Continuing Care Retirement Communities

Continuing care retirement communities (CCRCs) offer seniors long-term contracts that guarantee lifelong shelter and access to specified health care services. In return, residents usually pay a lump-sum entrance fee and regular monthly payments. Depending on the contract, the entrance fee may be nonrefundable, refundable on a declining basis over time, partially refundable, or fully refundable. CCRC residents enjoy an independent lifestyle with the knowledge that if they become sick or frail, their needs will continue to be met.

Most CCRCs establish minimum requirements for incoming residents based on age, financial assets, income level, and physical health and mobility. In general, residents are expected to move into the community while they are still independent and able to take care of themselves.

Paying for a CCRC

There are three basic types of CCRC contracts: extensive, modified, and fee-for-service. An extensive contract covers shelter, residential services, and amenities, plus unlimited long-term nursing care without an increase in monthly payments (except for normal increases related to operating costs and inflation adjustments). An extensive contract spreads the risk of catastrophic health care costs among all the residents of a community, so that no single person faces financial ruin.

Entrance fees and monthly costs under extensive contracts are typically higher than those under modified or fee-for-service contracts. A modified continuing care contract covers shelter, residential services, and amenities, plus a specified amount of nursing care. After the specified amount of care has been received, the resident can continue to receive care on an unlimited basis but must pay for it at daily or monthly nursing care rates.

A fee-for-service continuing care contract covers shelter, residential services, and amenities. While emergency and short-term nursing care is usually included in the contract, access to long-term nursing care is guaranteed only at daily nursing care rates. Entrance and monthly fees are lower under this type of contract because residents are responsible for all long-term nursing and health care costs. It is highly advisable to have an attorney review a CCRC contract before any commitment is made.

Most CCRCs provide a variety of residential services, which may be covered by monthly fees or be available at extra cost, depending on the contract. Services routinely offered include meals, recreation facilities, apartment cleaning and maintenance, grounds maintenance, prescribed diet, transportation, utilities, and special care during illness.

The continuum of care offered in a CCRC typically begins with independent living in an apartment or cottage and proceeds through increasing levels of care, including personal care (or assisted living) when it is needed. Depending on the CCRC, personal care is provided in separate personal care rooms or in a resident’s own apartment. Costs for personal care services vary among contract types. Nursing care is provided by all CCRCs at costs specified in the contract. Most CCRCs have policies governing decisions about transfers from one level of care to another.

What to look for in a CCRC

Request an information packet from every CCRC you are considering. Read it carefully. Visit each one. Dine with residents; talk with staff; read the residents’ handbook. Assess the management’s philosophy and its relationship with residents, keeping in mind your own needs.