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History of Assisted Living
How Assisted Living Started in United States

Emergence of Assisted Living

History of Assisted Living
History of Assisted Living

Today assisted living is the most favored and fastest growing long-term care option for seniors in the United States. In a review by the National Survey of Residential Care Facilities, there are now 31,000 plus assisted living communities nationwide. Assisted living houses nearly one million seniors.

It's conception came from the unpopular opinion of skilled nursing twenty-five years ago. Assisted Living is the fastest growing residential housing for older Americans.

The philosophy of assisted living is to treat all residents with dignity; to give privacy and to encourage independence. Assisted living bears preference of "freedom of choice."

It promotes family involvement and interaction with the residents and staff of the facility. Initially, family members saw assisted living as a reasonably attractive option for their older relatives who could no longer live at home but today it has become a lifestyle choice for many seniors due to the variety of options it offers.

Federal and state governments support the assisted living concept and see it as a viable choice over nursing home care because it is generally less expensive.

Federal and state funded Medicaid programs are now paying for assisted living care due to the negative reactions of the public to skilled nursing home care and its high costs. Today, more than 120,000 residents receive assisted living care paid for (in part) by Medicaid Waivers. Many destined for nursing home facilities.

Assisted Living offers a desirable way of life for older adults; better physical environments, improved care and service capacity. Based on the preferences and needs of the elderly, they select from high-rise buildings to one-story Victorian mansions to large multi-acre campuses. There are some assisted living communities today that offer all the amenities found in an entire town. Only residents 50 plus are found living there. One popular model is The Village in Florida.

Historical Evolution


Motivated by distaste of nursing home care, a shift occurred in senior housing beginning in 1979 to 1985. The shift initiated the service capacity and consumer-centered care model.


In 1986 to 1993, the providers, consumers, and government became interested and created four distinguishable kinds of assisted living communities. They included hybrid (reworking the old style), hospitality (resort like setting), housing (55+), and health care (continuum care model) appeared.


Then in 1994 to 2000 Wall Street brought financial investors, and quality of care became the ideal model. Today, due to older adults living longer, eruption of chronic illnesses, and the exploding boomer market, assisted living is reorganizing and examining its standards and how it provides care.

Definition of Assisted Living

What is ALF?
What is ALF?

As Assisted Living became more and more popular, an initiative of nearly 50 national organizations representing providers, consumers, long-term care, health care professionals, and regulators formed at the request of the U.S. Senate Special Committee on Aging to develop consensus recommendations to assure quality in assisted living. The initiative is the Assisted Living Workgroup and it formed in 2003.

The biggest challenge it faced was to craft a consumer friendly definition that addressed elements that many in the Assisted Living Workgroup felt were important to assure quality and raising the bar in assisted living. The elements of concern ranged from private rooms to levels of service and requirements for state licensing.

The definition declares: Assisted living is a state regulated and monitored residential long-term care option. Assisted living provides oversight and services to meet the residents' individualized scheduled needs, based on the residents' assessments and service plans and their unscheduled needs as they arise.

Services required by state law and regulation:

  • 24-hour "alert" staff to provide oversight and meet scheduled and unscheduled needs.
  • Provision and oversight of personal and supportive services (assistance with activities of daily living and instrumental activities of daily living);
  • Health related services (e.g. medication management services).
  • Social services:
  • Recreational activities;
  • Other areas of interests:
  • Critical Issues in Assisted Living
  • Meals
  • Housekeeping and laundry
  • Transportation

They also concluded that a resident has the right to make choices and receive services in a way that will promote the resident's dignity, autonomy, independence, and quality of life. Assisted living is not required to provide ongoing 24-hour skilled nursing.

Types Assisted Living

Assisted Living is a type of senior housing intended for people who need various levels of medical and personal care. The living areas are individual rooms, apartments, or shared quarters. The housing facility creates a home-like setting and promotes independence.

There is a variety of senior housing available for older adults to choose. With an assessment, the resident will find the most appropriate environment based on needs.

