ACIF 2025 | U.S. Long-Term Care Industry Report: Navigating Growth, Policy Shifts, and Sustainable Innovation
「The future of long-term care depends on one principle: balancing compassion with innovation — because aging well is both a human right and a shared responsibility.」 — Dr. Theresa Chang (Source: Anke Media)
The U.S. long-term care (LTC) sector is entering a critical period of transformation. Driven by demographic shifts, financial pressures, and post-pandemic realities, the industry faces both unprecedented challenges and opportunities for reinvention.
At the Asia Pacific Care Industry Forum (ACIF) 2025, held as part of Cares Expo Taipei 2025, Dr. Theresa Chang, President of CQC Senior Care Systems (U.S.), shared valuable insights into the state of the American long-term care industry—its structural trends, policy shifts, and innovations shaping the next decade.
This report summarizes the key themes of her presentation and interview, outlining how the U.S. LTC system continues to evolve and what lessons it offers to international providers and policymakers.
The U.S. Long-Term Care Market: Demographic Pressure and Market Growth
The United States has one of the world’s most mature and diversified long-term care markets, comprising over 66,000 regulated facilities serving approximately 6.9 million seniors. The system includes nursing homes (around 15,000 to 26,000), assisted living centers, home care providers, hospices, and continuing care retirement communities (CCRCs), forming a continuum of services that range from skilled medical care to supportive independent living.
The key driver of market expansion is demographic: the Baby Boomer generation (born 1946–1964) is entering its senior years. By 2030, all Boomers will be over 65, creating explosive demand for both institutional and home-based care. This demographic shift ensures steady long-term growth across multiple sectors:
Nursing Homes: The most regulated and cost-intensive sector, primarily funded through Medicaid and serving lower-income seniors or those with high medical dependency.
Assisted Living Facilities: This sector caters mainly to the middle- and upper-income population, with a focus on lifestyle and independence. This segment remains stable with strong private pay demand.
Home and Community-based Services (HCBS): The fastest-expanding categories, reflecting consumer preference for home- and community-based care (HCBS), such as small group home or residential group home or Program of All-Inclusive Care for the Elderly (PACE).
Continuing Care Retirement Communities (CCRCs): A private-pay, high-end model integrating independent living, assisted living, and nursing services within one campus.
Dr. Chang noted that dementia care is one of the sector’s strongest growth areas. With over 6.7 million Americans currently living with Alzheimer’s or related conditions, the U.S. has accelerated development of Memory Care units, cognitive engagement programs, and person-centered environments. “The U.S. model increasingly focuses on dignity, privacy, and home-like environments—care that’s not only safe but meaningful,” she said.
A Multi-Layered System: Medicare, Medicaid, and the “Missing Middle”
Unlike many countries with universal systems, the U.S. long-term care landscape is market-driven, shaped by a mix of federal, state, and private financing mechanisms.
Three primary payers define the system’s structure:
Medicare:
A federal insurance program for individuals aged 65+ or with specific disabilities, covering short-term rehabilitation and acute care—not long-term custodial care.
Medicaid:
The largest public payer, covering roughly 60% of all nursing home residents and over half of total LTC expenditures annually. It targets low-income seniors and supports both institutional and home-based services.
Between 2015 and 2023, the number of skilled nursing facilities certified by the Centers for Medicare & Medicaid Services (CMS) declined by about 4%—a net loss of nearly 650 facilities. This drop reflects shifting preferences toward home and community-based care and the lasting effects of the pandemic, even as overall demand for long-term care continues to grow.
Private Pay:
Affluent seniors or families who pay out-of-pocket for assisted living, CCRCs, or specialized rehabilitation.
This tripartite structure creates a funding gap for middle-income seniors, those too wealthy to qualify for Medicaid but unable to afford private facilities. Dr. Chang referred to this as the “missing middle”, the most underserved demographic in the U.S. care economy.
“If you’re rich, you can pay. If you’re poor, Medicaid helps. But the middle class—our largest group—has the fewest options.”
Long-term care insurance could, in theory, fill this gap—but uptake remains low due to high premiums and limited coverage. The recent proposed cuts, reducing Medicaid spending by nearly $1.1 trillion over the next decade, are projected to result in millions losing Medicaid coverage by 2034, reducing access to long-term care services. Dr. Chang also noted that recent fiscal policy adjustments under Trump-era budget realignments have tightened Medicaid reimbursements and reduced access to nonprofit capital loans, placing strain on community-based organizations and 501(c)(3) facilities that depend on such funding to sustain operations. At the same time, skilled nursing facilities—subject to strict staffing ratios—continue to struggle with recruitment and retention.
