Author Topic: Do you really have to spend that much for medical? My experiences in Calif.  (Read 2627 times)

oldladystache

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I keep reading that you have to allow hundreds of thousands for in case you get sick when you're retired.

My experience suggests that's not really so.

For most of my life I've been self employed (or retired) and medical insurance has been a significant expense but not as horrible as I've heard.

Before medicare kicked in I paid (as I recall) up to $600 a month for a high deductible policy. I had to pay copays of $20 or so when I visited a doctor, and similar costs for most prescriptions. And I always had an annual out-of-pocket limit. It varied from $5,000 to $7,000. So no matter how much medical service I required, It would never cost over $7,000 plus my monthly premiums. It's a lot, but not hundreds of thousands.

When I turned 65 I signed up for Medicare. Part A is free and part B costs about $100 a month. I signed up for a medicare advantage program that costs nothing extra. It looked really good on paper but I wasn't sure if it was as good as it looked. Well, it was very good.

The year after I signed up with Medicare I was diagnosed with ovarian cancer. That year I had extensive surgery, a week in the hospital, six months of weekly chemotherapy, 7 visits to the emergency room, 5 or 6 c-t scans, weekly blood tests, and a few more things I can't recall at the moment.

I paid $350 for the hospital and surgery, $50 for each c-t scan, $400 for each chemo infusion, $60 for each emergency room visit. I didn't add it all up, but I marveled about how reasonable it all was. Then at the end of the year I received a refund. I had accidentally paid more than my annual $4,000 maximum. Plus some friends took up a collection for me and gave me about $1,400.

The following year I had cataract surgery in both eyes. That cost me $5 every time I visited the doctor. Maybe 6 or 7 visits? 

I agree it would have been very bad without insurance, but I've always had insurance. And once you get to Medicare age you don't have to worry about pre-existing conditions.

And nursing home costs? If you have a paid for home you won't need it if you're in a nursing home so you can sell it and use that money plus your regular ongoing income to last a long time.




Catbert

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Before Obamacare one of the problems with major/ongoing medical problems was that insurance had maximum yearly and/or lifetime caps.  When you're well $1M lifetime (or even yearly) sounds like more than enough.  But when you have something like ovarian cancer or a heart transplant you run through that $1M quick than you would think. 

Also with individual insurance your premiums would keep creeping (or jumping) up until you couldn't afford them any more.   

Both these issues aren't a problem under Obamacare or Medicare...at least as I understand it.


The Resilent Dame

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The costs can vary substantially as you age depending upon many different factors. I own a business in the senior care industry and can see vastly different outcomes and lifestyle choices based upon proper and improper planning.

As far as living in a nursing home, very few elderly people live there long term anymore. Nursing home costs can run $8,000-$10,000 PER MONTH. If you end up with a serious illness or disability requiring long term nursing home care, the equity of your home will run out quickly. If you go to an assisted living facilities, your costs are in the neighborhood of $5,000/month. You are generally limited on the number of hours of direct care, though. If you choose in-home care, your costs can vary vastly depending upon how much or how little you receive. Monthly costs can be anywhere from $100 to $10,000. Many people prefer the option of living at home rather than a nursing home or assisted living. But be aware of the choices out there and plan ahead.

Things like strokes, Alzheimer's & dementia, and other chronic illnesses can end up wiping away your long term savings quickly. The costs associated with long term care are NOT covered by medicare. Long term care is almost entirely out of pocket until you run out of money and Medicaid kicks in. But then you are limited to medicaid-only facilities, or depending upon the area you live in, some long term home providers.

Long term care policies can be very beneficial in cases such as Alzheimer's/dementia are concerned because there will be years of very expensive care costs.

Look at your own situation carefully. Do you want to preserve your assets? Spend every last dime? Age at home? Retain a sense of independence? Or do you like the idea of living in a facility?

Lian

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It’s my understanding that the oft-quoted figure of $250,000 (give or take some) is an average for the entire population, which is useless when you are trying to determine the average cost that you are likely to pay – makes me crazy because I want to come up with a reasonable assumptions to use as a target.  It would be more useful to see a range of lifetime medical costs for a given population. Some people will have very high costs; some will have relatively low costs. Family medical history and current health should help determine where you are in that range, although there will never be any certainty as to future health conditions.

I worry about medical costs down the road just because it is so insanely expensive, but I don’t want to live my life in fear of having my assets wiped out by an illness. It’s hard to plan future finances to accommodate a worst-case scenario such as a major illness that may never happen– all we can do is take care of our health as best we can. Also, unless you get an illness that requires a lot of expensive treatment, it is likely that most costs will be end-of-life costs. It’s not clear how Obamacare will affect those costs, although at least medical insurance is more affordable than pre-ACA for low-income people. My current plan is to pay my living expenses with interest and dividends (and eventually SS), and use principal for end of life care only if necessary - otherwise it's an ice floe for me.  I will also likely move to a different country once I’m FI – for the adventure of it, not because of healthcare costs; but moving will mitigate some healthcare cost concerns, as many countries provide quality medical care at lower cost than the US.