America has an aging population, and as such, more and more people are considering options for where and how they’ll live after retirement. Overall, 70% of people currently age 65 or older will need some kind of long-term care according to the federal government.
Sorting through the myriad choices for long-term care and determining which is the best one for your particular situation can be challenging.
What Is CCRC?
A continuing care retirement community, which can also be known as a life plan community, is one option you may consider. CCRCs offer most anything older adults may need as they move through the stages of aging, says Andrew J. Carle, an adjunct professor and lead instructor for the program in Senior Living Administration at Georgetown University in Washington, D.C. “The gist of it is they (CCRCs or LPCs) include the full continuum of care options,” meaning everything from independent or assisted living to memory care and skilled nursing care.
There are about 1,900 CCRCs nationwide, according to the AARP.
Whether a facility goes by CCRC or LPC, these communities typically all include at least these options:
— Independent living. Independent living can be a good option for seniors who like living independently but like having access to assistance to medical care, dining and housekeeping services when they need it. Many independent living communities provide one meal per day in a cafeteria setting.
— Skilled nursing care. This type of community is geared toward individuals who need skilled, licensed nursing care and medical attention. This could include people who have had a serious stroke, who have serious heart, kidney or respiratory conditions and people who aren’t ambulatory.
Most also include other care options, including:
— Assisted living. Basically, assisted living is for seniors who can live independently but need help with some daily tasks, such as cooking, housekeeping and keeping track of medications. Assisted living communities typically have a pharmacy on site.
— Memory care. Memory care units are for people with dementia who exhibit certain kinds of behavior that affect their day-to-day living. Such units have staffers who are trained to provide specialized care to people with dementia.
— Short-term rehabilitation. This type of facility provides around-the-clock therapeutic services and medical care for patients who are recovering from a surgery, a serious illness or an accident. The goal is to help the patient achieve recovery to the point they are independent enough to no longer need such care. Patients typically stay in a short-term rehabilitation setting for a few weeks, but stays can last for months.
[READ: How to Coordinate a Parent’s Care With Siblings.]
Range of Services
Many CCRCs or LPCs communities have minimum age requirements, starting at age 60 or 62, says Carol Ann McCormick, director of marketing and sales for Knollwood, a life plan community in Washington, D.C.
CCRCs address the range of needs seniors will face as they age and typically offer housekeeping and dining options, transportation, wellness and fitness programs, recreational activities and a wide range of social activities and outings for residents.
The independent living area of the community typically comprises the largest percentage of the community’s population, she says. People who live in independent living communities are still running their household, in charge and generally looking for an easier lifestyle, maybe to continue their career.
“The assisted living and skilled nursing areas are typically sized for fewer people, as not all residents who live in independent living end up needing help or care,” McCormick says. Some people who choose to live in a continuing care retirement community are serious planners and prefer avoiding worrying about what to do if they need to seek help or care in the future, she notes.
What to Consider When Choosing a CCRC
If you or a loved one is considering a CCRC or an LPC, it’s important to know the costs and how to pay for them, as well as other facts about the facilities.
Here are six issues to think about when you’re considering a CCRC or an LPC:
1. Medicare and Medicaid don’t pay for independent living. Medicaid pays for assisted living under limited circumstances.
First, it’s important to know than that neither Medicare nor Medicaid pay directly for CCRCs or LPCs. They are federal health insurance programs and pay for care under specific circumstances. Medicare is a federal health insurance program for people age 65 or older, certain people with disabilities and individuals with end-stage renal disease. Medicare does cover some specific services that a CCRC resident might receive outside of the community, such as hospitalization and the services of a doctor.
Carle adds that “Medicare covers up to 100 days of skilled nursing, and if you have it (while you live in a CCRC) you can use that” if and when you transition from the independent or assisted living part of the CCRC to the skilled nursing care area. But by and large, Medicare is not part of the equation when talking about how to fund living in a CCRC. Most people who opt to reside in CCRCs are funding the stay out-of-pocket and have the personal financial resources to do so.
Medicaid is a state-operated health insurance program, with funding from the federal government, that provides coverage to about 77 million Americans, including low-income adults, children, elderly people, individuals with disabilities and pregnant women. In some regions, Medicaid might include assisted living, depending on what the state has decided to cover, McCormick says. People on Medicaid are income qualified. “Medicaid is most often used to cover nursing costs for people who are in need of care,” she says. “One must meet income and asset eligibility to be able to access Medicaid funding.”
Individuals who are paying the monthly cost of living in a CCRC would be unlikely to qualify for Medicaid assistance. In some regions, people who depleted their life savings and meet income and asset eligibility requirements can use Medicaid to cover skilled nursing home costs.
[READ: Assisted Living Checklist.]
2. Cost of CCRC
There are two basic pricing models for CCRCs and LPCs, Carle says: the entrance fee framework and the straight rental model.
Under the entrance fee model, residents pay a large fee up front and also pay a monthly fee, McCormick says. The upfront amount can range from $100,000 or less to $1 million or more. Many residents pay an upfront charge of between $200,000 to $500,000. That’s a lot of money, but Carle notes that most older adults own their home. The idea behind CCRCs is that homeowners can sell their home to pay for a CCRC or LPC.
