Learn more about the different types of senior living contracts, what they typically include, and further tips on how to review each residency agreement. Learn more about the different types of senior living contracts, what they typically include, and further tips on how to review each residency agreement.
From independent and assisted living to skilled nursing and memory care, distinct types of senior living communities have different financial and admission agreements. And understanding your community’s resident agreement can be as important as getting a referral, taking a tour, talking with other residents, or sampling the food in the dining room. So, before signing on the dotted line it’s vital to fully understand what you’re signing.
Our Consumer’s Guide to Senior Living Residence Agreements , authored by Paul Gordon of Hanson Bridgett LLP, will identify the range and variety of provisions usually found in different senior living community types to help you make an informed decision as you continue your senior living search. Below is an overview of what’s included in the downloadable guide.
Before moving into a senior living community, you must first sign a residence agreement that outlines your rights and obligations, as well as those of the community for the duration of your stay.
Put simply, resident agreements are legal documents that come in a variety of forms depending on the type of community. Agreements may also vary due to state regulations and the policies and customs of the community and local market.
Typically, resident agreements include:
The residence agreement identifies the community owner/operator and whether the community is part of a corporation, limited liability company (LLC) or a nonprofit. The agreement should also identify whether the operator holds a state-issued license and describe the type of license.
The resident(s) will also be identified. Some senior living communities will require financial or health care information.
The contract should describe the kind of senior living community – independent living, assisted living, memory care, or continuing care/life plan community – along with the location. The type of residence and specific apartment or unit number should also be described (e.g., one-bedroom, two-bedroom, apartment, cottage, etc.).
Hospitality services including dining, housekeeping, recreational activities or amenities, fitness and beauty services, transportation, parking, and the like should be included in the agreement.
While it usually isn’t necessary to have a state-issued license to offer hospitality services, properties offering licensed care, such as assisted living or memory care, will also include such services customized to cater to the needs of their residents.
For communities offering dining, the scope and extent of meal programs – and their costs – should be included in the agreement.
Recreational activities, services and amenities may also be described and should clearly identify what is included in the monthly fee and what requires payment of an extra charge. In licensed care settings, many of these services like housekeeping, laundry, and transportation are available as part of the monthly fee, and sometimes mandated by licensing regulations.
Assisted living, memory care, and continuing care/life plan communities offer varying degrees of personal care to their residents. Care can include assistance with a wide variety of “activities of daily living” (ADLs) such as medication management, assistance with bathing, grooming, dressing, eating, ambulation/transferring, toileting, and other essential functions.
All residency agreements should specify in detail the types of care services available, which are unavailable or excluded, what services are included in the monthly fee, which involve an extra charge (and the price) and under what circumstances a transfer to another venue on-campus or off-campus is required due to changing care needs.
Most senior living communities charge a monthly fee for all the routine services, including hospitality services, and where available, basic care services. There are usually exclusions that require an extra charge for specific optional services.
In addition to monthly fees, many assisted living properties charge an upfront, lump-sum “community fee,” which may or may not be refundable or partially refundable for a brief period after the commencement of occupancy. Community fees can be a fixed amount or may be the equivalent of one month, to a few months, of monthly fees.
Continuing care/life plan communities often charge much more substantial “entrance fees,” which can involve hundreds of thousands of dollars or more. Larger entrance fees often, but not always, include some provision for repayment when the resident no longer resides in the community.
These communities offer a variety of contracts. An extensive agreement has the highest entrance or community fee, but higher levels of care are covered with little or no increase in monthly service fees (Type A). Modified agreements typically have lower entrance fees and provide healthcare services as needed at costs that may be lower than you’d pay outside the community (Type B). Fee-for-service (Type C) contracts have the lowest entrance fees, and you only pay for the care you need.
All senior living residence agreements will have termination provisions, and many will specify the circumstances under which a resident may be asked to relocate from their current residence to another destination within or outside of the senior living community.
In addition to nonpayment or conduct that violates community rules or endangers others, senior living agreements often describe circumstances when a resident needs to move because of health issues that make continued stay at the community difficult or impossible to sustain. Relocation based on health conditions vary widely depending on whether it is an independent living, assisted living, memory care, or continuing care retirement community.
Senior living residence agreements, and sometimes the resident handbook, can cover a myriad of miscellaneous subjects beyond the basics. Some common examples include:
For licensed communities, long listings of resident rights also are commonly required by state regulations, and usually presented as an appendix to the main agreement.
Consumer’s Guide to Senior Living Residence Agreements:
Where You Live Matters is powered by the American Seniors Housing Association (ASHA), a respected voice in the senior housing industry. ASHA primarily focuses on legislative and regulatory advocacy, research, and educational opportunities and networking for senior living executives, so they can better understand the needs of older adults across the country.
Originally Published: September 24, 2019 – Updated On: March 26, 2024
Hanson Bridgett LLP
Paul has been working with seniors housing and care providers since 1975. He is the author of the book Seniors’ Housing and Care Facilities: Development, Business and Operations (Urban Land Institute, 1998) and has been called “godfather of senior housing” by the Chambers USA legal directory. Paul’s entire practice is devoted to representation of seniors housing, long-term care providers, and related organizations. This includes business transactions, regulatory compliance, risk management and dispute resolution, fair housing and ADA compliance and operations counseling. He litigates in federal and state courts, including court and jury trials and appellate work. He has been instrumental in drafting state and model national continuing care and assisted living facility legislation and the U.S. General Accountability Office consulted with him in preparation of its report to the Senate on Continuing Care Retirement Communities. Given Paul’s tenure and experience in the industry, he also serves as an expert witness on senior living communities in federal and state courts. Paul is a highly sought-after speaker with an international reputation. He has addressed audiences at conferences sponsored by the Urban Land Institute, Harvard University, Boston University, China Real Estate Chamber of Commerce, Sun-Yat Sen University in Guangzhou, China, the American Bar Association, The Canada Forum, the World Research Group, the American Seniors Housing Association, LeadingAge, the National Investment Center, the American Society on Aging, the American Health Care Association, the National Real Estate Development Center, AIC Conferences, Ernst & Young, Coopers & Lybrand, Laventhol & Horwath, the Practicing Law Institute, the National Academy of Elder Law Attorneys, and the American Health Law Association. Paul has written or consulted on articles on retirement community development and operations published in The New York Times, The Wall Street Journal, Consumer Reports, Urban Land Magazine, Seniors Housing Business, the National Real Estate Investor, Provider Magazine, Contemporary Long-Term Care, Multi Housing News, The Practical Real Estate Lawyer, and Retirement Housing Report.
