[Last updated May 12, 2025]

The term “nursing home level of care” (NHLOC) describes a common standard for measuring the minimum level of medical support an individual needs to become eligible for admittance to a nursing home and for Medicaid’s coverage of this care. The measure is also used to determine eligibility for other Medicaid-funded programs, such as the Program of All-Inclusive Care for the Elderly (PACE), and for acceptance into some other facilities. This article will explain what a nursing home level of care means in practice and where it is relevant. We’ll also highlight some challenges in understanding NHLOC, particularly as no federal definition exists.

Rules and definitions vary

Currently, there is no single, nationally accepted definition of NHLOC; the definitions vary by state. We’re going to discuss general definitions and themes among state determinations, so the specifics can be slightly different in your area. You can learn more about the rules and regulations that apply to your state through your local Oasis Senior Advisor, who is the expert in NHLOC rules in your area.

General definition of a nursing home level of care

Though state-level definitions can vary, NHLOC usually comes down to medical needs. Paul Doyle, owner of Oasis Senior Advisors Fairfield-Westchester, said the basis for determining whether someone has nursing-home-level care needs usually revolves around the individual’s medical needs. While multiple aspects of needs go into this determination, the amount of “ongoing skilled medical care” weighs heavily in a person’s care needs.

Many definitions state that an individual must have limitations in at least two different areas, and these issues must be ongoing. In other words, a temporary injury or illness that reduces a person’s ability to support themselves would not necessarily qualify them for NHLOC. Many times, an assisted living facility has the capabilities to help meet a resident’s temporary needs. If not, temporary accommodations can be made, but these temporary needs do not require a person to move permanently to a nursing home.

The four areas commonly considered for NHLOC are highlighted below. However, there are still many differences in how these areas are defined and assessed, and states do not necessarily incorporate all four. 

Medical needs

This area considers any health conditions, plus whether the individual needs medical care, such as assistance with IV drips, injections, or catheter care. 

This is the area of need that weighs most heavily on whether someone would best benefit from a nursing home, because these facilities employ nursing professionals who provide care for residents on an ongoing basis. While other senior care facilities employ licensed nursing professionals to oversee other staff or programming, they typically do not spend much time providing care for residents.

Cognitive impairment

Here, the focus is on whether there are notable memory issues or cognitive challenges, often due to dementia. This can lead to difficulty following a schedule or instructions. 

Many senior care facilities can accommodate the needs of people with dementia or other cognitive impairment, so having this need doesn’t necessarily qualify a person as having NHLOC. If they also have ongoing medical needs, however, the combination might make a nursing home the most helpful environment for the individual.

Functional needs

This refers to whether someone is able to perform their basic activities of daily living (ADLs), such as bathing, eating, and dressing. 

Even someone who needs help with multiple activities of daily living can still be a great candidate for a senior care environment other than a nursing home. Assisted living facilities, for example, have caregivers who assist with all these daily tasks. When a high level of functional care needs combines with other areas of need, like ongoing medical care, it could be determined that a person has NHLOC.

Behavioral issues

An assessment of an individual’s most helpful environment may also include their behavior. Mood swings, aggressiveness, impulsiveness, and other behaviors can indicate a safety issue for staff members, other residents, and the individual. While some of these behaviors may arise from conditions like dementia, mental health issues, or even poorly managed medications, a state’s requirements may involve a behavior assessment to determine if a nursing home is the best environment for that individual.

As we mentioned, the determination of NHLOC isn’t easily distinguishable, and each individual’s case is interpreted through the requirements of the state where the person lives. It’s no wonder that there are challenges in understanding NHLOC in your search for senior care. Let’s dive into some of the challenges now.

Challenges in understanding a nursing home level of care

Understanding NHLOC could be important for your situation, even though it is challenging. We’ll go over some of the reasons people find it difficult to understand here.

State definitions of nursing home level of care vary

Using NHLOC as a measure is complex because every state defines it differently. A person may meet the requirements for NHLOC in one state and not in another, which creates challenges if they need to move to a different state.

