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Continuing Care Retirement Communities: A Guide

There are three distinct phases to living in a continuing care retirement community (CCRC). The first is independent living when a resident enters into the community with few if any disabilities requiring limited assistance. In this phase of independent living, community residents typically take advantage of the broad range of social, physical, and intellectual offerings. The second phase is assisted living, which includes long-term personal senior care support services that include help with activities of daily living like medication management, bathing, meals, dressing, and transportation. The third phase is nursing home care, also known as a skilled nursing facility. This third phase addresses a resident’s requirement for 24-hour monitoring and medical assistance in the case of serious injury or severe illness. Nursing home care locations within the CCRC are usually located near an associated hospital if the need arises for acute care or hospitalization. The linked three phases of a CCRC provide a continuum of care so that a resident can spend the rest of their days moving between the levels of care as needed.

These residencies are also referred to as life plan communities, active adult community homes, and lifetime communities. CCRC’s vary from state to state and have no licensing by one oversight entity. There is no reliable data as to how many seniors are living in CCRC’s, but it is evident that continuing care within one inclusive community is gaining popularity. One way to distinguish a well-maintained and safe CCRC is through the Commission on Accreditation of Rehabilitation Facilities (CARF). This organization is America’s only accrediting body for these types of communities and is an independent, non-profit organization focusing on advancing the quality of services to meet the residents’ needs and provide the best possible outcome. The Continuing Care Accreditation Commission, also known as CARF-CCAC, is a valuable reference when researching a move into a CCRC.

Opting to live in a CCRC is a costly senior housing option and requires due diligence and careful financial planning to optimize the experience. Payment plan specifics are different at each CCRC; however, an entrance fee is required. These entrance fees can be as little as $10,000 and as expensive as $500,000. Most CCRC’s do not allow ownership of the residence; however, a monthly maintenance fee requires additional monies ranging between $200 and $2,000. The residence is just one part of the contract negotiation. Health care coverage and costs are typically broken down into three fee schedule options. The first is an extensive contract, which is the most expensive. It provides the resident with unlimited access to healthcare with little or no monthly maintenance fee increases. The second is a modified contract that offers a resident unlimited access to healthcare, but healthcare is paid for as needed, and monthly maintenance fee increases offset this pay for healthcare as needed approach. The third is a fee-for-service contract, and while it seems like a conservative spending approach if the aging resident eventually requires extensive healthcare, it is costly. This fee schedule option allows residents to pay for all health care costs separately.

Websites that offer advice on senior living options like aPlaceforMom suggest that the admission agreement for a CCRC should cover

  • The three residence phases
  • Fee schedule options
  • Health care coverage
  • Cancellations and refunds
  • Services
  • Insurance requirements
  • Conditions for transfer within the community to other levels of care
  • What the CCRC’s responsibility is if a resident becomes unable to pay fees.

Contract review by a trusted lawyer or financial advisor is of the utmost importance. Contracts should include a clause that addresses refunds in the event a resident leaves the CCRC and, like the fee for service health care options, most CCRC’s have multiple agreement choices that offer varying degrees of refundability. In the past, most continuing care retirement communities were non-profit organizations, but today, many CCRC’s are a for-profit business. Check into the possibility that the business entity of your retirement living arrangement may one day be sold and understand how that would affect a residential contract.

It is essential to ask relevant questions when researching a particular continuing care retirement community, such as:

  • What if assisted living and nursing home facilities that are part of the CCRC are full when I need them?
  • Is there a reciprocal agreement between the CCRC and nearby communities?
  • What type of background checks are done for staff members?
  • What is the staff-to-patient ratio in each phase of living?
  • How can a resident participate in the organization’s decision-making?
  • What type of memory impairment (or dementia) services are available?

The above questions are good starting points to learn everything possible about a particular CCRC. Some items will be specific to your health, financial situation, and family relationships. We often help families with determining the right type of living situation for senior family members.  If we can assist you or a loved one, please don’t hesitate to reach out.

We hope you found this article helpful. If you’d like to discuss your legal matters, please don’t hesitate to contact our Guntersville office at 256-486-3407. We look forward to the opportunity to work with you.

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