Wednesday, May 23, 2018
A Closer Look at Continuing Care at Home Contracts (Sometimes Known as Continuing Care Without Walls)
As I prepare for some summer writing and speaking projects, I've been taking a closer look at Continuing Care at Home (CCaH), sometimes also called Continuing Care Without Walls. Pennsylvania was among the early states to license CCaH providers, doing so under the Pennsylvania Department of Insurance's regulatory authority for Continuing Care Retirement Communities (CCRCs).
CCaH is something of a hybrid, contract-based product, sort of a combination of “home care agency” and “long-term care insurance.” The customer makes a prepayment for access to specific services, to be provided in the customer's own home, The services offered tend to emphasize care coordination; several different types of plans may be offered by a single provider.
From the providers I've reviewed, CCaH contracts typically have an upfront “entry” or membership fee, plus monthly service fees. In some of the plans there is also cost sharing and deductibles for services. Overall, the fees, as one would expect, are lower than for traditional CCRCs, but can still be significant.
For example, in a recent report I reviewed, one operation described a series of contracts available. One contract involved a 90% "refundable" entry fee plan. In 2012, a prospective member who qualified at age 88 could expect to pay an entry fee of $147,160, plus monthly service fees ranging from $290 to $584.
In some instances, the company may charge annual fees, rather than a single entry fee plus monthly fees. For example, another Pennsylvania CCaH provider offers "life care plans," "home care plans," and "traditional life care plans." The first two contracts have annual fees, while the third, "traditional life care plan," is structured with a single upfront entry fee, plus monthly fees of 1% of the entrance fee.
At that company, for the "life care plan" with annual fees, a prospective member could select a "life time benefit" of between 1 and 7 years, plus a maximum daily benefit of between $75 per day to $250 per day, with options for a waiting period, cost of living adjustments, and "shared care." As of April 2016, if a prospective member at age 80 chose a life care plan with a 7 year "maximum life time benefit," no waiting period, no cost of living adjustment and no shared care, he or she could expect to pay annual fees of around $7,880 for a $100 per day benefit -- or up to $15,60o per year for a $200 per day benefit. Fees would be discounted by 20% for two or more people per household and the benefits and annual fee "may vary based on the member's health status at time of enrollment." Further, the provider cautions, "though not anticipated, the annual fee for members of life care and home care plans may be adjusted after the fifth anniversary of their continuing care agreement," and any such adjustments would be on a uniform basis for all members in a specific plan.
In Pennsylvania, all of the current providers of CCaH are connected to or developed by operators of brick and mortar CCRCs, and therefore the CCaH contracts sometimes offer priority admission to the related CCRC if resident care is desired. I don't think this connection between a CCaH program and a CCRC facility is necessarily required in other states.
Traditional long-term care insurance has had a troubled history nationally and in Pennsylvania, CCaH providers seem to avoid that history by staying closely tied to the positive reputation of a visible, attractive brick and mortar CCRC. However, CCaH contracts do not necessarily promise to use the staff or services from the related CCRC, and if so, the CCaH provider may turn to third parties, such as home care agencies, in the search for workers. The contract terms are key and require careful reading.
Pennsylvania currently licenses five CCaH providers. The longest operating provider is Friends Life Care at Home, a not-for-profit operation in southeastern Pennsylvania. It was organized in 1985 and according to registration information at the Pennsylvania Department of Insurance it has approximately 2,500 contracts in existence. Friends Life Care recently entered into a joint marketing agreement with SpiritTrust Lutheran Life.
The newest entrant in the CCaH market in Pennsylvania is Meadowood Life Plan at Home, also in southeastern Pennsylvania. It offers a range of options, starting with wellness coordination, plus companion services, homemaker services, home health aides, licensed nursing care, adult day care, emergency response systems, supportive technology (such as “medication dispensing systems or motion detectors), and access to "primary care" services on the Meadowood Senior Living Campus (their brick and mortar CCRC) in Worcester.
The other licensed CCaH operations in Pennsylvania are Longwood at Home in western Pennsylvania; SmartLife via Willow Valley, a continuing care at home membership program in Lancaster, Pennsylvania; and Phoebe's Continuing Care at Home program, called Pathstones by Phoebe in Lehigh, Northampton, Bucks and Berks counties.
Pennsylvania isn't the only state developing CCaH concepts. According to a Senior Housing news report published in 2016, there were 29 such programs in existence across the nation with "more under development."
I welcome anyone who has studied these contracts, especially in other states, to send me more information on CCaH and Continuing Care without Walls. This topic will be discussed by a panel I'm on at the Pennsylvania Elder Law Institute, July 19-20, 2018.