Understanding HC costs transitioning to Medicare

[LARS]

Curious if folks have found their medical/insurance costs have changed significantly (up or down) once on Medicare. In other words, if pre-Medicare you were spending 10% on med/insurance are you spending the same 10% post-Medicare? If it has changed is it predominantly in the insurance cost aspect?

All else being equal of course... (i.e. health status hasn't significantly changes)

 

[MichaelB]

DW's total cost for health care fell by at least 1/3 with Medicare. The deductible went from $6k to $180 (or thereabouts) and her premium for B+D+MediGap is less than 1/2 of my BCBS Bronze policy, same as the one she had previous to Medicare.

On the other hand, she had an HSA policy that gave us a nice tax adjustment and her visits to her primary care physican were covered. So, net is around 1/3 less with more choice, a bigger network and practically no deductible.

 

[LARS]

DW's total cost for health care fell by at least 1/3 with Medicare. The deductible went from $6k to $180 (or thereabouts) and her premium for B+D+MediGap is less than 1/2 of my BCBS Bronze policy, same as the one she had previous to Medicare.

On the other hand, she had an HSA policy that gave us a nice tax adjustment and her visits to her primary care physican were covered. So, net is around 1/3 less with more choice, a bigger network and practically no deductible.

Be nice if that is generally what others experience (costs drops) as it would most certainly soften the blow (at least a little) of turning 65!

Thanks for your response.

 

[REWahoo]

Our premium costs declined by roughly 40% when we went from pre-ACA individual health insurance to Medicare. I don't recall exactly what my deductible was but DWs was $7,500 (she was in a state high risk pool).

 

[Huston55]

LARS-

I’m sure you already know this but, you will have opportunities to control your health care costs when you become eligible for MC. The first opportunity will be whether to choose a Medicare Advantage plan (typically less expensive than MC + MediGap). The second opportunity will be, if you choose classic MC coverage, which MediGap policy to choose. You might also want to check with any ‘affiliated’ organizations you belong to; they sometimes offer discounted premiums for policies.

 

[ivinsfan]

You will have a better result comparing numbers if people let you know if they are on a subsidized plan pre Medicare. ie employer insurance or ACA subsidy.

 

[Gotadimple]

Lars,
I was on an employer plan before I was eligible for Medicare. Total premium costs dropped 30% between the employer plan and the Medicare cost (included Medicare Advantage). Rather than cite 10% of (something?) you're better off comparing premium cost to premium cost.

As for health expenses, you'll find more covered comparitively, depending on whether you stay on Traditional, add a Supplemental, or choose to use a Medicare Advantage plan.

- Rita

 

[CRLLS]

There is such a wide variety of employer provided health insurance options. Family vs spousal vs single coverage while working, ACA and non-ACA plans during self-employed times and ER years, and Medicare options it is hard to give a simple % comparison. Employer's % contribution, HMO's, PPO's, all kinds of ACA plans and then here are the Medicare options.

For us, our insurance costs years ago while employed were about the same as a pre-ACA private HD coverage (albeit not as good a plan)when considering employer's share of costs. When ACA came along, our costs were about the same (counting the subsidy now) but each year a lower coverage plan was necessary to keep premium costs under control. When Medicare came into our life, our total insurance costs went down more than 50% with better coverage and ~1/3 the annual deductible. That is for Medicare parts A and B, a Part D plan and F-HD Supplement.


Everyone's numbers will be drastically different, I'm sure.

 

[MichaelB]

Be nice if that is generally what others experience (costs drops) as it would most certainly soften the blow (at least a little) of turning 65!

If you are looking to have an estimate of what health care under Medicare will cost you, it's not difficult to see what your policy options are, determine the premiums, estimate your total cost of insurance, and compare it to your current cost.

 

[H2ODude]

Pre 65 had been able to keep previous employer insurance for both of us. $1,300 a month. Hence MC costs were a welcome expense. No complaints except get billed piddly amounts from providers for what little we use. Something about our state allows them to collect a small amount of what MC doesn't allow.

 

[ABQ2015]

I'm 2 1/2 years from Medicare but am calculating that I will be paying $3-4K more per year at age 65. My current healthcare costs are low since I have an employer subsidized health HDHP. My increased expected costs are due to:

-Lose HSA tax savings
-Lose employer HSA contribution
-Convert to more expensive employer BCBS Standard as Medigap plan
- Will likely pay extra Medicare Part B premiums for higher income

The plus side is that I will have few out of pocket costs which may save me money in the long run as my healthcare needs increase in old age.

