How can I avoid medical debt in retirement?
Medical costs weigh frequently on retirees’ minds, but there are several ways you can limit what you owe or avoid it altogether.
- Invest in a Medicare supplement plan. Because Medicare still requires you to pay off your deductible and has a copay, enrolling in a secondary insurance plan may help fill the gaps in your current coverage. Just keep in mind that you’ll pay a premium on private insurance on top of your normal Medicare coverage.
- Negotiate your bill. Medical bills often aren’t set in stone, and they can come to you riddled with mistakes. Carefully review each of your medical bills. If you notice anything wrong, speak up. And if you think you’re overpaying, your healthcare provider may be willing to negotiate the total amount owed for a single lump sum payment.
- Sign up for a payment plan. Healthcare providers often offer payment plans and in-house financing options for their patients. If you can’t afford to pay your bill, reach out to your provider and ask if there is an option to break it into more affordable payments over the coming months.
- Continue building your savings. Your HSA account — in addition to other savings — is a great way to avoid borrowing money for medical bills. Focus on maximizing contributions so that you can draw on it to cover copays and your deductible.
- Avoid high-interest debt. While it may be tempting to use a credit card or short-term loan to cover smaller bills, interest costs can quickly balloon out of control when you’re on a fixed income. Instead, look into secured and unsecured personal loans, both of which tend to have lower interest rates.
If you find yourself dealing with unavoidable bills, there are some steps you can take to make medical debt more manageable.
