CCRC downpayments - how to handle?

[youbet]

Youbet, you are correct that item 3 in my OP is probably the only one that is completely unique to a Life Care (Type A) property. In the facility we are moving to, full Asst Living is done in a dedicated wing. Most of the Type A properties seem to provide help in your unit if the aid is short term or doesn't require higher levels of skill from staff. If the assistance required is going be ongoing and especially if the assistance is for multiple needs, then you will be moved to Asst Living. What we like is that with the type As we seen, both spouses do not have to move if only one has the need. The only increase in cost is for the extra meals required in Asst Living. If you are in a Type B or C, you are faced with a big jump in costs and complexity when your cognitive horsepower may no longer be sufficiently robust to deal with the challenges esp if the spouse has serious medical complications.

Also agree +1000 times that the CCRC choice requires a fair amount of effort to unearth and understand the details before deciding. The book Holistic Living in Life Plan Communities I found very helpful in flushing out the multitude of issues you will want to vet. (got in paperback from Amz).
If you do decide a CCRC is part of your plans, I would recommend you make the refundable deposit to get on the waitlist (the ones we saw only required a $1000). The properties we saw would allow you to pass on open units until you are ready.

Thanks. I'll be ordering the book and appreciate the tip on that.

We've toured one particular Life Care (Contract A community) several times and like it. But these questions keep popping into my head and I can't seem to get answers that put me at ease.......

1. The buy-in fee and monthly fee schedules seem to be structured so that higher tier clients are subsidizing lower tier clients. That is, the difference in fees seems excessive for the difference in accommodations. For example, they're asking about 60% more to live in an upper floor unit with a balcony, nice view and about 300 more square feet than a lower floor unit without balcony, limited view and 300 square feet smaller. Since all out-of-unit amenities are shared (dining rooms, indoor and outdoor common areas, etc.), this seems excessive and not a very good value for the higher tier client.

2. They don't have a separate section of assisted living units. Assistance is provided in your independent living unit if required (at some extra cost to you depending on what you want and need) until and if you need to move to the full nursing unit (which has an excellent rating). We're having difficulty determining exactly what assistance they'd provide gratis and which would result in an extra charge. I get it that that assistance levels might vary greatly from person to person with some folks perhaps wanting an unreasonable amount or frequently calling for frivolous reasons. And obviously someone requiring some assistance but with a healthy spouse living with them would require less outside help stopping by. Still, it seems a bit open ended to me.

3. There seems to be a sweet spot health and age-wise for applying and moving in. We feel too young for a CCRC today (on tours everyone seemed 5 - 10 years or more older). Yet we understand that once certain health or aging problems begin, you're not going to qualify for a Type A contract.

4. We're a bit concerned about location flexibility. If our son, DIL and the grandkids moved and we were still healthy, we'd want to follow them (which they would welcome). Not sure we can arrange a buy-in package where we could do that and receive enough of a refund that the financial beating wouldn't be too painful.

All in all, we like the CCRC concept. The cost predictability of a Type A contract is appealing. But we can self-insure for LTC, so it isn't a must.

It's really confusing. We found out that one place that we weren't too keen on wasn't even taking waiting list applicants (requiring the $1k deposit) because they already had more folks on the list than they'd be able to accommodate for years. So...... we're not too keen on the place yet it's wildly popular. Go figure!

Edit: Just back from Amazon. Ordered the book you suggested and also Find the Right CCRC for Yourself or a Loved One

OP - sorry for the hijack.......

 

[nwsteve]

Thanks. I'll be ordering the book and appreciate the tip on that.

We've toured one particular Life Care (Contract A community) several times and like it. But these questions keep popping into my head and I can't seem to get answers that put me at ease.......

1. The buy-in fee and monthly fee schedules seem to be structured so that higher tier clients are subsidizing lower tier clients. That is, the difference in fees seems excessive for the difference in accommodations. For example, they're asking about 60% more to live in an upper floor unit with a balcony, nice view and about 300 more square feet than a lower floor unit without balcony, limited view and 300 square feet smaller. Since all out-of-unit amenities are shared (dining rooms, indoor and outdoor common areas, etc.), this seems excessive and not a very good value for the higher tier client.

2. They don't have a separate section of assisted living units. Assistance is provided in your independent living unit if required (at some extra cost to you depending on what you want and need) until and if you need to move to the full nursing unit (which has an excellent rating). We're having difficulty determining exactly what assistance they'd provide gratis and which would result in an extra charge. I get it that that assistance levels might vary greatly from person to person with some folks perhaps wanting an unreasonable amount or frequently calling for frivolous reasons. And obviously someone requiring some assistance but with a healthy spouse living with them would require less outside help stopping by. Still, it seems a bit open ended to me.