 

[ExFlyBoy5]

If you are looking to have an estimate of what health care under Medicare will cost you, it's not difficult to see what your policy options are, determine the premiums, estimate your total cost of insurance, and compare it to your current cost.

Oye...I can't agree with this. I have Tricare and it's all pretty simple. My Dad on the other hand, has a medicare advantage plan and I have discovered how confusing it is (I have recently taken over his financial affairs) ...especially the prescription plan. There are different tiers of drugs with different deductibles and copays and his last EOB was 14 pages long.

Nonetheless, I now have to become very familiar with it with the recent development that he most likely has multiple myeloma...interesting days ahead for sure.

 

[MichaelB]

Oye...I can't agree with this. I have Tricare and it's all pretty simple. My Dad on the other hand, has a medicare advantage plan and I have discovered how confusing it is (I have recently taken over his financial affairs) ...especially the prescription plan. There are different tiers of drugs with different deductibles and copays and his last EOB was 14 pages long.

Nonetheless, I now have to become very familiar with it with the recent development that he most likely has multiple myeloma...interesting days ahead for sure.

I agree that with Medicare Advantage it can still be a challenge, because insurance company rules are added. I was thinking MedicareB + Medicare D + MediGap, and with Medicare D there's an online tool to calculate the total yearly cost of premiums + copays for one's lineup of prescriptions. In addition, if one's prescriptions change, the policy can be changed during yearly open enrollment.

 

[ExFlyBoy5]

I agree that with Medicare Advantage it can still be a challenge, because insurance company rules are added. I was thinking MedicareB + Medicare D + MediGap, and with Medicare D there's an online tool to calculate the total yearly cost of premiums + copays for one's lineup of prescriptions. In addition, if one's prescriptions change, the policy can be changed during yearly open enrollment.

Thanks for the clarification. I am just starting to understand the intricacies of it and am realizing that the advantages plans can be...um...quite confusing.

 

[jonat]

DW and I are in the last months of the company-paid COBRA plan from my retirement package. She is of Medicare age, I am not quite yet. We signed her up for the Medicare Advantage plan from United Health comarketed with AARP. It will cost her $81/mo (on top of Part B premium) and provides excellent benefits and only the $137 (or whatever) annual Medicare copayment. Most everything, including the drug she is on, is zero cost.

For myself I am looking at ACA plans that will cost me (after subsidy) around $500/mo, with a deductible of $3500. I'll have to put up with this for a bit less than two years, then I go on Medicare.

 

[Hermit]

About $12k the 12 mos prior to Medicare while on COBRA after retiring at 63. About $1.5K the 12 mos after Medicare with Medicare Advantage. (I don't do much traveling so Advantage works for me, but it does limit your choices.) These numbers include dental and glasses which were pretty minimal during those two years and Medicare paid quite a bit of dental. I also get the dental discount offered under the Advantage provider which is usually around 40% off standard dental fees. Those post Medicare numbers have held pretty steady since then with the exception of dental work due to crowns and root canals. My biggest potential driver appears to be keeping my income under the caps for added Medicare fees.

 

[W2R]

For me, my health care spending (including premiums, Part B costs, and dental, plus all other health care costs) have continued going up after Medicare at the same rate as before Medicare or higher.

If I didn't have Medicare I would be paying a lot more than I am, though. Some people find that as they grow older, their medical costs rise sharply and they need Medicare to keep their own health care spending reasonable. Others are eternally young (but that's not me). For me, dental implants have been a big expense, as well as frightfully expensive medications that my doctor is determined to prescribe for me.

IMO, unless you either have average to good teeth or else plan to not have implants, it would be smart not to count on getting lots of extra money for fun stuff when Medicare begins.

Year Annual cost
2010: $2,619 (first full year of retirement)
2011: $3,242
2012: $3,922
2013: $7,936 (began Medicare in June 2013)
2014: $4,972
2015: $8,113
2016: $11,953
2017: $14,975

 

[LARS]

I guess my takeaway from the comments is that, generally speaking and all else being equal on the health front, costs tend to the lower side once on Medicare.

Thanks everyone for input.