Medical costs are among the top financial worries of Americans, yet there are steps that people can take to avoid crippling medical debt in their retirement years. That’s according to Danielle Kunkle, co-founder at Boomer Benefits, who published an article on Forbes.com, titled How To Avoid Medical Debt In Your Retirement.
The biggest thing to know is to sign up for Medicare on time. “There are significant penalties for late enrollment into Medicare,” wrote Kunkle. “These penalties accumulate the longer you wait to enroll and can be very costly. You can avoid penalties by signing up for Medicare when you are first eligible.”
People should also consider covering the gaps in coverage by purchasing Medicare Advantage or other Medicare supplements that provide coverage for health-care services not covered by traditional Medicare.
By examining their medical bills closely, individuals are protecting themselves from being overcharged. “Don't assume that your medical bills are correct,” advised Kunkle. “In fact, billing errors are so common that we ask our policyholders to send them to us for verification before they pay them.”
People are encouraged to continue to add to their health savings account (HSA), if they are still working. Depending on the qualified employer health plan individuals should do everything they can to max out the annual contribution. Money that they contribute to this account is a tax write-off. They can then later use these funds to pay for medical expenses in retirement.
Life happens and sometimes people do incur significant medical expenses. It is strongly encouraged to not charge them to credit cards. This is where people will incur additional finance charges as they work to pay them off. Individuals should speak with their medical provider to ask for a payment plan that is paid directly to the entity that is owed. This is usually an interest-free solution.
Making wise healthcare decisions, by planning ahead, hopefully individuals can avoid medical debt that would otherwise put strain on their golden years.
Marc has 36 years in financial services and 6 years in teaching.
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