Part of a financial advisor’s job is to help clients manage the risks that could derail their financial plans or harm their financial well being. Healthcare planning is an important part of this risk management.
As generation X gets older their health is increasingly having more significance on their wealth. To older gen Xers, aging is potentially more detrimental to their wealth than stock market volatility.
According to a CDC report, 78% of US adults 55 and older have at least one chronic condition (Source: CDC/National Center for Health Statistics: National Health Interview Survey). If you are one of the gen Xers and have not started healthcare planning, now is a good time to start preparing for the unavoidable health issues later on.
When it comes to healthcare planning people usually thinks it is all about comparing and buying health insurance. In fact, health planning is a holistic process. It starts with an intentionally planned wellness regime that takes care of not only your physical well being but also your mental/emotional well being. Your wellness program needs to be reasonable, fitting your lifestyle and easy to stick with.
An integral part of your wellness plan is preventative care such as once a year physical examination. As people get older, health related expenses increase, too. Major medical bills are the leading cause for personal bankruptcy in US. It is more cost effective to prevent an illness than treating it. So, if you are 40 or older do not procrastinate on your annual physical.
What is more, the current pandemic also highlighted the fact that healthcare planning is a critical part of one’s risk management. The potential costs of a person hospitalized with coronavirus could be in the range of $21,936 to $38,755 if that person uses in-network service providers; if using out-of-network providers, the costs could be even higher, potentially costing you $42,486 to $74,310 (sources: FAIR Health). Therefore, it is urgent to identify in advance which in-network hospital will be your go-to hospital under your current health insurance plan.
If, unfortunately you have incurred coronavirus related medical bills, ask the health provider(s) to provide an itemized charge to make sure it does not have charges waived by CARES Act, such as diagnosing tests and co-payments. Alternatively, you can go to ahip.org/health-insurance-providers-respond-to-coronavirus-covid-19 to find out what health insurers are offering to consumers during the pandemic.
A comprehensive healthcare plan also includes a few important legal documents, such as power of attorney and medical advanced directive. If you have drafted these documents a while ago, now is the time to update them to reflect the current and changing situations.
Poor health undermines our ability to work, thus reducing our earnings potential. Poor health also hinders our ability to enjoy life. It is imperative that gen Xers start taking care of their health now to live a quality life down the road.