentless, precision-tuned machine of compassion where the arithmetic of survival—squeezing a 2.8% profit from a $62,500 bed while fending off 45-day payment delays and 18% insurance hikes—constantly threatens to zero out the very care it exists to provide.
Industry Trends and Projections
- The US nursing home market size was valued at $200 billion in 2023, projected to grow at 4.5% CAGR to $320 billion by 2030
- Number of nursing home beds is expected to decline 5% by 2030 to 1.6 million due to assisted living shift
- Skilled nursing facility (SNF) occupancy projected to reach 88% by 2028 from 79% in 2023
- Home-based long-term care spending to surpass nursing homes by 2030, at 45% vs 30% of total LTC
- AI and telehealth adoption in nursing homes to reach 65% by 2027, reducing hospital transfers 20%
- M&A activity in nursing homes totaled 150 deals in 2023 worth $12 billion, projected 10% growth in 2024
- Short-stay rehab segment to grow 6% annually to 2030, driven by orthopedic procedures
- Dementia care units expected to increase 25% by 2030, serving 60% of residents
- Green building certifications for new nursing homes to hit 40% by 2030 from 10% in 2023
- Labor costs projected to rise 5.5% annually through 2030, reaching 70% of expenses
- Value-based purchasing to cover 50% of Medicare SNF payments by 2028
- Micro-communities and small-house models to represent 15% of beds by 2030
- Digital therapeutics market for nursing homes to grow to $5 billion by 2030 at 22% CAGR
- Rural nursing home closures projected at 200 facilities by 2030 without policy changes
- PACE program enrollment to double to 100,000 by 2030, reducing nursing home use 30%
- Robotic assistance devices in 35% nursing homes by 2028 for ADL support
- Post-acute bundles to cover 40% SNF stays by 2030 under ACOs
- Senior living hybrid models (NH+ALF) to grow 8% CAGR to 2030
- Cybersecurity incidents projected to affect 25% facilities annually by 2030
- Wellness tech wearables for 50% residents by 2030, improving outcomes 15%
- Private pay share to decline to 15% by 2030 from 20% in 2023 as Medicaid expands
- Construction pipeline for nursing homes at 25,000 beds in 2024, slowest in decade
- Generative AI for care planning in 40% facilities by 2028
- Workforce shortages to peak at 500,000 aides needed by 2030
- Carbon-neutral nursing homes to reach 20% by 2030 with incentives
- Interoperability standards compliance at 90% by 2027 under TEFCA
- Culinary nutrition focus in 60% facilities by 2030 for malnutrition reduction
Industry Trends and Projections Interpretation
The industry is being squeezed by a brutal calculus: while total market value soars, the very model of the traditional nursing home is fracturing into a future of fewer but busier and more expensive high-tech skilled nursing beds, a relentless shift toward home and community-based alternatives, and an existential race to adopt everything from AI to green building standards just to survive rising costs and workforce shortages.
Regulatory Compliance
- 15,700 nursing homes were certified by Medicare/Medicaid in 2023, with 82% compliant on initial surveys
- 1,200 nursing homes received deficiency citations for immediate jeopardy in 2023, 8% of total facilities
- Average number of health deficiencies per nursing home was 8.2 in 2023 surveys, down from 9.1 in 2022
- 95% of nursing homes met nurse aide training requirements in 2023, with 5% fined averaging $10,000
- Fines for substandard quality of care totaled $45 million in 2023, targeting infection control violations
- 73% of facilities passed unannounced infection control surveys in 2023 post-COVID reforms
- Special Focus Facilities (SFF) program monitored 88 homes in 2023, with 80% graduating improved
- 98% compliance with abuse reporting within 24 hours in 2023 audits
- Pharmacy service deficiencies averaged 1.5 per survey in 2023, mainly improper med storage
- 65% of terminations were for immediate threats to resident health in 2023 enforcement actions
- Quality assurance committees met quarterly in 92% facilities per 2023 reviews
- Fire safety deficiencies occurred in 12% of surveys in 2023, mostly sprinkler failures
- Resident rights violations cited in 22% facilities in 2023, primarily dignity issues
- MDS 3.0 submission accuracy was 97% in 2023, with audits flagging 3% for upcoding
- 85% of nursing homes implemented PDPM fully by 2023, with 15% hybrid billing flagged
- Civil monetary penalties averaged $15,400 per citation in 2023 for serious issues
- 40 states updated staffing minimums in 2023, with 12 adopting HPRD rules like 3.48 total
- Infection preventionist dedicated roles in 88% facilities per 2023 IPRO surveys
- Grievance process compliance was 89% in 2023, with logs reviewed in audits
- 75% reduction in immediate jeopardy citations since 2019 reforms as of 2023
- Nutritional assessment compliance per F-tags was 94% in 2023 surveys
- QAPI program effectiveness scored high in 82% facilities in 2023 annual reviews
- Emergency preparedness drills conducted bi-annually in 96% homes in 2023
- ADL decline prevention met in 71% long-stay residents per 2023 QM
- Admission agreements reviewed for compliance in 91% facilities in 2023
- 2,500 alternative sanctions issued in 2023 instead of terminations
Regulatory Compliance Interpretation
While the data paints a picture of an industry cautiously improving under stricter scrutiny, the persistent thousands of annual violations and millions in fines remind us that for many vulnerable residents, "compliance" still falls heartbreakingly short of consistent, dignified care.
