Residents, advocates urge state limits and safeguards on CCRC entrance-fee refunds

Residents of continuing care retirement communities and consumer advocates told the Special Commission on Continuing Care Retirement Communities on June 9 that entrance‑fee refund practices can leave former residents without timely access to life savings and asked the legislature to set firm limits and financial safeguards.

Ivy Cooley, who testified she is the primary caregiver for her 80‑plus‑year‑old mother, said the family was owed $170,000 after her mother moved from independent living to an assisted‑living memory care unit and that “it took 18 months for her unit to be rerented.” Cooley said that the facility’s refund policy — which requires re‑rental of the same specific apartment before a refund is triggered — “discriminates against less affluent residents” whose units are less desirable and can mean long delays in getting funds returned.

Cooley urged multiple protections: limits on the time a facility may retain entrance fees, moving to refund systems that use an order‑of‑vacancies (rather than a specific apartment), placing a portion of entrance fees in interest‑bearing escrow or endowments, requiring actuarial reserves or surety bonds, and creating a state guarantee fund to protect resident deposits. “Make entrance fees nonrefundable. Offer a lower refund percentage, put some of the money in interest bearing escrow funds or in an endowment and use the interest and uncommitted percentage for the operating budget,” she said.

Denny Janie, a resident of Linden Ponds, reiterated the call for time limits on refunds and asked that returned monies be required “within a reasonable time frame, let's say, a year.” Multiple speakers reported instances of long delays and cited bankruptcy as a circumstance that can sharply reduce or postpone refunds.

Commission members and witnesses noted existing statutory context referenced at the start of the hearing: the special commission was established “in section 29 of last session's long term care reform law, chapter 197 of the acts of 2024,” which charged the commission with studying entrance‑fee policies and consumer protections. Witnesses requested that the commission recommend specific statutory language and oversight measures to reduce consumer risk.

Proposed oversight steps described by witnesses included annual certificates of solvency filed with state regulators, mandated actuarial reserves for future refund liabilities, and requirements that facilities disclose refund mechanics and typical timelines to prospective residents at the point of sale. Several witnesses suggested a central consumer information repository, hosted by the Executive Office of Aging and Independence, to provide standard disclosure documents and comparisons across CCRCs.

Commission members asked clarifying questions about existing housing and consumer protections and about whether different apartment types should be treated differently when reporting average refund times. Senator Pat Jalen observed that “it depends on which kind of apartment you're in” and recommended any public data be disaggregated by unit type.

The commission did not take formal votes at the hearing. Commissioners said the testimony would inform the group's recommendations to the Legislature.

Ending: Witnesses asked the commission to include concrete, enforceable rules in its report — time limits for refunds, financial safeguards such as escrowed funds or reserve requirements, and publicly available disclosure documents — to reduce the risk that residents will lose timely access to substantial sums they used to secure long‑term care at CCRCs.