4 Steps to Reducing Health Care Costs in Retirement

By Gary Webb

Health care costs will be the biggest expense for most retirees. It’s not a pleasant prospect, but it is a reality.  A 65-year-old couple that left the workforce in 2017 will spend an average of $275,000 to cover medical expenses through retirement, according to the latest retiree health care cost estimate provided by Fidelity Benefits Consulting. That’s a 5.8% increase from 2016. 

Let’s take proactive steps to deal with the challenges. Here are four ways to help put yourself in the driver’s seat on health care.

1. An apple a day. We all learned that adage when we were kids. We all appreciate our physician who is happy to see us when we need care, but our doctor also finds joy when we own the preventative measures that are suggested. Stay  active, remain social, exercise regularly, eat well, and do your best to stay healthy and out of the doctor’s office. It will save you money and increase your sense of well-being.

2. Medicare won’t cover all expenses. There will be out-of-pocket expenses so consider a Medicare supplemental plan, sometimes called Medigap, which may pick up some of the extra costs. Prices will vary depending on benefits. While there is an outlay of funds to secure the insurance, it can help prevent nasty surprises and pick up the slack where Medicare Parts A (hospitalization) and B (outpatient and physicians services) end.  Another option is called Medicare Advantage, which allows you to purchase an all-in-one managed care plan that  includes Part A, Part B, non-covered costs, and may also include Part D (prescription drug coverage).

3. Don’t overlook the obvious. Falls are a threat to the health of older people and may reduce their ability to remain independent. More than 95% of hip fractures are caused by falling, according to CDC data from “Important Facts about Falls.” Falls are the most common cause of traumatic brain injuries. In 2015, medical costs from falls totaled more than $50 billion, with Medicare shouldering 75% of the costs.

How to prevent falls:

- Talk to your doctor and evaluate your risk.

- Consider strength and balancing exercises per doctor’s guidance.


- Have your eyes checked.

- Make your home safer—I’ll spend a moment on this one.  Are there uneven floors, carpets that needs to be stretched, or things you can trip on? Add railings on both sides of the stairs. Add a grab bar inside and outside your tub or shower and next to the toilet. Simple preventative measures will pay health and cash dividends.

4. Smart is as smart does. Become a smart shopper. Find the cheapest place to get prescription drugs and consider generic versions. Some services are now free, including mammograms, prostate screenings, and annual physicals. Check with your insurance provider regarding various tests. Insurance companies negotiate much lower rates with facilities that specialize in specific tests. For example, an MRI at a hospital or ER can be more expensive than at an outpatient MRI center.

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