Continuing Care Retirement Community Entrance Fee

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Prudence
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Continuing Care Retirement Community Entrance Fee

Post by Prudence »

DW and I are considering a move to a CCRC. This CCRC has two entrance fee options for the specific villa we are interested in: 90% refundable entrance fee or non-refundable entrance fee. I compared the present value of the cost of these two options and determined that the refundable fee would be more favorable to us. The 90% refundable fee is $1,011,200 and the non-refundable fee is $577,800. Based on my DW's life expectancy of 17.3 years, I assumed the fee would be refunded in 18 years, and assumed an average rate of inflation of 2.5%, compounded monthly. The calculation is as follows:
-$1,011,200 (fee paid now)+$580,564 (PV of $910,080 refund received in 18 years)=-$430,636 (net present value or cost in today's dollars).
So, the cost in today's dollars of the refundable fee is $147,164 less than the non-refundable fee of $577,800. Additionally, the point of indifference would be an average inflation rate of 4.12% which is unrealistically high, even with the growing national debt. Although the refundable fee has a lower cost to us, I am thinking that it may not be wise to tie up the extra $433,400 (the difference between the non-refundable and refundable fees) for 18 years. Please feel free to provide critique or comments.
bberris
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Re: Continuing Care Retirement Community Entrance Fee

Post by bberris »

Consider an alternative plan: Isn't that enough money to hire in-house care when it becomes necessary and stay where you are? I'm assuming you don't need additional care help yet or is there some current disability? I presume there is also a continuing cost to the RC in addition to the fee. How is the refundable payment secured? Do you have a claim on the property if it goes bust?
sailaway
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Re: Continuing Care Retirement Community Entrance Fee

Post by sailaway »

What would you do with the difference if you paid the lower fee? Wouldn't that be invested and thus contribute to portfolio growth during that time?
smitcat
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Re: Continuing Care Retirement Community Entrance Fee

Post by smitcat »

Prudence wrote: Mon Aug 31, 2020 8:35 am DW and I are considering a move to a CCRC. This CCRC has two entrance fee options for the specific villa we are interested in: 90% refundable entrance fee or non-refundable entrance fee. I compared the present value of the cost of these two options and determined that the refundable fee would be more favorable to us. The 90% refundable fee is $1,011,200 and the non-refundable fee is $577,800. Based on my DW's life expectancy of 17.3 years, I assumed the fee would be refunded in 18 years, and assumed an average rate of inflation of 2.5%, compounded monthly. The calculation is as follows:
-$1,011,200 (fee paid now)+$580,564 (PV of $910,080 refund received in 18 years)=-$430,636 (net present value or cost in today's dollars).
So, the cost in today's dollars of the refundable fee is $147,164 less than the non-refundable fee of $577,800. Additionally, the point of indifference would be an average inflation rate of 4.12% which is unrealistically high, even with the growing national debt. Although the refundable fee has a lower cost to us, I am thinking that it may not be wise to tie up the extra $433,400 (the difference between the non-refundable and refundable fees) for 18 years. Please feel free to provide critique or comments.
Are you completely comfortable with the CCRC's future abililty to continue offering a high quality service while remaining solvent?
wanderer
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Re: Continuing Care Retirement Community Entrance Fee

Post by wanderer »

Did you account for the lost investment opportunity between the two options?
Say 2% over inflation: $1,011,200 - $577,800 = $433,400 left to invest for 18 years. $433,400 (1.02)^18 - $619,00. A gain of $185,602.

18 years is a long time to tie up $433K. And what guarantees do you have regarding the quality of service or the default risk of the business. The nursing home my dad was in and the CCF facility my mom was in both changed owners and service contractors at least 2 times during the 2-3 years they each lived in the facilities. Note: in both cases, the owners of the business contracted out the management and nursing staff so they were separate contracts. It seemed like constant turnover. I'd rate the default risk somewhere around BBB- or worse

And how confident in the assumptions are you for life span and inflation, investment returns, etc. Seems like significant potential variance. I take the recent fed actions to suggest they expect low inflation for the near future, whereas Warren Buffett is buying energy and commodity trading companies. That, to me implies he sees these sectors as recovering or an inflation hedge.

Bottom line, you might also run the options for hiring in-home care as suggested by the first poster.
littlebird
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Re: Continuing Care Retirement Community Entrance Fee

Post by littlebird »

bberris wrote: Mon Aug 31, 2020 9:16 am Consider an alternative plan: Isn't that enough money to hire in-house care when it becomes necessary and stay where you are? I'm assuming you don't need additional care help yet or is there some current disability? I presume there is also a continuing cost to the RC in addition to the fee. How is the refundable payment secured? Do you have a claim on the property if it goes bust?
In home care requires someone with a fair degree of cognitive ability to supervise, plan and regulate the caregivers. In home care does not offer much social enrichment. In home care does not provide high quality meals. In home care does not relieve elders of the burden of home maintenance, transportation and most bill-paying. In home care has its place — I recently cared for and supervised the health aides who cared for a much older spouse in the last stages of Parkinson’s Disease — but it ‘s not remotely similar to living in a CCRC.
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willthrill81
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Re: Continuing Care Retirement Community Entrance Fee

Post by willthrill81 »

smitcat wrote: Mon Aug 31, 2020 9:40 am
Prudence wrote: Mon Aug 31, 2020 8:35 am DW and I are considering a move to a CCRC. This CCRC has two entrance fee options for the specific villa we are interested in: 90% refundable entrance fee or non-refundable entrance fee. I compared the present value of the cost of these two options and determined that the refundable fee would be more favorable to us. The 90% refundable fee is $1,011,200 and the non-refundable fee is $577,800. Based on my DW's life expectancy of 17.3 years, I assumed the fee would be refunded in 18 years, and assumed an average rate of inflation of 2.5%, compounded monthly. The calculation is as follows:
-$1,011,200 (fee paid now)+$580,564 (PV of $910,080 refund received in 18 years)=-$430,636 (net present value or cost in today's dollars).
So, the cost in today's dollars of the refundable fee is $147,164 less than the non-refundable fee of $577,800. Additionally, the point of indifference would be an average inflation rate of 4.12% which is unrealistically high, even with the growing national debt. Although the refundable fee has a lower cost to us, I am thinking that it may not be wise to tie up the extra $433,400 (the difference between the non-refundable and refundable fees) for 18 years. Please feel free to provide critique or comments.
Are you completely comfortable with the CCRC's future abililty to continue offering a high quality service while remaining solvent?
That's the key question when paying any entrance fee, refundable or otherwise, to a CCRC. If it becomes insolvent, even a supposedly refundable entrance fee may be lost in part or whole.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
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willthrill81
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Re: Continuing Care Retirement Community Entrance Fee

