Planning for Retirement

Health Care

Medicare doesn't cover many types of health care that your health insurance plan may now include. For example, Medicare and Medicare Supplement Insurance plans do NOT pay for dental care (cleanings, fillings, extractions, crowns and dentures), vision care (routine vision tests, eyeglasses and contact lenses), hearing aids and tests, routine foot care, orthopedic shoes, annual physicals after your first one, and up to $3,600 of your prescription drug expenses even if you have Medicare's new prescription drug benefit (Plan D).

Some Medicare+Choice HMO-type plans will cover some of these. However, Medicare+Choice plans can change what they do and don't cover at the beginning of each year. So, even though some of these items may be covered during your first year in a plan, they may not be covered in future years.

Very few private insurance plans are available to cover these types of care after you turn 65. Even AARP's Dental Insurance Plan is of questionable value. The annual premium for their best plan is more than $490 this year. That provides a $1,200 maximum benefit after you pay a $50 deductible, plus a 20% co-pay for denture repairs and cleanings, and a 50% co-pay for fillings and root canals out of your own pocket. In other words, to receive the maximum $1,200 benefit under AARP's best dental plan, you will pay anywhere from $840 to $1,740 out of pocket, depending on the procedures you have done.

Our recommendations. If you have put off any health care that your health insurance will pay for, get it done during the two years before you retire – whether it is dental work, a second pair of glasses (so that you won't have to pay for a new frame each time you need a new prescription), hearing aids, orthopedic shoes, etc. If you don't do it now, Medicare won't cover it after retirement.

Taking care of your deferred health care now could save you a substantial amount of money – regardless of whether you have a traditional health insurance plan, a flexible spending account, or a Health Savings Account. If you do have a flexible spending account for health care, set aside the maximum amount of pre-tax salary dollars in your account. Then, spend it all on the health care you've put off.

After retirement. You may want to enroll in one or more discount health care plans. These are not insurance plans. Instead, they typically establish networks of health care providers who provide discounts to their members. But, you must pick a reliable plan. Otherwise, you could be throwing your money down the drain.

We are affiliated with Vital Savings by Aetna, a family of discount programs designed to help you save on a wide array of health-related products and services. Each program gives you access to a network of participating providers that have agreed to offer services at a discounted fee. When you consider your routine health care expenses – these savings can add up to hundreds of dollars annually. (This program is administered by the Aetna Life Insurance Company.)

Vital Savings by Aetna offers discount programs for:

Dental Care – Save 15% to 50% off the cost of a wide array of dental services. Also save on Sonicare® toothbrushes and Epic Dental products including gum, mints, toothpastes and mouth rinses that contain xylitol – a natural sweetener that stops tooth decay.
Vision Care – Save on exams, eyeglasses, contact lenses – even LASIK eye surgery – through the Vision One® discount program from Cole Managed Vision.
Alternative Health Care – Save on chiropractic services, acupuncture, massage therapy and nutritional counseling through Natural Alternatives program. You can also save on vitamins, nutritional supplements and other health-related products througn the Natural Products program.
Fitness – Discounts on membership rates at independent health clubs contracted within the GlobalFitTM network and savings on home exercise equipment.
Long Term Care – Save 5% to 30% off the cost of assisted living facilities, home health care, respite and hospice care, physical and occupational therapy, and more.

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