How to reduce the heath care cost after retirement?

One of the most greatest expenses after the retirement is health care. With the degrading of health and lack of income, it is important to know how to reduce the health care cost. Here are a few strategies that would help you to do so.

Retirement health care savings

After contributing to Medicare, you are not entitled to contribute to any other medical savings account. However, you can use the money in the account which is tax free to pay for your health care requirement. If you have an eligible health insurance with deductible family coverage, then you can contribute to the health care and use the account as a tax free source for the retirement.

Shop around

You can shop around for the services to know where certain medical procedures are less expensive. This is a double sided sword. You need to make sure that you do not fall into some bogus service providers or low quality service providers and damage your health more.

Add more brands to your list

According to the doughnut hole, the medical insurance provides 52.5% discount on the branded drugs and only 28% discount on the generic drugs. If the 48% cost of the brand is less than the 72% cost of the generic brand, you can shift to the branded drugs.

Fill the gaps

Some people use the help of the Medicare supplement policy to cover the gaps in the Medicare like, the deductibles, co-payments and others. There are some new type  of policies that have lower premium for higher cost sharing.

Long term care costs

The actual cost of a room in a nursing home, health aid services cost and assisted living cost would be more than a few thousand dollars, every year. Unless you have sufficient retirement fund collected for covering these charges, inflation and also daily requirements, it is better to use a long term care insurance.

For the people who have not equipped themselves for post retirement health care requirement and have planned to use their savings for their health care, it is estimated that it would take an average of 220 thousand dollars. Unfortunately, more than 39% of the Australians have not planned for their health care requirement and 59%, consider that they do not have enough money for retirement. If you retire at 62, then add $17 thousand for every year, till the age of 65.

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