As Baby Boomers enter retirement years, a recent study shows that the generation is largely underprepared for the cost of their medical treatments. Ameriprise Financial's Health, Wealth and Retirement study found that only in one in five pre-retirees have taken financial action to prepare for rising health care costs.
Ameriprise estimated that the average retiree would need about $232,000 to be 90 percent sure of covering the health care costs for themselves and their spouse in retirement. Upon hearing this figure, more than three-quarters (86 percent) reported being at least somewhat concerned about their personal health in their retirement years.
"Boomers understand that health care costs will be a significant expense in retirement, yet many haven't planned – or simply don't know how to plan – to fund these expenses," Pat O'Connell, executive vice president of Ameriprise Financial wrote in a statement accompanying the report. "Fortunately, the national conversation around health care is prompting people to consider their health and the choices they make, as well as the need to build health care expenses into their retirement and long-term financial plan."
However, it may be worth considering that even though boomers may be far from financially prepared for retirement, they are taking actions to remain physically healthier. More than 60 percent of those surveyed said that they have begun a diet or exercise program with the aim of reducing healthcare costs.
When patients are unprepared for the cost of their medical treatments, care facilities can experience issues with healthcare revenue cycle management that grow to affect the quality of care provided. To avoid this outcome, accounts receivable management professionals are encouraged to outsource their overdue accounts in order to increase cash flow and recover a substantial percentage.