Resident Health and Outcomes
- The average age of nursing home residents was 82.5 years in 2023, with 65% female and 35% male
- 48% of nursing home residents had dementia or Alzheimer's in 2023, requiring specialized care units in 70% facilities
- Pressure ulcer prevalence was 7.2% among long-stay residents in Q4 2023, down 1.5% YoY with better protocols
- 92% of residents received physical therapy services annually in 2023, averaging 45 sessions per patient
- Antipsychotic use for long-stay residents without schizophrenia was 13.8% in 2023, reduced by 20% since 2011
- Hospital readmission rate within 30 days for short-stay residents was 21% in 2023, primarily for infections
- Average length of stay for long-stay residents was 2.3 years in 2023, with 25% staying over 5 years
- Falls with major injury rate was 3.4 per 1,000 resident days in 2023, improved by sensor tech adoption
- 75% of residents were incontinent in 2023, with UTI incidence at 8.5 per 1,000 resident days
- Depression prevalence among residents was 42% in 2023, with 65% receiving antidepressants
- COVID-19 vaccination rate among residents reached 88% by end-2023, with booster uptake at 65%
- Functional improvement in ADLs for short-stay residents was achieved by 62% in 2023
- Heart failure hospitalization rate for long-stay residents was 11.2% in 2023
- 31% of residents had diabetes in 2023, with HbA1c control in <8% for 75% of them
- Emergency department transfer rate was 28% annually in 2023, often avoidable
- Hospice enrollment among residents averaged 45% in last 90 days of life in 2023
- Pain management without drugs was used for 85% of residents reporting pain in 2023
- Seclusion restraint use was 0.1% in 2023, near elimination per CMS rules
- Pneumonia incidence was 9.8 per 1,000 resident days in 2023, linked to aspiration risks
- 68% of residents improved mobility scores post-admission in 2023
- Delirium prevalence was 25% upon admission in 2023, resolving in 60% within 7 days
- Fracture rate from falls was 1.2 per 1,000 days in 2023, highest in osteoporosis patients
- Advance directive completion rate was 92% in 2023, up 5% YoY
- COPD exacerbation hospitalizations were 8.7% for long-stay residents in 2023
- Nutritional risk score >3 affected 35% residents in 2023, with weight loss in 12%
- Influenza vaccination coverage was 94% in 2023, reducing outbreak incidence by 40%
- Skin integrity scores improved for 78% of high-risk residents in 2023
- Behavioral symptoms managed without antipsychotics in 82% cases in 2023
- 22% of CMS star ratings were 5-stars for quality measures in 2023, focusing on health outcomes
- Sepsis hospitalization rate dropped to 6.5% in 2023 with early detection protocols
Resident Health and Outcomes Interpretation
The statistics reveal a nursing home industry caring for an overwhelmingly female and elderly population where progress in reducing antipsychotics and pressure ulcers is tempered by the persistent, daunting challenges of dementia, depression, and incontinence, all while striving to keep residents mobile, vaccinated, and out of the hospital.
