How to figure out health care expenses in retirement?

[Sugarcubesea]

I'm planning to retire in two years, my FA told me to take out money first from my 401K that was pre-tax as that is where the bulk of my money is at, due to ROTH not being an option at most of the companies I worked at. I have only been able to contribute to a Roth for the last 10 years and for the last 10 months I have been able to contribute to a mega back door roth thru my company's 401K plan.

I will need to find a new FA when I retire as the one I use is provided free thru my company. When I spoke with a rep from Boomer Benefits ( they offer free Medicare assistance) they told me that once I retire, that is considered a life-changing event that has reduced my household income, I can ask to lower the additional amount I will pay for Medicare Part B and Part D ( IRMMA) by completing a form

 

[rapmarks]

Since I take:

• Mounjaro
• FARXIGA

I max out my Part D Out Of Pocket, so a monthly charge would be more expensive.



This

I am curious about this. When you reach a certain amount, you no longer pay out of pocket?
Are the zero premium policies available for everyone? Did the government ever phase out the donut hole?
Since I am on a group plan, I never had to study up on this.

 

[Timeshare Von]

Thank you one and all for a lively (and helpful) discussion! I have some new knowledge and clarity on several topics. TUGGERS are the best!

 

[isisdave]

I am curious about this. When you reach a certain amount, you no longer pay out of pocket?
Are the zero premium policies available for everyone? Did the government ever phase out the donut hole?
Since I am on a group plan, I never had to study up on this.

Yes, the donut hole is gone. This year, the out of pocket max for all Part D plans is $2000. It's inflation-adjusted and will be $2100 in 2026; the deductible goes from $590 this year to $615.

Part D Open Enrollment for next year happens from October 15 – December 7. The Medicare website has a very good tool for choosing ... you enter your prescriptions and it'll tell you the total predicted cost for each of many plans. Most of the information is already available.

Our plan, which costs $0 this year in the IN/KY PDP region (there are 34, so YMMV), is Wellcare Value Script. Premiums range from 0 to a few dollars in most states, but a few like NY NJ were over $40 this year.

 

[DrQ]

I am curious about this.

When you reach a certain amount, you no longer pay out of pocket?

I may pay a small amount for some meds which I'm still trying to understand. For example, I have BPH and my doctor switched me from Doxazosin Mesylate (Cardura) to Tadalafil (Cialis) - 5 mg. A 90 day supply is just over $1000, but I just paid $21. This is complicated because the pharmacy did not submit the bill to Wellcare, but to a discount program, so I did not see it in my Wellcare EOB. I suspect that it might be denied from Wellcare because of its "other" use at a higher dosage.

My name brands, Mounjaro ($1000/mo) and Farxiga ($1750/3mo) are covered at no cost.

Are the zero premium policies available for everyone?

Dunno, as previously stated, these plans are regional and you need to check with Medicare.gov to see if they are offered in your area.

Did the government ever phase out the donut hole?

Kinda, sort of ... the transition to catastrophic is more linear with the max OOP being reduced to $2000 and you can choose to spread that over a year to help budgeting.

The anthill is about to be kicked again come October with annual enrilement (all those emails, mailings and commercials!), so we will see how the plans change.

 

[DrQ]

When I spoke with a rep from Boomer Benefits ( they offer free Medicare assistance) they told me that once I retire, that is considered a life-changing event that has reduced my household income, I can ask to lower the additional amount I will pay for Medicare Part B and Part D ( IRMMA) by completing a form

Yes, but you have to get the DOGE'd Social Security office to accept it and process it.

Pre-DOGE:
I was laid off and submitted my and my DW's Medicare application and was IRMAA'd due to an inherited annuity cash out. I submitted the proper form for me and DW. Mine was approved and DW's was never acknowledged. By the time I could resubmit DW's application, the year was almost over, so I said "screw it".

Word of advice with dealing with Social Security: Mail it with Certified Mail, Return Receipt Requested.

 

[Tia]

We went for the first time ever to our local SS office without an appt, you can make one if you chose to. We were in/out in 1 hour with our issue, changed bank # for deposits.

 

[Brett]

We went for the first time ever to our local SS office without an appt, you can make one if you chose to. We were in/out in 1 hour with our issue, changed bank # for deposits.

