Guides

What the terms in a continuing care contract mean, and where to find them in a filing.

• Type A, B and C contracts: what each means for the cost of care later

  The contract type decides what you pay if you later need assisted living or nursing: about the same monthly fee (A), some included or discounted care (B), or market rates (C).

• How CCRC entrance-fee refunds work, and when the money is paid

  Refund plans set what is kept on move-in, how fast the refund declines and its floor. Check when it is paid: often only after your unit is re-occupied.

• Reading a CCRC's finances: days cash, debt coverage and covenants

  Days cash on hand and debt service coverage are the measures lenders watch; compare them with its own lenders' minimums and the industry median, and watch the trend.

• When a CCRC goes bankrupt: what happened to residents' entrance fees

  In a CCRC bankruptcy, bondholders and mortgage lenders are paid before residents' refunds. One family expected to recover about $18,000 of a $145,000 refundable fee.

• How to read a CCRC disclosure statement

  Fees are usually in an exhibit near the end, binding refund terms in the residency agreement appendix, and the finances in the audited statements.

• Questions to ask a CCRC, and where the filing answers each one

  Ask about contract type, refunds and when they are paid, fee history, care costs later and finances, then check each answer in the disclosure statement.