Assisted Living Resident Agreements: What to Know Before You Sign

Since most assisted living resident agreements are full of industry jargon and legal terms, it can be difficult to completely understand the conditions of the agreement, which is why it’s beneficial to have an attorney review it on your behalf.

Stuart Furman, an attorney whose practice focuses on elder law in California, explained that most families do not consult with an attorney before signing an assisted living resident agreement. This is often because families don’t realize that some aspects of the contract are negotiable. Another reason is they’re feeling overwhelmed or pressured to make a decision – there’s an available spot, and the senior living community needs to know immediately if the family is going to take it.

“People don’t think they can change the terms,” said Furman, “but an attorney will help you understand what you’re signing, what the terminology really means, and what is and isn’t negotiable.”

As you look at senior living communities, make it a part of your research to review a sample assisted living resident agreement. Familiarize yourself with the provisions that are included in the sample, and compare them to those that you would want to be added. For example, what activities of daily living tasks do you need support with, or what are the monthly costs and fees?

Assisted living or medical care services

Many assisted living resident agreements will be generic documents that favor the interests of the facility, so it is important that provisions are added to the contract to reflect the needs of the individual. The resident or family should insist the contract lists certain items:

• Specific services related to activities of daily living (ADLs)
• Medication management or administration services
• Frequency of services and who will provide them
• All additional fees associated with care services

According to Furman, the community should be able to accommodate care requests from individuals and families as long as the care is allowed under the facility license.

Services

A number of communities will offer options such as laundry and housekeeping services or recreational activities. For residents who are attracted to a community based on the services and activities it provides, it is important to know how often the services are provided and if they are included in the community’s monthly fees. The contract should list the services and activities offered and any additional costs.

Accommodations

When reviewing the section of the agreement that refers to the physical space you or your loved one will be occupying, make sure the following items are clearly stated in the contract:

• The specific unit number you have agreed to rent
• Policies regarding the community’s common spaces
• Maintenance and repair responsibilities of the community
• Acceptable modifications like painting or wallpapering
• Written permission for any structural changes you plan to make

Ask about included amenities, and ask that they be listed on the agreement along with any additional charges. The following are great examples of questions to ask:

• Is the community pet-friendly?
• Is resident parking included?
• Is there additional storage?

It’s also important to make sure that the agreement states the terms and conditions concerning a potential decision to leave the community, for health or other reasons.

What is included in assisted living costs?

Costs of assisted living can be complicated, so it is essential that you take time to understand the pricing structure of the community and request that it be highlighted in the contract. There are some common fee structures across assisted living communities:

• Tiered pricing. Services and care are grouped into separate levels that have their own fees.
• All-inclusive pricing. All services, care, and accommodation fees are provided for one price.
• Fee-for-service pricing. Fees are charged only when services or care is needed.

Is assisted living the right fit?

While there are numerous ways communities charge for services and care, not all states require that communities include fees in the agreement, therefore it often is up to the future resident to make that request.

In addition, if you don’t see anything in your contract about cost-of-living increases, then ask the community when and how often prices typically increase and how much notice they will give you. Then, ask them to add these terms in the contract. According to Furman, cost of living increases are often negotiable.

Involuntary discharge

An involuntary discharge is when a resident is forced to leave the community against their wishes. A review of what conditions would force an involuntary discharge, and options to pursue if that occurs, may be a valuable inquiry for families. Some examples of conditions that could lead to an involuntary discharge include the following:

• Failure to pay rent
• Health-related issues that exceed the community’s level of care
• Health-related issues that pose a risk to other residents such as tuberculosis (TB)

While certain terms of discharge are not negotiable, beware when this part of the contract is left too vague. Furman points out that these terms are often left open because discharges happen on a case-by-case basis. But a community is bound to follow state regulations. So, if you feel the contract you’re considering is too vague, then ask for clarification or examples.

No matter what type of senior living care you’re receiving, the community must meet state regulations that govern discharge situations. Furman explained that California’s “Title 22” defines prohibited conditions as a lower level of care than the resident needs. In other words, if your care needs exceed the level of care that your community can offer, then you aren’t legally able to stay.

Mandatory arbitration

If you find a mandatory arbitration clause in your contract, Furman said cross it out. This is an area that is often negotiable.
A mandatory arbitration clause (sometimes called forced arbitration) requires disagreements to be settled by a third-party arbiter and not in court. Consumer Reports also suggests striking this clause from the contract, stating “there’s little risk that your loved one won’t be admitted if you try this. If the management insists that arbitration is mandatory, you can decide whether it’s worthwhile to agree.”

The contracts at continuing care retirement communities (CCRCs) differ from standard assisted living resident agreements, as they address the continuum of care the community offers. There are three common CCRC contracts, and the best type will depend on your family’s financial situation as well as your current and anticipated health care needs.

• Type A contracts are also known as extensive or life-care contracts. These allow a resident to pay a monthly, pre-determined service fee throughout their life, no matter the type of services or care they need.
• Type B contracts, or modified contracts, offer residents access to all of the health care services available in the community. Residents only pay for the health care they need, usually at a discounted rate. Payments are generally tacked onto their monthly living fees.
• Type C contracts are also known as fee-for-service contracts. In this type of contract, residents often pay an entry fee to the community and pay separately for the full cost of assisted living and skilled nursing care when it is required.

CCRCs, or life-plan communities, offer independent living, assisted living, and nursing care all on one campus. CCRCs are a great option for residents who would like to stay in the same place as they age, even if they end up requiring a higher level of care.

Assisted living questions? Get expert help

If you’re on a waiting list for an assisted living, memory care, or independent living community, ask for their standard contract so you have time to review it before space becomes available.

“Most senior living care providers will be happy to oblige,” said Furman, “because when you understand what you’re signing, you’ll have fewer disagreements and disputes in the future, which is a win-win for all involved.”

For additional assistance generating questions for prospective communities, take a look at the state of California Health and Human Services Agency’s sample assisted living contract. In addition to providing a good sample contract, it offers some useful information around the state regulations that dictate what communities must include in their agreements.

Finally, once you do sign the contract at your new community, make sure you get a copy and continue to reference it to hold your senior living care provider accountable to the agreements they’ve made with you.

If you are ready to take the next step in your search, the local Senior Living Advisors at A Place for Mom are experienced and can help you find senior living options in your area. They can also help assess your family’s specific situation to figure out the right fit for your loved one — all at no cost to you.