About 76% of households in the U.S. age 50 or older own their homes, according to the Joint Center for Housing Studies. “The pricing model has essentially always been the idea that you trade your old home for a new one, that may be smaller, but includes extensive common areas, amenities and services to meet almost all of your daily living expenses,” Carle says.
Life care. There are typically a variety of payment plans, depending on the level of care you need. It’s important to understand exactly what services each plan offers. Choices include a fixed-price, all-inclusive option that offers access to every level of care without additional charges (sometimes known as life care). This financial arrangement could be a good option for someone entering the facility while they’re still healthy and able to live independently. Then, as their needs change, they’re guaranteed skilled nursing care with little or no monthly change to their monthly fee, aside from annual price adjustments, McCormick says.
It’s the most expensive type of contract, “but essentially it guarantees all levels of services and care at a fixed price,” Carle says.
Modified life care. Another type of payment option that may be available is a modified contract (sometimes known as Modified Life Care) which provides services for a set period of time or for a specified discount or for a discount period. When that time or discount expires, if you need additional services, you can pay for them with a higher monthly fee.
Fee-for-service. Yet another approach is a fee-for-service contract where you pay only for the services you use. This may lower your initial costs if you start out in independent living, but if you later need assisted living or skilled nursing care, your costs will go up.
You can buy a long-term care insurance plan to help pay the costs of living in a CCRC. You can also use other types of income, such as savings and investment funds and Social Security.
Under the straight rental model, you may pay a modest move-in fee — typically a few thousand dollars — and pay a monthly rental charge for whichever type of housing and care you need.
“You pay for it as you need it,” Carle says. Consumers can use the funds they otherwise would have used to pay the large entrance fee and invest the money or use it for other purposes.
The cost of monthly rents vary, depending on geography. For example, independent living may cost between three to six thousand dollars a month. Skilled nursing would cost an additional $200 to $600 a day, bringing the monthly cost to about $8,000 to $16,000 a month, McCormick says.
3. CCRC Certification
Some CCRCs participate in an accreditation process conducted by the Commission on Accreditation of Rehabilitation Facilities, an international non-profit organization. There’s no requirement that CCRCs obtain such accreditation, and most such communities are not certified by CARF, Carle says.
Here’s how the accreditation process works, McCormick says: A survey team of industry peers conduct on-site surveys of communities. The peers take a consultative, not an inspective, approach.
The members of the inspection team:
— Interview staff.
— Observe organizational practices.
— Review documents.
— Suggest ways to improve service delivery.
To participate in the accreditation process, a CCRC must have the resources to have its own staff leave to help review other communities. Not all small communities can afford this level of participation.
Accreditation lasts for five years. Between accreditations, facilities must provide annual reports to CARF.
There are several ways that have nothing to do with CARF accreditation to evaluate CCRCs and whether they are right for your loved ones, says Larry Gerber, president and chief executive officer of EPOCH Senior Living in the greater Boston area. EPOCH offers an array of living arrangements and services, including independent living, assisted living and memory care.
To learn more about a specific CCRC, Gerber suggests these approaches:
— Asking to speak to current or past residents of the CCRC. Most community operators will oblige, and some will invite you to have a meal with current community residents. Some will allow a weekend stay in a guest suite. These meals and visits would typically apply to an independent living community.
— Check with your state consumer and regulatory affairs departments to see if there’s a history of complaints against the CCRC.
— Conduct online searches for consumer reviews. For example, you could check Yelp.
4. Timing
There’s some math involved in determining whether a CCRC is your best choice and when you should move in. Ideally, you’d enter while you’re still healthy and able to live independently to take full advantage of all that these facilities have to offer, but Carle says many people put off making the decision and end up entering CCRCs or assisted living facilities later on when they’re perhaps less healthy or unable to live independently.
Keep in mind that not all CCRCs will have an opening for you in assisted living or skilled nursing care if you haven’t lived in that community’s independent living section first.
[Read: 24 Gift Ideas for Nursing Home Residents.]
5. Location
As with real estate, it’s important to think about location if you’re considering a continuing care retirement community. Many CCRCs are in remote settings. A beautiful countryside setting may be tranquil, but Carle says many of today’s retirees, which include many baby boomers, are less interested in living on what they view as an “elderly island” separated from the rest of the world. So consider where you want to live — close to family? In an urban environment? By the beach?
Some CCRCs are beginning to crop up in vibrant downtown locations and on college campuses around the country. “Baby boomers are (as a group) well-educated and many don’t consider themselves old and want to maintain contact with the rest of the world,” Carle says.
6. Questions to Ask
In addition to asking whether you can talk to current or former residents or have a meal or spend a weekend in the independent living community, you could also ask questions about exactly what services and amenities are offered and inquire whether there are opportunities to be involved in a residential council. Such councils typically represent the concerns of residents with the administration, giving them a say in how the community operates. Ask how long the council has been in existence and how often it meets. You can also ask to read some of the minutes of meetings.
You can also ask for financial reports, which can help you decide whether the CCRC is on solid financial footing. You can also ask for inspection reports and complaints. The community’s administration should provide those on request, which could save you phone calls or a trip to a state regulatory agency.
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What to Know About Continuing Care Retirement Communities originally appeared on usnews.com
Update 04/13/23: This story was previously published at an earlier date and has been updated with new information.
