Is there a shortage of nursing homes? A comprehensive look at the senior care crisis

Oct 28, 2025 3 min read •

senior care long-term care healthcare

According to a 2024 report, over 770 nursing homes have closed since 2020, displacing tens of thousands of residents, a clear sign of systemic issues. The answer to "Is there a shortage of nursing homes?" is yes, but the root of the problem is more complex than just a lack of physical beds.

Quick Summary

Access to nursing home care is worsening due to a severe labor shortage that has forced many facilities to limit admissions, downsize, or close entirely. This problem is compounded by chronic underfunding and rising demand from an aging population, creating a national crisis.

Key Points

Critical Access Issue: The shortage is defined by a lack of available staffed beds, forcing facilities to limit new admissions, not necessarily a lack of physical capacity.
Core Driver: Staffing Crisis: A historic and exacerbated workforce shortage, driven by burnout and low wages, is the primary cause, leading to closed units and full facility closures.
Financial Strain: Chronic underfunding, especially low Medicaid reimbursement rates that fail to cover costs, puts immense pressure on facilities, contributing to closures.
Increased Demand: The rapidly aging U.S. population and the rising acuity of resident needs are escalating demand for long-term care services.
Emergence of 'Deserts': Facility closures have created 'nursing home deserts' in many rural counties, leaving seniors without local access to skilled care.
Alternative Options: A growing number of seniors and families are turning to alternatives like home health care, assisted living, and PACE programs.

The Senior Care Crisis: Understanding the Reality

While the United States has millions of licensed nursing home beds, the critical issue is the lack of staffed beds. The ongoing shortage is primarily a workforce crisis, where a severe lack of qualified caregivers prevents facilities from admitting new residents, closing units, or shutting down entirely. This impacts not only seniors but also hospitals needing to discharge patients requiring post-acute care.

Root Causes of the Nursing Home Access Problem

Several factors contribute to the crisis, exacerbated by the COVID-19 pandemic.

The Historic Workforce Shortage

Exodus of Caregivers: Over 229,000 caregivers have been lost since February 2020 due to burnout, heavy workloads, and health risks.
Recruitment Challenges: Facilities struggle to attract and keep staff despite wage increases, facing competition from other healthcare sectors. Nearly all providers find hiring difficult.
Federal Staffing Mandates: New mandates require more staff, which industry groups argue will cause further closures without financial support.

Financial Pressures and Underfunding

Medicaid Reimbursement: State Medicaid rates often do not cover the cost of care for the majority of residents who rely on it.
Rising Costs: Inflation and the expense of temporary staff strain budgets, leaving facilities with thin margins.

The Rising Demand for Senior Services

Demographic Shift: A growing elderly population increases the demand for long-term care, coinciding with a shrinking supply of facilities and workers.
Complex Care Needs: Residents often have complex medical conditions requiring high-level care, difficult for understaffed facilities.

The Creation of 'Nursing Home Deserts'

A severe consequence is the emergence of "nursing home deserts"—counties without skilled nursing care. This affects rural areas most, with 40 new desert counties since February 2020, 85% of which are rural.

Alternative Care Options

Families explore alternatives as nursing home access declines. Options vary based on needs and finances.


Feature	Nursing Home	Assisted Living	In-Home Care
Level of Care	24/7 skilled medical care, supervision	Assistance with daily activities (ADLs), medication management	Varies; from occasional help to 24/7 medical/non-medical
Setting	Institutional, medical facility	Residential, private apartments in a community setting	In the senior's own home
Cost	Typically highest, especially for private rooms	Varies widely, generally less than nursing homes	Varies significantly based on hours and services
Medicaid Coverage	Covers long-term care for qualifying individuals	Limited; typically only covers specific services, not room and board	Available through waivers (HCBS) in many states
Ideal for...	High-acuity medical needs, round-the-clock nursing care	Active seniors needing some support, social engagement	Seniors who prefer aging in place and have a lower need for constant medical care

The Path Forward

Addressing the shortage requires policymakers, providers, and communities. Solutions include:

Increasing Funding: Raising Medicaid rates to cover care costs and wages is vital.
Workforce Investment: Recruiting, training, and retaining caregivers through better pay, benefits, and conditions is essential.
Supporting Alternatives: Funding for home and community-based services helps seniors age in place.
Technological Integration: Technology can help manage with less staff and improve care.

Conclusion

The question, is there a shortage of nursing homes, highlights a systemic issue rooted in staffing shortages, underfunding, and rising demand, not just a lack of buildings. This limits access, causes long waits, and reduces options, particularly in rural areas. Understanding these causes and exploring alternatives like home health and assisted living is key. Solutions require supporting the workforce, modernizing funding, and embracing innovation. For more information, consult reports from organizations like the American Health Care Association (AHCA).

Frequently Asked Questions

The nursing home shortage is primarily a workforce crisis, not a shortage of buildings. Facilities lack the staff to care for residents, forcing them to limit new admissions or close wings. This labor issue is compounded by financial pressures from inadequate Medicaid funding and rising operational costs.

Staffing shortages stem from multiple factors, including low wages, demanding workloads, and burnout that were intensified by the COVID-19 pandemic. Many potential workers are drawn to less strenuous or higher-paying positions in other healthcare sectors.

Yes, many nursing homes have closed or downsized significantly since the pandemic. Since 2020, at least 774 nursing homes have shut down, displacing over 28,000 residents. This trend is particularly evident in rural areas, creating 'nursing home deserts'.

Alternatives to nursing homes include in-home care, assisted living communities, adult foster care homes, and specialized programs like the Program of All-Inclusive Care for the Elderly (PACE). Each option offers different levels of care and independence.

A 'nursing home desert' is a county where there are no skilled nursing care options available for seniors. Since 2020, 40 additional counties in the U.S. have become nursing home deserts, with most of these being rural communities.

Chronic underfunding from Medicaid, which covers care for a majority of nursing home residents, creates a major financial shortfall for facilities. The gap between reimbursement rates and the actual cost of care makes it difficult for facilities to operate sustainably and pay competitive wages.

As the U.S. population ages, the demand for long-term care services is rising dramatically. This increasing need, coupled with a shrinking workforce and facility closures, puts immense pressure on the remaining nursing homes and exacerbates the access crisis.

Yes, efforts include advocating for increased Medicaid reimbursement, exploring innovative care models like aging in place, and integrating technology to improve efficiency. However, the industry is also grappling with new federal staffing mandates that are viewed as challenging to implement without additional funding.

References

Medical Disclaimer

This content is for informational purposes only and should not replace professional medical advice. Always consult a qualified healthcare provider regarding personal health decisions.