What does Medicare Cover? Should I Consider Long-term Care Insurance?

Before you can address these costs, it's important to understand what Medicare and other insurance covers. We can help you do just that – so you can make the decisions that are right for you. In general, you’ll have two types of medical expenses when you retire: traditional and long-term.

Traditional medical expenses

Medicare is designed to cover traditional expenses, such as doctor’s visits, prescriptions, in-hospital expenses and wellness exams. However, you’ll still need to budget $4,000 to $6,000 a year to cover out-of-pocket costs Medicare doesn’t pick up – including the premiums and deductibles as well as any supplemental insurance.

Below is a quick overview of Medicare Parts A and B costs and coverage. 


Please refer to www.medicare.gov for more information or to determine if specific items are covered.

Medicare doesn’t cover most long-term care costs

Of all the expenses Medicare doesn’t cover, long-term care is potentially the biggest. This type of care includes nursing homes, assisted living, in-home health care and adult day care. Costs vary according to the type and amount of care, but the price tag can add up: Using an average nursing home stay of 2.5 years, you’d need more than $200,000 in today’s dollars to cover this cost – and that doesn’t include the effects of inflation.

You can pay for long-term care by adding these costs to your budget or insuring against them. If you decide to pay for them out-of-pocket, your financial advisor can look at your entire financial picture and help you determine if your portfolio can withstand this potential cost.

Another option is to purchase some form of long-term care insurance. The policies and costs can vary dramatically, however, based on your age, health and gender, as well as the amount of coverage you desire.

Your financial advisor can help you evaluate the following:

  • Amount of coverage – Look for a policy that offers the highest amount of long-term care coverage relative to other options, assuming the same premium.
  • Potential for rising premiums – Insurance companies can raise their premiums even after you’ve purchased a policy. Make sure you read the fine print. Your financial advisor will work with you to make sure you understand all of this.
  • Benefit of insurance vs. the “risk” of not needing it – As with any insurance policy, there's always the possibility that you’ll pay for coverage you’ll never use. But given the large potential costs of a long-term care stay, it’s important to weigh the cost of insurance with the risk of needing care and not having coverage to pay for it.

    Health care costs are important, but they are also just one of many factors to consider when you look at your retirement picture. That's where your financial advisor comes in. By getting to know you and your whole financial picture, together you can work on a personalized strategy that works for you.

How we can help

Your financial advisor can look at your entire financial picture and help you determine what solution may be right for you.

Important Information:

Edward Jones operates as an insurance producer in California, New Mexico, and Massachusetts through the following subsidiaries, respectively: Edward Jones Insurance Agency of California, L.L.C., Edward Jones Insurance Agency of New Mexico, L.L.C., and Edward Jones Insurance Agency of Massachusetts, L.L.C.

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