Post by willthrill81 »

littlebird wrote: Mon Aug 31, 2020 10:36 am
bberris wrote: Mon Aug 31, 2020 9:16 am Consider an alternative plan: Isn't that enough money to hire in-house care when it becomes necessary and stay where you are? I'm assuming you don't need additional care help yet or is there some current disability? I presume there is also a continuing cost to the RC in addition to the fee. How is the refundable payment secured? Do you have a claim on the property if it goes bust?
In home care requires someone with a fair degree of cognitive ability to supervise, plan and regulate the caregivers. In home care does not offer much social enrichment. In home care does not provide high quality meals. In home care does not relieve elders of the burden of home maintenance, transportation and most bill-paying. In home care has its place — I recently cared for and supervised the health aides who cared for a much older spouse in the last stages of Parkinson’s Disease — but it ‘s not remotely similar to living in a CCRC.
+1

Also, many who go into CCRCs are fully capable of independent living, at least at first. They often don't need any in-home care at all. Rather, they want to age in place, build relationships, and enjoy what is often a rather pleasant environment.

About a year ago, we visited a local independent living facility (not a CCRC) and were shocked at how nice everything was. When we arrived, there were a lot of residents with their family and friends having drinks at a bar and singing karaoke. It felt very much like a cruise ship. Rooms were cleaned weekly, local transportation was provided, etc. I can entirely see the appeal of staying in such a place even if one was capable of caring for oneself in a single family home. And with a CCRC, when you need greater care, you can receive it there.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
Alan S.
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Re: Continuing Care Retirement Community Entrance Fee

Post by Alan S. »

While safety of these huge entry fees has long been an area of concern, pandemics are capable of exposing vulnerabilities to the financing model.

The best way to guarantee against forfeiture of several hundred thousand dollars is to require the facility to provide a performance bond guaranteeing return of your money in the event of facility bankruptcy. I don't know if such institutions are willing to do that, but the CCRC model must be under considerable stress right now due to Covid.
smitcat
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Re: Continuing Care Retirement Community Entrance Fee

Post by smitcat »

willthrill81 wrote: Mon Aug 31, 2020 10:56 am
littlebird wrote: Mon Aug 31, 2020 10:36 am
bberris wrote: Mon Aug 31, 2020 9:16 am Consider an alternative plan: Isn't that enough money to hire in-house care when it becomes necessary and stay where you are? I'm assuming you don't need additional care help yet or is there some current disability? I presume there is also a continuing cost to the RC in addition to the fee. How is the refundable payment secured? Do you have a claim on the property if it goes bust?
In home care requires someone with a fair degree of cognitive ability to supervise, plan and regulate the caregivers. In home care does not offer much social enrichment. In home care does not provide high quality meals. In home care does not relieve elders of the burden of home maintenance, transportation and most bill-paying. In home care has its place — I recently cared for and supervised the health aides who cared for a much older spouse in the last stages of Parkinson’s Disease — but it ‘s not remotely similar to living in a CCRC.
+1

Also, many who go into CCRCs are fully capable of independent living, at least at first. They often don't need any in-home care at all. Rather, they want to age in place, build relationships, and enjoy what is often a rather pleasant environment.

About a year ago, we visited a local independent living facility (not a CCRC) and were shocked at how nice everything was. When we arrived, there were a lot of residents with their family and friends having drinks at a bar and singing karaoke. It felt very much like a cruise ship. Rooms were cleaned weekly, local transportation was provided, etc. I can entirely see the appeal of staying in such a place even if one was capable of caring for oneself in a single family home. And with a CCRC, when you need greater care, you can receive it there.
"It felt very much like a cruise ship."
Interesting anology as we have seen a large problem with Covid19 here at a CCRC, rehabs, and nursing homes.
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willthrill81
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Re: Continuing Care Retirement Community Entrance Fee

Post by willthrill81 »

smitcat wrote: Mon Aug 31, 2020 11:16 am
willthrill81 wrote: Mon Aug 31, 2020 10:56 am About a year ago, we visited a local independent living facility (not a CCRC) and were shocked at how nice everything was. When we arrived, there were a lot of residents with their family and friends having drinks at a bar and singing karaoke. It felt very much like a cruise ship. Rooms were cleaned weekly, local transportation was provided, etc. I can entirely see the appeal of staying in such a place even if one was capable of caring for oneself in a single family home. And with a CCRC, when you need greater care, you can receive it there.
"It felt very much like a cruise ship."
Interesting anology as we have seen a large problem with Covid19 here at a CCRC, rehabs, and nursing homes.
My analogy was actually more astute than I was aware of! :D

Our visit was well before COVID19, so it may be very different now. It has certainly shown that many elderly people living in very close proximity to each other carries its own risks.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
NotWhoYouThink
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Re: Continuing Care Retirement Community Entrance Fee

Post by NotWhoYouThink »

Covid may have helped CCRC finances, by freeing up space for new residents. I haven't seen any overall analysis, but their incentive is always to bring in new residents and their up-front payments.

Let's hope there is not another pandemic, but the downside of CCRC living right now is that residents in most are isolated from their families. My mother died in the rehab wing of her CCRC last month. The only time she saw her family the last 4 months of her life was when she was in the hospital for a few days, because the hospital had less restrictive rules for visitors. The decline in her health was directly related to the isolation, she had been in independent living about to move into Assisted Living when the lock-down started.

We noticed that they seemed exceptionally eager to move her into Assisted Living, and realized that if they move someone there it frees up an apartment in Independent Living that they can charge the entry fee for.
fourwheelcycle
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Re: Continuing Care Retirement Community Entrance Fee

Post by fourwheelcycle »

My wife and I are most likely headed for a local CCRC where we are already at the top of the waiting list. CCRC's in general are a very small niche market, selected by less than 1% of all seniors. Being able to afford a CCRC is a big selection factor, and wanting to live at a CCRC rather than moving to a non-CCRC retirement community, or aging in place and relying on in-home care, if needed, is another selection factor.

Most people, including us, choose to move to CCRCs because they have visited the particular CCRC they are considering and find it comes very close to the lifestyle and the types of friends they are used to in their current life - and - they either have no children or do not want to impose any burden on their own children to arrange and supervise their care when they become older.

My wife and her sister arranged 24/7 in-home care for their parents for the last several years of their lives. They both lived 400 to 500 miles away, doing a lot by phone and also visiting three or four times per year. My mother died many years ago, but my sister and I are completely responsible for my 98 year old father's care and finances in an assisted living facility near where I grew up, but 1,000 miles from where I live now.

