I thought I knew a lot about retirement planning, but I learned even more after living in a Continuing Care Retirement Community (CCRC) for the past two years. I did that because my 90-year old mom was living with me and I just couldn’t keep up with her ever-increasing care needs. She wouldn’t go on her own, so we both went. I live in a 2200 square foot cottage and mom lived in all levels of care until she passed away in July 2025.
Let me preface this by saying this is my experience at a CCRC. I’ve been very pleased with the quality of care and the character of management. Nothing is perfect, but I live near great medical care, wonderful neighbors, a community of support and professionals who know their fields of expertise. All of this may vary depending on the CCRC. All the more reason to investigate on behalf of your clients.
When we came to our CCRC, we both had to pass cognitive, physical and financial tests. We were both fit for independent living which is where most people want to start their experience. Don’t wait too long to apply. You don’t want a health issue to bar entry. It’s not uncommon to have several years on a wait list before the style of unit you desire opens up.
Independent living means just that: that you can get around the community on your own. You can go to meals when you choose to, go to programs and concerts that intrigue you or join many of the activities open to all.
Many people choose to hire a caregiver at any level of care (Independent, Assisted, or Skilled), but here you have to get permission to do that if you want to preserve the benevolence option. If you draw down your own money paying caregivers, then the community might not keep you on if you run out of money. Again, the rules vary for each retirement community. Make sure you read the contracts for each level of care and understand the nuances. You’ll be a much better informed advisor.
I applaud all efforts to stay independent as long as possible, but even at age 90 it was a battle to try to convince my mom it was time for some help. We started off with just a few hours a week with caregivers for some of the physically difficult “activities of daily living” (ADLs) but within six months we needed 24-hour care. A few hours a week was easily approved but by the time we got to 24-hour care, it was time to move to Assisted Living.
I needed help navigating all the health issues I encountered with my mother and hired a health advocate. She was tremendously helpful and had worked in the elder care industry for 20 years and started her own consulting agency. I originally hired her for myself in case something happened to me and I needed an advocate. But I hired her again when my mom needed more care. She helped me decide between private and agency caregivers, interviewed candidates with us, introduced the caregivers to the facility and us, helped when something happened to a caregiver and we needed a replacement. As an advisor, you should get to know the people who offer this service to be able to recommend them to clients.
Let me say this: caregivers can be expensive. A few hours a week can be manageable, but when you get to 24-hour care, it’s expensive. Your long-term care policy may not pay for it if you don’t pass the hours necessary for “activities of daily living (ADRs).” Those include transporting (walking, getting into cars or beds), eating, toileting, dressing and bathing. And be prepared to pay the full cost for a couple months as your long-term care (LTC) elimination period counts down. By the time mom’s waiting period was up, she had no choice but to move to assisted living. So we paid for caregivers in independent living from her assets for the first three months.
We had our first call with the long-term care insurance people and I was nervous if we would quality at first. Mom had some of these ADL issues, but she also needed help with non-ADL tasks. She ordered a lot from Amazon and needed help opening boxes. She had trouble reaching the clothes on the top rack in her closet. Within a few months of hiring a caregiver, she had trouble with all the ADLs. Things can change quickly.
One of the things that happened in our situation was increasing frequency in calls to me that mom wasn’t feeling well from the caregivers and should we call 911? The hospital was five minutes away, but there is no doctor in residence in Independent Living and the one nurse has limited hours. I needed to talk to mom and help decide what to do (often in the middle of the night). The advantage is that by calling 911, the ambulance got priority at the Emergency Room (ER). Mom got right in and if we were lucky she got a more private area. Many times though we were in the halls as the hospital triaged an overflow of emergency patients. The days waiting in the ER often stretched to 15 or more hours sitting on uncomfortable chairs. (Bring a cushion.)
One of those times in the ER resulted in the need for emergency surgery when mom was age 92. There really wasn’t a choice so we did it and she survived. But then we had to decide where she would recover. We chose the Skilled Nursing back at the retirement community. After a two week stay, she went back to her independent living apartment. But the need for caregivers rocketed up. We started with 24-hour care after Skilled Nursing and decreased it as she got stronger. But a couple months later, she was back in the hospital and after another stay in skilled nursing, the facility said she needed to be in Assisted Living.
Make sure you understand the rules of transitioning within independent care too. Some residents start out in cottages and then, for example, after a medical issue, want to live in an apartment that is closer to most of the activities and services. You would think they’d have preference over someone coming in from the outside, but that’s not necessarily the case. For example, if the resident moving out of the unit had a refund (90% back, 50% back), a current resident couldn’t move in that unit. Someone from the outside needed to move there based on how the CCRC operated financially. Make sure you understand these nuances in the transferring rules. And understand exactly how much that lateral move is going to cost. It may be quite a bit more than you expected.
