About 14.5% of Americans and 8.5% of people worldwide were age 65 or older in 2016. It's estimated that approximately 23.5% of U.S. adults will reach age 65 by 2060. Many seniors suffer from chronic diseases, disabilities and other health problems affecting their independence and quality of life. If you enjoy helping people and want to make a difference in your community, consider opening a nursing home.


Research the different types of nursing home facilities, choose your niche and obtain the necessary business licenses and permits. Make sure your staff is fully licensed and has experience working with elderly adults, especially those with special needs.

Research the Nursing Home Industry

Start by researching the nursing home industry and its evolution over the years. There are about 31,900 nursing care facilities in the U.S., with an annual revenue of $139 billion. The industry had a 2.1% growth rate per year between 2014 and 2019, as reported by IBISWorld. The number of older adults is expected to increase over the next decades, so the demand for nursing care facilities will grow as well.

Approximately 88% of adults who live in nursing facilities are over 65 years old. About 45% are older than 85. About 60% of the elderly population has two or more chronic disorders, such as diabetes, heart disease, Alzheimer’s or cancer, according to the Office of Disease Prevention and Health Promotion. Therefore, nursing homes must be properly equipped to provide medical services and emergency care.

Make sure you have a good understanding of the different types of nursing homes. Several business models exist, including hospice centers, nonprofit skilled nursing facilities, nonprofit nursing homes, for-profit nursing homes and more. About 70% of all facilities are operated by for-profit companies. Golden Living, Genesis HealthCare Corporation, HCR ManorCare and Kindred Healthcare Inc. are among the top providers in the U.S.

Find Your Niche

Decide what type of nursing home you want to open and what services it will provide. Nursing homes are facilities that provide 24/7 care to their residents. Some patients have special needs and require permanent monitoring and medical services. For example, some nursing home facilities offer medical care to seniors with Alzheimer's disease and other forms of dementia. Skilled nursing facilities will provide different services than a retirement home with nursing care.

Nursing homes typically appeal to elderly adults who can no longer live independently. Their residents have access to medical care and specialized staff who assist them with bathing, housekeeping, reading, exercise and other daily activities. Assisted-living programs, on the other hand, are ideal for seniors who don't need medical care and assistance around the clock.

Another option is enriched housing, a type of adult care facility that offers long-term residential services and personal care to seniors. Their services may include one to three daily meals, recreational activities, housekeeping and more. These establishments are licensed by the State Department of Health. Once you've decided on a business model, analyze the local market and your competition as well as any potential opportunities and threats.

Write a Business Plan

Make sure you have a solid business plan before opening a nursing home. Providing quality care requires skilled staff and modern equipment, which involves a large investment. Every detail matters, from beds and furnishings to information systems. Therefore, you need to consider the legal, financial and operational aspects of running this kind of business.

Draft a business plan that offers an in-depth overview of the industry and outlines your vision. Describe your short- and long-term goals, mission statement, target audience and competition. The financial part should include your revenue streams, startup costs, fixed and variable costs, financial projections and funding needs. You also need to develop a marketing strategy, which may include promotional activities like hosting an open house, launching online campaigns, setting up a referral marketing plan and so on.

Determine what services you will provide and who will be in charge of what. Make a list of suppliers that sell medical beds, wheelchairs, office supplies, bedding supplies and assistive devices; contact them and request multiple quotes. Include everything in your business plan and then assess the costs involved. Decide whether you need financing and reach out to investors, banks and state agencies offering grants and small business loans.

Requirements for Opening a Nursing Home

Next, register your nursing care business with the state. Ideally, form a limited liability company or a partnership. An LLC protects your personal assets, meaning that if you ever get sued or file for bankruptcy, you won't lose your home and other personal belongings. Furthermore, there is no limit on the number of members, and it's not necessary to form a board of directors as is the case with corporations.

Once you've decided on a business structure, file the necessary paperwork and prepare an operating agreement. Depending on the state of incorporation, you'll pay anywhere between $45 and $520 to register your LLC.

As soon as you complete this step, apply for a federal tax ID number online. Also, it's necessary to register your company with your state's revenue office so you can pay state and local taxes.

Get a Business License

All states require nursing home facilities to hold a valid license. The exact requirements vary from one state to another. For example, if you're planning to open a nursing home in Florida, you'll need a Nursing Home Administrator license from the state's Board of Nursing Home Administrators. A nursing home facility based in Texas will require a license from the state's Health and Human Services department, and all applications must be approved by the HHS Architectural Unit.

In addition to a business license, you may need to obtain certain permits before opening a nursing home. Fire department permits, signage permits and health department permits are just a few examples. Nursing home facilities provide their residents with daily meals and snacks. Therefore, they are legally required to obtain a permit from the local health department.

Make sure your staff is licensed too. Before hiring nurses, physiotherapists and other medical professionals, check their background and professional experience.

Start Bringing in Patients

A well-thought-out marketing plan is crucial, especially for nursing care facilities located in big cities. As a small business, you may lack the resources to hire a large PR agency. However, there are plenty of ways to promote your services on a budget. Start by setting up a website and listing your business on Google, Yelp, Bing, Yellow Pages, Apple Maps, Foursquare and other online directories.

Nearly 70% of adults ages 50 to 64 and 40% of those ages 65 and older use at least one social media platform. Therefore, it's worth advertising your services on Facebook, Twitter, YouTube and other social networks. Make videos and take photos of your facility, share relevant content related to assisted living and connect with prospective clients in local chat rooms, forums and Facebook groups.

Focus on building professional relationships in your community by networking with health care providers, physical therapists and social workers and letting them know about your facility. Send out press releases in local newspapers whenever you're launching a new service or hosting events at your nursing home. Attend medical conferences and other local events to promote your services and connect with potential clients and health care professionals.