Most nursing homes in the United States are not non-profit. About 72 percent of Medicare-enrolled skilled nursing facilities are for-profit businesses, roughly 22 percent are non-profit, and the remaining 6 percent are run by government agencies.1HHS ASPE. Ownership of Skilled Nursing Facilities: An Analysis of Newly-Released Federal Data So the honest answer to whether nursing homes are non-profit is: some are, but the industry is dominated by for-profit ownership, and the category a facility falls into shapes how it spends its money, staffs its floors, and treats surplus revenue.
Those ratios have held steady for the past decade, with the for-profit share creeping up a few percentage points as investor-backed companies acquire smaller independent and non-profit homes. When you weight by bed count, the for-profit share grows slightly, because for-profit chains tend to operate larger facilities.
What Makes a Nursing Home Non-Profit
A non-profit nursing home is a tax-exempt organization under 26 U.S.C. ยง 501(c)(3), the same section that covers churches, universities, and charitable hospitals. To qualify, the organization must be organized and operated exclusively for charitable purposes, and no part of its net earnings can benefit any private individual or shareholder.2Office of the Law Revision Counsel. 26 USC 501 – Exemption From Tax on Corporations, Certain Trusts, Etc. That prohibition on private benefit is the legal line between non-profit and for-profit care.
Many non-profit homes were founded by religious denominations, fraternal orders, or community foundations, and those affiliations often shape the culture, admission practices, and charitable care policies of the facility today. Others are standalone community operations governed by a local board of directors with no religious tie at all.
Non-profits still run surpluses. What changes is where the money goes. Extra revenue cannot be paid out as a dividend or as compensation tied to ownership. It stays inside the organization and typically funds building upgrades, equipment, staff training, or reserves. The IRS accepts that operating at a surplus does not disqualify a non-profit from tax exemption, as long as the funds advance the charitable mission.3Internal Revenue Service. General Requirements for Tax-Exemption Under Section 501(c)(3)
The tax benefits are substantial. In addition to federal income tax exemption, non-profit nursing homes are usually exempt from state and local property taxes, and donations to them are tax-deductible for the donor. For a mid-sized facility, those exemptions can add up to hundreds of thousands of dollars a year that, at least in theory, flow back into operations.
What a For-Profit Nursing Home Actually Is
For-profit nursing homes are commercial businesses that exist to generate returns for their owners. Most are organized as corporations or limited liability companies. Across all ownership types, about 64 percent of facilities are corporations and 16 percent are LLCs.1HHS ASPE. Ownership of Skilled Nursing Facilities: An Analysis of Newly-Released Federal Data They pay the standard federal corporate income tax rate of 21 percent plus applicable state taxes.4Congressional Budget Office. Increase the Corporate Income Tax Rate by 1 Percentage Point
The structural difference from a non-profit is what happens after expenses are covered. A for-profit facility distributes remaining revenue to owners, shareholders, or investors. That incentive drives a focus on operational efficiency: controlling labor costs, keeping occupancy high, and centralizing overhead across multiple locations. Many for-profit homes belong to regional or national chains that share billing, purchasing, and human resources functions across dozens of facilities.
When Private Equity Owns the Home
Private equity investment in nursing homes has grown substantially over the past two decades. A PE-owned facility often sits inside a web of related companies under common ownership. The nursing home might lease its building from one related entity, hire staff through another, and pay management fees to a third. Each of those transactions moves money out of the operating facility and into the broader corporate structure.
Research from UCLA Anderson found that these related-party transactions can inflate a facility’s real estate costs by around 20 percent and management costs by roughly 25 percent compared to open-market rates, and estimated that the majority of nursing home profits were effectively hidden through those inflated payments to affiliated companies. A 2025 systematic review in the medical literature found that PE ownership was associated with higher deficiency counts, increased hospitalization rates, and higher mortality among residents.
Government-Run Homes: The Smallest Category
The 6 percent of facilities run by government agencies fall into two main groups. State veterans homes are operated by state governments and receive federal per diem payments from the Department of Veterans Affairs for each eligible veteran in care.5Office of the Law Revision Counsel. 38 USC 1741 – Criteria for Payment Each state sets its own eligibility and admission criteria, and the facilities must meet both state licensing rules and federal VA standards.6eCFR. 38 CFR Part 51 Subpart C – Requirements Applicable to Eligibility, Rates, and Payments
County and municipal nursing homes serve the general public and often function as safety-net providers for residents without private insurance or the means to pay for a private facility. Funding comes from local tax revenue, state appropriations, and Medicaid. Because they are public institutions, budgets and management decisions are usually subject to open-records laws that don’t apply to private homes.
