The Financial Reality of Home Care

For many families, aging at home appears to be the more affordable option. It often feels like the logical choice—especially when a home is paid off or has been in the family for decades.

But as care needs increase, the financial picture often changes.

Our Home Care Study takes a closer look at the financial realities of aging at home compared with senior living. While home care can be an excellent solution for older adults who need only occasional assistance, costs can rise quickly as care needs become more frequent or complex. Understanding the full financial picture—including the cost of care, housing expenses, insurance limitations and future care needs—can help families make more informed long-term decisions.

When Home Care Becomes More Expensive

Home care costs are typically based on the number of hours a caregiver is needed. As those hours increase, so does the monthly expense.

According to the 2025 CareScout Cost of Care Survey, the national median cost of non-medical home care is $35 per hour, while the median monthly cost of assisted living is about $6,200. Based on national median costs , approximately 40 hours of home care per week can cost about the same as assisted living. Beyond that point, home care often becomes the more expensive option.

For older adults who need just a few hours of assistance each week, home care may be the most practical and affordable choice. As support needs increase, however, the financial equation often begins to shift.

For example:

• Approximately 12 hours of home care per day can cost around $12,000 per month based on national median estimates—often nearly double the average monthly cost of assisted living in many regions.
• Around-the-clock (24-hour) home care can exceed $20,000 per month, making it one of the most expensive long-term care options.

These figures reflect the cost of caregiving alone.

Don’t Overlook the Hidden Costs of Staying Home

Caregiving isn’t the only expense to consider.

Whether an older adult owns or rents a home, aging in place comes with ongoing expenses that continue even as care needs grow. Housing, utilities, insurance, groceries, home maintenance and transportation all continue alongside the cost of paid caregivers. Many families underestimate these costs until they begin accumulating month after month.

By comparison, many senior living communities include housing, meals, utilities, maintenance, transportation and other services in one predictable monthly fee. Residents also benefit from built-in opportunities for social engagement, which can help reduce isolation while supporting physical, emotional and cognitive well-being.

Does Medicare Cover Long-Term Home Care?

Many families are surprised to learn that Medicare generally does not cover long-term, non-medical home care, including assistance with bathing, dressing, meal preparation, housekeeping, or companionship. While Medicare may pay for short-term home health services—such as skilled nursing, physical therapy or rehabilitation prescribed by a physician after an illness, injury or hospital stay—it typically doesn’t cover ongoing assistance with everyday activities such as bathing, dressing, meal preparation or companionship.

It’s also important to understand that Medicare doesn’t pay for room and board in independent living or assisted living communities, although it may cover eligible medical services provided to residents. Families are generally responsible for those costs as well, although Medicare may still cover eligible medical services residents receive while living there.

Predictability Matters, Too

Choosing between home care and senior living isn’t just about finding the lowest monthly cost. It’s about understanding long-term affordability and financial predictability.

Home care offers flexibility and allows many older adults to remain in familiar surroundings. However, costs typically increase as additional hours of assistance become necessary. Senior living communities may also experience annual rate increases, but because housing, meals, utilities, maintenance and many services are bundled into one monthly fee, costs are often easier to anticipate and budget for.

For some families, flexibility is the highest priority. For others, predictable monthly expenses provide greater peace of mind. The right choice depends on one’s needs, preferences and financial situation.

Finding the Right Fit

Every family’s financial situation, care needs, and goals are different. For some, home care offers the right level of support while allowing an older adult to remain at home. For others, a senior living community provides greater value through maintenance-free living, built-in social opportunities and access to additional support as needs evolve.

The best decision begins with understanding the complete financial picture—not only today’s expenses, but also how costs may evolve as care needs change over time.

If you decide that senior living may be the right fit, use our Community Finder to compare communities in your area and connect directly with those that match your lifestyle, preferences and needs.

Where You Live Matters

Where You Live Matters is an educational resource powered by the American Seniors Housing Association (ASHA). Our mission is to help older adults and their families make informed decisions by providing unbiased information about senior living, aging and care options, along with verified community listings across the country.