Lucky you

https://www.nytimes.com/2025/09/24/business/social-security-customer-service.html

 

[Timeshare Von]

Yes, the donut hole is gone. This year, the out of pocket max for all Part D plans is $2000. It's inflation-adjusted and will be $2100 in 2026; the deductible goes from $590 this year to $615.

Part D Open Enrollment for next year happens from October 15 – December 7. The Medicare website has a very good tool for choosing ... you enter your prescriptions and it'll tell you the total predicted cost for each of many plans. Most of the information is already available.

Our plan, which costs $0 this year in the IN/KY PDP region (there are 34, so YMMV), is Wellcare Value Script. Premiums range from 0 to a few dollars in most states, but a few like NY NJ were over $40 this year.

The changes in how Rx's are covered are why I'm now buying my Eliquis from a Canadian pharmacy.

 

[DrQ]

The changes in how Rx's are covered are why I'm now buying my Eliquis from a Canadian pharmacy.

Have you hit your Part D $2k Max, or do you have a Medicare Advantage plan?

If it's MA, they can throw pre-authorization at you. You need to RTFM.

 

[DrQ]

If it's MA, they can throw pre-authorization at you.

I have Parts A, B, D & G and have run into two cases of denial (Preauthorization needed)

• CGM - Continuous Glucose Monitor (Denied because I did not have documented hypoglycemia within the request window)
• Non-formulary med (Doctor prescribed the whiz-bang drug recommended by pharmaceutical rep when a name brand drug of the same composition was preferred)

 

[rapmarks]

You know pre authorization sounds bad, but denying a claim after you have had the service is worse. That was what it was like raising my family, denied a hospitalization, denied an emergency visit, denied doctors visits, told you after a procedure it wasnt covered. And the old trick, we never received the claim, and you had to resubmit many times. Those were tricks of the trade for the insurance company that went with my husbands job. Now, the service providers check with insurance first.

 

[Tia]

You know pre authorization sounds bad, but denying a claim after you have had the service is worse. That was what it was like raising my family, denied a hospitalization, denied an emergency visit, denied doctors visits, told you after a procedure it wasnt covered. And the old trick, we never received the claim, and you had to resubmit many times. Those were tricks of the trade for the insurance company that went with my husbands job. Now, the service providers check with insurance first.

I called my other half's HR once after a denial for a broken bone out of state, HR called and wrote the insurance company telling them NO MORE DENIALs. My sister also was a claims examiner for insurance so was helpful.

 

[DrQ]

You know pre authorization sounds bad, but denying a claim after you have had the service is worse. That was what it was like raising my family, denied a hospitalization, denied an emergency visit, denied doctors visits, told you after a procedure it wasnt covered. And the old trick, we never received the claim, and you had to resubmit many times. Those were tricks of the trade for the insurance company that went with my husbands job. Now, the service providers check with insurance first.

Except when it is used as a cost cutting measure:

When an insurance company denies a request for prior authorization, it’s highly likely that physicians and patients won’t appeal the denial.​

​

Just one in 10 prior authorization requests that were denied in 2022 were appealed, according to a recently released KFF analysis of data that Medicare Advantage insurers submitted to the Centers for Medicare & Medicaid Services (CMS) between 2019 and 2022.​

​

The statistic is particularly alarming when one considers that the overwhelming majority of appeals—83.2%—resulted in the insurance company either partially or fully overturning the initial prior authorization denial in 2022. That figure is similar to what the overturn rate was between 2019 and 2021.​

Over 80% of prior auth appeals succeed. Why aren’t there more?

Physicians, squeezed for time and eager to get treatment started, often steer clear of appeals in broken prior auth system that needs major overhaul.

www.ama-assn.org

 

[rapmarks]

Except when it is used as a cost cutting measure:

When an insurance company denies a request for prior authorization, it’s highly likely that physicians and patients won’t appeal the denial.​

​

Just one in 10 prior authorization requests that were denied in 2022 were appealed, according to a recently released KFF analysis of data that Medicare Advantage insurers submitted to the Centers for Medicare & Medicaid Services (CMS) between 2019 and 2022.​

​

The statistic is particularly alarming when one considers that the overwhelming majority of appeals—83.2%—resulted in the insurance company either partially or fully overturning the initial prior authorization denial in 2022. That figure is similar to what the overturn rate was between 2019 and 2021.​

Over 80% of prior auth appeals succeed. Why aren’t there more?

