The “ABCs” of Continuing Care Retirement Communities

ACTS Retirement-Life Communities, a not-for-profit senior housing and services organization, provides an overview of a popular type of retirement community known as a CCRC.

(Vocus) August 18, 2010

Continuing care retirement communities (CCRCs) are among the fastest growing type of senior housing. There are an estimated 1,900 CCRCs in the United States, and the number is expected to increase as baby boomers head into retirement. CCRCs are unique because they offer a range of retirement living options with country-club style amenities and access to future care if needed, including assisted living and skilled nursing care residences, usually on the same campus.

Seniors who live in a CCRC typically pay a one-time entrance fee and a monthly fee that covers maintenance, utilities, meals, activities and amenities. Fees for health care services provided in a CCRC vary. The three types of CCRC contract arrangements are known as Type A, B and C.

A Life Care Contract (called Type A) is similar to a pre-paid long term care insurance plan. Residents pay a nonrefundable entrance fee and a monthly fee, which are partially tax-deductible. With this all-inclusive contract the monthly fee does not increase if a higher level of health care is needed, such as assisted living and skilled nursing care. Type A contract is the preferred option for those who want predictable monthly payments.

A Modified Contract (Type B) typically offers a full or partially refundable entrance fee in addition to a monthly fee. Residents may receive a discounted rate for health care for a limited period, and the cost of assisted living and skilled care is on a fee-for-service basis. Entry deposits are refunded without interest when a resident leaves or to their estate when the unit is resold.

A Fee-for-service Contract (Type C) may initially offer a lower monthly service fee with a refundable entrance fee or no entrance fee. Residents must pay the full cost of health care services as they are needed at a price determined by the provider. Entry fee refunds occur similar to a Type B plan.

For those considering a CCRC, it’s important to find out what fees include, when fees are subject to increase and under what conditions. This is an important consideration as statistics show that approximately 70 percent of Americans over age 65 will need some form of long-term care. The average cost of long-term care nationally is nearly $80,000 per year, and is not covered by Medicare.

For more information about CCRCs visit http://www.actsretirement.org/guide.
ACTS Retirement-Life Communities is one of the largest not-for-profit CCRC providers in the country and offers a free downloadable resource called A Consumer’s Guide to Retirement Living that explains the range of retirement living options available, including checklists and worksheets to help research CCRCs and other types of senior communities.

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