How To Start An Assisted Living Facility In New Mexico

Starting an assisted living facility is an opportunity to provide compassionate care to seniors who need help with daily living activities but wish to maintain independence. Since the aging population is steadily increasing, the demand for quality elder care services is growing.

There are specific regulatory requirements, licensing procedures, and facility standards that must be met to ensure safety and compliance in New Mexico. Whether you are a healthcare professional, investor, or entrepreneur, it is important to understand the legal, financial, and operational aspects which is pivotal for success. This guideline will help you to start and operate a licensed assisted living facility in New Mexico effectively and responsibly.

If you want one-on-one help mapping these steps to your specific project, you can also book a licensing consultation with a CarePolicy.US specialist for New Mexico and other states.

Understand New Mexico’s assisted living regulations

One of the most critical steps in starting your facility in New Mexico is understanding New Mexico’s assisted living regulations. The New Mexico Health Facility Licensing and Certification program, currently housed within the New Mexico Health Care Authority and working under regulations issued by the Department of Health, oversees and manages the licensing and regulation of assisted living facilities statewide. 

These regulations are designed to oversee the requirements for staffing, resident rights, medication management, safety, emergency preparedness, and physical facility standards. New Mexico’s assisted living facilities are governed primarily by 7.8.2 NMAC, “Assisted Living Facilities for Adults.” 

Rather than separate licenses for different assisted living types, New Mexico issues an assisted living facility license and then applies additional, more stringent requirements to any facility that operates a secured memory care unit for residents with Alzheimer’s disease or other dementias. 

Once you understand the assisted living regulations and any additional memory care requirements that may apply to your facility, familiarize yourself with how these rules affect your preferred operating model so that the facility operates legally and ethically and prepares you for the application, inspection, and ongoing compliance process.

For the most up-to-date regulations, you should review:

• New Mexico Health Care Authority – Assisted Living Facilities portal (licensing and survey information) 
• 7.8.2 NMAC – Assisted Living Facilities for Adults (core facility requirements) 

Choose the type and size of facility

When starting an assisted living facility in New Mexico, choosing the appropriate type and size of a facility is one of the key decisions that you have to make. This will directly impact your licensing, staffing, budget, and overall operations.

New Mexico licenses assisted living facilities as a single facility type but recognizes that some communities also operate secured memory care units for residents with dementia. Memory care units must meet additional requirements related to service planning, assessments, staffing, training, security, and resident rights.

Assisted living facility (ALF)

Assisted Living Facility (ALF): Designed for residents who need help with daily activities but not extensive medical care. ALFs provide supervision or assistance with activities of daily living, medication assistance, meals, housekeeping, and social activities, but they do not provide 24-hour skilled nursing care like a nursing home.  

Assisted living with memory care

Some assisted living facilities also operate secured memory care units for individuals with dementia, Alzheimer’s, or related conditions. In New Mexico, these units must meet more stringent requirements for care coordination, staff training, assessments, individual service plans (ISPs), documentation, security, and ongoing evaluation to ensure the secured environment is appropriate for each resident.

Capacity and resident mix

You’ll also need to decide on the facility’s capacity. Under 7.8.2 NMAC, an assisted living facility is any facility that is operated for the maintenance or care of two or more adults who need or desire assistance with at least one activity of daily living. The rule does not apply to the residence of an individual who maintains or cares for a maximum of two relatives in their own home. 

Your choice should be based on your experience, expectations, budget, and the availability of property. Smaller facilities are designed to offer a homelike atmosphere and more personalized care, while larger ones are designed to support a broader range of services and residents. First, carefully evaluate the market demand, zoning regulations, and building requirements. The type and size of your facility must align with state standards, ensuring long-term compliance and sustainability. Remember that your licensed capacity will be set by the licensing authority based on applicable building, life safety, water, waste, and sanitation standards. 

As you refine your concept, it can be helpful to compare New Mexico’s rules to other states using broader guides, such as CarePolicy.US’s 50-state assisted living startup guide, so you can position your facility competitively in a regional or multi-state market. 

