Page 1 Page 2 Page 3 Page 4When selecting a contract option, seniors must determine how much pre-paid health care they will desire in the future, how much risk they would like to assume, and their long-term financial plans. Regardless of the contract type chosen, monthly fees rise to match inflation rates. This is typically done on an annual basis; however, individuals who remain in their family homes instead of moving to a CCRC also assume these inflationary pressures when paying regular monthly bills. 1) Life Care Contract orTypeA Contract A life care contract is a means of managing risk for both the community and the resident. In other words, when a community offers a full life care contract, the community assumes most of the risk while the resident assumes very little. A life care contract pays for long-term care for the resident’s lifetime, regardless of the amount or duration of care. While a resident’s entry fee may be higher for a life care contract, life care assures that monthly costs will remain a constant. Residents may receive health care in the community’s assisted living or skilled nursing facilities, and the monthly rate doesn’t increase from the cost of independent living (aside from possible costs for additional meals and incidentals). It is the most secure long-term care insurance policy available. 2)Type B Contract A Type B contract offers particular health care services for a specified amount of time for a lower entry fee than a life care option. However, after the stated health care resources have been utilized, the resident begins to pay for services as needed, often at a preferential rate compared to the general public. With a Type B contract, the resident assumes more risk than with a life care contract option, but pays a lower initial cost. Essentially, people who choose this type of contract are insuring less of their potential long-term care. 3) Fee-for-Service Contract orType C Contract A fee-for-service contract charges the lowest entry fee; however, the resident assumes full responsibility for the cost of health care provided by the community. The entrance fee and monthly fee cover the cost of living at the community and many additional amenities, but the resident accepts full risk and pays for long-term health care services as needed. Tax Benefits Depending on which contract option you choose, you should also be aware that the federal government sometimes considers the costs associated with your entrance fee and monthly fee to be tax-deductible (in particular, with life care contracts). Be sure to ask the community you are working with if this added benefit applies to their contract. Services, Features and Amenities Today’s CCRCs provide resort- style living with a wide array of services, features and amenities that are covered by residents’ monthly fees. For example, maintenance personnel are available to complete home maintenance projects, landscape the campus, clear walkways of snow during winter months and complete any other task you request. CCRCs also host social and educational events, and provide transportation to and from local and cultural attractions. Many campuses provide amenities like heated pools, gyms and wellness centers for no additional charge. ~3~