Refundable and non-refundable entrance fee models are common for CCRC's. OP has done their math and will make a choice with their eyes open. I hope they enjoy their CCRC and live long, staying healthy until the end.
RudyS
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Re: Continuing Care Retirement Community Entrance Fee

Post by RudyS »

What if, heaven forbid, you don't make it till DW is 17? Say you both go under the bus in few years? The kids (if any) get nothing under the nonrefundable option.
ralph124cf
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Re: Continuing Care Retirement Community Entrance Fee

Post by ralph124cf »

We have visited some local CCRCs, and they have a lot of different plans. In two of the CCRCs, the monthly fees went up if you paid less up front. In two others the monthly fee stayed the same.

Ralph
crefwatch
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Re: Continuing Care Retirement Community Entrance Fee

Post by crefwatch »

I believe that most CCRCs require that new residents must be Independent Living when they arrive. Obviously, if a facility "starts" with Assisted Living, that wouldn't be the case. But not all AL facilities include an onsite Skilled Nursing facility. I might add that there have been disturbing reports of bylaws that, nominally, prohibit an Independent spouse from bringing her Skilled Nursing partner's wheelchair to the Independent dining room. It's too much of a "memento mori" to the other Independent residents, apparently.

I don't tell that story to slam CCC's. Since we have no children, we are very likely to go directly from our work-life home to such a place. Besides making sure the facility (NFP or for-Profit) is financially stable, there are many other factors to consider. For example, it's been pointed out to us (metaphorically, I mean) that a 150-resident facility may have only 3 people show up for Bridge on any given day. In a 500-resident facility, that's much less likely.

Having had 24-7 home aides for my mother, I can testify that good aides can provide solace and socialization. But these people have families and lives, too. They get sick, take vacations, and ride the subway (NYC ... ) to and from work. (I'm referring to issues like Covid and bedbugs.) Our lawyer said, without any leeway and reservations, "DO NOT PAY PRIVATE AIDES UNDER THE TABLE. If the IRS catches you, your life is over." In addition, my mother's long term care insurance company would not write checks to an INDIVIDUAL, but only to an established agency. And that agency marked up the poor pay by 100%. Just one family's experience.
InMyDreams
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Re: Continuing Care Retirement Community Entrance Fee

Post by InMyDreams »

If it's been mentioned, I'm sorry -

The local CCRC here (and others that I've heard of) will return your 90% of the money only after they sell/rent your apartment/villa to someone else.

Check your state's laws regarding that money. I think I've been told that there is some sort of return plan written into my state's laws or regs.

Hmm. seems like there's a website about CCRCs, but I don't seem to have a bookmark.

This book was recommended (haven't read it, not ready to make this leap)
https://www.amazon.com/Ruth-Alvarez/e/B ... 643&sr=8-2
fourwheelcycle
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Re: Continuing Care Retirement Community Entrance Fee

Post by fourwheelcycle »

Alan S. wrote: Mon Aug 31, 2020 11:14 am While safety of these huge entry fees has long been an area of concern, pandemics are capable of exposing vulnerabilities to the financing model.

The best way to guarantee against forfeiture of several hundred thousand dollars is to require the facility to provide a performance bond guaranteeing return of your money in the event of facility bankruptcy. I don't know if such institutions are willing to do that, but the CCRC model must be under considerable stress right now due to Covid.
Alan is right. I doubt CCRC's would ever provide performance bonds to new entrants, but Covid is certainly going to test their finances. CCRC's live and die by the cash flow from their entrance fees and monthly residential unit fees. The former depends on new entrants and the latter depends on overall occupancy levels, both of which are carefully budgeted and counted upon.

Most CCRCs deposit new entrance fees in restricted funds and release them to their annual operating budgets on an amortization schedule based on residents' remaining actuarial lifetime. If people become concerned about their intended CCRC's finances due to Covid and cancel or delay moving in, the CCRC will face a gap in their budgeted operating income from amortized entrance fees. Amortized entrance fee income can amount to 40% or more of a CCRC's overall annual operating budget.

Also, every person or couple who cancel or delay their entry means one less occupied unit for the CCRC. Since each occupied unit may provide $60-$70K of annual income, the impact of an occupancy decline from just a few more unoccupied units can be dramatic. As entrance fee and occupancy income drop, facility maintenance, staffing, and meal quality, etc., must be reduced and/or entrance fees and monthly fees must go up to maintain operations. This can quickly lead to a death spiral of fewer new residents and even lower entrance fee and monthly fee income, leaving higher monthly fees from existing residents as the only budget-balancing alternative.

Our local CCRC has not had a single case of Covid (fingers crossed), but it has experienced a short term decline in new resident move-ins simply because people do not want to board a cruise ship during a pandemic. My wife and I are still four or more years from making a move, so we have time to watch and assess the finances of our local CCRC before we have to make a decision.
ScubaHogg
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Re: Continuing Care Retirement Community Entrance Fee

Post by ScubaHogg »

willthrill81 wrote: Mon Aug 31, 2020 11:20 am Our visit was well before COVID19, so it may be very different now. It has certainly shown that many elderly people living in very close proximity to each other carries its own risks.
Conversely, in many places, the only “company” many older citizens are getting these days are the co-residents of facilities like this, since for obvious reasons they have limited interaction with the public at large, so to speak.

Viewed in that light not living in close proximity with some other elderly people carries its own risks. Risks of social isolation in this case.
“Unexpected Returns dominate the Expected Returns” - Ken French
littlebird
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Re: Continuing Care Retirement Community Entrance Fee

Post by littlebird »

InMyDreams wrote: Mon Aug 31, 2020 3:10 pm If it's been mentioned, I'm sorry -

The local CCRC here (and others that I've heard of) will return your 90% of the money only after they sell/rent your apartment/villa to someone else.
And after they charge you for restoring to original configuration any remodeling you’ve done.
Old Sage(brush)
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Re: Continuing Care Retirement Community Entrance Fee

Post by Old Sage(brush) »

If you enter a CCRC under the 90% refundable model but with the refund condition being sale of the unit then in addition to the overall solvency risk there is market risk. If this particular facility has significant vacancies, or facilities in general are over capacity for the demand, or your particular unit sits vacant it can impact return of the refund and also might lead to an attempt to through negotiations refund less than the 90%.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

bberris wrote: Mon Aug 31, 2020 9:16 am Consider an alternative plan: Isn't that enough money to hire in-house care when it becomes necessary and stay where you are? I'm assuming you don't need additional care help yet or is there some current disability? I presume there is also a continuing cost to the RC in addition to the fee. How is the refundable payment secured? Do you have a claim on the property if it goes bust?
Yes, I would prefer aging in place because our house is in an excellent location (since 1980). The issue is to avoid becoming a burden to family in the future. Yes, there is a monthly fee which would increase our spending budget if we move to the CCRC. No claim. But, this CCRC (and another one that we are considering) are among the best in terms of their history of financial soundness and management.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

sailaway wrote: Mon Aug 31, 2020 9:23 am What would you do with the difference if you paid the lower fee? Wouldn't that be invested and thus contribute to portfolio growth during that time?
Yes, I thought about it and did those calculations too but decided that the NPV method I used was more relevant and meaningful for comparing the two options.
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Re: Continuing Care Retirement Community Entrance Fee

Post by stan1 »

Prudence, it seems you have been evaluating CCRC options for years now and you've posted that you can well afford it. You've stated that you and your wife would enjoy living at a carefully selected CCRC.