Business structure and licensing

Establishing the right business structure and obtaining a proper license to operate in New Mexico is essential in starting an assisted living facility in New Mexico. Your business structure affects and defines many things, from taxes to liability and daily operations. Most assisted living facilities opt for one of the following legal structures.

• Sole Proprietorship – Easy to set up, but offers no personal liability protection.
• Partnership – Suitable for two or more owners, but still involves shared liability.
• Limited Liability Company (LLC) – Offers flexibility and liability protection; a popular choice in the healthcare sector.
• Corporation – Best for larger operations, with strict regulations but strong liability protection and easier access to investors.

Before proceeding, consult with legal and financial professionals to determine the most suitable structure that aligns with your goals.

Once you decide on your business structure, the next step is licensing, which is mandatory for legally operating an assisted living facility in New Mexico. The Health Facility Licensing and Certification program at the New Mexico Health Care Authority (historically part of the Department of Health’s Division of Health Improvement) is the governing body responsible for licensing assisted living facilities.

CarePolicy.US can help with understanding and managing this complex licensing process with templates and expert consultations tailored to your facility type.

For providers who want a done-with-you experience, you can schedule a New Mexico-focused licensing consultation through CarePolicy.US to walk through each application step.

Licensing steps in New Mexico

New Mexico does not have a Certificate of Need (CON) requirement for assisted living facilities or other health facilities. The state is listed among the jurisdictions that do not operate a CON program, so you do not need a CON approval to open an assisted living facility, although you must still fully comply with licensing and building requirements. 

Instead, the licensing pathway is driven by 7.8.2 NMAC and by the Health Facility Licensing and Certification program’s application process.

Key steps typically include:

• Submit a Letter of Intent (LOI) – Begin by submitting a written letter of intent to the Health Facility Licensing and Certification program at facility.license@hca.nm.gov. Your LOI should include the proposed physical address, the primary population you will serve, and a summary of the services you intend to provide. Once the LOI is received and accepted, an application packet (including the application form, fee schedule, and applicable regulations) will be issued. 
• Prepare your program narrative – Draft a program narrative describing the characteristics of the population to be served, the services and care to be provided, the professional and support staff, and any contracted services (such as hospice or home health agencies) you plan to use. 
• Register your business – File your chosen business entity (LLC, corporation, etc.) with the New Mexico Secretary of State and obtain any required trade name registrations.
• Apply for tax IDs – Obtain an Employer Identification Number (EIN) from the IRS and register for any required state-level tax accounts.
• Secure zoning and building approvals – Confirm that your proposed site is properly zoned for an assisted living facility and obtain needed approvals, such as building permits, a certificate of occupancy, and approvals for water, liquid waste, and sewage systems from the relevant local or state authorities. 
• Complete the license application – Submit the completed and notarized license application and the appropriate non-refundable fee to the licensing authority, along with all required attachments, including:
  • Your program narrative.
  • Annotated policy and procedure manuals that crosswalk your policies to the applicable rules (including 7.8.2 NMAC and related NMAC chapters). 
  • Floor plans and building plans prepared by a licensed architect, for life safety code review and approval. 
  • Evidence of zoning, fire, environmental, and occupancy approvals as required.
• Staffing plan and policies – Develop and submit documents on employee qualifications, background checks, criminal history screening (under 7.1.9 NMAC), staff training, resident care plans, medication assistance, incident reporting, infection control, and emergency procedures, consistent with 7.8.2 NMAC. 
• Board of Pharmacy approval (if handling medications) – If your facility will store or administer medications, obtain approval from the New Mexico Board of Pharmacy before licensure, as directed in the application packet. 
• Life Safety Code inspection and temporary license – After construction or renovation is complete and once you have your certificate of occupancy and local fire and environment department inspections, the state will schedule a Life Safety Code inspection. Upon successful completion, a temporary license may be issued, which allows you to admit a limited census while preparing for the initial health 
• Initial health survey and annual license – Once the facility is fully operational and serving residents, you must request an initial health survey. If the facility is found in substantial compliance with applicable rules, an annual license will be issued. Licenses must be renewed annually and updated when there are changes in location, capacity, administrator, or program. 

