Did You Know Medicare Doesn’t Cover These Costs?
Medicare celebrated its 50th anniversary in 2016. After being signed into law in 1965 and launched in 1966, Medicare was viewed skeptically by many Americans. According to a recent Washington Post article, many wondered whether the new program would offer quality health care coverage or if it would generate long lines of elderly patients at hospitals. Some wondered whether the program would even work.1
Today, Medicare is a valuable resource for retirees. It covers a substantial portion of the costs for hospitalizations, doctor visits and potentially even prescription drugs. If you’re approaching retirement, Medicare will undoubtedly be a part of your health care funding strategy.
Medicare doesn’t cover everything, though. In fact, you may find that even with Medicare coverage, you could still have substantial out-of-pocket health care costs. In a recent study, Fidelity found the average 65-year-old couple could expect to pay $260,000 for out-of-pocket medical costs.2
It’s important to be aware of which costs are and are not covered by Medicare so you can develop a funding strategy. The earlier you plan ahead, the more options you may have available. Below are three common health care costs that usually are not covered by Medicare:
Dental, Hearing and Vision
Since it’s relatively common for these three types of treatment to be covered under employer plans, many retirees find it surprising that Medicare does not cover them. Generally, though, they aren’t covered. Medicare may cover treatment if it’s related to a qualified health issue. However, don’t plan on Medicare paying for your regular dental or hearing checkups.
One potential strategy is to purchase a supplemental insurance plan that fills in the coverage gaps. You could also fund your health savings account while you’re still working, and then use the HSA to pay for your dental, vision and hearing costs in retirement.
Do your retirement plans include travel overseas? Do you plan on living some or all of the year in a foreign country? If so, you may want to investigate your health care options in advance. That’s because Medicare doesn’t cover treatment provided outside the United States.
If you’re relocating to a new country, you may qualify for health care provided by that nation’s government. Otherwise, look at private insurance policies that will protect you while you’re abroad. The last thing you want is to experience a medical emergency in another country without any coverage in place.
According to the U.S. Department of Health and Human Services, 70 percent of all 65-year-olds will need long-term care at some point in their lives.3 Long-term care is extended assistance with basic living activities such as dressing, bathing, eating and mobility. It’s often needed because of issues like Alzheimer’s, Parkinson’s, strokes, heart disease and more.
Long-term care can be costly, and it may be needed for years. Unfortunately, it’s also not covered by Medicare in most cases. It is covered by Medicaid, but only if you have few assets and little income.
You may want to look at purchasing a long-term care insurance policy, in which you pay premiums today in exchange for protection in the future. Most policies cover care provided either in the home or in a facility. Also, some have death benefits, so your loved ones will get any unused funds.
Ready to develop your health care funding strategy? Let’s talk about it. Contact us at Ambrose Financial & Insurance Services. We can help you analyze your needs and create a plan. Let’s connect soon.
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16294 – 2016/12/19