How Much Does It Cost to Operate an Assisted Living Facility
- Nate Jones, CPCU, ARM, CLCS, AU
- Nov 26, 2025
- 2 min read
Owning and operating an assisted living facility comes with significant financial responsibilities. Understanding the costs involved helps owners plan budgets, set fees, and ensure profitability.
This guide breaks down the key expenses associated with running an assisted living facility.
1. Staffing Costs
Staffing is typically the largest expense for assisted living facilities. Costs vary based on facility size, services offered, and staff experience.
Administrators/Managers: $4,000–$8,000/month
Nurses and Care Staff: $3,000–$6,500/month per nurse or caregiver
Support Staff (housekeeping, kitchen, activities): $2,000–$4,000/month
Training and Benefits: $500–$2,000/month per employee
Tip: Offering competitive salaries, benefits, and training helps reduce turnover, which can otherwise increase costs.
2. Facility and Utilities
Operating an assisted living facility requires maintaining a safe, comfortable environment for residents.
Rent or Mortgage: $5,000–$25,000/month (depending on location and facility size)
Utilities (water, electricity, gas): $1,500–$5,000/month
Maintenance & Repairs: $1,000–$5,000/month
Furnishings & Equipment: $2,000–$10,000 upfront and periodic replacement
3. Licensing and Regulatory Costs
Compliance with state regulations is mandatory.
State Licensing Fees: $500–$5,000/year
Inspection Fees and Certification: $100–$1,000/year
Staff Certification/Continuing Education: $200–$1,000 per staff member/year
4. Insurance Costs
Insurance is critical to protect your facility from liability, property damage, and employee-related risks.
General Liability: $500–$3,000/year
Professional Liability: $500–$2,500/year
Workers’ Compensation: $1,000–$5,000/year (depends on number of staff)
Commercial Property: $1,000–$5,000/year
Commercial Auto (if transporting residents): $500–$2,000/year
5. Food, Supplies, and Activities
Providing meals, recreational programs, and supplies for residents is another ongoing expense.
Food & Groceries: $1,500–$5,000/month
Recreational Activities & Program Supplies: $500–$2,000/month
Medical & Hygiene Supplies: $300–$1,500/month
6. Marketing and Client Acquisition
Attracting residents is crucial for maintaining occupancy and profitability.
Website and Online Marketing: $500–$2,000/month
Community Outreach and Events: $200–$1,000/month
Referral Programs: $100–$500/month
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Final Thoughts
The total monthly cost of operating an assisted living facility can range widely—from $20,000 to $100,000+—depending on size, location, and services offered. Understanding and budgeting for these expenses ensures your facility remains profitable and compliant.
Protecting your facility with comprehensive insurance coverage from Wexford Insurance safeguards your investment and allows you to focus on providing excellent care.
Contact us today.
