How must i discuss difficult news like needing a nursing home with my elderly parent?

It is difficult: If possible, i would try and get your siblings (if you have some) as well as other family members involved in the entire process. It is very difficult for parents as well as for the children involved when it comes to needing nursing home placement. Perhaps there is a therapist, like a social worker in your area who can give you some ongoing assistance. Most nursing homes employ such an individual.

Challenging issue: I agree with dr. Passer that this is a very difficult situation. Sometimes siblings and family members disagree about these things, which makes it even harder. Geriatric care managers may be able to help -- these are often nurses and social workers with special skills in dealing with elderly people & their families. You can find some in your area by searching: http://www.Caremanager.Org/.