Lessons from SpiritTrust Lutheran and Beyond
When NaCCRA first launched the Finding Stability webinar series, the goal was to equip residents of Continuing Care Retirement Communities (CCRCs) with tools to understand governance, evaluate financial risk, and prepare for the unexpected. The September 17, 2025, session had been in planning for months, but just days before the event, news broke of severe financial stress at SpiritTrust Lutheran, a multi-campus provider in Pennsylvania.
The organizers quickly decided to make SpiritTrust a focal point for this year’s discussion. For the discussion, Katherine Pearson, Professor of Law at Penn State Dickinson Law and one of the nation’s foremost authorities on CCRC contracts and regulation joined actuary A.V. Powell, whose pioneering work has shaped risk analysis for CCRCs for decades; and Yvonne Troya, Clinical Professor of Law at the University of California, widely recognized for her expertise at the intersection of law, clinical medicine, and senior living policy.
As other participants joined the call, there was friendly conversation and informal greetings, but everyone seemed aware that this program carried special weight. SpiritTrust’s challenges—declining occupancy, pandemic aftershocks, and strained cash flow—are problems familiar to many nonprofit CCRCs. Auditors had flagged concerns as early as 2023, but the warnings were not widely understood. The webinar team wanted to show how residents can recognize early signs of trouble and engage with management before a crisis develops.
Katherine Pearson began by briefing the audience on the legal context. Powell and Troya, both experienced presenters, yielded time so she could lay out the framework clearly. Pearson explained that “the contract is king,” but residents must read beyond the bold promises in the opening pages. “The provider’s ‘outs’ are often buried in the fine print or hidden in handbooks referenced at the end,” she said.
She encouraged participants to ask whether their contracts permit unilateral changes to services, whether refundable entrance fees are tied to resale of a unit, and whether state law requires reserves or sets a repayment priority for refunds. She then addressed what happens if a provider becomes insolvent, explaining the difference between cash-flow and balance-sheet insolvency and outlining the Chapter 11 process. “Chapter 11 is not the end of the world,” she said. “It’s a process designed to reorganize and keep the doors open — but only if residents are at the table.”
Yvonne Troya concluded the presentation by focusing on what residents can do. She spoke briefly, but her message was clear and concise. “We’re seeing a move toward ‘repayable on resale’ and away from truly refundable entrance fees,” she said. “An investment banker told me she would be surprised if any CCRCs were offering fully refundable contracts anymore.”
In her slides, which were prepared for the presentation but not used during the broadcast, Troya urged residents to maintain accurate records (including marketing and other documents), stay informed about state regulatory protections, and actively engage with their Resident Council. She encouraged participants to connect with peers in other communities and to engage with state and national associations. “Resident voice equals resident power,” she said, summarizing her call to action.
The questions that followed showed how seriously the audience had taken the presentations. Participants asked how to access financial dashboards, how refunds are handled during bankruptcy, and whether residents should push for stronger state laws. Pearson stressed the importance of documenting communications with management and regulators. Troya reinforced the need for collective engagement to make residents’ concerns visible.
The discussion left participants with a sober but hopeful message: transparency must be routine, not an emergency measure; understanding contracts and state law before a crisis can make a decisive difference; and early signs of trouble—such as falling occupancy or delayed refunds—should prompt questions and engagement. Most of all, residents who work together through councils and associations can play an active role in safeguarding the stability of their communities.
The full slide decks from Pearson, Powell, and Troya are available here (click) for those who want to review the details. Together, they form a practical guide for residents who want to move from being passive recipients of information to active participants in their community’s future.
[Revised 9/22/25]