Medicare helps pay for the medical bills of nearly all Americans over age 65. But Medicare doesn’t cover every service that seniors need and many people face significant out-of-pocket costs while enrolled in the program.
A 65-year-old couple enrolled in traditional Medicare, a Medicare Part D prescription drug plan, and a Medigap plan is likely to need $158,000 to have a 50 percent chance of having enough money to pay for all of their medical expenses throughout retirement, according to a new Employee Benefit Research Institute analysis. Retired couples who want a 90 percent chance of being able to pay all their bills should aim to save $271,000.
These estimates have been revised significantly downward since last year’s calculation largely due to recent health care reform legislation that will eliminate the coverage gap in Medicare Part D by 2020. EBRI calculated last year that a 65-year-old couple in 2009 would need $210,000 to have a 50 percent chance of affording their retirement medical needs, $52,000 more than retirees will need once health care reform is fully implemented.
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