3. There seems to be a sweet spot health and age-wise for applying and moving in. We feel too young for a CCRC today (on tours everyone seemed 5 - 10 years or more older). Yet we understand that once certain health or aging problems begin, you're not going to qualify for a Type A contract.

4. We're a bit concerned about location flexibility. If our son, DIL and the grandkids moved and we were still healthy, we'd want to follow them (which they would welcome). Not sure we can arrange a buy-in package where we could do that and receive enough of a refund that the financial beating wouldn't be too painful.

All in all, we like the CCRC concept. The cost predictability of a Type A contract is appealing. But we can self-insure for LTC, so it isn't a must.

It's really confusing. We found out that one place that we weren't too keen on wasn't even taking waiting list applicants (requiring the $1k deposit) because they already had more folks on the list than they'd be able to accommodate for years. So...... we're not too keen on the place yet it's wildly popular. Go figure!

Edit: Just back from Amazon. Ordered the book you suggested and also Find the Right CCRC for Yourself or a Loved One

OP - sorry for the hijack.......

A couple of observations:
As you have already discovered there is no single model. Almost every CCRC has its own idiosyncrasies. Our target property has no meal plan so everything in the restaurant is ala cart albeit at very reasonable prices. The sister property monthly fee includes a $600/mon food allowance. When trying the restaurant, we saw a lot of folks taking food back to their unit--some because portions were large but we suspect they were also trying to "burn" their meal allowance. We like that there is no mandatory meal plan.

As far as age to enter--very individual decision. One resident pointed out that early entry gives you the advantage of a longer amortization time of the entry fee as well as allowing you to get the benefits of the CCRC for a longer time period. We will be 71 when we enter--4 years earlier than our target but given property appreciation in the area, ideal location to reach our DD and GK and elderly (94) parent and new build promos for filling, it is right for us.

In terms of wait list deposits. One other option is if you fine THE place and they don't have a wait list consider making a full deposit (typically 10%). The actual deposit usually puts you at the top of the list for open units just behind current residents. The deposit says we are committed and you usually get to participate in many of the CCRC programs and use some facilities like gym, etc. (Obviously, you need verification of the specifics)

Given the incredible variations in CCRC programs and pricing of services, going to a CCRC is not for the bashful. You really have to explicitly ask and more importantly inspect the actual docs you will be signing. It also helpful to talk with some of the longer term residents and ask what they seen happen regarding any area of concern. One of my favorite questions for a resident is "What one thing do you wish was different for residents" Answers can identify potential areas that may be of concern or just be a nit.

The CCRC we are going to provided very specific docs and language regarding how fees are set. For example in ours the monthly fee is driven by number of sq ft in unit and number of occupants. Ask to see the actual Resident agreement and Disclosures.

Research and detail probing are your best options for avoiding disappointment and unexpected costs. Be sure to talk with some of the resident leadership on the property's resident council. Find out what keeps them up at night and how they characterize the relationship with property management.
After all, you will be spending the rest of your life there, why wait to find out later on things critical to you.

 

[youbet]

Thanks nwsteve! Really appreciate your comments and advise.

When the two books we ordered arrive, we'll dive right in and, in combination with everything we're reading here, get more organized with our questions and research. No doubt, we've been too loosey-goosey in defining our objectives and structuring the process of educating ourselves. Likely, the tours and presentations we've attended so far have only touched the surface of what we need to know and understand.

 

[Spock]

We are the process of making the move to a Life Care (Type A) CCRC.....

Is this the same "Life Care" company?
Life Care Center of Tucson

We had my mom in the above facility for rehab after a stroke, directly across the street from the hospital, high ratings, etc. The place was absolutely terrible. Facility Dr was a quack that I had to print off medication web-info were the mfgr explicitly stated not to use their med (and their TV commercials say not to use their med (a blood thinner) on heart valve replacement patients. Facility was on constant c-diff "lock down" and there was plenty of evidence where they didn't clean up the floors from c-diff "incidents" etc.


Not trying to rain on your choice, just extremely interested in finding out if some of these wonderful CCRC facilities you all are describing are truly the promised land or if its like every other "the quality of care depends on who they hired last week".

 

[Spock]

When "investing" these large down payments/deposits at CCRC's, what are the protections that the company doesn't go bankrupt or other business fraud and poof the $ are gone?

 

[kimcdougc]

When "investing" these large down payments/deposits at CCRC's, what are the protections that the company doesn't go bankrupt or other business fraud and poof the $ are gone?

This would be my concern.

