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Health Insurance and Retirement

published September 10, 2007

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( 2 votes, average: 4 out of 5)
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<<To enjoy retirement, adequate savings are necessary. Some retirees plan to travel, while others anticipate spending more time with their grandchildren. No matter what you plan to do after completing your professional career, retirement planning is essential.

The average American today cannot expect to retire on Social Security and Medicare benefits alone. And because of rapidly increasing healthcare costs, it is more important than ever that Americans understand how to get the most out of their health insurance and the benefits available to retirees.

Large companies are more likely than small firms to offer retiree health benefits. However, compared with the situation in the 1980s, there has been a dramatic decrease in the number of large organizations providing retiree health benefits. The specific retiree health benefits provided by an organization depend on its size, the industry it represents, and whether its workers belong to a union.

The findings of the 2006 annual survey of employee health benefits conducted by the Kaiser Family Foundation and the Health Research and Educational Trust show that:
  • Only 35% of large firms (with 200 or more workers) that offer health benefits to their workers offered retiree coverage in 2006. This figure was 66% in 1988.
     
  • Large firms are more likely to offer retiree health benefits than small firms are. Of the firms that offer health benefits, 35% of large firms offer retiree health benefits, while only 9% of small firms offer such benefits.
     
  • State and local governments and utilities industries are more likely to offer retiree benefits compared with firms in other industries.
     
  • Large firms with unions are more likely to offer retiree health benefits than large firms without unions.
This survey shows that a significant number of people over the age of 65 do not receive retiree health benefits and must depend on Medicare if they have not provided for themselves by other means. Therefore, retirement planning must provide for adequate health insurance coverage as well as adequate savings.

published September 10, 2007

( 2 votes, average: 4 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.