If I may ask, what is your criteria to end the evaluation and analysis phase and move forward with a decision?
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

smitcat wrote: Mon Aug 31, 2020 9:40 am
Prudence wrote: Mon Aug 31, 2020 8:35 am DW and I are considering a move to a CCRC. This CCRC has two entrance fee options for the specific villa we are interested in: 90% refundable entrance fee or non-refundable entrance fee. I compared the present value of the cost of these two options and determined that the refundable fee would be more favorable to us. The 90% refundable fee is $1,011,200 and the non-refundable fee is $577,800. Based on my DW's life expectancy of 17.3 years, I assumed the fee would be refunded in 18 years, and assumed an average rate of inflation of 2.5%, compounded monthly. The calculation is as follows:
-$1,011,200 (fee paid now)+$580,564 (PV of $910,080 refund received in 18 years)=-$430,636 (net present value or cost in today's dollars).
So, the cost in today's dollars of the refundable fee is $147,164 less than the non-refundable fee of $577,800. Additionally, the point of indifference would be an average inflation rate of 4.12% which is unrealistically high, even with the growing national debt. Although the refundable fee has a lower cost to us, I am thinking that it may not be wise to tie up the extra $433,400 (the difference between the non-refundable and refundable fees) for 18 years. Please feel free to provide critique or comments.
Are you completely comfortable with the CCRC's future abililty to continue offering a high quality service while remaining solvent?
I think their finances are in good shape and will remain so. But, I am concerned that if and when we need significant assisted living or comprehensive care, we will be at their mercy. My mother was in a nursing home for almost three years and during that time I sadly noticed that the residents were frequently isolated and ignored by the staff (8 to 1 ratio). So, this may cancel out the main benefit of the CCRC that they will always take care of you. IMO, the best approach is that we would live in a private residence with a full-time, live-in, paid caretaker, managed by our child who lives nearby. This would be hideously expensive, but, I am trying to ensure our portfolio can afford it. Meanwhile, we are on CCRC waiting lists (2) for insurance.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

stan1 wrote: Tue Sep 01, 2020 9:15 am Prudence, it seems you have been evaluating CCRC options for years now and you've posted that you can well afford it. You've stated that you and your wife would enjoy living at a carefully selected CCRC.

If I may ask, what is your criteria to end the evaluation and analysis phase and move forward with a decision?
We will wait another five years (our current ages are 73 and 69) and then do something.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

wanderer wrote: Mon Aug 31, 2020 9:54 am Did you account for the lost investment opportunity between the two options?
Say 2% over inflation: $1,011,200 - $577,800 = $433,400 left to invest for 18 years. $433,400 (1.02)^18 - $619,00. A gain of $185,602.

18 years is a long time to tie up $433K. And what guarantees do you have regarding the quality of service or the default risk of the business. The nursing home my dad was in and the CCF facility my mom was in both changed owners and service contractors at least 2 times during the 2-3 years they each lived in the facilities. Note: in both cases, the owners of the business contracted out the management and nursing staff so they were separate contracts. It seemed like constant turnover. I'd rate the default risk somewhere around BBB- or worse

And how confident in the assumptions are you for life span and inflation, investment returns, etc. Seems like significant potential variance. I take the recent fed actions to suggest they expect low inflation for the near future, whereas Warren Buffett is buying energy and commodity trading companies. That, to me implies he sees these sectors as recovering or an inflation hedge.

Bottom line, you might also run the options for hiring in-home care as suggested by the first poster.
Yes, I agree and we will try to make the in-home care work if not an unreasonable burden to family.
stan1
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Re: Continuing Care Retirement Community Entrance Fee

Post by stan1 »

Prudence wrote: Tue Sep 01, 2020 9:24 am
stan1 wrote: Tue Sep 01, 2020 9:15 am Prudence, it seems you have been evaluating CCRC options for years now and you've posted that you can well afford it. You've stated that you and your wife would enjoy living at a carefully selected CCRC.

If I may ask, what is your criteria to end the evaluation and analysis phase and move forward with a decision?
We will wait another five years (our current ages are 73 and 69) and then do something.
I think that's a good decision. I think you are a little young to move into a CCRC where you will be around a large group of much older people with declining health.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

willthrill81 wrote: Mon Aug 31, 2020 10:56 am
littlebird wrote: Mon Aug 31, 2020 10:36 am
bberris wrote: Mon Aug 31, 2020 9:16 am Consider an alternative plan: Isn't that enough money to hire in-house care when it becomes necessary and stay where you are? I'm assuming you don't need additional care help yet or is there some current disability? I presume there is also a continuing cost to the RC in addition to the fee. How is the refundable payment secured? Do you have a claim on the property if it goes bust?
In home care requires someone with a fair degree of cognitive ability to supervise, plan and regulate the caregivers. In home care does not offer much social enrichment. In home care does not provide high quality meals. In home care does not relieve elders of the burden of home maintenance, transportation and most bill-paying. In home care has its place — I recently cared for and supervised the health aides who cared for a much older spouse in the last stages of Parkinson’s Disease — but it ‘s not remotely similar to living in a CCRC.
+1

Also, many who go into CCRCs are fully capable of independent living, at least at first. They often don't need any in-home care at all. Rather, they want to age in place, build relationships, and enjoy what is often a rather pleasant environment.

About a year ago, we visited a local independent living facility (not a CCRC) and were shocked at how nice everything was. When we arrived, there were a lot of residents with their family and friends having drinks at a bar and singing karaoke. It felt very much like a cruise ship. Rooms were cleaned weekly, local transportation was provided, etc. I can entirely see the appeal of staying in such a place even if one was capable of caring for oneself in a single family home. And with a CCRC, when you need greater care, you can receive it there.
Agree completely. We are on the waiting list for a CCRC that my DW thinks would be the same as living in a resort.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

willthrill81 wrote: Mon Aug 31, 2020 11:20 am
smitcat wrote: Mon Aug 31, 2020 11:16 am
willthrill81 wrote: Mon Aug 31, 2020 10:56 am About a year ago, we visited a local independent living facility (not a CCRC) and were shocked at how nice everything was. When we arrived, there were a lot of residents with their family and friends having drinks at a bar and singing karaoke. It felt very much like a cruise ship. Rooms were cleaned weekly, local transportation was provided, etc. I can entirely see the appeal of staying in such a place even if one was capable of caring for oneself in a single family home. And with a CCRC, when you need greater care, you can receive it there.
"It felt very much like a cruise ship."
Interesting anology as we have seen a large problem with Covid19 here at a CCRC, rehabs, and nursing homes.
My analogy was actually more astute than I was aware of! :D

Our visit was well before COVID19, so it may be very different now. It has certainly shown that many elderly people living in very close proximity to each other carries its own risks.
My aunt is in a very high-end premium CCRC. She is very safe. But, since March (Covid), she says she has felt incarcerated.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

NotWhoYouThink wrote: Mon Aug 31, 2020 11:52 am Covid may have helped CCRC finances, by freeing up space for new residents. I haven't seen any overall analysis, but their incentive is always to bring in new residents and their up-front payments.

