The 1818 Society: RALC-Committee – Continuing Care Retirement Communities, September 2004
The 1818 Society
CONTINUING CARE RETIREMENT COMMUNITIES (CCRCs)
AN OVERVIEW OF FIVE CCRCs IN THE WASHINGTON DC AREA
PREPARED FOR THE USE OF WORLD BANK GROUP RETIREES
September 2004
Prepared & Distributed by:
The Retirement & Assisted Living Committee (RALC)
The 1818 Society
PO Box 27388
Washington DC 20038
Phone: 202 458 1956
Fax: 202 522 2417
Email:
CONTINUING CARE RETIREMENT COMMUNITIES (CCRCs)
AN OVERVIEW OF FIVE CCRCs IN THE WASHINGTON DC AREA
I. INTRODUCTION 3
II. overview of the 5 ccrcs 5
III. Important Definitions 9
1. CONTRACT TYPES 9
A. EXTENSIVE AGREEMENTS 9
B. MODIFIED AGREEMENTS 9
C. FEE-FOR-SERVICE AGREEMENTS 9
2. PAYMENT OPTIONS 9
A. ENTRY FEE AND MONTHLY FEE PAYMENTS 10
B. MONTHLY FEE ONLY OR RENTAL PAYMENTS 10
C. OWNERSHIP OR EQUITY PAYMENTS 10
3. TYPES OF FEES AND REFUNDABILITY 10
A. ENTRY FEES 10
B. MONTHLY FEES 11
4. OWNERSHIP OR EQUITY IN A CCRC: 12
IV. FINDINGS 13
ANNEXES 15
1. COLLINGTON 15
2. HERON POINT 19
3. INGLESIDE AT ROCK CREEK 23
4. MAPLEWOOD 29
5. THE FOUNTAINS AT WASHINGTON HOUSE 33
6. Blank Questionnaire for CCRC 37
7. QUESTIONS TO SUPPLEMENT ANALYSIS OF CCRCs 41
8. CONTACTS AND ADDITIONAL INFORMATION FOR CCRCs 42
This report has been prepared by Sandra Hadler for the Retirement & Assisted Living Committee of The 1818 Society
GLOSSARY
AAHSA………………American Association of Homes & Services for the Aging
AARP………………...American Association of Retired Persons
AL……………………Assisted Living
CCAC………………..Continuing Care Accreditation Commission
CCRC………………...Continuing Care Retirement Community
IL……………………..Independent Living
LTC…………………..Long-term Care Insurance
NAIC…………………National Association of Insurance Commissioners
NC……………………Nursing Care
RALC…………………Retirement & Assisted Living Committee
Disclaimer
This report has been prepared for the exclusive, personal use of members of The 1818 Society. It is intended to assist in sharing information on Continuing Care Retirement Communities in the Washington DC area. The information contained in the Annexes on the facilities visited has been shared with each of the facilities. Neither they nor The 1818 Society bear responsibility for the information provided in the report. Information contained in this report is subject to change.
AN OVERVIEW OF FIVE CCRCs IN THE WASHINGTON DC AREA
I. INTRODUCTION
The Retirement and Assisted Living Sub-Committee (RALC) of The 1818 Society was established in October 2003 to assist members with a factual assessment of phased living options during retirement. In April 2004 a well-attended panel discussion was held for members, with six Bank retirees presenting the decisions and processes they had undertaken to ensure their well-being and that of their families. One outcome of the panel was the realization that these decisions are extremely complex – emotionally, legally and financially – and that their early consideration is essential. It was also apparent that few of us knew much about the decisions or options involved in moving towards the all-encompassing but costly Continuing Care Retirement Community (CCRC) path. A decision was made therefore to look more closely into the CCRC option and, in the process, to visit five communities in the Washington area. These were selected on the basis of the personal recommendation of The 1818 Society members, location (DC, Maryland and Virginia) to reflect the location of The 1818 members, and most importantly, the diverse options offered by the five CCRCs.[1]
The objective of the report is not to provide advice - only to provide a source of objective, factual information that the Committee hopes will be useful to members. The next step is for each of us, with our spouses and families, to take actions appropriate for our life style.
Having completed this exercise, our main recommendations are:
· for all of us, early on, to visit some facilities and begin to think through the process. Most facilities take residents from age 60-65, but the average age on entry is closer to 75- 80 – by which time, we may not be able to enjoy fully what these communities have to offer; and,
· to consider carefully the health, financial, legal and estate implications for ourselves, our spouses and our families.
