Retirement Homes Offer No Peace for Seniors
Regulation required to stop the harassment of those who have invested in retirement homes 
Once again, it is probably the judiciary that may come to the rescue of senior citizens who have invested their nest egg in retirement homes and end up fighting bitter battles with developers instead of the restful luxury they expected in their golden years. S Krishnamoorthy, an 80-year old air-force veteran, has filed a public interest litigation (PIL) asking the high court to direct the Tamil Nadu government to set up a specific regulatory authority to for senior citizens’ homes in the state. At the first hearing in September, a two-member bench, comprising Chief Justice Sanjay Kishan Kaul and Justice TS Sivagnanam, was sympathetic to his plea, despite a sketchy petition and directed the state government to file a proper response by 24th November. Irrespective of what happens in the case, there is no doubt that the senior citizens, who invest their hard-earned money for proper accommodation and facilities (in these private projects), are not made to run from pillar to post to get the services they were promised. 
Retirement homes are a niche new real estate market segment that has grown steadily over the past two decades by promising well-to-do Indians all their needs in old age – food, house-keeping, laundry, healthcare facilities, recreation and companionship of people of their age group. But the reality is often vastly different. Services and maintenance standards decline, costs escalate and the terms of the original agreement are changed with no recourse to the senior residents. Mr Krishnamoorthy’s petition arises out of his own experience and the tribulations of other senior citizens who opted to live in retirement homes that have mushroomed around the picturesque Coimbatore region of Tamil Nadu.
Is it enough for the Tamil Nadu government to create a regulatory framework for the state alone? With changing demographics, higher income in the hands of seniors, security concerns and the paucity of domestic help, well-run and regulated retirement homes and townships will be essential for future generations. In many cases, it will be the only way to ensure that a secure environment, companionship, nutritious food and geriatric care or medical assistance is available on a daily basis for those who can afford it.
It is the government’s responsibility to remove the regulatory vacuum in which retirement homes operate and put in place a clear framework to decide who can set up retirement homes, ensure fair and transparent contracts with seniors, proper supervision and swift grievance redress. This will require the ministry of social justice and empowerment to work with the finance ministry to put in place effective regulation. Unfortunately, this is easier said than done in a country where the National Policy for Older Persons (NPOP), framed in 1999, has yet to be properly implemented and we have no real estate regulator so far, because of the industry is controlled by land sharks and politicians.
Seniors will also have to face up to the reality that the concerns of well-to-do people are not a priority for any government. Even NGOs working in this sector are, correctly, engaged in mitigating far greater hardships and travails faced by the poor, destitute, infirm and abandoned seniors. While the Madras High Court has taken cognisance of Mr Krishnamoorthy’s plea, real change will require a proper framing of issues and advocacy at the national level with the appropriate ministries or even a class-action suit. Here are some of the issues that need thinking and clarity while framing such a policy. 
1. Who Can Set Up a Retirement Township/Homes: Unlike old-age homes that are run by charitable organisations, retirement townships are for senior citizens who can afford a certain lifestyle and amenities and are willing to pay for them. It requires deeper pockets and cannot be set up by charitable organisations/NGOs or as a family enterprise. Although realty is a state subject, the process of granting clearances to set up retirement homes and townships needs to have a national regulatory framework, under the ministry of social welfare. These should only be permitted when basics, such as access to specialised medical care, are available at a reasonable distance and security, access and communication are in place.
2. Minimum Assurance of Services: Regulations should specify the basic minimum services (security, food, housekeeping, laundry, maintenance and basic medical facilities, as well as recreation and exercise facilities run by appropriately trained and supervised staff) that need to be in place to set up a retirement project.  Decisions regarding the selection of service-providers, supervision, audit of expenses and cost escalation must be through a management structure that has adequate representation from residents, chosen through an election process. 
