Health care in retirement? (WWGRMD)

I'm 33 and I have 4-years active duty time under my belt with the Navy. I'm getting close to the cutoff point for the Naval Reserves. If I were to join and finish out my time in the reserves I would have healthcare benefits through the VA for the rest of my life and that got me thinking:

What are the health care costs like for a civilian in retirement? Would I be gambling my savings against my health if I were to pass on the opportunity for VA benefits?

Current retirement savings status:
I'm at the bottom looking up. I have a years salary socked away in my 401k and it took me 5 years to do it. My current contribution is 10% but I hope to bump that up as I rise through the ranks. Company matches about 6%. I have about a years salary in home equity, but don't know if we'll hold on to this house until retirement (we may move with work). If I stay this exact path, I think I can safely plan on having 8x my current salary in my 401k (estimating conservatively) and a house that's paid off by the time I'm 65.

On the flip side of the reserves are all the reasons I got out of active duty in the first place (long deployments, idiots with rank, etc)

Thanks

All I can say is that if I had it to do again, I would definitely serve in the military long enough to earn the healthcare benefits.

Civilian costs vary wildly. You will start hearing the differences in 3, 2, 1...

My current cost for me alone is $472 per month, and my employer pays about half. Myself plus my wife would be $992. Family would be $1441.

Most companies won't pay anything towards the family. My share of the family cost is $1181 per month.

But there are going to be a LOT of changes to healthcare over the next 30 years. No one can predict.

What I can guarantee you is that you and your family will not get better or less costly coverage as civilians than you will through the military.

Do you have a family, or plan to have one?

If your talking about a supplement to Medicare (pays the missing 20%) most people I know pay around the $500 mark.

If your talking about a supplement to Meducate (pays the missing 20%) most people I know pay around the $500 mark.

It also depends on the coverage you want. For us, a family of 4 on a BCBS Federal Employee plan it's around $650/mo

Your savings rate isn't adding up. If you have 1x salary invested now, that should be worth 4-8x (1.05^32 to 1.07^32) your current salary, inflation corrected, by the time you are 65... with no other investments.

In reply to mtn:

I do have a wife and a kid. Probably more kids on the horizon.

$500 - $650 a month wouldn't be "undoable". If the cost were to double in the next 30-years though then we'd be getting into a price range where I'd start getting nervous.

^^With that, I would be staying in the reserves. Healthcare costs are so uncertain in the next 5-25 years, that I would be extremely grateful to have that "backup" plan.

Hungary Bill wrote: What are the health care costs like for a civilian in retirement?

That depends on if you worked for a strong union in the 60s and 70s or not.

Mostly the answer is "what's retirement?"

In reply to Knurled:

No union, no pension, too young to be alive in the 60's and 70's

What's retirement? Who knows. Hopefully something more than just growing old.

My paternal grandfather solely worked so he could retire. Had a military pension, a Boeing pension, a house, and a motor home. He died of cancer 2-years later. I'd like to NOT go this route.

My maternal Grandfather has been retired now for almost 10 years and is still doing strong. A bit of a battle with leukemia though. He has a nice quiet house near a lake, plenty of work around the place to keep him busy, and a time share in Maui. I'd like something like that, but he got lucky with one helluva investor though and has funded 100% of their retirement with investment income from the sale of their house (about $220k) I don't think I can bank on doing the same.

Neither of my parents have two quarters to rub together with which to retire from.

I'd like a house that's paid for, a few car projects, and some vacation time.

This question comes up regularly on the expats forums I'm on when someone wants to bring their parents over. The highlights usually are:

Once you're past Medicare eligibility age, private health insurances gets extremely expensive compared to pre-Medicare insurance. Basically, if you're not worth several milion and have the investment income to go with that, you won't be able to afford it at all. Basically insurers don't want you once you could go on Medicare and make the premiums punitive.

Depending on how the whole healthcare situation plays out, you may be better off having access to VA healthcare even pre-retirement. The health plans offered by employers aren't exactly getting any better or cheaper (which isn't the employer's fault) and some employers have started to move from a defined benefit model to a defined contribution one.

I wouldn't count the equity in the house against anything, for two reasons. First, you can't eat it, at least not without selling the house and moving into a tent. Second, depending on when you bought you may have caught the way above average upswing in houses in the last few years so you can't really project similar growth going forward.