Let's hope there is not another pandemic, but the downside of CCRC living right now is that residents in most are isolated from their families. My mother died in the rehab wing of her CCRC last month. The only time she saw her family the last 4 months of her life was when she was in the hospital for a few days, because the hospital had less restrictive rules for visitors. The decline in her health was directly related to the isolation, she had been in independent living about to move into Assisted Living when the lock-down started.

We noticed that they seemed exceptionally eager to move her into Assisted Living, and realized that if they move someone there it frees up an apartment in Independent Living that they can charge the entry fee for.
This is the real tragedy of CCRCs and nursing homes: that the elderly residents are frequently miserable and lose any interest in continuing to live.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

fourwheelcycle wrote: Mon Aug 31, 2020 3:32 pm
Alan S. wrote: Mon Aug 31, 2020 11:14 am While safety of these huge entry fees has long been an area of concern, pandemics are capable of exposing vulnerabilities to the financing model.

The best way to guarantee against forfeiture of several hundred thousand dollars is to require the facility to provide a performance bond guaranteeing return of your money in the event of facility bankruptcy. I don't know if such institutions are willing to do that, but the CCRC model must be under considerable stress right now due to Covid.
Alan is right. I doubt CCRC's would ever provide performance bonds to new entrants, but Covid is certainly going to test their finances. CCRC's live and die by the cash flow from their entrance fees and monthly residential unit fees. The former depends on new entrants and the latter depends on overall occupancy levels, both of which are carefully budgeted and counted upon.

Most CCRCs deposit new entrance fees in restricted funds and release them to their annual operating budgets on an amortization schedule based on residents' remaining actuarial lifetime. If people become concerned about their intended CCRC's finances due to Covid and cancel or delay moving in, the CCRC will face a gap in their budgeted operating income from amortized entrance fees. Amortized entrance fee income can amount to 40% or more of a CCRC's overall annual operating budget.

Also, every person or couple who cancel or delay their entry means one less occupied unit for the CCRC. Since each occupied unit may provide $60-$70K of annual income, the impact of an occupancy decline from just a few more unoccupied units can be dramatic. As entrance fee and occupancy income drop, facility maintenance, staffing, and meal quality, etc., must be reduced and/or entrance fees and monthly fees must go up to maintain operations. This can quickly lead to a death spiral of fewer new residents and even lower entrance fee and monthly fee income, leaving higher monthly fees from existing residents as the only budget-balancing alternative.

Our local CCRC has not had a single case of Covid (fingers crossed), but it has experienced a short term decline in new resident move-ins simply because people do not want to board a cruise ship during a pandemic. My wife and I are still four or more years from making a move, so we have time to watch and assess the finances of our local CCRC before we have to make a decision.
Excellent post. And I am right there with you.
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Re: Continuing Care Retirement Community Entrance Fee

Post by smitcat »

Prudence wrote: Tue Sep 01, 2020 9:18 am
smitcat wrote: Mon Aug 31, 2020 9:40 am
Prudence wrote: Mon Aug 31, 2020 8:35 am DW and I are considering a move to a CCRC. This CCRC has two entrance fee options for the specific villa we are interested in: 90% refundable entrance fee or non-refundable entrance fee. I compared the present value of the cost of these two options and determined that the refundable fee would be more favorable to us. The 90% refundable fee is $1,011,200 and the non-refundable fee is $577,800. Based on my DW's life expectancy of 17.3 years, I assumed the fee would be refunded in 18 years, and assumed an average rate of inflation of 2.5%, compounded monthly. The calculation is as follows:
-$1,011,200 (fee paid now)+$580,564 (PV of $910,080 refund received in 18 years)=-$430,636 (net present value or cost in today's dollars).
So, the cost in today's dollars of the refundable fee is $147,164 less than the non-refundable fee of $577,800. Additionally, the point of indifference would be an average inflation rate of 4.12% which is unrealistically high, even with the growing national debt. Although the refundable fee has a lower cost to us, I am thinking that it may not be wise to tie up the extra $433,400 (the difference between the non-refundable and refundable fees) for 18 years. Please feel free to provide critique or comments.
Are you completely comfortable with the CCRC's future abililty to continue offering a high quality service while remaining solvent?
I think their finances are in good shape and will remain so. But, I am concerned that if and when we need significant assisted living or comprehensive care, we will be at their mercy. My mother was in a nursing home for almost three years and during that time I sadly noticed that the residents were frequently isolated and ignored by the staff (8 to 1 ratio). So, this may cancel out the main benefit of the CCRC that they will always take care of you. IMO, the best approach is that we would live in a private residence with a full-time, live-in, paid caretaker, managed by our child who lives nearby. This would be hideously expensive, but, I am trying to ensure our portfolio can afford it. Meanwhile, we are on CCRC waiting lists (2) for insurance.
I have found it very hard to evaluate any CCRC finances and was dissapointed in what we did find on a few of them. Also ...we have discovered no way of knowing how to assure that any quality or range of services will be maintained over time.
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willthrill81
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Re: Continuing Care Retirement Community Entrance Fee

Post by willthrill81 »

ScubaHogg wrote: Tue Sep 01, 2020 12:10 am
willthrill81 wrote: Mon Aug 31, 2020 11:20 am Our visit was well before COVID19, so it may be very different now. It has certainly shown that many elderly people living in very close proximity to each other carries its own risks.
Conversely, in many places, the only “company” many older citizens are getting these days are the co-residents of facilities like this, since for obvious reasons they have limited interaction with the public at large, so to speak.

