When it comes to senior living, there are a lot of options. It’s easy to feel overwhelmed trying to understand everything from care levels to community and contract types.
What is senior living?
Before looking at the specifics of the different types of communities and contracts, it’s helpful to understand what senior living is. Senior living often gets confused with a nursing home. It’s not uncommon for the phrases to be used interchangeably even. It may be surprising to learn that a nursing home is just one of many types of senior living.
At it’s core, senior living can be any housing for those 55 or older. The 4 building blocks that make senior living what it is are:
- Care levels – how much or little help someone may need and the types of activities they may need help with.
- Community types – different options and combinations of care levels.
- Contract types – agreement with the community, and establishes what is paid (and when) and what the community provides in return.
- Lifestyle and amenities – things like maintenance, dining options, fitness centers, and events and activities
What are senior living community types?
Now that some of the basics of senior living have been covered, it’s time to take a deeper look at the types of senior living communities. When starting to try to understand senior living options, this can be one of the first challenges encountered. It can be overwhelming to sort through and decipher all the options.
There are a lot of different types of communities. They use different names and offer different levels of careand amenities. One thing is for sure, it can be easy to get confused. It can be helpful to think of the options in categories. While there are many different types of communities, they are almost always one of four main categories. These four categories can be defined broadly as independent living, nursing home, CCRC, and combination.
Independent Living
Independent living is one of the senior living care levels. It doesn’t offer medical care or support with daily activities. There are many senior living communities that only offer this type of care. They each have their own requirements, but offer residents the chance to live in a community setting as they age and typically include a number of lifestyle amenities.
This is also one of the most difficult types of communities to recognize because they often use different names. Some of the most common names independent living communities use are “senior apartments”, “active adult”, or “55+”.
The offerings available in independent living communities tend to be one of two things, villas or apartments. Villa is another broad term and typically consists of things such as single-family homes, condos, and duplexes. Apartments are frequently like any other apartment complex, just with a minimum age. With villas or apartments, the spaces can range anywhere from a small studio apartment to 3-bedroom apartment or villa or larger. Sometimes they even include things like a basement, garage, and patio or balcony.
Nursing Home
Skilled nursing facilities (SNF), frequently referred to as nursing homes, are one of the most common types of senior living communities. While independent living communities offer no care, skilled nursing facilities offer 24/7 care. At some communities, like Springfield Masonic Community and Western Reserve Masonic Community, this is referred to as a healthcare center.
With nurses and nursing assistants staffed around the clock, skilled nursing facilities can provide nearly any type of care someone may need. The care provided is typically divided into two categories – short-term rehabilitation or long-term care. Short-term rehab usually comes after a hospital stay for an injury or illness and is temporary, sometimes lasting only a couple days. In contrast, long-term care is more permanent, with the resident living in the community.
Combination
The types of communities described so far typically only offer a single level of care. However, there are many communities that offer multiple levels of care. Most communities that offer multiple levels of care can be thought of as combination communities. These communities offer 2 or 3 types or levels of care. It could be any combination, but the most common ones are:
Independent living and assisted living
Assisted living and memory care
Independent living, assisted living, and memory care
Continuing Care Retirement Community
Senior living includes five levels of care – independent living, assisted living, memory care, skilled nursing or long-term care, and short-term rehabilitation. If a community offers all five, they’re referred to as a Continuing Care Retirement Community (CCRC) or a Life Plan Community (LPC). These communities are not as common, but they can provide the best opportunity and peace of mind for the future. However, they can also be more expensive and have stricter requirements to qualify such as health or income.
With a CCRC or LPC, a resident can start in one level of care and move to a different one as their needs change. This could be things like an independent living resident who has a hip replacement temporarily moving to short-term rehab at the community or an assisted living resident moving to skilled nursing or long-term care when their needs increase.
What types of contracts does senior living have?
The types of communities are important, but they’re just one of the building blocks of senior living that’s important to understand. Senior living communities also offer different types of contracts. A contract is like a rental agreement or lease. It ensures that the resident and community both understand what is expected and offered.
There are 5 main types of contracts used in senior living. These are Type A Lifecare, Type B Modified Lifecare, Type C Fee for Service, Rental, and Equity. These sound more complicated than they are. Some of the differences with these contract types are what’s included, monthly fees, and if a lump sum, known as an entrance fee, is required before moving in.
Type A Lifecare
Like the name suggests, Type A Lifecare contracts focus on providing care for life. They’re typically found at a Continuing Care Retirement Community (CCRC) because they offer all five levels of care. With this type of contract, there is little or no difference in price, regardless of what level of care a resident needs. Compared to other contract options, lower levels of care, like independent living, may cost more but higher levels of care, like skilled nursing, may cost less. With a Type A Lifecare contract, there is also typically a large upfront entrance fee in addition to the monthly rent or fees.
Type B Modified Lifecare
For a Type B Modified Lifecare contract, each level of care does have a different cost. However, if a change in care is only needed for a brief period, such as after an illness or injury, they usually don’t change the price. Since the price increases as the care does, these contracts typically have an upfront entrance fee that is slightly less than Type A Lifecare Contracts, in addition to the varying monthly fees.
Type C Fee for Service
As the name implies, with Type C Fee for Service contracts, residents pay for care as it is needed. This contract type can be harder to budget for because the price changes. There is typically a base amount charged each month to cover basics like the apartment or villa and meals. Everything else is charged extra based on the type of care or assistance provided, number of hours provided, a combination, or something else. Each community has their own structure of fees. Some may also require a small entrance fee.
Rental
Rental contracts are the most common, but they can also be one of the easiest to understand because they’re similar to renting any other apartment or house. These contracts don’t require an upfront entrance fee, but they do frequently involve a higher monthly cost than communities that do charge an entrance fee. They also typically include care in their fees, although each level of care does usually have it’s own price and fee structure.
Equity
This is the least common type of contract used in senior living. Equity contracts are all about equity – similar to purchasing a traditional home, it’s a percentage of ownership. With this contract type, a resident purchases the home that is part of the senior living community. The resident then owns the home and has the equity of the home. Like with owning a traditional home, it is part of an estate and can be inherited.
Since residents own their homes, there are no monthly fees related to it. However, the initial purchase only covers the cost of the property and not the senior living services or amenities. Residents could be charged community fees, maintenance fees, and more. Plus, if a resident needs care, it would require additional payment.
Here to Help
There can be a lot to understand about senior living, but The Ohio Masonic Communities is here to help. We’ve created a series of guides designed to answer some of your biggest questions and help you navigate senior living. We even have an entire guide dedicated to senior living community and contract types if you want to learn more. You can see our full library of Here to Help guides and request your free copies here.
At The Ohio Masonic Communities, we want everyone to have the resources they need to navigate their journey. If you want to learn more about how senior living or the resources we have available, we’d love to hear from you. Give us a call at 1 (877) 881-1623 or contact us here. We have three senior living communities across the state of Ohio – Browning Masonic Community in Waterville, Ohio, Springfield Masonic Community in Springfield, Ohio, and Western Reserve Masonic Community in Medina, Ohio.