Finally, increased standards are being considered for retirement homes. Today, said the Wall Street Journal, a Senate committee is holding a hearing to discuss the issues rife in <"http://www.yourlawyer.com/practice_areas/nursing_home_negligence">continuing-care retirement communities (CCRCs).
CCRCs are known for high up-front charges and ongoing monthly charges for lifetime senior care, said the Journal. Meanwhile, today, the Government Accountability Office (GAO) is releasing a report asking state regulators to increase oversight of CCRCs.
CCRCs encompass a variety of care options that can include anything from â€œindependent-living apartments to skilled nursing facilities,â€ said the Journal. All of the options, noted the Journal, enable the senior community to “age in place,” but generally come with largeâ€”typically six-figureâ€”fees that go toward construction at the site. Sometimes fees are refundable to heirs following death and unit reoccupation.
Religious and fraternal organizations are best known for operating these types of facilities in which seniors pass over homes and assets, said the Journal, citing the GAO. This type of facility has seen increases and decreases in demand based on economic climates and now, given the downturn, advocates and politicians are concerned that seniors living in CCRC facilities might not be adequately protected, reported the Journal.
While the GAO will not make recommendations, it does urge state regulators to ensure senior residents are appropriately protected when CCRCs experience financial upset, wrote the Journal. Among issues noted, are unplanned monthly fee increases and loss of refundable entrance fees; shifting regulations across states; lacking regulations in someâ€”12â€”states; and the â€œlong-term viabilityâ€ of these facilities, said the Journal
A national bill of rights is being considered and the senior community conducted its own investigation with results due today. Industry agrees that increased transparency is called for but is concerned that too much information might detract investor dollars. A couple of CCRCs in Chicago have filed for bankruptcy, with dozens more defaulting on $676 million in municipal-bond debt in the past year, noted the Journal. Today, the focus is expected to be on the bankruptcy of Covenant at South Hills, a CCRC near Pittsburgh, said the Journal. About 120 residents lost $26 million in refundable entrance deposits due to that community’s 2009 bankruptcy.
USNews said that these concerns led the Senate Special Committee on Aging to ask the GAO for the CCRC industry study, noting that the Committee’s Democrat staff also developed its own report based on an investigation of five unidentified CCRC companies. CCRCs typically target healthy seniors in their 70s and 80s, with residents expected to live out their lives at the facilities. CCRCs are regulated at the state level; however, the GAO report referred to an industry study that revealed only 38 follow separate CCRC regulations; of those, there are significant oversight differences, said the GAO, according to USNews.
“The CCRC model is particularly vulnerable during economic downturns, as stagnant real estate markets drive down occupancy levels in independent living units, which serve as CCRCsâ€™ primary source of profit,” the Committee report said, quoted USNews. “Financial difficulties for CCRC providers could place a consumerâ€™s investment at risk and raise their monthly CCRC expenditures. In addition, according to the American Bankruptcy Institute Journal, ‘the CCRC industry is particularly vulnerable to insolvency, and several CCRCs have failed, primarily as a result of poor financial planning,â€™â€ the GAO added.