Are CCRC’s For You? Here Are Some Things to Consider

Chris and Lizzie on the staff tour of Westminster Canterbury

Chris and Lizzie on the staff tour of Westminster Canterbury

Recently, Common Sense for Seniors staff were in Richmond, VA., home of their younger daughter and her husband, and took the opportunity to visit Westminster Canterbury, a continuing care retirement community. It’s a lovely place, with all the conveniences and amenities one could wish. The grounds are beautifully maintained. There’s a putting green, an aquatic center, a gym, numerous dining options (cocktails and wine are served,) a library, a woodworking shop, and even a model train room. A first-class auditorium features regular performances by top-notch acts. There are even kids around, thanks to an onsite child development center.

We weren’t able to view an apartment, since it was a Saturday and regular sales staff were off, but we have no doubt they are lovely too. You can see some floor plans at the website. Note that they include kitchens — signing up for a meal plan is optional. Many residents continue to shop and cook as always.  Guests are welcome, as are pets.

Westminster Canterbury, which also has campuses on the Chesapeake and elsewhere, is what’s known as a life care or extended contract community.

Spend a little time with Google, and you can find such life care communities all around the country. Most are run by non-profits, often created by religious organizations, but some are owned by corporations.  Vi Palo Alto, one of the fanciest, is owned by “Pritzker family business interests,” according to Wikipedia.

In order to start living in a CCRC, you must pay a one-time entrance fee — usually in the low to mid six figures, though charges in excess of $1 million can be found at places like Vi Palo Alto. In addition, there is a monthly fee, typically ranging from $4,000 to $6,000, varying according to the type of apartment or small house (typically called a “villa”) you choose. In exchange, residents are guaranteed lifetime care, including memory care for those who suffer from Alzheimer’s disease, care in an assisted living facility, and skilled nursing care — never paying more than their basic monthly fee.

Residents are expected to be healthy when they start out at a life care facility, moving into an “independent living” apartment or villa. Typically, new residents keep their cars and live as they always have — except that they are in a very convenient place, with lots going on and no worries about home maintenance or the lawn and garden. They might continue in independent living indefinitely, but if the need arises, they can move to what the industry calls a “higher level of care.”

The entry fee, however, is a lot. It could take a substantial portion of someone’s savings or most of the proceeds that come from selling a house. On the other hand, that lifetime care promise is significant. In a CCRC, you need never be a burden to the children. If your spouse becomes ill and has to go to that higher level of care, he or she will be nearby and easy to visit. You might shift to a meal plan at that point, so you won’t have the bother of cooking for one. Should you become ill yourself, you won’t have to fret over finding an assisted living facility or a nursing home — that choice will already have been made.

Still, the fee could be a problem. Many seniors simply don’t have that amount of money on hand. They might want to look for a HUD-backed facility like St. Mark’s Terrace. Other seniors want to keep their nest egg intact, as far as possible, so that they can  pass it on to their children. Most CCRCs will refund a portion of the fee to you if you leave shortly after arriving, or to your estate should you die; but the amount refunded drops over a fixed time until reaching zero. Some CCRCs have come up with alternative payment schemes to protect estates — promising to repay 70 per cent, for example, for those who make larger entry payments than the base at the outset. Some offer modified care plans to lower the entry fee. If you already have long-term care insurance or the resources to self-finance skilled nursing care, you might get a break on the fee.

These options can be quite confusing, and you should certainly consult an elder law attorney and your financial advisor before signing any contract. One concern is that any refundable portion of your entrance fee likely isn’t being held in reserve but instead is being used for operating expenses. If the CCRC goes bankrupt, you’re  unlikely to get it back — though so far, bankruptcies have been rare. Monthly fees can be subject to increases; and you might not necessarily be guaranteed a spot in assisted living or skilled nursing if all the beds are filled.

Be sure to read what the Elder Law website and AARP have to say about CCRCs before moving forward. Meanwhile, here are some illustrative CCRC websites.

Woodlands in West Virginia is among those stating that residents can take the entrance fee as a one-time medical deduction.

ACTS Retirement Life Communities seem attractive.

Vi Bentley Village in Naples, Florida, puts its fees online, which is fairly unusual.

Trilogy says its communities make you feel like you’re on vacation.

Vi Living in Scottsdale says being there is like being on a cruise.

Briarcliff Manor, in Westchester County, has a minimum entrance fee of $419,000, which doesn’t include life care. If you need assisted living or skilled nursing care, you’ll pay at the market rate.

Goodwin House in Alexandria, Virginia, has some interesting contract options.



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