 

[nwsteve]

Is this the same "Life Care" company?
Life Care Center of Tucson

We had my mom in the above facility for rehab after a stroke, directly across the street from the hospital, high ratings, etc. The place was absolutely terrible. Facility Dr was a quack that I had to print off medication web-info were the mfgr explicitly stated not to use their med (and their TV commercials say not to use their med (a blood thinner) on heart valve replacement patients. Facility was on constant c-diff "lock down" and there was plenty of evidence where they didn't clean up the floors from c-diff "incidents" etc.


Not trying to rain on your choice, just extremely interested in finding out if some of these wonderful CCRC facilities you all are describing are truly the promised land or if its like every other "the quality of care depends on who they hired last week".

Fortunately NOT! We are moving to a property near Tacoma, WA--Gig Harbor--Heron's Key.

Edited to Add: I do think your observation is fair regarding staffing. Many years ago, I did executive search for the LTC industry--at that time the talent pool was pretty shallow. It took us a while to convince our client to start incorporating talent from the broader hospitality industry to bring some fresh blood into the industry.

 

[Sunset]

Fortunately NOT! We are moving to a property near Tacoma, WA--Gig Harbor--Heron's Key.

Edited to Add: I do think your observation is fair regarding staffing. Many years ago, I did executive search for the LTC industry--at that time the talent pool was pretty shallow. It took us a while to convince our client to start incorporating talent from the broader hospitality industry to bring some fresh blood into the industry.

Thanks for providing this concrete example.
It looks rather nice.
Their videos were carefully scripted, as would be expected. I'm sure the kitchen is a lot more hectic during a real meal time than what is shown.

 

[bada bing]

Fortunately NOT! We are moving to a property near Tacoma, WA--Gig Harbor--Heron's Key.

Edited to Add: I do think your observation is fair regarding staffing. Many years ago, I did executive search for the LTC industry--at that time the talent pool was pretty shallow. It took us a while to convince our client to start incorporating talent from the broader hospitality industry to bring some fresh blood into the industry.

Welcome to Heron's Key !

I moved my mother (86) into Heron's Key a little over a year ago. I visit there
about once a month to check up on her. She is very happy with the choice so
far. Our family are long time Gig Harbor residents, I graduated from high
school there, although I moved away shortly after. Gig Harbor has changed
enormously in 40 years.

If there are any questions you have about Heron's Key from a somewhat
objective 3rd party (me), I know a little about how the contractual stuff
works. After seeing the place, I have it (or a similar place) as a potential
option for myself when the time comes .

Perhaps you'll run into me sometime in Spinnakers or Siren's grill while I'm
visiting my mom. I'm a tall 6'4" ~60y.o., blond haired, blue collar looking sort
of fellow. If you see me around, say hi.

 

[PawPrint53]

What we like is that with the type As we seen, both spouses do not have to move if only one has the need.

Friends moved into a CCC where they rented a house, but could then go into an apartment or assisted living as needed as is typical. However, included in the fine print was that if a person had two falls where assistance was needed, then that person had to go to assisted living while the other person stayed in the house. It was incredibly expensive maintaining the CCC home and having one person in assisted living. My friends moved because that wasn't something they could afford, especially since the husband had the onset of a dementia, and they knew that memory care would be needed in the future.

 

[nwsteve]

Friends moved into a CCC where they rented a house, but could then go into an apartment or assisted living as needed as is typical. However, included in the fine print was that if a person had two falls where assistance was needed, then that person had to go to assisted living while the other person stayed in the house. It was incredibly expensive maintaining the CCC home and having one person in assisted living. My friends moved because that wasn't something they could afford, especially since the husband had the onset of a dementia, and they knew that memory care would be needed in the future.

This issue is one example where detail attention to a CCRC's docs is critical--not all CCRCs handle this event the same way. The CCRC we are headed for does not require you to pay for the additional space beyond the actual meals which is required by state to be served in Assisted/skilled nursing units. Suspect the property is not a Life Care (Type A) CCRC.

 

[youbet]

Friends moved into a CCC where they rented a house, but could then go into an apartment or assisted living as needed as is typical. However, included in the fine print was that if a person had two falls where assistance was needed, then that person had to go to assisted living while the other person stayed in the house. It was incredibly expensive maintaining the CCC home and having one person in assisted living. My friends moved because that wasn't something they could afford, especially since the husband had the onset of a dementia, and they knew that memory care would be needed in the future.

As nwsteve said, it sounds as though the property your friends were living at was not a LifeCare facility. With a type A, LifeCare contract, the person needing full residential assistance would have moved to assisted living and the spouse would have stayed in the independent living home with the only increase in cost being for additional meals for the assisted living person.

It's complicated. Don't assume one CCRC is operating the same as another. Each type, A, B or C, has it's pros and cons. And there are differences within types. As mentioned earlier, DW and I are a bit dizzy from trying to understand all the ins and outs. We just had a couple of books delivered yesterday and are taking a brief time-out to read them before jumping into the frey again.

