Continuing Care Retirement Community Entrance Fee

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
bberris
Posts: 1528
Joined: Sun Feb 20, 2011 9:44 am

Re: Continuing Care Retirement Community Entrance Fee

Post by bberris »

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.
Of course it can. The CCRC gets the funds for the refund when they resell the unit. The buildings are probably mortgaged to the max. You can't get blood from a stone.
Whakamole
Posts: 1188
Joined: Wed Jan 13, 2016 9:59 pm

Re: Continuing Care Retirement Community Entrance Fee

Post by Whakamole »

thursdaysd wrote: Thu Sep 10, 2020 9:37 am I am over 70 and immuno-compromised and live alone. I am being very careful and only "meeting" people by phone/internet. You think "socially isolated" only happens in CCRCs? I think I would be better off if I had already moved to one.
For you, yes, it sounds ideal. My relative has a single bedroom that she can't leave (and I don't think anyone can enter, maybe critical maintenance?), all meals are contact-less. That system will protect against other infectious diseases as well.
Topic Author
Prudence
Posts: 564
Joined: Fri Mar 09, 2012 4:55 pm

Re: Continuing Care Retirement Community Entrance Fee

Post by Prudence »

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.
Dottie57
Posts: 9061
Joined: Thu May 19, 2016 5:43 pm
Location: Earth Northern Hemisphere

Re: Continuing Care Retirement Community Entrance Fee

Post by Dottie57 »

TN_Boy wrote: Tue Sep 01, 2020 12:53 pm
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.
+1 I know that in my state communal living became almost a prison where residents had to stay in their residence and meals and mail delivered to them. Not sure about independent living facilities.
User avatar
thursdaysd
Posts: 89
Joined: Tue May 13, 2014 10:55 am
Location: NC
Contact:

Re: Continuing Care Retirement Community Entrance Fee

Post by thursdaysd »

It's been a disaster in all ways for both residents and families of the residents.
For whom has it not been a disaster? As I posted, I am doubly at risk and live alone. I would be delighted if someone else was cooking and delivering my meals, etc. etc.
Thursday's child has far to go
Saving$
Posts: 1974
Joined: Sat Nov 05, 2011 8:33 pm

Re: Continuing Care Retirement Community Entrance Fee

Post by Saving$ »

TN_Boy wrote: Wed Sep 09, 2020 9:15 pm
Saving$ wrote: Wed Sep 09, 2020 7:59 pm Another issue to consider with the CCRC's is nursing care and Medicare compatibility.
I managed the affairs of an elderly relative who was moved from the hospital to a nursing home after a stroke. The relative's Medicare policy was linked to an HMO. The HMO had a list of nursing facilities they worked with, where they had rounding doctors, nurses and social workers. The relative wanted to move to a nicer nursing facility; there happened to be a 2 year old CCRC with very nice facilities that was taking outside private pay patients to fill up empty beds in the CCRC's nursing wing. It was in the right area of town to facilities visits from family and friends and would have been perfect, except..... the Medicare HMO did not have a contract with this facility, so routine medical care would all be out of network. The other option would have been to change this persons Medicare plan to one that included the CCRC's nursing facility. Due to the number of medical complication and the excellent and well coordinated care the relative was receiving from the HMO team, nobody in the family was willing to take on identifying, transferring and arranging for an entire new medical team, that without the HMO's managed care model, would probably not be as good. Thus we did not move the relative to the CCRC's nursing facility.

But what if you moved to a CCRC, and have a team of medical providers through your Medicare plan. Then 10 years down the road, when you need to move to the CCRC's skilled nursing wing you find out the CCRC's nursing wing no longer participates in the medical network of your Medicare plan? Now you either have to change medical teams (which can be very daunting if you are ill enough to need skilled nursing) or pay your medical expenses out of network?
How common is it that a person's "Medicare policy was linked to an HMO?" If someone had (what I think is) a more typical arrangement of Medicare plus perhaps supplemental insurance, would there have been any issues with the CCRC?

Also, of course, in your example, someone might move to a skilled nursing facility, and after the move the facility might stop participating in the "medical network of your Medicare plan."

I guess I'm mostly asking about the precondition here -- that medicare is linked to an HMO, a setup I'm unfamilar with.

My experience is mostly (for someone else) with Medicare and a good supplemental plan, and those two are paying for hospital bills across multiple hospitals, for rehab facilities, for various non-hospital doctors .... I've been shocked at how little out of pocket expense there have been.

To be clear, I'm not doubting your post, I'm looking for a better understanding of this particular type of Medicare plan.
Probably a poor choice of words on my part. I think it was a Medicare Advantage Plan associated with an HMO. The relative's entire care network of doctors and specialists was at that HMO. That HMO had a list of 20 or so nursing homes with whom they had agreements. Any other nursing home and the medical care would have been a) out of network and b) not nearly as well coordinated as it was with the HMO (I was actually shocked at how well they coordinated care among specialists without being prompted or badgered at all and how well that seemed to work, especially after dealing with another relative whose care was entirely uncoordinated).
User avatar
LilyFleur
Posts: 1458
Joined: Fri Mar 02, 2018 10:36 pm

Re: Continuing Care Retirement Community Entrance Fee

Post by LilyFleur »

Prudence wrote: Fri Sep 04, 2020 9:34 am
smitcat wrote: Fri Sep 04, 2020 9:18 am
sarahjane wrote: Thu Sep 03, 2020 10:18 pm CCRCs are Ponzi schemes. New entry fees go to support existing residents. There is seldom any leeway if occupancy levels fall because of something like this virus. We are on list for well respected ccrc but even before the pandemic its largest asset was goodwill which has no $$value. So you are at the mercy of the market whether this will all work out.
Would you please post some data and the link to the source(s) that supports the % of goodwill and the observation that CCRC's are ponzi schemes.
Thank you
They are not Ponzi schemes. But, as you probably know, the entrance fee is not refunded until a new resident pays his or her entrance fee and takes occupancy of the vacated unit. So, if there was a significant decrease in occupancy, the fee may not be refunded for several months, years, or ever if a bankruptcy ensues under certain conditions. Also, some CCRCs have rules that will reduce the amount of a refundable entrance fee if, for example, their entrance fees have dropped after a resident signed his or her residency agreement. Experts recommend that a lawyer review the residency agreement before signing (and make sure the deposit is fully refundable).
We had an attorney review the contract. They suggested revising it to state that the refundable entrance fee be paid to the heirs within 6 months of our parent's death. The board of the institution had to approve this change, and they did.
Post Reply