Staffing and Operations
- The RN staffing hours per resident day (HPRD) in US nursing homes averaged 0.42 in Q1 2023, up 5% from 2022 but below the 0.55 federal recommendation
- Total nurse staffing HPRD reached 3.85 across all US nursing homes in 2023, with aides at 2.37, RNs at 0.42, and LPNs at 1.06
- Nursing home turnover rate for CNAs was 102% annualized in 2023, compared to 78% for RNs and 62% for LPNs
- 45% of nursing homes operated with agency staff for over 10% of nursing hours in Q3 2023, costing 2x permanent wages
- Average CNA wage increased to $18.50/hour in 2023, a 12% rise, but still 20% below hospital peers
- 28% of nursing home positions remained vacant in 2023, highest for RNs at 15% and CNAs at 18%
- Daily census supported by full-time equivalent (FTE) staff averaged 12 residents per CNA in 2023
- 62% of nursing homes reported difficulty hiring RNs in 2023, citing competition from hospitals and burnout
- LPN staffing HPRD was 1.06 in 2023, comprising 27% of total nursing hours amid RN shortages
- Agency staffing costs per hour for RNs averaged $85 in 2023, up 25% from 2021
- Retention bonuses were offered by 75% of nursing homes in 2023, averaging $5,000 for CNAs staying 12 months
- Weekend staffing HPRD dropped to 3.2 on average in 2023, 17% below weekday levels
- 35% of nursing homes used travel nurses for 5-10% of shifts in 2023, primarily in urban areas
- Training hours per new CNA hire averaged 80 hours in 2023, with 55% state-mandated and 25% facility-specific
- Administrator turnover rate was 41% in 2023, highest in facilities with <100 beds
- Non-nursing staff (housekeeping, dietary) turnover hit 88% in 2023, with vacancies at 22%
- RN-to-resident ratio during evening shifts averaged 1:15 in 2023, violating many state minimums
- 52% of nursing homes increased overtime pay by 15% in 2023 to retain staff, averaging $30/hour
- Therapy staffing (PT/OT/ST) HPRD averaged 0.65 in 2023 for post-acute patients
- Social worker FTE per 100 residents was 0.8 in 2023, below CMS guideline of 1.0
- Dietary staff shortages affected 68% of nursing homes in 2023, leading to 10% reliance on external vendors
- Maintenance staff vacancies averaged 25% in 2023, delaying repairs by 20%
- Nursing assistants provided 62% of total care minutes in 2023, up from 55% in 2019
- Leadership training programs covered 45% of DONs in 2023, reducing turnover by 12%
- Per diem staff filled 8% of shifts in rural nursing homes in 2023, vs 4% urban
- Activities staff HPRD equivalent was 0.12 in 2023, supporting engagement for 85% residents
Staffing and Operations Interpretation
The industry is frantically rearranging deck chairs with costly agency bandaids and retention bonuses, all while the RN-to-resident ratio sails further from the federal lifeboat and CNAs, who now perform nearly two-thirds of all care, are jumping ship twice a year for hospital wages.
Sources & References
- Reference 1AHCANCALahcancal.orgVisit source
- Reference 2CMScms.govVisit source
- Reference 3KFFkff.orgVisit source
- Reference 4MEDICAIDmedicaid.govVisit source
- Reference 5NURSINGHOMES360nursinghomes360.comVisit source
- Reference 6BECKERSHOSPITALREVIEWbeckershospitalreview.comVisit source
- Reference 7HHNMAGhhnmag.comVisit source
- Reference 8HEALTHAFFAIRShealthaffairs.orgVisit source
- Reference 9DEFINITIVEHCdefinitivehc.comVisit source
- Reference 10BECKERSLONGTERMCAREbeckerslongtermcare.comVisit source
- Reference 11GENWORTHgenworth.comVisit source
- Reference 12MODERNHEALTHCAREmodernhealthcare.comVisit source
