Continuing care retirement communities: repayable contracts

The law gives residents clearer information and payment rules when their entrance-fee repayment depends on a queue of terminated contracts. It also requires providers to keep funds for those repayments in a separate account.

What the law does ​

• Renames the existing resale-based arrangement as a “repayable conditioned on resale” contract and defines “repayable contract” to include resale-based and sequential-order contracts.
• Requires providers offering sequential-order contracts to assign each terminated contract a repayment number and pay entrance-fee amounts strictly in termination order.
• Requires a separately accounted-for sequential repayment account, held exclusively for residents or their estates and funded by entrance fees from reoccupied units with sequential-order contracts.
• Requires sequential-order contracts to disclose recent repayment wait times, the number of contracts entering and paid from the account, and that payment depends on queue position and available account funds.
• Requires resale-based repayments within 14 days after resale or reoccupancy, and sequential-order repayments within 14 days after the account has enough funds for the contract’s assigned number.
• Preserves interest rules for unpaid repayable amounts and applies them to eligible sequential-order contracts without changing their payment priority.

Who it affects ​

• Continuing care retirement community providers that offer or maintain repayable entrance-fee contracts.
• Residents and estates entitled to repayment of entrance fees after a contract ends.
• Prospective residents considering contracts with repayable entrance-fee terms.