If you want to understand the current residents’ concerns, ask the marketing people if you can meet with some members of the Resident Advisory Committee (RAC). This is the group that is actively dealing with issues within the community. You’ll probably hear a much different perspective from the marketing group. Not to say the marketing people are doing anything other than a great job, but they go home at night. The residents are there 24/7.
One of my fears was that there wouldn’t be a bed available when mom needed one. Being on the finance committee, I could see occupancy rates for each level of care. There were about 400 independent living units, 30 assisted living apartments and 50 skilled nursing beds. Most were near 100% occupancy. Good for profitability of the CCRC. Concerning if you need a bed and they are full. When you are investigating a CCRC for a client, ask about number of beds per level of care and occupancy rates.
We were in luck. An apartment was available right when we needed it and we grabbed it. While on the finance committee, I asked what happens if no apartment is available in the level of care you need next. They suggested a sister community 20 miles away, but that would not have worked for us. I moved to the CCRC to be close by in times of emergency.
Then we started the task of moving her for the second time in less than two years. Luckily I have a brother and we shared the work of packing up all her stuff again and then unpacking once the move was made.
About a week before mom moved to Assisted Living, her blood oxygen levels started dropping. She needed oxygen. In skilled nursing, the staff arranged for the oxygen tanks to be delivered and it was billed to Medicare. On her first day in Assisted Living, I was told now I needed to do arrange for oxygen. Obviously that’s not in my bag of skills, so after a bunch of calls the social worker for Assisted Living helped get that arranged. Make sure you know who the social workers are for each level of care. They get things done.
For Medicare to cover the cost of oxygen in Assisted Living, mom needed a “diagnosis” from a specialist. She hadn’t needed specialists before this point, so I quickly tried to find the appropriate doctor, but none of them had appointments for new patients for months. If she had seen a specialist in the hospital, they would have taken her right away. But that didn’t happen. So we took the first available appointment many months away and went on a waiting list for any available cancellations. You might consider finding specialists like cardiologists, neurologists, pulmonologists before an emergency strikes. Mom was healthy as a horse before all of this started at age 92. But I’m lining up these specialists for myself now.
I thought that when mom moved to Assisted Living, the need for an additional caregiver would be over. In our Assisted Living level, if you needed more than one person to assist with ADLs (typically a certified nursing assistant (CNA)), then you could get “kicked out” of Assisted Living and either referred out of the community altogether or sent to the Skilled Nursing level. Or you might be able to hire a caregiver. Assisted Living may be more“independent” than you thought.
You may or may not have the option to hire a caregiver yourself. In our case, after a second hospital stay, the management of Assisted Living decided that mom needed more than one person to help with ADLs, so she had to move to Skilled Nursing. We weren’t given the option to hire a caregiver given her health outlook. There was some possibility that if she got better she could come back to Assisted Living, but that never happened.
If we had hired an additional caregiver, our LTC daily maximum benefit wouldn’t have been enough coverage for both the caregiver and the cost of Assisted Living (or Skilled Nursing). So watch out for that daily maximum when you’re planning for these costs in the final years. Also pay attention to the number of years that your policy pays out and if you have “spousal” benefits. Some policies were sold so that if one spouse didn’t use all their benefits, the other spouse might have a couple additional years of care. That matters if you’ve got an Alzheimer’s diagnosis.
In Skilled Nursing, there is more hands-on nursing. More nurses. More CNAs. More access to Physical Therapy (PT) and OccupationalTherapy (OT). Eventually mom came to appreciate what these professionals did for her mobility. We moved clothes and other items that made her new room feel more “homey,” but life was very different in Skilled Nursing. For one thing, the residents around you can be much sicker. Many nights you could hear people moaning and that was very disconcerting for everybody. And you no longer have an apartment, you essentially have a hospital room.
Within a few months in our situation, our primary physician (who did not have visiting privileges to the community)recommended we get hospice involved. We did our research, chose a firm and set that up. Mom was on hospice two days before she passed away. I’ll say this: She was ready to go. It was quick at the very end. She was not in pain. She was at peace.
I’m an intelligent, financially savvy advisor, but boy did Iget an education when it comes to understanding who pays for what and when. I thought if we had good long-term care insurance, we would be set. Here’s what I learned:
When we started using the Skilled Nursing level of care, I first heard the term “episodic health days.” In the Independent Living contract, we got a certain number of days in Skilled Nursing that were “free” because you were already paying your Independent fees and the stay was temporary. Those days didn’t kick in until you used up what Medicare would pay for (up to 100 days after a hospital stay). If you moved back to Independent Living and stayed out of Skilled Nursing for 30 days, those health days reset and you got another 60 days covered. Once you moved into Assisted Living, you no longer had health days. That’s a different contract.
Medicare
CCRCs and Nursing Homes are going to be well-versed in what Medicare will pay for—both in days covered by skilled nursing and for physical therapy. They will let you know when you are about to be “dropped” by Medicare once your approved days are used up. There are further distinctions about what Medicare A pays for and Medicare B. The CCRC files claims and deals with that paperwork.