Anyone setting up a retirement home must be able to commit specified minimum capital to be able to ensure maintain and all the promised services for at least five years. There are plenty of documented cases where seniors have had a harrowing time because of poor catering, laundry or housekeeping services and the promised medical facilities and basic check-ups, which used to lure seniors, are quickly shut down. On the flip side, seniors will have to be prepared to maintain deposits to meet their monthly payouts and to cover emergencies and contingencies.
3. Structure of Agreements: Ideally, seniors must be able lease rooms or apartments in such townships with provisions for deposits (refundable and non-refundable components) with monthly payments for food, maintenance and other costs. India has a few well-run retirement homes on outright purchase but they are an exception. In several retirement homes around Coimbatore, retirement complexes have been set up by families but are positioned as not-for-profit societies. The apartments are given out on 20-year lease agreements, renewable for another 20 years. While the terms were well thought out on paper and seemed to ensure lifetime security for a senior, it turned out that these entities were not registered, making the lease agreement itself legally tenuous. Escalating land prices worked to the advantage of the promoters who were able to nudge tenants to leave through unreasonable escalation of monthly charges or poor service. The apartments were then leased again at higher rates. Several seniors caught in such a trap have filed a court case, but the judicial system in India is a slow and expensive grind. 
4. Costs, Supervision, Accountability, Audit & Redress: One retirement home in Tamil Nadu has forced at least 10 seniors to file lawsuits after they were threatened with eviction or being denied food and services, when things turned seriously acrimonious. Only a proper regulatory framework will ensure that seniors do not become the victims of such dirty tricks, instead of the peaceful retirement that they paid and signed up for and that residents’ representatives have access to accounts to ensure that cost escalation is fair and reasonable. 
5. Exit Option: The government must ensure that no senior is trapped into retirement homes by ensuring that there is a clear exit option in each contract. Ideally, retirement homes must only have a lease and deposit arrangement because of the high cost and restrictions of selling property in a retirement township. 
Putting in place a regulatory framework for retirement homes is not a very difficult task, since most developed countries have already been through this phase of development where seniors in nuclear families felt the need to move to retirement homes for the benefits they provide. In fact, this is a $260 billion industry in the US and growing; if run well, it will be an important market in India too. Pushing the government to set up an appropriate framework needs advocacy from influential seniors, to make it happen. No one else is likely to do the job for them. 
(Sucheta Dalal is the managing editor of Moneylife. She was awarded the Padma Shri in 2006 for her outstanding contribution to journalism. She can be reached at [email protected])
Proud Indian
4 years ago
Hi Ms.Sucheta Dalal, I wanted to know if you can let me know in order to start a retirement community which is gated with all facilities - what are all the approvals required & is there any particular government body which also takes care of issues or it is only the court which we need to approach. If you can give me an clear picture I will be able to give you more details about the scams happening in and around Tamil Nadu...
Ramakrishna Iyer Seshan
6 years ago
From R I Seshan,
Dear Ms. Dalal, Thank you very much for highlighting this issue. And of course thanks are also due to Shri. Krishnamurthy for initiating the case.Yes, I have read all the comments and I agree that we shoudl equally take a lead insead of depending only on the Government to do some thing. In this respect, I am glad to say, we, the owners of villas in such a Senior Citizens Welfare Home, have , during the past three years unearthed the fradulent means by which the promoter had managed to rope in clients and we have dragged him to the courts for not fulfilling the promised facilities, for not obtaining legal approvals from various statuatory bodies while constructing the complex, for breach of contract for running the facility as his fiefdom. But then, we do need the Government's support and that is where asking them to step in helps.My request to Ms. Dalal, is to follow it up regularly and I can promise that she would not lack support from all quarters.
Ananthanrayanan Ranganathan
6 years ago
Self and wife, super senior and senior citizens have been contemplating of moving into a Retirement Home in the next year or two.
This article comes as a wet rag to douse our hopes and aspirations.

