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Seniors who choose to live in a continuing care retirement community (CCRC) report higher levels of satisfaction with life and a more positive life outlook. Those living in senior housing also experience better health outcomes, including fewer hospitalizations.
If you’re wondering, “What is a CCRC?”, it's a senior living community that offers different care levels, including independent living, assisted living, and skilled nursing. This allows seniors to remain in the same community, even if their care needs change. However, CCRCs aren’t right for everyone, and there are some potential drawbacks.
In this article, we’ll cover the care levels in a continuing care retirement community. We’ll also look at contract types, costs, and possible drawbacks. Together, this information can help decide if a continuing care retirement community is right for you or a loved one.
Community care retirement communities help seniors age in place. They offer access to amenities, services, and a supportive community.
CCRCs can offer financial predictability, but they come with high upfront costs. Plus, they require a long-term financial commitment.
When choosing a CCRC, consider budget, location, healthcare services, and amenities.
A continuing care retirement community offers independent living, assisted living, memory care, and skilled nursing care on one campus. CCRCs also have on-site amenities, such as fitness centers, swimming pools, walking trails, transportation, and beauty and barber shops.
Seniors in independent living live in private apartments or cottages, with amenities and services included. They lead active lives, enjoying social activities that help them connect with others in the community. People often choose independent living when they want to downsize their homes, seek a maintenance-free lifestyle, or wish to enjoy the amenities and social community it offers.
Seniors typically transition from independent living to assisted living when they start needing help with activities of daily living (ADLs), such as bathing, dressing, and eating. Assisted living provides support with daily activities, medication management, and personal care to help seniors stay as independent as possible.
Memory care provides a safe, secure environment and specialized programming for people with memory issues from dementia, Alzheimer’s disease, or other cognitive disabilities. Staff members in memory care facilities are specially trained and offer therapeutic activities, such as music therapy, art therapy, brain and memory games, and life skills. However, it’s important to note that memory care is not available in all CCRCs.
Skilled nursing care provides 24/7 medical care and rehabilitation services. Some people need skilled nursing care for the short term, such as when recovering from an illness, injury, or surgery. Others need long-term nursing care, such as those dealing with a chronic illness. Having skilled nursing care services available on campus is convenient, should there be any changes in health.
In this section, we’ll go over the types of contracts and how these impact continuing care retirement costs.
Life care contracts provide unlimited healthcare services. This means that costs are often higher upfront, but monthly costs can be lower, making long-term expenses more predictable. This option is often best for those prioritizing financial certainty.
Modified contracts offer limited healthcare services. They come with moderate entrance fees and monthly costs. A specified number of days or services is typically included, while extended care incurs additional fees. For example, a Type B contract might cover part of the transition from independent living to assisted living, but residents face additional costs. The benefits of modified contracts are that the upfront costs are lower than those of a life care contract. However, limits exist on what is included, and residents may encounter higher costs over the long term.
Fee-for-service contracts are cost-effective at first. People pay only for the healthcare services they need. This can offer financial flexibility and can be more affordable for healthy individuals. However, costs can get high for individuals who need more services over the long term, and, as you’re paying market costs, costs may be higher than what you would pay for the same healthcare services offered under a Type A or Type B contract.
With month-to-month or lease agreements, residents pay a monthly fee. This means that there are no upfront costs, and it may be a good option for those looking for something short-term.
With equity ownership models, residents buy a unit or share in the community. While this has higher upfront costs, it can build equity. It’s also important to note that there may be exit fees when leaving the community, so check for this when signing contracts.
The cost of CCRCs can vary depending on the location, unit size and type, amenities, and level of care needed. Most CCRCs use an entrance-fee model, meaning that residents pay an upfront entry fee and then have ongoing monthly charges. The average entrance fee is around $400,000, with monthly fees averaging $4,200.
In this section, we’ll go over why some people consider a CCRC.
Many seniors and their families value the peace of mind a CCRC provides. They know they won’t have to move, even if they need more care. This avoids multiple moves and helps maintain connections and familiarity. CCRCs also help couples with different needs stay together.
When CCRC contracts cover healthcare service costs, they protect against rising expenses. Because Type A contracts include all services, they can make budgeting easier, as healthcare costs are predictable. This can help protect assets, as it can prevent seniors from depleting their savings to pay for long-term care.
