Medical expenses have been rising despite the recession and they have become one of the biggest burdens faced by people in the post retirement phase of their life. Financial experts have tried to educate the public about the need to plan for medical expenses but very few people in the U.S. do any kind of future planning for medical bills that are likely to pile up as they grow older and lose some of the benefits that come with employment.
This problem has become so acute that some people have been forced to declare insolvency because of the health expenditure. And the problem is not restricted to the old. This highlights the urgent need of accounting for health expenditure while planning your financial future.
The best way to plan for health expenses is to stay covered. It makes sense to look for a plan that has high deductibles, as the first and foremost reason for coverage is treatment for health emergencies that you wouldn’t be able to afford, and not those which you can easily pay out of your pocket. If you are healthy then a high deductible plan would significantly lower your premiums, which could be a profitable strategy in the long run.
Another advantage is that various preventive health measures such as physical check ups might be fully covered by the plan. The number of such plans available in the market has increased manifold in the past few years, so you have a lot of choice as well.
If you enjoy good health, you can extract the maximum benefit from these high deductible policies by opening a health savings account. You can save money regularly and no tax would be levied on the deposits. Any unused portion can be withdrawn after you retire.
When looking for health coverage, you should avoid policies that have a yearly or lifelong upper limit on the amount they will pay for your medical bills. If you do not consider this aspect, then you might end up with a plan in which you invested a lot of money and it still does not completely cover the costs of treating a serious condition.
Remember that the premium for health plans becomes higher when you grow older as insurance companies start seeing you as a risky profile. Similarly, if you have a pre-existing condition, the insurance company might simply refuse coverage. So get coverage before it becomes too expensive and while you are completely healthy.