Even for individuals with excellent coverage and a good financial position, the prospect of major health issues are terrifying. There are good reasons to be afraid. The Fidelity Investments company has calculated that a typical 65-year-old couple who are scheduled to retire in 2017 must have a minimum of $275,000 if they want to cover all medical expenses and healthcare costs all through their retirement life. In 2016, the estimate was less -about $260,000. According to Adam Stavisky of Fidelity Benefits Consulting, the uncertainty across healthcare landscape means that individuals must educate themselves on the steps they could take to prepare themselves for meeting healthcare needs post retirement. It is a given that such expenses will only increase with time. It follows that people should include healthcare as a major part of the retirement plan.
Fidelity has included into their calculations a number of factors like premiums, out of pocket expenses, and cost sharing provisions. Parts of Medicare like A, B, and D are also included. As per Kelli B. Grant, associated with CNBC, this budget does not include over the counter medications and dental services. Long-term care is also excluded. The estimate also makes the assumption that you get to retire only at 65. This coincides with the eligibility for Medicare. A large number of workers expect to remain working even after that. They tend to retain their employer-sponsored coverage to reduce their expenses. If anyone retires prior to reaching 65 years of age, then costs would go up. The latter happens as individual coverage is needed in the marketplace to satisfy that gap.
As per Kaiser Family Foundation engaged in tracking the trends prevalent in the employer-sponsored health coverage, it is being observed that there is a notable downswing in the share of the big employers providing retiree health coverage. The numbers say it all. In 1988, about 66 percent of the employers offered this advantage. In 2015, only 23 percent gave their employees this much needed financial bonus.
When it comes to retirees, the supplemental coverage limits sponsored by the employer restricts the costs the employee will incur for medical care. Many people tend to believe that they can subsist on social security alone. A few people are even successful at it. These people more often are found to live in subsidized housing. Many of them are also eligible for food stamps. Most of such people live alone.