Is Community Care Better Than Nursing Homes? Survey Says: It’s Hard to Tell

Home- and community-based services (HCBS), initially touted as a cost-saving method of delivering long-term care compared to institutional settings, may not actually be a significantly superior setting in which to receive care, suggests a report from the Agency for Healthcare Research and Quality (AHRQ).

AHRQ reviewed several studies comparing different long-term care models and concluded there’s not enough evidence to truly assess their relative effectiveness in relation to each other. It may be more accurate to simply consider HCBS as a preferred model among consumers, rather than one that provides better care at a lower cost, the report’s authors say. 

“The weakness of the literature stands in sharp contrast to the importance of the topic,” says the AHRQ. “Many stakeholders want to know about the relative effectiveness of alternative modes of LTC. As budgets tighten and as demographically driven demand increases, states and other entities are seeking more efficient ways to deliver LTC.”


The report defines long-term care as differing from acute or episodic medical interventions by nature of its being integrated into people’s daily lives over an extended time. It spans three areas: assistance with activities of daily living including meal preparation, grocery shopping, transportation, and other routine activities; housing; and medical care.

While it’s often associated with institutional settings such as nursing homes, long-term care is also provided in a variety of home- and community-based care settings ranging from a recipient’s home to assisted living and encompassing adult day care. 

More than 11 million people need long-term care to assisted them with ADLs, according to the study. The majority (55%) are 65 or older, and an estimated two-thirds of Americans in this age group will eventually need some type of long-term care for an average of two years, according to projections.


Nearly 1.4 million people currently reside in nursing homes.mMedicaid finances about 40% of the nation’s total long-term care spending, and nursing home care accounts for about 64% of the program’s spending for older adults and the disabled. 

Costs for those receiving nursing home care generally exceed those receiving HCBS, and as a result, many state governments have increasingly prioritized HCBS as a method to restrain long-term care costs, the study notes, especially as consumers have largely expressed a preference for care in home and community settings. 

That has translated to a faster growth in spending for HCBS than for nursing homes. Medicaid spending on HCBS more than doubled between 1995 and 2009 from 19% to 43%. Out-of-pocket expenditures account for about 22% of long-term care spending, with private long-term care insurance covering about 9%.

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Consumer preference for HCBS may not directly correlate to better—or less expensive—care.

The report’s authors were hard-pressed to make any sort of conclusions in regard to cost comparisons between assisted living and nursing homes, or whether there’s a significant disparity in the rate of change in physical function, cognition, and mental health, citing low-strength of insufficient evidence. 

On average, nursing home residents were more physically and cognitively impaired than HCBS recipients and assisted living residents, although mental health and clinical status outcomes were mixed. 

Better research is needed “to address questions related to LTC delivered through HCBS versus nursing homes, including the changes in outcome  trajectories over time, harms, and costs,” the authors say. 

Access the full report

Written by Alyssa Gerace