Long-Term Care Insurance
I bought mom a great policy at least twenty years ago through the AICPA when benefits were still plentiful. She had great coverage. The issues for us were the elimination period and the maximum daily benefit. Mom was only really sick for ten months. The first three of those weren’t covered, even though she had been approved for benefits, because of the elimination period. But then the coverage kicked in and paid for her care. If we had hired a caregiver on top of Assisted Living costs, it wouldn’t have covered that total daily amount because of the daily maximum. Even so, I’m very glad I had this LTC coverage. I watched my grandmother get “wiped out” financially with LTC costs and you never know exactly what is going to happen.
There are some interesting tax aspects of living in a CCRC that I didn’t fully appreciate. I knew that some portion of the entrance fee and the monthly fees were deductible as a medical expense, but I didn’t build them into my retirement plan and tax projection for the year I entered the facility. I also figured that I wouldn’t get over the 7.5% threshold for medical on itemized deductions. I was wrong. I now track all out-of-pocket pharmacy costs, co-pays, eligible insurance premiums and other medical deductions.
I also rethought how to use my Health Savings Account (HSA) in retirement. We all know that these accounts can be valuable especially if you are delaying Social Security benefits and can use this money to cover medical expenses in the intervening years.
But medical deductions might be even more valuable if you itemize, especially if you can deduct hefty CCRC fees. If you use your HSA account to cover medical costs, you can’t deduct those costs. In my case, the deduction was more valuable at this point than drawing down the HSA. That may change over time if I choose to use those assets before I die and they become fully taxable to someone else (a non-spouse beneficiary).
In 2025 there was significant legislation that changed how you could apply for Social Security benefits (the Social Security Fairness Act). Because mom was a teacher, she initially couldn’t apply for my father’s benefits when he died at age 50. As a teacher receiving a pension, she wasn’t eligible for benefits under his record. She received about $50 a month until we went to the Social Security office last year and applied under his record. After that, she got several thousand dollars in “back pay” and her benefit jumped up to about $2000 a month. She didn’t even live a full year to collect those benefits, but every little bit helped in paying for those three months of elimination period for her long-term care benefits.
You probably know this already, but there needs to be preparation for what happens if cognitive decline happens long before death occurs. I’ve had two aunts in this situation. They were in their 70s or early 80s when a loved one had to make the call to have them enter memory care, or move into a CCRC that has levels of care as you need them. You may also want to think through what would happen in your own situation if this happens to you. Do you have the appropriate protections in place for someone you trust to take over your financial matters? You want to give yourself plenty of time to build trust and share information.
There are more considerations in aging when someone doesn’t have a spouse or kids or close relatives or even friends that could step into the roles they may need. A Health Advocate may play an important role in these situations. Think through a disability scenario with your single clients to make sure that contingency is covered. If they had a stroke or debilitating heart attack, where would they live? Who would drive them to doctor appointments? Could they stay in independent housing with a caregiver if they chose to? Who would manage the caregiver? What would happen to pets that bring essential emotional support? Your solo agers will thank you for being proactive.
Agreeing to be a Power of Attorney (POA) sounds straightforward enough initially. Ask your clients who they are POAs for. A medical POA not only may make life and death decisions, but it may also involve getting that person to doctor’s appointments (and that can be almost weekly with the elderly). Or making arrangements for oxygen or caregivers or going with them to procedures they are worried they won’t survive.
Another nudge I’d give you and your clients is thinking about legacy—especially who gets what within the family. If possible, explore clients giving those things away during life if they don’t bring comfort currently. Clients may need to update appraisals on more valuable items. All of that takes time and it’s very easy to procrastinate.
I now build “who gets what” into my Net Worth Statement along with the flow of assets to charities and people I’ve named in my documents. It can be an eye opener when you see how the percentages from the estate documents translate into dollars. How much can a charity comfortably absorb and manage? I’ve seen situations where the dollars are so large that the charity board does nothing but bicker over how to spend the money. You may want to encourage clients to talk to the charities ahead of time and ask how they would handle a much larger bequest. How would it be invested? How would they choose to use it?
One more word on giving to charity during life through a Qualified Charitable Distribution from an IRA. At my retirement community we have a charitable foundation that is associated through the parent organization. What is not obvious is that it is a “supporting organization.” You may remember you can’t make QCDs to a Donor Advised Fund (DAF), but that’s also true of supporting organizations. Even if the organization is a 501c3, check to see if it is also a supporting organization. If so, make sure the client uses another method to make gifts to that organization.
While I understood the tax rules and complexities of retirement planning, living in a retirement community has given me on the ground training in the nuances that can play an important role in helping your clients or your own family. This just represents my own specific situation, butI hope it helps as you think through your own clients and family situations.