At the same time, NHLOC definitions often aren’t simple. States may highlight multiple areas that assessors should consider, including the functional, medical, cognitive, and behavioral areas discussed above. For that matter, the term “nursing home level of care” isn’t even used in all states. Some states use other terms, like Florida, which uses “nursing facility level of care.”

Differences don’t end with the definition of NHLOC, either. States also vary in their assessment tools and how different needs are assessed. This contributes to how people can meet NHLOC requirements in one state and not in another.

Here are a few examples of how the definitions and assessments can vary:

• California: California’s approach includes an observation of the individual and an assessment of their treatment course. A doctor then assesses whether there is a need for a nursing home level of care, considering factors like whether the individual can complete their ADLs, administer their own medications, and have predictable behavior.
• Florida: A physician or registered nurse must determine whether an individual has the required care needs. An assessment tool called CARES (Comprehensive Assessment and Review for Long-Term Care Services) is used as part of the process.
• Texas: Texas uses an MDS (Minimum Data Set) assessment. This assessment is completed by a registered nurse and then reviewed by the Texas Medicaid and Health Partnership. To meet the criteria, individuals must have a significant medical issue that an untrained person could not treat.

You can see that not only is each state allowed to have its own definition, but the wording of the definition is open to interpretation. This allows each individual to apply their situation to the rules to make the best determination.

The general public isn’t aware of other senior care facility capabilities

Multiple types of senior care facilities exist, such as independent living, assisted living, memory care, and CCRCs, all in addition to nursing homes. These varied styles of senior care serve different purposes, which is a stark difference from the limited senior care offerings from decades ago, when nursing homes were the only option. 

“Commonly, a family may assume Mom needs a nursing home, but that might not be the case,” Doyle said. “People assume that if Mom needs help bathing, she needs to move to a nursing home. If bathing assistance is a person’s only need, it’s highly likely that an assisted living community would offer all the help they need for a lower monthly cost.” 

Since other factors play a role in the senior care environment that is best for an individual, it can be a challenge to know if a nursing home is the best fit. Talking with a professional can help ensure that you’re making the right choice for your needs.

Why NHLOC is important

It’s crucial to be aware of NHLOC requirements in your state, as the measure is relevant in multiple situations. It can influence your acceptance into some facilities and the financial assistance you receive.

Nursing home acceptance

Not surprisingly, NHLOC plays a key role in determining whether a person is accepted to a nursing home. Potential residents need to demonstrate that their needs are sufficient to require this level of care. If the individual’s needs don’t meet the standard for NHLOC, they may be better suited to assisted living instead of a nursing home.  

Assisted living communities and CCRCs

The nursing home level of care is also relevant to other environments. In particular, assisted living facilities will likely refuse residents with NHLOC requirements, as the facility cannot meet such care needs.  

Continuing care retirement communities (CCRCs) may also use NHLOC to determine where a new resident should be placed and when to transition someone from assisted living to skilled nursing care. Those with relatively low levels of care needs may start in assisted living or even independent living, where care needs are minimal.

Health-needs-related programs

Being assessed as requiring a nursing home level of care is also essential for some programs.

The first of these is the Program of All-Inclusive Care for the Elderly (PACE). This Medicare and Medicaid program is designed to help people remain in their homes for as long as possible, even when they would typically need care in a nursing home. Being certified as requiring NHLOC is key to being eligible for PACE services. Home- and community-based services (HCBS) Medicaid waivers also frequently use NHLOC as a criterion for providing support. 

Medicaid itself also relies on NHLOC assessment. Notably, individuals need to be assessed as requiring a nursing home level of care before Medicaid will pay for such care.

Understanding NHLOC is crucial for determining eligibility for nursing home care and financial assistance for this level of care. While the exact definition varies by state, the general principle is that the individual has care needs that exceed what can be provided by family members or in assisted living. Familiarizing yourself with your state’s definition of NHLOC can help you more effectively navigate senior care options for yourself or a loved one. If you need to look for a community and either don’t know where to start or would like the support of a professional, find the Oasis Senior Advisor in your area.