Health care is one of the biggest expenses for many Americans, especially retirees. While retirees who have reached the age of 65 can use MedicarePeople who wait that long either rely on paying for personal insurance or, hopefully, get it through their company. With corporate costs rising, employers are looking for different ways to offer health care benefits to their retired employees who are not yet 65 and who are eligible, according to Statement from WTW.
For help figuring out how to work health care into your retirement plans, consider working with financial consultant.
Health care problems for retirement
A recent survey by WTW found that half of employers are concerned about the increased cost of providing healthcare benefits to their retired employees who are not yet able to access Medicare. These costs are expected to rise 4.8% next year after rising 3.6% this year.
“With meaningful cost increases coming, employers are not sitting still,” said Lindsey Hunter, senior director of Health & Benefits, WTW. “For now, they remain committed to providing retirees with health care benefits and a positive retiree experience. But they are looking for ways to provide it more cost-effectively. Employers are genuinely concerned about this increased burden and are considering all options, including private markets.”
Health care changes for retirees
The survey also indicated that 13% of all respondents expect changes to medical benefits for retirees over the next three years. About 49% expect they will make a change because the benefits are too expensive, while 36% are looking to address unacceptable financial risks and 33% want to reduce the administrative burden of the plan.
Another finding is that 22% of respondents have either stopped offering a traditional group plan to early retirees or are considering an alternative. Of all those who stop offering a group plan, 75% are replacing it with access to individual insurance through a private marketplace.
Health care costs for retirees are becoming a growing problem for employers. With this in mind, more companies are looking for alternatives, including access to individual insurance through a private marketplace.
Health care tips
To help plan your healthcare, consider working with a financial advisor. Finding a qualified financial advisor doesn’t have to be difficult. Smart Asset Free tool It matches you with up to three financial advisors serving your area, and you can interview your own advisors at no cost to determine which one is right for you. If you are ready to find a counselor who can help you achieve your financial goals, let’s start.
If you are still young, be sure to find out How much medical care will you need in retirement? And start following a plan to get there.
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