Glossary

Level-of-Care Pricing Tier

Also known as: care tier pricing, points-based care pricing

A rate structure common in assisted living and memory care in which base rent for housing and meals is charged separately from a tiered or points-based care fee that scales with the resident's assessed ADL needs.

This bifurcated pricing model -- distinct from skilled nursing's typically all-inclusive per diem -- means two residents in an identical unit can pay materially different total monthly charges depending on care tier, and it is a key driver of 'ancillary' or 'care' revenue that underwriters must model separately from base rent growth, since the two components respond to different demand drivers (unit rent tracks local housing and competitive supply, while care-tier revenue tracks the community's aging-in-place resident population and acuity creep). Operators periodically reassess residents and 'tier up' pricing as needs increase, which is a legitimate and expected revenue growth lever distinct from headline rate increases, and sophisticated diligence separates the two when assessing the sustainability of historical revenue growth.