Dementia and Memory Care

Assisted Living communities for people living with Alzheimer's disease or related dementia called "Special Care Units." The unit contains in a wing that has additional security, cueing devices and other architectural features. These typically have a required state license to operate.

Congregate Housing is similar to independent living except that it usually provides convenience or supportive services like meals, housekeeping, and transportation in addition to rental housing.

Continuing Care Retirement Communities

Continuing Care Retirement Communities has levels of assistance, including independent living, assisted living and nursing home care. It differs because it provides a long-term contract between the resident and the community, which offers a continuum of housing, services and health care system, commonly all on one campus. The CCRC communities, covered by state regulations in 38 states, and classified as an insurance model governed by the state department of insurance.

Independent Living

Independent Living designed for older adults who require little or no assistance with the activities of daily living. They also include services for residents such as housekeeping, laundry and meals, for additional fees. Residents of independent units may have some home health care services provided by in-house staff or an outside agency. These residents pay a rental rate or monthly fee.

Here, the senior adult leads an independent lifestyle that requires minimal assistance. Independent living also includes rental assisted or market rate apartments or cottages where residents have complete choice in whether to participate in the community's services or programs.

Funding options for assisted living come from private funding, long-term care insurance, and Medicaid.

Levels of Care in Assisted Living Used by States

Each state in the U.S. license assisted living facilities by type of care. In a single-level system, a state licenses only one type of assisted living facility. In the single-level system, any licensed assisted living facility accepts or retains a resident as long as the resident does not have a disqualifying medical condition.

By contrast, in a multi-level system, licensed assisted living facilities care for residents only up to a particular care need. A multi-level system allows three levels: low, moderate, and high.

When a resident has low care needs, she may reside at any type of assisted living facility. When her care needs reach the moderate level, she's permitted to reside only at a facility licensed for moderate or high care needs. When her care requirements increase to the high level, she's allowed to reside only in a facility licensed for high care needs.

The state sets the standards for each level to assure that residents receive care that is adequate.

Current Status

Assisted living as a form of long-term care is at a serious juncture. Decisions on its direction for both the public and the private sector are in a state of flux. In the past thirty years, when Assisted Living began, this service grew to about 33,500 settings caring for well over one million residents by 2011.

Unlike the growth of nursing homes, fueled by Medicaid for low-income people, assisted living expanded largely through the private or out-of-pocket pay market. Although as of July 2013, close to forty-five states provide some public funding under Medicaid waivers. Because assisted living was initially a private pay phenomenon, regulatory oversight lagged behind development. Now with the large numbers of citizens served and growing public payment, the interest in quality standards and oversight is mounting.

Today, assisted living has serious concerns and challenges about its quality, as it expands. The panic comes from consumer advocates like nursing home ombudsmen and state regulators who have responsibility for regulating health and long-term care. The worry exacerbated by news media reports. Collectively, the exposure claims neglect and insufficient care, as well as financial and resident retention practices that mislead the public. Yet, older people and their families continue favoring assisted living and report high satisfaction.

Assisted Living regulation is not a national affair but states are putting regulations to it. Today "assisted living" is not defined in any meaningful way by the federal government and as a result, individual states have mandated regulations. Many of them allow considerable variation from facility to facility.

Even though the states' regulates the assisted living definitions, they're scripted in vague, idealized terms, so much so that it makes them unenforceable. The states delegates the standards of the assisted living facility and the entering resident.

More than two-thirds of the states use the licensure term "assisted living." The second most used term is "residential care." Other definitions include basic care facility, community residence, enriched housing program, home for the aged, personal care home, and shared housing establishment. A state-by-state summary of 2012 legislative and regulatory changes and copies of NCAL Assisted Living State Regulatory Review are available on NCAL's web site.

