Life care vs. fee-for-service

What’s the difference?

Created date

March 23rd, 2020
The beautiful lake at Eagle's Trace shines in the blue sun.

Eagle’s Trace, a continuing care retirement community in West Houston developed and managed by Erickson Living, offers an engaging, active lifestyle with a sensible financial structure.

If you’re considering a move to a continuing care retirement community (CCRC), chances are you’ve given some thought to your future health care needs.

Continuing care retirement communities like Eagle’s Trace, developed and managed by Erickson Living in West Houston, offer independent living apartments as well as the full continuum of care on campus, including assisted living, short-term rehabilitation, long-term nursing care, and memory care.

Amenities, location, care options, and social opportunities are all important factors in choosing a CCRC. Financial structure is another key consideration, as not all CCRCs operate on the same model.

To learn more about the costs associated with a potential move to a CCRC, the Tribune sat down with Kimberly Thies, sales manager at Eagle’s Trace, who assists future residents through the financial aspects of their move.

Q: What are the different types of CCRCs, and how do their financial structures compare?

A: When it comes to finances, there are generally three different types of CCRCs. The first is an extensive or life care contract (Type A), which has the highest monthly fees and potentially higher entrance costs. Should a resident require a higher level of care, the monthly fee remains consistent, other than increases for inflation. Essentially, residents pre-pay for long-term care.

A modified contract (Type B) has lower monthly fees and entrance costs than a life care community, but there are limits on the amount of health care services residents can receive without an increase in their monthly fee.

Fee-for-service communities (Type C), like Eagle’s Trace, have the lowest monthly fees and typically lower entrance costs than other types of contracts. Residents pay for advanced levels of care only if and when they need them.

Q: You mentioned two different fees: a monthly fee and entrance costs. Can you tell me more?

A: Eagle’s Trace offers a financial model that’s both affordable and secure for most retired homeowners. There are two basic components to consider—the entrance deposit and the monthly service package.

The onetime entrance deposit depends on the size and location of your apartment home, and it secures your apartment for as long as you live at the community. The deposit is 90% refundable to you or your heirs. Details are outlined in our Residence and Care Agreement, which we’ll be happy to share with you.

The monthly service package is a single bill that covers almost all regular living expenses, including utilities, flexible meal options, and scheduled on- and off-campus shuttle services. This fee stays the same all year long, so your expenses are predictable and economical.

Q: What are the chances I’ll need long-term care?

A: You can find a lot of information online about the odds of needing long-term care. The most reliable sources estimate just under 50% of those over age 65 will need long-term support and services at some point.

When you consider the numbers, it doesn’t make sense to pay for something you may not need. Some life care communities have monthly fees that are twice as much as the average monthly fee at Eagle’s Trace. It’s a good idea to do a cost benefit analysis to evaluate your options and determine the best approach to reap the benefits of living at a CCRC while preserving as much of your savings as possible.

Q: What are the benefits of moving to a CCRC?

A: Ease of socialization, maintenance-free living, and access to support services are some of the key benefits to moving to a CCRC like Eagle’s Trace. It’s easy for people to become isolated in their homes after they retire, and a community like ours offers built-in social and fitness options to keep community members active and engaged.

Our goal is that you won’t need long-term care, because the holistic lifestyle offered at Eagle’s Trace addresses all seven dimensions of wellness: social, emotional, spiritual, environmental, intellectual, occupational, and physical. Everything you need to remain independent and thriving is right here on campus.