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CCRCs Versus Independent Living: Determining Your Best Over-55 Community Option

Posted by Jason Kitchel on Aug 5, 2019 9:00:34 AM

While people tend to lump all elderly care and retirement facilities together, there are several distinctions between the different living arrangements in terms of environment, services offered, and financial structure. If you are seeking a home for you or your loved one, it’s important to consider the available options and their distinctions to find the right fit.

CCRCs Versus Independent Living Determining Your Best Over 55 Community Option (1)

When it comes to long-term retirement living arrangements, two of the most common options include rental-based independent living communities and investment-based continuing care retirement communities, or CCRCs. Although from the outside these communities may appear similar, they possess several subtle differences in areas such as cost, healthcare, services and amenities. Here are a few factors to consider before making a decision about which community is the right choice for your new home.

What is a CCRC?

As the name implies, CCRCs offer a continuum of care that allows residents to age in place while receiving the assistance and services they require in each stage. As residents grow older or their health changes, they can progress from independent living to assisted living to memory care to skilled nursing all in the same location. CCRCs are occasionally referred to as life plan communities, lifetime communities, or active adult community homes. Because the anticipation is for a long duration, CCRCs have substantial upfront costs that are considered an investment into the future. When it comes to financial considerations, you are looking at two main costs:

  1. The entry fee.
    Just to take up residence at a CCRC, you are required to pay a fee that ranges from six figures up to $1 million, depending on the quality of the facility. A portion of the money can potentially be refunded if a resident leaves the facility or passes away, but it is functionally put “on hold,” as it is used for things such as capital improvements, offsetting healthcare services received by residents, and paying down debt.
  2. Monthly fees.
    Residents also pay monthly fees that range from a couple thousand dollars to $4,000 or $5,000 at more expensive facilities.

If you decide on a CCRC, consider any tax advantages that are available. For instance, you can potentially deduct a portion of your entry and monthly fees as prepaid medical expenses, especially when it comes to all-inclusive models.

One benefit of CCRCs is that, like insurance, the investment you make via the entry fee with the intention of staying several years generally locks you into a certain rate for care. That means even if the price for a private room increases in the future, you are guaranteed the rate established at the time you paid the entry fee.

What is an Independent Living Community?

Independent living communities are designed to offer residents services and amenities to help them maintain an independent and autonomous lifestyle. Many independent living communities are not licensed as assisted living providers and are not equipped to provide services for those who require skilled nursing care or higher acuity assisted living.

However, some communities may include a separate licensed assisted living facility for residents as they develop new healthcare or support needs. For instance, although Village Green is a rental-based community designed to promote and support independence, residents have the ability to transition into assisted living if additional care is needed in the future.

When it comes to cost, you won’t pay a considerable upfront entry fee to join an independent living community, only a monthly fee, which makes this option more affordable for many families. In order to get a better cost estimate, it’s important to research what amenities and services are included in the published monthly rate and which are charged as separate fees. Generally, your monthly fee will cover:

  • Campus amenities. This includes meals, scheduled transportation, programs and activities.
  • Apartment and home amenities. This includes housing, utilities, access to a full kitchen, air conditioning, weekly housekeeping, interior and exterior maintenance, and cable television.
  • Well-being services. This includes fire and life safety systems, emergency call systems, and two non-intrusive well-being checks each day.

It’s difficult to do an accurate comparison of the costs associated with CCRCs and independent living communities because they are structured differently. Also, it’s impossible to predict the future. For some people, an independent living facility is all they will require for the duration of their life, making it the less costly option. However, many residents develop more healthcare issues and needs that require a stressful and expensive move to a retirement community.

Choosing the right retirement community

Although there are similarities between various senior living communities, there are also important differences. The only way to decide if a community is the best fit for you or your loved one is to start researching specific organizations in the Federal Way area. Find one that fits into your budget, provides the services and amenities you want, and has an atmosphere to make you feel comfortable and cared for in the years to come. As a retirement community, Village Green offers independent living, assisted living, and respite care, but more importantly, it is a place served by a dedicated team that makes residents’ needs the top priority.

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Sources

“Does a Continuing Care Retirement Community (CCRC) Make Financial Sense for You?” A Place for Mom blog, Posted on 25 Jan 2019. Accessed online at https://www.aplaceformom.com/blog/does-a-continuing-care-retirement-community-make-financial-sense/

“CCRC vs. Rental Retirement Community: What Are the Differences?” Mylifesite.com. Accessed online at https://www.mylifesite.net/blog/post/ccrc-vs-rental-retirement-community-what-are-the-differences/

 

Tags: Senior Living 101