Before reviewing the CCRCs, it is useful to note that the 2002 assumptions adopted by the Pension Fund for the Bank Group retirees put life expectancy for a male retiring at age 60 at 86.3 years and 90.5 for a female; the percentage expected to survive to age 100, was 10.1 percent for males and 19.9 percent for females. And, according to the National Association of Insurance Providers (NAIC) approximately 44% of people reaching age 65 are expected to need nursing care at least once in their lifetime and, of those needing nursing care, about 53% will stay for one year or more.
The report briefly reviews the nature of CCRCs, summarizes the key features of the five CCRCs visited and provides some necessary detail on terminology. Our findings are summarized in Section IV below. Annexes 1-5 present summaries of the CCRCs visited. Annex 6 provides a blank copy of the CCRC questionnaire we developed. Members visiting a CCRC may find the questionnaire useful for themselves, but we would also ask that, if you do visit an additional CCRC, please send us a copy of your completed questionnaire that we can add to our files. Annex 7 provides some additional questions for your consideration, and Annex 8 provides some useful additional institutional sources, contact names, websites and reading.
Details on the CCRCs visited and some information on LTC insurance policies is on file in The 1818 Society offices.
This report formed the basis for a Panel Discussion on the CCRC retirement living option, sponsored by the RALC Committee of The 1818 Society on September 14, 2004 in Washington DC. A Keynote speaker, Mr. Keesey Hayward of the Senior Hospitality International was invited together with Representatives from each of the five facilities. This event also provided an opportunity for members to discuss issues with representatives and obtain information.
By virtue of the global nature of The 1818 Society’s constituent members, any information readers may have on international CCRCs or similar communities overseas would be welcome. In particular, the Committee would welcome hearing from any member who would be willing to talk at a future event about such communities outside of the USA.
II. overview of the 5 ccrcs
The five CCRCs selected are:
· Collington – semi-rural setting in Prince George’s county, but on Metro line; non-profit.
· Heron Point – rural setting on Eastern Shore along the banks of the Chester River; non-profit.
· Ingleside at Rock Creek – on edge of Rock Creek Park in DC; non-profit.
· Maplewood – wooded setting within Beltway on Old Georgetown Road; cooperative.
· The Fountains at Washington House – in suburbs of Alexandria; for profit.
The Summary Table, which follows page 6, provides a summary of important features for a prospective resident of the five facilities. The communities visited cover a wide range of characteristics:
· locations are urban, rural or suburban;
· non-profit and for-profit;
· full ‘lifecare’, modified and fee-for-service;
· non-refundable, rented or equity ownership;
· housing offered ranges from studios to 3-bedroom, 2-car garage cottages – and the smallest and the largest are invariably the units in greatest demand.
All five CCRCs visited provide a full range of health care and two have significant ‘memory care’ facilities – the latter appears to be the fastest growing segment of the industry. All facilities provide a wide-range of amenities, but also appear to aim at a particular market segment of the elder population: one community, that we did not review, provides champagne at 4 o’clock – daily. Many CCRCs are affiliated with a particular church, but accept residents of all creeds. The CCRCs visited are in the Washington DC area, and as such may be more expensive than communities elsewhere in the USA.
Stepping back, what is a CCRC? Many older adults find a campus-type retirement community that offers several levels of care and services very attractive. A CCRC is one type of community that offers a continuum of care: part housing complex, part activity center and part health care system. It is not an ‘old folks’ home, a nursing home, a hospital or simply a complex for retirees, but rather a mixed-use community. It differs from other retirement options by the provision of a continuum of housing services and health care, located and administered on-site. The services are coordinated by a team of health professionals. A written agreement between the resident(s) and CCRC is signed and is intended to last the resident’s lifetime. Emphasis is placed on quality of services and lifestyle, and provides the benefit of remaining in a familiar, chosen location.
From the Summary Table below it is quickly apparent that CCRCs are an expensive life option, and that cost and timing of entry will be major decisions in the selection process for 1818 Society members, over and above general healthcare and environment considerations. Information on past cost trends is difficult to obtain, but a comparison of current rates with those contained in recent issues of Retirement Living magazine suggests that trends in entry
fees in this area are more in line with real estate trends than with inflation indicators. Monthly fee increases appear to be averaging twice the leading inflation indicators. With Bank pensions increasing in recent years at 1.5% pa, retirement options that are feasible financially now, may not be 10 or 20 years down the road, when movement into a subsequent phase of living, including CCRCs, becomes a pressing concern. Entry and monthly fees may be tax deductible, depending on the extent of facility operating costs that are medical expenses (See Section III).
