Continuing care retirement communities in New Jersey must give funds back to residents’ descendants more quickly after the passage of a new law last week.
Gov. Phil Murphy (D) signed a measure into law Friday, aiming to benefit seniors and their families. Typically, when residents enter CCRCs, they must pay a move-in fee, with 90% of those dollars reverting to the resident’s estate after he or she dies.
Previously, CCRCs could hold onto the fees indefinitely, though usually released when a new resident movies into the unit. The measure was introduced after local media reported that a man’s deceased mother’s fee was “held hostage,” leading to a $90,000 loss for the family, NJ.com reports. The state senator who introduced the bill claimed that “greedy CCRCs” had held onto funds for far too long, and added that the “nightmare is over.”
Jon Dolan, president and CEO of the Health Care Association of New Jersey, said he is supportive of the measure and didn’t find it “threatening” to the field in any way, or “borne of any injustice or unfairness to providers.”
“It did not come with any big battles or horrendous stories for the industry or consumers,” Dolan told McKnight’s on Monday. “It just seemed to be in the interest of more transparency and fairness within the process, and equitable enough to both sides.”
Editor’s note: This article has been modified since it’s original publishing to correct an inaccuracy. CCRCs do not have to return move-in fees within a year, as that measure was removed from an earlier draft form of the bill. “Under the new law, when a resident vacates a unit and leaves a facility, they will be given a number and placed on a list in sequential order and as soon as the unit is sold, they will receive their refund based on their position on the list and the availability of funds from the proceeds of the resale of all vacated units with refundable entrance fees instead of waiting until the unit is sold,” according to Christopher Lee, vice president of LeadingAge New Jersey.