“What is the difference between a not-for-profit community and a for-profit community?” This is a popular question among prospective residents of Continuing Care Retirement Communities (CCRCs), also referred to as Life Plan Communities.

Many not-for-profit CCRCs are single-site organizations, although some are part of a larger group. The distinguishing feature of a not-for-profit CCRC, as with other not-for-profit organizations, is that all of the money earned or donated goes towards pursuing the organization’s objectives, instead of to the owners. Not-for-profit CCRCs are typically structured as 501(c)(3) organizations, which, by definition, requires that they operate for charitable purposes. Providing lifetime housing and health care services, even if a resident’s personal finances are depleted, is often core to that charitable purpose. Most not-for-profit CCRCs will maintain a foundation or endowment fund, which can greatly enhance the organization’s ability to provide such financial assistance.

Providing continued housing and services to those who have depleted their assets, due to no fault of their own, is a mission and not a guarantee. While the vast majority of not-for-profit CCRCs have been successful in fulfilling their mission, financial assistance is ultimately conditional on the community’s ability to provide funds while operating on a sound financial basis. In some cases, a community may even require that financial subsidies be repaid by the heirs or the estate at death.

By contrast, for-profit communities are often owned by a larger parent organization and are typically more profit-driven than charitably driven. This is not inherently bad because, after all, leaders of a quality organization know that there will be no profits if they do not offer a desirable product and look after their residents. And while a for-profit CCRC may be more inclined to ask a resident to leave if he/she is no longer able to pay, most operators understand that it is a good business practice to accommodate residents to the extent possible and do not want a reputation in the community of being uncompassionate. In fact, some for-profit CCRCs also maintain separate charitable funds to provide financial aid for residents.

In theory, the chances of a resident requiring financial assistance from the community should be relatively low, regardless of whether it is a for-profit or not-for-profit provider. This is because most CCRCs go through a financial qualification process with new residents. A thorough process will help ensure that there is a higher than average chance that the resident has enough money, under average circumstances. Furthermore, many providers offer a refundable entry fee, and in this case, if the resident runs out of money then his/her entry fee refund will almost always be used to offset health care expenses before any financial assistance will become available. Finally, for providers that accept Medicaid, residents may qualify for government assistance to cover health care expenses when they exhaust their funds.


As a non-profit CCRC, Scotia Village is proud to constantly reinvest in the community and residents we love. Whether it’s through renovations and expansions or new services and programs, we take our residents’ futures seriously. Not only is our campus a beautiful place to live, it’s a community to thrive in.

With a mission to serve seniors, we have established a fund that provides any resident, who has outlived their assets through no fault of their own, the same comforts, services, and amenities they have always enjoyed at Scotia Village without ever having to leave. It’s one of the many ways in which we’re proud to help make a difference in the lives of seniors throughout their retirement every day.

We welcome you to learn more about our community and organization by clicking here.


The above article was written by Brad Breeding of myLifeSite and is legally licensed for use.

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