The cost for Part D is means tested and some people do not take it, which potentially makes the cost of drugs a large expense in retirement for some individuals if they are on a lot of prescriptions, Klein says. Private insurance companies sell the insurance.
Part C of Medicare insurance is a Medicare Advantage plan that combines Parts A, B and sometimes D under one policy.
In addition to the four parts of Medicare, there is still more to be considered when planning for health care costs in retirement, Klein warns. Medicare, for the most part, does not cover home health care or long-term care in a nursing home unless it is medically necessary.
For most nursing home care, a long-term care insurance policy is necessary. Nursing home care averages $50,000 a year and up and the costs keep rising, according to AARP.
Although long-term care insurance is expensive, it is less expensive than nursing home care. A long-term care policy can run $6,000 or more a year for a single person.
“Are you thinking of Medicare to be your long-term care plan?” Klein asks. “If so, you may want to rethink your plans.”
Klein wrote a blog entry on the subject that can be found on his Retirement Income Visions blog http://www.retirementincomevisions.com/retirement-income-visions/2013/05/are-you-depending-on-medicare-for-long-term-care-coverage.html.
For a useful Medicare primer, Klein recommends the official U.S. government publication that is updated yearly called “Medicare and You.”