Preparing for retirement entails a variety of expenses, with some of the most substantial coming from medical services. A new report on medical bills from the Kaiser Family Foundation sheds some important light on this topic. According to a study released by Fidelity Benefits Consulting, a 65-year-old couple retiring in 2014 will need an average of $220,000 to cover medical expenses throughout retirement. However, this amount does not account for over-the-counter medications, most dental services and long-term care. Kaiser’s new report, “How Much Is Enough,” examines spending among Medicare beneficiaries and the medical services that account for most out-of-pocket spending and some important trends in out-of-pocket spending.
Of all the figures presented in the report, there are a few that are of significant importance. For example, Medicare beneficiaries in 2010, the most recent year of data available, spent an average of $4,734 out of their own pockets for health care, with the largest portion (42%) going to premiums for Medicare and insurance. Further, it should go without saying that remaining healthy later in life can help to save a lot of money. For those who are in poor health, average out-of-pocket spending on services is 2.5 times greater than beneficiaries who are in excellent health. In terms of hospitalized beneficiaries, readmissions are quite costly. Patients with a hospital readmission within 30 days of discharge spend about $1,200 more on services than those with a single inpatient stay. Given these monumental costs for healthcare in retirement, it is vital that you prepare for the extensive costs of medical services and do all that you can to stay healthy.
Tags: fidelity benefits consulting, kaiser family foundation, MarketWatch, medicare, retirement
