Your workers probably spend a  lot of time and energy worrying about and preparing for retirement expenses. But if they’re like many Americans, they might be overlooking an important aspect of retirement planning: healthcare costs.  

According to a 2013 survey conducted by AARP, few adults in their 50s and 60s have begun saving for the healthcare expenses they may incur during their retirement years. Only 36 percent report having a plan and savings in place to help cover healthcare in retirement. Sometimes employees mistakenly assume that Social Security or Medicare will cover most of their healthcare costs, and other times they simply forget to plan for their medical needs.

As an employer, should you help educate your workers about this aspect of retirement planning, and help them prepare for healthcare expenses in retirement? And if so, how?  

If some of your employees would like to retire but can’t afford to do so, workplace dynamics can suffer. Morale might diminish, employees could become less engaged, and the cost of doing business could increase. In addition, having a conversation about healthcare planning is a good way to show gratitude to loyal employees nearing retirement.  

Helping educate your employees about the need to save for future healthcare expenses can be an important part of a good employee wellness program. Here are some tips for getting started.  



Know the basics: Retirement healthcare at a glance 

According to Fidelity Investments, a couple retiring at age 65 will need to have saved $260,000 to cover lifetime healthcare costs. Seniors should expect to pay out-of-pocket for their deductibles, co-payments, prescription drugs, and other expenses that Medicare doesn’t cover. However, this amount doesn’t include costs for long-term care, which requires an additional $130,000 

Medicare is a federal insurance program available to individuals 65 and older. It comes in four parts:  

  • Part A includes coverage for inpatient hospital services, nursing facility stays, hospice, and some in-home healthcare services. Most people are eligible for Premium-Free Part A.  
  • Part B is supplemental to Part A and includes additional coverage for services like doctor visits, medical supplies, and outpatient care. Part B requires a monthly premium payment.   
  • Parts C and D provide prescription drug coverage through private insurers. Premiums vary by plan.  

Parts A and B require a deductible, after which seniors typically pay 20 percent of the Medicare-approved amount for most doctor services, outpatient therapy, and durable medical equipment.  

Employees over age 65 are able to stay on their group medical plan if they wish, but they will affect the average age of the group. Employers can’t require older workers to waive group coverage, but you can educate them about their options.



Act as a trusted advisor  

To help your employees better understand the need to save for retirement healthcare costs, consider incorporating a lunch-and-learn seminar, a workshop, or written information into your employee wellness program. If you offer a health savings account (HSA), encourage employees to enroll in order to begin saving for future healthcare expenses.  

Employees who are reaching retirement age might need help navigating their upcoming healthcare options. It’s important for employees enrolling in Medicare to find a trusted advisor to help them choose the right retirement health package for themselves and potentially their spouse, based on their specific health needs. 

Let your employees know that you are there to help with and support their transition into retirement and that you care about their healthcare even after their employment ends. 


Consult with an expert  

Considering the complexities of the health insurance industry, it’s a good idea to consult with an expert if your employee is unsure which route to take. Aliat helps you create a healthier workforce and prepare employees for retirement with offerings that include 401(k) and HSA programs, retirement planning, health risk assessments, and employee wellness education.  

Request a Consultation to speak with an Aliat retirement specialist.