Assisted Living Resident Agreements: What You Should Know

From independent and assisted living to skilled nursing and memory care, distinct types of senior living communities have different financial and admission agreements.  And understanding your community’s resident agreement can be as important as getting a referral, taking a tour, talking with other residents, or sampling the food in the dining room. So, before signing on the dotted line it’s vital to fully understand what you’re signing.

Our Consumer’s Guide to Senior Living Residence Agreements , authored by Paul Gordon of Hanson Bridgett LLP, will identify the range and variety of provisions usually found in different senior living community types to help you make an informed decision as you continue your senior living search. Below is an overview of what’s included in the downloadable guide.

Resident Agreements Defined

Before moving into a senior living community, you must first sign a residence agreement that outlines your rights and obligations, as well as those of the community for the duration of your stay.

Put simply, resident agreements are legal documents that come in a variety of forms depending on the type of community. Agreements may also vary due to state regulations and the policies and customs of the community and local market.

Typically, resident agreements include:

1. Identification of the parties
2. A description of the senior living community and the residence to be occupied
3. A description of the services available at the community
4. Resident fees payable to the owner/operator
5. Circumstances that can result in relocation of the resident or contract termination
6. Miscellaneous rights of the parties

The Parties

The residence agreement identifies the community owner/operator and whether the community is part of a corporation, limited liability company (LLC) or a nonprofit. The agreement should also identify whether the operator holds a state-issued license and describe the type of license.

The resident(s) will also be identified. Some senior living communities will require financial or health care information.

Community and Residence

The contract should describe the kind of senior living community – independent living, assisted living, memory care, or continuing care/life plan community – along with the location. The type of residence and specific apartment or unit number should also be described (e.g., one-bedroom, two-bedroom, apartment, cottage, etc.).

Description of Services

Hospitality

Hospitality services including dining, housekeeping, recreational activities or amenities, fitness and beauty services, transportation, parking, and the like should be included in the agreement.

While it usually isn’t necessary to have a state-issued license to offer hospitality services, properties offering licensed care, such as assisted living or memory care, will also include such services customized to cater to the needs of their residents.

For communities offering dining, the scope and extent of meal programs – and their costs – should be included in the agreement.

Recreational activities, services and amenities may also be described and should clearly identify what is included in the monthly fee and what requires payment of an extra charge. In licensed care settings, many of these services like housekeeping, laundry, and transportation are available as part of the monthly fee, and sometimes mandated by licensing regulations.

Care Services

Assisted living, memory care, and continuing care/life plan communities offer varying degrees of personal care to their residents. Care can include assistance with a wide variety of “activities of daily living” (ADLs) such as medication management, assistance with bathing, grooming, dressing, eating, ambulation/transferring, toileting, and other essential functions.

All residency agreements should specify in detail the types of care services available, which are unavailable or excluded, what services are included in the monthly fee, which involve an extra charge (and the price) and under what circumstances a transfer to another venue on-campus or off-campus is required due to changing care needs.

Resident Fees

Most senior living communities charge a monthly fee for all the routine services, including hospitality services, and where available, basic care services.  There are usually exclusions that require an extra charge for specific optional services.

In addition to monthly fees, many assisted living properties charge an upfront, lump-sum “community fee,” which may or may not be refundable or partially refundable for a brief period after the commencement of occupancy.  Community fees can be a fixed amount or may be the equivalent of one month, to a few months, of monthly fees.

Continuing care/life plan communities often charge much more substantial “entrance fees,” which can involve hundreds of thousands of dollars or more.  Larger entrance fees often, but not always, include some provision for repayment when the resident no longer resides in the community.

These communities offer a variety of contracts. An extensive agreement has the highest entrance or community fee, but higher levels of care are covered with little or no increase in monthly service fees (Type A). Modified agreements typically have lower entrance fees and provide healthcare services as needed at costs that may be lower than you’d pay outside the community (Type B). Fee-for-service (Type C) contracts have the lowest entrance fees, and you only pay for the care you need.

Resident Relocation and Contract Termination

All senior living residence agreements will have termination provisions, and many will specify the circumstances under which a resident may be asked to relocate from their current residence to another destination within or outside of the senior living community.

In addition to nonpayment or conduct that violates community rules or endangers others, senior living agreements often describe circumstances when a resident needs to move because of health issues that make continued stay at the community difficult or impossible to sustain.  Relocation based on health conditions vary widely depending on whether it is an independent living, assisted living, memory care, or continuing care retirement community.

Miscellaneous Issues

Senior living residence agreements, and sometimes the resident handbook, can cover a myriad of miscellaneous subjects beyond the basics.  Some common examples include:

• Community rules and regulations that promote smooth operations.
• Liability for damages caused by a resident (or guest)
• Relationships with staff (tipping limits, interfering with staff duties, etc.)
• Arbitration clauses
• Resident Rights

For licensed communities, long listings of resident rights also are commonly required by state regulations, and usually presented as an appendix to the main agreement.

Additional Tips for Reviewing Resident Agreements

• Request copies in advance, so you have time to review and make notes.
• Ask as many questions as necessary — communities want you to make informed decisions.
• You may want to have a lawyer or financial advisor review contracts as well.
• Before you make a visit to a community, arm yourself with this information about senior living contracts so you can feel confident in planning your future.

Consumer’s Guide to Senior Living Residence Agreements:

Download

Where You Live Matters

Where You Live Matters is powered by the American Seniors Housing Association (ASHA), a respected voice in the senior housing industry. ASHA primarily focuses on legislative and regulatory advocacy, research, and educational opportunities and networking for senior living executives, so they can better understand the needs of older adults across the country.

_{Originally Published: September 24, 2019 – Updated On: March 26, 2024}