Travelling in Retirement: A Global Health Plan is a Must Have

As reported by WealthManagement.com

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One of the first orders of business for clients considering a move abroad is selecting a location with access to good health care.  “It’s important to not only know if a country has a solid health care infrastructure, but also to make sure you’re in striking distance of a good hospital emergency room, since older people are by definition more prone to needing emergency services” says Josef Woodman, CEO of Patients Beyond Borders, which publishes a guide to health care facilities around the world.

Woodman urges retirees to locate near a western-style hospital that has been accredited by the Joint Commission International, and preferably one built in the past ten to 15 years. “The good news is, most Americans aren’t retiring in the hinterlands - they’re going to be within striking distance of a larger city, and chances are good that there will be an excellent facility within a couple hours of anywhere you’d want to retire.”

Medicare doesn’t cover services provided outside the U.S., so your clients may want to buy an international policy. Market leaders, Woodman says, include AetnaCigna andBlue Cross Blue Shield.

Clients moving abroad can opt not to enroll in Medicare if they expect to get all of their health care needs fulfilled outside the U.S., and for those who already had enrolled, it’s possible to exit the program. Medicare Part A (hospitalization) carries no premium, so there’s no reason to cancel that coverage. Part B (outpatient services) can be canceled by written notice to the Social Security Administration; Part D prescription drug coverage can be canceled by contacting the plan provider.

What about a client who moves abroad and later decides to return to the U.S.? She can re-enroll in Parts B and D during the general enrollment period (January 1 - March 31), and coverage would begin in July. However, she’d be subject to the Part B penalty, which is applied in any situation where a senior is over age 65 and should have been enrolled. The penalty is 10 percent of the standard Part B premium for every full 12 months the beneficiary could have had Part B but didn’t.

“That penalty is permanent in most circumstances,” says Jennifer Whittaker, operations supervisor for Allsup Medicare Advisor, a fee-based Medicare advisory service. There is no penalty for re-enrollment in Part D coverage, she adds.

“Assuming someone kept Parts A and B going while they were away, she could receive a special enrollment period (SEP) for Part D of two months after the month they return to enroll in Part D coverage again. There is no penalty for re-enrollment in Part D coverage. If someone kept both Parts A and B while away, they can sign up for a Medicare Advantage plan with prescription drug coverage during the SEP.”