Costs include Medigap coverage, which fills in some holes in Medicare coverage. Image: ANDREI ASKIRKA/Shutterstock.com
By: FEDweek StaffA report from the Employee Benefit Research Institute cautions against under-estimating the long-term costs of Medicare coverage.
The report looked at costs including premiums, deductibles and prescription drug coverage in terms of how much money someone would need to have saved at age 65 when eligibility for Medicare typically begins.
It said a man would need to save $96,000 in order to have a 50 percent chance of having enough to cover premiums and median prescription drug expenditures, and a woman would need $116,000. To rise to 90 percent confidence of covering those costs, the figures rise to $166,000 and $197,000. In both cases the difference by gender is due to the overall longer average life expectance for women.
Those figures include the cost of Medigap coverage, which fills in some holes in Medicare coverage. Many federal retirees do not elect Medigap because they have FEHB coverage that serves the same purpose; however, FEHB too comes at a cost.
A summary of the report added: “In the future, despite the introduction of the cap on Part D out-of-pocket spending, individuals may have to pay greater shares of their overall health costs in retirement because of the financial condition of the Medicare program and cutbacks to employment-based retiree health programs.”
Shutdown Meter Ticking Up a Bit
Judge Backs Suit against Firings of Probationers, but Won’t Order Reinstatements
Focus Turns to Senate on Effort to Block Trump Order against Unions
TSP Adds Detail to Upcoming Roth Conversion Feature
White House to Issue Rules on RIF, Disciplinary Policy Changes
Hill Dems Question OPM on PSHB Program After IG Slams Readiness
See also,
Legal: How to Challenge a Federal Reduction in Force (RIF) in 2025
The Best Ages for Federal Employees to Retire
Alternative Federal Retirement Options; With Chart
Primer: Early out, buyout, reduction in force (RIF)
Retention Standing, ‘Bump and Retreat’ and More: Report Outlines RIF Process
