The term “nursing home” has been mistakenly thrown around as a popular “catchphrase,” however, few people have an understanding of the high level of care a traditional nursing home provides. The average person incorrectly labels any and all long-term care facilities a nursing home. This is not the case.
Nursing homes are for seniors who need daily medical intervention on an on-going basis. Such medical interventions include feeding tubes, IV’s and ventilators.
The large majority of seniors who need assistance do not need medical intervention on a daily basis like a nursing home provides. There’s been so much talk about getting into the nursing home business, many have thought about owning a nursing home franchise. While it sounds profitable and glamorous, there are huge downsides to owning one. The biggest is called Federal Regulations.
A nursing home franchise is heavily federally regulated and funded through CMS, the Centers for Medicaid, and Medicare. There is much complexity involved in being funded and receiving payment through these entities. Many nursing home franchise owners regret ever getting into the business. These small nursing home franchise business owners rarely see the payment issues before it’s too late.
Only a small fraction of families can afford to pay out-of-pocket for medical nursing home care. According to Genworth, the largest Long Term Insurance Company, the average cost of a private room in a nursing home is well over $105,000 per year, most are much higher.
Medicare may reimburse nursing home franchises for short-term rehabilitation cases, however recent changes in Medicare reimbursements can greatly affect the home’s profitability if they aren’t managed correctly. The Medicaid system pays nursing homes a highly reduced rate compared to Medicare or families who can afford to pay privately. This is because Medicaid is only a benefit for those who are financially indigent.
For entrepreneurs who feel the desire to be in the business of helping others, there is an alternative to a nursing home franchise with much more potential profitability. It’s called a residential assisted living franchise. A residential assisted living home, or sometimes called a senior care home, cares for seniors who can no longer care for themselves, but do not need the daily medical intervention that a nursing home provides.
A residential assisted living home is located in a residential neighborhood and is state-licensed to assist with the non-medical care of its residents. Most of them needing assistance in dressing, bathing, preparing meals, toileting, or may need memory care assistance. Residential Assisted Living homes can care for 6 to 16 residents depending on their state regulations. Most care homes for seniors are half the cost of a private nursing home.
There are no costly Federal Regulations to follow as residential assisted living homes are licensed by state health entities, not the federal government. Long Term Care Insurance pays for most residential care homes. Some do accept Medicaid, but the majority of them do not. Many more families can afford to pay privately to stay in a residential care home than a nursing home.
Majestic Residences offers a Residential Assisted Living Franchise that has been recognized by SeniorHousingNews.com as “One of the Five Senior Living Providers To Watch in 2021.” Majestic Residences can partner with you to start your senior care home business, teach your team the ins and out’s of operations, marketing, and working with residents and their families. On-going support is continual and often within the franchise system.
Profitability is usually much higher for residential assisted living franchise owners than the nursing home opportunity. Potential nursing home franchise owners can expect to pay millions of dollars in start-up costs, making the residential assisted living franchise opportunity much less riskier and much more affordable. Learn more about the Majestic Residences business today.