# Health Care Costs in Retirement- Benefit or Buy Add-on Insurance



## jlunfirst (1 mo ago)

Given my generally good health, I anticipate taking the lowest cost pkg...except there's the dental for private top-up insurance when I retire. My employer provides zero after 65. 

I don't have any heart, respiratory nor mobility issues at all. I am not diabetic. How have you found your needs so far? More needs after 70 or 75?


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## Beaver101 (Nov 14, 2011)

Self-insure all the way to death.


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## ian (Jun 18, 2016)

I turned down the add on health insurance program when I retired. Looking back 11 years it was the right choice for me.

Not one of our high cost expenses would have been covered. My sister OTOH is on the other side of this. She has medical issues. The insurance has paid off for her.

Keep in mind that you can deduct these premiums on your tax return

Nor is it a lifetime commitment. You can cancel at any point in time.


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## OptsyEagle (Nov 29, 2009)

Yes. It is another one of those situations where you hear:

_"Do you feel lucky punk...Do you?"_

Unfortuneately, with personal medical insurance, there is usually around 5 bullets left in Clint Eastwood's, 6 bullet gun. It is very unlikely you will win.


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## AltaRed (Jun 8, 2009)

I kept my EHB (Extended Health Benefits) plan when I retired, but at the lowest (highest deductible) level as employer picks up the majority of the premium cost. I can easily self-insure for most items but it is the more catastrophic costs one would like some support on..... within the plan's lifetime limits of course. I do similarly on home and auto insurance, i.e. high deductibles.


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## ian (Jun 18, 2016)

AltaRed said:


> I kept my EHB (Extended Health Benefits) plan when I retired, but at the lowest (highest deductible) level as employer picks up the majority of the premium cost. I can easily self-insure for most items but it is the more catastrophic costs one would like some support on..... within the plan's lifetime limits of course. I do similarly on home and auto insurance, i.e. high deductibles.


I have what I consider to be a reasonable pension health plan. We get $1500 year HSA. Then we pay the next $3K medical/scripts each. After that catastrophic plan kicks in to pay 90percent...only for meds, not dental. Perfect for us because as per above it is the big numbers that we want to insure against.

The real gem is 60 days consecutive out of country medical/evac unlimited times per year w/no qualifications. We did not realize the value when I retired at 59. Eleven years later I now understand the value based on what our friends tell us about their experiences and costs related to travel insurance. This is now the limiting time factor on our fall and our snowbird trips.

Our big medical expenses have been things like dental implants, eye lens, and a minor cosmetic surgery. None of which would have been covered by the optional plans offered at retirement. This has been about our only out of pocket, net of the HSA.


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## AltaRed (Jun 8, 2009)

ian said:


> The real gem is 60 days consecutive out of country medical/evac unlimited times per year w/no qualifications. We did not realize the value when I retired at 59. Eleven years later I now understand the value based on what our friends tell us about their experiences and costs related to travel insurance. This is now the limiting time factor on our fall and our snowbird trips.


That is the real gem for us as well. Never have to think about Emergency Out-of-Country Medical Insurance. It could be (is) a killer for many aging seniors.


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## Zipper (Nov 18, 2015)

My neighbour is a Canada Post worker. He had a Melanoma removed and is on a preventative chemo dose for a year. It looks like they got it all but you can never be sure. He has a plan that covers the $15 000 a month one-a-day pills. That would be bitter medicine to swallow if he was self insuring.

I guess the drug companies can inflate the cost to the max as long as the Insurance companies are paying. No wonder their rates are skyrocketing.


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## MrsPartridge (May 15, 2016)

Is there some government plan that covers meds for those over age 65?


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## jlunfirst (1 mo ago)

MrsPartridge said:


> Is there some government plan that covers meds for those over age 65?


One would have to check your provincial govn't health authority /ministry website. Each province handles it differently, and some of it is more oriented to low income seniors.


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## ian (Jun 18, 2016)

MrsPartridge said:


> Is there some government plan that covers meds for those over age 65?