 

[Gearhead Jim]

A side note on a CCRC-


We went to the sales pitch at a big, fancy, and long time CCRC. We didn't want to move there but wanted the education from watching the spiel. The entrance costs were shockingly high when coupled with the monthly fee, but of course you are somewhat pre-paying for your future, so we thought.


Since we both have LTC insurance for 5 years with a high monthly payout, inflation adjusted, we figured that would get us a sizeable reduction in the costs at the CCRC if we assigned the insurance to them. The reduction they would provide was minimal, making the whole package a very poor deal.

 

[harllee]

The CCRC where we are on the waiting list (Type A Life Care) actively discourages those with long term care insurance from moving in (which suits us just fine since we do not have LTCI). The folks at the CCRC say that LTCi, all the red tape and the difficulty collecting is more trouble than it is worth in their opinion.

 

[ChrisC]

Another side note on a CCRC.

The CCRC we've been carefully reviewing would work exceptionally well with my LTCi, which covers 5 years with a 90 day waiting period. It also has equity ownership. https://www.thecypressofcharlotte.com/

 

[someday soon]

First post ever, y'all ...thanks for the informative discussion![/br]

I noticed the author of the Holistic Living in Life Plan Communities book noted above in this thread has a companion website. There's inevitable book promo, but also additional info that looks helpful -- interactive map of facilities, links to further resources, news about CCRC communities, etc.
Home | Aging Holistically in Life Plan Communities

 

[badatmath]

I thought by now having $100,000 in an HSA would not be unusual.

I don't believe I know anyone with an HSA IRL due to the fact most of my friends work for employers who do not offer HD plans.

 

[mickeyd]

OP referred to the size of the "downpayment" however I believe the correct term is entrance fee.


We are considering CCRC in the future and plan on paying for the entrance fee out of accumulated cash that is sitting in our PMMF at this time. After moving from our current home to the CCRC, we will then sell our home and deposit the funds from the sale back into the PMMF.


Monthly CCRC fees will be paid from PMMF via checkbook provided by the fund.


Seems like a plan.

 

[Sunset]

What is PMMF ?

 

[mickeyd]

When "investing" these large down payments/deposits at CCRC's, what are the protections that the company doesn't go bankrupt or other business fraud and poof the $ are gone?

Inquire as to what their bond rating is.

 

[mickeyd]

What is PMMF ?

Sorry, Prime Money Market Fund. It's a Vanguard fund.

 

[Spock]

Inquire as to what their bond rating is.

The same bond raters that called sub-prime mortgages "investment grade"? Watch the congressional testimony of the bond raters (Moody's, S&P, Fitch) after the MBS collapse. "Our ratings are just opinions and therefore covered by free speech, we can not be held accountable for an opinion".

 

[ChrisC]

Inquire as to what their bond rating is.

I wouldn't rely solely on any bond rating, assuming the company is publically traded. I think you have to do a real deep dive on the company or entities financials; assess current or projected occupancy levels (been told that anything below 90 percent occupancy is not good); review future plans for campus expansion if any; whether it's a non-profit or for profit entity, the class of residents currently occupying the place (having upper middle class or affluent residents that could backstop others and fund charitable endowments would be a plus); and important to us, is whether there are any restrictions on placement into the skilled nusrsing facility, including how many beds are available -- some places say they have 100 beds available, but what happens if those beds are taken (e.g. they have 75 "permanent" residents there and the other 25 are people in rehab on a temporary basis -- if you need skilled nursing care in the facility -- do they farm you out and keep you there indefinitely?

 

[mickeyd]

I wouldn't rely solely on any bond rating, assuming the company is publically traded. I think you have to do a real deep dive on the company or entities financials; assess current or projected occupancy levels (been told that anything below 90 percent occupancy is not good); review future plans for campus expansion if any; whether it's a non-profit or for profit entity, the class of residents currently occupying the place (having upper middle class or affluent residents that could backstop others and fund charitable endowments would be a plus); and important to us, is whether there are any restrictions on placement into the skilled nusrsing facility, including how many beds are available -- some places say they have 100 beds available, but what happens if those beds are taken (e.g. they have 75 "permanent" residents there and the other 25 are people in rehab on a temporary basis -- if you need skilled nursing care in the facility -- do they farm you out and keep you there indefinitely?

Boo-ya to both Spock and ChrisC for posting a much more complete response than I did.

 

[Huston55]

Here’s more good CCRC reference material from the E-R.org FAQs, including how to evaluate prospective CCRCs.

http://www.early-retirement.org/forums/f47/ccrc-reference-material-faqs-86124.html