Questions to Ask

Questions to Ask at a Continuing Care Retirement Communities

Because continuing care retirement communities have many differences, considerable research and comparison should be conducted before entering into a continuing care contract. Listed below is a sample of the kinds of questions prospective residents should consider. All prospective residents should consult with legal and financial advisors before entering into a continuing care contract.

About the Community:

• Who sponsors or owns the community? Who manages the community? What is the experience and reputation of the management?
• Does the community have current and valid licenses or certifications? All California CCRCs are subject to community care licensure laws and regulations. Ask to see the most recent licensing inspection report(s).
• What are the rules and regulations of the community? Is there a resident handbook outlining non-contractual policies, i.e, modification of individual units, guest policies, pet policies, and the like?
• Is there a residents' association? What is its role? How does it function? How are its governing representatives appointed/elected?
• Is there a community outreach program? Does the provider participate in community activities? Do the residents volunteer for community activities?
• What do the residents and staff members feel about the community? What is the public perception of the community?
• Are there disclosure documents available for prospective residents to review regarding residents' rights, the provider's financial status, or disaster preparedness plan?

About Continuing Care Contracts:

• What types of contracts are available? The continuing care contract is a legal agreement between you (the consumer) and a continuing care provider. This agreement generally secures living accommodations and services, including health care services, over the long term.
• What types of services, accommodations and levels of care are offered? Is the level of services clearly defined? What is included in the monthly fee? What costs extra?
• What adjustment, if any, will be made to the monthly service fee if a resident is transferred to other accommodations, such as assisted living or nursing care, within or outside the community?
• Does the contract clearly state whether there will be any refunds of entrance fees? Are refunds made when the contract is terminated or is the repayment contingent upon another event?
• To what extent can the CCRC increase fees or add on additional fees? What happens if the fee increases are greater than the resident's ability to pay? Are there any financial aid programs for residents if they become unable to pay the monthly service fees?
• Are there any tax considerations residents should be aware of?
• Are grounds for terminating the contract and procedures for doing so stated clearly? What recourse do residents have if there is a disagreement?

About Health Care:

• What specific health care services are included in the contract?
• Are assisted living and nursing services available on the community campus or somewhere else?
• If the community is new and has not yet developed health care facilities, what accommodations will be made to provide these services until the health care facilities are in place?
• What other medical services are available nearby?
• What are the payment procedures for higher levels of care?

About the Provider's Financial Status:

• What is the provider's future service obligation? Are there adequate reserves?
• How much long term debt is carried? Is the provider current with its loan payments?
• Does the community maintain a positive cash flow, or if it is a new community, is a positive cash flow projected?
• What are the provider's investment philosophies? What types of investments are presently being carried? Who manages the investments?
• What are the asset replacement policies? What is the source of funding for asset replacement? - through entrance fees? - through investments? Is there a regular plan for replacement or modernization of assets?
• Does the provider have an endowment fund? What is the funding level? Are there any donor restrictions? Are there any board designated restrictions or uses?
• Does the provider have a financial development program, such as gift annuity, charitable remainder of trust, bequests, other planned giving methods?
• What is the risk management policy of the provider? Is there adequate protection through asset and liability insurance. What is the basis for asset valuation?
• If the Community depends on non-operating income, does the funding source have a strong history? Will this source continue to generate income?
• Does the community have a history of a strong occupancy rate at all levels of care?