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Tips for Finding Healthcare in Retirement


One thing many recent retirees are shocked to learn is that once retired, they may need to pay substantially more on a monthly basis for the same quality of healthcare they received while employed full-time. In fact, you may even pay more for less coverage than you are accustomed to. Health insurance planning is an oft-forgotten part of retirement planning. It requires strategic budgeting, and it may even influence the age at which you retire.

Most Employers Do Not Offer Retirement Health Insurance

You may be accustomed to the excellent healthcare provided by your employer. However, for a variety of reasons, most employers do not offer health insurance coverage in retirement. For most, the cost of insuring retirees is simply too much to maintain. If you retire before you are eligible for Medicare at age 65, you may need to cover the health insurance gap with Cobra insurance which may offer coverage for 18 months, during which time you are responsible for both the employee and employer portion of the monthly cost.

Even if your employer does provide retirement health insurance, there is no guarantee it will be extended for life.
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  • Medicare: You must be 65 years or older to qualify for Medicare. There are different parts of Medicare to enroll in, which cover inpatient hospital stays (Part A), some doctors' visits (Part B) and prescription drug coverage (Part D). The premiums for each part of Medicare vary depending on your income and need for prescription drug coverage.

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Long-Term Care Insurance

In addition to securing quality healthcare in retirement, you may also be weighing the pros and cons of long-term care insurance that would cover long-term care expenses that regular health insurance does not pay for if your or your spouse’s health takes a drastic turn for the worse. These plans vary greatly in cost, but more importantly, you must read the fine print before you buy this coverage. Otherwise, you may end up with a plan that makes you jump through hoops when and if it is needed. If you have a parent or grandparent whose long-term care insurance was impressive, don’t get too excited, as most plans offered today are far less inclusive.

Alternatives to Independent Healthcare Coverage in Retirement

Quality independent healthcare coverage is often over $1,000 per month per person. For most, this is more than you paid while employed. If you are banking on the alternative options, there is also quite a bit of gray area there as well:

  • Medicare: As stated earlier, you must be 65 years or older to qualify for Medicare. Then you have four primary plans to choose from, which vary greatly depending upon your desired coverage and monthly healthcare budget.

  • Medigap: Medigap insurance is independent insurance designed to cover the “gaps” of what Medicare does not cover. This is less expensive than full independent coverage, but still costly.

  • Affordable Care Act: The ACA currently provides retirees under the age of 65 the ability to access quality healthcare. While this is a new change, the ACA may not be a long-term option.

  • Medicaid: Medicaid is a low-income and/or disability insurance option, which not everyone qualifies for.

How Your Financial Planner Can Help

Planning for retirement must include a financial plan that takes medical expenses into consideration. Every retirement plan is unique, but the goals are similar: to minimize risk, maintain income in the event of illness or disability and to make informed financial decisions. Working with a financial planner ensures that you take a strategic approach to optimizing the money you save and that your retirement budget is realistic.

Regardless of what stage of retirement planning you are at, even post-retirement, Linden Oak Wealth Partnersis here to help you design a personalized retirement plan.

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The views expressed in this blog post are as of the date of the posting and are subject to change based on market and other conditions. This blog contains certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected.

Please note that nothing in this blog post should be construed as an offer to sell or the solicitation of an offer to purchase an interest in any security or separate account. Nothing is intended to be, and you should not consider anything to be investment, accounting, tax or legal advice. If you would like investment, accounting, tax or legal advice, you should consult with your own financial advisors, accountants or attorneys regarding your individual circumstances and needs. No advice may be rendered by Linden Oak Wealth Partners unless a client service agreement is in place.

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