It's Time to Help Retirees Save on Health Costs

Spending last week with my in-laws in Florida made me want to retire, too.  It seems their biggest decision of their day is whether or not to hit the golf course or sun by the pool with a good book.  Not a bad way to live, if you ask me.  Despite the relaxed appearance of their lifestyle, over a brunch discussion one morning it became clear that retirement isn't all mimosa's and putting greens.  Retired Americans are worried about healthcare costs and recent figures show they should be.

Most of us assume that when we turn 65 and retire, we will sign up for Medicare.  We assume Medicare will cover nearly all of our healthcare costs so we can spend our life savings on other living expenses, spoiling our grand kids and perhaps a vacation or two.  Medicare, however doesn't come close to paying the projected medical expenses of the average American over the age of 65.  On average, Medicare pays just 62% of Medical costs.  Other insurance plans such as supplemental insurance and Medicaid kick in to help out with the remaining expenses for those who qualify leaving the average retiree responsible for about 12% of their medical bills. 

Over the course of retirement, these out-of-pocket medical expenses really add up.  For example, a couple retiring at age 65 in 2013 would need $151,000 saved for a 50 percent chance of having enough money to cover health costs later in life (assuming they have Medicare B, Medicare D and Medigap insurance).  The figures go up from there.  The same couple in the 90th percentile of healthcare spending would need $360,000 saved for a 90 percent chance of being able to pay for health related expenses. 

What makes up the bulk of these costs?  Prescription drugs.  The number and type of medications older Americans take can cost hundreds, even thousands of dollars each month.  For example a couple in the 90th percentile of prescriptions drug costs will need to save over $100,000 more than a couple in the 50th percentile of prescription drug costs. 

Retired Americans and those who are nearing retirement are fearful about what the future holds when it comes to their healthcare.  With healthcare reform, there are a lot of unknowns about how medical care will change in the next few years as well as how much it will cost.  Fortunately, as nurse practitioners and physician assistants we are in a position to help. 

By carefully and responsibly prescribing medications to your patients, not only to those of retirement age, you may save them hundreds, even thousands of dollars each year.  Lowering the costs of your patient's medications can have a significant positive impact on their lifestyle.  80 percent of drugs have generic alternatives and as NPs and PAs, we should prescribe these as often as possible.  When it comes to medications without generic alternatives, look for a way around the brand name prescription.  Prescribing a generic medication rather than it's branded once-a-day time release alternative, for example, can cut medication costs in half.

Healthcare is expensive and we can't eliminate many medical expenses older Americans face.  But, we can involve our patients in our decision making and look for the most affordable, effective treatment possible- it will make a real difference in someone's life.  Maybe your patients will even use their cost savings to invite you out for a round of golf...