✨ Pricing; Costs; Finances

Some seniors consider remaining at home a better option that planning for a continuum of care. There are hidden costs and risks. Here's an article that identifies some of them and provides some statistics on national averages for the cost on living in a managed care community.

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Richmond Shreve

NaCCRA Board Member & VP

Forum Moderator

McKnights also has a story.

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Richmond Shreve

NaCCRA Board Member & VP

Forum Moderator

I had read this article this morning; everyone should receive these newsletters which cater to management. They’re very enlightening and disheartening.

The analysis is typical of many marketing blurbs that mysteriously look similar (this same language is used by Leading Age) but they forget to mention a major problem with such cost comparisons. It can be impossible to guarantee the true costs of living in any senior living facility which allows for either rent increases or changes in the offered services. These costs are far from fixed.

Thanks, Richmond, for publishing these articles.

They do have useful information, but from my perspective, they are lopsided. While cost is an essential aspect of the decision about staying at home vs. moving into a facility, there are many more aspects. Some a plus or a minus for each option, depending on what's important to the prospect.

As a prospect, I value my independence and the comfort I have in my own home. I am very concerned about the quality of care and environment in Assisted Living in a senior living community, something that is very hard to assess before one becomes a "hostage" or an "inmate", as some CCRC residents call themselves. Also there is little control of the costs in either environment and zero guarantee for anything when it comes to services, care in particular in a CCRC. SN "disappeared" in most CCRCs and Type A CCRCs are a rarity. "Continuum of care", "care for lifetime" and "aging in place" in a CCRC are also mostly just marketing labels. I found no acceptable place for aging, with quality care and reliable for the duration of my life, regardless of the cost.

This has been an interesting discussion. What I haven’t seen is discussion of the social/psychological benefits of living in a CCRC. I live in a type A CCRC and am currently in independent living. My friends in assisted living and healthcare here are very positive about their experience in these “licensed areas.” But regardless of which area/level of care you are in here, you are not isolated as people can become when aging in place/at home. By eating together and participating in the many activities and committees available residents are stimulated, happy, engaged. Studies show that social engagement is one of the important activities for keeping our brains functioning well.

Patrice, many are isolated at CCRCs in Independent Living for various reasons. One of the volunteer tasks working with residents in healthcare is to help with loneliness.

Linda Kilcrease

Resident of a CCRC

Living at home alone can be dangerous, because recent studies show the decline into dementia increases by 50% for those living alone. I am in Independent Living and have far more social interaction than anyone living at home alone. Those in Assisted Living and even Memory Care have lots of social interaction. Of course there are those who self isolate and they decline far more rapidly. If you stay at home, as you inevitably decline, you must purchase increasly expense home care. Yes, it costs more to move from Independent to Assisted to Memory Care.

After my wife passed I decided to stay for the social interaction and virtually instant response if I were to have problems.

Fortunately, I can afford it!

Charles Nadler

Wind Crest CCRC (Erickson Senior Living)

Highlands Ranch, Colorado

I had read this article this morning; everyone should receive these newsletters which cater to management. They’re very enlightening and disheartening.

The analysis is typical of many marketing blurbs that mysteriously look similar (this same language is used by Leading Age) but they forget to mention a major problem with such cost comparisons. It can be impossible to guarantee the true costs of living in any senior living facility which allows for either rent increases or changes in the offered services. These costs are far from fixed.

All this assumes that the promises of CCRC living, from IL through higher levels of care to death, are fulfilled at the costs expected. CCRC regulation skews toward provider solvency not resident satisfaction. After becoming a member of a Type A or other entrance fee CCRC it is financially difficult, if not impossible, to take one's business elsewhere. This gets more difficult as one ages or has a deterioration in health status.

Just another consideration in the decision to age in place versus some kind of community living.

What it comes down to for me is this: I figure I'm going to run into problems as I age. Would I rather confront these problems in a community of people working together to overcome our shared problems or on my own?

Kristin,

The resolution of the cost/pricing dilemma lies with the community. The value proposition we all responded to was the unwritten and unenforceable promise that we would face advanced age and increasing dependency among a community of staff and fellow seniors who would be caring. Hence the name: Continuing Care Retirement Community. No one knows what the future holds for us individually and collectively. But we know intuitively that it's best to band together and share our resources. Even if you have a fee-for-service contract, a CCRC is an effort to pool risk and achieve strength and resilience through numbers.

There are a few CCRCs that have large endowments. They may be able to weather periods when community revenue is not adequate to meet expenses. For the rest, it's essential to maintain a margin or surplus sufficient to cover capital replacement. So we may not agree with management about priorities, but as a community we need to look honestly at the economic realities. If either providers or residents fail to understand the circumstances the community operates in, resilience is lost and trouble looms.

