A Continuing Care Retirement Community, or CCRC, is a type of living arrangement that provides a continuum of care from minimal assistance to nursing home care. The CCRC makes it possible for older adults to transition from independent living to nursing home care without leaving the premises. CCRCs provide lifetime housing, social activities, and increased levels of care as needs change.
Typically, residents of CCRCs start by moving into their own apartment in the CCRC complex. The living spaces have everything a person needs to live independently. As a resident’s needs increase, the level of care increases, as well. For instance, a person living in their own apartment at first may need help cleaning and doing laundry. Or, if they do not want to, or are not physically capable of cooking, they may also decide to take more of their meals in the community dining area. When a resident needs help with daily activities such as taking medication or bathing, the resident can hire companions and homemakers to provide care in his or her apartment. When a serious health condition such as a stroke, or advanced Alzheimer’s Disease develops, the resident can move to a skilled nursing care facility on the CCRC campus.
How Do You Pay for Continuing Care Retirement Communities (CCRCs)?
There are three ways to pay for a continuing care retirement community. All three CCRC contracts cover shelter, amenities, residential services, and any short-term and emergency care:
- Extended Contract: Unlimited long-term nursing care with no corresponding increase in monthly payments. This is the most expensive contract, but may prove to be the most cost-effective in the long run.
- Modified Contract: A specific amount of long-term nursing care in the monthly payments. Once the specified amount is used, the resident must pay for any additional nursing care.
- Fee-for-service Contract: Initially, this is the least expensive plan. But, residents must pay for all future long-term care at daily nursing care rates separately from the contract.
Most CCRCs have an entrance fee that is partially refundable depending on how long you live in the CCRC. In addition, CCRCs charge a monthly fee. CCRCs differ widely on entrance fees and monthly rates, so you need to compare them.
How Do You Pick a Continuing Care Retirement Community?
It is important to thoroughly research the financial health of any CCRC you are considering. A CCRC in financial trouble may file for bankruptcy leaving the residents without a home and no recourse. From the disclosure statements provided by the CCRC, you can determine if the CCRC has incurred substantial debt that may cause the CCRC to close.
Our Southeastern Connecticut Senior Services Guide includes a list of 98 questions designed to help you gather all the information you need to make an informed decision when choosing a CCRC. The guide includes questions about:
- The financial health of the CCRC
- The entry fee and whether it is refundable or tax deductible as a medical expense
- What is included in the monthly fee and how/when it can be increased
- What is included in the living unit and all the maintenance and social /recreational services provided
- What health care services are provided at what point and what happens if the CCRC cannot provide the type of care needed
- How this complex purchase impacts your specific financial situation
As estate planning attorneys, we have helped many clients over the years figure out whether a CCRC is the right choice for them. We take the time to listen to your concerns and pour over your financial information to determine what you can afford. We will analyze the CCRC’s Resident Agreement to let you know what risks you will take in moving to a specific CCRC. Give us a call if you are considering a move to a CCRC.