Alberta automatically provides everyone over 65 with Blue Cross coverage for prescription drugs. It extends to your spouse, no matter what her age is.

I was quite surprised. It is not based on income.

Net net is that we pay about 30 percent for most prescriptions at the pharmacy. Blue Cross is billed direct for the balance. Not certain what drugs it covers and what it does not. Fortunately we have few prescriptions and they are quite inexpensive.


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## jlunfirst (1 mo ago)

ian said:


> I have what I consider to be a reasonable pension health plan. We get $1500 year HSA. Then we pay the next $3K medical/scripts each. After that catastrophic plan kicks in to pay 90percent...only for meds, not dental. Perfect for us because as per above it is the big numbers that we want to insure against.
> 
> The real gem is 60 days consecutive out of country medical/evac unlimited times per year w/no qualifications. We did not realize the value when I retired at 59. Eleven years later I now understand the value based on what our friends tell us about their experiences and costs related to travel insurance. This is now the limiting time factor on our fall and our snowbird trips.
> 
> Our big medical expenses have been things like dental implants, eye lens, and a minor cosmetic surgery. None of which would have been covered by the optional plans offered at retirement. This has been about our only out of pocket, net of the HSA.


My partner enjoyed a fairly good retirement health care benefit plan via his employer, oil company. $1500 HSA is helpful. Too bad I didn't join in on his plan before he died since I already have my plan while working.

I'm not surprised not to get any employer sponsored health care benefit in retirement. The taxpayers would revolt.


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## ykphil (Dec 13, 2009)

We live in Mexico, retained Canadian residency for tax purposes, but lost our provincial health care because we no longer met the provincial eligibility requirements, so we currently self-insure since last August after our catastrophic coverage expired. Went through a broker and the lowest cost was around $ 3,500 USD per year with a $10K deductible, and this is only for emergency medical after an accident or unexpected illness. Of course, any pre-existing condition and anything related to it is excluded from any emergency medical coverage. I am debating whether I should renew it but I can't get myself to agree with these costs. Routine visits, prescription drugs, etc. are not covered under emergency medical plans so we pay those out-of-pocket if and when needed. In the meantime, my wife and I are both Mexican residents so we have access to the public health care scheme which is quite deficient and inadequate, but still something.


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## sags (May 15, 2010)

Ontario provides health insurance for seniors but it is limited coverage. We have a very comprehensive private health plan for retirees that is administered by a union trust.

Last year they improved a lot of benefits and dropped all co-pays. It appears they have done very well investing the funds.

The plan saves us a lot of money. My wife had a recent dental visit and the $700 bill was fully paid by the insurance.

The plan also includes a $1600 a month subsidy for LTC care for eacho of us in the future. Overall it is a very good plan because the members control it.

We save many thousands of dollars a year on prescriptions, dental, eyeglasses, 30 days of travel outside Canada, and other benefits.


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## sags (May 15, 2010)

Ontario did pay for cataract surgery on both eyes and gave me perfect vision for the first time in my life.

Ontario pays the first amounts to our healthcare and the insurance plan pays the balance. We rarely have to pay anything.


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## jlunfirst (1 mo ago)

sags said:


> Ontario provides health insurance for seniors but it is limited coverage. We have a very comprehensive private health plan for retirees that is administered by a union trust.
> 
> Last year they improved a lot of benefits and dropped all co-pays. It appears they have done very well investing the funds.
> 
> ...


You have a good add-on private health insurance provided by the union trust. 

LTC subsidy is incredible. Did you work for govn't or private sector?


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## jlunfirst (1 mo ago)

Anyway have to continue to be mindful of health.


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## jlunfirst (1 mo ago)

ian said:


> Alberta automatically provides everyone over 65 with Blue Cross coverage for prescription drugs. It extends to your spouse, no matter what her age is.
> 
> I was quite surprised. It is not based on income.
> 
> Net net is that we pay about 30 percent for most prescriptions at the pharmacy. Blue Cross is billed direct for the balance. Not certain what drugs it covers and what it does not. Fortunately we have few prescriptions and they are quite inexpensive.


