The New Retirement Resorts

Instead of moving his mother into an assisted-living apartment three years ago, Eli Portnoy rented condos for both of them, two floors apart, at Canyon Ranch Hotel & Spa in Miami Beach, Fla.

His mother received many of the same services and amenities that would have come with an assisted-living facility—on-site doctors, healthy meals, a gym and all kinds of wellness classes—but in a far more appealing setting.

The kicker? Mr. Portnoy, a 57-year-old branding consultant, estimates that he saved $50,000 to $75,000 a year—even including round-the-clock private nursing aides—over what he would have paid for an assisted-living apartment luxurious enough for his mother, a retired New York art dealer who died in December at age 90.

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A growing number of intrepid retirees, wary of spending years in an assisted-living facility or staying at home, are opting for arrangements that provide them with a full range of services and a greater sense of adventure—fully staffed homes in Costa Rica, backyard bungalows on their children's property, so-called cohousing arrangements, full-time spa living and even serial cruises.

Assisted living emerged in the 1990s as a popular alternative model to nursing homes for older people who no longer felt comfortable on their own but were too independent for a nursing home. An estimated 733,200 people in the U.S. lived in an assisted-living facility as of 2010, the latest data available, according to the American Health Care Association's National Center for Assisted Living.

Typically, assisted living consists of a small apartment with services that may or may not cost extra, such as medicine management, personal care, housekeeping and laundry, meals, activities and transportation to doctors' appointments.

Now, some pioneers are piecing together similar services on their own in a setting more to their liking—often with help from their adult children—and at a price comparable to or cheaper than an assisted-living apartment. A one-bedroom unit in an assisted-living facility cost as much as $9,500 a month in 2011 before any add-on services, according to long-term-care insurer Genworth (GNW).

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Of course, coming up with your own plan for care requires a lot more work than simply writing a check to an institution. Finding paid help you can trust takes time, legwork and background checks—and there are no guarantees. The total costs can be hard to pinpoint in advance. It is tough to pull it all off without the vigilance of a good advocate, typically an adult child.

On top of that, getting a long-term-care insurance policy to pay your care expenses could take some negotiating. Still, they should generally be covered, as long as you need help with at least two daily-living activities, such as dressing or bathing, or cognitive care. Additionally, many newer policies have language about covering "alternative plans of care" that are developed in the future, says Rona Loshak, a long-term-care insurance broker in Roslyn, N.Y.

There aren't data available on how many people are foregoing conventional living arrangements in retirement, but experts in the field confirm the trend is growing and is likely to expand as 77 million baby boomers—more likely to identify assisted living as an option for their parents—head into old age.

"People are getting more creative in how they're spending their senior years," says geriatrician Lee Lindquist of Northwestern University's Feinberg School of Medicine. Even as they start to develop medical problems, "they don't want to spend their time in one room every day."

For those who prefer to follow their own path, here are several alternatives.

Going offshore. Americans have been retiring abroad for years, but going abroad for long-term care is relatively new. One of the pioneers was Bob Preston, a retired CPA and actuary in Sarasota, Fla.

For $3,500 a month, Mr. Preston rented a home in Costa Rica for his ailing father a decade ago, shared with two other patients. The price included a supervising nurse, three aides, a care coordinator and a chauffeur.

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"We had tried everything in this country," Mr. Preston says, such as an assisted-living facility that cost $8,000 a month, including private help. He was frustrated by the lack of attention being paid to his father, the retired chief financial officer of a large pharmaceutical company.

For less than half that, his father was able to live in relative luxury in Costa Rica. He attended church on Sundays, took a group to brunch afterward and went out to dinner several times a week.

The arrangement lasted for three years, until Mr. Preston's father died in 2001. Mr. Preston says that even including his monthly visits, the costs were much lower than long-term care would have cost in Florida. The flight from Connecticut, where he lived, took four hours and 20 minutes, just an hour and 20 minutes more than flying to Florida.

Mr. Preston concedes that he had qualms at first. For the first month, he hired a bilingual caregiver from the U.S. to be on the scene. He checked every reference he could. He contracted with a local secretary to pop in unannounced.

It worked so well that he was making plans for his mother, long divorced from his father, to go there after she suffered a broken hip last year. "We tried a nursing home for six weeks in a five-star place," he says. "But she disliked it." His mother died in February, at age 92, while he was planning the move.

One of Mr. Preston's friends followed his lead, moving her mother to Costa Rica, where she lived until she died.