We have witnessed situations in which communities have been unable to meet their obligations to creditors and cover expenses. Some negotiate mergers or acquisitions, others file for bankruptcy, and occasionally a white knight rescues a community. The challenge of rising costs is met differently at the high end of the market spectrum. There, prices seem to be elastic. More seniors have the financial resources to qualify for communities with seven-figure entry fees. At the low end, federal and state subsidy programs (Medicare, Medicaid) and charitable donations figure prominently. These days, even those sources are unpredictable.

The midrange is shrinking.

Each of us needs to work with the leaders of our resident community to stay engaged and to demand that management keep them (and us) abreast of the threats and opportunities facing the community as it works to prosper. We can achieve the caring community we want in many different ways with unity of purpose and abiding good faith. Change can be met with resilience. The economic level each community achieves is less important than the social intangibles of belonging, caring, having agency, feeling secure, and enjoying companionship. It's the people we know that draw us together, not the amenities and services.

Richmond Shreve

NaCCRA Board Member & VP

Forum Moderator

As a prospect, I would love to see a survey of residents in different communities where residents would answer honestly one question: if they had the chance to make the decision to join the CCRC where they are now, would they make the same decision vs. staying in their home or picking a rental where they would not be tied for life to the CCRC, with no options for a change?

In my experience, talking to residents might not be very useful. Some CCRCs reward residents who sell the community, so residents act as sales/marketing representatives, trying to increase occupancy. As a result, it is very difficult to get honest answers and learn the truth about a community before joining.

Many just seem to be resigned to whatever they have, as there is no way back or out.

Beyond of the cost, the price increases and the financial soundness of a community, which are obviously very important, there are many other "variables" that can make or break the "value" of living in a CCRC. One has to wait potentially for many years to "get in" and then learn that the community they joined for a lot of money doesn't really match their expectations. There seems to be no practical way of evaluating the "social fit" and the true quality of care before joining and spending potentially a few years there until fully understanding what the community means and offers. By then it is too late if one doesn't find what they hoped for. That's why a survey like the one I mentioned above could be really helpful.

Your comments on the topic would be appreciated.

Relative to the last comment, I, who have lived for over two years in my CCRC and was on the waiting list for seven years, I would like to see legislation or at least a national policy that once a year, applicants are notified of changes since they paid their deposit - or however they officially joined the waiting list.

Similar to what banks and online merchants are required to do, a notice of changes in the previous year as regards, fees or fee increase percentages, services added or removed, policies that have changed, etc. would alleviate some of the shock at the contract-signing when one may have already sold their only home, put their belongings in storage and are about to sign a contract only to find out several things are not what they were in their earlier meetings with the marketing personnel.

Susan, questions include who would offer the survey? If a CCRC management runs the survey, it will be tightly controlled as to process, what questions are asked and how the results are provided. Tight control and marketing focused. Residents cannot run their own survey in a CCRC as there are rules forbidding polls, petitions and such so residents cannot really do a full survey of all residents, at best a subset, and any participants would have to have given permission (opted in to some mail list for example) first for a survey to be sent to them.

If the survey is from outside the CCRC, how do you reach residents? If not all residents can participate within a CCRC(s), it will be skewed by those who respond. Consider if everyone on this forum responded to a random survey, do you think that would be representative of the broad range of views needed? I don't think so.

Linda Kilcrease

Resident of a CCRC

You are right, Linda.

Unfortunately regardless how much money one pays, there is nothing in the many contracts I have seen that enforces anything that a senior living community has to provide. They can stop providing anything they decide to no longer provide.

From yesterday’s news:

PORTLAND, Ore. (KOIN) — A Tigard-based healthcare provider is planning multiple rounds of layoffs.

In a press release issued Monday, the company announced that it will move away from skilled nursing operations and focus its investment and growth on senior housing communities as well as home-based services.

In a notice filed Tuesday, Avamere Health Services announced a restructuring of the company expected to impact 129 employees beginning on Sept. 1.

Additional cuts are expected Oct. 1 and over the following months on a rolling basis, according to the notice Worker Adjustment and Retraining Notification filed with the state. The employees are not part of a union.

This is today’s reality and the trend. Skilled nursing doesn't make enough money for providers. The "continuum" of care is shrinking. I am sure a major hit for those who live and those who worked there….

Susan

Residents can run polls. As a lawyer I read the contract at my CCRC and it permits residents to set up clubs and groups. I set up a Listserv system. Each building has a manager. The managers have a Listserv. We share information and ask questions. We use it to help each other. We could take a poll. Because the Listserv is on the internet, it is private and not controlled by management. At first management didn't like it because they didn't control it, but now they see the value, because it creates and fosters community. They even give us messages to pass on, because our system is fast!

Charles Nadler

Wind Crest CCRC (Erickson Senior Living)

Highlands Ranch, Colorado

We have a resident group where subscribers opt-in. They do polls to that group.

Linda Kilcrease

Resident of a CCRC