Pre-Retirees: Plan Now for Health Care Costs

Submitted by Edward JonesPrint Story | Email Story
If you're close to retirement, you'll have several financial issues to consider. But you'll want to pay attention to one of the most important of these issues: health care costs. How can you prepare yourself for these expenses? First, get an early start on estimating health care costs. More than two-thirds of those planning to retire in the next 10 years say they have no idea what their health and long-term care costs will be in retirement, according to the Edward Jones/Age Wave Four Pillars of the New Retirement study. And some people don't worry much about these costs, which may be considerable, thinking that Medicare will pay for most of them.
 
While Medicare does cover many medical expenses, it also has its own costs. You probably won't pay a premium for Part A (inpatient/hospital coverage), since you likely had this cost deducted from your paycheck when you were working. But if you are hospitalized, you'll have to pay deductibles and coinsurance (the percentage of costs you pay after you've paid your deductible). Part B (doctor's visits) requires a premium, deducted from your Social Security checks, and you must pay an out-of-pocket deductible. After you meet this deductible for the year, you typically pay 20 percent of the Medicare-approved amount for most doctor's services. And when you enroll in Part D (prescription drug plan), you will likely also have to pay a monthly premium, an annual deductible and coinsurance or copays.
 
To help pay for the Medicare deductible, coinsurance and copayments, you may want to get supplemental insurance, known as Medigap. Premiums for Medigap vary, depending on the plan you choose.
 
As an alternative to original Medicare, you could select Medicare Advantage (sometimes called Part C). Medicare Advantage plans are offered by private companies approved by Medicare, but the benefits and costs vary by plan. These plans generally will incorporate Medicare Parts A and B and will provide additional medical coverage, such as prescription drugs.
 
When you incorporate all the above, the annual out-of-pocket costs for traditional medical expenses likely will be about $4,500 to $6,500 per year, per person – not insignificant, but certainly a number that can be addressed by careful planning.
 
But there's one more expense to keep in mind: long-term care. The average cost of a private room in a nursing home is more than $100,000 per year, according to the insurance company Genworth. And Medicare typically pays few of these expenses.
 
Clearly, between regular medical costs associated with Medicare or those not covered by it, and costs resulting from the possible need for long-term care, your health care bills can mount. To meet these costs, you need to plan ahead – and take action.
 
For example, it's essential that you incorporate health care expenses into your overall financial strategy. You can also work with a financial professional to run some "what-if" analyses to see if your strategy would be derailed by a potential long-term care stay. And the professional you work with may be able to suggest specific protection vehicles that can help you meet the costs of long-term care.
 
The best time to prepare for your health care costs during retirement is well before you retire. So, if you haven't already started, now is the time to do so. When it comes to paying for health care, the fewer surprises, the better.
 
This article was written by Edward Jones for use by your local Edward Jones financial advisor. Courtesy of Rob Adams, 71 Main Street, North Adams, MA 01247, 413-664-9253.. Edward Jones, its employees and financial advisors cannot provide tax or legal advice. You should consult your attorney or qualified tax advisor regarding your situation. For more information, see EdwardJones.com.
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State Education Board Approves Push for In-School Learning

By Tammy DanielsiBerkshires Staff

DESE Commissioner Jeffrey Riley explains the reasoning for getting students back in classrooms and off remote learning. 
BOSTON — Schools across the state are being ordered to resume in-classroom instruction as soon as possible, beginning with elementary grades on April 5. 
 
The Board of Elementary and Secondary Education voted 8-3 on Friday afternoon to accord DESE Commissioner Jeffrey Riley authority to change requirements for learning time that would not include remote learning.
 
Families would still have the ability to remain remote for the rest of this school year and some schools may be able to get waivers, but the state would have the ability to hold back Chapter 70 education funds for schools out of compliance. 
 
The vote followed hours of testimony from medical professionals, educators and parents that veered from strongly encouraging the return to school as an important to students' health, well-being and educational needs to cautions that many schools did not have the ability to provide adequate spacing or COVID-19 precautions and calls for school employees to be vaccinated prior to any return. 
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