In the US, if you have health insurance through your employment, what happens when you retire?

If you retire before age 65 (and eligibility for Medicare), you may be able purchase health insurance at a relatively good cost from your former employer for 18 months through COBRA Coverage and Health Insurance Marketplace Options . After that you purchase health insurance on the open market.

There is a trade-off when shopping for health insurance. Ideally you would like low co-pays, low deductibles, and high lifetime caps, but if you choose that, your premiums will be very high. Most people opt for low premiums and then find that their insurance actually does not start to pay any of their health care costs until they have spent the amount of the deductible out of pocket (and the deductible can easily be more than $6000/year)

 

If you retire at or after age 65, you will transition to Medicare parts A (hospitalization) and B (medical). Part A is free and Part B requires a monthly premium (low compared to cost of health insurance on the open market). Many people also sign up for optional part D prescription drug coverage (again, you pay a monthly premium for this). Part D and any other “medigap” insurance you choose to augment part B are purchased through insurance plans such as the one run by AARP. AARP – Real Possibilities

US physicians are not required to accept Medicare, so you have to ask your providers whether they do accept it. MDs don’t like the paperwork. However, I recently spoke with a provider who has decided to accept only Medicare and not private insurance coverage, because the paperwork and paybacks from private health insurers were getting worse.

I know less about Medicare C – I think this is called Medicare advantage— this appears to combine Part B with things such as dental and vision that Part B alone does not cover, and usually is administered by an HMO (health maintenance organization) or POS (point of service plan). I think some people buy this instead of part B, for a higher premium than part B. What I didn’t like (if I understand this correctly) is that you may be limited to in-network providers, that is, those who “belong to” the HMO.

There are co-payments and lifetime caps on coverage for some things, and Medicare part B alone does not cover vision or dental.

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