Healthcare

Here’s the Average American’s Annual Medicare Bill 

Is over $15,000 on average affordable health care for an American couple age 65 plus? A couple turning 65 today no purchasing supplemental coverage no Part D coverage could daily have premiums alone costing $8,976 per year. 

The short answer is that the average American with “original Medicare” (Parts A and B) can expect to pay a total of $7,620 out of pocket for healthcare expenses this year. However, that number doesn’t tell the whole story. Some of this amount comes from Medicare premiums, and some includes various costs such as prescription medications. In addition, total healthcare costs vary considerably by age and overall quality of health.

Source: Here’s the Average American’s Annual Medicare Bill — The Motley Fool

What is really curious is that a couple age 60 earning what many on Medicare earn could be paying far less in total costs when the premium tax credit and the supplemental assistance with out-of-pocket costs is considered. 

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4 replies »

  1. Mr. Quinn, thanks for the link to the Motley Fool article. The breakdown of health care costs according to age and health condition was especially revealing. The demographic tsunami now just arriving on Medicare’s shores will be with us for decades, and the worst part is, it grows stronger with time, not weaker. The health care cost meter starts spinning faster the older we get. And life expectancy continues to increase.

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  2. I truly do not understand Medicare and I am only starting to pay attention to it. Medicare for me is still 10 years away and hopefully it will look almost the same.

    But what I got out of this post and related article is that one should expect to pay at least 24% of their retirement income (assuming $50k income) on medical, maybe more unless you are in good health then you might only pay 14% for that good year. But since you never know when you’ll get cancer or have that heart bypass, you should plan on 24% every year unless proven otherwise at the end of the year.

    Am I off base on this all you retirees and ex-benefit managers? Are these good numbers to use for planning purposes? Any personal experiences?

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    • Well, you can count on a Part B and D premium and unless you have employer paid supplemental coverage (unlikely), you can count on that premium. Add them up and you get about $430 per month per person (in 2017) without spending a penny on health care. However, depending on the supplemental policy; the out of pocket costs could be minimal. The big unknown is the costs of drugs. Having said all that, just about anything can happen in the next ten years

      Also, depending on your total income at retirement, your Medicare premiums could be much higher.

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  3. That is how vote-buying (creating new entitlements) is SUPPOSED to work. What did you pay for the 3/4ths of the premium for Part D and for other expansions of Medicare benefits for new technology, inflation and new benefits and subsidies?

    Surprised to see that all the D’s have to do to get old people’s votes is run an add throwing grandma in a wheelchair over a cliff? They have most old folks – need to buy votes from young folks who need coverage under Dad’s health plan, or student debt foregiveness.

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