Will our Governments, both at the Central and State levels do something to protect from/prevent exploitation!!
Sucheta Dalal
Replied to Ananthanrayanan Ranganathan comment 6 years ago
Do read our past stories on Retirement Homes. There are lots of things to be looked at, most importantly - dont go too far from you home and relatives.

Secondly, check out options, if you dont sink in all your savings in buying a home, there are some good options available.

Moneylife has done two cover stories on Retirement Homes in the past.
Dr Anantha K Ramdas
6 years ago
In response to TIHARwale, I may mention that in the case of Panchavati in Bengaluru, the costs are practically 50% of the Coimbatore homes; except that this is not a profit oriented biz enterprise and is actually a cooperative. In fact, the admission is subject to one being able to buy a piece of land (which is part of the Vakil's gated community complex) and build your own house. Cost of food expenses are shared by the community and pure vegetarian food is served.

Karpakarajan may find this typically a south indian atmosphere and I have spent some time there, enjoying their company and food which is excellent and healthy, some of the items being grown by themselves.

Until you build your own facility, if they have space they would be able to offer the same. As mentioned in my letter, I will be glad to assist Karpakarajan if you need my assistance as a social service.
6 years ago
Thanks all for your comments.
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Replied to MDT comment 6 years ago
ok u have deleted the phone numbers definitely you could have left the website address as one of the readers wanted
Meenal Mamdani
6 years ago
An excellent article and also very timely.

My only disagreement with the article is that Ms Dalal expects the govt to take the lead in this effort.

The quality of governance is so poor that waiting for a govt body to research the issue and proffer solutions is futile.

India needs a more can-do attitude among the middle class. An independent and dues paying organization with salaried executive should do the legwork and lay out the frame of such an entity.

In India middle class retires in early 60s. With technology facilitating research and collaboration, surely such an organization can blossom in urban centers around the country. It is amazing to see how much AARP has achieved in USA. Surely we Indians can do similar or even better things.
Replied to Meenal Mamdani comment 6 years ago
regulation has to be sponsored by Government. Who else has the mandate!
Dr Anantha K Ramdas
6 years ago
I think it is time Government proposes a system of collecting a percentage of salary, very much like the provident fund or pension to be ear marked by the Company concerned to build retirement homes for its employees. They should also make a equal contribution and if the employee chooses to retire and living in these homes, it should be welcome.

for such a move, it is necessary that the State government provides land, on a 99 year lease to the company, so that such Old people's homes are built and run by the Company for its staff. These should be professionally managed and the retiring staff in these homes can be in the Managing committee of such Homes to ensure that best possible service is obtained.

Now a days, children tend to branch off on their own and leave the ageing parents to fend for themselves. Such being the case, it is necessary that Government sets up a Regulator to establish rules that would govern such enterprises which are now being set up by businessmen with the sole purpose of making profits.

In Bangalore,one of the best run Old people's home is Panchavati. A few months ago Moneylife carried out a detailed story on this institution. I have recently visited the place and would recommend anyone to visit this place to make up their minds.

Any interested reader can get in touch with me via the Moneylife for more details.
Dr M.Chandrashekhar
Replied to Dr Anantha K Ramdas comment 6 years ago
Dear Dr Ramdas,

Merry Christmas. Iam from Bangalore & am interested in Panchavati. Could you pl. send relevant info to my Email ID:[email protected]
Thanks & Regards,
Dr M.Chandrashekhar
Replied to Dr Anantha K Ramdas comment 6 years ago
Similar facilities in outskirts of Coimbatore come on terms somewhat like this

