Across the broad spectrum of senior living options, a continuing care retirement community is often considered the top-shelf option for seniors who have the means to make one move into a single community that promises to serve all of their needs over time.
These communities often require hefty upfront buy-in fees, but they promise a level of cost control in the future as care needs change. They also often come with complex contracts, but a move to a CCRC can be a smart hedge against inflation for seniors who have the money to make that foreplanning move.
Read on for everything you need to know about CCRC contracts and how the various different types of contracts typically work.
[READ: 10 Things to Look for When Touring a Senior Living Facility]
What Is a CCRC?
Often referred to as life plan communities, CCRCs offer multiple levels of care in a single facility or campus. Levels of care often include:
“What sets life plan communities apart from other senior living options is their comprehensive approach to health, wellness and lifestyle, ” says Brian G. Lawrence, president and chief executive officer of FellowshipLIFE, an aging services provider based in New Jersey.
When compared with other senior living communities, he says, “a key differentiator is that residents can transition seamlessly between these care levels as their needs change, providing continuity and peace of mind.”
As part of their comprehensive care, most CCRCs offer these amenities:
— On-site medical support
— Five-star dining options
— Lifelong learning opportunities
— Recreational activities
— Wellness programs
What Is a CCRC Contract?
To enter one of these senior living communities, a prospective resident will need to sign a contract with the company providing the living space and services. This document is an agreement between the prospective resident and the property’s operators that outlines the parameters of the business relationship between the two parties.
These contracts can be complex, but they’re very important because they dictate your stay in a CCRC, covering everything from:
— Type of accommodations
— Care services
— Monthly fees and added costs
— Resident rights and responsibilities
— Provider rights and responsibilities
[READ: A Checklist for Choosing the Best CCRC Facility]
Types of CCRC Contracts
There are a few different types of CCRC contracts that you may be offered when considering moving into one of these senior living communities. Below are details about each type and what you can expect from them.
— Life care contract (Type A)
— Modified life care contract (Type B)
— Fee-for-service contract (Type C)
— Monthly agreements (Type D)
— Equity contracts (Type E)
Life care contract (Type A)
Type A contracts are also sometimes called exclusive or life care contracts because they are the most comprehensive type of CCRC contract. These contracts include:
— The residence (an apartment or room within the community)
— Assisted living services
— Skilled nursing care when required
— Use of all amenities on campus
— Memory care for Alzheimer’s disease or dementia
— Other health care needs and services as needed
Because Type A contracts cover all eventualities for CCRC care, they’re typically the most expensive of all the contract types a CCRC offers. They usually require a hefty upfront entrance fee, which can range from a few hundred thousand dollars to a million or more depending on the community.
But the entry fee is often partially refundable, meaning that if you move out or die, you or your heirs will get some portion of the entry fee (typically 50% to 90%) back.
In addition to paying that upfront fee (which in some cases can be broken out into smaller payments over a period of time), you’ll be asked to pay a monthly rate for rent and services. Plus, some type A contracts also charge an entrance fee deposit or an initiation fee on top of the monthly fee.
But, because these contracts are essentially all-inclusive, you have a set price going forward, no matter how your health needs change over time. “A key benefit of Type A contracts is that they lock in a fixed rate (adjusted annually for inflation), offering financial stability as residents move through different levels of care from independent living to skilled nursing,” Lawrence explains.
So while the initial lump sum is high, the future costs for skilled nursing are often guaranteed at a lower, predictable rate, making this contract type a potential inflation hedge for long-term care in 2026.
It’s also worth noting that a portion of CCRC entrance and monthly fees may be tax-deducible as prepaid medical expenses, even if you aren’t using health care services yet. To get this deduction, you’ll have to itemize your deductions, and your total medical expenses must exceed 7.5% of your adjusted gross income. The rules around this vary by community so it’s best to consult with a tax professional in your state to ensure you’re complying with tax laws.
Modified life care contract (Type B)
Type B contracts, also called modified life care contracts or modified fee-for-service contracts, provide many of the same provisions as Type A contracts, including living accommodations, assisted living services, dining options and transportation.
“Modified life care contracts are prepaid, partial coverage which allows for cost of care needs to change,” explains Christopher Norman, a Jamesville, New York-based board-certified geriatric nurse practitioner. He serves as director of educational programming and research and associate medical director at PACE CNY in Syracuse, New York.
