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Nursing Home NAICS Code: Key Insights and Industry Impact

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Written by Tom Bradford

May 17, 2025

Last Updated on January 30, 2026 by Tom Bradford

Updated January 2026: We have updated the article with new developments on the rescission of federal minimum staffing standards for nursing homes, advances in AI-powered and IoT-connected assistive technologies, changes to CMS’s rating and regulatory systems, and expanded coverage on the role of smart mobility and predictive analytics in supporting aging in place.

Understanding NAICS Code 623110: Nursing Care Facilities

The North American Industry Classification System (NAICS) is a standardized framework utilized across North America for categorizing industries. Amazingly versatile, it helps businesses, researchers, and policymakers understand the complex landscape of different sectors. Specifically, NAICS code 623110 pertains to Nursing Care Facilities, commonly referred to as Skilled Nursing Facilities. According to NAICS.com, these establishments are primarily involved in providing inpatient nursing and rehabilitative services, which are crucial components of the healthcare sector. They boast a permanent core staff of registered or licensed practical nurses delivering continuous personal care. The well-defined categorization of these facilities plays a significant role in industry analysis, regulatory compliance, and research, guiding stakeholders to understand where nursing homes fit within the broader healthcare industry landscape.

Industry Size, Employment, and Economic Impact

Nursing care facilities are significant employers and substantial financial contributors. SICCODE.com reports approximately 21,713 active companies in the United States, providing employment to over 1.6 million people. The sector’s total industry revenue exceeds $119 billion annually, with over $51 billion allocated to payroll, highlighting not only its economic but also societal importance. The Bureau of Labor Statistics supports these findings, confirming the deep integration of nursing facilities within the healthcare economy. This sector’s influence ensures millions receive necessary care and contributes significantly to both employment and economic stability within healthcare.

Current Trends and Future Outlook for Nursing Care Facilities

The nursing care facility industry is currently navigating various evolving trends and challenges reshaping its trajectory. As the global population ages, demand is intensifying. According to the National Investment Center for Seniors Housing & Care (NIC), occupancy rates recently increased to 84.5%. Such trends are expected to continue as the demand for elderly care grows. Yet, this burgeoning demand presents both opportunities and challenges. Reimbursement dynamics, especially Medicare and Medicaid changes, significantly impact operational sustainability. Experts predict a 4.2% increase in Medicare payments for 2025, providing some respite against rising operational costs, although not entirely counterbalancing them (ACPlus).

Significantly, recent years have seen rapid integration of advanced assistive technologies in both facility- and home-based care. AI-powered smart wheelchairs and mobility aids now feature GPS navigation, collision avoidance, real-time health monitoring, voice control, and connectivity with mobile apps, enabling highly personalized and adaptive support for users (Everything Medical Online, 2025; Cognitive Market Research, 2025). The most current trends highlight adoption of sensor-equipped grab bars, wearable monitors, and IoT-integrated bathroom safety systems—technologies that allow monitoring for falls, changes in resident mobility, and early detection of health events (Skilled Nursing News, 2026)[5]. Predictive analytics assess risk for falls or pressure ulcers, supporting proactive interventions and reducing hospitalizations[1][3][5][7]. These systems are increasingly used to enable aging in place and blur the distinction between facility and home-based care.

Wearable sensors and predictive analytics allow care staff to detect early health risks, including fall likelihood and changes in mobility or sleep, so interventions can occur proactively (Synchrony Florida, 2025; ButterflyMX Blog, 2025). Smart home technology—such as voice-activated systems, fall detection, and electronic medication dispensers—further improves safety, clinical monitoring, and independence, whether used in care facilities or private homes. Rehabilitation robotics, virtual telehealth solutions, and AI-connected devices are also shaping inclusive design and promoting autonomy and participation in rehabilitation programs[3][5].

Telehealth is now a fundamental component in many nursing care models, integrating virtual consultations, remote monitoring, and digital recordkeeping to maintain continuity and quality of care (ButterflyMX Blog, 2025). These technological advances are accompanied by broader consumer trends emphasizing aging in place. As a result, adopting IoT-enabled assistive devices and home modifications to support independence in familiar environments is increasingly prioritized. Lessons from the COVID-19 pandemic, especially regarding infection control and continuity of access to support equipment, continue to shape care delivery, device distribution, and regulatory practices (Cognitive Market Research, 2025).

Considering these challenges, many seniors and their families seek alternatives that allow for greater independence and comfort in their own homes. Innovative home-based care solutions, such as the VELA Independence Chair, are proving invaluable in this regard. These medically approved mobility chairs are designed specifically to offer enhanced safety and mobility at home, allowing seniors to perform daily activities like cooking and dressing with greater ease. They provide substantial support by reducing the strain on informal caregivers, ensuring that seniors can enjoy a higher quality of life while potentially delaying or minimizing the need for formal institutional care facilities.

