Although similar in many ways, and often confused, Continuing Care Retirement Communities and Life Care Communities are different in one significant way: One guarantees care for the life of the resident, and one guarantees care only so long as a resident has the means to continue paying.

Continuing Care Retirement Communities

Designed for adults age 60 and above, CCRCs offer their residents a "continuum" of services ranging from independent living through assisted living to skilled nursing care. Quite often specialized memory/dementia care is also included. These services are all usually, but not always, provided on one campus so that a change in the level of assistance required will not necessitate leaving the CCRC "umbrella."

Most, but not all, CCRCs require residents at the independent level of living to pay an entrance fee as well as a monthly unit rental. Entrance fees can range from a low of under $50,000 to $500,000 or more. Some, but far from all, CCRCs sell ownership in an independent living unit. If residents are permitted to purchase their units, re-sale is often restricted or strictly regulated.

Those who rent their units are often promised a return of 90% to 100% of their entrance fee either when they vacate their unit or when it is re-leased.

Continuing Care Community residents are guaranteed care within the community so long as they can pay the required fees for service, which rise with the level of care provided. Should a resident no longer be able to pay for care, the resident must to leave the community.

Life Care Communities

Life Care Communities are Continuing Care Retirement Communities that maintain endowment funds to subsidize the care of residents who have exhausted their own financial resources. Along with contributing the initial entrance fee, potential Life Care Community residents must undergo an extensive medical and financial audit before entering in order to ensure that they will be able to personally cover the cost of their care for a pre-determined length of time.

Unlike Continuing Care Communities with no financial guarantees, Life Care Communities retain ownership of their living units, which are re-leased when vacated.

With the exception of campus skilled nursing facilities that accept Medicare, neither of these forms of Continuing Care Community is regulated by the federal government. Each state has its own regulatory requirements, some stiff and some fairly loose.

Because their contracts guarantee lifetime care, Life Care Communities are subject to close financial regulation to ensure that their financial reserves remain adequate to guarantee future care commitments to all residents.

If you are considering a Continuing Care Retirement Community it is important to define whether the community you have in mind is a CCRC or a Life Care community. Because the financial investment can be very high, and the guarantees of future care are very important to have clearly defined in advance, the most important thing any potential resident can do is to have the contract thoroughly reviewed by a very competent attorney before proceeding.