Continuing Care Retirement Communities
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 3,700 firms classified as continuing care retirement communities (CCRCs) in the US operate 5,300 facilities. Services include assisted living with on-site skilled nursing facilities, independent living, assisted living, and skilled nursing services either on campus or at nearby facilities. These facilities involve a contract each resident signs, entitling them to a continuum of care in exchange for payment of an entrance fee and ongoing monthly fees.
Sensitivity to Capital Markets
Difficulty in obtaining financing or in re-financing existing debt can force CCRCs to delay needed renovations, postpone planned expansions, or prevent them from breaking ground.
Demographic Trends Grow Demand
Since January 2011, baby boomers have been turning age 65 at a rate of 10,000 per day - and this will continue for 20 years.
Industry size & Structure
The average CCRC has about 128 employees and generates $10.5 million in annual revenue.
- There are about 3,700 CCRC firms in the US operating 5,300 facilities with $40 billion in annual revenue and 485,000 employees.
- About half of facilities are "true" CCRCs offering care from independent living through skilled nursing under a contract that guarantees a continuum of care in exchange for an entrance fee and ongoing monthly fees.
- About half of "true" CCRCs are affiliated with faith-based organizations, such as Presbyterian, Lutheran, Methodist, or Catholic churches.
- Companies that own and operate multiple communities include Life Care Services and Erickson Living.
- CCRCs are located in a range of geographical areas from urban to suburban to rural.
Industry Forecast
Continuing Care Retirement Communities Industry Growth
Recent Developments
Mar 6, 2023 - March 2023 – Retirement Communities Provided Safe Environment During Pandemic
- Residents of continuing care retirement communities were “significantly safer” from dying from COVID-19 than were older adults living in noncongregate residential settings in the greater community, according to a study conducted by researchers at the University of Chicago. Independent living, assisted living, and memory care residents were found to be as safe or almost as safe as those living in the greater community once COVID-19 vaccines became available. The study found that the difference in death rates during the COVID-19 pandemic, relative to deaths before the pandemic, was strongly reduced in all senior housing settings after COVID-19 vaccines were introduced. The researchers found that living in any type of senior housing was safer than living in a long-stay skilled nursing facility during COVID-19, both before and after the vaccines became available.
- Public-health officials and doctors are encouraging masking as respiratory infections surge. Experts disagree, however, on whether masks are enough to guard against flu and RSV, and Covid-19, and on whether people are willing to wear them after the country has largely moved on from pandemic precautions—is another matter. “I’m not optimistic” that people are willing to mask again, says Eric Topol, director of the Scripps Research Translational Institute in La Jolla, Calif. “There’s such a reluctance to go what is considered backward, even though it’s actually forwards in terms of helping one another.” Masks help provide protection against flu and RSV, medical experts say, as do other precautions. RSV, a common respiratory virus, also often spreads through expelled virus particles on surfaces, so frequent handwashing and cleaning of contaminated surfaces can help fight its spread, says Scott Roberts, an infectious disease specialist at the Yale School of Medicine.
- Skilled nursing Medicare payment increases have been approved. The annual Inpatient Prospective Payment System final rule issued by the Centers for Medicare and Medicaid Services (CMS) includes a 2.7% year-over-year increase in Medicare Part A payments to skilled nursing facilities for fiscal year 2023. The federal government fiscal year begins on October 1 and ends on September 30 of the following calendar year. CMS is also finalizing a permanent 5% cap on annual wage index decreases to mitigate instability in SNF prospective payments due to significant wage index decreases that may affect providers in any given year. The cap is intended to smooth year-to-year changes in providers’ wage index payments.
- A federal vaccine mandate for facilities that take Medicare or Medicaid payments remains in place. "We agree with the Government that the [Health and Human Services] Secretary's rule falls within the authorities that Congress has conferred upon him," said a US Supreme Court majority, which wrote that the rule "fits neatly within the language of the statute. After all, ensuring that providers take steps to avoid transmitting a dangerous virus to their patients is consistent with the fundamental principle of the medical profession: first, do no harm."
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