Viewed in that light not living in close proximity with some other elderly people carries its own risks. Risks of social isolation in this case.
Yes, there aren't easy answers to the problem. Being separated from their family members is undoubtedly a strain on many elderly people, but the camaraderie of fellow residents must be a huge help during times as these.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
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Re: Continuing Care Retirement Community Entrance Fee

Post by TN_Boy »

Prudence wrote: Tue Sep 01, 2020 9:18 am
smitcat wrote: Mon Aug 31, 2020 9:40 am
Prudence wrote: Mon Aug 31, 2020 8:35 am DW and I are considering a move to a CCRC. This CCRC has two entrance fee options for the specific villa we are interested in: 90% refundable entrance fee or non-refundable entrance fee. I compared the present value of the cost of these two options and determined that the refundable fee would be more favorable to us. The 90% refundable fee is $1,011,200 and the non-refundable fee is $577,800. Based on my DW's life expectancy of 17.3 years, I assumed the fee would be refunded in 18 years, and assumed an average rate of inflation of 2.5%, compounded monthly. The calculation is as follows:
-$1,011,200 (fee paid now)+$580,564 (PV of $910,080 refund received in 18 years)=-$430,636 (net present value or cost in today's dollars).
So, the cost in today's dollars of the refundable fee is $147,164 less than the non-refundable fee of $577,800. Additionally, the point of indifference would be an average inflation rate of 4.12% which is unrealistically high, even with the growing national debt. Although the refundable fee has a lower cost to us, I am thinking that it may not be wise to tie up the extra $433,400 (the difference between the non-refundable and refundable fees) for 18 years. Please feel free to provide critique or comments.
Are you completely comfortable with the CCRC's future abililty to continue offering a high quality service while remaining solvent?
I think their finances are in good shape and will remain so. But, I am concerned that if and when we need significant assisted living or comprehensive care, we will be at their mercy. My mother was in a nursing home for almost three years and during that time I sadly noticed that the residents were frequently isolated and ignored by the staff (8 to 1 ratio). So, this may cancel out the main benefit of the CCRC that they will always take care of you. IMO, the best approach is that we would live in a private residence with a full-time, live-in, paid caretaker, managed by our child who lives nearby. This would be hideously expensive, but, I am trying to ensure our portfolio can afford it. Meanwhile, we are on CCRC waiting lists (2) for insurance.
I think you are right to worry about this "So, this may cancel out the main benefit of the CCRC that they will always take care of you."

I've seen these comments in this thread about CCRCs:

"they either have no children or do not want to impose any burden on their own children to arrange and supervise their care when they become older."

and

"Since we have no children, we are very likely to go directly from our work-life home to such a place. "

and

"Yes, I would prefer aging in place because our house is in an excellent location (since 1980). The issue is to avoid becoming a burden to family in the future."

And frankly, I don't understand what people are thinking when they make these comments. First, I'll be clear I have not worked with CCRCs housing relatives of mine (though I know people who have done this and nothing in their experience contradicts what I am about to say).

The notion that a CCRC substantially reduces the need for family help/monitoring of an aging person strikes me as (sorry but I have to say this) hopelessly naive.

This is based on helping two family members, one of them very extensively, and managing a total of four moves (as people decline). I cannot fathom how a CCRC would substantially change the help needed. And I know other people who have dealt with aging parents and such.

Who manages the finances -- pays the bills, etc. Does the CCRC take over management of bills and investments. Would you really want that??

Who decides what care level is needed -- independent, assisted living, etc. Do you really want a CCRC making those decisions?

Who coordinates medical care? Between GP, various specialists, hospital visits, etc. Do you really think a CCRC can/will do that? I'm not talking transportation to the doctors office. I'm talking understanding the medical problems and coordinating between providers.

Who monitors the care being received at a facility? The CCRC? Wait, the CCRC is PROVIDING the care ..... and it doesn't matter a bit whether we are talking a CCRC or the finest care facility in your state. You want the best care for somebody, you have to be involved. Staffing levels will *always* be an issue. Turnover of staff providing the hands-on care is *always* an issue.

I could go on. While picking the appropriate care facility and making a move happen is painful, it's generally not what takes the most time, since the move occurs over a relatively limited time-frame. What takes the time is completely managing the money, ensuring that whatever care is being provided is high quality, balancing health care decisions (there are many many health care decisions the CCRC cannot and should not be making). And the phone calls .... mom or dad fell ..... mom or is losing weight ...... they have condition X, is surgery the right choice ...... mom or dad was taken to the hospital, will you be meeting them at the ER .......

Where I see a CCRC as appealing is if you move in while independent, make a lot of friends, and as you need more care with physical issues, you can get that help -- possibly by moving to another location within the campus -- and still see your friends. For people who develop dementia, that could be valuable to the spouse -- they still have a support group of friends to lean on. In fact, I could see support of the spouse who doesn't need as much help as a big benefit of a CCRC.

But if, for example, your parents are in a CCRC, and one dies and then the other develops a lot of issues, the survivor needs (ideally) involved family to ensure the right things happen. At that point any notion the CCRC takes much burden off kids is sadly mistaken. Especially when a person develops dementia, well, somebody has to make the decisions for that person and there are a lot of decisions to be made.
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Re: Continuing Care Retirement Community Entrance Fee

Post by TN_Boy »

willthrill81 wrote: Tue Sep 01, 2020 11:58 am
ScubaHogg wrote: Tue Sep 01, 2020 12:10 am
willthrill81 wrote: Mon Aug 31, 2020 11:20 am Our visit was well before COVID19, so it may be very different now. It has certainly shown that many elderly people living in very close proximity to each other carries its own risks.
Conversely, in many places, the only “company” many older citizens are getting these days are the co-residents of facilities like this, since for obvious reasons they have limited interaction with the public at large, so to speak.

Viewed in that light not living in close proximity with some other elderly people carries its own risks. Risks of social isolation in this case.
Yes, there aren't easy answers to the problem. Being separated from their family members is undoubtedly a strain on many elderly people, but the camaraderie of fellow residents must be a huge help during times as these.
Not so much. Many communal activities have been eliminated, at least in facilities in my state.

It's been a disaster in all ways for both residents and families of the residents.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

Dear TN Boy: I agree with you so I (we) have decided to join waiting lists for two excellent CCRCs and then wait about five years when we will reassess what we want or need to do. It is ironic that people are who very happy with moving to a CCRC are those that have moved to the independent living residences where they can have friends and activities etc. I(we) don't need that so we are content to stay put and avoid the huge cost of the CCRC until later. I agree strongly that those who wind up in assisted living or comprehensive care will face significant challenges and will need involvement and support of family.
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Re: Continuing Care Retirement Community Entrance Fee

Post by NotWhoYouThink »

Prudence wrote: Tue Sep 01, 2020 9:35 am


This is the real tragedy of CCRCs and nursing homes: that the elderly residents are frequently miserable and lose any interest in continuing to live.
The first 7 or 8 years there were great - she could get out, there was transportation available when she wasn't feeling well enough to drive, she could meet friends for mah jongg or bridge without anyone needing to drive, there really were a lot of advantages.

She and her friends all saw their families often. Before Covid.