SVreX wrote: All I can say is that if I had it to do again, I would definitely serve in the military long enough to earn the healthcare benefits.

don't have much to add to the rest of what you said …

but the thing about serving long enough to earn VA benefits … it's been a long time since the VA has offered open enrollment to non-retired/disabled veterans

I got in with about a month to spare (a major league procrastinator I am …LOL)

that was something like 8 -10 yrs ago

the amt. of time needed in the service (without extraordinary circumstances) would be … retired … so 20 yrs min.

there is a formulae for figuring how long you have to spend in the reserves to retire, don't know what it is, but it's not 1yr = 1yr

but if I were the OP, I'd do my time in the reserve … ESPECIALLY if the VA near you is one of the better ones

can't remember who it is (Javelin maybe … PNW anyway) that has what he considers a lousy one) … I on the other hand have what has to be one of the better ones …. lucky me

but, regardless … the benefits of VA coverage should be worth the BS of staying in the military

just my 2¢ worth ….

Over 65 on Medicare. Out of pocket cost is $36.90 per month. Some deductibles exist. This does not count the $94 I never see from SS for part B.

Being in the reserves/guard gives you access to Tricare reserve select, which is better than most insurance plans.

You'd have to either be a combat veteran, or do 20 years to get VA benefits. If you're a veteran, you should already have VA access. For VA purposes, one year in the reserves is one year.

Deployments suck. Don't do it if you and your family can't handle you possibly being gone for a year or more.

There are some green weenie moments in the reserve component, but, for the most part, it gets more of the good from active duty with less of the mind numbing parts. Also, more of the idiots with rank tend to be older than their active duty counterparts. This is usually a good thing, because a 25 year old doesn't have any business being in charge of anything.

rotard wrote: Being in the reserves/guard gives you access to Tricare reserve select, which is better than most insurance plans. You'd have to either be a combat veteran, or do 20 years to get VA benefits. If you're a veteran, you should already have VA access. For VA purposes, one year in the reserves is one year. Deployments suck. Don't do it if you and your family can't handle you possibly being gone for a year or more. There are some green weenie moments in the reserve component, but, for the most part, it gets more of the good from active duty with less of the mind numbing parts. Also, more of the idiots with rank tend to be older than their active duty counterparts. This is usually a good thing, because a 25 year old doesn't have any business being in charge of anything.

What he said. I had about 10 years in between Active Duty and the Guard when my first child was born and my wife did not like the idea of me being sent to the sand box so I did not reenlist. 4 years later with Medical benefits on my mind I went back and have about 14 months to go. Tricare RS is nice to have and knowing that my wife and I will have medical benefits have made it worth while but it is still a pain in the butt from time to time. I also can not wait to be able to take space A flights with my wife, should make for some great vacations on the cheap.

I did 8 years in the coast guard, seperating in 2010. I do not have any service connected disability, and was never deployed to a combat zone.

Early this year, as the ACA deadlines were approaching, I received a flyer from the VA offering health insurance for any veterans. I investigated further, and with my income level, I qualified for no premium care, though there is a small co pay.

If you are a vet, check it out if you have a va center near you (I do). I don't think they offer family plans, but as I am single and childless, I did not look for any of that.

Thanks guys. With everything above SWMBO and I just had a big "cost vs benefit" chat of joining the reserves.

I can tell already she's leaning towards a big "no" but we both decided there are a couple things we need to look into before finalizing the decision:

1) we need to have a chat with my grandfather (the one with the leukemia problems) and find out how that went, what it cost, etc. I figure that'd give us a good example of a "worst case".

2) I need to talk to the VA and find out if I qualify as a combat veteran (I'm thinking I may). If that's the case, I need to find out what benefits that may entitle me to.

SWMBO's reasoning for leaning "no" is:

• short deployments would be ok, but I'm already obligated to travel for work. Adding deployments to that obligation would be "stressful". A deployment of over a year would be near "unbearable" (Rotard's post reminded me that deployments with the Navy were seldom as short as planned, and they required months of workups before hand).

• She'll be done with her degree in the next two years. Having her income would easily double our retirement and savings allotments (currently we're a one income family).

• In less than 5 years there is the possibility that I'll make the move into the engineering department where I work. That should increase my income nearly 15-25% (which again allows more for savings / retirement)and raise the ceiling for potential earnings.

