The economic downturn had a negative impact on segments of the Continuing Care Retirement Community (CCRC) industry in Ohio, says a report released this week by Miami University's Scripps Gerontology Center. About one-quarter of CCRCs faced challenges and reported using a broad range of business practices to try to remain viable.
The report, “Ohio CCRCs in the Economic Downturn,” notes that CCRCs are preferred by people who want to plan ahead for possible future dependency and increased health care needs. CCRCs provide a continuum of care for older adults, from independent living to nursing home care. Generally, older adults moving to CCRCs use proceeds from the sale of their homes to finance the move. With home values and sales toppling, retirement communities nationwide have faced difficult prospects, with several reports citing declining CCRC occupancy overall since early 2007.
In the Scripps survey of 165 CCRCs, the authors found that Ohio’s CCRCs were impacted differently by the downturn. At the end of 2009 about one-quarter had less than 75 percent occupancy in their independent living units, while 13 percent of facilities remained 100 percent occupied. Not-for-profits posted average occupancy rates of independent units of 84 percent while for-profits experienced 78 percent occupancy.
More than one quarter of CCRCs reported that many prospective residents told them they were waiting for the economy – and the values of their homes – to rebound before moving into a CCRC.
Most CCRCs that were surveyed adapted to the concerns of prospective residents by implementing, on average, four new business practices. These practices most commonly included retraining marketing staff, assisting with moving costs, working with realtors, discounting monthly fees and adding new types of residential contracts.
However, one-third of CCRC respondents indicated that they made no changes to their practices at all.
The report, authored by recent gerontology doctoral graduate Samuel Mwangi and Jane Straker, senior research scholar at Scripps and adjunct associate professor of gerontology and sociology, contains additional information about Ohio CCRCs, concerns of prospective CCRC residents, and comparisons among facilities with different occupancy levels and ownership.
The work was supported by the Ohio Department of Aging and the Ohio Long-Term Care Research Project. The study is available online.