How to Make Health Insurance Part of Your Retirement Planning

HOW TO MAKE HEALTH INSURANCE PART OF YOUR RETIREMENT PLANNING

Health insurance should be as important as auto and homeowner’s coverage, if not more so. As an entrepreneur in the fields of finance and insurance, I’m always surprised when I work with professionals who haven’t considered the costs of their health coverage when they retire.

Equally concerning are estimates that the average 65-year-old couple can expect health care costs of more than $275,000 in their retirement years. Unless their retirement packages include ongoing coverage and they’re eligible for supplemental insurance, many people risk spending the bulk of their retirement savings on the aftermath of a major medical event.

With some careful planning, it's possible to avoid that dreary future and focus on enjoying retirement rather than the effect of potential claims on a fragile nest egg.

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Why Health Insurance Matters In Retirement

Wondering why health insurance should be a part of your retirement planning? Let me explain:

The future of healthcare is uncertain. With the proposed changes to mandated health insurance coverage and programs pulling back from the Affordable Care Act, Americans about to retire find themselves in a gray area for health insurance. Many don’t have coverage and are worried about choosing a provider amid such uncertainty.

Few companies provide health insurance in retirement packages. According to the Kaiser Family Foundation, employer-provided coverage won’t be as much help to retirees as it used to be. Its research indicates that only 25% of large employers even offer retiree health coverage, compared with the 40% of employers who offered it in 1999.

Additionally, the current administration’s intent to amend the ACA is clear, but the details of its plan to change federal insurance laws are not. For anyone nearing retirement, the potential impacts to insurance coverage and costs should be of special concern. For instance, the reintroduction of high-risk pools for pre-existing conditions could lead to declining coverage and higher premiums for many.