Regulatory and Reimbursement Landscape for NAICS 623110 Entities

The regulatory environment for nursing care facilities has undergone important changes through early 2026. Notably, the Centers for Medicare & Medicaid Services (CMS) rescinded the federal minimum staffing standards for long-term care facilities, effective February 2, 2026. This rescission removes the requirements for 24/7 RN coverage and 3.48 hours of nurse/aide care per resident day, though enhanced facility assessments for resident acuity remain required[2][6][8][10][14]. As a result, operational cost pressures and regulatory staffing mandates present in prior years are no longer mandated by federal law.

The CMS Nursing Home Care Compare system was updated in mid and late 2025: it now bases quality ratings on only the two most recent health inspections (previously three) and incorporates additional reporting for entire nursing home chains. The revised Five-Star ratings place a new emphasis on recent surveys and antipsychotic use data in an effort to improve the reliability and accuracy of ratings[2]. Additionally, certification revalidation schedules have shifted, with extensions to January 1, 2026 reflecting ongoing policy adjustments and regulatory flux [2][5]. These updates aim to increase transparency, accountability, and enable more informed decision-making for residents and families.

In conclusion, understanding nursing home NAICS code 623110 offers invaluable insights into a sector anchoring healthcare and driving economic activity. As the healthcare landscape evolves, the needs and expectations of the nursing care industry do too. Balancing traditional nursing facilities with home-based care alternatives, like VELA chairs supporting mobility and independence, heralds a new era in senior care. Embracing both traditional and innovative methods will be essential to cater to diverse needs, ensuring comprehensive care solutions as the industry tackles future challenges and opportunities, reinforcing its role in supporting the aging population.

Supporting Aging in Place: A Practical Option

Mobility solutions like the VELA Independence Chair are powerful tools in helping seniors maintain their independence at home. These chairs address common challenges such as mobility and safety, offering features like a central brake system for stability, electric height adjustability to assist with transfers, and ease of movement while seated, which collectively support daily activities and reduce caregiver burden. By incorporating such tools into home environments, seniors can experience enhanced dignity and freedom—key aspects that contribute to a higher quality of life. Without such solutions, simple tasks could become overwhelming, potentially accelerating the need for nursing home care. While VELA is one practical and effective choice, exploring various mobility aids and adapting homes accordingly remains essential in supporting aging in place. VELA Chairs for Seniors and Enhancing Mobility Solutions underscore the positive impact these solutions have in a caring environment.

References and Sources

FAQ

What is the NAICS code for nursing homes in the United States?

The NAICS code for nursing homes in the United States is 623110. This code specifically covers Nursing Care Facilities, also known as Skilled Nursing Facilities, that provide inpatient nursing and rehabilitative services with a permanent staff of registered or licensed practical nurses.

How does the NAICS code 623110 affect the operations of skilled nursing facilities?

NAICS code 623110 plays a critical role in the operations of skilled nursing facilities by providing a clear classification that helps with industry analysis, regulatory compliance, and research. It enables stakeholders to better understand the facility’s place within the healthcare sector and supports proper regulatory alignment and financial planning.

How do nursing homes benefit from using the appropriate NAICS code for their business operations?

Using the correct NAICS code, such as 623110 for nursing homes, ensures alignment with industry standards. It aids in regulatory compliance, facilitates accurate industry analysis, and allows for better access to funding or reimbursement programs. Accurate classification is essential for navigating the complex healthcare landscape effectively.

How does the NAICS code 623110 impact funding or financial support for nursing care facilities?

The NAICS code 623110 helps nursing care facilities align with healthcare reimbursement systems such as Medicare and Medicaid. For instance, an anticipated 4.2% increase in Medicare payments for 2025 impacts operational budgets and helps facilities adapt to rising costs. Being correctly classified supports financial planning and access to appropriate funding channels.

What are the common concerns or challenges faced by establishments using NAICS code 623110 for skilled nursing facilities?

Facilities under NAICS code 623110 face challenges such as fluctuating reimbursement structures from Medicare and Medicaid, increased operational costs, and regulatory compliance demands. Staffing requirements and adapting to policy shifts are ongoing concerns, especially as the aging population increases demand for services while also driving scrutiny and reform efforts.

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Author

  • Assistive Technology Specialist & Senior Mobility Consultant

    I specialize in helping older adults live safer, more independent lives through smart, practical assistive solutions. With a background in emergency medicine and over a decade in the assistive tech field, I bring a grounded, hands-on perspective to aging in place. Whether it's recommending the right grab bar, configuring a voice-activated home system, or teaching a family how to use a lift chair properly, I focus on real-world solutions that make daily life easier for seniors and less stressful for caregivers. From small towns to city homes, I've worked with hundreds of families, healthcare providers, and housing specialists to design environments that promote dignity and comfort in later life.