CCRCs may also factor into estate planning. Some CCRCs offer partially refundable entrance fees, which can be passed on to beneficiaries. Equity CCRCs also mean that the unit or ownership shares may be transferred to heirs.
Many seniors enjoy CCRCs because they offer amenities and services. These may include:
Dining options and meal plans
Housekeeping and maintenance
Transportation services
Fitness centers and wellness programs
Social activities and clubs
Research generally shows that seniors living in CCRCs have lower levels of loneliness and anxiety. CCRCs have a built-in social network, which can help reduce feelings of isolation and keep seniors involved and active. Educational programs and lectures also offer an engaging lifestyle.
In this section, we’ll go over potential drawbacks to consider.
CCRCs often have high entrance fees, which can be a barrier to entry for many seniors. In some cases, seniors might need to sell their assets to pay CCRC fees. This means they lose out on the benefits of having those funds invested. Middle-income seniors often fall into a gap where CCRC costs are too high, but they don’t qualify for low-income senior housing.
CCRCs also mean a long-term financial commitment. If seniors aren’t enjoying the community or need to leave, they may find it difficult to exit contracts, and they may lose their entrance fee investments. Some contracts may lead to higher monthly fees over time. This can affect how you plan your finances.
Joining a CCRC also comes with community financial stability risks. If the CCRC follows a for-profit model, there is a risk that it can be sold at any time, which can change or void contracts. However, CCRCs that follow a non-profit model may go bankrupt, which can impact costs and services.
CCRCs usually require you to be at least 62 years old. They also need health assessments and screenings. Usually, seniors need to be in good health to be accepted. Most CCRCs set financial standards. They check a senior’s income and assets to ensure they can afford the contract costs.
CCRCs provide less autonomy than home ownership. Seniors might need time to adapt to a new lifestyle. This includes adjusting to different rules, like pet and visitor policies. Seniors also need to follow any contractual obligations, such as restrictions on extended absences.
Choosing a CCRC is a personal choice. When looking for the best continuing care community for you or a loved one, you’ll want to consider:
Budget: Take time to understand contracts and all costs. Comparing these to current budgets can help you understand what is affordable for you or your loved ones.
Location: Many seniors prefer to be close to friends and family members. You’ll also want to consider the climate and proximity to amenities, such as shopping and entertainment.
Healthcare: Ask about the services provided, including how often doctors visit and any therapies available. You’ll also want to understand what happens during an emergency.
Amenities: Consider that the amenities suit your interests, including social activities, fitness centers and classes, and transportation.
Dining: Ask what the meal plan includes and what options are available.
Community: It can be helpful to talk to residents and tour the campus to get an understanding of how the community feels. You’ll also want to ask about policies for pets and visitors.
Alternatives to CCRCs include:
Assisted living: Assists with the activities of daily life and has a community feel, but does not provide constant specialized nursing care.
In-home care: Provides assistance with activities of daily living and medical care while the senior remains in their own home.
Adult day care: Offers supervised care and social activities to seniors during the day.
Respite care: Gives primary caregivers a break, which can help prevent burnout.
Adult foster care: Homes with a small number of older adults, with caregivers providing 24/7 care.
Active adult communities: Seniors have access to on-site amenities and community, but are responsible for their own homes and care.
CCRCs can provide stability for many seniors, allowing them to age in the same community, even when they start to need more care. However, CCRCs can be expensive and are a long-term financial commitment. When considering a CCRC, it’s important to understand contracts and community rules while assessing amenities and community feel to determine if it’s a good fit. CCRCs offer tours, and many offer overnight stays to help you determine if it’s a good fit.
Medicare does not cover the general costs of continuing care retirement communities. However, Medicare might cover some medical services at the CCRC, such as specialized nursing care and rehabilitation.
Life care contracts have higher upfront costs and cover the full scope of healthcare services. Modified contracts offer limited healthcare services. In contrast, fee-for-service contracts require residents to pay for services as they use them.
Checking financial statements and valuations with an accountant or tax expert can show if a CCRC is financially stable. Reviewing occupancy rates and talking to current residents can also be helpful.
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