In other words, these contracts will include some of your anticipated future needs, but maybe not all.
Because you’re not paying for everything upfront, as you move through levels of care, you may end up spending more than if you had selected a Type A contract and locked in the total rate earlier in your tenure.
However, for people who have less cash on hand to spend, a Type B contract might offer a way into a CCRC community because they tend to be a little less expensive than Type A contracts.
Fee-for-service contract (Type C)
Type C contracts, which are also called fee-for-service contracts, “typically include entrance fees and monthly fees, but the cost of care services increase as more advanced care is needed,” Lawrence says.
With a Type C contract, the upfront or monthly fees may be lower than with a Type A contract, but “residents pay more for higher levels of care as they use them,” Lawrence says. That’s because the rate is not locked in from the very beginning of the residency; rather, it is assessed at the time of need.
Costs in the senior care space are always increasing, so if you anticipate that you will need more, costlier care later on, opting for an all-inclusive contract from the beginning might save you some money in the long run.
Monthly agreements (Type D)
Some CCRCs also offer monthly rental agreements, which are “similar to an apartment where you would pay month-by-month or for a determined amount of time,” Norman says.
The monthly rate is just for the rental of the living space exclusive of health care, assistance with daily tasks and other benefits that are billed at the market rate at the time they’re rendered. These contracts can be a good option for people who are more independent and don’t anticipate needing a lot of additional support.
Not all CCRCs offer this type of contract, and it’s important to note that health care services and other amenities are added on top of this monthly rate. Health care services may not be guaranteed under these contracts either.
Equity contracts (Type E)
While many CCRCs offer the living space as a rental property, there are some that allow residents to buy their own home or condo within the community. These contracts typically include a monthly service fee or homeowners association payment in addition to property taxes.
With equity contracts, you’ll have to pay extra for most of the amenities offered through the community, such as meals and assistance with activities of daily living. These fees will be assessed at the time they’re rendered and offered at the current rate. Some CCRCs may also offer a Type B or Type C contract to cover these needs separately from the equity contract to purchase the living space.
CCRC Contract Types at a Glance
See how the various contract types compare to one another and how that can impact your costs in 2026 and beyond.
| Contract Type | What’s Included | Pricing and Costs | Pros | Cons | Who It’s Best For |
| Type A: Life care or exclusive | Everything, including:
— Living space — Assisted living and nursing care services — Campus amenities — Other health care as needed |
Large buy-in sum up front followed by a monthly rental fee that may be locked in at a specific rate or only adjust with inflation; monthly bill also includes all amenities and services that you might need | Long-term cost control through all-inclusive pricing; care costs are locked in at time of move-in so you’ll have financial predictability no matter when you need that care; entry fee may be partially refundable | Hefty entrance fee (up to $1 million or more depending on the community) and higher monthly fees to cover all services you might never need to use | Seniors who want long-term financial predictability and expect to need high levels of care over time |
| Type B: Modified life care or modified fee-for-service | Almost everything, including:
— Living space — Assisted living — Dining and some campus amenities — Some future health care services |
Typically a smaller upfront buy-in cost, with a monthly fee to cover services and amenities; health care costs are billed separately as needed | Lower upfront cost than Type A but still offers a wide range of services and amenities | Partial coverage; costs may escalate later if care needs increase | Seniors who want some cost stability in the future and expect to need more care eventually, but who don’t have the buy-in fee to meet Type A contract requirements upfront |
| Type C: Fee-for-service | Limited to:
— Residence — Basic services and amenities |
Monthly fees cover residence and basic services and amenities; health care services are purchased at the time care is rendered at market prices | Less expensive than Type A or B contracts upfront; resident doesn’t pay for health care services they don’t need | No rate lock; health care paid at market rates when needed, meaning costs can increase significantly if advanced care is needed later | Residents who don’t expect to need extensive health care or who can tolerate financial risk |
| Type D: Monthly rental agreement | Living space only | Monthly fee covers only the cost of the living space; all other amenities and services are billed separately at time of need | Lowest cost commitment; covers the living space only and no cost for services not being used | All care needs are billed separately at market rates | Independent residents who don’t need much or any assistance and who want more flexibility |
| Type E: Equity or ownership contract | Purchase of living space within a community | Purchase price of the property plus a monthly service fee, HOA fee and taxes; a separate type B or C contract may also be in place to cover care and service needs separately | Asset ownership and no need to pay for services not being used | Care and services are billed at time of use at current market rates | Seniors who want to own their own living space and are comfortable with paying for care as needed |
Key Elements of a CCRC Contract
CCRC contracts can be complicated, and nestled in those many pages and paragraphs will be all the details related to what you’re purchasing, how much it costs and what expectations you can have from the community in rendering those services.
