February 26

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How Much Will Health Care Cost in Retirement?

By Mac McLean

February 26, 2021


A lot of people wonder how much will health care cost in retirement?

Medicare Part B has a premium, a deductible, and co-pay.

Most individuals will pay a monthly premium of $148.50 for the government-managed health care plan this year, which is about one-tenth of what they receive from Social Security. According to the Medicare website, higher-income earners could see premiums ranging from $207 a month to $504.90 a month.

These premiums, the $203 Medicare Part B deductible and the 20 percent co-payment people face once that deductible has been met are just some of the health care costs people could face when they retire. Some groups estimate the average couple will spend about $400,000 on health care throughout their retirement – a sum that does not include the cost of long-term care if it’s needed.

Sign up for one of our Free Online Retirement Planning Events today so you can learn more about these costs and how to fit them into your retirement plan. Each event provides you with a chance to meet with professionals within our community who can explain your options and find a strategy that works the best for you.

Health care costs in retirement

A July 2019 report from HealthView Services estimates the average, healthy 65-year-old couple will spend $12,285 on health care each year. This estimate includes the couple’s Medicare Part B premiums, their premiums for Medicare’s prescription drug coverage, the cost of any supplemental coverage they might need, their dental coverage, and any out-of-pocket expenses they might incur over a year.

The report estimates these costs will rise to $21,164 per year when the couple reaches their 75th birthday and $34,268 a year when they get their 85th birthday. According to the report, managing health conditions like high blood pressure or diabetes before retirement will reduce a person’s overall health care costs. But this increases a person’s life expectancy, and that increases their overall health care costs.

Not included in HealthView’s estimate is the cost of long term care services, which are not covered by Medicare. Some people may never need these services, but others may depend upon them for care in the latter part of their lives. And they don’t come cheap, according to the LongTermCare.gov website, which found the average:

  • Private room in a nursing home with a 24-hour nurse costs $263 per day,
  • Private room in an assisted living facility costs $119 per day,
  • Adult daycare center costs $66 per day, and
  • Home health care worker costs $20.50 per hour.

Luckily, a private long-term-care insurance policy or your state; s Medicaid program can cover these costs so you or your family don’t have to. A certified financial planner understands what options are available in your state and will help you plot a course that best suits your needs.

Don’t miss your chance to get started today and sign up for one of our Free Online Retirement Planning Events from the Planning Community while space in these events is still available. Sign up today.

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