Does Non-Profit Status Mean Better Care?
On average, yes, but the margin is narrower than families often assume, and individual facilities vary enormously within each category.
Non-profit nursing homes score modestly higher on the CMS Five-Star Quality Rating System. Non-profits averaged an overall star rating of about 3.32 out of 5 compared to 3.21 for for-profits, and about a third of non-profit homes earned the top 5-star rating, a substantially higher share than among for-profits. That is a real difference on a five-point scale, but plenty of excellent for-profit homes and mediocre non-profit ones exist.
Staffing
Staffing is where the ownership gap shows up most consistently. Non-profit facilities have historically provided roughly 20 more minutes of direct-care nursing time per resident per day than for-profit homes. For a resident who needs help eating, bathing, or repositioning around the clock, that adds up.
The federal staffing floor matters more than it did a year ago, because it is lower. Effective February 2, 2026, CMS repealed the minimum staffing standards adopted in 2024.7Federal Register. Medicare and Medicaid Programs; Repeal of Minimum Staffing Standards for Long-Term Care Facilities The current federal minimum reverts to the long-standing rule: a registered nurse on duty at least 8 consecutive hours per day, 7 days a week, with licensed nursing coverage around the clock.8eCFR. 42 CFR 483.35 – Nursing Services Some states impose higher minimums, but the federal baseline is now looser than it was, which makes asking a facility directly about staffing ratios and RN coverage hours more useful than checking whether it clears a federal floor.
Deficiency Citations
CMS inspects every nursing home that accepts Medicare or Medicaid, and the resulting deficiency citations are public. For-profit facilities consistently receive more citations on average than non-profits. Among facilities cited for care-related safety issues, 75 percent were for-profit, compared to their 72 percent share of the overall market. The gap is modest but persistent across years of data.
Cost and Medicaid Access
Ownership type does not drive the sticker price. Nursing home costs track local labor markets, real estate values, and the level of care a resident needs, not tax status. Nationally, a semi-private room typically runs around $9,000 to $9,500 a month, with state averages spanning roughly $5,200 to over $31,000.
Medicaid access carries a counterintuitive twist worth knowing about. For-profit homes actually serve a higher share of heavily Medicaid-dependent residents: 18 percent of for-profit facilities had populations that were 80 to 100 percent Medicaid, compared to 8 percent of non-profits. Medicaid pays about 82 cents for every dollar of actual care cost, and many for-profit operators accept high Medicaid volumes because thin margins still generate revenue at scale. Non-profit homes in wealthier communities may have fewer Medicaid beds available. If a family member will rely on Medicaid, don’t assume a non-profit will be easier to get into.
How to Check a Specific Facility’s Ownership
The most direct tool is CMS Care Compare at medicare.gov/care-compare, which lists ownership type, star ratings, inspection results, and staffing data for any Medicare-certified nursing home.9Centers for Medicare & Medicaid Services. CMS Care Compare Empowers Patients When Making Important Health Care Decisions The ownership field will show for-profit, non-profit, or government.
For a closer look at a non-profit’s finances, request its IRS Form 990. Non-profits must make that filing available for public inspection through the organization or the IRS.10Internal Revenue Service. Instructions for Form 990 Return of Organization Exempt From Income Tax Form 990 shows total revenue, major expenses, and executive compensation. Free copies are available through ProPublica’s Nonprofit Explorer and similar sites. A non-profit paying its CEO $800,000 while running short on floor staff is worth knowing about before signing an admission agreement.
For for-profit facilities, ownership can be harder to unpack. CMS publishes raw ownership data through its Provider Data Catalog, which lists the individuals and entities with stakes in each facility.11Centers for Medicare & Medicaid Services Data. Ownership – Provider Data Catalog Multiple layers of LLCs and management companies in a home’s ownership records point to the kind of structure where related-party transactions can move money away from direct care.
Ownership type is a starting point, not a verdict. A well-run for-profit home with strong staffing and clean inspections will deliver better care than a struggling non-profit with chronic deficiencies. Use the ownership information alongside star ratings, inspection history, and an in-person visit before you decide.