Yesterday my wife and I were discussing retirement finances. We are in a very fine situation. Maintaining our current level of income, we will face some hefty RMDs down the line. I asked whether we might want to increase our “income” now - and either reinvest, gift, or spend it. She responded that we need to be sure we can cover possible medical expenses.
My question is, what sorts of medical expenses would be catastrophic for an older person who has all available Medicare and supplements? I personally have no expectation of ending up in extended end-of-life care - tho I could imagine the possibility of rehab stints following stroke or such.
My perception is skewed by the number of older folk I know who have had EXTREMELY costly procedures and treatment, while being personally billed pennies.
And, as much as things can change without warning, I’m in pretty darned good health for my mid-60 - no diabetes, no heart problems, low cholesterol, crazy low PSA…
I’m in the very fortunate situation such that a few 10s of thousands of $ here or there won’t be any problem - tho 100s of $K would be noticed. So what would cause 100s - or even 10s - of $K in medical costs?
Prescriptions are probably our biggest copay. And we’ve got good insurance. Every time my Dr goes over my bloodwork, I discuss whether I need everything I’m taking. She did remove one and reduce another, and so far, so good.
The paperwork that comes with my meds shows what it would cost me sans insurance - OMG - for some, it’s over $1K. I don’t remember if it’s for a 30 or 90 day supply, but either way, that’s a bite on a fixed income. It’s not right.
Right - but that is not what I’m asking about. How great are YOUR copays. WITH your good insurance. (Not seeking to invade your privacy.)
I can imagine dental work would be pricey. And hearing aids. But I’m not sure they would be “break the bank” pricey.
I do’t consider myself rich, but I have managed to save enough and create enough streams of income for retirement that I do not see how I could spend what I have. Unless the market/economy completely tanks, that is. So even an extra couple hundred $ a month in copays isn’t gonna render me destitute.
Some of it is going to depend on what you consider “break the bank” and what you consider necessary - for example, if you need full dentures and go with implant suported dentures, that might cost up to $60K. I think that would break my bank - but it’s possible to go with the much less expensive alternative of traditional dentures, whch wouldn’t break my bank.
I myself am not on Medicare yet - but my 85 year old mother is. Her out-of-pocket expenses are her co-pays on prescriptions and doctor visits and of course the premium for the supplement, I don’t think anything would cost her even tens of thousands of dollars other than long-term care. The most expensive supplement I saw last time we were looking for one (a few years ago) was around $600/month - I’m sure it’s more now but that also had coverage my mother didn’t need so we didn’t go with that one.
I know from taking care of my aging parents that home health aides are expensive, at least here in southern New England. Part-time aides were available for a minimum of four hours each day, at an hourly cost of $37. Full-time live-in aides cost the equivalent of eleven hours for each day. (So rather than paying $37x24 hours for a live-in, we were paying $37x11 hours, even though they were staying here.) So if you need someone long-term, that’s going to add up.
Long term care in the nursing home setting. Medicare doesn’t pay for it, so the options are either applying for and getting on Medicaid, or paying out of pocket. Getting on Medicaid, unfortunately, means spending down most of your assets, which means that by the time you can get nursing home care paid for by insurance, you’re going to basically be broke.
Punchline being, for elderly well-off Americans, medical expenses as such do not materially grow in old age. Even if they have a long term disease. Their high quality insurance eats all the real cost growth. One can of course debate how much longer that happy situation can continue before SS, medicare, and health insurance “reform” destroy the good deal.
Meanwhile, as one becomes more decrepit, the other sorts of spending decline and oftem more than offset the cost growth of medical care.
The elephant in the room is what the previous two posters mentioned. Medicare & related supplements pay substantially zero towards home-based helpmates or towards Independent Living (IL), Assisted Living (AL), or Skilled Nursing Facilities (SNF). And pay fairly limited for most forms of rehab such as one might need after a heart attack or stroke or even a fall with broken bones.
Those costs can strain even the well-off. Or set up a situation where the more decrepit one spends the less decrepit one into penury for their own impending decrepitude. There are deliberate legal provisions for spouses to legitimately bifurcate their finances so they don’t both go broke funding care for the first to decline.