Licensing steps are detailed on the New Mexico Health Care Authority – Health Facility Licensing and Certification website and in the 7.8.2 NMAC regulations. 

Develop a comprehensive business plan

Developing a comprehensive business plan is critical for launching a successful assisted living facility in New Mexico. This plan will serve as the roadmap, helping attract investors, secure funding, and maintain operational clarity. It should outline your vision, target market, and financial strategy while complying with New Mexico’s regulatory expectations.

Key components of your business plan should include:

• Executive Summary – Brief overview of your mission, services, and business goals.
• Market Analysis – Research on local demographics, competition, and demand for assisted living.
• Services Offered – Details on care levels (basic assisted living, optional memory care, wellness programs, etc.).
• Marketing Strategy – How you’ll attract and retain residents.
• Operational Plan – Staffing, daily operations, management structure.
• Financial Projections – Start-up costs, revenue forecasts, and break-even analysis.
• Licensing & Compliance – Steps to meet New Mexico’s legal requirements and maintain ongoing compliance.

To save time, you can adapt a structured, healthcare-focused business plan template instead of starting from scratch. CarePolicy.US offers a ready-to-edit home care and assisted-services business plan for any agency and any U.S. state that you can customize for your New Mexico assisted living facility.

Secure a suitable facility and location

Picking the right facility and location is crucial in regards to pulling in residents and keeping them safe and comfortable. The location has to adhere to New Mexico building and zoning regulations, offer accessibility features, and be located in a healthcare-locatable area and in a community with a demand for elder care. Look for properties that can be modified for safety features like handrails, emergency exits, and ADA-accessible bathrooms.

Seek proximity to health care facilities, pharmacies, and transportation. A warm, home-like environment with outdoor spaces can enhance resident satisfaction and marketability.

When designing or renovating the building, consider New Mexico’s minimum physical plant requirements, such as having at least one toilet, sink, and bathing unit for every eight residents, providing accessible bathrooms in larger facilities, and meeting water, sewage, fire safety, and emergency lighting standards. 

Hire and train qualified staff

Hiring compassionate and trained staff ensures quality care and New Mexico regulation compliance.

• Hire licensed administrators, caregivers, and nurses.
• Conduct background checks and verify credentials, including fingerprint-based criminal history screening and checks of the state’s employee abuse registry, in accordance with 7.1.9 NMAC and 7.8.2.16 NMAC.
• Comply with minimum staff training hours required by the state:
  • At least sixteen (16) hours of supervised training for each new employee or volunteer providing direct care, before they provide unsupervised care. 
  • At least twelve (12) hours of additional training annually, covering topics such as fire safety and evacuation, first aid, food safety for staff who handle food, infection control, confidentiality, resident rights, abuse/neglect reporting, emergency procedures, and medication assistance. 
• Provide ongoing training in geriatric care, safety, and emergency procedures, and ensure that staff who work in memory care units receive additional dementia-specific training as required by 7.8.2 for memory care units. 
• Document staff education on documentation standards, HIPAA compliance, and person-centered care, keeping all records in personnel files.
• Maintain adequate staffing levels according to resident needs and at least meet the minimum state staffing ratios, which require at least one awake direct care staff for each fifteen residents during waking hours and defined minimums for overnight staffing based on facility census. 

Policies, procedures, and care plans

Well-defined policies and procedures will ensure consistency, compliance, and high quality of care. A few of these will be the emergency response, drug handling, admissions/discharges, and infection control.

New Mexico regulations require facilities to have written personnel policies, admission and discharge policies, policies for medication administration and assistance, incident reporting, abuse/neglect reporting, dietary services, and physical plant operations. These policies must be implemented in practice and kept up to date. 

Care plans (individual service plans, or ISPs) must be person-centered, reviewed regularly, and informed by feedback from residents, families, and the medical team. Each resident must have an evaluation and ISP that covers their needs, services to be provided, and goals, and the ISP must be updated at least every six months or sooner if the resident’s condition changes.

