Understanding Edenwald’s Contract Options: Type A (Lifecare) vs. Type C (Fee-for-Service)
We believe everyone should have different options when it comes to planning their future, because every person has a unique financial outlook and vision for it. That’s why we offer contract options that provide both short- and long-term benefits for greater peace of mind.
Whether residents prefer the predictability of future healthcare costs or the flexibility of lower upfront expenses, they can decide what aligns with their goals—all while enjoying the security and support of a Life Plan Community. Here’s what you need to know about our contract types, entrance fees, and how to receive personal guidance from our team.
What’s a Type A (Lifecare) contract?
Our Type A (or Lifecare) contract is for residents who value cost predictability. Residents pay a higher entrance fee and monthly fee upfront in exchange for access to assisted living, memory care, and comprehensive nursing care at more predictable rates in the future.
This contract typically works best for those who want to plan ahead for potential healthcare needs, while avoiding significant changes in monthly expenses later in life.
Some characteristics of Type A contracts include:
- Predictable monthly fee regardless of the level of care
- Medical expense deduction
- Higher entrance and monthly service fees (as compared to Type C)
- Medical qualification prior to move-in
- Access to medical suite resources
- Priority access to all levels of care
What’s a Type C (Fee-for-Service) contract?
Our Type C (or Fee-for-Service) contract offers more flexibility and lower costs while living independently. Residents typically pay a lower entrance fee and monthly fee compared to the Type A option, while still maintaining access to higher levels of care.
If healthcare services such as assisted living, memory care, or nursing care become necessary later, those services are billed separately at market rates based on the level of care received. This option may be an ideal fit for individuals who have long-term care insurance, plan to self-fund future care, or prefer lower upfront costs altogether.
Some characteristics of Type C contracts include:
- Higher monthly costs if higher levels of care are needed
- Medical expense deduction only when at a higher level of care
- Lower entrance and monthly service fees (as compared to Type A)
- No medical qualification or denial based on pre-existing conditions
- Medical suite resources
- Priority access to all levels of care
What’s the biggest difference between Type A and Type C contracts?
While both contract options include access to Edenwald’s community amenities, services, and continuum of care, the main difference comes down to how future healthcare costs are structured. Type A contracts offer more predictable long-term healthcare expenses, while Type C provides lower initial costs with future healthcare billed separately if needed.
Types of services included in the contracts
No matter which contract option residents choose, monthly fees include a wide range of services and amenities designed to support a maintenance-free lifestyle. These include dining, housekeeping, transportation, wellness programs, fitness classes, utilities, security, home maintenance, and access to social and special educational opportunities.
How do the entrance fees work?
Entrance fee costs at Edenwald vary based on factors such as apartment selection, contract type, and the refund option chosen.
Edenwald also offers refundable entrance fee options, allowing residents to incorporate their personal financial and estate planning goals into their decision-making process. Residents may designate where any applicable future refund should be directed, whether to a beneficiary, trust, or estate representative.
For couples, refund calculations are based on both residents’ entrance fees, and refunds are issued after the contract has ended and specific agreement terms have been met.
What entrance fee plans are available?
There are two different types of entrance fee plans, depending on your preferences.
50-month declining entrance fee
With the 50-month declining entrance fee option, the refundable portion of the entrance fee decreases by 2% each month beginning in the first month of occupancy.
After 50 months—or approximately four years and two months—the entrance fee is fully earned and no refund remains.
If a resident’s contract ends due to withdrawal or death before the 50-month period is complete, a partial refund may be issued to the resident once the original apartment has been reoccupied and a new entrance fee has been received. For example, if a resident moves out after three months to be closer to family, Edenwald would retain 6% of the entrance fee (2% per month for three months), and the remaining 94% would be refunded.
80% refundable entrance fee
With this option, 80% of the original entrance fee may be refunded if the contract ends due to withdrawal or death. The refund is issued after the apartment has been reoccupied, and a new entrance fee has been received for the residence. This structure can provide additional flexibility and reassurance for residents and their families as they plan ahead.
Are monthly service and entrance fees tax-deductible?
Residents may qualify for annual medical expense tax deductions related to portions of their monthly and entrance fees, depending on IRS guidelines.
A resident must meet all of the criteria required by the IRS for a medical expense deduction. We recommend you consult with your tax professional to discuss how the deductions would affect your personal income tax situation.
Ready to speak to an expert or ask questions?
Choosing the right contract for you or a loved one is a personal decision that doesn’t have to feel overwhelming. Our Residency Counselors are here to answer your questions and help you better understand which option may best fit your future. If you’re curious or have questions, we encourage you to call our team at 410-339-6263.
