News release: “Senator Herb Kohl, Chairman of the Special Committee on Aging, held a hearing on continuing care retirement communities (CCRCs), which provide separate housing for seniors who are able to live independently, who require help in an assisted living facility, and who require more intensive care in a nursing home. The Committee examined issues of financial stability and potential risks to consumers who pay large entrance fees – sometimes representing their life savings – in order to join such communities. One witness discussed his experience as a resident of a CCRC that went bankrupt, resulting in the loss of his refundable entrance deposit…As part of the hearing, Chairman Kohl released an investigative report based on the responses received to letters of inquiry sent to five CCRC providers earlier this year. The Committee found many CCRC ownership structures to be very complex, and that financial troubles at any level can have real consequences for individual residents. Unfortunately, financial statements of a parent entity owner or owners are not always included or available in the financial disclosures of a CCRC. Evaluating the merits of a CCRC and judging the risk involved with this type of investment is extremely challenging for an individual consumer without professional assistance. As part of the report, the Committee developed its own checklist for state regulators who wish to expand or improve their oversight of CCRCs…Chairman Kohl also released a study from the U.S. Government Accountability Office (GAO), which found that regulatory approaches and the agencies responsible for the oversight of CCRCs vary considerably among states. In fact, 12 states do not have any CCRC-specific regulations. Consumer safeguards and protections regarding disclosure, asset reserves, and escrow requirements differ widely, and only 17 states require CCRCs to submit studies that assess their long-term viability. Finally, only 294 CCRCs (about 16 percent) are voluntarily accredited by the Continuing Care Accreditation Commission.”