As the number of American retirees living overseas grows, more of them are confronting choices about medical care. Medicare doesn’t pay for care outside the country, except in limited circumstances. Expatriate retirees might find private insurance policies and national health plans in other countries. But these may not provide the high-quality, comprehensive care at an affordable price that retirees expect through Medicare. Faced with imperfect choices, some retirees cobble together different types of insurance, a mix that includes Medicare.
The quality of health care varies widely by country, as do the services available to foreign residents. And there are quite a few of these transplanted Americans. Between 2012 and 2017, the number of retired workers living in foreign countries who were receiving Social Security benefits grew nearly 15 percent, to more than 413,000, according to the Social Security Administration. The largest numbers of expatriates were in Canada (nearly 70,000) and Japan (more than 45,000). Mexico was third, home to nearly 30,000 retired American workers.
Commercial health care policies for them may provide decent coverage, but people can generally be denied a policy or charged higher rates for medical reasons. The plans may refuse to cover some pre-existing conditions, for example, allergies. Private policies may also have age limits. The GeoBlue Xplorer Essential plan enrolls only people who are 74 or younger, and coverage expires when people turn 84. In contrast, Medicare eligibility generally begins at 65 and continues until a beneficiary dies.
Even when retirees buy a private policy, Medicare is another piece of the puzzle that they have to consider. Once people become eligible for Medicare coverage, they face a 10 percent premium penalty for every 12 months that they are not enrolled in Part B, which covers outpatient services. (People who are 65 or older but still covered by an employer plan generally do not face that penalty.) After paying into the Medicare system for decades, typically via payroll taxes, some expats are frustrated that they generally can’t use the program outside the United States. That’s just the way the law is written, an official at the federal Centers for Medicare and Medicaid Services said.
This article was produced by The New York Times in collaboration with Kaiser Health News.
Want to know about Medicare and what it covers (or doesn't cover)? Check out Savvy Medicare Planning for Boomers or the Savvy Social Security and Medicare Workshop.