Thanks again everyone

I'm just going to leave this here, since there are other veterans on the forum:

http://www.va.gov/healthbenefits/

Some highlights: -If you served in the active military, naval or air service and are separated under any condition other than dishonorable, you may qualify for VA health care benefits.

-Many Veterans qualify for cost-free health care services based on a compensable service-connected condition or other qualifying factors

-You do not have to have served in a combat zone for health care (I didnt)

-It's probably not going to cover your family unless you have a service connected disability, but if your are covered, that's less you have to pay a civilian insurance company.

Hope that helps.

Talk to a VA case manager indeed. Every VA care vet I know who's age eligible has been transferred out of VA care and into Tricare. They are not the same. Only those with specific VA covered disabilities are still directly covered by the VA. This has been especially painful for surviving spouses in my observations as the list of coverage greatly diminishes.

VA care for you and your family is not inherently free and has not been so for many years. There is cost share and it's based on your income.

Convenience is not a strong point of VA care. Just because there is a facility nearby does not mean that is the facility you will be sent for particular care. They may instead schedule appointments for you at facilities or practices several hundred miles away. You can argue and reschedule, and sometimes win. But that will put you back several months at best.

My wife is rated 80% service-connected disabled, so her healthcare is 100% provided by the VA. That said, they bill our family health insurance first, then cover whatever deductible isn't paid. She's also a VA employee, so she knows how it operates on the inside. As stated above, getting free healthcare for spouse or family is very rare/unlikely, and is only offered in a few specific circumstances(I don't remember the details, but I'm thinking POW may be one case?).

The quality of staff & service seem to vary widely from facility to facility. Our local hospital(Danville, IL) is pretty good, and the one over in Indy seems to be good as well, but others don't rate as highly. The VA has also reduced the services offered at many of the smaller clinics. Sometime this requires a patient to travel(up to several hours each way) for appointments at the nearest VA hospital, but other times they will be allowed to see a local non-VA provider. Patients are reimbursed for milage for their visits however.

If anyone has any specific questions, I'd be glad to pass them along to her.

foxtrapper wrote: Talk to a VA case manager indeed. Every VA care vet I know who's age eligible has been transferred out of VA care and into Tricare. They are not the same. Only those with specific VA covered disabilities are still directly covered by the VA. This has been especially painful for surviving spouses in my observations as the list of coverage greatly diminishes. VA care for you and your family is not inherently free and has not been so for many years. There is cost share and it's based on your income. Convenience is not a strong point of VA care. Just because there is a facility nearby does not mean that is the facility you will be sent for particular care. They may instead schedule appointments for you at facilities or practices several hundred miles away. You can argue and reschedule, and sometimes win. But that will put you back several months at best.

as I've pointed out about how happy I am with my VA here, I'll also say that I've never run into this problem … thankfully. not sure if it's because I haven't needed any tests that they don't have the equipment for or what

and since all I have behind me is my 4 yrs service, I am on cost share … (I'm WAY to rich...where's the sarcasm emotion ?) for free care … but so far (10 yrs worth) the only bills I've received have been for $20, twice … both times for nurse practitioners that had their services coded in such a way that my ins. co. didn't pay anything … otherwise, what ever my ins. co. has paid has been accepted as my co-pay

this includes (just the higher priced stuff) nuclear radiology, nuclear stress test, regular stress test, and cardiac catheterization …..

and I've a brother that retired from the AF, lives in Biloxi, and utilizes Tricare … seems happy with it for him and his wife

as for me getting swapped over to Tricare… can I assume that won't apply ? since I'm NOT a retiree ?

You're 33? Health care?

Stock up on ammo!

Move. I've lived in Toronto the past four years. Do you know how many times I've had to think/worry about healthcare since? Zero. Move jobs, no problem. There's no such thing as pre-x condition. You could not pay me to go back to a private insurance system (even considering the future challenges here).

In reply to 1988RedT2:

Got plenty I've almost got my reloading operation up and running! All I need now is powder, and primers.

In reply to Ted:

SWMBO did bring up the idea of retiring abroad... I'm game, but that's a bit of a "we'll see". There is also the potential of moving over seas again within the next five or so years. That had to be taken in consideration with the "reserves or not" conversation.

I tell ya, 30-years is hard to plan for