Believe or not, where retirees choose to live can greatly impact how much they will pay for healthcare over the long term, especially when it comes to premiums.
Using HVS Financial’s RetireMark Software tools (click here for free trial) we analyzed the data of a 65-year-old couple who are;
- Retired as of today
- Have longevity projections of 85
- Will earn under $170,000 in income as defined by Medicare throughout retirement.
- Want to cover premiums for Medicare Part B, Part D, and a MediGap (Plan C) supplemental policy
The cheapest place to live, which came as a shock, is Hawaii ($271,284) and the most expensive (not so much of a shock) is New Jersey ($362,844).
A whopping 33.7% difference exists between the two states.
The determining cost factor among states is simply supply vs. demand. Part B will be a constant for every individual in the U.S. who has paid into the system and whose earnings fall below the Medicare minimum, but Part D and the MediGap Policies are sold by private insurance companies that control prices (with Medicare setting some standards).
So Hawaii, which has a smaller retired population and slightly healthier residents than the rest of the country, will enjoy the lowest healthcare premiums. Conversely New Jersey, with a much larger population (that ostensibly needs extensive healthcare) than Hawaii, is much more expensive because the premiums set by the private insurance companies are higher.
Here is a complete breakdown of how each state stacked up including D.C. and the National Average
|3||South Dakota||$ 299,714|
|5||New Mexico||$ 303,314|
|7||North Dakota||$ 307,084|
|9||New Hampshire||$ 313,344|
|19||Rhode Island||$ 322,834|
|20||South Carolina||$ 323,724|
|22||West Virginia||$ 324,234|
|23||North Carolina||$ 324,414|
|29||Washington D.C.||$ 332,914|
|35||National Average||$ 335,434|
|41||New York||$ 338,624|
|52||New Jersey||$ 362,844|