Retirees will spend an average of $250,000 on healthcare after retirement. High healthcare costs could prevent you from having the retirement you imagined. If this number worries you, here are seven ways to save on healthcare costs after retirement.
1. Take preventative steps
Staying proactive about your health is the best way to save on healthcare costs. You can do this by eating a healthy diet and maintaining an exercise regimen. SilverSneakers is a nationwide program dedicated to helping seniors stay fit and active. Covered by most Medicare Advantage plans, SilverSneakers gives you access to thousands of gyms and fitness centers across the country. Search here to find a participating SilverSneakers location near you.
2. Save on dental costs
Original Medicare (Part A and Part B) does not cover dental care which can put a major financial burden on seniors. If you want dental coverage, it might benefit you to enroll in a Medicare Advantage plan with dental coverage. In addition to dental coverage, many Medicare Advantage plans also offer vision and hearing care. Another option is to enroll in a senior dental savings plan. For a low yearly fee, you could have access to a wide network of dentists who provide care at discounted rates. Search here to find a senior dental savings plan in your area.
3. Set up a health savings account
If you are enrolled in a high-deductible health insurance plan, you may qualify for a Health Savings Account (HSA). This tax-exempt savings account allows you to stow away money for any future medical expenses you may have so you can better plan for your future. However, there is a government-mandated maximum you can contribute each year. For 2018, it’s $3,450 for individuals and $6,750 for families. Note: you can no longer pay into Health Savings Accounts once you start collecting Medicare benefits. However, Medicare Advantage offers a Medical Savings Account (MSA) similar to a HSA where you can use tax-free savings to pay for medical expenses.
4. Re-evaluate your Part D plan
If you have a stand-alone Medicare prescription drug plan (Part D), it may benefit you to re-evaluate your prescription drug needs every year during Medicare’s Open Enrollment Period (October 15 – December 7). If you start taking new prescription drugs that aren’t covered by your plan, it might make sense to change plans or ask your doctor to prescribe you a less expensive generic version of the drug. Each prescription drug plan has a formulary, or list of covered drugs, that you can consult to make sure your drugs are covered. A plan can change its formulary, but it is required to give you 60 days’ notice if it does so.
5. Enroll in a Medigap plan
If you have a chronic illness, you might want to enroll in a Medigap (Medicare Supplement) plan. Medigap helps fill in the gaps in coverage and pays for many out-of-pocket Medicare expenses like deductibles, premiums, and copays. Medigap coverage is standard no matter where you live (except in Massachusetts, Minnesota, and Wisconsin who have their own standard plans), but premiums may vary by state. Search here to find a Medigap plan in your area.
6. Stay in-network
Although Medicare is a nationally recognized, some doctors and healthcare providers may have opted out of Medicare, meaning you would have to pay the full cost of services. It’s wise to call your insurance plan directly to ask if your doctor is in-network before each visit. Similarly, your preferred pharmacy might not be the cheapest option for you. Check with your insurance plan to see which pharmacies are in your network so you don’t pay more than you need to for your prescription drugs.
7. Be social
Isolation is unhealthy no matter your age, but seniors are at greater risk of isolation compared to other demographics due to less mobility and not working. Staying social can help your overall health, reduce your cost of care, and lower mortality rates. Programs like SilverSneakers encourage both physical fitness and social engagement to help you stay healthy and happy longer.