I believe Ontario is similar for their list of drugs. I can easily ask my siblings who work in hospitals and also have to deal with my 88 yr. old mother's health care needs. Or it's easily on the Ontario Ministry of Health's website..with some digging.


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## Tostig (Nov 18, 2020)

I find it ironic that upon retirement, your employment group health benefit gives you less coverage at a stage in life when would require more.


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## jlunfirst (1 mo ago)

Tostig said:


> I find it ironic that upon retirement, your employment group health benefit gives you less coverage at a stage in life when would require more.


Not surprising, if any employer wants to save money, when the employee has long left the organization. 

It's enough if employer has a defined private pension plan that they must pay out until death. If the employee hasn't paid much more into the plan during their work years.

There is considerable variation for retired employees who worked the public sector, if they get any additional health care benefit during retirement. Mine doesn't provide any. It varies from jurisdiction to jurisdiction, and also the size of the retiree pension membership group for that pension trust (if that is where the funds are drawn on for health care. I don't know things are structured in pension trusts by law...which probably varies from province to province.)


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## londoncalling (Sep 17, 2011)

Most health benefit plans are designed to payout the majority of contributions as benefits. This is much different than a DB pension which is about maintaining longevity of the plan as its primary aim to generate funds for future payouts. As a result few health plans fund benefits to members that are no longer contributing. As already noted health costs in retirment are often substantially higher than what is used by the non retired active workforce. Aside from public employees I only know of a couple that provide benefits into retirement. Often if there is, they are reduced and temporary up to a certain age and/or number of years.


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## jlunfirst (1 mo ago)

I found it useful reading whole article, focus for me was what public health care covers, and the comments.. where people compare against differences amongst provinces in public health care costs. Useful.
Do retirees need to pay for private health insurance? - The Globe and Mail


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## pwm (Jan 19, 2012)

I'm watching my neighbour's house while they are at the Oasis Country Club in Palm Desert CA. They will be there for 5 months. As you can guess, he has lots of money as he owned a business with 350 employees before he sold it. He emailed me to say his wife had some medical problem which required some tests and an overnight stay in a hospital. The total bill was $80,000!
Of course he has travel insurance, but not sure how much of that he will have to pay over and above that coverage and his Manitoba Health coverage. Just a reminder of how expensive health care is in the USA.


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## OptsyEagle (Nov 29, 2009)

The only reason public sector employees have health benefits in retirement is because the negotiators, that were negotiating this on behalf of the taxpayer, were also employees of the government and their personal bias created such an unfair deal. Absolutely one sided.

You just don't see this type of unfairness in the private world where the people who pay for it are allowed to negotiate a fairer deal for all. A private manager of a business would never waste that kind of money on such nonsense. He would see putting that money into higher salaries would meet both groups needs much better, but in the government's one sided negotiations, they just decided to take both from the taxpayer.


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## AltaRed (Jun 8, 2009)

I tend to agree with OE that it does vary in the public sector. Health benefits are not part of (funded by) a pension plan though. They are a separate, e.g. union, negotiation and subject to premium deductions paid for separately by former employer and annuitant.

My spouse is a member of LAPP (Local Authorities Pension Plan of Alberta) which covers most nurses, most?all? municipal workers, etc, etc. She does not receive any separate extended retirement health benefits but she is covered under my extended health benefits plan as a dependent, which is a blue chip corporation that covers a percentage of the overall premiums to the group plan. So there are anomalies to the most likely civil service/private industry scenarios. The most valuable part of my retirement health benefits is International travel medical insurance especially as we cross 75 years of age.


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## jlunfirst (1 mo ago)

AltaRed said:


> I tend to agree with OE that it does vary in the public sector. Health benefits are not part of (funded by) a pension plan though. They are a separate, e.g. union, negotiation and subject to premium deductions paid for separately by former employer and annuitant.
> 
> My spouse is a member of LAPP (Local Authorities Pension Plan of Alberta) which covers most nurses, most?all? municipal workers, etc, etc. She does not receive any separate extended retirement health benefits but she is covered under my extended health benefits plan as a dependent, which is a blue chip corporation that covers a percentage of the overall premiums to the group plan. So there are anomalies to the most likely civil service/private industry scenarios. The most valuable part of my retirement health benefits is International travel medical insurance especially as we cross 75 years of age.


