Retirement Healthcare for Middle-Income Americans

Planning for healthcare in retirement is one of the “wild cards” for Boomers and seniors. Poor health can strip people of the enjoyment of their retirement years and their quality of life. Financial fallout from healthcare-related expenses can devastate savings.

In this new health and retirement study, the Bankers Life and Casualty Company Center for a Secure Retirement reports findings from middle-income Boomers and seniors on their health care retirement planning outlook including:

  • Their view of the connection between health and retirement satisfaction
  • The financial challenges of healthcare reform
  • How retirees are planning for health care costs in retirement
  • Their experience with Medicare and their challenges with understanding Medicare
  • The expectations of middle-income Baby Boomers approaching Medicare age

Key Findings

Virtually all (98%) of middle-income retirees state that good health is extremely or very important to a satisfying retirement.

Nine in ten (93%) middle-income Americans age 47 to 75 feel they have a greater awareness of healthy living now than when they were in their 20s.

When it comes to healthcare in retirement, Alzheimer's disease is the number one health-related fear of aging for middle-income Americans age 47 to 75, approximately twice which of cancer or heart attack.

Middle-income Americans age 47 and older are concerned about the future of Medicare (87%) and most believe the federal government will cut back Medicare benefits (71%).

There are many financial challenges of healthcare reform for Boomers. Half (51%) of middle-income Americans age 47 and older do not know if healthcare reform will benefit them; more than one-third (36%) say reform will not benefit someone their age.

Eight in ten middle-income Americans with Medicare are extremely or very satisfied with Medicare's access to healthcare (81%) and with the quality of healthcare Medicare provides (83%).

When it comes to understanding Medicare, two-fifths (42%) of middle-income Americans with Medicare feel that their overall understanding is extremely or very good, but there are meaningful gaps in their understanding.

  • One in three middle-income Americans with Medicare still do not know how much the program covers for doctor visits (33%) or hospitalization (31%).
  • There is confusion among many Boomers when it comes to Medicare long-term care coverage. Two out of three (66%) middle-income Americans with Medicare do not know if Medicare covers long-term care or overestimate its long-term care coverage.
  • Not understanding Medicare coverage can lead to not taking advantage of all benefits provided. Less than half (42%) of middle-income Americans take advantage of Medicare's annual wellness visit.

Many Boomers face financial challenges in healthcare. Two-thirds (65%) of middle-income Americans report paying the same or more for healthcare now that they are on Medicare.

Middle-income Americans with Medicare cite long-term care in a facility (48%) as the top healthcare expense that they feel threatens their retirement financial security.

Many Boomers struggle with understanding Medicare coverage. More than half (56%) of middle-income Boomers age 47 to 64 report knowing little about the Medicare program, with one in four (26%) admitting to knowing almost nothing about Medicare, even those within a few years of turning 65.

More than one-quarter (27%) of pre-Medicare age Boomers could not venture a guess as to how much they think they will pay for healthcare once on Medicare versus what they pay today. One in seven (13%) Boomers under age 65 falsely believe Medicare is free.

Featured Charts & Data