COVID-19: A Catalyst for Home and Community-Based Care
The COVID-19 pandemic fundamentally reshaped the U.S. long-term care landscape, exposing vulnerabilities in institutional settings and accelerating a nationwide shift toward home and community-based services (HCBS), according to Dr. Chang.
Federal relief funding during the pandemic provided short-term stabilization for long-term care operators, yet it also catalyzed a lasting transformation—many seniors and families now prefer to age in place, supported by professional home care and telehealth integration.
Programs such as the Program of All-Inclusive Care for the Elderly (PACE) now play a central role in expanding this HCBS sector. PACE is specifically designed for elderly individuals, age 55 and older, who need a nursing home level of care but want to continue living safely in their homes or communities. PACE enables those seniors to receive coordinated medical, rehabilitative, and social services outside traditional institutions.
Dr. Theresa Chang emphasized that the home-based care segment has become the largest and fastest-growing component of the U.S. long-term care system—and it continues to expand steadily. Within this domain, the U.S. distinguishes clearly between skilled home care and personal care or non-medical services.
“Home care is not simply personal assistance—it is skilled care,” Dr. Chang explained. “When we talk about ‘acute care at home,’ it involves professional nurses performing initial assessments, followed by specialized teams such as physical therapists, occupational therapists, or speech pathologists delivering medical-level services.”
This model allows physicians to coordinate comprehensive in-home treatment plans that may include wound care, nutrition support (TPN), dialysis, and hospice services. For end-of-life or palliative cases, care teams often extend to spiritual and emotional support providers, ensuring a holistic approach that mirrors institutional standards while preserving the comfort of home.
Operational Models, Quality Control, and the Role of Technology
Even amid financial constraints and workforce shortages, many U.S. long-term care providers continue to uphold strong standards through disciplined management and internal accountability.
Dr. Chang described a peer-driven quality control model in which facility managers conduct quarterly cross-site inspections using comprehensive checklists that assess resident care, staff performance, and environmental safety. “Our internal audits create healthy competition, ensuring compliance and reducing the risk of government penalties,” Dr. Chang explained.
This approach has become a benchmark for operational excellence, allowing organizations to maintain consistency even under tightening regulations.
Technology now plays a central role in improving efficiency, transparency, and care coordination. From digital dashboards to remote monitoring, tech integration has accelerated—but adoption remains deeply influenced by geography and culture. “Long-term care is highly local and cultural,” Dr. Chang said. “What works in New York may not fit rural communities.”
Still, she stressed that technology must never replace the human touch. “AI is a great tool, but it cannot replace compassion. Caregivers are the heart of the system, not the hardware.”
Emerging tools like AI conversational companions are showing promise in dementia care by fostering engagement and reducing isolation, though Dr. Chang emphasized that human oversight remains essential to maintain emotional safety and connection.
Sustainable Growth: Diversification, Market Positioning, and Fundraising
To remain competitive, providers must continually adjust their pricing and care mix, balancing affordability with quality. Investor interest remains high, with several publicly traded healthcare REITs and operating companies expanding aggressively through acquisitions.
Operators must target distinct income brackets through tiered product lines:
Private Pay (CCRCs, Memory Units, High-End Rehab): Serving affluent seniors with wellness, luxury, and social amenities.
Medicare (Rehabilitation and Short-Term Post-Acute Care): Stable and growing, driven by hospital discharge trends.
Medicaid (Nursing Homes, Group Homes): Essential but low-margin, requiring consolidation for survival.
Another unique strength of the U.S. system lies in its nonprofit fundraising culture. Dr. Chang highlighted the effectiveness of the 501(c)(3) model, which allows tax-deductible donations to nonprofit healthcare organizations.
In the U.S., major institutions like the Alzheimer’s Association and local dementia networks use community events—such as walks, galas, and awareness campaigns—to finance research and operations. Dr. Chang encouraged policymakers to adopt similar mechanisms: “Fundraising isn’t begging—it’s community empowerment. Americans do it daily because they believe in shared responsibility for aging well.”
Conclusion: Lessons for a Changing Global Care Landscape
The U.S. long-term care industry exemplifies both the potential and pitfalls of a market-based eldercare model. It is dynamic, innovative, and diverse—but also fragmented and inequitable. Dr. Chang’s insights offer a compelling reminder that the future of eldercare must balance technology with empathy, policy with flexibility, and market forces with social responsibility.
As part of the Asia Pacific Care Industry Forum (ACIF) 2025, this feature is one in a special series highlighting global perspectives on the future of care.
👉 Read our earlier comprehensive ACIF 2025 overview: https://reurl.cc/XQda7e
👉 Meet the forum speakers lineup: https://reurl.cc/GN9GMG
In the coming weeks, we will also be publishing exclusive reports from each speaker, featuring insights from international leaders and innovators. Stay tuned as we continue to explore how global collaboration is shaping the next decade of ageing and care innovation.
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