One common question we hear from people exploring life plan communities (also called continuing care retirement communities or CCRCs) is how monthly community fees change when one spouse or partner continues living independently while the other requires higher levels of care.
The answer depends on the type of residency contract the community uses. You can read more about different contract types in A Primer on CCRC Residency Contracts. Broadly speaking, the outcome typically follows one of two patterns depending on whether the contract is fee-for-service (type C) or lifecare (type A).
CCRC fee adjustments for fee-for-service (type C) contracts
With a fee-for-service (type C) contract, when one resident moves into assisted living, memory care, or nursing care and that move is considered permanent (not a short-term rehab stay), the monthly service fee for the person who remains in independent living usually decreases from the prior double-occupancy rate to a single-occupancy rate. Typical reductions are in the range of 20–30 percent. For example, if the couple’s double-occupancy fee was $5,000 per month, a 25 percent reduction would lower the remaining resident’s fee to $3,750 per month.
The partner who moves to assisted living or another care level will then pay for those services separately at the community’s prevailing market rates for that type of care.
There are a few practical points to keep in mind. If the resident receiving care has long-term care insurance, that policy may help offset the cost of services that Medicare does not cover. Medicare generally does not cover non-medical services such as personal care or assisted living; it primarily covers skilled nursing services and only for a limited period in qualifying situations. The reduction in the remaining resident’s fee can also free up funds to help pay for the partner’s care. Using the example above, the $1,250 monthly savings from moving from double to single occupancy could be applied toward the other person’s care before any additional out-of-pocket expenses are required.
CCRC fee adjustments for lifecare (type A) contracts
Under a lifecare (type A) contract, the situation is typically different. When one partner moves into assisted living or nursing care, the monthly fee for the partner who remains in independent living generally does not drop from a double-occupancy rate to a single-occupancy rate. The core benefit of a true lifecare contract is that the higher monthly fee covers both residents across different levels of care, so the person receiving care usually does not pay additional monthly charges for those services.
Because that coverage is provided up front, lifecare contracts usually carry a higher monthly cost than fee-for-service contracts. Using the same illustration as above, a lifecare double-occupancy fee might be, for example, $6,000 per month rather than $5,000, reflecting the premium paid to reduce future financial uncertainty.
Another common consideration is that many lifecare contracts do not include the cost of meals served in the healthcare center. Even though the contract may cover care services, additional charges for three daily meals in the healthcare center can add a few hundred dollars per month. Finally, if you have long-term care insurance, it may still be usable in conjunction with a lifecare contract—but coverage details vary widely. Speak with your insurance agent and a knowledgeable community representative to understand how your policy interacts with the community’s contract terms.
A note on hybrid contract fee adjustments
Some communities offer hybrid contract types, such as modified (type B) contracts or equalized-rate lifecare contracts, which do not fit neatly into the fee-for-service or lifecare descriptions above. With hybrid contracts, fee adjustments can follow different rules, so it is essential to ask the community for clear, written explanations of how monthly charges will change if one resident requires higher levels of care while the other remains in independent living.