Refundable non interest bearing deposit of Rs 6 Lac when one relinquish the embership.Monthly towards accommodating for TWO members,veg,food,house keeping,maintenance etc Rs 16500/per month.Each cottage has a bedroom 17/12,living room 10/10,pantry,6/6,veranda 11/9,overhead storing space. At the pantry you may use micro oven,induction stove,electric kettle but gas cooking not allowed due to chances of accident. Cottages have independent E.B meter,hence E.B.charges ,phone,laundry,medicines etc will be extra at actual.
SINGLE ROOM: Deposit 4Lacs.Monthly charges Rs 7500. E.B charges etc will be extra at actual
Replied to TIHARwale comment 6 years ago
thanks for the information; can you give details of the service provider; if you dont mind.
Peruvemba Subramanian Ramachandran
6 years ago
In the ownership scc the ownership of the common properties should be mandstorily transferred to thr assn of owners and the promoter can only be a service provider at the choice of the owners at arms length. The govt should make this mandatory like in the Maharashtra coop Societie act or the Tamil Nadu
Apartment ownership act and the separate authority of
State and centre combined should monitor them after compulsory registration of sr citizens home under a common central act.
Gopalakrishnan T V
6 years ago
This is another field exploitation of retired and seniors is perpetrated all over the Country taking advantage of weaknesses of the old age, their mental and physical helplessness in particular. By and large, this field has become a very big business opportunity and extracting mmoney from oldies in the name of old age helps social and emotional care. By and large greed and having an eye on the money make many to enter the field and being a social and a charitable type of entity, no serious view is taken on them and there cannot be said to be any regulator to over see their activities and what they reall do ? Money is the main consideration behind many an old age homes and very few are rendering real and serious service to the weak and old. Without sufficient monney and wealth, these old age homes do not entertain any is a reality.
Ralph Rau
6 years ago
One serious lacuna in the concept of a retirement home likely cannot be addressed through legislation.

A personal acquaintance has set up a 500 acre retirement "ranch". Admission is based on a one time payment of INR 6 lakh. This covers board and lodging for life. The "ranch" will ensure that reirees are actively angaged including in simple physical activities according to their mental and physical capacity. The adequate land holding will allow floriculture and horticulture. The "ranch" will also achieve economic viability by having rustic resort like facilities for city based executives to unwind on week-end retreats with their families. Residential retreats for management executives will also yield revenues.
All in all a perfect balance of activity within tranquil rustic surroundings.
There is one catch though - residents MUST admit themselves before their 60th birthday. This will allow them to actively participate and build mutually re-inforcing friendships for life - the one-two-three decades - the golden years. The "ranch" must be their primary residence and they are free to make visits to their families elsewhere. The greater part of the year must be lived at the "ranch" to demonstrate their commitment to their new community.
Replied to Ralph Rau comment 6 years ago
thanks for the information; can you please provide details of the service provider, if you dont mind!
Ralph Rau
Replied to karpakarajan comment 6 years ago

Being a registered charitable trust it is not for profit. It is set up by a couple of Christian gentlemen. So while the concept of viability and self sufficiency is great this may pose a challenge to those who have other religious inclinations with no temple or mosque on the premises ?
Hopefully some charitable souls will set up a similar concept for aatheists ?
6 years ago
It is a sad situation for our seniors who have worked so hard .They should not have to be put to such trouble .The TN CM should do something as a initiative for other states , AMMA DAYCARE .
Sunil Rebello
6 years ago
Retirement Homes: It is never a possibility to run a Retirement Home as a business and worse still if you have an ulterior / selfish motive.

Retirement Homes: can run only where people running them have the Charism / self dedication to give their lives to the service of Elders.

even when taking care of Elders at home we can see the feedback from them, due to the memory loss and body deterioration.

running Retirement Homes is never easy and never cheap. the older you get the harder it is to keep up your health and wealth
R Balakrishnan
6 years ago
Law is unlikely to help. Service is something that is provided by someone. By legally compelling someone to do it, it does not happen.
This is hard core real estate business. Once the property is sold, end of interest for the builder. And who wants to help old people? It is a sad thing in this country, where family values have collapsed. The fast paced life means that children do not have time for you. Migrate if possible.
Vaibhav Dhoka
Replied to R Balakrishnan comment 6 years ago
It is rightly said once the property is sold in case of dispute one has to take umbrage of judiciary which in most case is delayed as ever.
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