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Four topics to explore to help you make better healthcare decisions

Elizabeth Nichols

December 14, 2020

Are you feeling overwhelmed by an ever-changing healthcare system?

This is the final blog in a three-part series that focuses on the practical side of aging wisely.
Part 1: Four practical steps you can take to ensure your estate plan is effective
Part 2: Are you concerned about cognitive decline in you or a loved one? Three action items to help plan for the path of inevitable change

Healthcare: It’s an insurance system, the medical professionals you see, the drugs you take, the clinics you visit and the lab results you get. It’s also a tangle of financial and personal relationships. At various stages of life—including, retirement, starting a new business, changing jobs, becoming Medicare-eligible—healthcare is one more decision point and understanding and managing it all can be a big undertaking. However, exploring the four topics below can help you make better decisions about your healthcare today and in the future.

1. Costs, trends and strategies

In general, healthcare and how you plan for it can be grouped into three areas:

  • Costs - Your healthcare cost is very specific and personal to you and will depend on when and where you retire, how healthy you are and how long you live.  Considering this potentially large expense is important as you consider future cash flow. 
  • Trends - Over the last ten years, there has been a push to emphasize comprehensive primary care with a goal of patient-centered care.  There has also been a push to shared decision-making where physicians are making recommendations in a more collaborative way.
  • Strategies - Below are some practical strategies that can help you have more control over your healthcare:
    • Create a personal healthcare file
    • Understand your insurance coverage
    • Foster strong relationships with your healthcare team
    • Prepare written agendas before every doctor’s appointment
    • Enlist a care partner to be an extra set of eyes and ears for you


2. Medicare

One very important first step when trying to estimate out-of-pocket healthcare costs is to understand fully what Medicare will and will not cover. To understand Medicare, it’s important to become familiar with each of the “parts” of Medicare:

  • Part A is the “original Medicare” and generally covers hospital care, inpatient mental health, certain skilled nursing facilities, hospice and home health services.
  • Part B generally covers outpatient services and supplies considered medically necessary, in addition to preventative services.
  • Parts C and D are the two ways to get prescription drug coverage under Medicare.
  • Medigap is supplemental insurance that can help pay some of the healthcare costs not covered by Medicare, such as copayments, coinsurance and deductibles.


3. Long-term care insurance

Long-term care insurance is designed to help pay for the cost of long-term care services and, depending on the type of policy and the coverage selected, can provide coverage in many settings—at home, in community settings, in assisted living facilities and in nursing homes. When, and if, to buy long-term care insurance is an individual decision, but these considerations may help you decide: 

  • Age - Generally, the younger you are when you buy the policy, the lower the premium, but the longer you may end up paying the premium before coverage is needed. 
  • Health status and medical history - Your health status and medical history will impact your premium and, if you have a serious medical condition, past or current, you may not qualify for coverage.
  • Financial stability of your insurer - No matter when you purchase a plan, make sure the company you select is financially strong and has a long track record selling this type of insurance. This type of insurance coverage has evolved over recent years and should be evaluated carefully.


4. Healthcare planning documents.

Three of most important healthcare documents you should have include:

  • Healthcare proxy or durable medical power of attorney – to appoint someone you trust to make medical decisions for you when you are no longer able 
  • Living will or advance directive – to express your specific wishes about certain aspects of end-of-life care
  • HIPAA release - to grant your healthcare agent and potentially other fiduciaries the right to access your medical records

 

Navigating healthcare is an issue of both understanding your own feelings about life, as well as understanding the system and the documents, particularly as you continue to age.  Preparing as well as you can for that stage of life when healthcare takes center stage can be a wonderful gift to your family and to yourself. For more information on navigating a changing healthcare system, visit our The Practical Side of Aging Wisely resource page.

Elizabeth Nichols is a senior wealth strategist in CIBC Private Wealth’s Houston office, with more than 25 years of industry experience. In this role, she assists high net worth clients and their advisors develop and implement comprehensive estate plans.