Over the last few years I’ve often heard the term “rogue resident” used within the continuing care retirement community (CCRC) world to describe residents perceived as demanding or having unrealistic expectations of management. Too often, these residents are labeled difficult, and that label discourages boards and management from inviting resident participation in important community discussions — which is unfortunate.
Of course some residents are harder to work with than others. People differ in temperament and communication styles. Still, the label “rogue resident” feels dismissive and demeaning. Sometimes that so-called rogue resident may actually be asking the right questions. In many CCRCs, residents bring substantial business and financial experience that can be invaluable. A persistent resident may simply be pointing out a problem management or the board has missed or chosen to ignore.
>> Related: The Voice of the Resident: Why the Senior Living Industry Should Listen
When CCRC boards go rogue
In a recent conversation with a CCRC staff member I was struck by a different possibility: what if the problem isn’t a few “rogue” residents, but a “rogue” board of directors?
The staff member described a not-for-profit community that offers a Type A (lifecare) contract where virtually all decisions about contract pricing and the financial assessment of new residents were made by the board without assistance from outside professionals. That practice raises serious concerns.
For example, the community did not engage an independent actuarial firm to validate contract pricing or to ensure appropriate reserves are set aside to meet future care obligations. Lacking objective actuarial input is a red flag for long-term financial stability.
>> Related: Evaluate the Financial Viability of a CCRC With Our Free Guide
Equally concerning, the community reportedly did not use a reliable methodology or software to qualify prospective residents financially. Proper financial qualification helps limit the community’s risk because some CCRCs offer discounted healthcare services or provide financial assistance if a resident exhausts assets while receiving care.
I did not confirm whether the community’s CFO was involved in the qualification process, but the CFO should be. A chief financial officer is accountable for all financial matters and should be engaged in assessing prospective residents’ financial viability. Conversely, volunteer board members should focus on governance and oversight rather than day-to-day financial decision-making.
When I asked whether residents were meaningfully represented on that community’s board, the staff member said there was a single resident board member — more symbolic than substantive. Without a strong resident council or an empowered resident representative, the board can lack an essential perspective.
That conversation left me deeply concerned. If a nonprofit CCRC board is making poorly informed decisions, residents and staff may be left with few options. What if the board’s choices are harming the community without the directors realizing it? What if a dominant board member or a lack of expertise prevents the board from adopting better practices?
>> Related: Look for Diversity on a CCRC’s Board of Directors
The impact on a CCRC’s financial health
If you are researching CCRCs for your retirement, ask about board and management composition, professional backgrounds and experience, board terms, and how residents are represented. These details can reveal whether a community values financial rigor, governance best practices, and resident input.
It might not be the first set of questions prospective residents think to ask, but they matter. Governance and financial oversight affect how a community is managed and its long-term viability. Moving into a CCRC is an investment in your future, so you deserve confidence in the community’s fiscal health and in the people responsible for stewarding it.