How much does health insurance cost in retirement?

[Snydley]

DH and I won't have pensions or options to carry work health insurance after we retire. Is medicare enough? How much is it? Will/should we supplement with something else?

We (we'll I'm) not retiring for 20+ years but I'm trying to figure out how much we will $$ we will need.

thanks

[TexasHusker]

In 20 years, you'll have health insurance automatically, through an additional tax on your income. Wouldn't worry another minute about that one.

[disneysteve]

Is medicare enough? How much is it? Will/should we supplement with something else?

No, Medicare is not enough, nor is it free. I'm sure you can Google and find out the current rate is. Medicare has a deductible and then covers 80% of expenses. You are responsible for the other 20%. But you can get a supplemental policy to pick up what Medicare doesn't. Also, you need a Medicare Part D plan to cover prescriptions.

There are many options for these things and the prices vary based on location and level of policy that you purchase. There are also things that Medicare doesn't cover at all that you would be 100% responsible for like certain meds or certain treatment options but that's much harder to predict or put a price on.

[clatoden99]

If you are over 65, you get Medicare insurance, which covers most, but not all, health needs. Many people buy supplemental health insurance to close up gaps in coverage.

If you retire before 65, you must buy your own insurance.

At any age, some lower income people may qualify for government insurance subsidies via the affordable care act, aka Obamacare.

[Snydley]

In 20 years, you'll have health insurance automatically, through an additional tax on your income. Wouldn't worry another minute about that one.

Ah, dare to dream!

Thanks for the replies. We are both currently healthy and in our 40s, but who knows what lies ahead. I will check medicare prices. It makes me feel like I should have at least a couple 100K more in the retirement funds for insurance, not that I can figure out exactly how much $$ we need in there in the first place. As much money as possible is the answer I think.

And dental insurance too, right? Ugh.

[disneysteve]

One recent study that was widely publicized said, "estimates that a 65-year-old couple retiring this year will need $240,000 to cover future medical costs."

[corn18]

I have seen the same question asked on bogleheads. The answers were a lot of "it depends", but near as I could gather from the folks that responded that were actually retired, I budgeted $12,000 / year for health care in retirement. The other variable is LTC. I looked at LTC insurance but that has gotten quite expensive and keeps going up, so I am planning to self insure. That means an extra $500k in the kitty before I can retire. Or plan to use the house to cover LTC.

This kind of thing makes it hard to determine when you've won the game. As it sits right now, if all goes well, my kids will inherit a boatload of money. If the market tanks the day after I retire, both of us require LTC and live to 90, we may not have enough. Oh, and what if SS changes? And my pension gets slashed or goes away? If I account for all the bad contingencies to all happen, I need $100,000,000,000,000 to retire. Ugh.

Tom

[disneysteve]

If I account for all the bad contingencies to all happen, I need $100,000,000,000,000 to retire.

I'm a simple man with simple tastes. I could retire just fine if you lop 3 zeros off of that number. I'm sure I could even scrape by if you knocked off 6 zeros but it would be a struggle.

[LivingAlmostLarge]

I think $12k/year is low for retirement health insurance unless you have Tricare or Medicare. If you are retiring before 65 it's hard to fathom the costs. You may qualify for subsidies, but a lot of insurance plans you buy SUCK with coverage. Lots of dr avoid you. Lots of problems fighting with insurance companies. I think even with supplemental I've heard that a lot of costs after 65 and medicare can also be generated by prescriptions.

[corn18]

I think $12k/year is low for retirement health insurance unless you have Tricare or Medicare. If you are retiring before 65 it's hard to fathom the costs. You may qualify for subsidies, but a lot of insurance plans you buy SUCK with coverage. Lots of dr avoid you. Lots of problems fighting with insurance companies. I think even with supplemental I've heard that a lot of costs after 65 and medicare can also be generated by prescriptions.

I am very fortunate to have Tricare for life as a retired military guy. Right now, I run about $3k / year in health care costs, so $12k / year in retirement is hopefully enough. If I didn't have that, the gap to Medicare would be a bear to cover.

For everyone that thanks me for my service, I thank them back. I am very blessed to have the benefit of a lifetime pension with COLA and survivor benefits along with health care for life for my wife and I. I am very proud of serving but I hope those that haven't don't feel like they don't support our troops. You do way more than you think and we very much appreciate it.

Tom

[VioletsMoney]

Retirement Medical Insurance

My husband retired four months ago at the age of 60. We were offered two options for our medical needs. #1 was Cobra insurance which we can have for 18 months maximum. $900.03 per month. #2 was a retirees insurance from hubby's work place. $1660.00 per month.

We chose the $900.00 monthly plan which is a continuance of our exact same insurance we had while he was working. We had been paying $200.00 per month, now we pay $99. per month. It is a high deductible insurance plan. So in other words, we pay for everything if we go to the doctor....we have no co-pays. We pay it all...... plus pay for the insurance......crazy

[FLA]

what about Medicare HMOs or advantage plans, as I've heard them called? My parents have those, I believe and seem to be doing fine and they are very high users of insurance.

I will be eligible for Medicare in about 18 mos. I have no idea where to start but I have a Dummies book on it so I'm GOLDEN (NOT). I have a lot of research to do

[Snydley]

This kind of thing makes it hard to determine when you've won the game. As it sits right now, if all goes well, my kids will inherit a boatload of money. If the market tanks the day after I retire, both of us require LTC and live to 90, we may not have enough. Oh, and what if SS changes? And my pension gets slashed or goes away? If I account for all the bad contingencies to all happen, I need $100,000,000,000,000 to retire. Ugh.

Tom

Well said.

OMG these replies are scaring me! I'm glad I asked. I am a professor at a university, and now I'm thinking that if I feel the urge to retire before 65 I'll just give up the research work and teach just enough to keep health insurance for DH and I. I like teaching so I probably won't mind, although in 20 years, who knows.

[Snydley]

Also time to get serious about 'lifestyle medicine'- a.k.a get DH back on his bike/working out.

[MakeAStash]

The numbers I'm hearing from friends for high-deductible health insurance are about $500 per month per person.