Health care costs are rising far ahead of inflation in general.  Employee health insurance costs are increasing at around 15 percent annually and price inflation of drugs and medicine can increase as much as 20 percent in one year.  Even generic drug prices have radically increased recently.  In our opinion, the biggest risk retirees will face is the issue of health care costs, especially for the elderly.

            I personally know of elderly women who pay over $700 monthly for out-of-pocket drugs costs required for health problems.  When you combine the costs of medicine, home care, assisted living and nursing home costs, seniors face a growing risk of financial impoverishment.  Add to that equipment needed for the elderly such as walkers, hospital beds, electric carts, handicap ramps, handicap-equiped vehicle, stairway lift chairs and other important necessities for elderly people to maintain a quality of life, you begin to realize the seriousness of advanced planning necessary to have the retirement funds to remain in control during the later years of ones life.

            Several considerations are necessary when planning for retirement such as saving enough money, buying a Medicare supplement, catastrophic illness protection, long-term care insurance, asset protection strategies, money management to conserve assets, budgeting to avoid over spending, and getting an annual review of your finances is extremely important to maintain a sound retirement program.

            Government sponsored drug legislation may be on the way, but I would not count on it until it happens.  The cost of a government sponsored drug program will be massive.  Some authors state that new legislative proposals will still leave over $1,200 annually out-of-pocket costs to single senior and over $2,400 for a couple.  That still leaves $100 to $200 monthly out-of-pocket costs that will continue to erode retirees savings.

            Long-term care costs are especially troubling for the elderly because 24-hour professional care is projected to cost over $84,000 annually within ten years and accelerate to over $124,000 annually by 2030.  Retirees must address the issue of long-term care now before your choices narrow due to health problems.  While you are healthy you need to do your planning well ahead of a catastrophic health care problem. 

Women suffer more from the issues of aging because they provide over 70 percent of the care giving for parents, don’t usually have a pension, earn less money than men and live five to seven years longer than men.  Women should address asset protection and long-term care planning simply because they face even greater risks during their elder years. Husbands should care about this issue and assist their spouses more with the care giving responsibility.

Regarding the increases in health care costs and long-term care or nursing home expenses, you can do nothing about spiraling costs.  What you can do that will be positive is to learn more about your choices regarding ordering medicine from Canadian sources, asset protection planning, long-term care insurance or other planning needs.  The key to protecting yourself from health care costs is to do a lot of planning, reading and looking at all your choices.  Never stop reading about ways to reduce costs and health issues.