Was this facility purposely built as a residential care facility?
Responses of don't know (< 1%) and are not shown.
Source: 2010 CDC National Survey of Residential Care Facilities Survey (Facility Responses)

Industry Growth/Slowdown

Senior Housing
Senior Housing

Over the past five years, assisted living has faced tough times in some areas. As a whole, the senior housing has construction financing deficits, dips in occupancy numbers, increasing costs, government funding cuts and a weak housing market. These factors have led to the aging in place phenomenon; to age in place at home.

Despite the challenges mentioned, interest rates have remained generally low, allowing the senior housing industry and consumers some relief from the negative forces of the recession.

After five years of economic downturn, the United States is starting to show signs of recovery but increasing costs and funding cuts are the "new normal" for senior living.

The senior living industry feels that this shift is not a new normal but is just the business of caring for our aging. With the improving housing market, providers, and consumers find confidence as a new foundation gels and drives the next decade in senior housing.

Trends in Senior Living/Assisted Living

End of Skilled Nursing Homes as we know it. Senior living professionals sees the skilled nursing format come to end. The demise of the traditional nursing home model accelerated as consumers sees it as the final resting place. The costs to keep someone in a skilled nursing facility are the highest of any part of the continuum of care. Additional cuts to Medicare and Medicaid can't support today's care methods and will further burden a dysfunctional model.

The focus of aging care is now "person-centered care" and returning people to their homes for comfort, nursing homes will appear as more of a strike in the aging process.

Affordable Housing Crisis for seniors --- today's struggling seniors are growing faster every day. With almost 10,000 Americans turning 65 each day, the number of seniors who need specialized housing will only increase the need of affordable housing solutions.

Department of Housing and Urban Development found over 1 million seniors with "worst case housing needs" and more fall below the poverty level. Independent, affordable senior apartments have long waiting lists and new inventory is not created fast enough. The federal HUD Section 202 Program, Low Income Housing Tax Credits, Housing Choice Vouchers (Section 8) are keys to long-term solutions.

Assisted living communities have reduced services to maintain fiscal health.

Re-Thinking Assets

What happens when a resident outlive one's assets?

Longevity is America's fiscal and moral enemy. Deterioration of mind, body and assets,require close scrutiny.

As life expectancies extend, assumptions will affect both individuals and corporations. Older, sicker people cost everyone substantially more money. The Employee Benefits Research Institution found that almost 44% of those born between 1948 and 1978 will not have adequate retirement income. This exacerbates as interest rates increase. Personal assets of residents will need to factor into a community's pricing power that will flow into economic decisions regarding the physical structure of the community as well as its professional care profile.

Senior Housing Finance

Real Estate Investment Trust (REIT) is a major participant in the capital finance options for senior living. Many finance firms and banks have record years in 2012 and 2013. As rates remain low, they are the drivers for Mergers & Acquisitions.

Competing for private pay customers increases since senior living investors avoid Medicare and Medicaid patients.

Construction financing will become exclusive for those with proven track records of development success, strong credit and liquidity. As 2013 progresses, new players will emerge into the senior housing capital arena from institutional players to more private equity to grow their yields.

Housing Meets Seniors' Demands

Walkable, urban lifestyle centers in suburban communities is more feasible than the big-city, downtown retirement living. We forget that city living is more expensive than the suburbs. So does this concept of urban, city living work for seniors on tight budgets or average retirees, or is this a luxury?

Technology enabled care drives the remote care model and service packages in senior living communities. The remote care monitors and detects early changes in a resident's and quickly acted upon. The technology enables seniors to live more independently and maintain a lower level of care for a longer period of time, instead of being transferred to a skilled nursing facility.

Moving Forward

Assisted living facilities are not the same; they're a work in progress. Evaluating models recognize the variations in assisted living facilities, both from state to state, and from facility to facility within the same state.

The next few years, expect to see a significant growth of new and additional state legislation for senior care, housing and other services.

Carol Marak
Carol Marak

After seven years of helping her aging parents, Carol Marak has become a dedicated senior care writer. Since 2007, she has been doing the research to find answers to common concerns: housing, aging and health, staying safe and independent, and planning long-term.