To make it easier to do so, you can utilize templates and crosswalks that are mapped to New Mexico rules. CarePolicy.US offers an any-agency-type customized policies and procedures service for New-Mexico licensure, which can be tailored to New Mexico’s assisted living requirements and your specific program.

If you are also planning to operate a home care agency alongside your facility, you may want to align your documents by using the non-medical home care agency policies and procedures for New Mexico state licensure as a companion resource.

Marketing and community outreach

Good outreach and marketing fill all beds and create a positive reputation. Establish a strong brand and market your facility through a professional website, social media, local media, and senior service directories. Host open houses, community events, or free wellness screenings to establish relationships with families and referral sources. Build relationships with hospitals, clinics, and elder law attorneys for constant referrals. Digital and local engagement approaches will heighten awareness and credibility.

It can also be helpful to collaborate with local Area Agencies on Aging and community organizations listed in New Mexico senior-care resource directories to ensure potential residents and families can find your assisted living community. 

Maintain compliance and prepare for inspections

To remain licensed, New Mexico assisted living facilities must comply with state regulations and undergo regular inspections. Review policies annually, adjust staff training, and update documents. Conduct internal audits and safety checks. Being proactive will keep you passing inspections and not being penalized.

New Mexico’s Health Facility Licensing and Certification program conducts life safety and health surveys to evaluate compliance with 7.8.2 NMAC and related rules. Facilities are responsible for maintaining documentation, including up-to-date ISPs, medication records, incident reports, staff training records, background checks, and inspection reports. 

Regularly monitor updates from the Health Care Authority, the Department of Health, and federal agencies (such as the CDC and CMS) to align your infection control, emergency preparedness, and operational policies with current guidance. 

For owners who prefer ongoing expert support, CarePolicy.US offers continuing licensing and policy consultation services across all states that can be especially helpful when regulations change.

Conclusion

Creating an assisted living facility in New Mexico involves planning, compliance, and care. With the right team, building, and support from sites like CarePolicy, you can build a successful and nurturing community that meets regulatory standards and enhances the quality of residents' lives.

By understanding New Mexico’s assisted living regulations, choosing the right facility type and size, building a solid business plan, preparing a compliant facility, hiring and training qualified staff, implementing strong policies and care plans, and maintaining ongoing compliance, you can launch and grow a facility that serves seniors and their families well for years to come.

FAQs about starting an assisted living facility in New Mexico

Do I need a Certificate of Need (CON) to open an assisted living facility in New Mexico?

No. New Mexico is one of the states that does not operate a Certificate of Need program for health facilities, so you do not need a CON to open an assisted living facility. You must still meet all licensing, building, zoning, and life safety requirements described by the Health Facility Licensing and Certification program and 7.8.2 NMAC. 

Who regulates assisted living facilities in New Mexico?

Assisted living facilities in New Mexico are regulated by the Health Facility Licensing and Certification program, which is part of the New Mexico Health Care Authority and operates under regulations issued by the Department of Health, including 7.8.2 NMAC. 

How many residents can my assisted living facility have?

New Mexico’s rules define an assisted living facility as any facility that cares for two or more adults needing assistance with at least one activity of daily living, but they do not set a single statewide maximum census. Instead, your licensed capacity is determined during the application process based on your building design, life safety and construction standards, water and sewage systems, and staffing capabilities. Your license will specify the maximum number of residents you may serve.

Does Medicaid help pay for assisted living in New Mexico?

Medicaid does not pay for room and board in assisted living, but New Mexico’s Medicaid program (Centennial Care) offers home- and community-based services waivers that may cover certain services delivered in an assisted living facility for eligible residents, such as personal care and supportive services. 

What are the minimum staffing and training requirements?

New Mexico requires at least one awake direct care staff member on duty at all times for each fifteen residents during waking hours, with additional staff required overnight as census increases. Direct care staff must complete at least 16 hours of supervised training before providing unsupervised care and at least 12 hours of annual training thereafter, covering defined topics such as fire safety, first aid, infection control, resident rights, and abuse/neglect reporting.