Finding The Right Health Insurance in Retirement

Post by Carrie Van Brunt-Wiley – how to find the right health insurance in retirement.

There’s a lot to look forward to when it comes to retirement. You no longer have to suffer bumper-to-bumper traffic each morning during a long commute. Your hours are yours to fill. You can forget about taking orders from a cantankerous boss five days a week or getting push back from rookie co-workers who don’t believe your experience matters.

If there’s one thing in life that isn’t overrated, it’s retirement.

However, just like any other major life change there are some insurance considerations that you should make to ensure that you and your health are protected in the event of illness or injury. Baby boomers and other soon-to-be retirees are a unique position when it comes to medical coverage. Here’s why:

* The economy is still in recovery. While you may have enough put away for retirement, you would hate to spend an unreasonable sum of money on mediocre medical coverage. Deductibles and co-pays can eat up your nest egg pretty quickly in some situations.

* The Affordable Care Act is changing the rules. With rampant misinformation and facts clouded in heated political debate, it has been difficult to find concrete information on how healthcare reform will directly impact you and your finances.

* You’re aging and an unfortunate reality is that health insurance becomes increasingly important as you get older. Even healthy bodies sometimes get sick or injured, and physicians can prescribe high-priced drugs when they do.

The good news is that you don’t have to worry as much about the hunt for insurance for the first 18 months of your retirement. It’s unlikely your former employer will provide you the same insurance benefits after you retire, but you can still get coverage from the same provider through the Consolidated Omnibus Budget Reconciliation Act, or COBRA.

There is a catch, however: You will be responsible for your entire premium; your employer will no longer pay a portion. You also might face additional administrative fees. Still, it makes a good fallback as you sort through other options for a long-term solution. If you’re looking for insurance through COBRA, speak to your benefits department.

If you’re retiring before 65, though, you need to find and pay for an individual health plan. Under the Affordable Care Act, you’ll be able to search for insurance through state exchanges, and insurance companies are forbidden from denying coverage because of preexisting conditions. Another perk is that preventive care will be free. You might even receive tax credits, and you retain the ability to choose your own doctor.

If you’re 65 or older, then you can get coverage through Medicare. Again, the Affordable Care Act has ushered in some changes in the program, lowering prescription drug costs and improving long-term care services. Again, you’ll qualify for annual screenings for cancer, including mammograms, and diabetes, as well as a yearly wellness visit, at no charge. Remember, however, that you will have to pay a portion of your Medicare costs.

Finding healthcare in retirement is a sticky process, but with the right tools you can find an affordable insurance plan. It’s always best to look at premiums and coverages from multiple providers. Decide which insurance policy is best for you and your finances only after you have collected several quotes. You might want to speak to other retirees about their health insurance. Asking for recommendations from your peers might be a good way to find a reliable carrier.

Keep in mind that your coverage needs might differ significantly from those of your neighbor or sister-in-law. Healthcare reform will work in your favor if you have the right information. In fact, it might even make the whole process less of a hassle.

This article was contributed by Carrie Van Brunt-Wiley, Editor of the HomeInsurance.com blog. Carrie has been writing insurance news and consumer information for HomeInsurance.com since 2008. She graduated from the University of North Carolina in Wilmington in 2005 with a B.A. in Professional Writing and Journalism.