Why we are budgeting for retiree medical costs


In a Globe and Mail article last year Anna Sharrat reported that according to a 2014 BMO Wealth Institute Report, without private coverage, Canadians can expect to spend an average of $5,391 a year on out-of-pocket medical costs after 65. And these numbers will rise.

My husband and I have excellent retiree health benefits that were part of the retirement package from my former corporate employer. But recent visits to the optometrist and a new dentist brought home to me how many other out-of- pocket medical expenses are not paid for by our plans.

I guess i had been putting off a visit to the eye doctor because I was not looking forward to the cost of new glasses. OHIP paid for the examination but retinal imaging my doctor recommends cost $45 which was not reimbursed by either our government or private plans. Getting new lenses for existing frames (progressive bifocals) and prescription sunglasses cost $948.

My trip to the dentist was also expensive. I stopped working downtown over 10 years ago but I continued to make appointments  at Yonge and Wellington until my dentist’s practice was sold and he retired.One of the new dentists in his former practice also has an office and Yonge and Finch which is walking distance from where I live, so I decided to have my files transferred.

The new dentist  recommended two crowns and bonding for four lower front teeth which were really thin because I grind my teeth at night. My plan pays 80% with no annual caps on dental charges based on the 2016 fee schedule. So I was surprised tor receive the following dental predetermination back from my insurance company.

Crown 1: $1,595 patient pays $501.40

Bonding:  $788 patient pays $263.20

It turns out that my dentist charges about 20% over the recommended (but not obligatory) ODA 2016 fee schedule, so instead of paying the 20% co-insurance, it looked like I would be on the hook for over 1/3 of the treatment costs. When I actually got up the nerve to ask if they had seniors’ rates, I was pleased to learn a 10% discount for patients over 65 is standard so my co-pay was reduced accordingly.

The insurance company took the view that the second tooth could be filled and agreed to pay only based on the lesser eligible  amount of $581.

Crown 2: $1,595 amount eligible $581 — based on filling patient pays $1,281

My dentist has appealed this determination on my behalf and I am waiting to decide what to do about this tooth until
I get back the results of the appeal. If the second crown is not approved, I will likely go with the less costly option and try having the tooth filled.

We are fortunate to have great post-retirement health benefits but still had over $1,000 in expenses this month alone. In years to come we will likely  have to pay for hearing aids, medical devices and drugs not covered by government or private plans. That’s why in spite of our public and private health plans, we are anticipating several thousands of dollars a year for increasing post-retirement health care costs .

Do you have retiree health benefits? If not, will you purchase private insurance? Whether or not you have private retiree coverage, how much are you budgeting for post-retirement healthcare?

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