Yes in my backyard. Many older people want to be with their families when they start to need help with daily living. But disagreements about where to set the thermostat, TV volumes and curfews for teenage grandchildren can make life difficult.

For such families, several companies are developing cottages that either an older adult or an adult child could use as separate living quarters in the other's backyard. Ken Dupin, a minister in Salem, Va., developed so-called MedCottages with help from Virginia Tech researchers after studying family-managed care in other countries.

A MedCottage, which costs about $85,000, has a 12-by-24-foot living area with a handicapped-accessible bathroom, kitchen, hospital bed and living area, and is outfitted so that the person living there can be monitored online.

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One of the bigger challenges: getting building permits. Mr. Dupin's company, N2Care, and its distributor worked to get a Virginia law passed two years ago that stops local governments from keeping out the structures as long as the family has a doctor's prescription and meets lot requirements, he says. Now, several more states have approved or are considering similar statutes.

Socorrito Baez-Page, a doctor who has spent a number of years caring for her elderly parents in Fairfax County, Va., has been working through the permit process to install a MedCottage for her 86-year-old mother. Her mother has been living in her home since January, but has trouble getting up stairs to bathe.

"Having a cottage in the backyard will help," Dr. Baez-Page says. "There will be a little bit of definition between here and there."

Cohousing. These arrangements, which originated in Denmark decades ago, were designed for anybody interested in living communally. In a cohousing development, residents live in private homes but share a central "common house" with a kitchen and other facilities.

Now, "senior" cohousing is starting to catch on as well, with four such projects already built in the U.S. and many more expected to follow. (You can find them at seniorcohousing.com). By 2020, there should be at least one cohousing community in every metro area, or 235 developments, and about one-third are expected to serve older adults specifically, says Charles Durrett, a Nevada City, Calif., architect who is promoting the concept.

ElderSpirit Community in Abingdon, Va., one such community, was built in 2005 and features 29 cluster homes and apartments with prices in the $160,000 range. Founded by former nuns, it is nestled in a high valley between two mountain ranges and along the Virginia Creeper Trail, a 34-mile-long path that offers a place to walk or bike.

Richard and Linda Brumleve, a retired English teacher and research analyst, moved in five years ago, drawn by the focus on spirituality and the beautiful scenery. After Mr. Brumleve, 73, was diagnosed three years ago with Parkinson's disease, they decided to stay. He can still go fly-fishing along the shore, and he paints in an artist's studio on the common house's second floor, reachable by elevator.

The permanent cruise. A number of years ago, Dr. Lindquist of Northwestern met some older travelers on a Caribbean cruise who had essentially retired on water—even though they shared the same sorts of health problems as her patients living in assisted-living facilities.

That gave her the idea to compare cruise-ship living to assisted living. She concluded in a paper published in an academic journal in 2004 that the costs are about the same, and many of the amenities and services line up as well: dining, escorts to meals, help with medicine and housekeeping.

In between trips, they might stay with family, or in a hotel.

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Ralph Ponce de Leon, a 78-year-old retired Motorola executive who lives in Phoenix, spends at least one-third of every year seeing the world aboard Carnival's Holland America line with his wife Kathie.

On their first cruise with the company, he says, he was surprised to see a number of passengers in their 90s, including a 92-year-old from the U.K. who told him she had taken 18 world cruises, which can last as long as four months.

One big advantage on a cruise ship: "You have a 24/7 physician and nurses," while doctors aren't always on-site at an assisted-living facility, Dr. Lindquist says.

It isn't clear how many people already are living on cruise ships full-time, but more than 400 people reached out to Dr. Lindquist after reading her paper, she says—many of whom planned to attempt it. The costs between the two choices have remained roughly the same since, she says.

Spa living. Mr. Portnoy of Miami Beach isn't the only person who used a spa instead of an assisted-living facility. Melinda Minton, executive director of the Spa Association in Fort Collins, Colo., says others are beginning to connect the dots.

One reason: Spa resorts increasingly are trying to expand into residential communities, "so you have people typically your age and in the same phase of life as you are," she says.

Meanwhile, Mr. Portnoy says, a friend's mother recently moved into Canyon Ranch, and he has talked to more people who live at the resort part-time, or have vacationed there, and are considering similar arrangements with their own parents.

For other adult children considering such a move, he cautions that there were times when he felt he was in over his head, particularly in hiring nursing aides. But Canyon Ranch's medical and wellness teams "couldn't have been more supportive," he says. "They embraced me in what I was trying to do."

Of his mother, Mr. Portnoy says, "I think she lived much longer than she would have if she'd been in an institution."