How to Pay for Healthcare in Retirement
These days, many people are putting off retirement and choosing to work past the retirement age of 67. One of the reasons many people do this is so they can keep the access they have to health insurance through their employers. Sticking with an employer's health plan is often less expensive and more comprehensive than Medicare or personal health insurance plans that retired individuals might buy on their own. There is coverage to be found in retirement, however. Pay for healthcare in retirement by choosing a Medicare plan if you are eligible, using any coverage still provided by your former employer or shopping for a comprehensive personal health insurance plan.
Finding Health Insurance in Retirement
Review your employee health plan.Some companies continue to provide health benefits to their retired employees, but this is becoming rare. If you do have the option to continue coverage, it may be expensive.
- Read the fine print. Once you retire, you may be able to continue participating in the employer's plan, but you may have increased premiums and more out of pocket expenses than when you were employed.
Sign up for Medicare when you are eligible.Most people can apply for Medicare 6 months before you turn 65, so you begin receiving Medicare benefits on your birthday.
Pay for out of pocket Medicare costs with Medigap insurance, which is a supplemental insurance plan offered by insurers to Medicare consumers.
Use these policies can cover co-pays, prescriptions and other out of pocket expenses that are not covered.
Shop for personal health insurance plans if you are too young for Medicare because you retired from full time work early.
- Talk to national insurers such as Humana, Blue Cross and Blue Shield and Aetna. They have health plans available with low monthly premiums. The plan you choose will depend on your health and budget.
Apply for Medicaid if you have limited assets.Medicaid is federally and state funded health insurance for people with low incomes.
Contact the Veteran's Administration (VA) if you were in the military.Most veterans are eligible for healthcare services through the VA.
Paying for Health Insurance in Retirement
Maintain a modest income.Working part time or as a consultant when you retire will give you money to pay for your premiums and out of pocket expenses whether you are on Medicare or have a private plan.
- Have a tax planner or financial specialist help you determine how much you can earn without making yourself ineligible for programs such as Medicare and Social Security.
Budget your Social Security, pension or retirement income.You will need to dedicate some of that income to paying for your health insurance and covering ineligible expenses such as co-pays and deductibles.
Use your home equity.If you plan to stay in your home and your mortgage is paid off or almost paid off, you can take a home equity loan or line of credit to help cover healthcare costs, especially if you are faced with a large and unexpected medical bill.
Use social networking and crowdsourcing to raise funds for expensive healthcare procedures.For example, if you have an expensive surgery or cancer treatment and you cannot afford the co-pay, prescriptions or other costs, friends and family can raise money for you.
- Check out sites such as YouCaring.com, Fundly.com and GiveForward.com. You might be able to afford your healthcare just by asking for help.
Seek care from low cost community clinics in your area if you have no money for healthcare costs and you are uninsured and ineligible for Medicaid or Medicare.
- Be proactive with your health. Eating right, getting daily exercise and avoiding tobacco and excessive sun and alcohol is a good way to keep your healthcare costs low.
- Use resources for retired people, such as the American Association of Retired People (AARP). Another popular retirement resource includes The Retirement Cafe, an online community.
Video: Paying for health care during retirement
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