Guide to Evaluate Financial Viability of a CCRC

In some ways, making the decision to move to a continuing care retirement community (CCRC, also called a life plan community) is like taking out an insurance policy to protect you from the “what ifs” that the future may hold. What if I can no longer handle the upkeep of my home? What if I can no longer safely live by myself in my home? What if something happens to me and my partner is unable to provide the level of care I need or vice versa? The list goes on and on.

The continuum of care services provided by a CCRC ensure that residents will receive whatever level of care they need in the future, from a little help with household chores to full-time skilled nursing care, and everything in between. People who make the substantial financial investment that is required to move to a CCRC are assuming that the community will live up to its contractual obligations to provide these care services if and when they are needed.

But how can you be certain that a CCRC will be able to uphold their end of the bargain? At the end of the day, CCRCs are a business, after all, and just like other companies, some CCRCs are better managed than others. How can you be sure the CCRC you are considering will have the long-term financial means to provide you with the services and amenities they have promised you in the contract you sign?

Considering a CCRC’s financial viability

This question is the very reason prospective CCRC residents should inquire about a community’s financial standing and understand the CCRC’s overall long-term financial situation — what we refer to as “financial viability.”

For the average person, analyzing the financial viability of a CCRC can be difficult. Even tax and financial professionals may have trouble with this type of assessment if they are not familiar with the unique business model of CCRCs, the various types of residency contracts, and the associated actuarial impact on accounting.

This is why myLifeSite recently created a free consumer resource entitled “Guide to Evaluating the Financial Viability of a CCRC.” The purpose of this guide is to equip you to more effectively evaluate the health of a community’s finances. It should not be viewed as a way to guarantee an organization’s future viability, but rather it is designed to help you form a better view on whether the provider is taking the appropriate steps to ensure its long-term financial success.

In this free guide, we will explain topics like:

Different CCRC business structures: How a CCRC is set up as a business impacts how they will operate and pay their taxes, which in turn will impact their bottom line.
CCRC regulations: If the CCRCs on your list are in a regulated state, you may be able to glean helpful information from their state filings.
Examining a CCRC’s financial statement: Evaluating a CCRC’s financial statements helps paint a picture of the community’s current financial situation.
Other data to consider: There are other sources of information that can help you analyze the financial viability of a CCRC.

The importance of understanding a CCRC’s financial standing

Thankfully, selecting a financially sound CCRC doesn’t have to be a gamble. By understanding the key factors that contribute to a community’s fiscal health, you can rest assured that your investment is a sound one that you will be able to count on in the future. Download our free “Guide to Evaluating the Financial Viability of a CCRC.”

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