Medicare Isn’t a Free Ride—And It Doesn’t Cover Everything
Many retirees assume that once they qualify for Medicare at age 65, their healthcare costs will drop significantly. Unfortunately, that assumption can lead to surprise out-of-pocket expenses and financial strain. While Medicare is a valuable benefit, it comes with coverage gaps—and failing to plan for them could put your retirement savings at risk.
Understanding what Medicare doesn’t cover—and how to protect yourself—is a crucial step in building a reliable retirement strategy.
The Most Common Gaps in Medicare Coverage
Medicare is split into several parts:
- Part A (Hospital Insurance): Covers inpatient hospital stays, limited nursing facility care, and hospice.
- Part B (Medical Insurance): Covers doctor visits, outpatient care, preventive services, and medical supplies.
- Part D (Prescription Drug Coverage): Offers optional coverage for medications.
Despite all these parts, Medicare doesn’t cover several essential services, including:
- Long-term care (nursing home or in-home custodial care)
- Dental care (cleanings, fillings, dentures)
- Vision exams and corrective lenses
- Hearing aids and exams
- Routine foot care
- Overseas emergency care
In addition, copays, deductibles, and coinsurance under Parts A and B can add up fast—especially during unexpected hospitalizations or outpatient treatments.
How to Fill the Gaps and Avoid Financial Surprises
Fortunately, there are several ways to protect yourself from Medicare’s blind spots.
One option is to purchase a Medicare Supplement Insurance plan (Medigap), which helps cover out-of-pocket costs like deductibles and coinsurance. Medigap policies vary by state and plan type, but many offer robust coverage for frequent medical needs.
Another option is a Medicare Advantage Plan (Part C), which bundles Parts A, B, and sometimes D, and often includes limited dental, vision, and hearing coverage. However, these plans come with networks, restrictions, and varying out-of-pocket maximums—so it’s important to compare carefully.
For long-term care needs, a separate long-term care insurance policy—or self-funding strategy—should be considered, since Medicare offers very limited support for custodial care.
And don’t forget to budget for prescription medications and dental/vision needs separately if they aren’t included in your plan of choice.
Build Healthcare Costs Into Your Retirement Plan
Health-related expenses are one of the largest—and most underestimated—costs in retirement. According to Fidelity, the average 65-year-old couple retiring today will need around $315,000 to cover healthcare expenses in retirement (not including long-term care).
Having a plan to address Medicare’s limitations ensures your income strategy is protected—and that unexpected medical expenses don’t derail your retirement lifestyle.
We Help You Plan for the Healthcare Costs Medicare Doesn’t Cover
At Heritage Financial Planning, we guide clients through all aspects of retirement—including healthcare strategy. As part of our HFP S.T.A.R. Strategy (Seasonal Transition into Advanced Retirement), we help you identify gaps in Medicare, plan for supplemental coverage, and estimate long-term healthcare expenses before they become emergencies.
Let’s make sure your retirement isn’t blindsided by uncovered medical bills. Schedule your retirement health strategy session today.
Click here to learn more about our HFP STAR Strategy process.
Sources:
• Medicare.gov – What Medicare Covers: https://www.medicare.gov/what-medicare-covers
• Fidelity Retirement Health Cost Estimate – https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs
• Centers for Medicare & Medicaid Services – https://www.cms.gov
• Heritage Financial Planning: https://heritagefinancialplanning.net/about/heritage-financial-star-strategy/
