Controlling health care costs in retirement

From pursuing a lifelong dream to reinventing yourself, retirement is meant to be a time of excitement and enjoyment. But there may come a time when health or financial matters will get in the way of your plans. If you’re like many retirees, as you get older your two most pressing issues will be health care costs and retirement savings. The Medicare plan you choose impacts both.

The need to choose a Medicare plan wisely

Looking for a Medicare planHealth care costs for an average retiree can be significant. According to Fidelity Investments, a 65-year-old couple retiring this year will need an average of $260,000 to cover medical expenses throughout their retirement.1

It’s also important to consider time spent (or saved) when exploring health plans. In 2010 Americans spent 2.4 billion hours seeking health care according to a study published in The American Journal of Managed Care.2

But there are steps retirees can take to choose their health coverage wisely. Medicare open enrollment — called the Annual Enrollment Period or AEP — is a great time to reevaluate your health plan. You may find you can save time and money with a Medicare Advantage plan.

The advantages of a Medicare Advantage Plan

Karen Lewis-Smith, Kaiser Permanente Washington’s executive director of government programs, emphasizes how important it is to look at your options. “This is a great time to consider your financial situation and how you expect to use your health plan. Then identify the plans most aligned with your requirements. Make sure Kaiser Permanente Washington’s Medicare Advantage plans are part of your assessment. They’re designed to meet the needs of as many Washington seniors as possible.”

Kaiser Foundation Health Plan of Washington Medicare Advantage (HMO) plans bundle your Medicare benefits together. This includes parts A, B, and sometimes D for hospital, medical, and prescription drugs, respectively. You get everything that’s covered under Original Medicare plus extra benefits such as vision, hearing, and dental. A Medicare Advantage plan also limits your out-of-pocket expenses each year, which helps make your overall expenses more predictable.

Evaluate your health care needs

Unfortunately, there’s no simple way to compare health plan costs. For instance, some plans may have lower premiums but higher out-of-pocket expenses, or vice versa. Your unique health and financial needs should be part of any plan evaluation.

During open enrollment, take a good look at what’s going on with your health and your health care costs when deciding whether to stay with your current Medicare plan or choose a different one.

Here are questions to ask yourself to help evaluate your health care needs:

  • Where have most of your health care costs come from so far? Are premiums your largest expense or have out-of-pocket costs been a bigger burden?
  • Have you had years when your out-of-pocket health costs were a lot more than you expected? If so, a Medicare Advantage plan limits your annual expenditures. So you’ll know that, in any given year, your medical costs (excluding prescription drugs) won’t exceed a predetermined amount.
  • Do you have a chronic condition that requires you to use the health care system frequently? Or are you a generally healthy person who doesn’t need to visit the doctor that often?
  • If you were to have major health crisis, how much could you afford to pay out-of-pocket?
  • What prescription drugs do you take? What are your out-of-pocket costs for your prescriptions?
  • Do you require non-Medicare covered services such as acupuncture, hearing aids, glasses, or contacts?  What about a fitness membership? Kaiser Permanente offers fitness memberships at no extra cost.

Switch to Kaiser Permanente

Evaluate your health plan options

Assess your current and potential health care needs. Then weigh them against the financial costs and benefits of health plans you’re considering. Take into account the financial risk you’re willing to take.

Questions to consider include:

  • How much is the monthly premium?
  • How much will you pay for each visit or service?
  • Does the health plan have a yearly deductible, or any other deductibles? If so, how much are they?
  • What is the annual limit on out-of-pocket expenses for all medical services?
  • Are dental, vision, and hearing covered by the plan?
  • Are you comfortable with the choice of doctors available in the plan?
  • What is the quality rating of the plan?

Medicare Advantage plans can simplify this complex evaluation because you’re covered by a single, plan rather than by multiple plans such as Original Medicare, a Medigap plan, or a Medicare Part D standalone plan. More importantly, many people find that a Medicare Advantage plan makes the most financial sense.

One helpful tool for comparing Medicare health plans is the Find a Plan page on the Medicare website. This tool includes information about prescription drug coverage, deductibles, copay and coinsurance amounts, out of pocket spending limits, and estimated annual costs.

A look at plans in Washington state shows that Kaiser Permanente offers a number of Medicare Advantage HMO plan options at competitive prices.

And you can have the best of both worlds — competitively priced plans that are also highly rated. For our 2018 plans, Kaiser Permanente Washington Medicare Advantage received a 4.5 star rating out of 5 from Centers for Medicare & Medicaid Services.*

Saving time with a Medicare Advantage HMO plan

Kaiser Permanente Medicare Advantage plans are designed to simplify your care, allowing you to spend more time doing the things you love. Here are some of the ways Kaiser Permanente Washington Medicare Advantage HMO can save you time:

Coordinated, connected care: From managing a health condition to prescription refills, Kaiser Permanente Medicare HMO coordinates your care so you don’t have to. Electronic medical records allow your entire care team to have up-to-the-minute information on your health. All to help keep you at your healthiest.

Simplified billing: Medicare can be complex, especially when you are covered by a number of plans. Our care and coverage model simplifies your care by streamlining billing and account management.

Quick, convenient customer service: Kaiser Permanente Washington has locally based member service. With specialized training in Medicare, our team provides personalized service with just one number to call.

Care your way: Kaiser Permanente saves you time in other ways, too. Our Consulting Nurse Service allows you to call 24/7 for medical advice and information. And you can walk into CareClinic by Kaiser Permanente at Bartell Drugs for minor medical conditions. You can find CareClinic at 15 locations in the Puget Sound region.

A new Medicare Advantage health plan may lower your costs

If your current Medicare coverage is costing you too much time or money, don’t be afraid to look at other options. You can probably do better. Take a fresh, detailed look at your health needs and your health plan options, and don’t forget to include the Kaiser Permanente Medicare Advantage HMO in your selection process.


1 Retiree health care costs continue to surge. Posted online August 8, 2017 by Fidelity Viewpoints on fidelity.com. The statistics presented are not issued or endorsed by Medicare. Kaiser Foundation Health Plan of Washington is not affiliated with Fidelity Investments.

2 Opportunity Costs of Ambulatory Medical Care in the United States. Published in the American Journal of Managed Care. 2015; 21(8): 567-574. The statistics presented are not issued or endorsed by Medicare. Kaiser Foundation Health Plan of Washington is not affiliated with the American Journal of Managed Care.

* Centers for Medicare & Medicaid Services Health Plan Management System, Plan Ratings 2018. Kaiser Permanente contract #H5050.  Medicare evaluates plans based on a 5-Star rating system. Star Ratings are calculated each year and may change from one year to the next.

Kaiser Permanente is an HMO plan with a Medicare contract. Enrollment in Kaiser Permanente depends on contract renewal.  You must reside in the Kaiser Permanente Medicare health plan service area in which you enroll. This information is not a complete description of benefits. Contact the plan for more information. Limitations, copayments, and restrictions may apply. Benefits may change on January 1 of each year. You must continue to pay your Medicare Part B premium and any other applicable Medicare premium(s), if not otherwise paid by Medicaid or another third party. The provider network may change at any time. You will receive notice when necessary.

Medicare eligibility is not limited to age and there are other eligibility criteria by which one could qualify for Medicare.

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Page last updated: 10/20/2017