Paying for Health Care in Retirement

8/8/2019 Paying for Health Care in Retirement

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Reporting Retirement:

Finding New Angles

Debra Whitman, Ph.D.

Chief Public PolicyOcer, AARP@DebAARPNational PressFoundation

June 8, 2015


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Health Care Costs


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Often Overlooked:Mediare !ene"iaries Aren#t $ealth%

&n 201'(

• Hal) had ino*e belo+

2',500 a %ear• Hal) had sa-in.s less than

/1,00

By Race Median Income MedianSain!"

!las 1/,'50 10,'00

Hisanis 1','00 3,'00

A*on. !las and Hisanis 4201'(

6oures( 7aiser Fa*il% Foundation, A Pri*er on Mediare 2015 7FF &no*e and Assets o) Mediare !ene"iaries,9


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Often Overlooked:!ene"iaries Pa% a :ot

#nde

r $%

$%&

$'

()&

(*

(%&

('

+)&

+*

+%

;otal

1?=5>

20=8>

2'=/>

23=2>

rden o)


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Bene-ciary Sendin! for Medicare, /ee&/or&Serice Only, by A!e

Annual

/5 to /3 ,1'? 8,//2?0 to ? 5,''5 10,51?5?3 5,0' 10,552808 /,0? 11,8?85 3,/3 13,180

6oure( 2011 MC!6 data, Publi Poli% &nstitute, 2015

Hi.h Mediare


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A*on. 50 +ith Retire*ent6a-in.s, MaBorit% Ha-e 6a-ed er%

:ittle

6oure( *lo%ee !ene"t Researh &nstitute and Mathe+ Ereen+ald Assoiates, &n=, 201 Retire*ent Con"dene 6ur-e%=

%) Oerall

0n1$(23

%) Wor4er"

0n122*3

%) Retiree"

0n122'3

*25 *)5 >

'5 (512>

6)5 675'5

(5 (5(5

6*5 6$5 665

6(5 6(5 6(5

250,000 or *ore

100,000 to

23,333

50,000 to

33,333

8early 9alf of %) Wor4er" : 2;%of Retiree" &9ae le"" than


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Gneeted Health Care ensesCan Derail Retire*ent Plans

Retiree" =ith =or"e than e>ected -nance" inretirement oint to?

@hin!" are more e>.en"ie than you e>.ected

Aou had une>.ected health or lon!&term care co"t"

Aour income i" lo=er than e>.ected

Aou had to .roide -nancial "u..ort to family member"

Aou are de.letin! your "ain!" more Buic4ly than e>.ected

Aou canCt aDord to do "ome thin!" you =ould li4e

Other

28>

22>

18>

1>

10>

1>

8>

6oure( *lo%ee !ene"t Researh &nstitute and Mathe+ Ereen+ald Assoiates, &n=, 201 Retire*ent Con"dene 6ur-e%=

9i!her than e>ected e>en"e" 07+53 and#ne>ected healthcare;lon!&term care co"t" 07753


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Part A: Helps payfor hospital bills

Part B: Helps payfor doctor bills

Part C: Coveragethrough private

plans, calledMedicare

Advantage

Part D: Provides

prescription drugcoverage

Medicare

Mediare Has Man% Parts

AARP Public PolicyInstitute


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Mediare &s Not IFree

AARP Public PolicyInstitute

( 2015 Part A and ! osts )ro* Mediare=.o- at htt(KK+++=*ediare=.o-K%our*ediareostsKinde=ht*le 2015 Part C and D re*iu*s )ro* 7aiser Fa*il% Foundation, +ei.hted b% enroll*ent, 201=

http://www.medicare.gov/your-medicare-costs/index.htmlhttp://www.medicare.gov/your-medicare-costs/index.html


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$hat Are !ene"iaries Pa%in. ForL


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/5 Households Pa%Proortionatel% More than under

/5 Households )or Health Care


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Presrition Dru.Costs


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Source: Kaiser Family Foundation analysis of National Health Expenditure (NHE) data from Centers for Medicare and Medicaid Services !ffice of the

"ctuary National Health Statistics #roup

G=6= Health Care 6endin. Per Caita HasRisen at Historiall% :o+ Rates &n Reent

ears

0>

2>

>

/>

8>

10>

12>

1>

12=0>

3=3>

5=5>/=1>

?=>

8=/>

?=/>

/=2>5=8>

5=5>5='>

'=8>

2=3>'=1>'=2>'=>

2=3>

'=?>=0>

=?>=?>5=1>

5=5>5=/>5='>5='>5=2>

Chan.e in 6endin.

nnual !ro=th rate of health "endin! er caita for 6'()E" F 6'')E"Gan!e in actual health "endin! 7))) F 7)62 and roHected 07)6* F 7)723


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$rescription %ru& $rices "re Hi&h and 'ncreasin&

2006 2007 2008 2009 2010 2011 2012 2013

5.7% 5.9%

7.9% 8.4%

9.1%

11.5%12.3%

12.9%

3.2%2.9%

3.8%

-0.3%

1.6%

3.1%

2.1%1.5%

Brand Name Drug Prices (227 top drug products) General Inflation (CPI-U)

Average Annual % Change

6oure( 6=$= 6hondel*e%er and := Pur-is, IR Prie $ath Reort( ;rends in Retail Pries o) !rand Na*ePresrition Dru.s $idel% Gsed b%


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"mericans $ay a ot More For heir$rescription %ru&s

United States er!an" United #ingd$! %ndia &g"'t

(84)000

(66)000

(57)000

(2)000 (900

Price of heatiti" C dru!Soaldi

6oure( D= $hit*an and := Pur-is, Iensi-e Ne+ Heatitis C Dru. Raises Alar*s, Hun.ton Post,

Ma% 28, 201=


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Current rends "re N! Sustaina*le

• Chole"terol dru!" no+n as PC673 inhibitors areeeted to enter the *aret later this %ear

o Prie ta.( J


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on&+erm Servicesand Supports


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SS Costs: " oomin& Expense at !lder "&es

200 2005 200/ 200? 2008 2003 2010 2011 2012 201' 201 201550,000

55,000

/0,000

/5,000

?0,000

?5,000

80,000

85,000

30,000

35,000

8ational Aera!e Annual Co"t" of 8ur"in! 9ome0Priate and Semi&Priate Room"3, 7))*&7)6%

6e*iPri-ate Roo*

Pri-ate Roo*

Source: Genworth Cost of Care, 2004 - 2015


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National 6endin. )or :;66

5>

12>

22>

/1>

K@SS L>enditure" by Source, 7)67


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Care.i-in.


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6i.ni"ant :;66 Pro-ided b%Fa*il% Care.i-ers

&n 201, about '=5 *illion G=6= )a*il% are.i-ersro-ided are to a )a*il% *e*ber +ith li*itationsin dail% ati-ities in the rior %ear=

8umber of Care!ier" and the Lconomic alueof Care!iin!Nu*ber o) Care.i-ers '=5 *illion 4201

A-era.e Care HoursK$ee 2= hours 4201

ono*i alue er Hour 11=1/ 42003

;otal ono*i alue 50 billion 42003

e( Care.i-in. in the G=6= 2015 aluin. the &n-aluable( 2011 Gdate o) ;he ono*i alue o) Fa*il% Care.i-in.


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ou too are o) Mo*, but +ho +ill tae areo) %ouL


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Hoe($or and 6a-e


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Thank you!

Debra $hit*an, Ph=D=Chie) Publi Poli%

Paying for Health Care in Retirement

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