CCRC Contract Types: Type A, B, C Explained (Life Care vs Fee-for-Service)

CCRCs offer three main contract types. The type you choose determines how much you pay upfront and what happens to your costs if you need assisted living or nursing care.

Type A contracts—also called Life Care or All-Inclusive—offer the most comprehensive coverage.

• **Entrance fee**: Highest (often $400,000-$1,000,000+)
• **Monthly fee in independent living**: Moderate ($3,000-$5,000)
• **Monthly fee in assisted living**: Same or small increase
• **Monthly fee in skilled nursing**: Same or small increase
• **Coverage**: Unlimited days of assisted living and nursing care included
• **Predictability**: Most stable long-term costs

Type B contracts offer a middle ground—some coverage for higher care levels, but not unlimited.

• **Entrance fee**: Moderate ($200,000-$600,000)
• **Monthly fee in independent living**: Lower than Type A ($2,500-$4,000)
• **Monthly fee in assisted living**: Increases (often +$1,000-$2,000)
• **Monthly fee in skilled nursing**: Increases significantly (often +$2,000-$4,000)
• **Coverage**: Some days/months of care included (e.g., 30-60 days/year at no extra cost)
• **Predictability**: Moderate—you know costs will rise, but some coverage cushions the blow

Type C contracts have the lowest entrance fee but offer little to no coverage for higher care levels.

• **Entrance fee**: Lowest ($100,000-$400,000)
• **Monthly fee in independent living**: Lowest ($2,000-$3,500)
• **Monthly fee in assisted living**: Full market rate (often +$2,000-$4,000)
• **Monthly fee in skilled nursing**: Full market rate (often +$4,000-$8,000)
• **Coverage**: None—you pay market rates for all higher care
• **Predictability**: Lowest—costs can skyrocket if extensive care is needed

Here's a detailed comparison of the three contract types:

Most CCRCs offer multiple refundability options within each contract type. Refundability determines how much of the entrance fee returns to your estate when you die or move out.

Choosing the right contract type depends on your health, finances, and risk tolerance.

1. 1**Assess your health**: Family history of Alzheimer's, chronic illness, or frailty? Type A.
2. 2**Consider your finances**: Can you afford the high entrance fee of Type A? Or is Type C more realistic?
3. 3**Evaluate risk tolerance**: Willing to gamble on staying healthy? Type C. Want predictability? Type A.
4. 4**Think about longevity**: If you expect to live in the CCRC for 20+ years, Type A may save money long-term.
5. 5**Factor in estate planning**: Want to leave inheritance? Choose refundable option.
6. 6**Compare total lifetime costs**: Ask the CCRC for projections of total costs over 10-20 years for each contract type.

Whether you choose Type A, B, or C, CCRC entrance fees represent a massive commitment of retirement capital. Type A contracts require $400,000-$1M+ upfront, while even Type C contracts require $100,000-$400,000. Protecting your remaining assets from inflation and market volatility is essential, as monthly fees increase over time and you'll need liquid reserves for unexpected expenses.