Beyond financial considerations, however, it is important to realize that individual CCRCs defy comparison. The deciding factor for a member will be inevitably the chemistry between a facility and the individual, within their feasible financial envelope at that time, while remembering that this is a highly competitive industry, whether a facility is for profit or non-profit.
Although this exercise considers five CCRCs, within the greater Washington DC area there are some 50 CCRCs, in addition to similar numbers of ‘active adult’ communities, independent communities, and various types of assisted living and nursing care communities from which to make a choice. Across the United States, CCRCs alone can be classified by some 30 different types of retirement needs. Besides active-adult CCRCs, such as those with golfing or waterfront locations, there are more than 20 care categories to choose from, including acute-care (hospital-like) places and behavioral/psychiatric communities. Major groupings are under the headings of Active Retirement, Extended Care, Golf Communities, RV Lifestyles and Rental Communities. Increasingly, CCRC-type communities are being established internationally, and particularly in Canada, Mexico and the United Kingdom.
To help in decision-making, two organizations provide ‘seals of approval’ of CCRCs – The Continuing Care Accreditation Commission (CCAC) and the Senior Hospitality Institute.
CCAC is an accreditation that goes above and beyond Government financial and health regulations for CCRCs. It is costly (approximately $10,000 pa) and once obtained lasts for 5 years. For a relatively small facility, this appears to be an important ‘seal of approval’. Non-profits with a strong reputation (for example, Maplewood) do not feel it is necessary, and larger for-profits apparently believe that their standards and reputation are sufficient.
Since 1995, the Senior Hospitality Intstitute has been helping Seniors identify
outstanding communities for active retirement living – known as ‘Retirement Resorts’. It does for the senior hospitality industry what other organizations do for hotels and restaurants with 5-diamond and 5-star rating systems. To qualify as a Retirement Resort, communities must have exceptional facilities and staff, and must offer a wide variety of recreational, educational, cultural, spiritual and social opportunities in addition to quality healthcare services. Each community is evaluated yearly through an on-site visit and resident interviews.
With thousands of retirement communities worldwide vying for clients - and their money - learning about them and choosing among them is an overwhelming task. The knowledge gap is being filled by websites that categorize and rate retirement communities on the basis of client needs or interests. Several of these are listed in Annex 8. Most of the websites offer a brief description of a community and the types of services available, with a click-on link to the company's site. Seniors who have no computer access at home or among friends can ask the local library for online assistance. Reference librarians will often help to download and print information.
Additionally, to help in the selection process there are now numerous consulting services that for a fee will assist in the selection process by matching finances and location by state or country. A few of these are included in Annex 8.
However, before proceeding further, it is important to understand key terminology in order to be able to assess a facility. Section III below provides a summary of key concepts and their definition. This Section might best be read before or in conjunction with the Summary Table that follows page 6.
III. Important Definitions
1. CONTRACT TYPES
A. EXTENSIVE AGREEMENTS
An extensive agreement (lifecare) includes housing, residential services, amenities and unlimited, specific health-related services in Assisted Living (AL) and Nursing Care (NC), with little or no substantial increase in periodic (monthly) payments, except for normal operating costs and inflation adjustments. Extensive agreements provide for the prepayment of medical expenses, similar to an insurance arrangement, and are sometimes known as ‘lifecare’ agreements. While an extensive agreement generally requires a higher monthly fee than other types of agreements in the early years of residence in the CCRC, it allows you to plan for future, unexpected health care expenditures with a steady stream of monthly fee payments. In essence, you pay for tomorrow’s medical expenditures with today’s dollar. It is important to note that the term ‘lifecare’ is used differently by different facilities. Facilities offering an extensive lifecare contract will likely require both a financial and medical examination prior to acceptance.
B. MODIFIED AGREEMENTS
A modified agreement includes housing, residential services, amenities, and a specific amount of long-term nursing care with no substantial increase in periodic (monthly) payments. For example, you may receive 30 days of long-term nursing care per year without increased charges. After that period, you pay the standard daily market rate, or you may pay a discounted daily rate for all nursing care. Some communities offering a modified contract increase the monthly payments when assisted living or nursing is required, but at a rate that is less than you would pay if you were not covered by a continuing care resident agreement.