Retirees' Health Care Costs Will Increase 8.6% Over Next 15 to 20 Years, USA Study

Main Category: Seniors / Aging
Article Date: 30 Mar 2005 - 11:00 PDT

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For a US couple retiring at age 65 without private health insurance through a former employer, out-of-pocket health care costs will increase to $190,000 over the next 15 to 20 years, according to an estimate by... Fidelity Investments, Bloomberg/Long Island Newsday reports. The projection marks an 8.6% increase from last year's estimate of $175,000 in out-of-pocket costs. Fidelity estimates that about one-third of the $190,000 will be spent on prescription drugs and another third will go toward Medicare premiums for physician care and medications. The estimate does not include the costs of nursing home care, most dental services or over-the-counter medicines. Brad Kimler, senior vice president of health consulting for Fidelity Human Resources Services, said, "Medical costs are one of the most critical risks to eroding your retirement savings, and the longer your retirement, the greater your risk." A CMS report released last week indicated that Medicare premiums for physician care could increase 12% next year to $87.70 per month, with a separate $37.37-per-month premium for prescription drug coverage (Bloomberg/Long Island Newsday, 3/29).

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