It has been since Covid that "protected" started to mean "isolated." Not a good answer for that.
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Re: Continuing Care Retirement Community Entrance Fee

Post by fuddbogle »

Prudence wrote: Tue Sep 01, 2020 9:18 am
smitcat wrote: Mon Aug 31, 2020 9:40 am
Prudence wrote: Mon Aug 31, 2020 8:35 am DW and I are considering a move to a CCRC. This CCRC has two entrance fee options for the specific villa we are interested in: 90% refundable entrance fee or non-refundable entrance fee. I compared the present value of the cost of these two options and determined that the refundable fee would be more favorable to us. The 90% refundable fee is $1,011,200 and the non-refundable fee is $577,800. Based on my DW's life expectancy of 17.3 years, I assumed the fee would be refunded in 18 years, and assumed an average rate of inflation of 2.5%, compounded monthly. The calculation is as follows:
-$1,011,200 (fee paid now)+$580,564 (PV of $910,080 refund received in 18 years)=-$430,636 (net present value or cost in today's dollars).
So, the cost in today's dollars of the refundable fee is $147,164 less than the non-refundable fee of $577,800. Additionally, the point of indifference would be an average inflation rate of 4.12% which is unrealistically high, even with the growing national debt. Although the refundable fee has a lower cost to us, I am thinking that it may not be wise to tie up the extra $433,400 (the difference between the non-refundable and refundable fees) for 18 years. Please feel free to provide critique or comments.
Are you completely comfortable with the CCRC's future abililty to continue offering a high quality service while remaining solvent?
I think their finances are in good shape and will remain so. But, I am concerned that if and when we need significant assisted living or comprehensive care, we will be at their mercy. My mother was in a nursing home for almost three years and during that time I sadly noticed that the residents were frequently isolated and ignored by the staff (8 to 1 ratio). So, this may cancel out the main benefit of the CCRC that they will always take care of you. IMO, the best approach is that we would live in a private residence with a full-time, live-in, paid caretaker, managed by our child who lives nearby. This would be hideously expensive, but, I am trying to ensure our portfolio can afford it. Meanwhile, we are on CCRC waiting lists (2) for insurance.
We (family) provided the services to allow my MIL to have in-home care 24/7/365. She had multiple strokes that left her unable to walk, barely speak or eat non-pureed food. She initially went to a very good nursing home. However everytime my wife visited her she cried and said all she wanted was to go home. So my wife brought her home.

We started with a service but ended up with a few ladies who provided this service on their own. One was fantastic and she would find another caregiver when one left (they were all 1099'd). It was group of ladies originally from Africa that we settled on and they provided wonderful service. They became like a second family. Honestly, far better service than any American provider we encountered. My BIL paid them about $225/day (LCOL area) and they lived with my MIL, one week on, one week off. They also were provided all meals, laundry, etc when living with my MIL.

They did all of the cooking, cleaning, washing and provided her dailly medication (my wife put in a pill box), read her the newspaper, worshiped with her, etc...

My wife provided service for all of the medical trips, delivered medication and groceries/home supplies based on a weekly list provided to us by the caregivers.
My BIL's provided the lawn service, home repair, and managed the money and payments.

My MIL lived 8-years like this and it worked extremely well. It was mentally hard on my wife but it was much easier on her once my MIL was able to leave the nursing home. I don't believe my MIL would have ever lasted 8-years in a nursing home, she would have lost the will to live, IMO. That was what she wanted and I know others are different but for her it worked as well as it could given her circumstances.
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Re: Continuing Care Retirement Community Entrance Fee

Post by visualguy »

TN_Boy wrote: Tue Sep 01, 2020 12:49 pm The notion that a CCRC substantially reduces the need for family help/monitoring of an aging person strikes me as (sorry but I have to say this) hopelessly naive.
That's true. I think people are referring to taking care of an aging person outside a CCRC (harder) vs inside (easier), but, at the stage when the person can't take care of themselves, the CCRC acts as a nursing home, and it's not clear how a CCRC makes things any easier than a nursing home in terms of family involvement.

Being in that situation without family has been discussed on some other threads. There isn't really a good solution for that. It's one of those problems that money can't solve.
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Re: Continuing Care Retirement Community Entrance Fee

Post by RetiredAL »

Prudence wrote: Tue Sep 01, 2020 9:26 am
Yes, I agree and we will try to make the in-home care work if not an unreasonable burden to family.
Prudence - a perspective.

For my Dad just last year, I looked at 24hr home care vs Assisted Living. Home care would have run 18-19K per month. A Calif MCOL area.

As my Mom declined before she passed 7 years ago, my Dad took care of her in their longtime home. He only had some outside part time help 2 times a week for her last 6 months.
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Prudence
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Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

RetiredAL wrote: Tue Sep 01, 2020 2:26 pm
Prudence wrote: Tue Sep 01, 2020 9:26 am
Yes, I agree and we will try to make the in-home care work if not an unreasonable burden to family.
Prudence - a perspective.

For my Dad just last year, I looked at 24hr home care vs Assisted Living. Home care would have run 18-19K per month. A Calif MCOL area.

As my Mom declined before she passed 7 years ago, my Dad took care of her in their longtime home. He only had some outside part time help 2 times a week for her last 6 months.
Yeah, if we move to the CCRC and one of us most move to the comprehensive care unit, the monthly fee (for one person) jumps to about $15,000. What did you decide to do regarding your Dad?
shell921
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Re: Continuing Care Retirement Community Entrance Fee

Post by shell921 »

My sister in law --at age 66 --became a caregiver for 7+ years for an elderly woman-beginning when the woman was age 90
My sis-in-law cared for her for 7+ years. She was like family to this older woman.
The older lady finally died a month ago- at age 103.
Older woman went to assisted living at age 97 [ my sis in law was almost 68] because my sis-in-law was burned out !!
My sis in law worked for this woman 7 days a week! She got exhausted after about 3 years of this and the family tried to find "relief"
caregivers to give my sis-in-law some days off! The older woman was unhappy with all the relief caregivers and she was lonely and
all her friends were dead. She was cranky and difficult. My sis-in-law finally said she had to quit and that's when the older woman
went into assisted living.
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Re: Continuing Care Retirement Community Entrance Fee

Post by crefwatch »

Depending on the state and its current Covid rates, you should not assume that the miserable isolation of a CCRC or Skilled Nursing Home is the worst possible thing. For five months, I was prohibited from visiting my mother in a NJ nursing home. But they have had very few deaths, and the care remains excellent when I call to check on her. Now I can visit once a week outdoors without contact. That's not great, but it means this 94 year old is not likely to die of Covid-19. A slightly younger friend of mine is in a CCRC in PA, and his food is now left at his Assisted Living apartment door. His pills are portioned out to him and packaged for self-administration, because he is quite capable. How does that compare with the "independent" elderly outside who have to find someone to shop for them and leave things on their doorstep?

