Tag Archives: medical expenses

Low interest rates affect seniors’ ability to pay medical expenses

A lot is written about people who don’t save enough for retirement. But what about older adults who saved diligently, only to find the value of their nest eggs depleted in this low-interest rate environment?

Judith GrahamJudith Graham (@judith_graham), AHCJ’s topic leader on aging, is writing blog posts, editing tip sheets and articles and gathering resources to help our members cover the many issues around our aging society.

If you have questions or suggestions for future resources on the topic, please send them to judith@healthjournalism.org.

I’m not talking here about stocks that take a tumble, slicing into their value. I’m talking about the interest rates that older people earn on money put away in bonds, money market funds, or certificates of deposit – and that they count on to supplement Social Security payments in their retirement years.

When these interest rates are at historically low levels, as they are now, people who counted on earning 5 percent to 7 percent annually from their savings can find themselves instead earning instead 1 percent to 2 percent. That can make a real difference in the affordability of their retirement plans and their ability to handle expenses such as payments for housing, food, prescription medications or out-of-pocket medical expenses.

For a really good examination of the issue, look at this story in the Minneapolis Star Tribune by Jennifer Bjorhus. It’s full of detailed analysis and personal stories that illustrate this problem which, it’s safe to say, is playing out with seniors in every community across the United States. Continue reading

Report: Prescription drug prices doubled in 10 years

Prescription drug prices doubled from 1996 to 2006, according to new inflation-adjusted numbers from the Agency for Healthcare Research and Quality.

In the report, Trends in Health Care Expenditures for Adults Ages 18-44: 2006 versus 1996, (PDF) AHRQ also reveals that health-care expenses were about $40 billion more in 2006 than 10 years before and the average expenses increased significantly for visits to doctors offices, emergency rooms and dentists.

The analysis did not find a significant difference in how people were paying for their medical expenses; in both years, more than half were paid by private insurance, about one-fifth were paid out of pocket, and most of the
remaining expenses were paid by Medicaid.