Key Points
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While Medicare might pay for your hospital stay or certain screenings, there are plenty of costs it won’t cover.
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It’s important to know what expenses you might have to pay for on your own.
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Pad your savings so you’re equipped to handle these costs, and consider setting money aside for healthcare bills specifically.
There’s a reason many people work until age 65 before retiring. Age 65 is when Medicare eligibility begins. And retiring sooner could mean having to cover the cost of health insurance on your own.
But one big mistake retirees often make is assuming that Medicare will cover all of their healthcare needs. In reality, there are a host of expenses Medicare won’t pay for. Here are four that may surprise you.
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1. Dental care
Keeping up with your oral health becomes all the more important as you age. But Medicare won’t pay for dental cleanings or routine dental care. That’s a cost you’ll need to cover out of pocket.
The exception, though, is if you have a Medicare Advantage plan. These plans offered by private insurers do commonly pay for dental services, as well as other expenses original Medicare will not cover.
2. Eye exams
Need your eyes checked in retirement, or perhaps an updated pair of glasses? Sorry — Medicare won’t pay for that either.
However, if you sustain an eye injury, Medicare may pick up the tab for your treatment because it’s considered a medical issue and doesn’t fall under the umbrella of routine eye care. Medicare might also pay for certain eye disease screenings.
3. Hearing aids
Hearing loss is something many older people struggle with. Unfortunately, hearing aids are another thing Medicare won’t cover.
That said, if you experience hearing loss due to an injury, Medicare may cover the treatment. Medicare may also cover the cost of a hearing exam if it’s related to another medical issue you’re experiencing — for example, if you’re having trouble with balance.
4. Long-term care
If you’re injured or need to recover from surgery, Medicare will generally pay for a stay at a skilled nursing facility. But Medicare typically will not pay for a nursing home or assisted living facility, or even a home health aide.
The general rule is that Medicare will only cover expenses that are medical in nature. Home health aides, assisted living, and nursing homes tend to fall under the umbrella of custodial care, which is generally outside of Medicare’s scope.
How to cover your healthcare costs in retirement
Even if you choose the right Medicare plan, there’s a chance you’ll still face your share of health-related expenses during retirement. That’s why it’s important to have plenty of savings.
You might need your monthly Social Security benefits to cover costs like housing, transportation, food, and utilities. So having separate savings to cover healthcare needs could save you a world of financial stress.
You can always contribute extra to an IRA or 401(k) plan and use some of that money for health needs Medicare won’t pay for. Another option, if you’re eligible, is to fund a health savings account (HSA).
HSAs are available to enrollees in high-deductible insurance plans. The definition of that changes yearly, so you’ll need to check your plan to see if you qualify. If so, you can set aside funds for healthcare you can use in the near term or in the future.
The last thing you want is to get caught off guard in retirement when you realize there are many things Medicare won’t pay for. Do your best to read up on Medicare so you know what to expect.
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