Prudence wrote: ↑Thu Sep 10, 2020 10:26 am
chw wrote: ↑Sun Sep 06, 2020 7:04 pm
Present value aside, I would be more concerned about the CCRC’s ability to refund the fee when the time comes. Review the contract closely to determine if the fee could be wiped out/reduced in a bankruptcy.
Agree. Refundable entrance fees are refunded only when the unit is re-occupied by a new resident. Therefore, if a CCRC were to have a significant increase in vacated units for any reason, the residents would likely lose a significant percentage, if not all, of their refundable entrance fees. In the event of a bankruptcy, any available funds would be used to first pay off bondholders. Although we are currently on two CCRC waiting lists, the more I have learned about CCRCs, the more skeptical I have become. Regarding the refundable entrance fee, one must accept that those funds could be gone forever.
Whether the refund depends upon a new resident probably varies by facility. Or perhaps by whether there is a long waiting list (although this could vary over time, whereas the terms of the main contract likely don't change back and forth).
We've only got a $750 non-refundable "deposit" down for the waiting list where we expect to go, and we were quite surprised that was all they wanted to give us a place in the queue. (The queue position can be adjusted from choices like "asap" or "expected in 3-5 years", etc., as well as unit size (or "first available of X size".) We didn't mind the 'non-refundable' nature of this fee, given it was quite a low cost in the scheme of things here.
But this facility isn't a true CCRC, with all care "guaranteed" in the future.
MIL was there until she passed recently, so we had a good chance to get to know the place from the inside, and the more we saw, the more impressed we became (a nice surprise).
They do have a hefty entry free, and a sliding scale for the amount of entry fee and the associated percentage refund. So if you want a higher percentage refunded, you pay more up front. If you want to pay less up front, you get a smaller refund percentage. And the entry fee depends upon the size of the apartment or cottage, etc.
And there is still a relatively high monthly charge, although the extra for a second person in the apartment is low.
This is at the Independent Living phase.
If one enters at ALF (Assisted Living Facility) or Skilled Nursing (SN) stay, it's just a hefty monthly fee, but they do some serious financial vetting, as they have a policy of not kicking anyone out if they run out of money. The intensive vetting makes it almost like a "real" CCRC. It's a bit odd that only the Independent Living section has that hefty semi-non-refundable entry fee.
If we do enter at the Independent stage, and then transition to the ALF section, we'd use the refund to continue the (higher) monthly payments for the more significant level(s) of care.
We got to see how the "if you run out of money" works. MIL was within less than a year of running out of money, and she was already in Skilled Nursing. We had already started filling out the paperwork for Medicaid, but she passed about 5 weeks short of her 100th birthday.
If one is still in ALF as running out of money looms, they try to get them certified for Skilled Nursing, move them there, and then within the year, change them to Medicaid.
[We are really surprised that this facility will switch to Medicaid. It's one of the most expensive in the area, with a waiting list, sometimes very long. It's non-profit, but still... the money has to come from somewhere.]
She didn't have COVID, but the loneliness probably contributed to her demise at that point, since they were on a very strict lockdown. Previously, they had set up a tent (mostly open sides) for visits, and everyone (except the resident depending upon medical condition) had to wear a mask, 6+ feet separation at all a times, with a "chaperone" to enforce that.
DH was in very frequent contact with her and several staff/medical members, and it was clear she was going down hill, and starting to exhibit some "not-optomistic" signs.
He was allowed to visit in person, and she passed the next day. It was as if she had been waiting to see him first...
We'll obviously have the contract reviewed in far more detail when we get closer.
For now, we have postponed any plans to downsize, as this isn't the time to be visiting apartments or condos (with no stairs!), or to have anyone trooping through our house as part of selling.
And we can't really move to the Independent Living section anyway, until DH actually retires (or goes < half time), as the significant money is in a 403b, which is inaccessible until then.
As for COVID, they did have a few cases early on, and a few people did pass away.
For now, at least, there are no cases among residents, although a few staff members are quarantined at their homes. But that's not too much reassurance, given the possiblity of asymptomatic transmission.
We did get a few emails about Independent Living, offering some minimal "specials".
At least it's not a high rise, with the highest level being third floor. So many people could walk up and avoid elevators if they preferred.
It's a huge decisions, and COVID makes even more tricky.
At least, vaccinations begin there next week.