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Medical Bills: The Cost of the Final Five Years

Seniors and their families always face a reality check when they realize how much Medicare doesn’t cover—from necessary sundries like your drug-store “cheater” reading glasses to major costs like nursing-home care. A new study in the Journal of General Internal Medicine focuses on out-of-pocket spending in the final five years of a Medicare recipient’s life, and generates some sobering details where that’s concerned. According to a review of the report by the Wall Street Journal’s Glenn Ruffenach, about one household in ten will spend $100,000 – again, that’s just out-of-pocket, not the total bill – over those five years.

Many retirees, of course, don’t have $100,000 to spend by the time they reach that stage. Which leads to another unsettling finding: According to a summary of the study, a quarter of the Medicare recipients in the study “spent more than their total household assets on healthcare” (emphasis mine). Behind that number, undoubtedly, are sandwich-generation boomers making some difficult decisions as they try to help their parents.


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About Encore

  • Encore examines the changing nature of retirement, from new rules and guidelines for financial security to the shifting identities and priorities of today’s retirees. The blog also explores news that affects retirement, from the Wall Street Journal Digital Network and around the web. Lead bloggers are reporter Catey Hill and senior editor Jeremy Olshan. Other contributors include The Wall Street Journal’s retirement columnists Glenn Ruffenach and Anne Tergesen; the Director for the Center for Retirement Research at Boston College, Alicia Munnell; and the Director of Research for Pinnacle Advisory Group, Michael Kitces, CFP.