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Is a continuing care retirement community right for you or your parents?

Important questions to ask when considering an independent senior living community.

You’re in good health. You’re retired or thinking of retiring soon. Your home is starting to feel too big for you. What if you need long-term care one day?

Welcome to the CCRC.

A continuing care retirement community is a housing development for those 55+ that’s more than just an adult-only neighborhood. There are about 2,000 CCRCs nationwide and they offer a variety of housing options, from single-family homes to condominiums. And that’s just the start. On-site restaurants, salons, spas, dry cleaners and other services provide a completely self-contained environment for senior living. CCRCs also offer residents an array of activities – from golf to art classes, tennis to wine tasting, hiking to poker, as well as excursions to shopping, theaters and museums.

And should your health decline and you require long-term care, the communities allow you to move into their assisted-living, nursing home and memory care units – all on a guaranteed basis.

To move in, you’ll be required to pay an upfront fee; the average is $329,000 and can exceed $1 million. Some CCRCs do not refund this payment when you die or move out.

You’ll also incur monthly fees of $2,000 to $10,000, depending on the type of housing you select, the level of care you need and the services you would receive. The CCRC fees typically rise annually. There could also be occasional surcharges if occupancy rates fall or the operator experiences financial difficulties.

Throughout your life, you were able to move fairly easily if you didn’t like your home or neighborhood. Moving from a CCRC is much more difficult – both because of the often-irrevocable payment to move in and health issues that make finding and moving to a new home challenging.

And you may live in this retirement community for decades – meaning one that’s brand-new when you move in at age 65 today could fall into disrepair due to poor management over the years, right when you’re in your 80s.

This means you must evaluate a CCRC carefully. You should visit several senior living communities, each multiple times. Go on different days of the week, at different times of the day – even during different months of the year. Talk to as many staff and residents as you can to learn as much as possible about what it’s like to live there.

It’s a big decision, one that could impact your financial security during retirement, so don’t go it alone. Don’t sign anything until you’ve done your research and made visits. Read the accompanying list of 30 questions we recommend you ask the officers of a CCRC you’re considering, and get them answered. Then have your attorney examine the contract.

30 questions you should ask when considering a CCRC

If you or your aging parents are considering moving into a CCRC, we recommend you ask these 30 questions before you sign a contract:

 

  1. Who owns the facility?
  2. Who manages and maintains it?
  3. How much is the upfront fee?
  4. Is the CCRC fee refundable?
  5. If refundable, how secure is the guarantee to refund the fee?
  6. What will happen to the guarantee if the facility runs into financial difficulty?
  7. What are the CCRC monthly fees, and can these fees increase?
  8. Are rate increases applied to all residents when they occur?
  9. What has been the history of fee increases – amounts and frequency?
  10. What will be the monthly fee if higher levels of care are needed?
  11. If one spouse needs more care than the other, how will that change the monthly fee and their living arrangement?
  12. Who determines when you need to move to a higher level of care?
  13. What happens to your original unit when you move to a higher level of care?
  14. What would be the maximum cost if both spouses needed the highest level of care?
  15. Will you need to leave if you can no longer make your payments?
  16. If you can no longer pay, how quickly must you leave?
  17. Does the CCRC have any resources to cover your fees if you can’t pay?
  18. What extra costs might you incur if you are temporarily incapacitated – such as for transportation, laundry, help with medications, delivery of meals, etc.?
  19. What medical services are available on the premises?
  20. Is short-term rehabilitation provided – and at what cost?
  21. Under what circumstances might you need to pay for outside nursing assistance?
  22. Can the facility handle dementia and Alzheimer’s conditions on the premises?
  23. Are you guaranteed assisted living and nursing home care on the premises, or might you be moved to an outside facility for that?
  24. Is the CCRC certified by the Continuing Care Accreditation Commission?
  25. Is it certified by Medicare?
  26. Is it certified by Medicaid?
  27. What are the terms for ending the contract, either by you or by the CCRC?
  28. Will you receive up-to-date financial statements and contract terms?
  29. What occupancy rate is needed for break-even operations?
  30. What is the current occupancy rate?

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