Same here.... our employees are in LAPP and we do not get any health care benefits in retirement. Not even management either. Yes Alberta municipal employees are primarily covered by LAPP. In my opinion, the trust is not as 'wealthy', as Opseu Trust which is for Ontario provincial govn't employees. I worked for Ontario govn't for a number of years.

So would appreciate folks would not broadbrush all public sector employees. Different public sector employers have different, separate agreements with pension trust.


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## ian (Jun 18, 2016)

pwm said:


> I'm watching my neighbour's house while they are at the Oasis Country Club in Palm Desert CA. They will be there for 5 months. As you can guess, he has lots of money as he owned a business with 350 employees before he sold it. He emailed me to say his wife had some medical problem which required some tests and an overnight stay in a hospital. The total bill was $80,000!
> Of course he has travel insurance, but not sure how much of that he will have to pay over and above that coverage and his Manitoba Health coverage. Just a reminder of how expensive health care is in the USA.


A colleague of mine suffered a heart attack in Florida. He was hospitalized. He had out of country medical insurance.

While in the hospital, after contacting his insurer, he found out that his insurer was in constant contact with the hospital and those physicians and specialists who were managing his care. The insurance company wanted one thing....when would he be well enough to be transported by medical evac home to Toronto and into a hospital in Ontario. The insurer's goal is to get the the patient out of an expensive environment ASAP before there is any deterioration in medical condition.

After some time at home he rec'd a huge bill from the hospital. Alarmed, he phoned his insurance agent. The agent told him that the bill was for info purposes only. The agent also told him that the carrier had already paid the bill. It was pages and pages long. Right down to the glass of juice.

Apparently the practice of insurers is negotiate an immediate discounted payment to the hospital. Usually in the range of 50-60 percent of the bill...on condition that the carrier remit the agreed number by bank transfer within a very few days.


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## jlunfirst (1 mo ago)

ian said:


> A colleague of mine suffered a heart attack in Florida. He was hospitalized. He had out of country medical insurance.
> 
> While in the hospital, after contacting his insurer, he found out that his insurer was in constant contact with the hospital and those physicians and specialists who were managing his care. The insurance company wanted one thing....when would he be well enough to be transported by medical evac home to Toronto and into a hospital in Ontario. The insurer's goal is to get the the patient out of an expensive environment ASAP before there is any deterioration in medical condition.
> 
> ...


I sure hope ukraniandude is reading this.

I don't think it's that much easier for Americans close to retirement. Their Medicaid doesn't solve problems and they still have to pay additional premiums o be properly covered. It's more shocking to read how many delay retirement because of hanging onto their employer's health care insurance benefit.

It happens at our end too, but more for dental, etc. After all just because one has in current plan for semi-private or private hospital room benefit, doesn't mean you can even get the rm. if the hospital is already full of very sick people if you are at the hospital at a point in time. That hasn't to do with our health care system: there's only so many beds available with the right/available number of trained professional staff to look after the patient.


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## ian (Jun 18, 2016)

My sister is a retired high school teacher. Her post retirement health benefits are optional. She pay $300 plus dollars a month for them.

My private employer plan provides us with a $1500 health savings account. It includes 60 day out of country medical-unlimited times per year. This is now more beneficial to us than the HSA amount.

It also provides a catastrophic medical plan. Post HSA, after we have paid $3000 annually per person for meds, etc. the plan then picks up 90 percent. Never used that, hope that we neve have to. It is mostly directed at drugs and rehab. We feel very fortunate to have this coverage.

No dental or vision unfortunately....other than the HSA. Dental implants, root canals. crowns, lenses have been costly.

I managed my mothers affairs. She was on my father's railway pension. No health benefits however each year she could purchase one of several a highly discounted Blue Cross policies for prescription drugs that were not covered by Veterans Affairs.


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