My solution is LTC insurance that will pay for total care lifetime up to about 10% of my net worth. I got it a long time ago, have been paying in for awhile, and while it’s sorta expensive I expect it will insulate me and my assets from all but a nearly worst-case end of life experience.
I don’t think you can know this with any kind of certainty. Many seniors have a gradual decline to the point where they cannot take care of their spouse and/or cannot live by themselves. Whether you start adding levels of paid care as you need it, or make the plunge to a from-here-to-the-grave sort of facility, those costs can add up quickly.
Also, if you are depending on Medicare to continue as is for as long as you need it, you might be unpleasantly surprised. I don’t know what’s going to happen, but it seems to have a target on its back.
If part of “catastrophic” is having a lot less money left for your heirs, that is more likely, I think, than actually running out.
For us, we have some pretty good resources, but really at this point I’m just hoping to stay as healthy as we can. Every time I think of what could happen if I fell down the stairs, I shudder.
Makes me hope I just keel over while doing something I enjoy, while I’m still getting around ok. My parents and my inlaws have been ok for opposite reasons. My parents were living on SS, with Medicare. They never had big medical bills, even when Mom was in the hospital for a while before she died. Inlaws are well off, with Federal employee insurance. We may sort of fall in the middle. My pension is more than I would have gotten with just SS, and we have money socked away in IRAs and mutual funds.
My father did that. He was terrified of living as an invalid. But he died of a pulmonary embolism shortly after arriving at a tennis court to play with a friend. It was rough on the relatives, but my mother said he died with a smile on his face.
My mom died slowly and at great expense. As others have said, essentially all of her medical bills were paid by insurance, but she needed full time care for her last several months. She opted for a live-in home aid (which she could afford, and also, her office made an acceptable bedroom for the aid.) The other option would have been assisted living of some type. If you can afford paid assisted living, it is much nicer than what Medicaid will cover. And also, there are waiting lists.
Fair enough. But I have known a number of folk who have been in various facilities and have had varying types of in-home help, and I’ve spent many hours in various facilities visiting people and volunteering. And at present (and for some time up to now), I’m having considerable difficulty envisioning myself wishing to go either route. I’m too pigheadedly independent that, if I am not able to make it alone in a studio apartment, I would rather check out. If either/both my mind and/or body go to that extent, I’m not the person whom I wish to continue.
Sure, perhaps my mind may change when the time comes. But I’m imagining that as unlikely as my suddenly finding religion….
Are you equipped with the tools and mindset to kill yourself? If so, you can avoid that fate should it come to that. If not, then what?
I imagine that in a counterfactual society where suicide was considered a completely normal thing socially, legally, and emotionally, that damn near nobody would choose assisted living as an invalid as their end game. They’d almost all suicide instead. The only people doing AL would be the ones laid low by sudden e.g. stroke who suddenly gained the need for AL and simultaneously lost the ability to suicide.
Needless to say, the USA is not that society. Some other countries are moving in that direction, but not here.
My aunt and uncle, ages 93 and 94, both live in the nursing care wing of the local retirement home. While they’re both still mentally alert, they need help bathing and dressing. Their cost: $400 per day for each of them, for a total of 800 bucks a day.
Now, LTC takes care of about 75% of their costs, so they won’t become destitute anytime soon. Without it, however, they would be in serious financial trouble in a couple of years.
Part of the problem, when the change is gradual, is where do you draw the line. My father, alone in his mid-eighties, and just able to walk from room to room (he had a Segway which he used for outside errands like shopping), hired a young woman as a “housekeeper” part time (not a live in). She had some defined duties, like cleaning and laundry, and sometimes would just sit and chat. He didn’t need nursing, just help around the house. Was that a loss of independence for him? He didn’t think so.
My father was lucky, I think as he would view it, he fell off his Segway, which he had done before, called the EMTs and instead of helping him up and on his way, they took him to the hospital, and he died within 4 days. Just time for me to get there, and get him into one night of hospice. My mother had also died within a week of becoming incompetent (diabetic coma). Either of those could easily have gone another direction, and ended up being catastrophically expensive.
Anyway, I wish you the best, and hope you get the ending you would want.
