The WSJ offers bad advice – move into a CCRC sooner vs. later

The Wall Street Journal offers advice to well-to-do older adults.  This time the advice comes from Glenn Ruffenach, a frequent writer for the WSJ retirement section.  The query comes from a healthy couple in their early 70s who wonder if it is time to move into a CCRC (Continuing Care Retirement Community). They hesitate, observing that the residents seem decidedly older. A good observation – they are!  Glenn says to move now, rather than wait. Really? For people in their early 70s? The median age of move-in to CCRCs is climbing – noted as of 2016 to be age 81 – and the residents’ average age is now 85.  The CCRC has been a buy-in offering combining independent living homes, assisted living and skilled nursing facility (SNFs). Many faith-based non-profits are structured that way. But the nation’s largest for-profit firm, Brookdale, offers a ‘rental’ model -- Caring.com’s 2017 description – why? People are deferring the move. In 2016, CCRC occupancy has reached 90% in only one quarter. 

The CCRC conundrum and WSJ advice sounds like the LTC insurance dilemma. The CCRC rationale -- hedge against changes in future needs (independent to memory care). Hedge against future costs (average price increase for assisted living rose 2% in the past five years). Hedge against change in circumstances (from married to widowed, for example.)   So it sounds practical and smart to plan for the future – and insurers thought so too, selling long-term care insurance policies to people in their 50s.  See what happened to the crumbling long-term care insurance market and the consumer’s experience -- hedging in your 50s against future risk in your 80s or 90s. Every life expectancy assumption was wrong, many insurers left or are leaving the market, and some consumers wish they still had their money from all of those recently quadrupled premiums.  

So should the reader listen to WSJ and buy something 14 years before it is needed? If the real need doesn't arise until the mid-80s, why advise people to buy in their early 70s?  Are there no other options?  Here are six that he did not mention.  1) Sell the house and move to a 55+ community. 2) Sell the house and move to an rental assisted living community at age 81-85. 3) Work together to form a NORC.  4) When needed, ask adult children for an in-law apartment or buy a home that has one and move with them. 5) Form a village that coordinates home care, transportation and food delivery options near the current home. 6) Consider co-housing options – now there is even an association of them!  

WSJ: the CCRC is a place, not an investment strategy.  And moving there doesn’t even imply just one place – consider the scenario of a couple moving into a shared apartment -- later the wife must move into the locked memory care unit, another place. Or both to assisted living in another part of the campus – that counts as another place – mroe downsizing and moving yet again.  Perhaps this is appreciated up front. Iif a couple has substantial financial assets, wants what a CCRC is offering – and recognizes themselves there when visiting.  But like long-term care insurance, there may be a mismatch between what’s been built and what people really need when they move in.  And assisted living (with memory care units) is similarly opaque. There is no nationwide regulation of either CCRCs or assisted living. Practices and services such as restricted access to dining rooms may be poorly understood at time of move-in, and many residents in assisted living sections of CCRCs may already have some form of dementia.