Physicians, squeezed for time and eager to get treatment started, often steer clear of appeals in broken prior auth system that needs major overhaul.

www.ama-assn.org

It is a cost cutting measure. Purposely used in expectation that the procedure will not be appealed

 

[clifffaith]

My 90 year old mother paid several thousand dollars this year for an eyelid lift on one eye. She was reading with one hand on her book and the other hand pulling up her drooping eyelid. And one or the other of her eyes is severely compromised from a garden fungus followed by a not-too-successful cornea transplant. But her plan denied paying for the procedure. I thought that should have been appealed, but she just paid for it herself.

 

[DrQ]

It is a cost cutting measure. Purposely used in expectation that the procedure will not be appealed

Let's put some real numbers to this:
Let's use this phrase (resulted in the insurance company either partially or fully overturning the initial prior authorization denial) to assume an 80% successful appeal capture rate.
0.1 X 0.832 X 0.8 = 0.06656 or they are paying $6.57 for every $100 in claims denied
From the insured person's perspective:
0.9 X 0.832 X 0.8 = 0.59904 or they SHOULD be paying $59.90 for every $100 in claims denied

That is a cost of $53.33 to each insured per $100 for each denied claim.

Not a bad return on inconvenience, and throw the decision making to AI, you cut staff and profits soar.

 

[Luanne]

I haven't seen a $0 part D drug plan, who is that through?

I have one through Wellcare. What's strange though is that my husband has the same plan and he pays a small premium.

 

[geist1223]

All this discussion and horror stories makes me glad I got my 20 years Military (Active Duty and Active Reserves) and have Tricare for Life. Patti has had 2 knee Surgeries and then there was my extended stay in the Hospital 3 years ago with Pancreatis. Zero Bills to us. We get our recurring Medicines in the Mail with Express Scripts. Minimal cost. Medical providers first Bill Medicare and once they get that payment they Bill Tricare for Life. If I die first Patti keeps Tricare for Life.

 

[DrQ]

I have one through Wellcare. What's strange though is that my husband has the same plan and he pays a small premium.

Look closely. Wellcare has multiple Part D plans in our area. One is no premium, the others vary in premium and medicine coverage.

 

[Timeshare Von]

Have you hit your Part D $2k Max, or do you have a Medicare Advantage plan?

If it's MA, they can throw pre-authorization at you. You need to RTFM.

I have a Medicare advantage plan . . . which also has the $2k max. But the only real expense I have is the Eliquis so why max it out for $2k when I can buy from Canada for $800/year? I don't even mess with my insurance starting this year. (It was significantly less total out of pocket in 2023-2024!) No pre-authorization has ever been required since I came on Medicare (and this Advantage plan) in November 2022.

 

[DrQ]

But the only real expense I have is the Eliquis so why max it out for $2k when I can buy from Canada for $800/year?

That would make sense. If I had just one big ticket med, I would probably do the same.

 

[SusanRN]

Our plan, which costs $0 this year in the IN/KY PDP region (there are 34, so YMMV), is Wellcare Value Script. Premiums range from 0 to a few dollars in most states

Predictions were that costs would go up substantially this year for a variety of reasons, including the "donut hole" now being only $2,000.
I also have Wellcare Value Script. My premium in Maryland was $4/year in 2024 and $0/year in 2025. I received my Annual Notice of Change last week. The premium will be $67.20/year in 2026.
Although 3 of my meds are free thru Wellcare and one is only $60/year, I have two that are in a high tier. I would have to pay the full Part D Deductible ($625 in 2026) plus $800 if I get them through Wellcare -- so I don't.
I priced them thru GoodRx and get them at a local grocery store for $63/year and $110/year -- cheaper even than the cash price at Costco. I'm happy.
If you have meds in higher tiers, remember to check alternatives such as Good Rx and Mark Cuban's Cost Plus Drugs. Both have excellent prices without using insurance.

 

[heathpack]

Ok I just extrapolated it all out. If I retire 1 day after I turn 62 years old, just about 1/3 of our retirement savings will be in accounts that are not taxed upon withdrawal: Roth IRAs or HSAs. That's a higher % than I thought.

 

[Brett]

Ok I just extrapolated it all out. If I retire 1 day after I turn 62 years old, just about 1/3 of our retirement savings will be in accounts that are not taxed upon withdrawal: Roth IRAs or HSAs. That's a higher % than I thought.

That's good. And if you have no income then the other 2/3's of your retirement savings will be taxed at a low rate when withdrawing funds