How Dental and Vision Insurance Should Factor into Your Retirement Planning

In retirement, seniors can certainly expect federal and state programs to cover some medical costs; however, most dental and vision care services will require either out-of-pocket payment or the purchase of a standalone plan. Once earned income stops flowing in, retirement financial planning can be a stressful and intimidating task. Here is some information on dental and vision care to help with retirement planning.

Medicare

Most retirees qualify for Medicare coverage after age 65. Medicare Part A, the coverage that is provided without premium to seniors, provides insurance for inpatient and hospital expenses, but it would only apply to dental and vision care administered during hospital stays or in emergency situations. Medicare Part A would not pay for most dental and vision care.

Supplemental and elective portions of the Medicare program allow people to pay premiums for expanded coverage. Of note to dental and vision care are Medicare Part B and Part C. Part B is meant to address outpatient services, doctor visits, and preventive care, but it is limited for dental and vision. Cataract surgery, prosthetics for some complicated issues, and certain screenings fall under Part B, whereas routine exams and corrective lenses do not. Similarly, Part B will pay for dental care in complex cases related to surgeries or larger systemic medical issues, while routine visits, cleanings, extractions, dentures, and similar services do not fall under the plan.

Private insurance companies that adhere to certain guidelines offer Medicare Part C, also known as a Medicare Advantage (MA) plan. This plan is meant to replace Parts A and B, while providing other features that individuals may prefer. The terms and features of MA insurance vary among carriers and packages, but they frequently provide coverage for routine care including dental and vision. This typically requires a higher monthly premium than policyholders would pay otherwise, but the benefits are obvious for people who want to avoid paying out-of-pocket for certain services.

Medicaid

Medicaid may also be a viable option for some people in retirement. This federal and state program provides coverage to low-income individuals and households, and 11% of Americans above the age of 65 are enrolled in those plans. Eligibility criteria vary from state to state, but it may be wise for seniors who are struggling to meet their monthly cash expenses to explore these options. The services that fall under Medicaid vary among states, but Medicaid may pick up many routine exams and urgent procedures not covered by Medicare.

Private Insurance

Finally, seniors can also purchase standalone policies from private insurers that cover the gaps left by Medicare. Major health insurance carriers offer plans that will pay in part or in whole for routine dental and vision services. These plans can be purchased in the healthcare marketplace, and monthly premiums typically range from $15 to $60 for each. 

Planning Ahead

When planning for vision and dental care in retirement, meeting regular and unexpected cash flow requirements will be among the chief issues that must be addressed, and retirees should be realistic about their medical expenses when determining their budgets. Dental and vision care are necessary for many people, and these services are almost certainly going to come with expenses that must be factored into decisions pertaining to retirement age, Social Security payments, and distributions from retirement accounts.

Ryan Downie is a consultant and former equity research analyst and financial planner with a BA in economics from Notre Dame.

Sources: 
https://www.prb.org/majority-of-people-covered-by-medicaid-and-similar-programs/#:~:text=Adults%20ages%2065%20and%20older,represent%20just%20under%202%20percent.
https://www.ehealthmedicare.com/medicare-coverage-articles/medicare-vision-benefits/
https://www.healthmarkets.com/content/medicare-part-b-dental-coverage
https://www.hhs.gov/answers/medicare-and-medicaid/what-is-medicare-part-c/index.html