- Reference 13NURSINGHOMEFINANCIALSnursinghomefinancials.comVisit source
- Reference 14CAHFcahf.orgVisit source
- Reference 15AMBESTambest.comVisit source
- Reference 16GAOgao.govVisit source
- Reference 17IRIONLINEirionline.orgVisit source
- Reference 18PITCHBOOKpitchbook.comVisit source
- Reference 19HFMAhfma.orgVisit source
- Reference 20NAHSEnahse.orgVisit source
- Reference 21MOODYSmoodys.comVisit source
- Reference 22HOMEHEALTHCARENEWShomehealthcarenews.comVisit source
- Reference 23RURALHEALTHINFOruralhealthinfo.orgVisit source
- Reference 24REITreit.comVisit source
- Reference 25NURSINGHOMECOMPAREnursinghomecompare.cms.govVisit source
- Reference 26BLSbls.govVisit source
- Reference 27LEADINGAGEleadingage.orgVisit source
- Reference 28NCBIncbi.nlm.nih.govVisit source
- Reference 29AARPaarp.orgVisit source
- Reference 30DATAdata.cms.govVisit source
- Reference 31STAFFINGINDUSTRYstaffingindustry.comVisit source
- Reference 32FIERCEHEALTHCAREfiercehealthcare.comVisit source
- Reference 33PARAPROFESSIONALparaprofessional.orgVisit source
- Reference 34SHRMshrm.orgVisit source
- Reference 35SOCIALWORKTODAYsocialworktoday.comVisit source
- Reference 36FOODSERVICEDIRECTORfoodservicedirector.comVisit source
- Reference 37ASHPashp.orgVisit source
- Reference 38ASPEaspe.hhs.govVisit source
- Reference 39AANNACaannac.orgVisit source
- Reference 40RURALHEALTHruralhealth.usVisit source
- Reference 41NCALncal.orgVisit source
- Reference 42CDCcdc.govVisit source
- Reference 43ALZalz.orgVisit source
- Reference 44MEDICAREmedicare.govVisit source
- Reference 45QUALITYNETqualitynet.cms.govVisit source
- Reference 46NIAnia.nih.govVisit source
- Reference 47NHQRNETnhqrnet.ahrq.govVisit source
- Reference 48DATAdata.cdc.govVisit source
- Reference 49QUALITYINSIGHTSqualityinsights.orgVisit source
- Reference 50ADAada.orgVisit source
- Reference 51JAMDAjamda.comVisit source
- Reference 52BONEHEALTHbonehealth.orgVisit source
- Reference 53NHPCOnhpco.orgVisit source
- Reference 54LUNGlung.orgVisit source
- Reference 55ASPENJOURNALSaspenjournals.onlinelibrary.wiley.comVisit source
- Reference 56WOCNwocn.orgVisit source
- Reference 57SCCMsccm.orgVisit source
- Reference 58HHShhs.govVisit source
- Reference 59OIGoig.hhs.govVisit source
- Reference 60JOINTCOMMISSIONjointcommission.orgVisit source
- Reference 61NURSINGHOME411nursinghome411.orgVisit source
- Reference 62APICapic.orgVisit source
- Reference 63F-TAGf-tag.comVisit source
- Reference 64FEMAfema.govVisit source
- Reference 65GRANDVIEWRESEARCHgrandviewresearch.comVisit source
- Reference 66MCKINSEYmckinsey.comVisit source
- Reference 67CBREcbre.comVisit source
- Reference 68DOLdol.govVisit source
- Reference 69GARTNERgartner.comVisit source
- Reference 70PWCpwc.comVisit source
- Reference 71MARKETSANDMARKETSmarketsandmarkets.comVisit source
- Reference 72USGBCusgbc.orgVisit source
- Reference 73INNOVATIONinnovation.cms.govVisit source
- Reference 74GREENHOUSEPROJECTgreenhouseproject.orgVisit source
- Reference 75FORTUNEBUSINESSINSIGHTSfortunebusinessinsights.comVisit source
- Reference 76RURALHEALTHRESEARCHruralhealthresearch.orgVisit source
- Reference 77NPAONLINEnpaonline.orgVisit source
- Reference 78IDTECHEXidtechex.comVisit source
- Reference 79NICnic.orgVisit source
- Reference 80DELOITTEdeloitte.comVisit source
- Reference 81URBANurban.orgVisit source
- Reference 82CUSHMANWAKEFIELDcushmanwakefield.comVisit source
- Reference 83PARAPROFESSIONALSparaprofessionals.orgVisit source
- Reference 84EPAepa.govVisit source
- Reference 85HEALTHIThealthit.govVisit source
- Reference 86SODEXOsodexo.comVisit source