Am I Healthy Enough to Move to a Life Plan Community?

One of the questions we often hear at myLifeSite relates to the types of health conditions that might preclude someone from moving into a life plan retirement community (traditionally referred to as a continuing care retirement community or “CCRC”). Indeed, a person may wait too long to make their CCRC move and then not qualify for a continuing care/life plan contract due to a decline in health or a sudden acute health event.

How a CCRC health evaluation works

If you are considering a life plan retirement community for your senior living, you may be aware that certain health requirements must be met in order to enter the community under a continuing care/life plan contract. You can learn more about the different types of CCRC residency contacts here.

Health evaluations, which are medical assessments of a person’s overall health status, are mainly used by CCRCs offering a lifecare (Type A) residency contract, and to a lesser degree those that offer a modified (Type B) contract or a fee-for-service (Type C) contract. The health evaluation process can vary from one community to another, but may involve things like:

Completing a health questionnaire
Taking a cognitive assessment
Providing recent medical records
and/or
Undergoing a short medical exam

You should know that certain common age-related health issues may not necessarily disqualify someone from moving into a CCRC, however. The intent of the evaluation is to take a holistic and actuarial view of a person’s entire health situation and determine their current ability to safely live independently, as well as their likelihood of needing long-term care down the road.

For example, it is not uncommon for older people to have certain health conditions like Parkinson’s disease, cognitive decline, osteoporosis, COPD, congestive heart failure, and/or cancer. Two people applying to move into a CCRC might have the same diagnosis (e.g., Parkinson’s or cancer), but depending on their overall health picture, age, and ability to live independently, one might be approved for a life plan contract and another might not.

Healthy residents help manage a community’s overall risk

It’s important to keep in mind why life plan communities have these health evaluations and requirements in the first place. The primary reason new residents must pass a health evaluation is that communities offering lifecare (Type A) and modified (Type B) contracts in some ways operate like quasi-insurance companies. The fees paid by healthy (i.e., independent living) residents help offset a portion of the cost for those residents who require care services (i.e., those in assisted living or the community’s skilled nursing facility).

Looking at the CCRC model from another perspective, much like an insurance policy, the healthier residents who reside in the independent living residences are essentially pre-paying for some portion of the care that they may need in the future. It’s essentially a form of health underwriting to help the CCRC manage the level of “risk” they are taking on when a new resident moves in.

For CCRCs offering fee-for-service (Type C) contracts, on the other hand, a health evaluation may not be required. This is because under a Type C contract, there is no prepayment by the resident for future care, and additionally, the community is typically not responsible for covering any of the cost of such care.

A practical look at CCRC health evaluations and qualification

At myLifeSite, we are fortunate to have former CCRC sales and marketing directors on staff who have experience going through this process with prospective residents.

Newell Bowman Dickerman, one of our customer success representatives, shared some of her experiences with the CCRC health evaluation process: “A few examples I have encountered of conditions that held a major influence on a decision about life plan contract qualification include progressed Parkinson’s disease, Alzheimer’s disease, end-stage cancers, repeated falls or multiple rehab stays within the past year, mobility limitations keeping someone from independently getting place to place, behavioral issues — like outbursts of anger or comments suggesting a risk to self or others — cognitive symptoms without a diagnosis, ALS [Lou Gehrig’s disease], and certain heart conditions.”

In general, qualification decisions are made on a case-by-case basis, looking at the total picture of an individual’s health and factoring in the individual community’s current resident mix and risk tolerance. Even within the same senior living organization, different communities might make different interpretations of someone’s health situation.

For instance, between two life plan communities, one may be stricter about the permissible health status of new residents than the other. One community may not approve anyone with a cancer diagnosis within the past five years for a life plan contract, while another would approve a prospect with a stage 1 cancer diagnosis at present.

An important caveat for couples

For couples who are considering a CCRC move, it’s important to know that there is a difference between qualifying for living independently in a community versus qualifying for a life plan contract’s care benefits, i.e., a continuing care contract or a lifecare contract. Not qualifying based on the health evaluation does not necessarily preclude a person from living at a CCRC, but it likely will impact whether they are eligible to receive the types of benefits available under a lifecare (Type A) contract, for example.

As a result, there may be an option for one spouse to qualify for contractual care benefits and the other not to qualify — but both people can live independently in the community. In this type of scenario, services and monthly fees would be the same until and unless higher levels of care are needed. Should that happen, then the “unqualified” spouse would typically pay the market rate cost for the care services they need.

Legality of CCRC health requirements and restrictions

CCRCs offer a full continuum of care including independent senior living, assisted living, and skilled nursing care, and thus they are subject to the Fair Housing Act as well as the Americans with Disabilities Act, both of which prohibit discrimination. It is crucial that CCRC administration has in-depth knowledge of and adheres to these regulations with their prospects and residents.

There has, however, been some question about whether CCRCs have legal grounds under these laws for requiring a health evaluation to determine eligibility for a life plan contract. But bear in mind that CCRCs that offer contracts with potentially discounted healthcare costs provide healthcare services (if needed) under an insurance-like arrangement. For this reason, there seems to be an actuarial justification for some type of health screening for new residents.

Shades of gray in the CCRC health assessment process

As you can see, the CCRC health evaluation and approval process is not exactly cut and dry. There are many nuances and scenarios that determine whether a prospective resident is accepted to a particular community under a particular CCRC contract type.

As explained above, there are additional scenarios that may apply in the case of a couple where one qualifies for a life plan contract based on their health evaluation, but the other does not, yet the couple will still be approved to move into the CCRC.

It thus is helpful to understand how the health evaluation process works, but do not assume that you won’t qualify to live in a CCRC just because you or your partner has a pre-existing medical condition of some type. And also keep in mind that depending on each community’s specific standards, you might not be approved for a life plan contract at one community but be approved at another.

It is also useful to bear in mind that the CCRC pre-move-in health evaluation is just one of the many ways that this specific type of retirement community helps provide its residents with peace of mind. Accurately assessing risk — in this case, the odds that a new resident will need costly care services — helps the CCRC manage its financial viability in the long term, which ultimately benefits all of its residents.

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