Despite rising health-care costs and personal financial losses caused by the recession, nine out of 10 retirees still feel confident they will be able to pay for their future health care costs beyond what Medicare covers, according to a Nationwide Financial survey.

According to the survey, 93% of Americans in retirement say they are at least somewhat confident they can pay for their future health care costs. That's in stark contrast with the 46% of baby boomers nearing retirement with the same amount of assets who say they're "terrified" of what health care costs will do to their retirement plans.

Although it may be good news that retirees aren't pushing the health-care coverage panic button, as some baby boomers are, John Carter, president of Nationwide Financial Distributors Inc., a subsidiary of Nationwide Financial, said they shouldn't get too financially overconfident since there may be future bills down the road. "For many of the retirees we surveyed, most of their health care costs have yet to come," he said.

Carter said retirees' confidence may stem from the fact that so far they been able to handle those bills. In addition, many current retirees have pensions and employer-paid health care-a luxury many boomers nearing retirement do not have.

Forty percent of those in retirement say their biggest retirement expense is paying monthly housing bills; 21% listed the cost of health care, and 16% said providing for their family. In contrast, 45% of those nearing retirement say they expect health care to be their biggest expense, followed by 35% citing their monthly housing bills, and 9% selecting to provide for their family.

Retirees, on average, estimate they currently spend $4,083 each year on health care for items like premiums, co-payments and deductibles, while 21% estimate they spend less than $1,499 each year, and 22% said they actually don't know how much they spend.

Retiree health-care costs have increased an average of 6% a year since 2002. That means a 65-year-old couple retiring today would need $240,000 to cover medical expenses during their retirement years, which could take up to 35% of the couple's annual Social Security benefit. And that number doesn't include long-term care costs. Even if they're able to pay for health care costs today, too many retirees fail to plan for inflation, according to Nationwide Financial. The costs of nursing home care and assisted living nationwide went up more than twice the rate of inflation between 2009 and 2010. According to the U.S. Department of Health and Human Services, people over the age of 65 have a 70% chance of needing long-term care during their lifetime.

"Too many people underestimate the amount of money needed to cover their health-care costs in retirement because they do not think they will ever need long term care," said Kevin McGarry, director of the Nationwide Institute, a research group owned by Nationwide Financial.  

In 2008, the annual cost of a nursing home was about $71,000 for a semi-private room, but nursing home costs are expected to reach $265,000 per year by 2030. There's also the risk of incurring exceptionally large health care expenses. At age 65, a typical married couple free of chronic disease faces a 5% probability that their remaining lifetime health care costs-excluding nursing home care-will exceed $311,000. Including nursing home care, they face a 5% probability of costs exceeding $570,000.

"These retirees know bad things happen to other people that result in costly health care services, but most just don't think it will happen to them," Carter said.

Data was collected via an online survey by Harris Interactive on behalf of Nationwide Financial from Jan. 3-19. The survey was of 625 adults, age 55 or more, with $250,000 or more in household assets who plan to retire by 2020, and 625 retired adults, age 65 or more, with $250,000 or more in household assets. Columbus, Ohio-based Nationwide Mutual Insurance Company is an insurance and financial services organization.

-Jim McConville