Entrance fees and monthly charges
Most CCRCs charge an entrance fee which can range widely, from tens of thousands of dollars to over $1 million. These fees may be assessed as a sum total upfront or may be broken into smaller payments. In some instances, they may be incorporated into the monthly bill.
The National Investment Center for Seniors Housing & Care reports that in the first half of 2025, the average monthly fees in the independent living section of a CCRC started at about $3,800 for rental contracts and $4,285 for entry-fee contracts. The most expensive monthly rates were in memory care, and these averaged $8,132 with rental contracts and $9,695 for entry-fee contracts.
Terms of care and services
Your CCRC contract will outline the specific terms related to care and services that will be covered for the fee being charged. This can include everything from meals and health care to transportation off campus.
Refund policies and transfer conditions
Some CCRC contracts offer refunds on the entrance fee.
“Both Type A and Type C contracts may offer a refundable entrance fee option (typically 50% to 90%), which involves a higher entrance fee but provides financial flexibility and estate planning advantages,” Lawrence says.
In addition, some communities may also offer discounts on long-term care services under Type C contracts, so be sure to read all the fine print carefully before committing to any contract.
Understanding CCRC Requirements and Regulations
There are also some regulatory requirements and standards that CCRCs must follow, and these will likely be referenced in the contract you’re reviewing.
State and federal regulations
Norman notes that contracts vary not only by facility, but also by the state in which the facility is located; different states have differing regulations that govern how CCRCs and other senior living facilities can operate.
Both the state and the federal government have regulations in place for CCRCs. If the community accepts payments from Medicare or Medicaid, it will be subject to stringent health care regulations from the Centers for Medicare & Medicaid Services and possibly the state. Any health care activities performed by employees of the CCRC must be in accordance with local licensure laws.
Norman adds that some CCRC contracts include stipulations whereby a person can be evicted from the CCRC.
“People often must meet physical and cognitive standards, which are determined by state regulations and also the facility itself, to be admitted and to stay within a CCRC,” he says.
Financial stability and accreditation
In some states, CCRCs must undergo annual financial auditing, and there may be some very specific requirements about operating reserve levels versus forecasted operating costs in some states. Not all states require this, however, so it’s best to talk with someone knowledgeable about the rules in your state to understand whether a CCRC you’re considering is financially stable and up to date with all necessary accreditations.
Rights and protections for residents
The contract you sign dictates your rights and what you can reasonably expect from a CCRC. These rights typically include:
— The right not to be deprived of any civil or legal rights that are guaranteed by law in the state where you live
— The right to have a voice in decisions regarding your health and financial dealings
— The right to review recent inspection reports and other documentation related to the facility’s performance
— The right to receive timely notification of changes in ownership, new construction and other developments that may affect the financial operation of the facility
— The right to live in a safe, well-maintained environment
— The right to reasonable accommodations for disabilities
However, there may be some limitations to your rights at a CCRC, depending on the terms of your contract. Norman notes that “with the exception of your personal property, you are a renter of the premises, not an owner, and thus you’re at the mercy of the CCRC contract and policies.”
If it’s not in writing from the start, it may be difficult for you to pursue certain needs or changes later.
Seek Clarity Before Signing a CCRC Contract
Prospective residents and their families need to thoroughly understand CCRC contracts before committing, as the stipulations outlined in the contract will remain in force for the duration of the contract, which may be for the entirety of your time living in the community.
“Residents and families should carefully review which services and amenities are included,” Lawrence cautions. “Some contracts may cover housekeeping, activities, meal plans or transportation, while others may not. It’s essential to be clear about which services are important to you and ensure that the contract either includes them or allows for their addition.”
He recommends hiring an elder law attorney or trusted adviser to review any contract you’re considering.
“Despite the price tag, amenities and marketing of CCRCs, the ability to ‘age in place’ at a CCRC is not always a guarantee,” Norman adds. “So, I encourage people to understand the fine print before signing a contract.”
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Your Complete Guide to CCRC Contracts originally appeared on usnews.com