Of course it's not the greatest thing since sliced bread. But all the people who are so sanguine about a gradual decline and a peaceful death may not be foreseeing their own future. Friend #2 was much older than his wife. But she tripped and fell down the stairs to the basement. So he's now the one alone.
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Re: Continuing Care Retirement Community Entrance Fee

Post by RetiredAL »

Prudence wrote: Tue Sep 01, 2020 3:00 pm
RetiredAL wrote: Tue Sep 01, 2020 2:26 pm
Prudence wrote: Tue Sep 01, 2020 9:26 am
Yes, I agree and we will try to make the in-home care work if not an unreasonable burden to family.
Prudence - a perspective.

For my Dad just last year, I looked at 24hr home care vs Assisted Living. Home care would have run 18-19K per month. A Calif MCOL area.

As my Mom declined before she passed 7 years ago, my Dad took care of her in their longtime home. He only had some outside part time help 2 times a week for her last 6 months.
Yeah, if we move to the CCRC and one of us most move to the comprehensive care unit, the monthly fee (for one person) jumps to about $15,000. What did you decide to do regarding your Dad?
I placed him in Assisted Living.

As long as one does not need frequent medical, they will keep the residents in Assisted, but a hospice person may be required. There has been 2 ladies in his ALF that required eating assistance, and they coordinate that with outside people, or day-off staffers.

This is a non-profit with Independent, Assisted, Memory, and Skilled Nursing on-site. It is not a CRCC. They call themselves a Life Plan Community. When my Mom passed, my Dad (then 89) considered moving there as an Independent but decided to stay at home. He did well living by himself until 18 months ago, when he suddenly declined. I live 90 miles away.
RudyS
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Re: Continuing Care Retirement Community Entrance Fee

Post by RudyS »

Prudence wrote: Tue Sep 01, 2020 3:00 pm
RetiredAL wrote: Tue Sep 01, 2020 2:26 pm
Prudence wrote: Tue Sep 01, 2020 9:26 am
Yes, I agree and we will try to make the in-home care work if not an unreasonable burden to family.
Prudence - a perspective.

For my Dad just last year, I looked at 24hr home care vs Assisted Living. Home care would have run 18-19K per month. A Calif MCOL area.

As my Mom declined before she passed 7 years ago, my Dad took care of her in their longtime home. He only had some outside part time help 2 times a week for her last 6 months.
Yeah, if we move to the CCRC and one of us most move to the comprehensive care unit, the monthly fee (for one person) jumps to about $15,000. What did you decide to do regarding your Dad?
So much varies from one CCRC to another. In ours, the increase in monthly fee if one of us moves to assisted living, or skilled nursing, is only $1600.

But allow me to add our (DW 79, me 83) perspective. Made the move from Midwest to Boston area to be closer to our two kids, and grandkids, about 18 months ago. When we, several years earlier, decided that it would be time to move from our 2 story house to single level living, we first looked at condos. Nothing really appealed, and then, thanks to Bogleheads, I learned about CCRCs as an option.

Did a lot of research, and decided on our current home. Large buy-in, and stiff monthly fee, but trivial extra cost if/when one or both need to move to assisted living or skilled nursing. It's in different floors of the same building. We were very happy with our decision. Then COVID hit. We are still happy here, feeling safe due to the various precautions taken. No COVID cases in independent living, just a couple in skilled nursing. All community activities stopped, meals delivered to our doors and for a couple of weeks we could not leave the property. Starting to open up slowly now.

It is required that new residents be healthy (physical and mental) to qualify to join the community. Someone here said "better 5 years too soon than 5 minutes too late." We are about the average ages for new residents. Some folks do very well here; a couple are over 100 years old. And still active in the community.
RetiredAL
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Re: Continuing Care Retirement Community Entrance Fee

Post by RetiredAL »

crefwatch wrote: Tue Sep 01, 2020 3:46 pm Depending on the state and its current Covid rates, you should not assume that the miserable isolation of a CCRC or Skilled Nursing Home is the worst possible thing. For five months, I was prohibited from visiting my mother in a NJ nursing home. But they have had very few deaths, and the care remains excellent when I call to check on her. Now I can visit once a week outdoors without contact. That's not great, but it means this 94 year old is not likely to die of Covid-19. A slightly younger friend of mine is in a CCRC in PA, and his food is now left at his Assisted Living apartment door. His pills are portioned out to him and packaged for self-administration, because he is quite capable. How does that compare with the "independent" elderly outside who have to find someone to shop for them and leave things on their doorstep?

Of course it's not the greatest thing since sliced bread. But all the people who are so sanguine about a gradual decline and a peaceful death may not be foreseeing their own future. Friend #2 was much older than his wife. But she tripped and fell down the stairs to the basement. So he's now the one alone.
I agree people should not assume. There has been no CV-19 in the Assisted Living units where my Dad is. The county is a hot spot right now. They have had 2 cases in Independent Living and several staffers have tested positive. They screen the staff before the start of each shift. Can one say that of in-home care? I've fretted about this, but I do feel he's safer where his is, than at home with 24x7 support.

Visitation has been rough. Outsiders are not allowed on campus. My visits are they will bring my Dad out to the complex's entry area and I can visit him through the fence. Group gathering are not allowed, so their music entertainment has been cancelled. They eat in their rooms, not in the dining area. Then again, DW and I have not eaten in a restaurant since this all started.
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BogleFanGal
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Re: Continuing Care Retirement Community Entrance Fee

Post by BogleFanGal »

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Last edited by BogleFanGal on Wed Sep 02, 2020 2:07 pm, edited 2 times in total.
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fandango
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Re: Continuing Care Retirement Community Entrance Fee

Post by fandango »

We have a large CCRC about 30 miles from us.

We currently live in a 55+ community, and we were impressed 4 or 5 years ago when the CEO of the CCRC came to visit us and made a presentation.

A few years later some of his staff members came and did another presentation. The focused mainly on $$$ and rules. Rules and more rules.

We decided that we weren't ready for that level of institutionalization. The rule thing really turned us off. The focus did not seem to on residents but on the rules of the institution.

My caution would be to check our CCRC several times and try to get down to the people who run it day by day. Anyone can put together a glossy brochure.
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David Jay
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Re: Continuing Care Retirement Community Entrance Fee

Post by David Jay »

RudyS wrote: Mon Aug 31, 2020 12:21 pm What if, heaven forbid, you don't make it till DW is 17? Say you both go under the bus in few years? The kids (if any) get nothing under the nonrefundable option.
Actually they get some $600,000 under the non-refundable option as follows (substitute, say, 16 for the power):
wanderer wrote: Mon Aug 31, 2020 9:54 am$433,400 left to invest for 18 years. $433,400 (1.02)^18 - $619,000.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius
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